Document:

Exhibit10_37

Exhibit 10.37

CONFIRMATION OF GUARANTY

 

This CONFIRMATION OF GUARANTY (the "Agreement") is made and entered into as of the 1st day of February, 2001, by and between PERFORMANCE FOOD GROUP COMPANY, a Tennessee corporation ("Guarantor"), and FIRST UNION NATIONAL BANK
, a national banking association ("Bank").

W I T N E S S E T H:

WHEREAS, Fresh Advantage, Inc., a Virginia corporation, successor by merger to KMB Produce, Inc., a Texas corporation and an affiliate of Guarantor (the "Borrower"), borrowed the proceeds of the Carrollton Payroll Development
Authority Industrial Development Revenue Bonds (KMB Produce, Inc. Project), Series 1999 issued in the original aggregate principal amount of $9,000,000 (the "Prior Bonds") in order to finance the acquisition, construction, installation and equipping of a
manufacturing facility in Carroll County, Georgia; and

WHEREAS, as security for the Prior Bonds, the Bank extended to the Borrower, an irrevocable, direct-pay letter of credit no. SM407968C dated March 19, 1999 in the original stated amount of $9,187,500 (the "Obligation") under that
certain Letter of Credit and Reimbursement Agreement, dated as of March 1, 1999, as amended by Amendment No. 1 to the Letter of Credit and Reimbursement Agreement, dated as of February 1, 2001 (collectively, the "Reimbursement Agreement"); and

WHEREAS, the Borrower has determined to refund the Prior Bonds to remove certain onerous covenants with the issuance of the Borrower's Taxable Variable Rate Demand Bonds, Series 2001 (the "Bonds"); and

WHEREAS, the Bank has agreed to the continuance of the Letter of Credit as security for the Bonds; and

WHEREAS, Guarantor executed and delivered to Bank that certain Guaranty Agreement, dated as of March 1, 1999 (the "Guaranty"), which guarantees the full and prompt payment and performance of the Obligations as described in the
Reimbursement Agreement; and

WHEREAS, Guarantor and Bank wish to confirm that the Guaranty remains in full force and effect and guarantees the Obligations with respect to the Letter of Credit, as amended or supplemented from time to time; 

NOW, THEREFORE, for and in consideration of the sum of Ten and No/100ths Dollars ($10.00) in hand paid, the premises contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Guarantor and Bank hereby agree as follows:

1.CONFIRMATION OF GUARANTY.  The Guarantor hereby confirms and agrees that the Guaranty guarantees all of the Obligations as defined in the Reimbursement Agreement.  The Guarantor and Bank agree that all references in the
Guaranty to (i) Bonds shall refer to "Fresh Advantage, Inc. Taxable Variable Rate Demand Bonds, Series 2001, issued in the original aggregate principal amount of $9,000,000"; (ii) Indenture shall refer to "Trust Indenture, dated as of February 1, 2001,
between Trustee and Issuer"; and (iii) Issuer shall refer to "Fresh Advantage, Inc."

Except as expressly amended hereby, each and every term of the Guaranty shall remain in full force and effect.

2.RATIFICATION AND CONSENT BY GUARANTOR.  Guarantor hereby (i) ratifies and affirms all of its obligations under the Guaranty, as amended hereby; and (ii) acknowledges that this Agreement shall not constitute or be
construed as a novation or release of the Guaranty or any other agreement relating to the Bonds.  

3.BINDING AGREEMENT.  This Amendment shall be binding upon and shall inure to the benefit of the parties hereto and their respective heirs, successors, and assigns.

4.GEORGIA LAW.  This Amendment shall be governed by and interpreted in accordance with the laws of the State of Georgia.

IN WITNESS WHEREOF, the parties hereto have caused these presents to be executed under seal as of the date first above written.

	 	 	
GUARANTOR:

PERFORMANCE FOOD GROUP COMPANY

 

By:________________________________

    Name:

    Title:Exhibit10_38

Exhibit 10.38

AMENDMENT NO. 1 TO IRREVOCABLE LETTER OF CREDIT NO. SM407968C

 

First Union National Bank, as trustee

800 East Main, Lower Mezzanine

Richmond, Virginia 23219

Attention:  Corporate Trust Department

Ladies and Gentleman:

We hereby amend our irrevocable letter of credit no. SM407968C (the "Letter of Credit") as follows:  

All references in the Letter of Credit and its Appendices to (i) Bonds shall refer to "Fresh Advantage, Inc. Taxable Variable Rate Demand Bonds, Series 2001, issued in the original aggregate principal amount of $9,000,000"; (ii) Indenture shall refer
to "Trust Indenture, dated as of February 1, 2001, between Trustee and Issuer"; (iii) Issuer shall refer to "Fresh Advantage, Inc."; and (iv) Pledge Agreement shall refer to "Pledge Agreement, dated as of February 1, 2001, between the Bank and the Borrower.
"

All other terms and conditions of the Letter of Credit shall remain in full force and effect.  

Very truly yours,

FIRST UNION NATIONAL BANK

 

By:________________________________

     Name:

     Title:

DATE:_____________EXECUTION COPY
================================================================================

                                CREDIT AGREEMENT

                           Dated as of April 30, 2001

                                  by and among

                             HRPT Properties Trust,
                                                    as Borrower

                                   FIRST UNION

                                SECURITIES, INC.,
                                                    as Lead Arranger,

                              FLEET NATIONAL BANK,
                                                    as Co-Lead Arranger,

                           FIRST UNION NATIONAL BANK,
                                                    as Administrative Agent,

                     WELLS FARGO BANK, NATIONAL ASSOCIATION,
                                                    as Syndication Agent,

                                     Each of
                COMMERZBANK AKTIENGESELLSCHAFT, NEW YORK BRANCH,
                              THE BANK OF NEW YORK,
                                       and
                              FLEET NATIONAL BANK,
                                                    as Documentation Agents,

                                       and

                     The financial institutions party hereto
                    and their assignees under Section 12.5.,
                                                    as Lenders
================================================================================

<PAGE>
<TABLE>
<CAPTION>

                                TABLE OF CONTENTS

<S>       <C>                                                                                    <C>

Article I. Definitions............................................................................1

         Section 1.1.  Definitions................................................................1
         Section 1.2.  General; References to Times..............................................23

Article II. Credit Facility......................................................................23

         Section 2.1.  Revolving Loans...........................................................23
         Section 2.2.  Bid Rate Loans............................................................24
         Section 2.3.  Swingline Loans...........................................................27
         Section 2.4.  Letters of Credit.........................................................30
         Section 2.5.  Rates and Payment of Interest on Loans....................................33
         Section 2.6.  Number of Interest Periods................................................34
         Section 2.7.  Repayment of Loans........................................................34
         Section 2.8.  Prepayments...............................................................35
         Section 2.9.  Continuation..............................................................35
         Section 2.10.  Conversion...............................................................36
         Section 2.11.  Notes....................................................................36
         Section 2.12.  Voluntary Reductions of the Commitment...................................37
         Section 2.13.  Earlier Termination Date.................................................37
         Section 2.14.  Expiration or Maturity Date of Letters of Credit Past
                         Termination Date........................................................37
         Section 2.15.  Amount Limitations.......................................................37
         Section 2.16.  Increase of Commitments..................................................38

Article III. Payments, Fees and Other General Provisions.........................................39

         Section 3.1.  Payments..................................................................39
         Section 3.2.  Pro Rata Treatment........................................................39
         Section 3.3.  Sharing of Payments, Etc..................................................40
         Section 3.4.  Several Obligations.......................................................40
         Section 3.5.  Minimum Amounts...........................................................41
         Section 3.6.  Fees......................................................................41
         Section 3.7.  Computations..............................................................42
         Section 3.8.  Usury.....................................................................42
         Section 3.9.  Agreement Regarding Interest and Charges..................................42
         Section 3.10.  Statements of Account....................................................42
         Section 3.11.  Defaulting Lenders.......................................................43
         Section 3.12.  Taxes....................................................................44

Article IV. Yield Protection, Etc................................................................46

         Section 4.1.  Additional Costs; Capital Adequacy........................................46
         Section 4.2.  Suspension of LIBOR Loans.................................................47
         Section 4.3.  Illegality................................................................47
         Section 4.4.  Compensation..............................................................48
         Section 4.5.  Affected Lenders..........................................................48
         Section 4.6.  Treatment of Affected Loans...............................................49
</TABLE>

                                      -i-
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<TABLE>
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<S>       <C>                                                                                    <C>

         Section 4.7.  Change of Lending Office..................................................49
         Section 4.8.  Assumptions Concerning Funding of LIBOR Loans.............................50

Article V. Conditions Precedent..................................................................50

         Section 5.1.  Initial Conditions Precedent..............................................50
         Section 5.2.  Conditions Precedent to All Loans and Letters of Credit...................52
         Section 5.3.  Conditions as Covenants...................................................53

Article VI. Representations and Warranties.......................................................53

         Section 6.1.  Representations and Warranties............................................53
         Section 6.2.  Survival of Representations and Warranties, Etc...........................59

Article VII. Affirmative Covenants...............................................................59

         Section 7.1.  Preservation of Existence and Similar Matters.............................59
         Section 7.2.  Compliance with Applicable Law and Material Contracts.....................60
         Section 7.3.  Maintenance of Property...................................................60
         Section 7.4.  Conduct of Business.......................................................60
         Section 7.5.  Insurance.................................................................60
         Section 7.6.  Payment of Taxes and Claims...............................................60
         Section 7.7.  Visits and Inspections....................................................61
         Section 7.8.  Use of Proceeds; Letters of Credit........................................61
         Section 7.9.  Environmental Matters.....................................................61
         Section 7.10.  Books and Records........................................................62
         Section 7.11.  Further Assurances.......................................................62
         Section 7.12.  New Subsidiaries/Guarantors..............................................62
         Section 7.13.  REIT Status..............................................................63
         Section 7.14.  Exchange Listing.........................................................63

Article VIII. Information........................................................................63

         Section 8.1.  Quarterly Financial Statements............................................63
         Section 8.2.  Year-End Statements.......................................................63
         Section 8.3.  Compliance Certificate....................................................64
         Section 8.4.  Other Information.........................................................64

Article IX. Negative Covenants...................................................................66

         Section 9.1.  Financial Covenants.......................................................66
         Section 9.2.  Indebtedness..............................................................67
         Section 9.3.  Certain Permitted Investments.............................................67
         Section 9.4.  Investments Generally.....................................................68
         Section 9.5.  Liens; Negative Pledges; Other Matters....................................69
         Section 9.6.  Restricted Payments.......................................................70
         Section 9.7.  Merger, Consolidation, Sales of Assets and Other Arrangements.............70
         Section 9.8.  Fiscal Year...............................................................71
         Section 9.9.  Modifications to Advisory Agreement and Other Material Contracts..........71
         Section 9.10.  Transactions with Affiliates.............................................71
</TABLE>

                                      -ii-
<PAGE>
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<S>       <C>                                                                                    <C>

         Section 9.11.  ERISA Exemptions.........................................................71

Article X. Default...............................................................................72

         Section 10.1.  Events of Default........................................................72
         Section 10.2.  Remedies Upon Event of Default...........................................75
         Section 10.3.  Remedies Upon Default....................................................77
         Section 10.4.  Allocation of Proceeds...................................................77
         Section 10.5.  Collateral Account.......................................................77
         Section 10.6.  Performance by Agent.....................................................78
         Section 10.7.  Rights Cumulative........................................................78

Article XI. The Agent............................................................................79

         Section 11.1.  Authorization and Action.................................................79
         Section 11.2.  Agent's Reliance, Etc....................................................79
         Section 11.3.  Notice of Defaults.......................................................80
         Section 11.4.  First Union as Lender....................................................80
         Section 11.5.  Approvals of Lenders.....................................................81
         Section 11.6.  Lender Credit Decision, Etc..............................................81
         Section 11.7.  Indemnification of Agent.................................................82
         Section 11.8.  Successor Agent..........................................................82
         Section 11.9.  Titled Agents............................................................83

Article XII. Miscellaneous.......................................................................83

         Section 12.1.  Notices..................................................................83
         Section 12.2.  Expenses.................................................................84
         Section 12.3.  Setoff...................................................................85
         Section 12.4.  Litigation; Jurisdiction; Other Matters; Waivers.........................85
         Section 12.5.  Successors and Assigns...................................................86
         Section 12.6.  Amendments...............................................................89
         Section 12.7.  Nonliability of Agent and Lenders........................................90
         Section 12.8.  Confidentiality..........................................................91
         Section 12.9.  Indemnification..........................................................91
         Section 12.10.  Termination; Survival...................................................93
         Section 12.11.  Severability of Provisions..............................................93
         Section 12.12.  GOVERNING LAW...........................................................93
         Section 12.13.  Counterparts............................................................93
         Section 12.14.  Obligations with Respect to Loan Parties................................94
         Section 12.15.  Limitation of Liability.................................................94
         Section 12.16.  Entire Agreement........................................................94
         Section 12.17.  Construction............................................................94
         SECTION 12.18.  LIABILITY OF TRUSTEES, ETC..............................................94

</TABLE>

SCHEDULE 1.1(A)                List of Loan Parties
SCHEDULE 1.1(B)                Terms of Subordination
SCHEDULE 6.1.(b)               Ownership Structure
SCHEDULE 6.1.(f)               Title to Properties; Liens

                                     -iii-
<PAGE>

SCHEDULE 6.1.(g)               Indebtedness and Guaranties
SCHEDULE 6.1.(h)               Material Contracts
SCHEDULE 6.1.(i)               Litigation
SCHEDULE 6.1.(k)               Financial Statements
SCHEDULE 6.1.(y)               List of Unencumbered Assets
SCHEDULE 9.4.                  Existing Investments

EXHIBIT A                      Form of Assignment and Acceptance Agreement
EXHIBIT B                      Form of Designation Agreement
EXHIBIT C                      Form of Notice of Borrowing
EXHIBIT D                      Form of Notice of Continuation
EXHIBIT E                      Form of Notice of Conversion
EXHIBIT F                      Form of Notice of Swingline Borrowing
EXHIBIT G                      Form of Swingline Note
EXHIBIT H                      Form of Bid Rate Quote Request
EXHIBIT I                      Form of Bid Rate Quote
EXHIBIT J                      Form of Bid Rate Quote Acceptance
EXHIBIT K                      Form of Revolving Note
EXHIBIT L                      Form of Bid Rate Note
EXHIBIT M                      Form of Cancellation Request
EXHIBIT N-1                    Form of Opinion of Counsel
EXHIBIT N-2                    Form of Opinion of Special Counsel
EXHIBIT O                      Form of Compliance Certificate
EXHIBIT P                      Form of Guaranty

                                      -iv-
<PAGE>

         THIS  CREDIT  AGREEMENT  dated as of April 30,  2001 by and among  HRPT
Properties Trust, a real estate investment trust organized under the laws of the
State of Maryland (the "Borrower"), each of the financial institutions initially
a signatory hereto together with their assignees  pursuant to Section  12.5.(d),
First Union  National  Bank,  as Agent,  FIRST UNION  SECURITIES,  INC., as Lead
Arranger,  FLEET NATIONAL BANK, as Co-Lead Arranger,  WELLS FARGO BANK, NATIONAL
ASSOCIATION,  as Syndication Agent, and each of COMMERZBANK  AKTIENGESELLSCHAFT,
NEW YORK BRANCH,  THE BANK OF NEW YORK and FLEET NATIONAL BANK, as Documentation
Agents.

         WHEREAS,  the Agent and the  Lenders  desire to make  available  to the
Borrower a revolving  credit  facility in the  initial  amount of  $425,000,000,
which will include a $40,000,000  letter of credit subfacility and a $25,000,000
swingline subfacility, on the terms and conditions contained herein.

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

                             ARTICLE I. DEFINITIONS

Section 1.1.  Definitions.

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

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

         "Additional Costs" has the meaning given that term in Section 4.1.

         "Adjusted  EBITDA" means, with respect to any period of time, EBITDA of
the Borrower and its  Subsidiaries  determined on a consolidated  basis for such
period less Capital Expenditures Reserves for all Properties for such period.

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

         "Advisory  Agreement" means that certain Advisory Agreement dated as of
January 1, 1998 by and between the Borrower and RMR.

         "Affiliate" means any Person (other than the Agent or any Lender):  (a)
directly or indirectly controlling, controlled by, or under common control with,
the Borrower;  (b) directly or
<PAGE>

indirectly  owning or holding ten percent (10.0%) or more of any Equity Interest
in the  Borrower;  or (c) ten percent  (10.0%) or more of whose  voting stock or
other Equity  Interest is directly or indirectly  owned or held by the Borrower.
For purposes of this definition, "control" (including with correlative meanings,
the terms "controlling",  "controlled by" and "under common control with") means
the  possession  directly  or  indirectly  of the  power to  direct or cause the
direction  of the  management  and  policies  of a Person,  whether  through the
ownership of voting securities or by contract or otherwise.  The Affiliates of a
Person shall include any officer or director of such Person.

         "Agent" means First Union National Bank, as contractual  representative
for the Lenders under the terms of this Agreement, and any of its successors.

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

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

         "Applicable  Margin" means the percentage per annum determined,  at any
time, based on the range into which the Borrower's  Credit Rating then falls, in
accordance with the table set forth below.  Any change in the Borrower's  Credit
Rating  which would  cause it to move to a  different  Level in such table shall
effect a change in the  Applicable  Margin  on the  Business  Day on which  such
change occurs.  During any period that the Borrower has received  Credit Ratings
that are not equivalent,  the Applicable Margin shall be determined by the lower
of such two Credit  Ratings.  During any period for which the  Borrower  has not
received a Credit Rating from a Rating Agency,  then the Applicable Margin shall
be determined as Level 5. As of the Agreement  Date,  the  Applicable  Margin is
determined based on Level 3.

        Borrower's Credit Rating         Applicable Margin   Applicable Margin
Level     (S&P/Moody's (other))           for LIBOR  Loans   for Base Rate Loans
-------------------------------------------------------------------------------
  1      A-/A3 (or equivalent)                 0.65%                0.0%
  2      BBB+/Baa1 (or equivalent)             0.70%                0.0%
  3      BBB/Baa2 (or equivalent)              0.80%                0.0%
  4      BBB-/Baa3 (or equivalent)             0.95%                0.15%
  5      <  BBB-/Baa3 (or equivalent)          1.40%                0.35%

         "Asset Under Development"  means, as of any date of determination,  any
Property on which  construction of new  income-producing  improvements  has been
commenced and is continuing.  If such construction  consists of the construction
of tenant improvements,  as opposed to expansion of such Property or any "ground
up"  development,  such  Property  shall not be  considered to be an Asset Under
Development.   In   addition,   to  the   extent   any   Property   includes   a
revenue-generating  component (e.g. an existing building leased to a tenant) and
a building under  development,  such  revenue-generating  component shall not be
considered to be an Asset Under  Development but such building under development
shall be considered to be an Asset Under Development.

                                       -2-
<PAGE>

         "Assignee" has the meaning given that term in Section 12.5.(d).

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

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

         "Base Rate Loan" means a Loan  bearing  interest at a rate based on the
Base Rate.

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

         "Bid Rate" has the meaning given that term in Section 2.2.(c)(ii)(C).

         "Bid  Rate  Borrowing"  has the  meaning  given  that  term in  Section
2.2.(b).

         "Bid Rate Loan" means a loan made by a Lender under Section 2.2.

         "Bid Rate Notes" has the meaning given that term in Section 2.11.(b).

         "Bid Rate Quote" means an offer in accordance with Section 2.2.(c) by a
Lender to make a Bid Rate Loan with one single specified interest rate.

         "Bid Rate Quote  Request"  has the  meaning  given that term in Section
2.2.(b).

         "Borrower"  has the  meaning  set forth in the  introductory  paragraph
hereof and shall include the Borrower's successors and permitted assigns.

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

         "Cancellation Request" has the meaning given that term in Section 2.13.

         "Capital  Expenditure  Reserves" means,  with respect to a Property and
for a given period, an amount equal to (a) the aggregate rentable square footage
of all completed space of such Property,  times (b) $0.75,  times (c) the number
of days in such period, divided by (d) 365.

                                      -3-
<PAGE>

         "Capitalized  Lease Obligation" means obligations under a lease that is
required to be capitalized for financial  reporting  purposes in accordance with
GAAP. The amount of a Capitalized Lease Obligation is the capitalized  amount of
such obligation determined in accordance with GAAP.

         "Cash Equivalents" means: (a) securities issued,  guaranteed or insured
by the United  States of America or any of its agencies  with  maturities of not
more than one year from the date  acquired;  (b)  certificates  of deposit  with
maturities of not more than one year from the date  acquired  issued by a United
States federal or state chartered commercial bank of recognized  standing,  or a
commercial  bank organized under the laws of any other country which is a member
of the  Organization for Economic  Cooperation and  Development,  or a political
subdivision of any such country,  acting through a branch or agency,  which bank
has capital and unimpaired surplus in excess of  $500,000,000.00  and which bank
or its holding company has a short-term  commercial paper rating of at least A-2
or the  equivalent  by S&P or at least P-2 or the  equivalent  by  Moody's;  (c)
reverse  repurchase  agreements  with terms of not more than seven days from the
date  acquired,  for  securities  of the type  described in clause (a) above and
entered into only with commercial banks having the  qualifications  described in
clause (b) above; (d) commercial paper issued by any Person  incorporated  under
the laws of the United States of America or any State thereof and rated at least
A-2 or the equivalent  thereof by S&P or at least P-2 or the equivalent  thereof
by Moody's, in each case with maturities of not more than one year from the date
acquired;  and (e)  investments  in money  market  funds  registered  under  the
Investment   Company   Act  of  1940,   which   have  net  assets  of  at  least
$500,000,000.00 and at least 85% of whose assets consist of securities and other
obligations of the type described in clauses (a) through (d) above.

         "Collateral  Account"  means a  special  non-interest  bearing  deposit
account  maintained  by the  Agent at the  Principal  Office  and under its sole
dominion and control.

         "Commitment" means, as to each Lender, such Lender's obligation to make
Revolving Loans pursuant to Section 2.1. and to issue (in the case of the Agent)
or  participate  in (in the case of the Lenders)  Letters of Credit  pursuant to
Section 2.4.(a) and 2.4.(i), respectively, in an amount up to, but not exceeding
(but in the case of the  Lender  acting as the  Agent  excluding  the  aggregate
amount of  participations  in the Letters of Credit held by other Lenders),  the
amount set forth for such Lender on its  signature  page hereto as such Lender's
"Commitment Amount" or as set forth in the applicable  Assignment and Acceptance
Agreement,  as the same may be  reduced  from time to time  pursuant  to Section
2.12. or as appropriate to reflect any assignments to or by such Lender effected
in accordance with Section 12.5.

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

         "Compliance  Certificate"  has the  meaning  given that term in Section
8.3.

                                      -4-
<PAGE>

         "Continue",   "Continuation"   and  "Continued"   each  refers  to  the
continuation of a LIBOR Loan from one Interest Period to another Interest Period
pursuant to Section 2.9.

         "Convert",  "Conversion"  and "Converted" each refers to the conversion
of a Loan of one Type into a Loan of another Type pursuant to Section 2.10.

         "Credit  Event" means any of the  following:  (a) the making (or deemed
making) of any Loan,  (b) the  Conversion  of a Loan and (c) the  issuance  of a
Letter of Credit.

         "Credit  Rating" means the lowest rating assigned by a Rating Agency to
each series of rated senior unsecured long term indebtedness of the Borrower.

         "Debt Service" means, for any period,  the sum of: (a) Interest Expense
of the Borrower and its Subsidiaries determined on a consolidated basis for such
period  and  (b)  all  regularly   scheduled   payments  made  with  respect  to
Indebtedness of the Borrower and its Subsidiaries during such period, other than
any balloon,  bullet or similar principal payment which repays such Indebtedness
in full.

         "Default" means any of the events  specified in Section 10.1.,  whether
or not there has been satisfied any  requirement  for the giving of notice,  the
lapse of time, or both.

         "Defaulting Lender" has the meaning set forth in Section 3.11.

         "Designated  Lender"  means a  special  purpose  corporation  which  is
sponsored  by a Lender,  that is  engaged  in making,  purchasing  or  otherwise
investing in  commercial  loans in the ordinary  course of its business and that
issues (or the parent of which issues)  commercial  paper rated at least P-1 (or
the then equivalent  grade) by Moody's or A-1 (or the then equivalent  grade) by
S&P that, in either case,  (a) is organized  under the laws of the United States
of America or any state thereof, (b) shall have become a party to this Agreement
pursuant to Section 12.5.(e) and (c) is not otherwise a Lender.

         "Designated  Lender  Note"  means  a Bid  Rate  Note  of  the  Borrower
evidencing  the  obligation  of the  Borrower  to repay Bid Rate Loans made by a
Designated Lender.

         "Designating  Lender"  has the  meaning  given  that  term  in  Section
12.5.(e).

         "Designation  Agreement" means a Designation Agreement between a Lender
and a Designated Lender and accepted by the Agent,  substantially in the form of
Exhibit B or such other form as may be agreed to by such Lender, such Designated
Lender and the Agent.

         "Developable  Property"  means (a) any  Property  on which there are no
improvements or (b) any Property (or portion  thereof)  acquired by the Borrower
or any Subsidiary for the purpose of being developed.

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

                                      -5-
<PAGE>

         "EBITDA"  means,  with respect to a Person for a given period:  (a) net
earnings (or loss) of such Person for such period  determined on a  consolidated
basis  exclusive of the following (to the extent  included in  determination  of
such net earnings  (loss)):  (i)  depreciation and  amortization  expense;  (ii)
Interest Expense;  (iii) income tax expense; (iv) extraordinary or non-recurring
gains and  losses;  and (v) in the case of the  Borrower  and its  Subsidiaries,
equity  in the  earnings  (or  loss)  of SNH and HPT  and  other  Unconsolidated
Affiliates;  plus  (b) in the case of the  Borrower  and its  Subsidiaries  cash
dividends (other than extraordinary cash dividends or distributions) received by
the Borrower or its  Subsidiaries  from SNH or HPT during such period;  plus (c)
such  Person's pro rata share of EBITDA of its  Unconsolidated  Affiliates.  For
purposes of determining the EBITDA of the Borrower and its Subsidiaries,  EBITDA
not  attributable  to operations  or assets of the Borrower or its  Subsidiaries
located in the United  States of America  shall be excluded.  Straight line rent
leveling  adjustments required under GAAP shall be disregarded in determinations
of EBITDA.

         "Effective  Date" means the later of: (a) the Agreement  Date;  and (b)
the date on which all of the  conditions  precedent  set forth in  Section  5.1.
shall have been fulfilled or waived in writing by the Requisite Lenders.

         "Eligible  Assignee"  means any Person who is: (i)  currently a Lender;
(ii) a commercial bank,  trust company,  insurance  company,  investment bank or
pension fund  organized  under the laws of the United States of America,  or any
state  thereof,  and having  total assets in excess of  $5,000,000,000;  (iii) a
savings and loan  association  or savings bank  organized  under the laws of the
United States of America, or any state thereof,  and having a tangible net worth
of at least $500,000,000;  or (iv) a commercial bank organized under the laws of
any other country which is a member of the Organization for Economic Cooperation
and  Development,  or a political  subdivision  of any such country,  and having
total  assets in excess of  $10,000,000,000,  provided  that such bank is acting
through a branch or agency  located in the  United  States of  America.  If such
Person is not  currently a Lender,  such  Person's  senior  unsecured  long term
indebtedness  must be rated BBB or higher by S&P, Baa2 or higher by Moody's,  or
the  equivalent  or higher of  either  such  rating  by  another  Rating  Agency
acceptable to the Agent.  Notwithstanding  the  foregoing,  during any period in
which an Event of Default  shall have  occurred and be  continuing  under any of
subsections (a), (b), (f) or (g) of Section 10.1., the term "Eligible  Assignee"
shall mean any Person that is not an individual.

         "Environmental Laws" means any Applicable Law relating to environmental
protection  or the  manufacture,  storage,  disposal or  clean-up  of  Hazardous
Materials  including,  without  limitation,  the  following:  Clean Air Act,  42
U.S.C.ss.7401 et seq.;  Federal Water Pollution Control Act, 33 U.S.C.ss.1251 et
seq.;  Solid Waste  Disposal  Act, as amended by the Resource  Conservation  and
Recovery Act, 42 U.S.C.ss. 6901 et seq.;  Comprehensive  Environmental Response,
Compensation   and  Liability   Act,  42  U.S.C.ss.   9601  et  seq.;   National
Environmental  Policy  Act,  42  U.S.C.ss.  4321  et  seq.;  regulations  of the
Environmental  Protection  Agency and any applicable  rule of common law and any
judicial  interpretation  thereof  relating  primarily  to  the  environment  or
Hazardous Materials.

                                      -6-
<PAGE>

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

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

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

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

         "Event of Default" means any of the events  specified in Section 10.1.,
provided that any requirement for notice or lapse of time or any other condition
has been satisfied.

         "Excluded  Subsidiary"  means  any  Subsidiary  (a)  which  has a legal
structure  and  capitalization  intended to make such  entity a single  purpose,
"bankruptcy  remote"  entity;  and  (b) for  which  none  of the  Borrower,  any
Subsidiary (other than another Excluded  Subsidiary) or any other Loan Party has
Guaranteed any of the  Indebtedness or  Subordinated  Debt of such Subsidiary or
has any direct  obligation to maintain or preserve such  Subsidiary's  financial
condition  or to cause  such  Subsidiary  to  achieve  any  specified  levels of
operating results, except for customary exceptions for fraud,  misapplication of
funds,  environmental  indemnities,  and other  similar  exceptions  to recourse
liability.

         "Existing  Credit  Agreement"  means that  certain  Fourth  Amended and
Restated  Revolving  Loan  Agreement  dated as of April 2, 1998 by and among the
Borrower,  the  financial  institutions  party  thereto as  "Lenders",  Dresdner
Kleinwort  Benson  North  America  LLC,  as  Agent,   Fleet  National  Bank,  as
Administrative Agent, and certain Subsidiaries of the Borrower.

         "Facility  Fee" means the per annum  percentage  set forth in the table
below  corresponding to the Level at which the "Applicable Margin" is determined
in accordance with the definition thereof:

                                      -7-
<PAGE>

                     Level                Facility Fee
                ----------------------------------------
                       1                      0.15%
                       2                      0.20%
                       3                      0.20%
                       4                      0.20%
                       5                      0.30%

As of the Agreement Date, the Facility Fee equals 0.20%.

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

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

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

         "First  Union"  means  First Union  National  Bank,  together  with its
successors and assigns.

         "Fitch" means Fitch, Inc. and its successors.

         "Fixed Charges" means, for any period, the sum (without duplication) of
(a) Debt Service for such period and (b) Preferred Dividends for such period.

         "Floating  Rate Debt" means all  Indebtedness  of the  Borrower and its
Subsidiaries  which bears interest at fluctuating  rates (and in any event shall
include all Loans and other  Indebtedness  of the Borrower under any of the Loan
Documents)  and for which the Borrower or any such  Subsidiary  has not obtained
Interest Rate  Agreements  which  effectively  cause such  variable  rates to be
equivalent to fixed rates less than or equal to 10.0% per annum.

         "Funds  From  Operations"  means,  for any  period,  net  income of the
Borrower for such period  determined on a consolidated  basis,  exclusive of the
following (to the extent included in the determination of such net income):  (a)
depreciation  and  amortization;  (b) gains and  losses

                                      -8-
<PAGE>
from extraordinary or non-recurring items; (c) gains and losses on sales of real
estate;  (d) gains and  losses on  investments  in  marketable  securities;  (e)
provisions/benefits  for  income  taxes  for such  period;  and (f)  Funds  From
Operations  attributable to any Investment held, directly or indirectly,  by the
Borrower in HPT and SNH;  provided,  however,  cash dividends in respect of such
Investments  in HPT and SNH that have been actually  received by the Borrower or
any  Subsidiary  during  such  period,  shall not be  excluded  from  Funds From
Operation by virtue of this clause (f).

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

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

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

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

         "Guaranty", "Guaranteed" or to "Guarantee" as applied to any obligation
means and  includes:  (a) a guaranty  (other than by  endorsement  of negotiable
instruments  for  collection in the ordinary  course of  business),  directly or
indirectly,  in any  manner,  of any part or all of such  obligation,  or (b) an
agreement,  direct or  indirect,  contingent  or  otherwise,  and whether or not
constituting a guaranty,  the practical effect of which is to assure the payment
or  performance  (or payment of damages in the event of  nonperformance)  of any
part or all of such  obligation  whether by: (i) the purchase of  securities  or
obligations,  (ii) the purchase, sale or lease (as lessee or lessor) of property
or the  purchase or sale of services  primarily  for the purpose of enabling the
obligor with respect to such  obligation to make any payment or performance  (or
payment of damages in the event of  nonperformance) of or on account of any part
or all of such  obligation,  or to assure the owner of such  obligation  against
loss,  (iii) the  supplying of funds to or in any other manner  investing in the
obligor with respect to such obligation, (iv) repayment of amounts drawn down by
beneficiaries  of letters of credit  (including  Letters of Credit),  or (v) the
supplying  of funds to or investing in a Person on account of all or any part of
such Person's  obligation  under a Guaranty of any obligation or indemnifying or
holding  harmless,  in any  way,  such  Person  against  any part or all of such
obligation. As the context requires,  "Guaranty" shall also mean the Guaranty to
which the Guarantors are parties substantially in the form of Exhibit P.

                                      -9-
<PAGE>

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

         "HPT" means Hospitality  Properties Trust, together with its successors
and assigns.

         "Indebtedness"  means,  with  respect  to a  Person,  at  the  time  of
computation  thereof,  all of  the  following  (without  duplication):  (a)  all
obligations of such Person in respect of money borrowed;  (b) all obligations of
such Person, whether or not for money borrowed (i) represented by notes payable,
or drafts  accepted,  in each  case  representing  extensions  of  credit,  (ii)
evidenced  by  bonds,  debentures,   notes  or  similar  instruments,  or  (iii)
constituting  purchase money  indebtedness,  conditional sales contracts,  title
retention  debt  instruments or other similar  instruments,  upon which interest
charges  are  customarily  paid or that are issued or assumed as full or partial
payment for property or services rendered;  (c) Capitalized Lease Obligations of
such Person; (d) all reimbursement  obligations of such Person under any letters
of credit or  acceptances  (whether  or not the same  have  been  presented  for
payment); (e) all obligations, contingent or otherwise, of such Person under any
synthetic  lease,  tax  retention  operating  lease,  off balance  sheet loan or
similar off balance sheet financing  arrangement if the transaction  giving rise
to such  obligation  (i) is considered  indebtedness  for borrowed money for tax
purposes but is  classified  as an operating  lease under GAAP and (ii) does not
(and is not  required to pursuant to GAAP)  appear as a liability on the balance
sheet of such Person;  (f) all  obligations of such Person to purchase,  redeem,
retire,  defease or  otherwise  make any  payment in respect of any  Mandatorily
Redeemable  Stock  issued  by such  Person or any  other  Person,  valued at the
greater of its voluntary or involuntary  liquidation preference plus accrued and
unpaid dividends;  (g) all obligations of such Person in respect of any take-out
commitment or forward equity commitment (excluding,  in the case of the Borrower
and its  Subsidiaries,  any such obligation that can be satisfied  solely by the
issuance of Equity Interests (other than Mandatorily Redeemable Stock)); (h) all
Indebtedness  of other Persons which such Person has  Guaranteed or is otherwise
recourse to such Person;  (i) all  Indebtedness of another Person secured by (or
for which the holder of such  Indebtedness has an existing right,  contingent or
otherwise,  to be  secured  by) any Lien on  property  or  assets  owned by such
Person, even though such Person has not assumed or become liable for the payment
of such  Indebtedness or other payment  obligation,  valued,  in the case of any
such  Indebtedness  as to which  recourse  for the payment  thereof is expressly
limited to the  property or assets on which such Lien is granted,  at the lesser
of (x) the stated or determinable  amount of the Indebtedness that is so secured
or, if not stated or determinable,  the maximum reasonably anticipated liability
in respect thereof (assuming such Person is required to perform  thereunder) and
(y) the Fair Market Value of such property or assets;  and (j) such Person's pro

                                      -10-
<PAGE>

rata share of the Indebtedness of any  Unconsolidated  Affiliate of such Person.
In the case of the Borrower and its Subsidiaries, Subordinated Debt shall not be
considered Indebtedness.

         "Intellectual  Property"  has the  meaning  given  that term in Section
6.1.(t).

         "Interest  Expense"  means,  with respect to a Person for any period of
time, (a) the interest expense,  whether paid,  accrued or capitalized  (without
deduction of consolidated  interest  income) of such Person for such period plus
(b) in the case of the  Borrower,  the  Borrower's  pro rata  share of  Interest
Expense of its Unconsolidated Affiliates.

         "Interest Period" means:

         (a) with respect to any LIBOR Loan, each period  commencing on the date
such LIBOR Loan is made or the last day of the next  preceding  Interest  Period
for such Loan and ending 7, 30 or 90 days thereafter, as the Borrower may select
in a Notice of Borrowing, Notice of Continuation or Notice of Conversion, as the
case may be,  except that each Interest  Period of 30 or 90 day's  duration that
commences  on the last  Business  Day of a calendar  month shall end on the last
Business Day of the appropriate subsequent calendar month; and

         (b) with  respect to any Bid Rate Loan,  the period  commencing  on the
date such Bid Rate Loan is made and ending on any  Business  Day not less than 7
nor more than 90 days  thereafter,  as the  Borrower  may select as  provided in
Section 2.2.(b).

Notwithstanding  the foregoing:  (i) if any Interest  Period would otherwise end
after the  Termination  Date,  such Interest Period shall end on the Termination
Date; and (ii) each Interest  Period that would  otherwise end on a day which is
not a Business  Day shall end on the next  succeeding  Business Day (or, if such
next succeeding Business Day falls in the next succeeding calendar month, on the
next preceding Business Day).

         "Interest  Rate  Agreement"  means any  interest  rate swap  agreement,
interest rate cap  agreement,  interest  rate collar  agreement or other similar
contractual  agreement or arrangement entered into with a nationally  recognized
financial  institution then having an Investment Grade Rating for the purpose of
protecting against fluctuations in interest rates.

         "Internal  Revenue  Code" means the Internal  Revenue Code of 1986,  as
amended.

         "Investment"  means, (x) with respect to any Person, any acquisition or
investment  (whether or not of a controlling  interest) by such Person, by means
of any of the  following:  (a) the purchase or other  acquisition  of any Equity
Interest  in another  Person,  (b) a loan,  advance or  extension  of credit to,
capital  contribution  to,  Guaranty  of  Indebtedness  of, or purchase or other
acquisition of any Indebtedness of, another Person, including any partnership or
joint  venture  interest  in such other  Person,  or (c) the  purchase  or other
acquisition  (in one  transaction  or a series  of  transactions)  of  assets of
another  Person that  constitute the business or a division or operating unit of
another  Person  and (y)  with  respect  to any  Property  or other  asset,  the
acquisition  thereof.  Any commitment to make an Investment in any other Person,
as well as any option of another Person to require an Investment in such Person,
shall  constitute an Investment.

                                      -11-
<PAGE>

Except as expressly provided otherwise,  for purposes of determining  compliance
with any covenant  contained in a Loan  Document,  the amount of any  Investment
shall  be the  amount  actually  invested,  without  adjustment  for  subsequent
increases or decreases in the value of such Investment.

         "Investment  Grade  Rating"  means a Credit  Rating  of  BBB-/Baa3  (or
equivalent) from both Rating Agencies.

         "L/C Commitment Amount" equals $40,000,000.

         "Lender"  means  each  financial  institution  from time to time  party
hereto as a "Lender" or a  "Designated  Lender,"  together  with its  respective
successors  and permitted  assigns;  provided,  however,  that the term "Lender"
shall  exclude each  Designated  Lender when used in reference to any Loan other
than a Bid Rate Loan, the Commitments or terms relating to any Loan other than a
Bid Rate Loan and the  Commitments  and shall  further  exclude each  Designated
Lender  for all  other  purposes  under  the  Loan  Documents  except  that  any
Designated  Lender  which  funds a Bid  Rate  Loan  shall,  subject  to  Section
12.5.(e),  have the rights  (including the rights given to a Lender contained in
Sections 12.2. and 12.9.) and  obligations of a Lender  associated  with holding
such Bid Rate Loan.

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

         "Letter of Credit" has the meaning given that term in Section 2.4.(a).

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

         "Letter of Credit Liabilities" means, without duplication,  at any time
and in respect of any Letter of Credit, the sum of (a) the Stated Amount of such
Letter  of  Credit  plus  (b)  the  aggregate  unpaid  principal  amount  of all
Reimbursement  Obligations  of the  Borrower  at such  time due and  payable  in
respect of all drawings  made under such Letter of Credit.  For purposes of this
Agreement,  a Lender (other than the Lender acting as the Agent) shall be deemed
to hold a Letter of Credit  Liability  in an amount  equal to its  participation
interest in the related Letter of Credit under Section  2.4.(i),  and the Lender
acting as the Agent shall be deemed to hold a Letter of Credit  Liability  in an
amount  equal to its  retained  interest in the related  Letter of Credit  after
giving effect to the  acquisition by the Lenders other than the Lender acting as
the Agent of their participation interests under such Section.

         "LIBOR" means, for any LIBOR Loan for any Interest Period therefor, the
rate per annum  (rounded  upwards,  if  necessary,  to the nearest  1/100 of 1%)
appearing on Telerate Page

                                      -12-
<PAGE>

3750 (or any successor page) as the London  interbank  offered rate for deposits
in Dollars at approximately  11:00 a.m. (London time) two Business Days prior to
the first day of such  Interest  Period for a term  comparable  to such Interest
Period.  If for any reason such rate is not  available,  the term "LIBOR"  shall
mean, for any LIBOR Loan for any Interest  Period  therefor,  the rate per annum
(rounded  upwards,  if  necessary,  to the nearest 1/100 of 1%) appearing on the
Reuters  Screen LIBO Page as the London  interbank  offered rate for deposits in
Dollars at approximately 11:00 a.m. (London time) two Business Days prior to the
first day of such Interest Period for a term comparable to such Interest Period;
provided, however, if more than one rate is specified on the Reuters Screen LIBO
Page, the applicable rate shall be the arithmetic mean of all such rates.

         "LIBOR Loans" means Loans bearing interest at a rate based on LIBOR.

         "Lien" as applied to the property of any Person means: (a) any security
interest,  encumbrance,  mortgage,  deed to secure debt, deed of trust,  pledge,
lien, charge or lease  constituting a Capitalized Lease Obligation,  conditional
sale or other title retention agreement,  or other security title or encumbrance
of any kind in respect of any  property  of such  Person,  or upon the income or
profits  therefrom;  (b) any  arrangement,  express or implied,  under which any
property of such Person is transferred,  sequestered or otherwise identified for
the purpose of subjecting the same to the payment of Indebtedness or performance
of any other  obligation  in priority to the payment of the  general,  unsecured
creditors of such Person;  (c) the filing of any financing  statement  under the
Uniform  Commercial  Code or its  equivalent in any  jurisdiction,  other than a
financing  statement  filed  (i)  in  respect  of a  lease  not  constituting  a
Capitalized  Lease  Obligation   pursuant  to  Section  9-408  (or  a  successor
provision)  of  the  Uniform  Commercial  Code  as in  effect  in an  applicable
jurisdiction or (ii) in connection with a sale or other  disposition of accounts
or other assets not prohibited by this Agreement in a transaction  not otherwise
constituting  or giving rise to a Lien;  and (d) any agreement by such Person to
grant, give or otherwise convey any of the foregoing.

         "Loan" means a Revolving Loan, a Bid Rate Loan or a Swingline Loan.

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

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

         "Management  Agreement" means that certain Master Management  Agreement
dated as of  December  31,  1997 by and  between  RMR and the  Borrower  and its
Subsidiaries.

         "Mandatorily  Redeemable Stock" means, with respect to any Person,  any
Equity Interest of such Person which by the terms of such Equity Interest (or by
the  terms of any  security  into  which it is  convertible  or for  which it is
exchangeable or  exercisable),  upon the happening of any event or otherwise (a)
matures or is mandatorily  redeemable,  pursuant to a

                                      -13-
<PAGE>

sinking fund  obligation or otherwise  (other than an Equity  Interest  which is
redeemable solely in exchange for common stock or other equivalent common Equity
Interests),   (b)  is  convertible  into  or  exchangeable  or  exercisable  for
Indebtedness or Mandatorily Redeemable Stock, or (c) is redeemable at the option
of the holder thereof,  in whole or in part (other than an Equity Interest which
is  redeemable  solely in exchange for common stock or other  equivalent  common
Equity  Interests),  in each case on or prior to the date on which all Revolving
Loans are scheduled to be due and payable in full.

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

         "Material Contract" means any contract or other arrangement (other than
Loan Documents),  whether written or oral, to which the Borrower, any Subsidiary
or any  other  Loan  Party is a party as to which  the  breach,  nonperformance,
cancellation  or  failure  to renew by any party  thereto  could  reasonably  be
expected to have a Material  Adverse Effect,  and in any event shall include the
Advisory Agreement and the Management Agreement with respect to the Borrower.

         "Material  Plan"  means at any time a Plan or  Plans  having  aggregate
Unfunded Liabilities in excess of $10,000,000.

         "Material  Subsidiary"  means any  Subsidiary  to which 2.0% or more of
Total Asset Value is, directly or indirectly, attributable.

         "Moody's" means Moody's Investors Service, Inc. and its successors.

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

         "Negative  Pledge" means a provision of any agreement  (other than this
Agreement or any other Loan  Document)  that prohibits or limits the creation or
assumption of any Lien on any assets of a Person or entitles  another  Person to
obtain or claim the  benefit of a Lien on any assets of such  Person;  provided,
however, that an agreement that establishes a maximum ratio of unsecured debt to
unencumbered  assets,  or of secured  debt to total  assets,  or that  otherwise
conditions a Person's ability to encumber its assets upon the maintenance of one
or more specified ratios that limit such Person's ability to encumber its assets
but  that do not  generally  prohibit  the  encumbrance  of its  assets,  or the
encumbrance  of specific  assets,  shall not  constitute  a Negative  Pledge for
purposes of this Agreement.

                                      -14-
<PAGE>

         "Net  Operating  Income"  means,  with  respect to a Property and for a
given  period,  the  sum of  the  following  (without  duplication):  (a)  rents
(adjusted  for  straight-lining  of rents) and other  revenues  received  in the
ordinary  course  from the  leasing or  operating  of such  Property  (including
proceeds of rent loss  insurance but excluding  pre-paid  rents and revenues and
security  deposits  except to the extent  applied in  satisfaction  of  tenants'
obligations  for rent) minus (b) all expenses paid or accrued by the Borrower or
a  Subsidiary  related  to the  ownership,  operation  or  maintenance  of  such
Property,  including  but not limited to taxes,  assessments  and other  similar
charges,   insurance,   utilities,   payroll  costs,  maintenance,   repair  and
landscaping  expenses,  on-site marketing expenses and property  management fees
equal to the  greater  of (i)  actual  property  management  fees or (ii)  three
percent  (3.0%) of the total gross  revenues for such  Property for such period,
but in any event excluding general and  administrative  expenses of the Borrower
and its Subsidiaries,  minus (c) Capital  Expenditures  Reserves with respect to
such Property for such period.

         "Net Proceeds"  means with respect to any Equity  Issuance by a Person,
the aggregate amount of all cash and the Fair Market Value of all other property
received  by such Person in respect of such Equity  Issuance  net of  investment
banking  fees,  legal  fees,   accountants'  fees,  underwriting  discounts  and
commissions  and other  customary  fees and expenses  actually  incurred by such
Person in connection with such Equity Issuance.

         "Net Worth"  means,  with respect to any Person,  such  Person's  total
shareholder's  equity (including  capital stock,  additional paid-in capital and
retained earnings, after deducting treasury stock) which would appear as such on
a balance sheet of such Person prepared in accordance with GAAP.

         "Nonrecourse   Indebtedness"   means,   with   respect   to  a  Person,
Indebtedness for borrowed money in respect of which recourse for payment (except
for  customary  exceptions  for fraud,  misapplication  of funds,  environmental
indemnities,   and  other   similar   exceptions   to  recourse   liability)  is
contractually  limited to specific  assets of such Person  encumbered  by a Lien
securing such Indebtedness.

         "Note" means a Revolving Note, a Bid Rate Note or a Swingline Note.

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

         "Notice of Continuation"  means a notice in the form of Exhibit D to be
delivered  to the Agent  pursuant  to Section  2.9.  evidencing  the  Borrower's
request for the Continuation of a LIBOR Loan.

         "Notice  of  Conversion"  means a notice in the form of Exhibit E to be
delivered  to the Agent  pursuant to Section  2.10.  evidencing  the  Borrower's
request for the Conversion of a Loan from one Type to another Type.

                                      -15-
<PAGE>

         "Notice of Swingline Borrowing" means a notice in the form of Exhibit F
to be delivered to the Agent pursuant to Section 2.3.  evidencing the Borrower's
request for a borrowing of Swingline Loans.

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

         "Participant" has the meaning given that term in Section 12.5.(c).

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

         "Permitted  Liens" means,  as to any Person:  (a) Liens securing taxes,
assessments  and other charges or levies imposed by any  Governmental  Authority
(excluding  any Lien imposed  pursuant to any of the provisions of ERISA) or the
claims of materialmen, mechanics, carriers, warehousemen or landlords for labor,
materials,  supplies or rentals  incurred in the  ordinary  course of  business,
which are not at the time required to be paid or discharged  under Section 7.6.;
(b) Liens  consisting  of deposits or pledges  made,  in the ordinary  course of
business,  in  connection  with,  or to secure  payment  of,  obligations  under
workers'  compensation,  unemployment  insurance or similar Applicable Laws; (c)
Liens  consisting  of  encumbrances  in  the  nature  of  zoning   restrictions,
easements,  and rights or  restrictions  of record on the use of real  property,
which do not  materially  detract from the value of such  property or impair the
use thereof in the business of such Person; and (d) Liens in existence as of the
Agreement Date and set forth in Part II of Schedule 6.1.(f).

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

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

         "Post-Default  Rate" means,  in respect of any principal of any Loan or
any other Obligation that is not paid when due (whether at stated  maturity,  by
acceleration,  by optional or mandatory  prepayment  or  otherwise),  a rate per
annum equal to four percent  (4.0%) plus the Base Rate as in effect from time to
time.

                                      -16-
<PAGE>

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

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

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

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

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

         "Property  EBITDA"  means,  with  respect to a Property and for a given
period, the sum of the following (without duplication):  (a) rents (adjusted for
straight-lining  of rents) and other  revenues  received in the ordinary  course
from the leasing or operating of such Property  (including proceeds of rent loss
insurance but excluding pre-paid rents and revenues and security deposits except
to the extent applied in  satisfaction  of tenants'  obligations for rent) minus
(b) all expenses paid or accrued by the Borrower or a Subsidiary  related to the
ownership,  operation or maintenance of such Property, including but not limited
to taxes, assessments and other similar charges, insurance,  utilities,  payroll
costs, maintenance,  repair and landscaping expenses, on-site marketing expenses
and  property  management  fees  equal to the  greater  of (i)  actual  property
management  fees or (ii) three  percent  (3.0%) of the total gross  revenues for
such  Property  for  such  period,  but  in  any  event  excluding  general  and
administrative expenses of the Borrower and its Subsidiaries.

         "Rating  Agency"  means S&P and  Moody's.  If either  such  corporation
ceases to act as a securities  rating  agency or ceases to provide  ratings with
respect to the senior long-term unsecured debt obligations of the Borrower, then
the Borrower may  designate as a  replacement  Rating  Agency Fitch or any other
nationally recognized securities rating agency acceptable to the Agent.

         "Register" has the meaning given that term in Section 12.5.(f).

                                      -17-
<PAGE>

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

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

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

         "RMR"  means  REIT  Management  &  Research,  Inc.,  together  with its
successors and permitted assigns.

         "Requisite  Lenders" means, as of any date,  Lenders having at least 66
2/3% of the aggregate amount of the Commitments (not held by Defaulting  Lenders
who are not entitled to vote),  or, if the  Commitments  have been terminated or
reduced to zero, Lenders holding at least 66 2/3% of the principal amount of the
Loans and Letter of Credit  Liabilities (not held by Defaulting  Lenders who are
not entitled to vote).

         "Responsible  Officer"  means (a) with  respect  to the  Borrower,  the
Borrower's  President or  Treasurer or any Managing  Trustee of the Borrower and
(b) with  respect to any other Loan Party,  such Loan  Party's  chief  executive
officer or chief financial officer.

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

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

         "Revolving Note" has the meaning given that term in Section 2.11.(a).

         "Secured  Indebtedness" means, with respect to a Person as of any given
date,  the  aggregate  principal  amount  of all  Indebtedness  of  such  Person
outstanding  at such date and that

                                      -18-
<PAGE>

is  secured in any manner by any Lien,  and in the case of the  Borrower,  shall
include  (without  duplication)  the  Borrower's  pro rata share of the  Secured
Indebtedness of its Unconsolidated Affiliates.

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

         "SNH"  means  Senior  Housing  Properties  Trust,   together  with  its
successors and assigns.

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

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

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

         "Subordinated  Debt" means  Indebtedness  of the Borrower or any of its
Subsidiaries that is subordinated in right of payment and otherwise to the Loans
and the other  Obligations  on terms and  conditions  approved  of by the Titled
Agents and the  Requisite  Lenders.  When the  Borrower  is seeking  approval of
subordination  terms  and  conditions  pursuant  to  the  immediately  preceding
sentence,  it shall deliver to the Agent a reasonably  detailed  description  of
such terms and conditions which must contain a conspicuous  legend to the effect
that a Lender will be deemed to have  approved such terms if it does not respond
in writing to the contrary within the prescribed time.  Promptly upon receipt of
any such  notice,  the Agent will  forward it to each of the  Lenders.  Unless a
Lender shall give written  notice to the Agent that it  specifically  objects to
such terms and conditions within 10 Business Days of receipt of such description
from the Agent,  such Lender shall be deemed to have  approved of such terms and
conditions.

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

                                      -19-
<PAGE>

         "Supermajority  Lenders" means, as of any date, Lenders having at least
75% of the aggregate amount of the Commitments  (not held by Defaulting  Lenders
who are not entitled to vote),  or, if the  Commitments  have been terminated or
reduced to zero,  Lenders  holding at least 75% of the  principal  amount of the
Loans and Letter of Credit  Liabilities (not held by Defaulting  Lenders who are
not entitled to vote).

         "Swingline  Commitment" means the Swingline Lender's obligation to make
Swingline  Loans pursuant to Section 2.3. in an amount up to, but not exceeding,
$25,000,000,  as such amount may be reduced from time to time in accordance with
the terms hereof.

         "Swingline  Lender" means First Union National Bank,  together with its
respective successors and assigns.

         "Swingline  Loan"  means a loan  made by the  Swingline  Lender  to the
Borrower pursuant to Section 2.3.(a).

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

         "Tangible  Net Worth" means,  as of any given time:  (a) the book value
(exclusive  of  depreciation)  of all real estate assets of the Borrower and its
Subsidiaries that constitute Properties at such time; plus (b) the book value of
other  assets  (excluding  any  real  estate  assets)  of the  Borrower  and its
Subsidiaries;  less (c) the book value of the  Borrower's  Investment in HPT and
SNH; less (d) all amounts appearing on the assets side of a consolidated balance
sheet of the Borrower for assets  separately  classified  as  intangible  assets
under GAAP;  less (e) all  Indebtedness  of the  Borrower  and its  Subsidiaries
determined  on a  consolidated  basis;  less (f) all  other  liabilities  of the
Borrower and its Subsidiaries determined on a consolidated basis.

         "Taxes" has the meaning given that term in Section 3.12.

         "Termination  Date" means April 30, 2005, or such earlier date to which
the Termination Date may be shortened pursuant to Section 2.13.

         "Titled  Agents" means the Lead  Arranger,  the Co-Lead  Arranger,  the
Syndication Agent and the Documentation  Agents, and their respective successors
and permitted assigns.

         "Total  Asset  Value"   means  the  sum  of  the   following   (without
duplication)  of the Borrower and its  Subsidiaries  for the fiscal quarter most
recently ended: (a)(i)(x) Property EBITDA determined on a consolidated basis for
such fiscal quarter and which is  attributable to the Properties of the Borrower
and its  Subsidiaries  (excluding  Property  EBITDA  attributable  to Properties
either  acquired or disposed  of during such fiscal  quarter)  minus (y) Capital
Expenditure  Reserves for such  Properties  for such fiscal quarter times (ii) 4
and  divided  by (iii)  9.25%;  (b) the  purchase  price  paid for any  Property
acquired  during such fiscal  quarter (less any amounts paid as a purchase price
adjustment,  held in escrow, retained as a contingency reserve, or other similar
arrangements);  (c) the value of the Borrower's equity Investment in each of HPT

                                      -20-
<PAGE>

and SNH, such value  determined at the lower cost or Fair Market Value;  (d) all
cash, cash equivalents and accounts  receivable that are not (i) owing in excess
of 90 days (or one year in the case of any Governmental  Authority of the United
States of America  (but not  political  subdivisions  thereof)) as of the end of
such fiscal period or (ii) being  contested in writing by the obligor in respect
thereof (in which case only such portion being  contested shall be excluded from
Total Asset Value);  (e) prepaid  taxes and operating  expenses as of the end of
such fiscal  period;  (f) the book value of all  Developable  Land; (g) the book
value of all other tangible assets (excluding land or other real property) as of
the end of such fiscal period;  (h) the book value of all Unencumbered  Mortgage
Notes;  and (i) the Borrower's pro rata share of the preceding items (other than
those  referred  to in  clause  (c))  of  any  Unconsolidated  Affiliate  of the
Borrower.

         "Total  Indebtedness" means, as of a given date, all liabilities of the
Borrower and its Subsidiaries  which would, in conformity with GAAP, be properly
classified  as a liability on a  consolidated  balance sheet of the Borrower and
its  Subsidiaries  as of such  date,  and in any event  shall  include  (without
duplication):  (a) all Indebtedness of the Borrower and its Subsidiaries and (b)
the Borrower's pro rata share of Indebtedness of its Unconsolidated Affiliates.

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

         "Unconsolidated Affiliate" means, with respect to any Person, any other
Person in whom such Person holds an  Investment,  which  Investment is accounted
for in the financial  statements of such Person on an equity basis of accounting
and whose  financial  results  would  not be  consolidated  under  GAAP with the
financial  results of such Person on the  consolidated  financial  statements of
such Person. For purposes of this definition, Unconsolidated Affiliate shall not
include SNH and HPT.

         "Unencumbered  Asset"  means  a  Property  which  satisfies  all of the
following  requirements:  (a) such Property is (i) owned in fee simple solely by
the Borrower or a Guarantor or (ii) leased solely by the Borrower or a Guarantor
pursuant to a ground lease having terms and conditions  reasonably acceptable to
the Agent;  (b) is not an Asset  Under  Development  and is in  service;  (c) is
improved only with office  buildings or other  improvements of a type similar to
improvements  located on the  Properties as of the Agreement  Date;  (d) neither
such Property,  nor any interest of the Borrower or such Guarantor  therein,  is
subject  to any Lien  (other  than  Permitted  Liens of the types  described  in
clauses  (a)  through  (c) of the  definition  thereof  or Liens in favor of the
Borrower or a Guarantor)  or to any  Negative  Pledge;  (e) if such  Property is
owned by a Subsidiary,  (i) none of the Borrower's direct or indirect  ownership
interest in such  Subsidiary is subject to any Lien (other than Permitted  Liens
of the types  described in clauses (a) through (c) of the definition  thereof or
Liens in favor of the  Borrower or a Guarantor)  or to any  Negative  Pledge and
(ii) the Borrower directly, or indirectly through a Subsidiary, has the right to
sell,  transfer or otherwise dispose of such Property without the need to obtain
the  consent of any  Person;  and (f) such  Property  is free of all  structural
defects  or  major  architectural  deficiencies,  title  defects,  environmental
conditions  or  other  adverse  matters  which,  individually  or  collectively,
materially impair the value of such Property.

                                      -21-
<PAGE>

         "Unencumbered Asset Value" means, at any given time, the sum of: (a)(i)
Net Operating  Income from all  Unencumbered  Assets for the fiscal quarter most
recently  ending times (ii) 4 divided by (iii) 9.25%;  and (b) the book value of
all  Unencumbered  Mortgage Notes of the Borrower and its  Subsidiaries.  To the
extent that the book value of Unencumbered Mortgage Notes would account for more
than 10.0% of Unencumbered  Asset Value,  such excess shall be excluded.  To the
extent that  Properties  leased by the  Borrower  or a  Guarantor  pursuant to a
ground lease would, in the aggregate, account for more than 5.0% of Unencumbered
Asset Value, such excess shall be excluded.  Pro forma Net Operating Income from
any Unencumbered  Asset acquired during such fiscal quarter shall be entitled to
include such Property for the entire quarter in the foregoing calculation. If an
Unencumbered  Asset is not  owned as of the last day of a  quarter  then the Net
Operating   Income  from  such  asset  shall  be  excluded  from  the  foregoing
calculation.

         "Unencumbered  Mortgage Note" means a promissory note satisfying all of
the  following  requirements:  (a) such  promissory  note is owned solely by the
Borrower or a Guarantor;  (b) such  promissory note is secured by a Lien on real
property  improved only with office  buildings or other  improvements  of a type
similar to improvements  located on the Properties as of the Agreement Date; (c)
neither such promissory note, nor any interest of the Borrower or such Guarantor
therein,  is  subject  to any Lien  (other  than  Permitted  Liens of the  types
described in clauses (a) through (c) of the definition thereof or Liens in favor
of  the  Borrower  or a  Guarantor)  or to any  Negative  Pledge;  (d)  if  such
promissory note is owned by a Subsidiary,  (i) none of the Borrower's  direct or
indirect  ownership  interest in such  Subsidiary  is subject to any Lien (other
than  Permitted  Liens of the types  described in clauses (a) through (c) of the
definition  thereof or Liens in favor of the Borrower or a Guarantor)  or to any
Negative  Pledge  and  (ii) the  Borrower  directly,  or  indirectly  through  a
Subsidiary,  has the  right to  sell,  transfer  or  otherwise  dispose  of such
promissory  note  without the need to obtain the consent of any Person;  and (d)
such real  property and related  improvements  are not subject to any other Lien
(other than Permitted Liens of the types described in clauses (a) through (c) of
the definition thereof or Liens in favor of the Borrower or a Guarantor).

         "Unencumbered  Net Operating Income" means the sum of (a) Net Operating
Income from all Unencumbered  Assets for the fiscal quarter most recently ending
and (b) income  attributable  to  Unencumbered  Mortgage  Notes for such  fiscal
quarter,  other than income attributable to an Unencumbered  Mortgage Note where
(i) any  required  principal  or interest  payment  due under such  Unencumbered
Mortgage  Note  is more  than  60  days  past  due or  (ii)  the  maker  of such
Unencumbered  Mortgage Note is the subject of a case, proceeding or condition of
any of the types described in Sections 10.1.(f) or 10.1.(g).  To the extent that
income  attributable to Unencumbered  Mortgage Notes would account for more than
10.0% of Unencumbered Net Operating  Income,  such excess shall be excluded.  In
addition,  notwithstanding  the  foregoing,  Unencumbered  Net Operating  Income
otherwise  attributable  to any  Investment in SNH or HPT shall be excluded from
Unencumbered Net Operating Income.

         "Unfunded Liabilities" means, with respect to any Plan at any time, the
amount  (if any) by which (a) the value of all  benefit  liabilities  under such
Plan, determined on a plan termination basis using the assumptions prescribed by
the PBGC for  purposes  of Section  4044 of ERISA,  exceeds  (b) the fair market
value of all Plan assets allocable to such  liabilities  under Title IV of

                                      -22-
<PAGE>

ERISA (excluding any accrued but unpaid contributions), all determined as of the
then most recent  valuation date for such Plan, but only to the extent that such
excess  represents  a potential  liability of a member of the ERISA Group to the
PBGC or any other Person under Title IV of ERISA.

         "Unsecured  Debt Service" means,  for a given period,  Debt Service for
such  period,  with respect to  Unsecured  Indebtedness  of the Borrower and its
Subsidiaries.

         "Unsecured  Indebtedness"  means,  with  respect  to a Person as of any
given date, the aggregate  principal  amount of all  Indebtedness of such Person
outstanding   at  such  date  that  is  not  Secured   Indebtedness   (excluding
Indebtedness  associated with Unconsolidated  Affiliates) and in the case of the
Borrower  shall  include  (without  duplication)   Indebtedness  that  does  not
constitute Secured Indebtedness.

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

Section 1.2.  General; References to Times.

         Unless  otherwise   indicated,   all  accounting   terms,   ratios  and
measurements  shall be  interpreted  or determined  in  accordance  with GAAP in
effect as of the Agreement  Date.  References in this  Agreement to  "Sections",
"Articles",  "Exhibits" and "Schedules" are to sections,  articles, exhibits and
schedules  herein and hereto  unless  otherwise  indicated.  references  in this
Agreement  to any  document,  instrument  or  agreement  (a) shall  include  all
exhibits,  schedules  and  other  attachments  thereto,  (b) shall  include  all
documents,  instruments or agreements issued or executed in replacement thereof,
to the extent permitted  hereby and (c) shall mean such document,  instrument or
agreement,  or  replacement or predecessor  thereto,  as amended,  supplemented,
restated or otherwise modified as of the date of this Agreement and from time to
time  thereafter to the extent not prohibited  hereby and in effect at any given
time.  Wherever  from the  context it appears  appropriate,  each term stated in
either the  singular or plural  shall  include  the  singular  and  plural,  and
pronouns  stated in the  masculine,  feminine or neuter gender shall include the
masculine,  the  feminine  and the neuter.  Unless  explicitly  set forth to the
contrary,  a reference to  "Subsidiary"  means a Subsidiary of the Borrower or a
Subsidiary  of  such  Subsidiary  and a  reference  to an  "Affiliate"  means  a
reference  to an  Affiliate  of the  Borrower.  Titles and captions of Articles,
Sections,  subsections and clauses in this Agreement are for  convenience  only,
and neither limit nor amplify the provisions of this Agreement. Unless otherwise
indicated,  all references to time are  references to Charlotte,  North Carolina
time.

                           ARTICLE II. CREDIT FACILITY

Section 2.1.  Revolving Loans.

         (a) Generally.  Subject to the terms and conditions hereof,  during the
period from the  Effective  Date to but  excluding the  Termination  Date,  each
Lender  severally and not jointly

                                      -23-
<PAGE>

agrees to make Revolving Loans to the Borrower in an aggregate  principal amount
at any one  time  outstanding  up to,  but not  exceeding,  the  amount  of such
Lender's  Commitment.  Subject to the terms and  conditions  of this  Agreement,
during the period from the Effective Date to but excluding the Termination Date,
the Borrower may borrow, repay and reborrow Revolving Loans hereunder.

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

         (c)  Disbursements of Revolving Loan Proceeds.  No later than 1:00 p.m.
on the date  specified  in the  Notice  of  Borrowing,  each  Lender  will  make
available for the account of its  applicable  Lending Office to the Agent at the
Principal Office, in immediately  available funds, the proceeds of the Revolving
Loan to be made by such Lender. With respect to Revolving Loans to be made after
the  Effective  Date,  unless the Agent  shall have been  notified by any Lender
prior to the  specified  date of  borrowing  that such Lender does not intend to
make available to the Agent the Revolving Loan to be made by such Lender on such
date,  the Agent may assume  that such  Lender  will make the  proceeds  of such
Revolving Loan available to the Agent on the date of the requested  borrowing as
set  forth in the  Notice  of  Borrowing  and the  Agent  may (but  shall not be
obligated to), in reliance upon such assumption,  make available to the Borrower
the amount of such  Revolving  Loan to be  provided by such  Lender.  Subject to
satisfaction  of the  applicable  conditions  set forth in  Article  V. for such
borrowing,  the Agent will make the proceeds of such borrowing  available to the
Borrower no later than 2:00 p.m. on the date and at the account specified by the
Borrower in such Notice of Borrowing.

Section 2.2.  Bid Rate Loans.

         (a) Bid Rate Loans.  So long as the Borrower  maintains  an  Investment
Grade Rating,  in addition to borrowings of Revolving  Loans, at any time during
the period from the Effective  Date to but excluding  the  Termination  Date the
Borrower may, as set forth in this  Section,  request the Lenders to make offers
to make Bid Rate Loans to the  Borrower in Dollars.  The Lenders  may, but shall
have no obligation  to, make such offers and the Borrower may, but shall have no
obligation to, accept any such offers in the manner set forth in this Section.

         (b)  Requests for Bid Rate Loans.  When the Borrower  wishes to request
from the Lenders  offers to make Bid Rate Loans,  it shall give the Agent notice
(a "Bid Rate Quote  Request")  so as to be  received no later than 10:00 a.m. on
the Business Day next  preceding  the date of borrowing  proposed  therein.  The
Agent  shall  deliver  to each  Lender  a copy of each Bid

                                      -24-
<PAGE>

Rate Quote Request  promptly upon receipt thereof by the Agent. The Borrower may
request  offers to make Bid Rate  Loans for up to three (3)  different  Interest
Periods in each Bid Rate  Quote  Request;  provided  that the  request  for each
separate Interest Period shall be deemed to be a separate Bid Rate Quote Request
for a separate  borrowing (a "Bid Rate Borrowing").  Each Bid Rate Quote Request
shall be substantially in the form of Exhibit H and shall specify as to each Bid
Rate Borrowing:

                  (i) the proposed date of such Bid Rate Borrowing,  which shall
         be a Business Day;

                  (ii) the aggregate  amount of such Bid Rate  Borrowing,  which
         (x)  shall  be in  the  minimum  amount  of  $10,000,000  and  integral
         multiples  of  $500,000  and (y)  shall  not  cause  any of the  limits
         specified in Section 2.15. to be violated; and

                  (iii) the duration of the Interest Period applicable thereto.

Except as otherwise  provided in this  subsection (b), no Bid Rate Quote Request
shall be given  within five  Business  Days (or such other number of days as the
Borrower and the Agent, with the consent of the Requisite Lenders, may agree) of
the giving of any other Bid Rate Quote Request.

         (c) Bid Rate Quotes.

                  (i) Each Lender may submit one or more Bid Rate  Quotes,  each
         containing an offer to make a Bid Rate Loan in response to any Bid Rate
         Quote Request;  provided that, if the Borrower's  request under Section
         2.2.(b) specified more than one Interest Period, such Lender may make a
         single submission  containing one or more Bid Rate Quotes for each such
         Interest Period. Each Bid Rate Quote must be submitted to the Agent not
         later than 11:00 a.m. on the proposed date of borrowing;  provided that
         the Lender  then acting as Agent may submit a Bid Rate Quote only if it
         notifies the Borrower of the terms of the offer  contained  therein not
         later than 10:45 a.m. on the proposed date of such  borrowing.  Subject
         to Articles V. and X., any Bid Rate Quote so made shall be  irrevocable
         except  with the  consent  of the  Agent  given at the  request  of the
         Borrower.  Any Bid Rate  Loan may be funded  by a  Lender's  Designated
         Lender (if any) as provided in Section  12.5.(e),  however  such Lender
         shall not be required to specify in its Bid Rate Quote whether such Bid
         Rate Loan will be funded by such Designated Lender.

                  (ii) Each Bid Rate Quote shall be substantially in the form of
         Exhibit I and shall specify:

                           (A) the proposed  date of borrowing  and the Interest
                  Period therefor;

                           (B) the  principal  amount  of the Bid Rate  Loan for
                  which  each  such  offer  is  being  made;  provided  that the
                  aggregate  principal  amount of all Bid Rate Loans for which a
                  Lender submits Bid Rate Quotes (x) may be greater or less than
                  the  Commitment  of such  Lender  but (y) shall not exceed the
                  principal  amount of

                                      -25-
<PAGE>

                  the Bid Rate  Borrowing for a particular  Interest  Period for
                  which offers were requested;

                           (C) the rate of interest per annum (rounded  upwards,
                  if  necessary,  to the nearest  1/10,000th  of 1%) offered for
                  each such Bid Rate Loan (the "Bid Rate"); and

                           (D) the identity of the quoting Lender.

         Unless  otherwise  agreed by the Agent  and the  Borrower,  no Bid Rate
         Quote shall  contain  qualifying,  conditional  or similar  language or
         propose  terms  other  than or in  addition  to those  set forth in the
         applicable Bid Rate Quote Request and, in particular, no Bid Rate Quote
         may be  conditioned  upon  acceptance  by the  Borrower of all (or some
         specified  minimum)  of the  principal  amount of the Bid Rate Loan for
         which such Bid Rate Quote is being made.

         (d)  Notification by Agent. The Agent shall, as promptly as practicable
after the Bid Rate Quotes are  submitted  (but in any event not later than 11:30
a.m. on the proposed date of borrowing), notify the Borrower of the terms (i) of
any Bid Rate Quote  submitted  by a Lender that is in  accordance  with  Section
2.2.(c) and (ii) of any Bid Rate Quote that  amends,  modifies  or is  otherwise
inconsistent  with a  previous  Bid Rate Quote  submitted  by such  Lender  with
respect to the same Bid Rate Quote Request.  Any such  subsequent Bid Rate Quote
shall be  disregarded  by the Agent  unless  such  subsequent  Bid Rate Quote is
submitted  solely to correct a manifest error in such former Bid Rate Quote. The
Agent's notice to the Borrower shall specify (A) the aggregate  principal amount
of the Bid Rate  Borrowing  for  which  offers  have been  received  and (B) the
principal  amounts  and Bid Rates so offered  by each  Lender  (identifying  the
Lender that made each Bid Rate Quote).

         (e) Acceptance by Borrower.

                  (i)  Not  later  than  12:00  noon  on the  proposed  date  of
         borrowing,  the Borrower  shall notify the Agent of its  acceptance  or
         nonacceptance  of the  offers so  notified  to it  pursuant  to Section
         2.2.(d)  which notice shall be in the form of Exhibit J. In the case of
         acceptance, such notice shall specify the aggregate principal amount of
         offers for each Interest  Period that are accepted.  The failure of the
         Borrower   to  give  such   notice  by  such  time   shall   constitute
         nonacceptance.  The Agent shall promptly  notify each affected  Lender.
         The  Borrower  may  accept  any Bid  Rate  Quote  in  whole or in part;
         provided that:

                           (A) the aggregate  principal  amount of each Bid Rate
                  Borrowing  may not exceed the  applicable  amount set forth in
                  the related Bid Rate Quote Request;

                           (B) the aggregate  principal  amount of each Bid Rate
                  Borrowing shall comply with the provisions of Section 3.5. but
                  shall not cause the limits  specified in Section  2.15.  to be
                  violated;

                                      -26-
<PAGE>

                           (C)   acceptance  of  offers  may  be  made  only  in
                  ascending  order of Bid Rates in each case  beginning with the
                  lowest rate so offered;

                           (D) the  Borrower  may not  accept any Bid Rate Quote
                  that fails to comply with Section  2.2.(c) or otherwise  fails
                  to comply with the requirements of this Agreement); and

                           (E) any  acceptance  in part  shall  be in a  minimum
                  amount of  $1,000,000  and  integral  multiples of $500,000 in
                  excess thereof.

                  (ii) If offers are made by two or more  Lenders  with the same
         Bid Rates for a greater  aggregate  principal amount than the amount in
         respect of which  offers are  permitted  to be accepted for the related
         Interest  Period,  the principal amount of Bid Rate Loans in respect of
         which such offers are  accepted  shall be  allocated by the Agent among
         such Lenders in proportion to the  aggregate  principal  amount of such
         offers.  Determinations  by the Agent of the  amounts of Bid Rate Loans
         shall be conclusive in the absence of manifest error.

         (f) Obligation to Make Bid Rate Loans.  The Agent shall promptly notify
each  Lender  whose Bid Rate  Quote has been  accepted  and the  amount and rate
thereof.  A Lender who is notified  that it has been selected to make a Bid Rate
Loan may designate its Designated  Lender (if any) to fund such Bid Rate Loan on
its behalf, as described in Section 12.5.(e).  Any Designated Lender which funds
a Bid Rate Loan shall on and after the time of such  funding  become the obligee
under such Bid Rate Loan and be entitled to receive payment thereof when due. No
Lender  shall be  relieved  of its  obligation  to fund a Bid Rate Loan,  and no
Designated Lender shall assume such obligation, prior to the time the applicable
Bid Rate Loan is funded.  Any Lender  whose  offer to make any Bid Rate Loan has
been  accepted  shall,  not later than 1:30 p.m. on the date  specified  for the
making of such Loan,  make the amount of such Loan available to the Agent at its
Principal  Office  in  immediately  available  funds,  for  the  account  of the
Borrower.  The amount so received by the Agent  shall,  subject to the terms and
conditions of this  Agreement,  be made  available to the Borrower no later than
2:00 p.m. on such date by depositing the same, in immediately  available  funds,
in an account of the Borrower designated by the Borrower.

         (g) No Effect on  Commitment.  Except for the purpose and to the extent
expressly  stated in Section 2.12.,  the amount of any Bid Rate Loan made by any
Lender shall not constitute a utilization of such Lender's Commitment.

Section 2.3.  Swingline Loans.

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

                                      -27-
<PAGE>

conditions  of this  Agreement,  the  Borrower  may borrow,  repay and  reborrow
Swingline Loans hereunder.

         (b) Procedure for Borrowing  Swingline  Loans.  The Borrower shall give
the Agent and the  Swingline  Lender  notice  pursuant to a Notice of  Swingline
Borrowing  or  telephonic  notice of each  borrowing of a Swingline  Loan.  Each
Notice of Swingline  Borrowing  shall be delivered  to the  Swingline  Lender no
later than 3:00 p.m. on the proposed date of such borrowing. Any such telephonic
notice shall  include all  information  to be  specified in a written  Notice of
Swingline  Borrowing and shall be promptly  confirmed in writing by the Borrower
pursuant to a Notice of  Swingline  Borrowing  sent to the  Swingline  Lender by
telecopy on the same day of the giving of such telephonic notice. On the date of
the  requested  Swingline  Loan and subject to  satisfaction  of the  applicable
conditions set forth in Article V. for such borrowing, the Swingline Lender will
make the proceeds of such  Swingline  Loan available to the Borrower in Dollars,
in immediately  available funds, at the account specified by the Borrower in the
Notice of  Swingline  Borrowing  not later than  11:00 a.m.  on such date if the
Swingline  Lender  received  such Notice of Swingline  Borrowing by 9:00 a.m. on
such date, and otherwise not later than 4:00 p.m. on such date.

         (c) Interest.  Swingline  Loans shall bear interest at a per annum rate
equal to the Base Rate plus the  Applicable  Margin  for Base Rate  Loans (or at
such other rate or rates as the Borrower and the Swingline Lender may agree from
time to time in writing).  Interest payable on Swingline Loans is solely for the
account of the Swingline  Lender.  All accrued and unpaid  interest on Swingline
Loans shall be payable on the dates and in the manner  provided in Section  2.5.
with respect to interest on Base Rate Loans (except as the Swingline  Lender and
the Borrower may otherwise  agree in writing in connection  with any  particular
Swingline Loan).

         (d) Swingline  Loan Amounts,  Etc. Each  Swingline Loan shall be in the
minimum  amount of $1,000,000  and integral  multiples of $500,000 or such other
minimum  amounts  agreed  to by the  Swingline  Lender  and  the  Borrower.  Any
voluntary  prepayment  of a  Swingline  Loan must be in  integral  multiples  of
$100,000 or the aggregate  principal  amount of all outstanding  Swingline Loans
(or such other minimum amounts upon which the Swingline  Lender and the Borrower
may agree) and in connection  with any such  prepayment,  the Borrower must give
the Swingline  Lender prior written  notice  thereof no later than 10:00 a.m. on
the date of such  prepayment.  The  Swingline  Loans shall,  in addition to this
Agreement, be evidenced by the Swingline Note.

         (e)  Repayment  and  Participations  of Swingline  Loans.  The Borrower
agrees to repay each Swingline  Loan within one Business Day of demand  therefor
by the Swingline Lender and in any event,  within 5 Business Days after the date
such Swingline Loan was made.  Notwithstanding the foregoing, the Borrower shall
repay the entire  outstanding  principal  amount of, and all  accrued but unpaid
interest on, the Swingline Loans on the  Termination  Date (or such earlier date
as the  Swingline  Lender and the  Borrower  may agree in  writing).  In lieu of
demanding  repayment  of any  outstanding  Swingline  Loan from the  Borrower in
respect  of which the Agent has not either  (x)  received a Notice of  Borrowing
indicating that such Swingline Loan is to be repaid with the proceeds thereof or
(y) received  notice from the Borrower  that it intends to repay such  Swingline
Loan on a  specified  date  and,  in the  case of this  clause  (y)  only,  such

                                      -28-
<PAGE>

Swingline  Loan is not repaid by 11:30 a.m. on such date,  the Swingline  Lender
may, on behalf of the Borrower (which hereby  irrevocably  directs the Swingline
Lender to act on its  behalf),  request a borrowing  of  Revolving  Loans (which
shall be Base Rate Loans) from the Lenders in an amount  equal to the  principal
balance of such  Swingline  Loan. The  limitations of Section  3.5.(a) shall not
apply to any borrowing of Base Rate Loans made pursuant to this subsection.  The
Swingline  Lender  shall give notice to the Agent of any such  borrowing of Base
Rate Loans not later than 12:00 noon on the proposed date of such borrowing.  No
later than 2:00 p.m. on such date,  each Lender will make available to the Agent
at the  Principal  Office for the account of Swingline  Lender,  in  immediately
available  funds,  the proceeds of the Base Rate Loan to be made by such Lender.
The Agent  shall pay the  proceeds  of such  Base  Rate  Loans to the  Swingline
Lender,  which shall apply such  proceeds to repay such  Swingline  Loan. If the
Lenders  are  prohibited  from  making  Loans  required  to be made  under  this
subsection for any reason,  including without limitation,  the occurrence of any
of the Events of Default described in Sections 10.1.(f) or 10.1.(g), each Lender
shall  purchase  from the Swingline  Lender,  without  recourse or warranty,  an
undivided  interest and participation to the extent of such Lender's  Commitment
Percentage of such Swingline  Loan, by directly  purchasing a  participation  in
such  Swingline  Loan in such  amount  (regardless  of  whether  the  conditions
precedent  thereto set forth in Section 5.2. are then satisfied,  whether or not
the  Borrower  has  submitted  a Notice  of  Borrowing  and  whether  or not the
Commitments  are then in effect,  any Event of  Default  exists or all the Loans
have been  accelerated)  and  paying the  proceeds  thereof to the Agent for the
account of the Swingline  Lender in Dollars and in immediately  available funds.
If such  amount is not in fact made  available  to the  Swingline  Lender by any
Lender,  the Swingline Lender shall be entitled to recover such amount on demand
from such Lender,  together with accrued  interest thereon for each day from the
date of demand  thereof,  at the Federal Funds Rate. If such Lender does not pay
such amount  forthwith upon the Swingline  Lender's demand  therefor,  and until
such time as such Lender makes the required payment,  the Swingline Lender shall
be deemed to continue to have outstanding  Swingline Loans in the amount of such
unpaid  participation  obligation for all purposes of the Loan Documents  (other
than those  provisions  requiring the other Lenders to purchase a  participation
therein).  Further,  such Lender  shall be deemed to have  assigned  any and all
payments made of principal and interest on its Loans,  and any other amounts due
to it hereunder,  to the Swingline  Lender to fund Swingline Loans in the amount
of the  participation  in  Swingline  Loans that such Lender  failed to purchase
pursuant to this Section  until such amount has been  purchased  (as a result of
such  assignment  or  otherwise).  A  Lender's  obligation  to  purchase  such a
participation in a Swingline Loan shall be absolute and  unconditional and shall
not be affected by any circumstance  whatsoever,  including without  limitation,
(i) any claim of setoff, counterclaim,  recoupment, defense or other right which
such  Lender  or any other  Person  may have or claim  against  the  Agent,  the
Swingline  Lender  or any  other  Person  whatsoever,  (ii)  the  occurrence  or
continuation of a Default or Event of Default (including without limitation, any
of the Defaults or Events of Default described in Sections 10.1.(f) or 10.1.(g))
or the termination of any Lender's  Commitment,  (iii) the existence (or alleged
existence)  of an event or  condition  which  has had or could  have a  Material
Adverse Effect, (iv) any breach of any Loan Document by the Agent, any Lender or
the  Borrower  or (v) any other  circumstance,  happening  or event  whatsoever,
whether or not similar to any of the foregoing.

                                      -29-
<PAGE>

Section 2.4.  Letters of Credit.

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

         (b) Terms of Letters of Credit.  At the time of  issuance,  the amount,
form,  terms and  conditions  of each  Letter of  Credit,  and of any  drafts or
acceptances  thereunder,  shall be  subject  to  approval  by the  Agent and the
Borrower.  Notwithstanding the foregoing, in no event may the expiration date of
any Letter of Credit extend beyond the earlier of (i) the date one year from its
date of issuance or (ii) the Termination Date.

         (c) Requests for Issuance of Letters of Credit. The Borrower shall give
the Agent written notice (or telephonic notice promptly confirmed in writing) at
least 5 Business  Days prior to the  requested  date of  issuance of a Letter of
Credit,  such notice to describe in reasonable detail the proposed terms of such
Letter of Credit and the nature of the  transactions or obligations  proposed to
be  supported  by such  Letter of Credit,  and in any event shall set forth with
respect to such Letter of Credit (i) the proposed  initial Stated  Amount,  (ii)
the beneficiary or  beneficiaries,  and (iii) the proposed  expiration date. The
Borrower  shall  also  execute  and  deliver  such  customary  letter  of credit
application  forms as  requested  from time to time by the Agent.  Provided  the
Borrower  has  given  the  notice  prescribed  by the  first  sentence  of  this
subsection  and subject to Section 2.15.  and the other terms and  conditions of
this  Agreement,   including  the  satisfaction  of  any  applicable  conditions
precedent set forth in Article V., the Agent shall issue the requested Letter of
Credit on the  requested  date of  issuance  for the  benefit of the  stipulated
beneficiary.  Upon the written request of the Borrower,  the Agent shall deliver
to the Borrower a copy of each issued Letter of Credit within a reasonable  time
after the date of issuance thereof. To the extent any term of a Letter of Credit
Document is inconsistent with a term of any Loan Document, the term of such Loan
Document shall control.

         (d)  Reimbursement  Obligations.  Upon  receipt  by the Agent  from the
beneficiary of a Letter of Credit of any demand for payment under such Letter of
Credit, the Agent shall promptly notify the Borrower of the amount to be paid by
the Agent as a result of such demand and the date on which payment is to be made
by the Agent to such beneficiary in respect of such demand;  provided,  however,
the Agent's failure to give, or delay in giving, such notice shall not discharge
the Borrower in any respect from the applicable  Reimbursement  Obligation.  The
Borrower hereby  unconditionally and irrevocably agrees to pay and reimburse the
Agent for the amount of each demand for  payment  under such Letter of Credit on
or  prior  to the  date on  which  payment  is to be made  by the  Agent  to the
beneficiary   thereunder,   without  presentment,   demand,   protest  or  other
formalities of any kind (other than notice as provided in this subsection). Upon
receipt by the Agent of any payment in respect of any Reimbursement  Obligation,
the Agent shall  promptly pay to each Lender that has  acquired a  participation
therein under the second  sentence of Section  2.4.(i) such Lender's  Commitment
Percentage of such payment.

                                      -30-
<PAGE>

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

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

         (g) Agent's Duties Regarding Letters of Credit; Unconditional Nature of
Reimbursement  Obligation.  In examining  documents presented in connection with
drawings  under  Letters  of Credit and making  payments  under such  Letters of
Credit against such documents,  the Agent shall only be required to use the same
standard of care as it uses in connection with examining  documents presented in
connection  with  drawings  under  letters  of  credit  in which it has not sold
participations  and making  payments under such letters of credit.  The Borrower
assumes  all risks of the acts and  omissions  of, or misuse of the  Letters  of
Credit  by,  the  respective   beneficiaries  of  such  Letters  of  Credit.  In
furtherance and not in limitation of the foregoing, neither the Agent nor any of
the  Lenders  shall be  responsible  for (i) the  form,  validity,  sufficiency,
accuracy, genuineness or legal effects of any document submitted by any party in
connection with the application for and issuance of or any drawing honored under
any  Letter  of  Credit  even if it  should  in fact  prove  to be in any or all
respects  invalid,  insufficient,  inaccurate,  fraudulent  or forged;  (ii) the
validity  or  sufficiency  of  any  instrument   transferring  or  assigning  or
purporting to transfer or assign any Letter of Credit, or the rights or benefits
thereunder  or  proceeds  thereof,  in whole or in part,  which  may prove to be
invalid or ineffective  for any reason;  (iii) failure of the beneficiary of any
Letter of Credit to comply fully with conditions  required in order to draw upon
such  Letter of  Credit;  (iv)  errors,  omissions,  interruptions  or delays in
transmission or delivery of any messages,  by mail,  cable,  telex,  telecopy or
otherwise,  whether or not they be in cipher;  (v) errors in  interpretation  of
technical terms;  (vi) any loss or delay in the transmission or otherwise of any
document  required in order to make a drawing under any Letter of Credit,  or of
the proceeds thereof;  (vii) the misapplication by the beneficiary of any Letter
of Credit,  or the proceeds of any drawing under any Letter of Credit; or (viii)
any  consequences  arising  from  causes  beyond the control of the Agent or the
Lenders. None of the above shall affect, impair or prevent the vesting of any of
the Agent's rights or powers hereunder.  Any action taken or omitted to be taken
by the Agent  under or in

                                      -31-
<PAGE>

connection  with any  Letter of Credit,  if taken or  omitted in the  absence of
gross  negligence or willful  misconduct,  shall not create against the Agent or
any Lender any liability to the Borrower or any Lender. In this connection,  the
obligation of the Borrower to reimburse the Agent for any drawing made under any
Letter of Credit shall be absolute,  unconditional  and irrevocable and shall be
paid  strictly  in  accordance  with  the  terms  of this  Agreement  under  all
circumstances   whatsoever,   including   without   limitation,   the  following
circumstances:  (A) any lack of  validity  or  enforceability  of any  Letter of
Credit Document or any term or provisions  therein;  (B) any amendment or waiver
of or any  consent  to  departure  from  all or any  of  the  Letter  of  Credit
Documents;  (C) the existence of any claim, setoff, defense or other right which
the Borrower may have at any time against the Agent, any Lender, any beneficiary
of a Letter of  Credit or any other  Person,  whether  in  connection  with this
Agreement,  the  transactions  contemplated  hereby  or in the  Letter of Credit
Documents or any  unrelated  transaction;  (D) any breach of contract or dispute
between the Borrower, the Agent, any Lender or any other Person; (E) any demand,
statement or any other document presented under a Letter of Credit proving to be
forged,  fraudulent,  invalid or  insufficient  in any respect or any  statement
therein  or made in  connection  therewith  being  untrue or  inaccurate  in any
respect whatsoever; (F) any non-application or misapplication by the beneficiary
of a Letter  of Credit of the  proceeds  of any  drawing  under  such  Letter of
Credit; (G) payment by the Agent under any Letter of Credit against presentation
of a draft or certificate  which does not strictly comply with the terms of such
Letter of Credit;  and (H) any other act, omission to act, delay or circumstance
whatsoever  that might,  but for the  provisions of this  Section,  constitute a
legal or  equitable  defense to or  discharge  of the  Borrower's  Reimbursement
Obligations.  Notwithstanding anything to the contrary contained in this Section
or  Section  12.9.,  but  not  in  limitation  of the  Borrower's  unconditional
obligation  to reimburse the Agent for any drawing made under a Letter of Credit
as provided in this Section,  the Borrower shall have no obligation to indemnify
the Agent or any  Lender  in  respect  of any  liability  incurred  by the Agent
arising solely out of the gross negligence or willful misconduct of the Agent in
respect of a Letter of Credit as actually and finally  determined  by a court of
competent jurisdiction. Except as otherwise provided in this Section, nothing in
this  Section  shall affect any rights the Borrower may have with respect to the
Agent's  gross  negligence or willful  misconduct  with respect to any Letter of
Credit.

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

         (i) Lenders'  Participation in Letters of Credit.  Immediately upon the
issuance  by the Agent of any Letter of Credit  each  Lender  shall be deemed to
have  irrevocably  and  unconditionally  purchased  and received from the Agent,
without  recourse or warranty,  an undivided  interest and  participation to the
extent of such Lender's Commitment Percentage of the liability of the Agent with
respect  to such  Letter of Credit and each  Lender  thereby  shall

                                      -32-
<PAGE>

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

         (j) Payment Obligation of Lenders.  Each Lender severally agrees to pay
to the Agent on demand in immediately  available  funds in Dollars the amount of
such Lender's Commitment Percentage of each drawing paid by the Agent under each
Letter of Credit to the extent such  amount is not  reimbursed  by the  Borrower
pursuant to Section 2.4.(d). Each such Lender's obligation to make such payments
to the Agent under this  subsection,  and the Agent's right to receive the same,
shall be absolute,  irrevocable and  unconditional  and shall not be affected in
any way by any circumstance  whatsoever,  including without limitation,  (i) the
failure of any other Lender to make its payment under this subsection,  (ii) the
financial condition of the Borrower or any other Loan Party, (iii) the existence
of any Default or Event of Default,  including any Event of Default described in
Section  10.1.(f) or 10.1.(g) or (iv) the termination of the  Commitments.  Each
such  payment  to the  Agent  shall  be  made  without  any  offset,  abatement,
withholding or deduction whatsoever.

         (k) Information to Lenders. Upon the request of any Lender from time to
time, the Agent shall deliver to such Lender information reasonably requested by
such Lender with respect to each Letter of Credit then  outstanding.  Other than
as set forth in this  subsection,  the Agent  shall  have no duty to notify  the
Lenders  regarding  the issuance or other  matters  regarding  Letters of Credit
issued  hereunder.  The failure of the Agent to perform its  requirements  under
this subsection shall not relieve any Lender from its obligations  under Section
2.4.(j).

Section 2.5.  Rates and Payment of Interest on Loans.

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

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

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

                                      -33-
<PAGE>

                  (iii)  if such  Loan is a Bid Rate  Loan,  at the Bid Rate for
         such Loan for the Interest  Period therefor quoted by the Lender making
         such Loan in accordance with Section 2.2.

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

         (b) Payment of Interest. Accrued interest on each Loan shall be payable
(i) in the case of a Base Rate Loan, monthly in arrears on the first day of each
calendar month, (ii) in the case of a LIBOR Loan or a Bid Rate Loan, on the last
day of each Interest  Period  therefor,  and (iii) in the case of any Loan, upon
the payment,  prepayment or Continuation  thereof or the Conversion of such Loan
to a Loan of another Type (but only on the  principal  amount so paid,  prepaid,
Continued or  Converted).  Interest  payable at the  Post-Default  Rate shall be
payable from time to time on demand.  Promptly  after the  determination  of any
interest  rate provided for herein or any change  therein,  the Agent shall give
notice  thereof  to the  Lenders to which such  interest  is payable  and to the
Borrower. All determinations by the Agent of an interest rate hereunder shall be
conclusive and binding on the Lenders and the Borrower for all purposes,  absent
manifest error.

         (c) Ratings Change.  If the Applicable  Margin shall change as a result
of a change in the Borrower's  Credit Rating and then within a 90-period  change
back to the  Applicable  Margin in effect at the  beginning  of such period as a
result of another change in such Credit Rating, and (i) if the initial change in
the  Applicable  Margin were an increase,  then the  Borrower  will receive as a
credit against its Obligations any incremental  interest expense with respect to
the Loans and the Facility Fee for the period during which the increase  existed
and (ii) if the initial  change in the Applicable  Margin were a decrease,  then
the  Borrower  shall  promptly  pay to the Agent for the  benefit of the Lenders
additional  interest with respect to the Loans and additional  Facility Fees for
the period during which the increase existed  determined as if such decrease had
not occurred.

Section 2.6.  Number of Interest Periods.

         There may be no more than 6 different Interest Periods for either LIBOR
Loans or Bid Rate Loans, and no more than 9 different Interest Periods for LIBOR
Loans and Bid Rate Loans  collectively,  outstanding at the same time (for which
purpose  Interest  Periods  described  in  different  lettered  clauses  of  the
definition  of the term  "Interest  Period"  shall  be  deemed  to be  different
Interest Periods even if they are coterminous).

Section 2.7.  Repayment of Loans.

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

                                      -34-
<PAGE>

         (b) Bid Rate Loans.  The  Borrower  shall repay the entire  outstanding
principal  amount of, and all accrued but unpaid interest on, each Bid Rate Loan
on the last day of the Interest Period of such Bid Rate Loan.

Section 2.8.  Prepayments.

         (a) Optional. Subject to Section 4.4., the Borrower may prepay any Loan
(other than a Bid Rate Loan) at any time  without  premium or penalty.  Bid Rate
Loans may not be prepaid at the option of the Borrower.  The Borrower shall give
the Agent at least one Business  Day's prior written notice of the prepayment of
any Revolving Loan.

         (b)  Mandatory.  If at any time the aggregate  principal  amount of all
outstanding Revolving Loans, together with the aggregate amount of all Letter of
Credit  Liabilities  and the aggregate  principal  amount of all outstanding Bid
Rate  Loans and the  aggregate  principal  amount of all  outstanding  Swingline
Loans,  exceeds the aggregate  amount of the Commitments in effect at such time,
the Borrower shall  immediately pay to the Agent for the accounts of the Lenders
the amount of such excess.  Such payment  shall be applied to pay all amounts of
principal outstanding on the Loans and any Reimbursement Obligations pro rata in
accordance  with Section 3.2.  and if any Letters of Credit are  outstanding  at
such time the remainder,  if any, shall be deposited into the Collateral Account
for application to any Reimbursement Obligations. If the Borrower is required to
pay any  outstanding  LIBOR  Loans or Bid Rate  Loans by reason of this  Section
prior to the end of the applicable Interest Period therefor,  the Borrower shall
pay all amounts due under Section 4.4.

Section 2.9.  Continuation.

         So long as no Default or Event of Default  shall have  occurred  and be
continuing,  the  Borrower may on any  Business  Day,  with respect to any LIBOR
Loan,  elect to maintain such LIBOR Loan or any portion  thereof as a LIBOR Loan
by selecting a new Interest Period for such LIBOR Loan. Each new Interest Period
selected  under this Section shall  commence on the last day of the  immediately
preceding Interest Period. Each selection of a new Interest Period shall be made
by the  Borrower  giving to the Agent a Notice of  Continuation  not later  than
11:00 a.m. on the third Business Day prior to the date of any such Continuation.
Such notice by the Borrower of a Continuation shall be by telephone or telecopy,
confirmed  immediately  in writing if by  telephone,  in the form of a Notice of
Continuation,  specifying  (a) the proposed date of such  Continuation,  (b) the
LIBOR  Loans and  portions  thereof  subject  to such  Continuation  and (c) the
duration of the  selected  Interest  Period,  all of which shall be specified in
such manner as is necessary to comply with all limitations on Loans  outstanding
hereunder.  Each Notice of  Continuation  shall be irrevocable by and binding on
the Borrower once given. Promptly after receipt of a Notice of Continuation, the
Agent  shall  notify  each  Lender  by  telecopy,   or  other  similar  form  of
transmission, of the proposed Continuation. If the Borrower shall fail to select
in a timely manner a new Interest  Period for any LIBOR Loan in accordance  with
this  Section,  or if a Default or Event of Default  shall have  occurred and be
continuing,  such  Loan  will  automatically,  on the  last  day of the  current
Interest  Period  therefor,  Convert into a Base Rate Loan  notwithstanding  the
first sentence of Section 2.10. or the Borrower's  failure to comply with any of
the terms of such Section.

                                      -35-
<PAGE>

Section 2.10.  Conversion.

         So long as no Default or Event of Default  shall have  occurred  and be
continuing,  the Borrower may on any Business Day, upon the Borrower's giving of
a Notice of Conversion  to the Agent,  Convert all or a portion of a Loan of one
Type into a Loan of another  Type.  Any  Conversion  of a LIBOR Loan into a Base
Rate Loan shall be made on, and only on, the last day of an Interest  Period for
such LIBOR Loan and, upon  Conversion of a Base Rate Loan into a LIBOR Loan, the
Borrower  shall pay accrued  interest to the date of Conversion on the principal
amount so  Converted.  Each such Notice of  Conversion  shall be given not later
than 11:00 a.m. on the Business Day prior to the date of any proposed Conversion
into Base Rate  Loans  and on the  third  Business  Day prior to the date of any
proposed  Conversion  into LIBOR Loans.  Promptly  after  receipt of a Notice of
Conversion,  the Agent shall  notify each Lender by telecopy,  or other  similar
form of transmission,  of the proposed  Conversion.  Subject to the restrictions
specified  above,  each Notice of  Conversion  shall be by telephone  (confirmed
immediately  in  writing)  or  telecopy  in the form of a Notice  of  Conversion
specifying (a) the requested date of such Conversion, (b) the Type of Loan to be
Converted, (c) the portion of such Type of Loan to be Converted, (d) the Type of
Loan  such Loan is to be  Converted  into and (e) if such  Conversion  is into a
LIBOR Loan,  the requested  duration of the Interest  Period of such Loan.  Each
Notice of Conversion  shall be  irrevocable  by and binding on the Borrower once
given.

Section 2.11.  Notes.

         (a) Revolving  Note. The Revolving  Loans made by each Lender shall, in
addition  to this  Agreement,  also be  evidenced  by a  promissory  note of the
Borrower  substantially  in the form of  Exhibit  K (each a  "Revolving  Note"),
payable to the order of such Lender in a principal amount equal to the amount of
its Commitment as originally in effect and otherwise duly completed.

         (b) Bid Rate  Notes.  The Bid Rate Loans made by any Lender  shall,  in
addition  to this  Agreement,  also be  evidenced  by a  promissory  note of the
Borrower  substantially  in the  form of  Exhibit  L (each a "Bid  Rate  Note"),
payable to the order of such Lender and otherwise duly completed.

         (c) Records.  The date,  amount,  interest  rate,  Type and duration of
Interest  Periods  (if  applicable)  of each  Loan  made by each  Lender  to the
Borrower,  and each payment made on account of the principal  thereof,  shall be
recorded  by such Lender on its books and such  entries  shall be binding on the
Borrower absent manifest error.

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

                                      -36-
<PAGE>

Section 2.12.  Voluntary Reductions of the Commitment.

         The Borrower  shall have the right to terminate or reduce the aggregate
unused amount of the Commitments (for which purpose use of the Commitments shall
be deemed to include the aggregate  amount of Letter of Credit  Liabilities  and
the aggregate  principal amount of all outstanding  Swingline Loans and Bid Rate
Loans) at any time and from time to time  without  penalty or  premium  upon not
less  than 5  Business  Days  prior  written  notice  to the  Agent of each such
termination or reduction,  which notice shall specify the effective date thereof
and the amount of any such  reduction  and shall be  irrevocable  once given and
effective only upon receipt by the Agent. The Agent will promptly  transmit such
notice to each Lender.  The  Commitments,  once terminated or reduced may not be
increased  or  reinstated.   Any  reduction  in  the  aggregate  amount  of  the
Commitments  shall  result in a  proportionate  reduction  (rounded  to the next
lowest  integral  multiple of multiple of $100,000) in the Swingline  Commitment
and the L/C Commitment Amount.

Section 2.13.  Earlier Termination Date.

         The  Borrower  may request  that the Agent and the Lenders  shorten the
current  Termination  Date by one (1) year by executing  and  delivering  to the
Agent no later than  January 30, 2004, a written  request  substantially  in the
form of Exhibit M (a "Cancellation Request"). Once given, a Cancellation Request
shall be irrevocable  by, and binding on, the Borrower.  The Agent shall forward
to each  Lender  a copy of such  Cancellation  Request  delivered  to the  Agent
promptly after receipt thereof.  If the Borrower fails to deliver a Cancellation
Request  to the Agent by such  date,  then the  Termination  Date  shall  remain
unchanged.

Section 2.14.  Expiration or Maturity Date of Letters of Credit Past Termination
               Date.

         If on the date (the "Facility  Termination  Date") the  Commitments are
terminated  (whether  voluntarily,  by reason of the  occurrence  of an Event of
Default or otherwise),  there are any Letters of Credit  outstanding  hereunder,
the Borrower shall, on the Facility Termination Date, pay to the Agent an amount
of money equal to the Stated Amount of such Letter(s) of Credit for deposit into
the  Collateral  Account.  If a drawing  pursuant  to any such  Letter of Credit
occurs on or prior to the expiration date of such Letter of Credit, the Borrower
authorizes the Agent to use the monies  deposited in the  Collateral  Account to
make payment to the  beneficiary  with respect to such drawing or the payee with
respect to such presentment.  If no drawing occurs on or prior to the expiration
date of such Letter of Credit,  the Agent shall withdraw the monies deposited in
the Collateral  Account with respect to such outstanding  Letter of Credit on or
before the date 15  Business  Days after the  expiration  date of such Letter of
Credit and apply such funds to the Obligations,  if any, then due and payable in
the order prescribed by Section 10.4.

Section 2.15.  Amount Limitations.

         Notwithstanding  any other  term of this  Agreement  or any other  Loan
Document, at no time may:

                                      -37-
<PAGE>

         (a) The aggregate principal amount of all outstanding  Revolving Loans,
together with the aggregate  principal  amount of all outstanding Bid Rate Loans
and the aggregate  principal  amount of all outstanding  Swingline Loans and the
aggregate  amount of all  Letter of Credit  Liabilities,  exceed  the  aggregate
amount of the Commitments at such time; or

         (b) The aggregate  principal  amount of all  outstanding Bid Rate Loans
exceed the lesser of (i) $200,000,000 or (ii) 50% of the aggregate amount of the
Commitments at such time.

Section 2.16.  Increase of Commitments.

         The Borrower shall have the right to request increases in the aggregate
amount of the  Commitments  (provided that the aggregate  amount of increases in
the  Commitments  pursuant to this  Section  shall not exceed  $200,000,000)  by
providing  written notice to the Agent,  which notice shall be irrevocable  once
given. Each such increase in the Commitments must be an aggregate minimum amount
of $50,000,000  and integral  multiples of $10,000,000  in excess  thereof.  The
Agent  shall  promptly  notify each Lender of any such  request.  Each  existing
Lender shall have the right to increase its Commitment by an amount so that such
Lender's  Commitment  Percentage  shall  not be  decreased  as a result  of such
requested increase in the Commitments. Each Lender shall notify the Agent within
10 Business Days after receipt of the Agent's  notice whether such Lender wishes
to increase the amount of its Commitment.  If a Lender fails to deliver any such
notice to the Agent within such time period, then such Lender shall be deemed to
have  declined  to  increase  its  Commitment.  No Lender  shall be  required to
increase its Commitment and any new Lender(s) becoming a party to this Agreement
in connection with any such requested increase must be an Eligible Assignee.  In
the event a new Lender or Lenders  become a party to this  Agreement,  or if any
existing Lender agrees to increase its Commitment, such Lender shall on the date
it becomes a Lender  hereunder (or increases its  Commitment,  in the case of an
existing  Lender) (and as a condition  thereto)  purchase from the other Lenders
its Commitment  Percentage (as determined after giving effect to the increase of
Commitments) of any  outstanding  Revolving  Loans,  by making  available to the
Agent for the account of such other Lenders at the Principal Office, in same day
funds,  an  amount  equal  to the  sum of (A)  the  portion  of the  outstanding
principal amount of such Revolving Loans to be purchased by such Lender plus (B)
the  aggregate  amount of payments  previously  made by the other  Lenders under
Section 2.4.(j) which have not been repaid plus (C) interest  accrued and unpaid
to and as of such date on such portion of the  outstanding  principal  amount of
such Revolving Loans. The Borrower shall pay to the Lenders amounts payable,  if
any, to such Lenders  under  Section 4.4. as a result of the  prepayment  of any
such Revolving  Loans. No increase of the Commitments may be effected under this
Section if either (x) a Default or Event of Default shall be in existence on the
effective  date of such increase or (y) any  representation  or warranty made or
deemed  made by the  Borrower  or any other Loan Party in any Loan  Document  to
which any such Loan Party is a party is not (or would not be) true or correct on
the effective date of such increase  (except for  representations  or warranties
which  expressly  relate  solely to an earlier  date).  In  connection  with any
increase in the aggregate amount of the Commitments pursuant to this subsection,
(a) any  Lender  becoming  a party  hereto  shall  execute  such  documents  and
agreements as the Agent may  reasonably  request and (b) the Borrower shall make
appropriate  arrangements  so that  each new  Lender,  and any  existing  Lender
increasing its Commitment,  receives a new or replacement  Note, as appropriate,
in the  amount  of  such  Lender's  Commitment  within  2  Business  Days of the
effectiveness of the applicable increase in the aggregate amount of Commitments.

                                      -38-
<PAGE>

            ARTICLE III. PAYMENTS, FEES AND OTHER GENERAL PROVISIONS

Section 3.1.  Payments.

         Except  to the  extent  otherwise  provided  herein,  all  payments  of
principal,  interest  and other  amounts to be made by the  Borrower  under this
Agreement or any other Loan Document  shall be made in Dollars,  in  immediately
available funds, without deduction, set-off or counterclaim, to the Agent at its
Principal  Office,  not later than 2:00 p.m.  on the date on which such  payment
shall  become due (each such payment made after such time on such due date to be
deemed  to have been  made on the next  succeeding  Business  Day).  Subject  to
Sections  3.2.  and 3.3.,  the Agent,  or any Lender for whose  account any such
payment  is made,  may (but shall not be  obligated  to) debit the amount of any
such payment which is not made by such time from any special or general  deposit
account of the Borrower with the Agent or such Lender,  as the case may be (with
notice to the Borrower, the other Lenders and the Agent). The Borrower shall, at
the time of making each payment under this Agreement or any Note, specify to the
Agent the amounts payable by the Borrower  hereunder to which such payment is to
be applied. Each payment received by the Agent for the account of a Lender under
this  Agreement  or any Note  shall  be paid to such  Lender  at the  applicable
Lending Office of such Lender no later than 5:00 p.m. on the date of receipt. If
the  Agent  fails to pay such  amount to a Lender as  provided  in the  previous
sentence,  the Agent shall pay  interest on such amount until paid at a rate per
annum  equal to the Federal  Funds Rate from time to time in effect.  If the due
date of any  payment  under  this  Agreement  or any other Loan  Document  would
otherwise  fall on a day which is not a Business Day such date shall be extended
to the next succeeding Business Day and interest shall be payable for the period
of such extension.

Section 3.2.  Pro Rata Treatment.

         Except to the extent otherwise provided herein: (a) each borrowing from
the Lenders under Section  2.1.(a) shall be made from the Lenders,  each payment
of the Fees under Section  3.6.(a),  the first  sentence of Section  3.6.(b) and
Section  3.6.(c)  shall  be made  for  the  account  of the  Lenders,  and  each
termination  or reduction of the amount of the  Commitments  under Section 2.12.
shall  be  applied  to the  respective  Commitments  of the  Lenders,  pro  rata
according to the amounts of their  respective  Commitments;  (b) each payment or
prepayment of principal of Revolving Loans by the Borrower shall be made for the
account  of the  Lenders  pro  rata in  accordance  with the  respective  unpaid
principal  amounts  of the  Revolving  Loans  held  by  them,  provided  that if
immediately  prior to  giving  effect  to any such  payment  in  respect  of any
Revolving  Loans the outstanding  principal  amount of the Revolving Loans shall
not be  held by the  Lenders  pro  rata  in  accordance  with  their  respective
Commitments in effect at the time such Loans were made,  then such payment shall
be applied to the Revolving  Loans in such manner as shall result,  as nearly as
is practicable, in the outstanding principal amount of the Revolving Loans being
held by the Lenders pro rata in accordance  with their  respective  Commitments;
(c) each  payment of interest on Revolving  Loans by the Borrower  shall be made
for the  account  of the  Lenders  pro rata in  accordance  with the  amounts of
interest on such Loans then due and payable to the respective  Lenders;  (d) the
making,  Conversion and  Continuation  of Revolving  Loans of a particular  Type
(other than  Conversions  provided  for by Section  4.6.) shall be made

                                      -39-
<PAGE>

pro rata  among  the  Lenders  according  to the  amounts  of  their  respective
Commitments (in the case of making of Loans) or their  respective  Loans (in the
case of Conversions and  Continuations  of Loans) and the then current  Interest
Period for each Lender's portion of each Loan of such Type shall be coterminous;
(e) the  Lenders'  participation  in, and  payment  obligations  in respect  of,
Letters of Credit under Section 2.4., shall be pro rata in accordance with their
respective   Commitments;   (f)  the  Lenders'  participation  in,  and  payment
obligations  in respect of,  Swingline  Loans under  Section  2.3.,  shall be in
accordance with their respective Commitments;  and (g) each mandatory prepayment
of principal of Bid Rate Loans by the Borrower pursuant to Section 2.8.(b) shall
be made  for  account  of the  Lenders  then  owed Bid  Rate  Loans  pro rata in
accordance with the respective  unpaid  principal  amounts of the Bid Rate Loans
then owing to each such Lender.  All payments of principal,  interest,  fees and
other amounts in respect of the Swingline  Loans shall be for the account of the
Swingline  Lender only  (except to the extent any Lender  shall have  acquired a
participating interest in any such Swingline Loan pursuant to Section 2.3.(e)).

Section 3.3.  Sharing of Payments, Etc.

         If a Lender shall obtain  payment of any  principal of, or interest on,
any Loan  made by it to the  Borrower  under  this  Agreement,  or shall  obtain
payment on any other  Obligation  owing by the Borrower or a Loan Party  through
the exercise of any right of set-off,  banker's lien or  counterclaim or similar
right or  otherwise  or through  voluntary  prepayments  directly to a Lender or
other payments made by the Borrower to a Lender not in accordance with the terms
of this Agreement and such payment should be distributed to the Lenders pro rata
in accordance  with Section 3.2. or Section 10.4.,  as  applicable,  such Lender
shall promptly purchase from the other Lenders  participations in (or, if and to
the extent specified by such Lender,  direct interests in) the Loans made by the
other Lenders or other  Obligations  owed to such other Lenders in such amounts,
and make such other adjustments from time to time as shall be equitable,  to the
end that all the Lenders  shall share the  benefit of such  payment  (net of any
reasonable  expenses  which  may be  incurred  by such  Lender in  obtaining  or
preserving  such  benefit) pro rata in  accordance  with Section 3.2. or Section
10.4.  To such end, all the Lenders  shall make  appropriate  adjustments  among
themselves (by the resale of  participations  sold or otherwise) if such payment
is rescinded or must otherwise be restored.  The Borrower agrees that any Lender
so  purchasing  a  participation  (or  direct  interest)  in the  Loans or other
Obligations  owed to such other  Lenders  may  exercise  all rights of  set-off,
banker's lien, counterclaim or similar rights with respect to such participation
as fully as if such Lender  were a direct  holder of Loans in the amount of such
participation. Nothing contained herein shall require any Lender to exercise any
such right or shall affect the right of any Lender to  exercise,  and retain the
benefits of exercising, any such right with respect to any other indebtedness or
obligation of the Borrower.

Section 3.4.  Several Obligations.

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

                                      -40-
<PAGE>

Section 3.5.  Minimum Amounts.

         (a) Borrowings and Conversions. Each borrowing of Base Rate Loans shall
be in an  aggregate  minimum  amount of  $1,000,000  and  integral  multiples of
$500,000 in excess  thereof.  Each borrowing and each  Conversion of LIBOR Loans
shall be in an aggregate minimum amount of $2,000,000 and integral  multiples of
$1,000,000  in excess of that  amount.  Each Bid Rate Loan shall be in a minimum
amount of $2,000,000 and integral multiples of $1,000,000 in excess thereof.

         (b) Prepayments.  Each voluntary prepayment of Revolving Loans shall be
in an aggregate minimum amount of $1,000,000 and integral  multiples of $500,000
in excess  thereof (or, if less,  the  aggregate  principal  amount of Revolving
Loans then outstanding).

         (c) Reductions of Commitments.  Each reduction of the Commitments under
Section  2.12.  shall be in an  aggregate  minimum  amount  of  $10,000,000  and
integral multiples of $5,000,000 in excess thereof.

         (d)  Letters of Credit.  The  initial  Stated  Amount of each Letter of
Credit shall be at least $500,000.

Section 3.6.  Fees.

         (a)  Facility  Fees.  The  Borrower  agrees to pay to the Agent for the
account of each Lender a facility  fee equal to the average  daily amount of the
Commitment of such Lender  (whether or not utilized)  times the Facility Fee for
the period from and including the Agreement  Date to but excluding the date such
Commitment is terminated or reduced to zero or the Termination Date, such fee to
be paid in arrears on (i) the last  Business Day of March,  June,  September and
December in each year, (ii) the date of each reduction in the  Commitments  (but
only on the amount of the reduction) and (iii) on the Termination Date.

         (b) Letter of Credit Fees. The Borrower  agrees to pay to the Agent for
the  account of each  Lender a letter of credit fee at a rate per annum equal to
the  Applicable  Margin for LIBOR Loans times the daily average Stated Amount of
each Letter of Credit for the period from and  including the date of issuance of
such  Letter  of Credit  (x) to and  including  the date  such  Letter of Credit
expires or is  terminated or (y) to but excluding the date such Letter of Credit
is drawn in full. In addition,  the Borrower  shall pay to the Agent for its own
account  and not the account of any  Lender,  a fronting  fee in respect of each
Letter of Credit at the rate equal to  one-eighth  of one percent  (0.125%)  per
annum on the daily average Stated Amount of such Letter of Credit for the period
from and  including  the date of  issuance  of such  Letter of Credit (A) to and
including the date such Letter of Credit  expires or is terminated or (B) to but
excluding the date such Letter of Credit is drawn in full. The fees provided for
in the immediately preceding two sentences shall be nonrefundable and payable in
arrears  (i)  monthly  on the  first  day of each  calendar  month,  (ii) on the
Termination Date, (iii) on the date the Commitments are terminated or reduced to
zero and (iv) thereafter from time to time on demand of the Agent.  The Borrower
shall pay  directly  to the Agent from time to time on demand  all  commissions,
charges, costs and expenses in the amounts customarily charged by the Agent from
time to time in like  circumstances  with

                                      -41-
<PAGE>

respect to the issuance of each Letter of Credit, drawings, amendments and other
transactions relating thereto.

         (c)  Maturity  Fee.  If  the  Termination  Date  is  not  shortened  in
accordance  with Section 2.13.,  the Borrower agrees to pay to the Agent for the
account of each Lender a fee equal to one-quarter of one percent  (0.25%) of the
amount of such Lender's Commitment (whether or not utilized).  Such fee shall be
due and payable in full on January 30, 2004.

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

Section 3.7.  Computations.

         Unless  otherwise  expressly set forth herein,  any accrued interest on
any Loan, any Fees or any other  Obligations  due hereunder shall be computed on
the basis of a year of 360 days and the actual number of days elapsed.

Section 3.8.  Usury.

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

Section 3.9.  Agreement Regarding Interest and Charges.

         The parties  hereto  hereby  agree and  stipulate  that the only charge
imposed upon the Borrower for the use of money in connection with this Agreement
is and  shall be the  interest  specifically  described  in  Section  2.5.(a)(i)
through (iii) and in Section 2.3.(c). Notwithstanding the foregoing, the parties
hereto  further  agree and  stipulate  that all agency fees,  syndication  fees,
facility fees,  closing fees, letter of credit fees,  underwriting fees, default
charges,  late charges,  funding or "breakage" charges,  increased cost charges,
attorneys'  fees and  reimbursement  for costs and expenses paid by the Agent or
any Lender to third parties or for damages  incurred by the Agent or any Lender,
are charges made to compensate the Agent or any such Lender for  underwriting or
administrative  services and costs or losses  performed  or incurred,  and to be
performed  or  incurred,  by the Agent and the Lenders in  connection  with this
Agreement and shall under no  circumstances  be deemed to be charges for the use
of money.  All  charges  other than  charges for the use of money shall be fully
earned and nonrefundable when due.

Section 3.10.  Statements of Account.

         The Agent will  account to the  Borrower  monthly  with a statement  of
Loans,  Letters of Credit,  accrued interest and Fees, charges and payments made
pursuant  to this  Agreement  and

                                      -42-
<PAGE>

the other Loan Documents, and such account rendered by the Agent shall be deemed
conclusive  upon Borrower  absent  manifest  error.  The failure of the Agent to
deliver such a statement of accounts shall not relieve or discharge the Borrower
from any of its obligations hereunder.

Section 3.11.  Defaulting Lenders.

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

         (b) Purchase or Cancellation  of Defaulting  Lender's  Commitment.  Any
Lender  who is not a  Defaulting  Lender  shall  have  the  right,  but  not the
obligation,  in its sole  discretion,  to acquire all of a  Defaulting  Lender's
Commitment. Any Lender desiring to exercise such right shall give written notice
thereof to the Agent and the  Borrower  no sooner  than 2 Business  Days and not
later than 5 Business  Days after such  Defaulting  Lender  became a  Defaulting
Lender.  If more than one Lender  exercises  such right,  each such Lender shall
have the right to acquire an amount of such  Defaulting  Lender's  Commitment in
proportion to the  Commitments of the other Lenders  exercising  such right.  If
after such 5th Business Day, the Lenders have not elected to purchase all of the
Commitment of such Defaulting  Lender,  then the Borrower may, by giving written
notice  thereof  to the Agent,  such  Defaulting  Lender and the other  Lenders,
either (i) demand  that such  Defaulting  Lender  assign  its  Commitment  to an
Eligible  Assignee  subject to and in accordance  with the provisions of Section
12.5.(d)  for the  purchase  price  provided  for  below or (ii)  terminate  the
Commitment of such Defaulting Lender,  whereupon such Defaulting Lender shall no
longer be a party  hereto or have any rights or  obligations  hereunder or under
any of the other Loan  Documents.  No party  hereto  shall  have any  obligation
whatsoever to initiate any such  replacement or to assist in finding an Eligible
Assignee. Upon any such purchase or

                                      -43-
<PAGE>

assignment,  the  Defaulting  Lender's  interest  in the  Loans  and its  rights
hereunder (but not its liability in respect  thereof or under the Loan Documents
or this  Agreement  to the  extent the same  relate to the  period  prior to the
effective date of the purchase) shall terminate on the date of purchase, and the
Defaulting Lender shall promptly execute all documents  reasonably  requested to
surrender  and transfer  such  interest to the  purchaser  or assignee  thereof,
including   an   appropriate    Assignment   and   Acceptance   Agreement   and,
notwithstanding  Section  12.5.(d),  shall pay to the Agent an assignment fee in
the amount of $7,000.  The  purchase  price for the  Commitment  of a Defaulting
Lender  shall be equal to the  amount  of the  principal  balance  of the  Loans
outstanding and owed by the Borrower to the Defaulting Lender.  Prior to payment
of such  purchase  price to a Defaulting  Lender,  the Agent shall apply against
such  purchase  price any  amounts  retained  by the Agent  pursuant to the last
sentence of the  immediately  preceding  subsection  (a). The Defaulting  Lender
shall be entitled to receive  amounts owed to it by the Borrower  under the Loan
Documents  which  accrued  prior to the date of the  default  by the  Defaulting
Lender,  to the extent the same are  received  by the Agent from or on behalf of
the Borrower. There shall be no recourse against any Lender or the Agent for the
payment of such sums except to the extent of the  receipt of  payments  from any
other party or in respect of the Loans.

Section 3.12.  Taxes.

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

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

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

                                      -44-
<PAGE>

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

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

         (c) Tax  Forms.  Prior  to the  date  that any  Lender  or  participant
organized under the laws of a jurisdiction  outside the United States of America
becomes a party hereto,  such Person shall deliver to the Borrower and the Agent
such  certificates,  documents  or other  evidence,  as required by the Internal
Revenue Code or Treasury Regulations issued pursuant thereto (including Internal
Revenue Service Forms W-8ECI and W-8BEN, as applicable, or appropriate successor
forms), properly completed, currently effective and duly executed by such Lender
or  participant  establishing  that payments to it hereunder and under the Notes
are (i) not subject to United States Federal backup  withholding tax or (ii) not
subject to United States Federal withholding tax under the Internal Revenue Code
because such payment is either  effectively  connected  with the conduct by such
Lender or  participant  of a trade or business  in the United  States or totally
exempt from United States Federal  withholding  tax by reason of the application
of the  provisions  of a treaty  to which the  United  States is a party or such
Lender is otherwise wholly exempt.  In addition,  any such Lender or participant
shall  deliver  to the  Borrower  and  the  Agent  further  copies  of any  such
certificate,  document  or other  evidence  on or before  the date that any such
certificate,  document or other evidence  expires or becomes  obsolete and after
the  occurrence  of any  event  requiring  a  change  in the  most  recent  form
previously  delivered  by it,  in each case  establishing  that  payments  to it
hereunder  and  under the Notes are (i) not  subject  to United  States  Federal
backup withholding tax or (ii) not subject to United States Federal  withholding
tax under the Internal  Revenue Code because such payment is either  effectively
connected  with the conduct by such Lender or participant of a trade or business
in the United States or totally  exempt from United States  Federal  withholding
tax by  reason of the  application  of the  provisions  of a treaty to which the
United  States  is a party or such  Lender or  participant,  as  applicable,  is
otherwise wholly exempt,  unless an event (including,  without  limitation,  any
change  in  Applicable  Law) has  occurred  prior to the date on which  any such
delivery  would  otherwise  be required  which  renders  all such  certificates,
documents and other  evidence  wholly  inapplicable  or which would prevent such
Lender or  participant,  as applicable,  from duly completing and delivering any
such certificates, documents or other evidence form with respect to it, and such
Lender or participant,  as applicable,  so advises the Borrower and the Agent in
writing.

                                      -45-
<PAGE>

                       ARTICLE IV. YIELD PROTECTION, ETC.

Section 4.1.  Additional Costs; Capital Adequacy.

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

         (b) Lender's Suspension of LIBOR Loans.  Without limiting the effect of
the provisions of the immediately preceding subsection (a), if, by reason of any
Regulatory  Change,  any Lender either (i) incurs  Additional  Costs based on or
measured by the excess  above a  specified  level of the amount of a category of
deposits or other liabilities of such Lender that includes deposits by reference
to which the  interest  rate on LIBOR  Loans is  determined  as provided in this
Agreement or a category of  extensions  of credit or other assets of such Lender
that includes LIBOR Loans or (ii) becomes  subject to restrictions on the amount
of such a category  of  liabilities  or assets that it may hold,  then,  if such
Lender  so elects by notice  to the  Borrower  (with a copy to the  Agent),  the
obligation  of such Lender to make or Continue,  or to Convert any other Type of
Loans into,  LIBOR Loans  hereunder  shall be  suspended  until such  Regulatory
Change  ceases to be in effect (in which  case the  provisions  of Section  4.6.
shall apply).

         (c) Additional Costs in Respect of Letters of Credit.  Without limiting
the obligations of the Borrower under the preceding  subsections of this Section
(but  without  duplication),  if as a result  of any  Regulatory  Change  or any
risk-based capital guideline or other requirement heretofore or hereafter issued
by any  Governmental  Authority  there  shall be  imposed,  modified  or  deemed
applicable  any tax,  reserve,  special  deposit,  capital  adequacy  or similar
requirement  against or with  respect to or measured by  reference to Letters of
Credit and the result  shall be to increase the cost to the Agent of issuing (or
any  Lender of  purchasing  participations  in) or  maintaining  its  obligation
hereunder  to issue  (or  purchase  participations  in) any  Letter of Credit

                                      -46-
<PAGE>

or reduce any amount  receivable by the Agent or any Lender hereunder in respect
of any Letter of Credit,  then,  upon  demand by the Agent or such  Lender,  the
Borrower shall pay promptly,  and in any event within 3 Business Days of demand,
to the Agent for its account or the account of such Lender, as applicable,  from
time to time as specified by the Agent or a Lender,  such additional  amounts as
shall be sufficient to  compensate  the Agent or such Lender for such  increased
costs or reductions in amount.

         (d) Notification and  Determination  of Additional  Costs.  Each of the
Agent and each Lender agrees to notify the Borrower of any event occurring after
the Agreement Date entitling the Agent or such Lender to compensation  under any
of the  preceding  subsections  of this  Section  as  promptly  as  practicable;
provided,  however,  the  failure of the Agent or any Lender to give such notice
shall not release the Borrower from any of its obligations hereunder;  provided,
however,  that  notwithstanding  the foregoing  provisions of this Section,  the
Agent or a Lender, as the case may be, shall not be entitled to compensation for
any such amount  relating to any period ending more than six months prior to the
date that the Agent or such Lender,  as applicable,  first notifies the Borrower
in writing  thereof or for any amounts  resulting from a change by any Lender of
its Lending  Office (other than changes  required by Applicable  Law). The Agent
and or such Lender agrees to furnish to the Borrower a certificate setting forth
the  basis  and  amount  of  each  request  by the  Agent  or  such  Lender  for
compensation  under this Section.  Absent manifest error,  determinations by the
Agent or any Lender of the effect of any Regulatory  Change shall be conclusive,
provided  that such  determinations  are made on a reasonable  basis and in good
faith.

Section 4.2.  Suspension of LIBOR Loans.

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

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

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

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

Section 4.3.  Illegality.

         Notwithstanding  any other provision of this  Agreement,  if it becomes
unlawful for any Lender to honor its  obligation to make or maintain LIBOR Loans
hereunder,  then such Lender

                                      -47-
<PAGE>

shall promptly  notify the Borrower  thereof (with a copy to the Agent) and such
Lender's  obligation to make or Continue,  or to Convert Loans of any other Type
into,  LIBOR Loans shall be  suspended  until such time as such Lender may again
make and  maintain  LIBOR Loans (in which case the  provisions  of Section  4.6.
shall be applicable).

Section 4.4.  Compensation.

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

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

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

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

Section 4.5.  Affected Lenders.

         If (a) a Lender  requests  compensation  pursuant to Section  3.12.  or
4.1.,  and the  Requisite  Lenders  are not  also  doing  the  same,  or (b) the
obligation of any Lender to make LIBOR Loans or to Continue,  or to Convert Base
Rate Loans into,  LIBOR Loans shall be suspended  pursuant to Section 4.1.(b) or
4.3. but the  obligation of the Requisite  Lenders shall not have been suspended
under such  Sections,  then, so long as there does not then exist any Default or
Event of  Default,  the  Borrower  may either (i) demand  that such  Lender (the
"Affected  Lender"),  and upon such demand the Affected  Lender shall  promptly,
assign its Commitments to an Eligible Assignee subject to and in accordance with
the  provisions of Section  12.5.(d) for a purchase price equal to the aggregate
principal  balance of Loans then owing to the  Affected  Lender plus any accrued
but unpaid  interest  thereon and accrued but unpaid fees owing to the  Affected
Lender,  or (ii) pay to the Affected Lender the aggregate  principal  balance of
Loans then owing to the  Affected  Lender plus any  accrued but unpaid  interest
thereon and accrued but unpaid fees owing to the Affected Lender,  whereupon the
Affected  Lender  shall  no  longer  be a party  hereto  or have any  rights  or
obligations  hereunder  or under any of the other  Loan  Documents.  Each of the
Agent and the Affected Lender shall  reasonably  cooperate in  effectuating  the
replacement of such Affected Lender under this Section, but at no time shall the
Agent,  such  Affected  Lender

                                      -48-
<PAGE>

nor any other  Lender be obligated  in any way  whatsoever  to initiate any such
replacement  or to assist in finding an Eligible  Assignee.  The exercise by the
Borrower of its rights under this Section shall be at the  Borrower's  sole cost
and expenses and at no cost or expense to the Agent,  the Affected Lender or any
of the other  Lenders.  The terms of this Section shall not in any way limit the
Borrower's  obligation to pay to any Affected Lender  compensation owing to such
Affected Lender pursuant to Section 3.12. or 4.1.

Section 4.6.  Treatment of Affected Loans.

         If the obligation of any Lender to make LIBOR Loans or to Continue,  or
to Convert  Base Rate Loans into,  LIBOR Loans  shall be  suspended  pursuant to
Section  4.1.(b),  4.2.  or  4.3.,  then  such  Lender's  LIBOR  Loans  shall be
automatically  Converted  into  Base Rate  Loans on the last  day(s) of the then
current  Interest  Period(s)  for LIBOR Loans (or,  in the case of a  Conversion
required by Section  4.1.(b) or 4.3.,  on such  earlier  date as such Lender may
specify to the  Borrower  with a copy to the Agent)  and,  unless and until such
Lender  gives  notice as  provided  below that the  circumstances  specified  in
Section 4.1. or 4.3. that gave rise to such Conversion no longer exist:

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

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

If such Lender gives notice to the Borrower  (with a copy to the Agent) that the
circumstances specified in Section 4.1. or 4.3. that gave rise to the Conversion
of such  Lender's  LIBOR Loans  pursuant to this  Section no longer exist (which
such Lender agrees to do promptly upon such circumstances ceasing to exist) at a
time when LIBOR Loans made by other Lenders are outstanding,  then such Lender's
Base Rate Loans shall be  automatically  Converted,  on the first  day(s) of the
next  succeeding  Interest  Period(s) for such  outstanding  LIBOR Loans, to the
extent  necessary so that,  after giving effect  thereto,  all Loans held by the
Lenders  holding  LIBOR  Loans  and by such  Lender  are  held  pro  rata (as to
principal  amounts,  Types  and  Interest  Periods)  in  accordance  with  their
respective Commitments.

Section 4.7.  Change of Lending Office.

         Each Lender agrees that it will use reasonable  efforts to designate an
alternate  Lending  Office  with  respect  to any of its Loans  affected  by the
matters or circumstances described in Sections 3.12., 4.1. or 4.3. to reduce the
liability of the Borrower or avoid the results provided  thereunder,  so long as
such  designation  is not  disadvantageous  to such Lender as determined by such
Lender in its sole discretion,  except that such Lender shall have no obligation
to designate a Lending Office located in the United States of America.

                                      -49-
<PAGE>

Section 4.8.  Assumptions Concerning Funding of LIBOR Loans.

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

                         ARTICLE V. CONDITIONS PRECEDENT

Section 5.1.  Initial Conditions Precedent.

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

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

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

                  (ii)  Revolving  Notes  and Bid  Rate  Notes  executed  by the
         Borrower,  payable to each Lender (or Designated Lender, if applicable)
         and complying with the applicable  provisions of Section 2.11., and the
         Swingline Note executed by the Borrower;

                  (iii) The Guaranty  executed by each Guarantor  existing as of
         the Effective Date;

                  (iv) An opinion of  Sullivan & Worcester  LLP,  counsel to the
         Loan  Parties,  addressed to the Agent,  the Lenders and the  Swingline
         Lender,  substantially  in the form of  Exhibit  N-1,  and  opinion  of
         Ballard  Spahr  Andrews  &  Ingersoll,   LLP,   special   Maryland  and
         Pennsylvania  counsel to the Loan Parties,  addressed to the Agent, the
         Lenders and the Swingline Lender,  substantially in the form of Exhibit
         N-2;

                  (v) The declaration of trust of the Borrower certified as of a
         recent date by the Department of Assessments  and Taxation of the State
         of Maryland;

                  (vi) A good standing  certificate with respect to the Borrower
         issued  as of a  recent  date  by the  Department  of  Assessments  and
         Taxation of the State of Maryland and  certificates of qualification to
         transact  business  or  other  comparable  certificates  issued  by the
         Secretary  of  State  (and  any  state   department  of  taxation,   as
         applicable)  of each state in which the  Borrower  is required to be so
         qualified;

                                      -50-
<PAGE>

                  (vii) A certificate  of incumbency  signed by the Secretary or
         Assistant  Secretary  of the  Borrower  with  respect  to  each  of the
         officers  of the  Borrower  authorized  to execute and deliver the Loan
         Documents  to which the  Borrower  is a party and the  officers  of the
         Borrower then  authorized to deliver  Notices of Borrowing,  Notices of
         Swingline  Borrowings,   Bid  Rate  Quote  Requests,   Bid  Rate  Quote
         Acceptances,  Notices of Continuation  and Notices of Conversion and to
         request the issuance of Letters of Credit;

                  (viii)  Copies,   certified  by  the  Secretary  or  Assistant
         Secretary of the  Borrower,  of all corporate  (or  comparable)  action
         taken  by  the  Borrower  to  authorize  the  execution,  delivery  and
         performance of the Loan Documents to which the Borrower is a party;

                  (ix) The articles of incorporation,  articles of organization,
         certificate of limited  partnership or other comparable  organizational
         instrument (if any) of each Guarantor  certified as of a recent date by
         the Secretary of State of the State of formation of such Guarantor;

                  (x) A certificate  of good standing or  certificate of similar
         meaning  with respect to each  Guarantor  issued as of a recent date by
         the Secretary of State of the State of formation of each such Guarantor
         and  certificates  of  qualification  to  transact  business  or  other
         comparable  certificates  issued by each  Secretary  of State  (and any
         state  department of taxation,  as  applicable)  of each state in which
         such Guarantor is required to be so qualified;

                  (xi) A certificate  of  incumbency  signed by the Secretary or
         Assistant Secretary (or other individual  performing similar functions)
         of  each  Guarantor  with  respect  to  each  of the  officers  of such
         Guarantor authorized to execute and deliver the Loan Documents to which
         such Guarantor is a party;

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

                  (xiii) A copy of (x) each of the  documents,  instruments  and
         agreements  evidencing  any of the  Indebtedness  described on Schedule
         6.1.(g) and (y) the Advisory  Agreement,  the Management  Agreement and
         each other Material  Contract,  in each case certified as true, correct
         and complete by the chief executive  officer or chief financial officer
         of the Borrower;

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

                  (xv) A Compliance  Certificate  calculated  as of December 31,
         2000;

                                      -51-
<PAGE>

                  (xvi) A letter  from  the  Agent  under  the  Existing  Credit
         Agreement  to the effect that such  agreement  has  terminated  and all
         amounts outstanding thereunder have been paid; and

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

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

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

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

                  (iii) The Borrower and its  Subsidiaries  shall have  received
         all approvals,  consents and waivers,  and shall have made or given all
         necessary  filings and notices as shall be required to  consummate  the
         transactions  contemplated hereby without the occurrence of any default
         under,  conflict with or violation of (1) any Applicable Law or (2) any
         agreement,  document or  instrument  to which the Borrower or any other
         Loan  Party  is a party or by  which  any of them or  their  respective
         properties  is bound,  except for such  approvals,  consents,  waivers,
         filings and notices  the  receipt,  making or giving of which would not
         reasonably  be likely to (A) have a  Material  Adverse  Effect,  or (B)
         restrain or enjoin,  impose  materially  burdensome  conditions  on, or
         otherwise  materially and adversely  affect the ability of the Borrower
         or any other  Loan  Party to  fulfill  its  obligations  under the Loan
         Documents to which it is a party; and

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

Section 5.2.  Conditions Precedent to All Loans and Letters of Credit.

         The obligations of the Lenders to make any Loans, of the Agent to issue
Letters of Credit,  and of the Swingline  Lender to make any Swingline  Loan are
all subject to the further condition  precedent that: (a) no Default or Event of
Default  shall have  occurred and be  continuing as of the date of the making of
such  Loan or  date of  issuance  of  such  Letter  of  Credit  or  would  exist
immediately after giving effect thereto;  (b) the representations and warranties
made or  deemed

                                      -52-
<PAGE>

made by the  Borrower  and each other Loan Party in the Loan  Documents to which
any of them is a party,  shall be true and  correct on and as of the date of the
making of such Loan or date of  issuance  of such Letter of Credit with the same
force and  effect as if made on and as of such date  except to the  extent  that
such  representations and warranties  expressly relate solely to an earlier date
(in which  case such  representations  and  warranties  shall have been true and
accurate  on and as of such  earlier  date) and  except  for  changes in factual
circumstances specifically and expressly permitted hereunder and (c) in the case
of the  borrowing of  Revolving  Loans,  the Agent shall have  received a timely
Notice of Borrowing.  Each Credit Event shall  constitute a certification by the
Borrower to the effect set forth in the preceding  sentence (both as of the date
of the giving of notice  relating to such Credit Event and,  unless the Borrower
otherwise  notifies the Agent prior to the date of such Credit Event,  as of the
date of the occurrence of such Credit Event). In addition,  if such Credit Event
is the making of a Loan, the Borrower shall be deemed to have represented to the
Agent and the  Lender at the time such Loan is made that all  conditions  to the
making of such Loan contained in Article V. have been satisfied.

Section 5.3.  Conditions as Covenants.

         If the Lenders make any Loans,  or the Agent issues a Letter of Credit,
prior to the satisfaction of all conditions precedent set forth in Sections 5.1.
and 5.2., the Borrower shall  nevertheless cause such condition or conditions to
be satisfied  within 5 Business  Days after the date of the making of such Loans
or the  issuance  of such  Letter of Credit.  Unless set forth in writing to the
contrary,  the  making  of its  initial  Loan by a  Lender  shall  constitute  a
certification  by such  Lender  to the  Agent  and the  other  Lenders  that the
Borrower has satisfied the  conditions  precedent for initial Loans set forth in
Sections 5.1. and 5.2.

                   ARTICLE VI. REPRESENTATIONS AND WARRANTIES

Section 6.1.  Representations and Warranties.

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

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

         (b) Ownership  Structure.  As of the Agreement  Date Part I of Schedule
6.1.(b) is a complete  and  correct  list of all  Subsidiaries  of the  Borrower
setting forth for each such Subsidiary,  (i) the jurisdiction of organization of
such  Subsidiary,  (ii)  each  Person  holding  any  Equity  Interests  in  such
Subsidiary,  (iii) the nature of the Equity  Interests held by each such

                                      -53-
<PAGE>

Person, (iv) the percentage of ownership of such Subsidiary  represented by such
Equity Interests and (v) whether such Subsidiary is a Material Subsidiary and/or
an Excluded Subsidiary.  The parties hereto acknowledge that as of the Agreement
Date, neither HPT nor SNH is a Subsidiary. Except as disclosed in such Schedule,
as of the  Agreement  Date (i) each of the Borrower and its  Subsidiaries  owns,
free and  clear  of all  Liens,  and has the  unencumbered  right  to vote,  all
outstanding  Equity  Interests  in each  Person  shown  to be held by it on such
Schedule,  (ii) all of the issued  and  outstanding  capital  stock of each such
Person   organized  as  a  corporation  is  validly   issued,   fully  paid  and
nonassessable  and  (iii)  there  are  no  outstanding  subscriptions,  options,
warrants,  commitments,  preemptive rights or agreements of any kind (including,
without  limitation,  any  stockholders'  or voting  trust  agreements)  for the
issuance, sale, registration or voting of, or outstanding securities convertible
into,  any  additional  shares of capital stock of any class,  or partnership or
other ownership  interests of any type in, any such Person.  As of the Agreement
Date  Part II of  Schedule  6.1.(b)  correctly  sets  forth  all  Unconsolidated
Affiliates of the Borrower, including the correct legal name of such Person, the
type of legal entity which each such Person is, and all Equity Interests in such
Person held directly or indirectly by the Borrower.

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

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

         (e) Compliance with Law;  Governmental  Approvals.  The Borrower,  each
Subsidiary  and each other Loan Party is in  compliance  with each  Governmental
Approval  applicable  to it and in  compliance  with all  other  Applicable  Law
(including without limitation,  Environmental

                                      -54-
<PAGE>

Laws) relating to the Borrower, a Subsidiary or such other Loan Party except for
noncompliances  which, and Governmental  Approvals the failure to possess which,
would not, individually or in the aggregate, cause a Default or Event of Default
or have a Material Adverse Effect.

         (f) Title to Properties;  Liens.  As of the Agreement  Date,  Part I of
Schedule  6.1.(f)  sets  forth all of the real  property  owned or leased by the
Borrower, each other Loan Party and each other Subsidiary.  Each such Person has
good,  marketable  and legal  title to, or a valid  leasehold  interest  in, its
respective  assets.  As of the  Agreement  Date,  there are no Liens against any
assets of the  Borrower,  any  Subsidiary  or any other  Loan  Party  except for
Permitted Liens.

         (g)  Existing  Indebtedness.  Schedule  6.1.(g) is, as of February  28,
2001, a complete and correct listing of all (i) Indebtedness of the Borrower and
its Subsidiaries,  including without limitation,  Guarantees of the Borrower and
its   Subsidiaries,   and  indicating   whether  such  Indebtedness  is  Secured
Indebtedness or Unsecured Indebtedness.  During the period from such date to the
Agreement  Date,  neither the Borrower nor any Subsidiary  incurred any material
Indebtedness  except  as set  forth  on  such  Schedule.  The  Borrower  and its
Subsidiaries  have performed and are in compliance with all of the terms of such
Indebtedness and all instruments and agreements relating thereto, and no default
or event of default,  or event or condition which with the giving of notice, the
lapse of time,  or both,  would  constitute  such a default or event of default,
exists with respect to any such Indebtedness.

         (h) Material Contracts.  Schedule 6.1.(h) is, as of the Agreement Date,
a true,  correct and  complete  listing of all Material  Contracts.  Each of the
Borrower,  its  Subsidiaries  and the other Loan  Parties that is a party to any
Material  Contract has performed  and is in compliance  with all of the terms of
such  Material  Contract,  and no  default  or  event  of  default,  or event or
condition  which with the giving of notice,  the lapse of time,  or both,  would
constitute  such a default or event of default,  exists with respect to any such
Material Contract.

         (i) Litigation.  Except as set forth on Schedule 6.1.(i),  there are no
actions,  suits or  proceedings  pending (nor, to the knowledge of the Borrower,
are there any actions, suits or proceedings  threatened,  nor is there any basis
therefor)  against or in any other way relating  adversely  to or affecting  the
Borrower,  any  Subsidiary  or any  other  Loan  Party or any of its  respective
property in any court or before any  arbitrator  of any kind or before or by any
other  Governmental  Authority  which  could  reasonably  be  expected to have a
Material  Adverse Effect.  There are no strikes,  slow downs,  work stoppages or
walkouts or other labor  disputes  in  progress  or  threatened  relating to the
Borrower, any Subsidiary or any other Loan Party.

         (j) Taxes.  All federal,  state and other tax returns of the  Borrower,
any  Subsidiary or any other Loan Party  required by Applicable  Law to be filed
have been duly filed,  and all federal,  state and other taxes,  assessments and
other governmental charges or levies upon the Borrower,  any Subsidiary and each
other Loan Party and its respective properties, income, profits and assets which
are due and payable have been paid,  except any such nonpayment  which is at the
time permitted  under Section 7.6. As of the Agreement  Date, none of the United
States income tax returns of the Borrower,  its  Subsidiaries  or any other Loan
Party is under  audit.  All

                                      -55-
<PAGE>

charges,  accruals  and  reserves on the books of the  Borrower  and each of its
Subsidiaries  in  respect  of any  taxes or other  governmental  charges  are in
accordance with GAAP.

         (k)  Financial  Statements.  The Borrower has  furnished to each Lender
copies of (i) the audited  consolidated  balance  sheet of the  Borrower and its
consolidated  Subsidiaries for the fiscal year ending December 31, 1999, and the
related audited consolidated statements of income, shareholders' equity and cash
flow for the fiscal year ending on such date,  with the opinion thereon of Ernst
& Young LLP, and (ii) the unaudited  consolidated  balance sheet of the Borrower
and its  consolidated  Subsidiaries  for the fiscal quarter ending September 30,
2000, and the related unaudited consolidated  statements of income and cash flow
of the Borrower and its  consolidated  Subsidiaries for the three fiscal quarter
period ending on such date.  Such financial  statements  (including in each case
related  schedules  and notes) are complete and correct and present  fairly,  in
accordance with GAAP consistently  applied throughout the periods involved,  the
consolidated   financial   position  of  the  Borrower   and  its   consolidated
Subsidiaries as at their  respective dates and the results of operations and the
cash flow for such  periods  (subject,  as to  interim  statements,  to  changes
resulting from normal year-end audit adjustments).  Neither the Borrower nor any
of  its  Subsidiaries  has  on  the  Agreement  Date  any  material   contingent
liabilities,   liabilities,   liabilities   for  taxes,   unusual  or  long-term
commitments  or unrealized or forward  anticipated  losses from any  unfavorable
commitments,  except  as  referred  to or  reflected  or  provided  for in  said
financial statements or except as set forth on Schedule 6.1.(k).

         (l) No Material Adverse Change. Since December 31, 1999, there has been
no material adverse change in the consolidated  financial condition,  results of
operations,   business  or  prospects  of  the  Borrower  and  its  consolidated
Subsidiaries  taken as a whole.  Each of the Borrower,  its Subsidiaries and the
other Loan Parties is Solvent.

         (m) ERISA.  Each  member of the ERISA Group is in  compliance  with its
obligations  under the  minimum  funding  standards  of ERISA  and the  Internal
Revenue Code with respect to each Plan and is in  compliance  with the presently
applicable  provisions  of ERISA and the  Internal  Revenue Code with respect to
each Plan, except in each case for noncompliances  which could not reasonably be
expected to have a Material Adverse Effect.  As of the Agreement Date, no member
of the ERISA Group has (i) sought a waiver of the minimum funding standard under
Section 412 of the Internal  Revenue Code in respect of any Plan, (ii) failed to
make any contribution or payment to any Plan or Multiemployer Plan or in respect
of any  Benefit  Arrangement,  or made  any  amendment  to any  Plan or  Benefit
Arrangement,  which has resulted or could result in the  imposition of a Lien or
the posting of a bond or other security under ERISA or the Internal Revenue Code
or (iii)  incurred any liability  under Title IV of ERISA other than a liability
to the PBGC for premiums under Section 4007 of ERISA.

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

                                      -56-
<PAGE>

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

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

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

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

                                      -57-
<PAGE>

         (s)  Affiliate  Transactions.  Except as  permitted  by Section  9.10.,
neither the Borrower,  any  Subsidiary nor any other Loan Party is a party to or
bound by any  agreement or  arrangement  (whether  oral or written) to which any
Affiliate of the Borrower, any Subsidiary or any other Loan Party is a party.

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

         (u)  Business.   As  of  the  Agreement  Date,  the  Borrower  and  its
Subsidiaries are engaged substantially in the business of owning,  operating and
developing office buildings,  together with other business activities incidental
thereto.

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

         (w) Accuracy and Completeness of Information.  No written  information,
report  or other  papers  or data  (excluding  financial  projections  and other
forward looking  statements)  furnished to the Agent or any Lender by, on behalf
of, or at the direction of, the Borrower, any Subsidiary or any other Loan Party
in  connection  with or relating  in any way to this  Agreement,  contained  any
untrue statement of a fact material to the creditworthiness of the Borrower, any
Subsidiary or any other Loan Party or omitted to state a material fact necessary
in  order  to  make  such  statements   contained  therein,   in  light  of  the
circumstances  under  which  they  were  made,  not  misleading.  All  financial
statements  furnished  to the Agent or any  Lender  by, on behalf  of, or at the
direction of, the Borrower, any Subsidiary or any other Loan Party in connection
with or relating in any way to this  Agreement,  present  fairly,  in accordance
with GAAP consistently  applied  throughout the periods involved,  the financial
position  of the  Persons  involved  as at the date  thereof  and the results of
operations for such periods. All financial projections and other forward looking
statements prepared by or on behalf of the Borrower, any Subsidiary or any other
Loan Party that have been or may hereafter be made available to the Agent or any
Lender were or will be prepared in good faith based on  reasonable  assumptions.
No fact is known to the  Borrower  which has had,  or may in the future have (so
far as the Borrower can reasonably

                                      -58-
<PAGE>

foresee),  a  Material  Adverse  Effect  which  has not  been  set  forth in the
financial  statements  referred  to in Section  6.1.(k) or in such  information,
reports or other papers or data or  otherwise  disclosed in writing to the Agent
and the Lenders prior to the Effective Date.

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

         (y) Unencumbered  Assets.  As of the Agreement Date, Part I of Schedule
6.1.(y) is a correct and complete list of all Unencumbered Assets and Part II of
such Schedule is a correct and complete list of all Unencumbered Mortgage Notes.
Each of the Properties  included by the Borrower in calculations of Unencumbered
Asset Value  satisfies all of the  requirements  contained in the  definition of
"Unencumbered  Asset".  Each of the promissory notes included by the Borrower in
calculations  of  Unencumbered  Asset Value  satisfies  all of the  requirements
contained in the definition of "Unencumbered Mortgage Note".

Section 6.2.  Survival of Representations and Warranties, Etc.

         All statements  contained in any  certificate,  financial  statement or
other  instrument  delivered by or on behalf of the Borrower,  any Subsidiary or
any other  Loan Party to the Agent or any Lender  pursuant  to or in  connection
with this  Agreement  or any of the other  Loan  Documents  (including,  but not
limited  to, any such  statement  made in or in  connection  with any  amendment
thereto or any statement  contained in any certificate,  financial  statement or
other  instrument  delivered  by or on  behalf  of  the  Borrower  prior  to the
Agreement  Date and  delivered  to the Agent or any  Lender in  connection  with
closing the transactions  contemplated hereby) shall constitute  representations
and warranties  made by the Borrower under this Agreement.  All  representations
and warranties  made under this Agreement and the other Loan Documents  shall be
deemed to be made at and as of the Agreement  Date,  the Effective  Date and the
date of the  occurrence  of any Credit  Event,  except to the  extent  that such
representations  and warranties  expressly  relate solely to an earlier date (in
which case such representations and warranties shall have been true and accurate
on and as of such earlier date) and except for changes in factual  circumstances
specifically permitted hereunder.  All such representations and warranties shall
survive the  effectiveness of this Agreement,  the execution and delivery of the
Loan  Documents  and the making of the Loans and the  issuance of the Letters of
Credit.

                       ARTICLE VII. AFFIRMATIVE COVENANTS

         For so  long as this  Agreement  is in  effect,  unless  the  Requisite
Lenders (or, if required  pursuant to Section  12.6.,  all of the Lenders) shall
otherwise  consent in the manner  provided  for in Section  12.6.,  the Borrower
shall comply with the following covenants:

Section 7.1.  Preservation of Existence and Similar Matters.

         Except as otherwise  permitted  under Section 9.7.,  the Borrower shall
preserve and maintain,  and cause each  Subsidiary  and each other Loan Party to
preserve and maintain, its respective existence,  rights,  franchises,  licenses
and privileges in the jurisdiction of its

                                      -59-
<PAGE>

incorporation or formation and qualify and remain qualified and authorized to do
business in each  jurisdiction  in which the character of its  properties or the
nature of its business  requires such  qualification and authorization and where
the failure to be so authorized  and qualified  could  reasonably be expected to
have a Material Adverse Effect.

Section 7.2.  Compliance with Applicable Law and Material Contracts.

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

Section 7.3.  Maintenance of Property.

         In addition to the requirements of any of the other Loan Documents, the
Borrower  shall,  and shall cause each  Subsidiary  and other Loan Party to, (a)
protect and preserve all of its material properties,  including, but not limited
to, all Intellectual  Property,  and maintain in good repair,  working order and
condition all tangible properties, ordinary wear and tear excepted, and (b) make
or cause to be made all needed and appropriate repairs,  renewals,  replacements
and additions to such properties,  so that the business carried on in connection
therewith may be properly and advantageously conducted at all times.

Section 7.4.  Conduct of Business.

         The  Borrower  shall at all times carry on, and cause its  Subsidiaries
and the other Loan Parties to carry on, its  respective  businesses as described
in Section 6.1.(u).

Section 7.5.  Insurance.

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

Section 7.6.  Payment of Taxes and Claims.

         The  Borrower  shall,  and shall cause each  Subsidiary  and other Loan
Party to, pay and discharge when due (a) all taxes, assessments and governmental
charges  or levies  imposed  upon it or upon its  income or  profits or upon any
properties belonging to it, and (b) all lawful claims of materialmen, mechanics,
carriers,  warehousemen and landlords for labor, materials, supplies and rentals
which,  if  unpaid,  might  become  a Lien on any  properties  of  such  Person;
provided,  however, that this Section shall not require the payment or discharge
of any such tax,  assessment,  charge, levy or claim which is being contested in
good faith by  appropriate  proceedings  which

                                      -60-
<PAGE>

operate to suspend the collection  thereof and for which adequate  reserves have
been  established  on the books of the Borrower,  such  Subsidiary or such other
Loan Party, as applicable, in accordance with GAAP.

Section 7.7.  Visits and Inspections.

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

Section 7.8.  Use of Proceeds; Letters of Credit.

         The  Borrower  shall use the  proceeds  of all Loans and all Letters of
Credit for general business purposes only. The Borrower shall not, and shall not
permit any  Subsidiary  or other Loan Party to, use any part of such proceeds or
Letters of Credit to purchase or carry,  or to reduce or retire or refinance any
credit  incurred to purchase or carry,  any margin stock  (within the meaning of
Regulation  U of the Board of  Governors  of the Federal  Reserve  System) or to
extend  credit to others for the  purpose of  purchasing  or  carrying  any such
margin stock.

Section 7.9.  Environmental Matters.

         The Borrower  shall,  and shall cause all of its  Subsidiaries  and the
other Loan Parties to, comply with all Environmental Laws the failure with which
to comply could reasonably be expected to have a Material Adverse Effect. If the
Borrower,  any  Subsidiary or any other Loan Party shall (a) receive notice that
any violation of any Environmental Law may have been committed or is about to be
committed by such Person, (b) receive notice that any administrative or judicial
complaint or order has been filed or is about to be filed  against the Borrower,
any Subsidiary or any other Loan Party alleging  violations of any Environmental
Law or requiring  the Borrower,  any  Subsidiary or any other Loan Party to take
any action in connection with the release of Hazardous  Materials or (c) receive
any notice from a  Governmental  Authority or private  party  alleging  that the
Borrower,  any  Subsidiary or any other Loan Party may be liable or  responsible
for costs  associated  with a response  to or cleanup of a release of  Hazardous
Materials or any damages caused  thereby,  and such notices,  individually or in
the aggregate,  could  reasonably be expected to have a Material Adverse Effect,
the Borrower  shall provide the Agent and each Lender with a copy of such notice
within 30 days after the receipt thereof by the

                                      -61-
<PAGE>

Borrower,  any Subsidiary or any other Loan Party. The Borrower shall, and shall
cause its  Subsidiaries and the other Loan Parties to, take promptly all actions
necessary  to prevent  the  imposition  of any Liens on any of their  respective
properties arising out of or related to any Environmental Laws.

Section 7.10.  Books and Records.

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

Section 7.11.  Further Assurances.

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

Section 7.12.  New Subsidiaries/Guarantors.

         (a)  Requirement  to Become  Guarantor.  Within  30 days of any  Person
(other than an Excluded  Subsidiary)  becoming a Material  Subsidiary  after the
Effective  Date,  the Borrower  shall deliver to the Agent each of the following
items,  each in form and substance  satisfactory to the Agent:  (a) an Accession
Agreement executed by such Material Subsidiary and (b) the items that would have
been  delivered  under  Sections  5.1.(a)(iv)  and  (ix)  through  (xii) if such
Material  Subsidiary  had been one on the  Effective  Date;  provided,  however,
promptly (and in any event within 5 Business Days) upon any Excluded  Subsidiary
ceasing to be subject to the  restriction  which prevented it from delivering an
Accession Agreement pursuant to this Section,  such Subsidiary shall comply with
the  provisions of this  Section.  The Agent shall send to each Lender copies of
each of the  foregoing  items  once the Agent has  received  all such items with
respect to a Material Subsidiary.

         (b) Release of a  Guarantor.  The  Borrower may request in writing that
the Agent release,  and upon receipt of such request the Agent shall release,  a
Guarantor from the Guaranty so long as: (i) such Guarantor  meets,  or will meet
simultaneously with its release from the Guaranty,  all of the provisions of the
definition  of  the  term  "Excluded   Subsidiary"  or  has  ceased  to  be,  or
simultaneously  with its release from the Guaranty  will cease to be, a Material
Subsidiary;  (ii) such Guarantor is not otherwise  required to be a party to the
Guaranty under the  immediately  preceding  subsection  (a); (iii) no Default or
Event of Default  shall then be in  existence or would occur as a result of such
release,  including without limitation,  a Default or Event of Default resulting
from a violation of any of the covenants contained in Section 9.1.; and (iv) the
Agent shall have received  such written  request at least 10 Business Days prior
to the requested  date of release.  Delivery by the Borrower to the Agent of any
such request shall constitute a representation  by the Borrower that the matters
set forth in the preceding  sentence  (both as of the date of the giving of such
request and as of the date of the  effectiveness  of such  request) are true and
correct with respect to such request.

                                      -62-
<PAGE>

Section 7.13.  REIT Status.

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

Section 7.14.  Exchange Listing.

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

                            ARTICLE VIII. INFORMATION

         For so  long as this  Agreement  is in  effect,  unless  the  Requisite
Lenders (or, if required  pursuant to Section  12.6.,  all of the Lenders) shall
otherwise  consent in the manner set forth in Section 12.6.,  the Borrower shall
furnish to each  Lender (or to the Agent if so  provided  below) at its  Lending
Office:

Section 8.1.  Quarterly Financial Statements.

         As soon as available and in any event within 45 days after the close of
each of the  first,  second  and third  fiscal  quarters  of the  Borrower,  the
unaudited  consolidated balance sheet of the Borrower and its Subsidiaries as at
the end of such  period and the related  unaudited  consolidated  statements  of
income, shareholders' equity and cash flows of the Borrower and its Subsidiaries
for such period,  setting forth in each case in comparative  form the figures as
of the end of and for the corresponding periods of the previous fiscal year, all
of which shall be certified by the chief financial  officer of the Borrower,  in
his or her opinion, to present fairly, in accordance with GAAP, the consolidated
financial  position of the Borrower and its  Subsidiaries as at the date thereof
and the results of operations for such period  (subject to normal year-end audit
adjustments).  Together  with such  financial  statements,  the  Borrower  shall
deliver reports, in form and detail satisfactory to the Agent, setting forth (a)
a statement of Funds From Operations for the fiscal quarter then ending; (b) all
capital   expenditures  made  during  the  fiscal  quarter  then  ended;  (c)  a
description of all Properties acquired during such fiscal quarter, including the
net  operating  income  of each such  Property,  acquisition  costs and  related
mortgage debt and such other information as the Agent may request.

Section 8.2.  Year-End Statements.

         Within 90 days after the end of each fiscal year of the  Borrower,  the
audited  consolidated  balance sheet of the Borrower and its  Subsidiaries as at
the end of such fiscal year and the related audited  consolidated  statements of
income, shareholders' equity and cash flows of the Borrower and its Subsidiaries
for such fiscal year,  setting forth in  comparative  form the figures as at the
end of and for the previous  fiscal year, all of which shall be certified by (a)
the chief financial officer of the Borrower,  in his or her opinion,  to present
fairly,  in accordance  with GAAP, the  consolidated  financial  position of the
Borrower  and  its  Subsidiaries  as at the  date  thereof  and the

                                      -63-
<PAGE>

results of  operations  for such  period and (b)  independent  certified  public
accountants  of recognized  national  standing  acceptable  to the Agent,  whose
certificate shall be unqualified and in scope and substance  satisfactory to the
Requisite  Lenders and who shall have  authorized  the  Borrower to deliver such
financial  statements  and  certification  thereof to the Agent and the  Lenders
pursuant  to this  Agreement.  Together  with  such  financial  statements,  the
Borrower shall deliver a report,  in form and detail  satisfactory to the Agent,
setting forth the Net Operating Income for each Property for such fiscal year.

Section 8.3.  Compliance Certificate.

         At the time  financial  statements  are furnished  pursuant to Sections
8.1. and 8.2., and within 5 Business Days of the Agent's request with respect to
any other fiscal period, a certificate substantially in the form of Exhibit O (a
"Compliance  Certificate")  executed  by  the  chief  financial  officer  of the
Borrower: (a) setting forth in reasonable detail as at the end of such quarterly
accounting period,  fiscal year, or other fiscal period, as the case may be, the
calculations required to establish whether or not the Borrower was in compliance
with the  covenants  contained in Sections 9.1.  through 9.3. and 9.6.,  and (b)
stating that, to the best of his or her knowledge,  information and belief after
due inquiry, no Default or Event of Default exists, or, if such is not the case,
specifying  such  Default or Event of Default and its nature,  when it occurred,
whether it is continuing  and the steps being taken by the Borrower with respect
to such event, condition or failure.

Section 8.4.  Other Information.

         (a) Management  Reports.  Promptly upon receipt thereof,  copies of all
management  reports,  if any, submitted to the Borrower or its Board of Trustees
by its independent public accountants including;

         (b) Securities  Filings.  Within 5 Business Days of the filing thereof,
copies of all  registration  statements  (excluding the exhibits thereto (unless
requested  by the  Agent)  and any  registration  statements  on Form S-8 or its
equivalent),  reports on Forms 10-K, 10-Q and 8-K (or their equivalents) and all
other  periodic  reports  which the Borrower,  any  Subsidiary or any other Loan
Party  shall  file  with  the  Securities   and  Exchange   Commission  (or  any
Governmental   Authority   substituted  therefor)  or  any  national  securities
exchange;

         (c) Shareholder  Information.  Promptly upon the mailing thereof to the
shareholders  of the Borrower  generally,  copies of all  financial  statements,
reports and proxy  statements so mailed and promptly  upon the issuance  thereof
copies of all press releases issued by the Borrower, any Subsidiary or any other
Loan Party;

         (d) ERISA.  If and when any  member of the ERISA  Group (i) gives or is
required  to give  notice to the PBGC of any  "reportable  event" (as defined in
Section 4043 of ERISA) with respect to any Plan which might  constitute  grounds
for a termination  of such Plan under Title IV of ERISA,  or knows that the plan
administrator  of any Plan has given or is  required  to give notice of any such
reportable  event,  a copy of the  notice  of such  reportable  event  given  or
required to be given to the PBGC;  (ii)  receives  notice of complete or partial
withdrawal  liability  under Title IV of ERISA or notice that any  Multiemployer
Plan is in reorganization,  is insolvent

                                      -64-
<PAGE>

or has been  terminated,  a copy of such notice;  (iii) receives notice from the
PBGC under Title IV of ERISA of an intent to terminate,  impose liability (other
than for  premiums  under  Section  4007 of ERISA) in  respect  of, or appoint a
trustee to administer any Plan, a copy of such notice; (iv) applies for a waiver
of the minimum funding  standard under Section 412 of the Internal Revenue Code,
a copy of such  application;  (v) gives notice of intent to  terminate  any Plan
under  Section  4041(c) of ERISA,  a copy of such  notice and other  information
filed with the PBGC;  (vi) gives notice of withdrawal  from any Plan pursuant to
Section 4063 of ERISA, a copy of such notice; or (vii) fails to make any payment
or contribution to any Plan or  Multiemployer  Plan or in respect of any Benefit
Arrangement or makes any amendment to any Plan or Benefit  Arrangement which has
resulted or could result in the imposition of a Lien or the posting of a bond or
other  security,  a certificate of the chief  financial  officer of the Borrower
setting forth details as to such  occurrence  and the action,  if any, which the
Borrower  or  applicable  member of the ERISA  Group is  required or proposes to
take;

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

         (f) Modification of Organizational  Documents.  A copy of any amendment
to the articles of incorporation, bylaws, partnership agreement or other similar
organizational  documents of the Borrower or any other Loan Party promptly upon,
and in any event within 15 Business Days of, the effectiveness thereof;

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

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

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

                                      -65-
<PAGE>

         (j) Notice of  Violations of Law.  Prompt  notice if the Borrower,  any
Subsidiary  or any other Loan Party  shall  receive  any  notification  from any
Governmental Authority alleging a violation of any Applicable Law or any inquiry
which could reasonably be expected to have a Material Adverse Effect;

         (k)  Material  Subsidiary.  Prompt  notice  of any  Person  becoming  a
Material Subsidiary;

         (l) Material Asset Sales.  Prompt notice of the sale, transfer or other
disposition of any material assets of the Borrower,  any Subsidiary or any other
Loan Party to any Person other than the  Borrower,  any  Subsidiary or any other
Loan Party;

         (m)  Material  Contracts.  Promptly  upon  entering  into any  Material
Contract  after  the  Agreement  Date,  a copy to the  Agent  of  such  Material
Contract; and

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

                         ARTICLE IX. NEGATIVE COVENANTS

         For so  long as this  Agreement  is in  effect,  unless  the  Requisite
Lenders (or, if required  pursuant to Section  12.6.,  all of the Lenders) shall
otherwise  consent in the manner set forth in Section 12.6.,  the Borrower shall
comply with the following covenants:

Section 9.1.  Financial Covenants.

         The Borrower shall not permit:

         (a) Leverage Ratio.  The ratio of (i) Total  Indebtedness to (ii) Total
Asset Value, to exceed 0.550 to 1.0 at any time.

         (b) Interest  Coverage  Ratio.  The ratio of (i) EBITDA of the Borrower
and its Subsidiaries  determined on a consolidated  basis for the fiscal quarter
of the Borrower  most recently  ending to (ii) Interest  Expense of the Borrower
and its Subsidiaries  determined on a consolidated  basis for such period, to be
less than 2.0 to 1.0 at any time.

         (c) Minimum  Fixed  Charge  Coverage  Ratio.  The ratio of (i) Adjusted
EBITDA for the fiscal quarter of the Borrower most recently ending to (ii) Fixed
Charges for such period, to be less than 1.750 to 1.00 at any time.

         (d) Secured  Indebtedness.  The ratio of (i)(x) Secured Indebtedness of
the Borrower and its  Subsidiaries  to (y) Total Asset Value, to be greater than
0.30  to  1.00  at any  time;  and  (ii)(x)  Secured  Indebtedness  (other  than
Nonrecourse  Indebtedness)  of the  Borrower and its  Subsidiaries  to (y) Total
Asset Value, to be greater than 0.15 to 1.00 at any time.

                                      -66-
<PAGE>

         (e) Unencumbered  Leverage Ratio.  The ratio of (i) Unencumbered  Asset
Value to (ii) Unsecured Indebtedness, to be less than 1.750 to 1.00 at any time.

         (f) Unencumbered Interest Coverage Ratio. The ratio of (i) Unencumbered
Net Operating  Income to (ii) Unsecured  Debt Service for the Borrower's  fiscal
quarter most recently ending, to be less than 2.0 to 1.0 at any
time.

         (g) Minimum  Tangible  Net Worth.  Tangible Net Worth at any time to be
less than (i)  $1,150,000,000  plus (ii) 75% of the Net  Proceeds  of all Equity
Issuances  effected by the Borrower or any Subsidiary (other Equity Issuances to
the Borrower or any Subsidiary) after the Agreement Date.

         (h)  Floating  Rate  Debt.  The  aggregate   principal  amount  of  all
outstanding Floating Rate Debt to exceed $600,000,000 at any time.

         (i) Total Assets Owned by Borrower and Guarantors.  The amount of Total
Asset Value  directly  owned by the Borrower and the  Guarantors to be less than
95.0% of Total Asset Value  (excluding the amount of Total Asset Value,  if any,
then attributable to Excluded Subsidiaries).

Section 9.2.  Indebtedness.

         The  Borrower  shall not,  and shall not permit any  Subsidiary  or any
other Loan Party to, create,  incur,  assume,  or permit or suffer to exist, any
Indebtedness other than the following:

         (a) the Obligations;

         (b) Indebtedness set forth on Schedule 6.1.(g);

         (c) intercompany  Indebtedness  among the Borrower and its Wholly Owned
Subsidiaries;  provided,  however, that the obligations of the Borrower and each
Guarantor in respect of such intercompany  Indebtedness  shall be subordinate to
the Obligations; and

         (d) any  other  Indebtedness  of a type  not  described  above  in this
Section and created,  incurred or assumed  after the  Agreement  Date so long as
immediately  prior  to  the  creation,  incurring  or  assumption  thereof,  and
immediately  thereafter and after giving effect thereto,  no Default or Event of
Default is or would be in existence,  including without limitation, a Default or
Event of Default resulting from a violation of any of the covenants contained in
Section 9.1.

Section 9.3. Certain Permitted Investments.

         The  Borrower  shall not,  and shall not permit any  Subsidiary  or any
other Loan Party to, make any Investment in or otherwise own the following items
which would cause the aggregate  value of such holdings of the Borrower and such
other Subsidiaries to exceed the applicable limits set forth below at such time:

                                      -67-
<PAGE>

                  (a)   Investments  in  Persons  which  are  not   Subsidiaries
         (including  ownership  of  Indebtedness  secured by real  property  but
         excluding the  Borrower's  Investments  in SNH and HPT),  such that the
         aggregate book value of such  Investments  exceeds 25.0% of Total Asset
         Value at any time;

                  (b) Developable  Property,  such that the aggregate book value
         of all such  Developable  Property exceeds 7.5% of Total Asset Value at
         any time;

                  (c)  Assets  Under   Development   such  that  the   aggregate
         Construction Budget for all such Assets Under Development exceeds 15.0%
         of Total Asset Value at any time. For purposes of this subsection,  (i)
         "Construction   Budget"   means  the   fully-budgeted   costs  for  the
         acquisition  and  construction  of  a  given  piece  of  real  property
         (including without limitation, the cost of acquiring such piece of real
         property  (except  to the  extent any  portion  thereof is  Developable
         Property  included  in  the  immediately   preceding  subsection  (b)),
         reserves for  construction  interest  and  operating  deficits,  tenant
         improvements,   leasing  commissions,   and  infrastructure  costs)  as
         reasonably  determined  by the  Borrower  in good  faith  and (ii) real
         property  under  construction  to be  (but  not  yet)  acquired  by the
         Borrower or a Subsidiary upon completion of construction  pursuant to a
         contract  in which the  seller of such real  property  is  required  to
         complete  construction prior to, and as a condition  precedent to, such
         acquisition, shall be subject to this subsection; and

                  (d) Investments in "taxable REIT  subsidiaries" (as defined in
         Section 856(l) of the Internal  Revenue Code),  such that the aggregate
         book value of such Investments  exceeds 20% of Total Asset Value at any
         time.

In addition to the  foregoing  limitations,  the  aggregate  value of all of the
items subject to the limitations in the preceding clauses (a), (b) and (d) shall
not exceed 25.0% of Total Asset Value at any time.

Section 9.4.  Investments Generally.

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

         (a)  Investments in Subsidiaries in existence on the Agreement Date and
disclosed on Part I of Schedule 6.1.(b);

         (b)  Investments  to acquire  Equity  Interests of a Subsidiary  or any
other Person who after giving effect to such acquisition  would be a Subsidiary,
so long as in each  case (i)  immediately  prior to such  Investment,  and after
giving  effect  thereto,  no  Default  or  Event  of  Default  is or would be in
existence  and  (ii) if such  Subsidiary  is (or  after  giving  effect  to such
Investment  would become) a Material  Subsidiary,  the terms and  conditions set
forth in Section 7.12. are satisfied;

         (c) Investments permitted under Section 9.3.;

                                      -68-
<PAGE>

         (d) Investments in Cash Equivalents;

         (e) intercompany  Indebtedness  among the Borrower and its Wholly Owned
Subsidiaries  provided  that  such  Indebtedness  is  permitted  by the terms of
Section 9.2.;

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

         (g) any other  Investment so long as  immediately  prior to making such
Investment,  and  immediately  thereafter  and after giving effect  thereto,  no
Default  or Event of  Default  is or would be in  existence,  including  without
limitation,  a Default or Event of Default resulting from a violation of Section
7.4.

Notwithstanding the foregoing,  the Borrower shall not, and shall not permit any
Subsidiary to, directly or indirectly,  acquire, make or purchase any Investment
that is an Equity  Interest in HPT or SNH, or permit any such  Investment  to be
outstanding  on and after the Agreement  Date,  other than the  Investments  set
forth on Schedule 9.4.

Section 9.5.  Liens; Negative Pledges; Other Matters.

         (a) The  Borrower  shall not,  and shall not permit any  Subsidiary  or
other Loan Party to,  create,  assume,  or incur any Lien (other than  Permitted
Liens) upon any of its  properties,  assets,  income or profits of any character
whether now owned or hereafter  acquired if  immediately  prior to the creation,
assumption or incurring of such Lien, or  immediately  thereafter,  a Default or
Event of Default is or would be in existence,  including without  limitation,  a
Default or Event of Default  resulting  from a violation of any of the covenants
contained in Section 9.1.;

         (b) The  Borrower  shall not,  and shall not permit any  Subsidiary  or
other Loan Party to,  enter into,  assume or  otherwise be bound by any Negative
Pledge except for a Negative  Pledge  contained in any agreement (i)  evidencing
Indebtedness which the Borrower or such Subsidiary may create, incur, assume, or
permit or suffer to exist under Section 9.2.; (ii) which Indebtedness is secured
by a Lien permitted to exist and (iii) which prohibits the creation of any other
Lien on only  the  property  securing  such  Indebtedness  as of the  date  such
agreement was entered into;

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

                                      -69-
<PAGE>

Section 9.6.  Restricted Payments.

         The Borrower  shall not, and shall not permit any  Subsidiary  or other
Loan Party to, declare or make any Restricted Payment; provided, however, that:

         (a)  the  Borrower  may  declare  or  make  cash  distributions  to its
shareholders  during any fiscal  year in an  aggregate  amount not to exceed the
greater of (i) 90.0% of Funds From  Operations  of the  Borrower for such fiscal
year or (ii) the amount for the  Borrower to remain in  compliance  with Section
7.13.;

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

         (c) the  Borrower  may make cash  payments  to  repurchase  outstanding
shares of any of its  Preferred  Stock,  common  stock or other  similar  common
Equity Interests;

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

         (e)  the  Borrower  may  distribute  any  extraordinary   distributions
received by the Borrower in respect of its Investments in SNH and HPT.

Notwithstanding  the  foregoing,  but subject to the  following  sentence,  if a
Default or Event of Default shall have occurred and be continuing,  the Borrower
may only  declare  or make cash  distributions  to its  shareholders  during any
fiscal year in an aggregate  amount not to exceed the minimum  amount  necessary
for the  Borrower to remain in  compliance  with Section  7.13.  If a Default or
Event of Default  specified  in Section  10.1.(a),  Section  10.1.(f) or Section
10.1.(g)  shall  have  occurred  and be  continuing,  or if as a  result  of the
occurrence of any other Event of Default the Obligations  have been  accelerated
pursuant to Section  10.2.(a),  the Borrower shall not, and shall not permit any
Subsidiary  or other Loan Party to, make any  Restricted  Payments to any Person
whatsoever other than to the Borrower or any Subsidiary.

Section 9.7.  Merger, Consolidation, Sales of Assets and Other Arrangements.

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

         (a) any of the actions  described in the immediately  preceding clauses
(i) through (iii) may be taken with respect to any  Subsidiary or any other Loan
Party (other than the  Borrower) so long as  immediately  prior to the taking of
such action,  and  immediately  thereafter and after giving effect  thereto,  no
Default or Event of Default is or would be in existence;

                                      -70-
<PAGE>

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

         (c) a Person  may merge with and into the  Borrower  so long as (i) the
Borrower is the survivor of such merger,  (ii) immediately prior to such merger,
and immediately  thereafter and after giving effect thereto, no Default or Event
of Default is or would be in existence;  and (iii) the Borrower shall have given
the Agent and the Lenders at least 10 Business  Days'  prior  written  notice of
such merger  (except that such prior notice shall not be required in the case of
the merger of a Subsidiary with and into the Borrower); and

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

Section 9.8.  Fiscal Year.

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

Section 9.9.  Modifications to Advisory Agreement and Other Material Contracts.

         The  Borrower  shall  not  default  in  any  material  respect  in  the
performance  of any of its  obligations  under  the  Advisory  Agreement  or the
Management  Agreement  or  permit  the  Advisory  Agreement  or  the  Management
Agreement  to be  canceled  or  terminated  prior to its  stated  maturity.  The
Borrower shall not enter into any amendment,  modification  or waiver of or with
respect  to  any of  the  terms  of the  Advisory  Agreement  or the  Management
Agreement,  except for extensions  thereof.  With respect to Material  Contracts
other than the Advisory  Agreement and the  Management  Agreement,  the Borrower
shall not,  and shall not permit any  Subsidiary  or other Loan Party to,  enter
into any amendment or  modification  to any such Material  Contract  which could
reasonably be expected to have a Material Adverse Effect.

Section 9.10.  Transactions with Affiliates.

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

Section 9.11.  ERISA Exemptions.

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

                                      -71-
<PAGE>

                               ARTICLE X. DEFAULT

Section 10.1.  Events of Default.

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

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

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

         (c) Default in  Performance.  (i) The Borrower shall fail to perform or
observe any term, covenant,  condition or agreement contained in Section 8.4.(h)
or in Article  IX. or (ii) the  Borrower  or any other Loan Party  shall fail to
perform or observe any term, covenant,  condition or agreement contained in this
Agreement  or any other Loan  Document to which it is a party and not  otherwise
mentioned  in this Section and such  failure  shall  continue for a period of 30
days after the earlier of (x) the date upon which a  Responsible  Officer of the
Borrower or such Loan Party  obtains  knowledge  of such failure or (y) the date
upon which the  Borrower has  received  written  notice of such failure from the
Agent.

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

         (e) Indebtedness Cross-Default.

                  (i) The Borrower, any Subsidiary or any other Loan Party shall
         fail to pay when due and payable the  principal of, or interest on, any
         Indebtedness  or  Subordinated  Debt  (other than (A) the Loans and (B)
         Nonrecourse  Indebtedness of Excluded Subsidiaries) having an aggregate
         outstanding   principal   amount  of  $10,000,000  or  more  ("Material
         Indebtedness")  or any Excluded  Subsidiary  shall fail to pay when due
         and payable the principal of, or interest on, Nonrecourse  Indebtedness
         having an aggregate  outstanding  principal  amount of  $75,000,000  or
         more; or

                  (ii) (x) The maturity of any Material  Indebtedness shall have
         been  accelerated  in accordance  with the provisions of any indenture,
         contract or  instrument  evidencing,

                                      -72-
<PAGE>

         providing  for the creation of or otherwise  concerning  such  Material
         Indebtedness or (y) any Material  Indebtedness shall have been required
         to be prepaid or repurchased prior to the stated maturity thereof; or

                  (iii) any other event shall have  occurred  and be  continuing
         which,  with or without the passage of time,  the giving of notice,  or
         both, would permit any holder or holders of Material Indebtedness,  any
         trustee  or agent  acting on behalf of such  holder or  holders  or any
         other  Person,   to  accelerate  the  maturity  of  any  such  Material
         Indebtedness or require any such Material Indebtedness to be prepaid or
         repurchased prior to its stated maturity.

         (f) Voluntary Bankruptcy Proceeding. The Borrower, any other Loan Party
or any Subsidiary  (other than (x) an Excluded  Subsidiary all  Indebtedness  of
which is Nonrecourse  Indebtedness or (y) a Subsidiary  that,  together with all
other  Subsidiaries then subject to a bankruptcy  proceeding or other proceeding
or  condition  described  in  this  subsection  or  the  immediately   following
subsection,  does not account for more than  $10,000,000  of Total Asset  Value)
shall:  (i)  commence a voluntary  case under the  Bankruptcy  Code of 1978,  as
amended, or other federal bankruptcy laws (as now or hereafter in effect);  (ii)
file a petition seeking to take advantage of any other Applicable Laws, domestic
or foreign, relating to bankruptcy, insolvency,  reorganization,  winding-up, or
composition  or adjustment  of debts;  (iii) consent to, or fail to contest in a
timely and appropriate  manner,  any petition filed against it in an involuntary
case  under  such  bankruptcy  laws or other  Applicable  Laws or consent to any
proceeding or action  described in the immediately  following  subsection;  (iv)
apply for or consent to, or fail to contest in a timely and appropriate  manner,
the  appointment  of, or the taking of  possession  by, a  receiver,  custodian,
trustee,  or  liquidator  of itself or of a  substantial  part of its  property,
domestic or foreign; (v) admit in writing its inability to pay its debts as they
become due; (vi) make a general  assignment for the benefit of creditors;  (vii)
make a conveyance fraudulent as to creditors under any Applicable Law; or (viii)
take any corporate or partnership action for the purpose of effecting any of the
foregoing.

         (g) Involuntary Bankruptcy Proceeding. A case or other proceeding shall
be commenced against the Borrower, any other Loan Party or any Subsidiary (other
than (x) an  Excluded  Subsidiary  all  Indebtedness  of  which  is  Nonrecourse
Indebtedness or (y) a Subsidiary that, together with all other Subsidiaries then
subject to a bankruptcy proceeding or other proceeding or condition described in
this subsection or the immediately  preceding  subsection,  does not account for
more than  $10,000,000  of Total Asset  Value) or any other Loan  Party,  in any
court of competent jurisdiction seeking: (i) relief under the Bankruptcy Code of
1978,  as amended,  or other  federal  bankruptcy  laws (as now or  hereafter in
effect) or under any other  Applicable  Laws,  domestic or foreign,  relating to
bankruptcy, insolvency, reorganization, winding-up, or composition or adjustment
of debts; or (ii) the appointment of a trustee, receiver, custodian,  liquidator
or the like of such  Person,  or of all or any  substantial  part of the assets,
domestic or foreign,  of such Person, and such case or proceeding shall continue
undismissed  or unstayed for a period of 60  consecutive  calendar  days,  or an
order  granting the remedy or other relief  requested in such case or proceeding
against the Borrower,  such Subsidiary or such other Loan Party (including,  but
not limited  to, an order for relief  under such  Bankruptcy  Code or such other
federal bankruptcy laws) shall be entered.

                                      -73-
<PAGE>

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

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

         (j)  Attachment.  A warrant,  writ of attachment,  execution or similar
process shall be issued against any property of the Borrower,  any Subsidiary or
any other Loan Party which exceeds, individually or together with all other such
warrants,  writs,  executions  and  processes,  $10,000,000  in amount  and such
warrant, writ, execution or process shall not be discharged,  vacated, stayed or
bonded  for a period  of 30  days;  provided,  however,  that if a bond has been
issued in favor of the claimant or other Person  obtaining  such warrant,  writ,
execution  or  process,  the  issuer  of such  bond  shall  execute  a waiver or
subordination agreement in form and substance satisfactory to the Agent pursuant
to which  the  issuer  of such bond  subordinates  its  right of  reimbursement,
contribution or subrogation to the  Obligations  and waives or subordinates  any
Lien it may have on the assets of any Loan Party.

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

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

                                      -74-
<PAGE>

         (m) Change of Control.

                  (i) any  "person"  or  "group"  (as  such  terms  are  used in
         Sections  13(d) and 14(d) of the  Securities  Exchange Act of 1934,  as
         amended (the "Exchange Act")) is or becomes the "beneficial  owner" (as
         defined in Rules 13d-3 and 13d-5 under the Exchange Act,  except that a
         Person will be deemed to have "beneficial  ownership" of all securities
         that  such  Person  has the right to  acquire,  whether  such  right is
         exercisable immediately or only after the passage of time), directly or
         indirectly,  of more  than 15% of the  total  voting  power of the then
         outstanding voting stock of the Borrower; or

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

                  (iii) at least 750,000 shares of the outstanding  common stock
         of  the  Borrower  (such  number  to  be  adjusted  for  any  division,
         reclassification, stock dividend and any other similar dilutive events)
         shall in the aggregate cease to be owned  beneficially and of record by
         (A) Barry M.  Portnoy or Gerard M. Martin;  (B) any of their  immediate
         family  members  consisting  of their  respective  spouses  and  lineal
         descendants  (whether  natural or adopted),  and (C) any  corporations,
         limited liability  companies,  trusts or other legal entities which are
         beneficially owned solely by any of the foregoing;

                  (iv)  RMR  shall  cease  for  any  reason  to act as the  sole
         investment advisor to the Borrower; or

                  (v) any three of Barry M. Portnoy,  Gerard M. Martin,  John C.
         Popeo,  John A.  Mannix,  David M.  Lepore or  Jennifer  B. Clark (or a
         substitute elected by the directors or trustees of RMR or the Borrower,
         as the  case  may be,  and  which  is  reasonably  satisfactory  to the
         Requisite  Lenders)  shall  cease to serve as an  officer,  director or
         trustee  of  RMR or the  Borrower  in a  position,  in the  case  of an
         officer,  of equal or greater seniority to the respective  offices each
         holds with RMR or the Borrower,  as the case may be as of the Agreement
         Date.

Section 10.2.  Remedies Upon Event of Default.

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

         (a) Acceleration; Termination of Facilities.

                  (i)  Automatic.  Upon the  occurrence  of an Event of  Default
         specified in Sections  10.1.(f) or 10.1.(g),  (A)(i) the  principal of,
         and all  accrued  interest  on,  the  Loans  and the  Notes at the time
         outstanding,  (ii) an amount equal to the Stated  Amount of all

                                      -75-
<PAGE>

         Letters of Credit  outstanding as of the date of the occurrence of such
         Event  of  Default  and  (iii)  all of  the  other  Obligations  of the
         Borrower,  including, but not limited to, the other amounts owed to the
         Lenders,  the Swingline Lender and the Agent under this Agreement,  the
         Notes or any of the other Loan Documents  shall become  immediately and
         automatically  due and  payable by the  Borrower  without  presentment,
         demand,  protest,  or  other  notice  of any  kind,  all of  which  are
         expressly  waived by the Borrower and (B) all of the  Commitments,  the
         obligation  of the  Lenders  to make  Revolving  Loans,  the  Swingline
         Commitment,  the  obligation of the Swingline  Lender to make Swingline
         Loans,  and the  obligation  of the  Agent to issue  Letters  of Credit
         hereunder, shall all immediately and automatically terminate.

                  (ii)  Optional.  If any  other  Event of  Default  shall  have
         occurred and be  continuing,  the Agent shall,  at the direction of the
         Requisite  Lenders:  (A)  declare  (1) the  principal  of, and  accrued
         interest  on, the Loans and the Notes at the time  outstanding,  (2) an
         amount equal to the Stated Amount of all Letters of Credit  outstanding
         as of the date of the occurrence of such other Event of Default and (3)
         all of the other Obligations,  including, but not limited to, the other
         amounts  owed to the Lenders and the Agent  under this  Agreement,  the
         Notes  or any of the  other  Loan  Documents  to be  forthwith  due and
         payable,  whereupon the same shall  immediately  become due and payable
         without presentment,  demand,  protest or other notice of any kind, all
         of which are  expressly  waived by the Borrower and (B)  terminate  the
         Commitments  and the obligation of the Lenders to make Loans  hereunder
         and the  obligation of the Agent to issue Letters of Credit  hereunder.
         Further,  if the Agent has exercised any of the rights  provided  under
         the preceding  sentence,  the Swingline  Lender shall:  (x) declare the
         principal  of, and accrued  interest  on, the  Swingline  Loans and the
         Swingline  Note  at  the  time  outstanding,   and  all  of  the  other
         Obligations  owing to the  Swingline  Lender,  to be forthwith  due and
         payable,  whereupon the same shall  immediately  become due and payable
         without presentment,  demand,  protest or other notice of any kind, all
         of which are  expressly  waived by the Borrower and (y)  terminate  the
         Swingline Commitment and the obligation of the Swingline Lender to make
         Swingline Loans.

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

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

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

                                      -76-
<PAGE>

Section 10.3.  Remedies Upon Default.

         Upon the  occurrence  of a Default  specified  in Sections  10.1.(f) or
10.1.(g), the Commitments shall immediately and automatically terminate.

Section 10.4.  Allocation of Proceeds.

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

                  (a)  amounts  due to the Agent and the  Lenders  in respect of
         fees and expenses due under Section 12.2.;

                  (b) payments of interest on Swingline Loans;

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

                  (d) payments of principal of Swingline Loans;

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

                  (f) amounts to be  deposited  into the  Collateral  Account in
         respect of Letters of Credit;

                  (g) amounts due the Agent and the Lenders pursuant to Sections
         11.7. and 12.9.;

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

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

Section 10.5.  Collateral Account.

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

                                      -77-
<PAGE>

Agreement to the contrary notwithstanding,  funds held in the Collateral Account
shall be subject to  withdrawal  only as provided in this Section and in Section
2.14.

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

         (c) If an Event of Default shall have occurred and be  continuing,  the
Requisite Lenders may, in their  discretion,  at any time and from time to time,
instruct the Agent to  liquidate  any such  investments  and  reinvestments  and
credit the proceeds  thereof to the Collateral  Account and apply or cause to be
applied such proceeds and any other  balances in the  Collateral  Account to the
payment of any of the Letter of Credit Liabilities due and payable.

         (d)  If (i)  no  Default  or  Event  of  Default  has  occurred  and is
continuing  and (ii) all of the Letter of Credit  Liabilities  have been paid in
full,  the Agent  shall,  from time to time,  at the  request  of the  Borrower,
deliver to the Borrower,  against receipt but without any recourse,  warranty or
representation  whatsoever,  such of the balances in the  Collateral  Account as
exceed the aggregate amount of Letter of Credit Liabilities at such time.

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

Section 10.6.  Performance by Agent.

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

Section 10.7.  Rights Cumulative.

         The  rights  and  remedies  of the Agent  and the  Lenders  under  this
Agreement  and each of the other  Loan  Documents  shall be  cumulative  and not
exclusive of any rights or remedies  which any of them may otherwise  have under
Applicable Law. In exercising their respective rights and remedies the Agent and
the Lenders may be selective  and no failure or delay by the Agent or any

                                      -78-
<PAGE>

of the  Lenders in  exercising  any right  shall  operate as a waiver of it, nor
shall any single or partial exercise of any power or right preclude its other or
further exercise or the exercise of any other power or right.

                              ARTICLE XI. THE AGENT

Section 11.1.  Authorization and Action.

         Each  Lender  hereby  appoints  and  authorizes  the Agent to take such
action as  contractual  representative  on such Lender's  behalf and to exercise
such  powers  under  this   Agreement  and  the  other  Loan  Documents  as  are
specifically  delegated to the Agent by the terms  hereof and thereof,  together
with such powers as are reasonably  incidental thereto. Not in limitation of the
foregoing,  each Lender  authorizes and directs the Agent to enter into the Loan
Documents for the benefit of the Lenders. Each Lender hereby agrees that, except
as otherwise  set forth  herein,  any action taken by the  Requisite  Lenders in
accordance with the provisions of this Agreement or the Loan Documents,  and the
exercise  by the  Requisite  Lenders of the powers set forth  herein or therein,
together with such other powers as are reasonably  incidental thereto,  shall be
authorized  and  binding  upon  all of the  Lenders.  Nothing  herein  shall  be
construed to deem the Agent a trustee or fiduciary  for any Lender nor to impose
on the Agent  duties or  obligations  other than those  expressly  provided  for
herein. At the request of a Lender, the Agent will forward to such Lender copies
or,  where  appropriate,  originals  of the  documents  delivered  to the  Agent
pursuant  to this  Agreement  or the other Loan  Documents.  The Agent will also
furnish  to any  Lender,  upon  the  request  of  such  Lender,  a  copy  of any
certificate or notice furnished to the Agent by the Borrower,  any Loan Party or
any other  Affiliate of the  Borrower,  pursuant to this  Agreement or any other
Loan Document not already delivered to such Lender pursuant to the terms of this
Agreement  or any such other Loan  Document.  As to any  matters  not  expressly
provided for by the Loan Documents (including,  without limitation,  enforcement
or  collection  of any of the  Obligations),  the Agent shall not be required to
exercise any  discretion or take any action,  but shall be required to act or to
refrain  from acting (and shall be fully  protected  in so acting or  refraining
from  acting)  upon the  instructions  of the  Requisite  Lenders (or all of the
Lenders if explicitly required under any other provision of this Agreement), and
such  instructions  shall be binding  upon all Lenders and all holders of any of
the  Obligations;  provided,  however,  that,  notwithstanding  anything in this
Agreement  to the  contrary,  the Agent shall not be required to take any action
which  exposes  the Agent to  personal  liability  or which is  contrary to this
Agreement or any other Loan Document or Applicable Law. Not in limitation of the
foregoing,  the Agent shall not  exercise  any right or remedy it or the Lenders
may have under any Loan Document upon the occurrence of a Default or an Event of
Default unless the Requisite Lenders have so directed the Agent to exercise such
right or remedy.

Section 11.2.  Agent's Reliance, Etc.

         Notwithstanding  any other  provisions  of this  Agreement or any other
Loan Documents,  neither the Agent nor any of its directors,  officers,  agents,
employees or counsel shall be liable for any action taken or omitted to be taken
by it or them  under or in  connection  with this  Agreement,  except for its or
their  own  gross  negligence  or  willful  misconduct.   Without  limiting  the
generality of the foregoing,  the Agent:  (a) may treat the payee of any Note as
the holder

                                      -79-
<PAGE>

thereof until the Agent  receives  written  notice of the assignment or transfer
thereof  signed by such payee and in form  satisfactory  to the  Agent;  (b) may
consult  with legal  counsel  (including  its own  counsel  or  counsel  for the
Borrower or any other Loan  Party),  independent  public  accountants  and other
experts  selected by it and shall not be liable for any action  taken or omitted
to be taken in good faith by it in  accordance  with the advice of such counsel,
accountants or experts; (c) makes no warranty or representation to any Lender or
any other Person and shall not be  responsible to any Lender or any other Person
for any statements,  warranties or  representations  made by any Person in or in
connection  with this Agreement or any other Loan  Document;  (d) shall not have
any duty to ascertain or to inquire as to the  performance  or observance of any
of the terms, covenants or conditions of any of this Agreement or any other Loan
Document or the satisfaction of any conditions precedent under this Agreement or
any Loan  Document on the part of the  Borrower or other  Persons or inspect the
property, books or records of the Borrower or any other Person; (e) shall not be
responsible   to  any  Lender  for  the  due  execution,   legality,   validity,
enforceability, genuineness, sufficiency or value of this Agreement or any other
Loan Document,  any other instrument or document  furnished  pursuant thereto or
any  collateral  covered  thereby or the  perfection  or priority of any Lien in
favor of the Agent on  behalf of the  Lenders  in any such  collateral;  and (f)
shall incur no liability under or in respect of this Agreement or any other Loan
Document by acting upon any notice, consent,  certificate or other instrument or
writing (which may be by telephone or telecopy) believed by it to be genuine and
signed, sent or given by the proper party or parties.

Section 11.3.  Notice of Defaults.

         The  Agent  shall  not be  deemed  to have  knowledge  or notice of the
occurrence of a Default or Event of Default unless the Agent has received notice
from a Lender or the  Borrower  referring  to this  Agreement,  describing  with
reasonable  specificity  such  Default or Event of Default and stating that such
notice is a "notice of  default." If any Lender  (excluding  the Lender which is
also serving as the Agent) becomes aware of any Default or Event of Default,  it
shall  promptly  send to the Agent such a "notice of default."  Further,  if the
Agent  receives  such a "notice of default",  the Agent shall give prompt notice
thereof to the Lenders.

Section 11.4.  First Union as Lender.

         First Union,  as a Lender,  shall have the same rights and powers under
this  Agreement and any other Loan Document as any other Lender and may exercise
the same as though it were not the Agent;  and the term  "Lender"  or  "Lenders"
shall, unless otherwise expressly indicated, include First Union in each case in
its individual capacity. First Union and its affiliates may each accept deposits
from, maintain deposits or credit balances for, invest in, lend money to, act as
trustee under indentures of, serve as financial advisor to, and generally engage
in any kind of business  with,  the Borrower,  any other Loan Party or any other
affiliate  thereof as if it were any other bank and  without any duty to account
therefor to the other Lenders.  Further,  the Agent and any affiliate may accept
fees and other  consideration  from the Borrower for services in connection with
this Agreement and otherwise without having to account for the same to the other
Lenders.

                                      -80-
<PAGE>

Section 11.5.  Approvals of Lenders.

         All  communications  from  the  Agent  to any  Lender  requesting  such
Lender's determination,  consent,  approval or disapproval (a) shall be given in
the form of a written  notice to such  Lender,  (b)  shall be  accompanied  by a
description  of the  matter or issue as to which such  determination,  approval,
consent  or  disapproval  is  requested,  or  shall  advise  such  Lender  where
information,  if any, regarding such matter or issue may be inspected,  or shall
otherwise  describe the matter or issue to be resolved,  (c) shall  include,  if
reasonably requested by such Lender and to the extent not previously provided to
such Lender, written materials and a summary of all oral information provided to
the Agent by the Borrower in respect of the matter or issue to be resolved,  and
(d) shall include the Agent's  recommended  course of action or determination in
respect  thereof.  Each Lender shall reply promptly,  but in any event within 10
Business Days (or such lesser or greater period as may be specifically  required
under the Loan Documents) of receipt of such communication.  Except as otherwise
provided  in this  Agreement  and except  with  respect to items  requiring  the
unanimous  consent or approval  of the Lenders  under  Section  12.6.,  unless a
Lender shall give written  notice to the Agent that it  specifically  objects to
the  recommendation  or  determination  of the  Agent  (together  with a written
explanation of the reasons  behind such  objection)  within the applicable  time
period for reply, such Lender shall be deemed to have  conclusively  approved of
or consented to such recommendation or determination.

Section 11.6.  Lender Credit Decision, Etc.

         Each Lender  expressly  acknowledges  and agrees that neither the Agent
nor   any   of   its   officers,   directors,    employees,   agents,   counsel,
attorneys-in-fact or other affiliates has made any representations or warranties
as to the financial condition, operations,  creditworthiness,  solvency or other
information  concerning the business or affairs of the Borrower,  any other Loan
Party,  any Subsidiary or any other Person to such Lender and that no act by the
Agent  hereafter  taken,  including  any review of the affairs of the  Borrower,
shall be deemed to constitute any such  representation  or warranty by the Agent
to any Lender. Each Lender  acknowledges that it has,  independently and without
reliance  upon the Agent,  any other  Lender or counsel to the Agent,  or any of
their respective  officers,  directors,  employees and agents,  and based on the
financial  statements of the Borrower,  the  Subsidiaries or any other Affiliate
thereof,  and inquiries of such Persons,  its  independent  due diligence of the
business and affairs of the Borrower,  the Loan Parties,  the  Subsidiaries  and
other Persons, its review of the Loan Documents,  the legal opinions required to
be  delivered  to it  hereunder,  the advice of its own  counsel  and such other
documents and information as it has deemed appropriate,  made its own credit and
legal  analysis and decision to enter into this  Agreement  and the  transaction
contemplated  hereby. Each Lender also acknowledges that it will,  independently
and without reliance upon the Agent, any other Lender or counsel to the Agent or
any of their respective officers, directors,  employees and agents, and based on
such review,  advice,  documents and information as it shall deem appropriate at
the time,  continue  to make its own  decisions  in taking or not taking  action
under the Loan  Documents.  Except for notices,  reports and other documents and
information expressly required to be furnished to the Lenders by the Agent under
this Agreement or any of the other Loan Documents,  the Agent shall have no duty
or  responsibility  to provide any Lender  with any credit or other  information
concerning the business, operations,  property, financial and other condition or
creditworthiness  of the Borrower,  any other Loan Party or any other  Affiliate
thereof  which

                                      -81-
<PAGE>

may  come  into  possession  of the  Agent  or any of its  officers,  directors,
employees,   agents,   attorneys-in-fact   or  other  Affiliates.   Each  Lender
acknowledges  that the Agent's legal counsel in connection with the transactions
contemplated by this Agreement is only acting as counsel to the Agent and is not
acting as counsel to such Lender.

Section 11.7.  Indemnification of Agent.

         Each Lender agrees to indemnify the Agent (to the extent not reimbursed
by the Borrower and without  limiting the  obligation  of the Borrower to do so)
pro rata in accordance with such Lender's respective Commitment Percentage, from
and against any and all liabilities,  obligations,  losses, damages,  penalties,
actions,  judgments,  suits,  costs,  expenses or  disbursements  of any kind or
nature  whatsoever which may at any time be imposed on, incurred by, or asserted
against  the Agent  (in its  capacity  as Agent but not as a Lender)  in any way
relating to or arising out of the Loan Documents,  any transaction  contemplated
hereby or  thereby or any  action  taken or omitted by the Agent  under the Loan
Documents (collectively,  "Indemnifiable Amounts");  provided,  however, that no
Lender  shall be liable  for any  portion of such  Indemnifiable  Amounts to the
extent resulting from the Agent's gross  negligence or willful  misconduct or if
the Agent fails to follow the written  direction of the Requisite Lenders unless
such  failure  is  pursuant  to the  reasonable  advice of  counsel of which the
Lenders have received  notice.  Without limiting the generality of the foregoing
but subject to the preceding proviso,  each Lender agrees to reimburse the Agent
(to  the  extent  not  reimbursed  by the  Borrower  and  without  limiting  the
obligation  of the Borrower to do so) promptly upon demand for its ratable share
of any out-of-pocket  expenses  (including counsel fees of the counsel(s) of the
Agent's own choosing)  incurred by the Agent in connection with the preparation,
negotiation,  execution,  or enforcement of, or legal advice with respect to the
rights or responsibilities of the parties under, the Loan Documents, any suit or
action  brought by the Agent to enforce the terms of the Loan  Documents  and/or
collect any  Obligations,  any "lender  liability" suit or claim brought against
the Agent  and/or the Lenders,  and any claim or suit brought  against the Agent
and/or the Lenders  arising under any  Environmental  Laws.  Such  out-of-pocket
expenses  (including  counsel  fees)  shall be  advanced  by the  Lenders on the
request of the Agent  notwithstanding  any claim or assertion  that the Agent is
not entitled to indemnification  hereunder upon receipt of an undertaking by the
Agent that the Agent will  reimburse  the Lenders if it is actually  and finally
determined  by a court  of  competent  jurisdiction  that  the  Agent  is not so
entitled to  indemnification.  The  agreements in this Section shall survive the
payment of the Loans and all other amounts payable  hereunder or under the other
Loan  Documents and the  termination  of this  Agreement.  If the Borrower shall
reimburse the Agent for any Indemnifiable Amount following payment by any Lender
to the Agent in respect of such  Indemnifiable  Amount pursuant to this Section,
the Agent shall  share such  reimbursement  on a ratable  basis with each Lender
making any such payment.

Section 11.8.  Successor Agent.

         The Agent may resign at any time as Agent under the Loan  Documents  by
giving written notice thereof to the Lenders and the Borrower.  The Agent may be
removed as Agent under the Loan  Documents  for good cause by all of the Lenders
(other than the Lender  then  acting as the Agent)  upon 30 days' prior  notice.
Upon any such  resignation  or removal,  the Requisite  Lenders  (other than the
Lender then  acting as Agent,  in the case of the removal of the Agent under the

                                      -82-
<PAGE>

immediately  preceding  sentence)  shall have the right to  appoint a  successor
Agent which  appointment  shall,  provided no Default or Event of Default  shall
have occurred and be continuing,  be subject to the Borrower's  approval,  which
approval shall not be unreasonably withheld or delayed (except that the Borrower
shall, in all events,  be deemed to have approved each Lender and its affiliates
as a successor  Agent).  If no  successor  Agent shall have been so appointed in
accordance with the immediately preceding sentence, and shall have accepted such
appointment,  within 30 days  after the  resigning  Agent's  giving of notice of
resignation or the Lenders' removal of the resigning  Agent,  then the resigning
or removed Agent may, on behalf of the Lenders, appoint a successor Agent, which
shall be a Lender,  if any Lender shall be willing to serve, and otherwise shall
be a commercial bank having total combined  assets of at least  $50,000,000,000.
Upon the acceptance of any appointment as Agent hereunder by a successor  Agent,
such successor Agent shall  thereupon  succeed to and become vested with all the
rights,  powers,  privileges and duties of the retiring Agent,  and the retiring
Agent  shall be  discharged  from its  duties  and  obligations  under  the Loan
Documents.  After any Agent's  resignation  or removal  hereunder as Agent,  the
provisions of this Article XI. shall  continue to inure to its benefit as to any
actions  taken or  omitted  to be taken by it while it was Agent  under the Loan
Documents.

Section 11.9.  Titled Agents.

         Each of the Titled Agents in each such respective capacity,  assumes no
responsibility  or obligation  hereunder,  including,  without  limitation,  for
servicing,  enforcement or collection of any of the Loans,  nor any duties as an
agent  hereunder  for the  Lenders.  The  titles  of "Lead  Arranger",  "Co-Lead
Arranger",  "Syndication  Agent" and "Documentation  Agent" are solely honorific
and imply no fiduciary  responsibility  on the part of the Titled  Agents to the
Agent,  the Borrower or any Lender and the use of such titles does not impose on
the  Titled  Agents any duties or  obligations  greater  than those of any other
Lender or entitle the Titled  Agents to any rights other than those to which any
other Lender is entitled.

                           ARTICLE XII. MISCELLANEOUS

Section 12.1.  Notices.

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

         If to the Borrower:

                  HRPT Properties Trust
                  400 Centre Street
                  Newton, Massachusetts  02458
                  Attention:  Treasurer
                  Telecopy Number:   (617) 332-2261
                  Telephone Number:  (617) 332-3990

                                      -83-
<PAGE>

         If to the Agent:

                  First Union National Bank
                  One First Union Center, TW-6
                  Charlotte, North Carolina 28288-0166
                  Attention: Rex E. Rudy
                  Telecopy Number:    (704) 383-6205
                  Telephone Number:   (704) 383-6506

         If to a Lender:

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

or, as to each party at such other  address as shall be designated by such party
in a written  notice to the other  parties  delivered  in  compliance  with this
Section.  All such notices and other  communications  shall be effective  (i) if
mailed, when received;  (ii) if telecopied,  when transmitted;  or (iii) if hand
delivered,  when delivered.  Notwithstanding the immediately preceding sentence,
all notices or communications to the Agent or any Lender under Article II. shall
be effective only when actually received. Neither the Agent nor any Lender shall
incur any  liability to the Borrower (nor shall the Agent incur any liability to
the Lenders) for acting upon any telephonic notice referred to in this Agreement
which the Agent or such  Lender,  as the case may be,  believes in good faith to
have been given by a Person  authorized  to deliver such notice or for otherwise
acting in good faith hereunder.

Section 12.2.  Expenses.

         The Borrower  agrees (a) to pay or  reimburse  the Agent for all of its
reasonable  out-of-pocket  costs and expenses  incurred in  connection  with the
preparation,  negotiation  and  execution of, and any  amendment,  supplement or
modification to, any of the Loan Documents (including due diligence expenses and
travel expenses  relating to closing),  and the consummation of the transactions
contemplated thereby, including the reasonable fees and disbursements of counsel
to the Agent,  (b) to pay or  reimburse  the Agent and the Lenders for all their
costs and expenses  incurred in connection  with the enforcement or preservation
of any  rights  under the Loan  Documents,  including  the  reasonable  fees and
disbursements  of their  respective  counsel  (including  the allocated fees and
expenses of in-house counsel) and any payments in  indemnification  or otherwise
payable by the Lenders to the Agent pursuant to the Loan Documents,  (c) to pay,
and  indemnify  and hold  harmless the Agent and the Lenders  from,  any and all
recording  and  filing  fees and any and all  liabilities  with  respect  to, or
resulting from any failure to pay or delay in paying, documentary, stamp, excise
and other  similar  taxes,  if any,  which may be  payable or  determined  to be
payable  in  connection  with  the  execution  and  delivery  of any of the Loan
Documents,  or consummation of any amendment,  supplement or modification of, or
any waiver or consent  under or in respect of, any Loan  Document and (d) to the
extent  not  already  covered  by any of the  preceding  subsections,  to pay or
reimburse the Agent and the Lenders for all their costs and expenses incurred in
connection  with any  bankruptcy or other  proceeding  of the type  described in
Sections  10.1.(f) or 10.1.(g),  including the reasonable fees

                                      -84-
<PAGE>

and disbursements of counsel to the Agent and any Lender,  whether such fees and
expenses  are  incurred  prior  to,  during or after  the  commencement  of such
proceeding or the  confirmation  or conclusion  of any such  proceeding.  If the
Borrower  shall fail to pay any  amounts  required  to be paid by it pursuant to
this Section, the Agent and/or the Lenders may pay such amounts on behalf of the
Borrower and either deem the same to be Loans outstanding hereunder or otherwise
Obligations owing hereunder.

Section 12.3.  Setoff.

         Subject to Section  3.3. and in addition to any rights now or hereafter
granted  under  Applicable  Law and not by way of limitation of any such rights,
the  Agent,  each  Lender  and each  Participant  is  hereby  authorized  by the
Borrower, at any time or from time to time during the continuance of an Event of
Default,  without prior notice to the Borrower or to any other Person,  any such
notice being hereby expressly waived, but in the case of a Lender or Participant
subject to receipt of the prior  written  consent of the Agent  exercised in its
sole discretion, to set off and to appropriate and to apply any and all deposits
(general or special,  including,  but not limited to, indebtedness  evidenced by
certificates   of  deposit,   whether   matured  or  unmatured)  and  any  other
indebtedness  at any  time  held or  owing  by the  Agent,  such  Lender  or any
affiliate  of the Agent or such  Lender,  to or for the credit or the account of
the Borrower against and on account of any of the  Obligations,  irrespective of
whether  or not any or all of the  Loans  and all  other  Obligations  have been
declared  to be, or have  otherwise  become,  due and  payable as  permitted  by
Section 10.2., and although such  obligations  shall be contingent or unmatured.
Promptly  following any such set-off the Agent shall notify the Borrower thereof
and of the  application of such set-off,  provided that the failure to give such
notice shall not invalidate such set-off.

Section 12.4.  Litigation; Jurisdiction; Other Matters; Waivers.

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

         (b) EACH OF THE BORROWER,  THE AGENT AND EACH LENDER HEREBY AGREES THAT
THE  FEDERAL  DISTRICT  COURT OF THE  SOUTHERN  DISTRICT  OF NEW YORK OR, AT THE
OPTION OF THE AGENT,  ANY STATE COURT LOCATED IN NEW YORK, NEW YORK,  SHALL HAVE
JURISDICTION  TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES  BETWEEN OR AMONG THE
BORROWER, THE AGENT OR ANY OF THE LENDERS,  PERTAINING DIRECTLY OR INDIRECTLY TO
THIS

                                      -85-
<PAGE>

AGREEMENT, THE LOANS AND LETTERS OF CREDIT, THE NOTES OR ANY OTHER LOAN DOCUMENT
OR TO ANY MATTER  ARISING  HEREFROM OR  THEREFROM.  THE BORROWER AND EACH OF THE
LENDERS  EXPRESSLY  SUBMITS AND CONSENTS IN ADVANCE TO SUCH  JURISDICTION IN ANY
ACTION OR PROCEEDING  COMMENCED IN SUCH COURTS.  EACH PARTY  FURTHER  WAIVES ANY
OBJECTION  THAT IT MAY NOW OR HEREAFTER  HAVE TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN
INCONVENIENT FORUM AND EACH AGREES NOT TO PLEAD OR CLAIM THE SAME. THE CHOICE OF
FORUM SET FORTH IN THIS SECTION  SHALL NOT BE DEEMED TO PRECLUDE THE BRINGING OF
ANY  ACTION BY THE AGENT OR ANY  LENDER OR THE  ENFORCEMENT  BY THE AGENT OR ANY
LENDER  OF  ANY  JUDGMENT  OBTAINED  IN  SUCH  FORUM  IN ANY  OTHER  APPROPRIATE
JURISDICTION.

         (c) THE  PROVISIONS OF THIS SECTION HAVE BEEN  CONSIDERED BY EACH PARTY
WITH  THE  ADVICE  OF  COUNSEL  AND  WITH A  FULL  UNDERSTANDING  OF  THE  LEGAL
CONSEQUENCES  THEREOF,  AND SHALL SURVIVE THE PAYMENT OF THE LOANS AND ALL OTHER
AMOUNTS PAYABLE HEREUNDER OR UNDER THE OTHER LOAN DOCUMENTS,  THE TERMINATION OR
EXPIRATION OF ALL LETTERS OF CREDIT AND THE TERMINATION OF THIS AGREEMENT.

Section 12.5.  Successors and Assigns.

         (a) The provisions of this Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective  successors and permitted
assigns,  except that the Borrower  may not assign or otherwise  transfer any of
its rights or obligations under this Agreement without the prior written consent
of all Lenders  and any such  assignment  or other  transfer to which all of the
Lenders have not so consented shall be null and void.

         (b) Any  Lender  may make,  carry or  transfer  Loans at, to or for the
account of any of its  branch  offices  or the  office of an  affiliate  of such
Lender except to the extent such transfer would result in increased costs to the
Borrower.

         (c) Any  Lender  may at any time  grant  to one or more  banks or other
financial  institutions  (each a "Participant")  participating  interests in its
Commitment or the Obligations owing to such Lender;  provided,  however, (i) any
such participating  interest must be for a constant and not a varying percentage
interest,  (ii) no Lender may grant a participating  interest in its Commitment,
or if the Commitments have been terminated,  the aggregate outstanding principal
balance of Notes held by it, in an amount less than  $5,000,000  and (iii) after
giving  effect  to  any  such  participation  by a  Lender,  the  amount  of its
Commitment,   or  if  the  Commitments  have  been  terminated,   the  aggregate
outstanding  principal  balance of Notes held by it, in which it has not granted
any participating  interests must be equal to $5,000,000 and integral  multiples
of $1,000,000 in excess thereof.  Except as otherwise provided in Section 12.3.,
no  Participant  shall have any rights or benefits  under this  Agreement or any
other  Loan  Document.  In  the  event  of  any  such  grant  by a  Lender  of a
participating  interest to a Participant,  such Lender shall remain  responsible
for the performance of its obligations

                                      -86-
<PAGE>

hereunder,  and the  Borrower  and the Agent  shall  continue to deal solely and
directly  with  such  Lender  in  connection   with  such  Lender's  rights  and
obligations under this Agreement. Any agreement pursuant to which any Lender may
grant such a participating  interest shall provide that such Lender shall retain
the sole right and  responsibility  to enforce the  obligations  of the Borrower
hereunder  including,  without  limitation,  the right to approve any amendment,
modification  or waiver of any provision of this Agreement;  provided,  however,
such Lender may agree with the Participant that it will not, without the consent
of the Participant, agree to (i) increase, or extend the term or extend the time
or waive any  requirement  for the  reduction or  termination  of, such Lender's
Commitment,  (ii)  extend the date  fixed for the  payment  of  principal  of or
interest on the Loans or portions thereof owing to such Lender, (iii) reduce the
amount of any such payment of principal,  (iv) reduce the rate at which interest
is payable thereon or (v) release any Guarantor  (except as otherwise  permitted
under Section 7.12.(b)).  An assignment or other transfer which is not permitted
by  subsection  (d) or (e) below  shall be given  effect  for  purposes  of this
Agreement only to the extent of a participating  interest  granted in accordance
with this  subsection  (c).  The selling  Lender  shall notify the Agent and the
Borrower of the sale of any  participation  hereunder  and, if  requested by the
Agent, certify to the Agent that such participation is permitted hereunder.

         (d) Any Lender may with the prior written  consent of the Agent and, so
long as no Default or Event of Default  shall have  occurred and be  continuing,
the Borrower (which consent, in each case, shall not be unreasonably  withheld),
assign to one or more Eligible  Assignees  (each an "Assignee") all or a portion
of its Commitment and its other rights and obligations  under this Agreement and
the Notes;  provided,  however,  (i) no such  consent by the  Borrower  shall be
required in the case of any  assignment  to another  Lender or any  affiliate of
such Lender or another Lender and no such consent by the Agent shall be required
in the case of any assignment by a Lender to any affiliate of such Lender;  (ii)
any partial  assignment  shall be in an amount at least equal to $5,000,000  and
integral  multiples of $1,000,000  in excess  thereof and after giving effect to
such assignment the assigning Lender retains a Commitment, or if the Commitments
have been  terminated,  holds Notes  having an aggregate  outstanding  principal
balance,  of at least $5,000,000 and integral  multiples of $1,000,000 in excess
thereof;  (iii) each such assignment shall be effected by means of an Assignment
and Acceptance Agreement; and (iv) after giving effect to any such assignment by
the Lender then acting as Agent,  such Lender shall retain a Commitment  greater
than or equal to the  lesser  of (x) the  Commitment  of such  Lender  as of the
Agreement Date (or the date such Lender first became a party to this Agreement )
or (y)  the  Commitment  of any  other  Lender  (other  than  any  Lender  whose
Commitment  has  increased  as a result  of a merger or other  combination  with
another  Lender).  Upon execution and delivery of such instrument and payment by
such Assignee to such transferor Lender of an amount equal to the purchase price
agreed between such transferor Lender and such Assignee,  such Assignee shall be
deemed to be a Lender party to this  Agreement as of the  effective  date of the
Assignment  and  Acceptance   Agreement  and  shall  have  all  the  rights  and
obligations  of a Lender with a Commitment as set forth in such  Assignment  and
Acceptance  Agreement,  and the  transferor  Lender  shall be released  from its
obligations  hereunder  to a  corresponding  extent,  and no further  consent or
action by any party shall be required.  Upon the  consummation of any assignment
pursuant  to this  subsection  (d),  the  transferor  Lender,  the Agent and the
Borrower shall make appropriate arrangements so that new Notes are issued to the
Assignee and such transferor Lender, as appropriate. In connection with any such
assignment,  the transferor Lender

                                      -87-
<PAGE>

shall pay to the Agent an  administrative  fee for processing such assignment in
the amount of $3,500.

         (e) Any Lender (each, a "Designating Lender") may at any time while the
Borrower has been assigned an Investment Grade Rating from either S&P or Moody's
designate  one  Designated  Lender  to fund Bid Rate  Loans  on  behalf  of such
Designating  Lender  subject  to the  terms  of  this  subsection  (e)  and  the
provisions in the immediately  preceding subsections (c) and (d) shall not apply
to such  designation.  No Lender may designate more than one Designated  Lender.
The parties to each such designation  shall execute and deliver to the Agent for
its acceptance a Designation  Agreement.  Upon such receipt of an  appropriately
completed  Designation Agreement executed by a Designating Lender and a designee
representing  that  it is a  Designated  Lender,  the  Agent  will  accept  such
Designation Agreement and give prompt notice thereof to the Borrower,  whereupon
(i)  the  Borrower  shall  execute  and  deliver  to the  Designating  Lender  a
Designated Lender Note payable to the order of the Designated Lender,  (ii) from
and after  the  effective  date  specified  in the  Designation  Agreement,  the
Designated  Lender shall become a party to this  Agreement  with a right to make
Bid Rate Loans on behalf of its  Designating  Lender  pursuant  to Section  2.2.
after the  Borrower  has  accepted a Bid Rate Loan (or  portion  thereof) of the
Designating  Lender,  and (iii) the  Designated  Lender shall not be required to
make payments with respect to any  obligations in this  Agreement  except to the
extent of excess  cash flow of such  Designated  Lender  which is not  otherwise
required to repay  obligations of such Designated  Lender which are then due and
payable;  provided,  however, that regardless of such designation and assumption
by the Designated  Lender,  the Designating Lender shall be and remain obligated
to the Borrower, the Agent and the Lenders for each and every of the obligations
of the Designating Lender and its related Designated Lender with respect to this
Agreement,  including, without limitation, any indemnification obligations under
Section 11.7. and any sums  otherwise  payable to the Borrower by the Designated
Lender.  Each Designating Lender shall serve as the administrative  agent of the
Designated  Lender  and  shall  on  behalf  of,  and to the  exclusion  of,  the
Designated  Lender: (i) receive any and all payments made for the benefit of the
Designated Lender and (ii) give and receive all  communications  and notices and
take all actions hereunder,  including,  without limitation,  votes,  approvals,
waivers,  consents and  amendments  under or relating to this  Agreement and the
other Loan Documents. Any such notice,  communication,  vote, approval,  waiver,
consent or amendment shall be signed by the Designating Lender as administrative
agent for the Designated Lender and shall not be signed by the Designated Lender
on its own  behalf and shall be  binding  on the  Designated  Lender to the same
extent as if signed by the  Designated  Lender on its own behalf.  The Borrower,
the Agent and the Lenders may rely  thereon  without  any  requirement  that the
Designated  Lender sign or acknowledge the same. No Designated Lender may assign
or transfer all or any portion of its interest hereunder or under any other Loan
Document,  other than  assignments to the  Designating  Lender which  originally
designated such Designated Lender. The Borrower,  the Lenders and the Agent each
hereby agrees that it will not institute  against any Designated  Lender or join
any other Person in instituting  against any Designated  Lender any  bankruptcy,
reorganization,  arrangement,  insolvency or  liquidation  proceeding  under any
federal or state  bankruptcy or similar law, until the later to occur of (x) one
year and one day after the  payment  in full of the latest  maturing  commercial
paper note issued by such Designated Lender and (y) the Termination Date.

                                      -88-
<PAGE>

         (f) The Agent  shall  maintain at the  Principal  Office a copy of each
Assignment  and  Acceptance  Agreement  delivered  to and  accepted  by it and a
register for the  recordation  of the names and addresses of the Lenders and the
Commitment  of each Lender from time to time (the  "Register").  The Agent shall
give each Lender and the Borrower  notice of the assignment by any Lender of its
rights as contemplated by this Section. The Borrower,  the Agent and the Lenders
may treat  each  Person  whose  name is  recorded  in the  Register  as a Lender
hereunder  for all purposes of this  Agreement.  The Register and copies of each
Assignment  and  Acceptance  Agreement  shall be available for inspection by the
Borrower  or any  Lender  at any  reasonable  time  and from  time to time  upon
reasonable  prior  notice to the Agent.  Upon its receipt of an  Assignment  and
Acceptance  Agreement  executed by an assigning Lender,  together with each Note
subject to such  assignment,  the Agent shall, if such Assignment and Acceptance
Agreement  has been  completed  and if the Agent  receives  the  processing  and
recording fee described in subsection (d) above,  (i) accept such Assignment and
Acceptance  Agreement,  (ii)  record the  information  contained  therein in the
Register and (iii) give prompt notice thereof to the Borrower.

         (g) In addition to the assignments and  participations  permitted under
the foregoing  provisions of this Section,  any Lender may assign and pledge all
or any  portion  of its  Loans  and its  Notes to any  Federal  Reserve  Bank as
collateral  security pursuant to Regulation A and any Operating  Circular issued
by such  Federal  Reserve  Bank,  and  such  Loans  and  Notes  shall  be  fully
transferable as provided therein. No such assignment shall release the assigning
Lender from its obligations hereunder.

         (h) A Lender may furnish any information  concerning the Borrower,  any
other Loan Party or any of their  respective  Subsidiaries  in the possession of
such  Lender  from  time  to  time  to  Assignees  and  Participants  (including
prospective Assignees and Participants) subject to compliance with Section 12.8.

         (i) Anything in this Section to the contrary notwithstanding, no Lender
may assign or  participate  any interest in any Loan held by it hereunder to the
Borrower,  any  other  Loan  Party  or any of  their  respective  Affiliates  or
Subsidiaries.

         (j) Each Lender agrees that,  without the prior written  consent of the
Borrower and the Agent, it will not make any assignment  hereunder in any manner
or under any circumstances that would require  registration or qualification of,
or filings in respect of, any Loan or Note under the Securities Act or any other
securities laws of the United States of America or of any other jurisdiction.

Section 12.6.  Amendments.

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

                                      -89-
<PAGE>

(and, in the case of an amendment to any Loan Document,  the written  consent of
the Borrower).  Notwithstanding the foregoing,  no amendment,  waiver or consent
shall, unless in writing,  and signed by all of the Lenders (or the Agent at the
written  direction of the Lenders),  do any of the  following:  (i) increase the
Commitments of the Lenders  (except as contemplated by Section 2.16.) or subject
the Lenders to any  additional  obligations;  (ii) reduce the  principal  of, or
interest  rates that have  accrued  or that will be  charged on the  outstanding
principal  amount of, any Loans or Fees or other  Obligations;  (iii) reduce the
amount of any Fees  payable  hereunder;  (iv)  postpone  any date  fixed for any
payment of any principal of, or interest on, any Loans or any other Obligations,
or extend the  expiration  date of any Letter of Credit  beyond the  Termination
Date; (v) change the Commitment  Percentages (except as a result of any increase
in the  aggregate  amount of the  Commitments  contemplated  by  Section  2.16.,
3.11.(b) or 4.5.) or amend or otherwise  modify the  provisions of Section 3.2.;
(vi) amend  Section  9.1.(e) or waive any Default or Event of Default  occurring
under Section 10.1.(c)  resulting from a violation of such Section;  (vii) amend
the definition of "Unencumbered  Asset Value" (or any of the definitions used in
such definition or the  percentages or rates used in the  calculation  thereof);
(viii)  modify the  definition  of the term  "Requisite  Lenders" or,  except as
otherwise provided in the immediately  following clause (x), modify in any other
manner  the  number  or  percentage   of  the  Lenders   required  to  make  any
determinations  or waive any rights hereunder or to modify any provision hereof,
including  without  limitation,   any  modification  of  this  Section  if  such
modification  would  have such  effect;  (ix)  release  any  Guarantor  from its
obligations  under the Guaranty  (except as otherwise  permitted  under  Section
7.12.(b));  or (x) amend or otherwise modify the provisions of Section 2.15.(a).
In addition,  no  amendment,  waiver or consent  shall,  unless in writing,  and
signed by the  Supermajority  Lenders (or the Agent at the written  direction of
the  Supermajority  Lenders),  do any of the  following:  (x) amend or otherwise
modify the provisions of, or waive any Event of Default occurring under, Section
10.1.(m)  or (y)  modify the  definition  of the term  "Supermajority  Lenders".
Further,  no  amendment,  waiver or consent  unless in writing and signed by the
Agent,  in addition to the Lenders  required  hereinabove  to take such  action,
shall  affect the rights or duties of the Agent under this  Agreement  or any of
the other Loan Documents.  Any amendment,  waiver or consent relating to Section
2.3. or the  obligations  of the  Swingline  Lender under this  Agreement or any
other Loan Document  shall, in addition to the Lenders  required  hereinabove to
take such action, require the written consent of the Swingline Lender. No waiver
shall  extend to or affect any  obligation  not  expressly  waived or impair any
right consequent thereon and any amendment, waiver or consent shall be effective
only in the specific instance and for the specific purpose set forth therein. No
course of dealing or delay or omission on the part of the Agent or any Lender in
exercising  any  right  shall  operate  as a  waiver  thereof  or  otherwise  be
prejudicial  thereto.  Except as otherwise  explicitly provided for herein or in
any other Loan Document,  no notice to or demand upon the Borrower shall entitle
the  Borrower  to any other or  further  notice or  demand in  similar  or other
circumstances.

Section 12.7.  Nonliability of Agent and Lenders.

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

                                      -90-
<PAGE>

any  responsibility  to the  Borrower  to review or inform the  Borrower  of any
matter in connection with any phase of the Borrower's business or operations.

Section 12.8.  Confidentiality.

         Except as  otherwise  provided by  Applicable  Law,  the Agent and each
Lender  shall  utilize  all  non-public  information  obtained  pursuant  to the
requirements  of this Agreement  which has been  identified as  confidential  or
proprietary  by the Borrower in  accordance  with its  customary  procedure  for
handling confidential information of this nature and in accordance with safe and
sound  banking  practices  but in any event may make  disclosure:  (a) to any of
their respective  affiliates (provided they shall agree to keep such information
confidential  in accordance  with the terms of this Section);  (b) as reasonably
requested  by any  bona  fide  Assignee,  Participant  or  other  transferee  in
connection with the  contemplated  transfer of any Commitment or  participations
therein  as  permitted  hereunder  (provided  they  shall  agree  to  keep  such
information  confidential in accordance with the terms of this Section);  (c) as
required or requested by any Governmental Authority or representative thereof or
pursuant to legal process or in connection  with any legal  proceedings;  (d) to
the  Agent's  or such  Lender's  independent  auditors  and  other  professional
advisors  (provided  they shall be  notified of the  confidential  nature of the
information);  (e) after the happening and during the continuance of an Event of
Default,  to any other Person,  in connection  with the exercise by the Agent or
the Lenders of rights  hereunder or under any of the other Loan  Documents;  and
(f) to the extent such information (x) becomes publicly  available other than as
a result of a breach of this  Section or (y) becomes  available  to the Agent or
any Lender on a  nonconfidential  basis from a source other than the Borrower or
any Affiliate.

Section 12.9.  Indemnification.

         (a) The Borrower shall and hereby agrees to indemnify,  defend and hold
harmless the Agent, any affiliate of the Agent and each of the Lenders and their
respective  directors,  officers,  shareholders,  agents,  employees and counsel
(each referred to herein as an "Indemnified Party") from and against any and all
losses, costs, claims, damages, liabilities, deficiencies, judgments or expenses
of  every  kind and  nature  (including,  without  limitation,  amounts  paid in
settlement,  court costs and the fees and  disbursements  of counsel incurred in
connection with any litigation, investigation, claim or proceeding or any advice
rendered in connection therewith,  but excluding losses, costs, claims, damages,
liabilities,  deficiencies,  judgments or expenses indemnification in respect of
which is  specifically  covered by Section 3.12.  or 4.1. or expressly  excluded
from  the  coverage  of such  Sections)  incurred  by an  Indemnified  Party  in
connection  with,  arising  out of, or by reason of, any suit,  cause of action,
claim,  arbitration,  investigation  or  settlement,  consent  decree  or  other
proceeding (the foregoing referred to herein as an "Indemnity Proceeding") which
is in any way related directly or indirectly to: (i) this Agreement or any other
Loan Document or the transactions  contemplated  thereby; (ii) the making of any
Loans or issuance of Letters of Credit  hereunder;  (iii) any actual or proposed
use by the Borrower of the proceeds of the Loans or Letters of Credit;  (iv) the
Agent's or any  Lender's  entering  into this  Agreement;  (v) the fact that the
Agent and the Lenders have  established the credit facility  evidenced hereby in
favor of the  Borrower;  (vi)  the  fact  that the  Agent  and the  Lenders  are
creditors of the Borrower and have or are alleged to have information  regarding
the financial condition,  strategic plans or business operations of the Borrower
and the Subsidiaries; (vii) the fact that the Agent

                                      -91-
<PAGE>

and the  Lenders  are  material  creditors  of the  Borrower  and are alleged to
influence  directly  or  indirectly  the  business  decisions  or affairs of the
Borrower and the Subsidiaries or their financial condition;  (viii) the exercise
of any right or remedy the Agent or the Lenders may have under this Agreement or
the other Loan  Documents;  provided,  however,  that the Borrower  shall not be
obligated to indemnify any  Indemnified  Party for any acts or omissions of such
Indemnified  Party in  connection  with matters  described in this clause (viii)
that constitute gross negligence or willful misconduct; or (ix) any violation or
non-compliance  by  the  Borrower  or  any  Subsidiary  of  any  Applicable  Law
(including any Environmental  Law) including,  but not limited to, any Indemnity
Proceeding  commenced  by (A) the  Internal  Revenue  Service  or  state  taxing
authority  or  (B)  any  Governmental   Authority  or  other  Person  under  any
Environmental   Law,   including  any  Indemnity   Proceeding   commenced  by  a
Governmental Authority or other Person seeking remedial or other action to cause
the Borrower or its  Subsidiaries  (or its respective  properties) (or the Agent
and/or the Lenders as successors to the Borrower) to be in compliance  with such
Environmental Laws.

         (b) The Borrower's indemnification obligations under this Section shall
apply to all Indemnity  Proceedings arising out of, or related to, the foregoing
whether  or  not an  Indemnified  Party  is a  named  party  in  such  Indemnity
Proceeding.  In this connection,  this indemnification shall cover all costs and
expenses of any  Indemnified  Party in  connection  with any  deposition  of any
Indemnified  Party or  compliance  with any  subpoena  (including  any  subpoena
requesting the production of documents). This indemnification shall, among other
things,  apply to any Indemnity  Proceeding  commenced by other creditors of the
Borrower or any  Subsidiary,  any  shareholder of the Borrower or any Subsidiary
(whether such shareholder(s) are prosecuting such Indemnity  Proceeding in their
individual  capacity or  derivatively  on behalf of the  Borrower),  any account
debtor of the Borrower or any Subsidiary or by any Governmental Authority.

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

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

         (e) An Indemnified  Party may conduct its own investigation and defense
of,  and may  formulate  its own  strategy  with  respect  to,  any  Indemnified
Proceeding  covered  by this  Section  and,  as  provided  above,  all costs and
expenses incurred by such Indemnified Party shall be reimbursed by the Borrower.
No action taken by legal counsel chosen by an Indemnified Party in investigating
or defending against any such Indemnified Proceeding shall vitiate or in any way
impair the  obligations  and duties of the Borrower  hereunder to indemnify  and
hold harmless each such Indemnified Party;  provided,  however,  that (i) if the
Borrower is required to indemnify an Indemnified  Party pursuant hereto and (ii)
the Borrower has provided evidence  reasonably  satisfactory to such Indemnified
Party  that  the  Borrower  has the  financial  wherewithal  to

                                      -92-
<PAGE>

reimburse such Indemnified  Party for any amount paid by such Indemnified  Party
with respect to such Indemnified  Proceeding,  such Indemnified  Party shall not
settle or compromise any such Indemnified  Proceeding  without the prior written
consent of the Borrower  (which  consent shall not be  unreasonably  withheld or
delayed).

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

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

Section 12.10.  Termination; Survival.

         At such time as (a) all of the Commitments  have been  terminated,  (b)
all Letters of Credit have terminated, (c) none of the Lenders nor the Swingline
Lender is obligated  any longer  under this  Agreement to make any Loans and (d)
all  Obligations  (other  than  obligations  which  survive as  provided  in the
following  sentence) have been paid and satisfied in full,  this Agreement shall
terminate.  The  indemnities  to which the Agent,  the Lenders and the Swingline
Lender are entitled under the provisions of Sections 3.12.,  4.1., 4.4.,  11.7.,
12.2.  and 12.9.  and any other  provision of this  Agreement and the other Loan
Documents, and the provisions of Section 12.4., shall continue in full force and
effect and shall  protect the Agent,  the Lenders and the  Swingline  Lender (i)
notwithstanding  any  termination  of  this  Agreement,  or of  the  other  Loan
Documents,  against events arising after such  termination as well as before and
(ii) at all times  after any such party  ceases to be a party to this  Agreement
with  respect to all  matters  and events  existing on or prior to the date such
party ceased to be a party to this Agreement.

Section 12.11.  Severability of Provisions.

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

Section 12.12.  GOVERNING LAW.

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

Section 12.13.  Counterparts.

         This Agreement and any amendments, waivers, consents or supplements may
be executed in any number of  counterparts  and by different  parties  hereto in
separate  counterparts,

                                      -93-
<PAGE>

each of which when so executed and  delivered  shall be deemed an original,  but
all of  which  counterparts  together  shall  constitute  but one  and the  same
instrument.

Section 12.14.  Obligations with Respect to Loan Parties.

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

Section 12.15.  Limitation of Liability.

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

Section 12.16.  Entire Agreement.

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

Section 12.17.  Construction.

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

SECTION 12.18.  LIABILITY OF TRUSTEES, ETC.

         THE PARTIES HERETO ACKNOWLEDGE AND AGREE AS FOLLOWS:

         THE  AMENDED  AND  RESTATED   DECLARATION  OF  TRUST  ESTABLISHING  THE
BORROWER,  DATED JULY 1, 1994,  A COPY OF WHICH,  TOGETHER  WITH ALL  AMENDMENTS
THERETO (THE "DECLARATION"), IS DULY FILED IN THE OFFICE

                                      -94-
<PAGE>

OF THE STATE  DEPARTMENT OF ASSESSMENTS AND TAXATION OF MARYLAND,  PROVIDES THAT
THE NAME "HRPT  PROPERTIES  TRUST" REFERS TO THE TRUSTEES UNDER THE  DECLARATION
COLLECTIVELY  AS  TRUSTEES,  BUT NOT  INDIVIDUALLY  OR  PERSONALLY,  AND THAT NO
TRUSTEE, OFFICER,  SHAREHOLDER,  EMPLOYEE OR AGENT OF THE BORROWER SHALL BE HELD
TO ANY PERSONAL LIABILITY, JOINTLY OR SEVERALLY, FOR ANY OBLIGATION OF, OR CLAIM
AGAINST, THE BORROWER.  ALL PERSONS DEALING WITH THE BORROWER, IN ANY WAY, SHALL
LOOK  ONLY TO THE  ASSETS  OF THE  BORROWER  FOR THE  PAYMENT  OF ANY SUM OR THE
PERFORMANCE  OF ANY  OBLIGATION.  THE PROVISIONS OF THIS SECTION SHALL NOT LIMIT
ANY OBLIGATIONS OF ANY LOAN PARTY OTHER THAN THE BORROWER.

                         [Signatures on Following Pages]

                                      -95-
<PAGE>

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

                                  Borrower:

                                  HRPT Properties Trust

                                  By:  /s/ John C. Popeo
                                       Name:  John C. Popeo
                                       Title: Treasurer, Secretary, CFO

                                  Attest:  /s/ Jennifer B. Clark
                                       Name:  Jennifer B. Clark
                                       Title: Senior Vice President/Assistant
                                              Secretary

                       [Signatures Continued on Next Page]

                                      -96-
<PAGE>

                 [Signature Page to Credit Agreement dated as of
                   April 30, 2001 with HRPT Properties Trust]

                             First Union National Bank, as Agent, as a Lender
                              and as Swingline Lender

                             By:  /s/ Rex E. Rudy
                                  Name:  Rex E. Rudy
                                  Title:  Vice President

                             Commitment Amount:

                             $70,000,000

                             Lending Office (all Types of Loans):

                             First Union National Bank
                             REIT Banking Group
                             One First Union Center, NC5604
                             301 South College Street
                             Charlotte, North Carolina  28288
                             Attn:  Rex E. Rudy
                             Telecopier:       (704) 383-6205
                             Telephone:        (704) 383-6506

                       [Signatures Continued on Next Page]

                                      -97-
<PAGE>

                 [Signature Page to Credit Agreement dated as of
                   April 30, 2001 with HRPT Properties Trust]

                             FLEET NATIONAL BANK

                             By: /s/ James B. McLaughlin
                                 Name: James B. McLaughlin
                                 Title: Director

                              Commitment Amount:

                              $63,000,000

                              Lending Office (all Types of Loans):

                              Fleet National Bank
                              100 Federal Street
                              MA DE 10009A
                              Boston, MA 02110
                              Attn: James B. McLaughlin
                              Telecopier:       617.434.0645
                              Telephone:        617.434.1448

                       [Signatures Continued on Next Page]

                                      -98-
<PAGE>

                 [Signature Page to Credit Agreement dated as of
                   April 30, 2001 with HRPT Properties Trust]

                             WELLS FARGO BANK, NATIONAL ASSOCIATION

                             By:  /s/ Douglas S. Novitch
                                  Name: Douglas S. Novitch
                                  Title: Vice President

                             Commitment Amount:

                             $60,000,000

                             Lending Office (all Types of Loans):

                             Wells Fargo Bank, National Association
                             121 High Street, 5th Floor
                             Boston, MA  02110
                             Attn:  Douglas S. Novitch
                             Telecopier:       617-772-9337
                             Telephone:        617-574-6307

                       [Signatures Continued on Next Page]

                                      -99-
<PAGE>

                 [Signature Page to Credit Agreement dated as of
                   April 30, 2001 with HRPT Properties Trust]

                  COMMERZBANK AG, NEW YORK AND GRAND CAYMAN BRANCHES

                  By:  /s/ Christian Berry              /s/ David Buettner
                       Name: Christian Berry            David Buettner
                       Title: Assistant Vice President  Assistant Vice President

                  Commitment Amount:

                  $60,000,000

                  Lending Office (all Types of Loans):

                  Commerzbank AG, New York Branch
                  2 World Financial Center
                  New York, New York  10281
                  Attn:  Douglas P. Traynor
                  Telecopier:       212-266-7565
                  Telephone:        212-266-7569

                       [Signatures Continued on Next Page]

                                     -100-
<PAGE>

                 [Signature Page to Credit Agreement dated as of
                   April 30, 2001 with HRPT Properties Trust]

                              THE BANK OF NEW YORK

                              By:  /s/ David V. Fowler
                                   Name:  David V. Fowler
                                   Title:  Vice President

                              Commitment Amount:

                              $35,000,000

                              Lending Office (all Types of Loans):

                              The Bank of New York
                              One Wall Street, 21st Floor
                              New York, New York  10286
                              Attn:  David V. Fowler
                              Telecopier:       212-809-9526
                              Telephone:        212-635-8113

                       [Signatures Continued on Next Page]

                                     -101-
<PAGE>

                 [Signature Page to Credit Agreement dated as of
                   April 30, 2001 with HRPT Properties Trust]

                             AMSOUTH BANK

                             By:  /s/ Katherine M. Allen
                                  Name: Katherine M. Allen
                                  Title: Vice President

                             Commitment Amount:

                             $25,000,000

                             Lending Office (all Types of Loans):

                             AmSouth Bank
                             1900 5th Avenue North, 9th Floor
                             Birmingham, AL  35203
                             Attn:  Crystal Cassels
                             Telecopier:       205-326-4075
                             Telephone:        205-801-0622

                       [Signatures Continued on Next Page]

                                     -102-
<PAGE>

                 [Signature Page to Credit Agreement dated as of
                   April 30, 2001 with HRPT Properties Trust]

                             CITIZENS BANK OF MASSACHUSETTS

                             By:  /s/ Daniel R. Ouellette
                                  Name:  Daniel R. Ouellette
                                  Title:  Senior Vice President

                             Commitment Amount:

                             $25,000,000

                             Lending Office (all Types of Loans):

                             Citizens Bank
                             28 State Street, 14th Floor
                             Boston, Massachusetts 02109
                             Attn: Daniel R. Ouellette
                             Telecopier:       617-725-5695
                             Telephone:        617-725-5602

                       [Signatures Continued on Next Page]

                                     -103-
<PAGE>

                 [Signature Page to Credit Agreement dated as of
                   April 30, 2001 with HRPT Properties Trust]

                                            SUNTRUST BANK

                             By:  /s/ Blake K. Thompson
                                  Name: Blake K. Thompson
                                  Title: Vice President

                             Commitment Amount:

                             $20,000,000

                             Lending Office (all Types of Loans):

                             SunTrust Bank
                             8245 Boone Blvd
                             Suite 820
                             Vienna VA  22182
                             Attn:  Glenda Charles
                             Telecopier:       703-902-9245/9190
                             Telephone:        703-902-9183

                       [Signatures Continued on Next Page]

                                     -104-
<PAGE>

                 [Signature Page to Credit Agreement dated as of
                   April 30, 2001 with HRPT Properties Trust]

                             THE GOVERNOR AND COMPANY OF THE BANK OF IRELAND

                             By:  /s/ Niamh O'Flynn
                                  Name:  Niamh O'Flynn
                                  Title:  Manager

                             By:  /s/Kieran Rockett
                                  Name:  Kieran Rockett
                                  Title:  Authorised Signatory

                             Commitment Amount:

                             $15,000,000

                             Lending Office (all Types of Loans):

                             The Governor and Company of the Bank of Ireland
                             LaTouche House
                             International Financial Services Centre
                             Dublin 1, Ireland
                             Attn:  Niamh O'Flynn
                             Telecopier:       011-353-1-8290129
                             Telephone:        011-353-1-6093491

                       [Signatures Continued on Next Page]

                                     -105-
<PAGE>
                 [Signature Page to Credit Agreement dated as of
                   April 30, 2001 with HRPT Properties Trust]

                             CHEVY CHASE BANK

                             By:  /s/ Eric A. Lawrence
                                  Name:  Eric A. Lawrence
                                  Title:  Vice President

                             Commitment Amount:

                             $15,000,000

                             Lending Office (all Types of Loans):

                             Chevy Chase Bank
                             8401 Connecticut Avenue
                             Chevy Chase MD  20815
                             Attn:  Eric A. Lawrence
                             Telecopier:       301-986-7516
                             Telephone:        301-986-7216

                       [Signatures Continued on Next Page]

                                     -106-
<PAGE>

                 [Signature Page to Credit Agreement dated as of
                   April 30, 2001 with HRPT Properties Trust]

                             EASTERN BANK

                             By:  /s/ Richard C. Muraida
                                  Name: Richard C. Muraida
                                  Title: Vice President

                             Commitment Amount:

                             $12,000,000

                             Lending Office (all Types of Loans):

                             Eastern Bank
                             53 State Street, 13th Floor
                             Boston MA  02109
                             Attn:  Richard Muraida
                             Telecopier:       617-263-2522
                             Telephone:        617-263-2458

                       [Signatures Continued on Next Page]

                                     -107-
<PAGE>

                 [Signature Page to Credit Agreement dated as of
                   April 30, 2001 with HRPT Properties Trust]

                             NATIONAL BANK OF EGYPT, NEW YORK BRANCH

                             By:  /s/ Carmelo L. Foti
                                  Name: Carmelo L. Foti
                                  Title: Vice President

                             By:  /s/ Rami El-Rifai
                                  Name: Rami El-Rifai
                                  Title: Assistant Vice President

                             Commitment Amount:

                             $10,000,000

                             Lending Office (all Types of Loans):

                             Nation Bank of Egypt
                             New York Branch
                             40 East 52nd Street
                             New York, New York 10022
                             Attn: Vernon Hatton
                             Telecopier:       212-755-6944
                             Telephone:        212-326-8000

                       [Signatures Continued on Next Page]

                                     -108-
<PAGE>

                 [Signature Page to Credit Agreement dated as of
                   April 30, 2001 with HRPT Properties Trust]

                             RZB FINANCE LLC

                             By:  /s/John A. Valiska
                                  Name:  John A. Valiska
                                  Title:  Vice President

                             By:  /s/ Pearl Geffers
                                  Name:  Pearl Geffers
                                  Title:  Firs Vice President

                             Commitment Amount:

                             $10,000,000

                             Lending Office (all Types of Loans):

                             RZB Finance LLC
                             1133 Avenue of the Americas - 16th Floor
                             New York, New York 10030
                             Attn: Peter Siggia
                             Telecopier:       (212) 391-9670
                             Telephone:        (212) 845-8340

                       [Signatures Continued on Next Page]

                                     -109-
<PAGE>

                 [Signature Page to Credit Agreement dated as of
                   April 30, 2001 with HRPT Properties Trust]

                             BANK LEUMI USA

                             By:  /s/ Charles C. D'Amico
                                  Name: Charles C. D'Amico
                                  Title: Vice President

                             Commitment Amount:

                             $5,000,000

                             Lending Office (all Types of Loans):

                             Bank Leumi USA
                             562 Fifth Avenue
                             New York NY  10036
                             Attn:  Charles C. D'Amico
                             Telecopier:       212-626-1239
                             Telephone:        212-626-1220

                                     -110-
<PAGE>

                                 SCHEDULE 1.1(A)

                              List of Loan Parties

1735 Market Street Properties Trust
Causeway Holdings, Inc.
Health and Retirement Properties International, Inc.
Hub Acquisition Trust
Hub LA Properties Trust
Hub Management, Inc.
Hub Properties Trust
Hub Realty College Park I, LLC
Hub Realty College Park, Inc.
Hub Realty Funding, Inc.
Hub Realty Golden, Inc.
Hub Realty Kansas City, Inc.
Hub RI Properties Trust
Hub Woodmont Investment Trust
Hub Woodmont Limited Liability Company
Indemnity Collection Corporation
Nine Penn Center Properties Trust
Research Park Properties Trust
Rosedale Properties Trust
HRPT Medical Buildings Realty Trust
47 Harvard Street Real Estate Trust
145 University Avenue Realty Trust
MOB Realty Trust
4 Maguire Road Realty Trust
Putnam Place Realty Trust
Hub MA Realty Trust
Hub LA Limited Partnership
Nine Penn Center Associates, L.P.

<PAGE>

                                 SCHEDULE 6.1(b)

                               Ownership Structure

Part I (Subsidiaries)

Causeway Holdings, Inc. - (Massachusetts)
         HRPT Properties Trust owns 100 shares of common stock, $.01 par value,
         representing 100% ownership.

Health and Retirement Properties International, Inc. - (Delaware)
         HRPT Properties Trust owns 100 shares of common stock, $.01 par value,
         representing 100% ownership.

Hub Realty Golden, Inc. - (Delaware)
         Hub  Acquisition  Trust owns 1 share of common  stock,  $.01 par value,
         representing 100% ownership.

Hub Realty Kansas City, Inc. - (Delaware)
         Hub  Acquisition  Trust owns 1 share of common  stock,  $.01 par value,
         representing 100% ownership.

Hub RI Properties Trust - (Maryland)
         HRPT Properties  Trust owns 1,000 shares of beneficial  interest,  $.01
         par value, representing 100% ownership.

Hub Woodmont Investment Trust - (Maryland)
         Hub Properties Trust owns 100 shares of beneficial  interest,  $.01 par
         value, representing 100% ownership interest.

Hub Woodmont Limited Liability Company - (Delaware)
         Hub  Woodmont  Investment  Trust -  $9,000,000  capital  account  - 99%
         ownership  Blackridge  Woodmont  LLC -  $320,500  capital  account - 1%
         ownership

Indemnity Collection Corporation - (Delaware)
         HRPT Properties Trust owns 100 shares of common stock,  $.01 par value,
         representing 100% ownership.

<PAGE>

Rosedale Properties Trust - (Maryland)
         Hub Properties Trust owns 1,000 shares of beneficial interest, $.01 par
         value, representing 100% ownership.

47 Harvard Street Real Estate Trust  (Nominee Trust - Massachusetts)
         Hub Properties Trust is the 100% beneficiary.

145 University Avenue Realty Trust  (Nominee Trust - Massachusetts)
         Hub Properties Trust is the 100% beneficiary.

4 Maguire Road Realty Trust  (Nominee Trust - Massachusetts)
         Hub Properties Trust is the 100% beneficiary.

Putnam Place Realty Trust (Nominee Trust - Massachusetts)
         Hub Properties Trust is the 100% beneficiary.

Hub MA Realty Trust (Nominee Trust - Massachusetts)
         Hub Properties Trust is the 100% beneficiary.

Hub Realty College Park I, LLC - (Maryland)
         Hub Management, Inc. - 50% membership interest.
         Hub Realty College Park, Inc. - 50% membership interest.

Hub Management, Inc. - (Delaware)
         Hub  Acquisition  Trust owns  1,000  shares of common  stock,  $.01 par
         value, representing 100% ownership.

Hub Realty College Park, Inc. - (Delaware)
         Hub  Acquisition  Trust owns 1 share of common  stock,  $.01 par value,
         representing 100% ownership.

Material Subsidiaries

1735 Market Street Properties Trust - (Maryland)
         Hub Properties Trust owns 100 shares of beneficial  interest,  $.01 par
         value, representing 100% ownership.
<PAGE>

Hub Acquisition Trust  - (Maryland)
         HRPT Properties  Trust owns 1,000 shares of beneficial  interest,  $.01
         par value, representing 100% ownership.

Hub LA Properties Trust - (Maryland)
         Hub Properties Trust owns 1,000 shares of beneficial interest, $.01 par
         value, representing 100% ownership.

Hub Properties Trust - (Maryland)
         HRPT Properties  Trust owns 1,000 shares of beneficial  interest,  $.01
         par value, representing 100% ownership.

Hub Realty Funding, Inc.- (Delaware)
         Hub  Acquisition  Trust owns 1 share of common  stock,  $.01 par value,
         representing 100% ownership.

Nine Penn Center Properties Trust - (Maryland)
         Hub Properties Trust owns 100 shares of beneficial  interest,  $.01 par
         value, representing 100% ownership.

Research Park Properties Trust - (Maryland)
         HRPT Properties Trust owns 100 shares of beneficial interest,  $.01 par
         value, representing 100% ownership.

HRPT Medical Buildings Realty Trust (Nominee Trust - Massachusetts)
         Hub Properties Trust is the 100% beneficiary.

MOB Realty Trust (Nominee Trust - Massachusetts)
         Hub Properties Trust is the 100% beneficiary.

Hub LA Limited Partnership (98%) - (Delaware)
         Hub Properties Trust - 98% ownership interest
         Hub LA Properties Trust - 1% ownership interest
         Medical Office Buildings Limited - 1% ownership interest

<PAGE>

Nine Penn Center Associates, L.P. - (Pennsylvania)
         Hub Properties Trust - 88% ownership interest.
         Nine Penn Center Properties Trust - 1% ownership interest.
         Transportation Associates - 11% ownership interest.

Excluded Subsidiaries

Rosedale Properties, Inc. - (Delaware)
         Rosedale  Properties  Trust owns 100 shares of common  stock,  $.01 par
         value, representing 100% ownership.

Quarry Lake Properties Trust - (Maryland)
         Hub Properties  Trust owns 1,000 common shares of beneficial  interest,
         $.01 par value, representing 100% ownership.

Hub Realty Richland, Inc. - (Delaware)
         Hub  Acquisition  Trust owns 1 share of common  stock,  $.01 par value,
         representing 100% ownership.

Hub Realty Buffalo, Inc. - (Delaware)
         Hub  Acquisition  Trust owns 1 share of common  stock,  $.01 par value,
         representing 100% ownership.

Rosedale Properties Limited Liability Company - (Delaware)
         Hub Properties Trust - 99%
         Rosedale Properties, Inc. - 1%

Park San Antonio Properties Trust - (Maryland)
         Hub Properties Trust owns 1,000 shares of beneficial interest, $.01 par
         value, representing 100% ownership.

Cedars LA LLC - (Delaware)
         Hub LA Limited Partnership - 100% ownership interest

SP Holding Property Trust - (Maryland)
         Hub Properties Trust - 100%

<PAGE>

Franklin Plaza Property Trust - (Maryland)
         SP Holding Property Trust - 100%

Lakewood Property Trust - (Maryland)
         SP Holding Property Trust - 100% ownership interest

Herald Square LLC - (Delaware)
         SP Holding Property Trust - 100% ownership interest

Indiana Avenue LLC - (Delaware)
         SP Holding Property Trust - 100% ownership interest

Bridgepoint Property Trust - (Maryland)
         SP Holding Property Trust - 100% ownership interest

1600 Market Street Property Trust - (Maryland)
         SP Holding Property Trust - 100% ownership interest

Rosedale Corporate Plaza Condominium, Inc. - (Minnesota)
         Rosedale Properties LLC owns 5 condo units representing 89% ownership.
         Servico Roseville, Inc. owns 1 condo unit representing 11% ownership.]

Part II (Unconsolidated Affiliates)

<PAGE>

<TABLE>
<CAPTION>

                                 SCHEDULE 6.1(f)

                           Title To Properties; Liens

Part I (Real Property)

            Owner                                     Property                              City                  State
            -----                                     --------                              ----                  -----
<S>                                          <C>                                       <C>                          <C>
Hub Acquisition Trust                         4560 Viewridge Avenue                     San Diego                    CA
Hub Acquisition Trust                         55 North Robinson                         Oklahoma City                OK
Hub Acquisition Trust                         2029 Stonewall Jackson Dr.                Falling Waters               WV
Hub Acquisition Trust                         5051 Rodeo Road                           Los Angeles                  CA
Hub Acquisition Trust                         330 Second Avenue                         Minneapolis                  MN
Hub Acquisition Trust                         701 Clay Street                           Waco                         TX
Hub Acquisition Trust                         4181 Ruffin Road                          San Diego                    CA
Hub Realty Buffalo, Inc.                      130-138 Delaware Avenue                   Buffalo                      NY
Hub Realty Golden, Inc.                       16194 West 45th Street                    Golden                       CO
Hub Realty College Park I,                    4700 River Road                           Riverdale                    MD
   LLC
Hub Realty Kansas City, Inc.                  4241 N.E. 34th Street                     Kansas City                  MO
Hub Realty Funding, Inc.                      25 Twelfth Street                         Petersburg                   AK
Hub Realty Funding, Inc.                      711 14th Avenue                           Safford                      AZ
Hub Realty Funding, Inc.                      220 E. Bryan Street                       Savannah                     GA
Hub Realty Funding, Inc.                      435 Montano Boulevard                     Albuquerque                  NM
Hub Realty Funding, Inc.                      9797 Aero Drive                           San Diego                    CA
Hub Realty Funding, Inc.                      5353 North Yellowstone Dr.                Cheyenne                     WY
Hub Realty Funding, Inc.                      1474 Rodeo Road                           Sante Fe                     NM
Hub Realty Funding, Inc.                      820 West Diamond Avenue                   Gaithersburg                 MD
Hub Realty Funding, Inc.                      20400 Century Boulevard                   Germantown                   MD
Hub Realty Funding, Inc.                      6710 Oxon Hill Drive                      Oxon Hill                    MD
Hub Realty Funding, Inc.                      5600 Columbia Pike                        Falls Church                 VA
Hub Realty Funding, Inc.                      20 Massachusetts Avenue                   Washington                   DC
Hub Realty Funding, Inc.                      625 Indiana Avenue                        Washington                   DC
Hub Realty Funding, Inc.                      400 State Avenue                          Kansas City                  KS
Hub Realty Funding, Inc.                      201 Indianola Avenue                      Phoenix                      AZ
Hub Realty Funding, Inc.                      3285 E. Hemisphere Loop                   Tucson                       AZ
Hub Realty Richland, Inc.                     2420 & 2430 Stevens Ctr Pl                Richland                     WA
Causeway Holdings, Inc.                       251 Causeway Street                       Boston                       MA
Hub Woodmont Limited                          1401 Rockville Pike-Wdmt                  Rockville                    MD
   Liability Company
Cedars LA LLC                                 8631 West Third Avenue                    Los Angeles                  CA
                                                 (2 buildings)
Lakewood Property Trust                       7600 Capital of Texas                     Austin                       TX
                                                 Highway
</TABLE>

<PAGE>
<TABLE>
<CAPTION>

            Owner                                     Property                              City                  State
            -----                                     --------                              ----                  -----
<S>                                          <C>                                       <C>                          <C>

Hub RI Properties Trust                       701 George Washington Hw                  Lincoln                      RI
Park San Antonio Properties                   812 San Antonio Park                      Austin                       TX
   Trust
Research Park Properties                      Research Park                             Austin                       TX
   Trust                                         (includes Solectron Expan.)
Research Park Properties                      Research Park - Phase II                  Austin                       TX
   Trust
Research Park Properties                      Research Park - Land                      Austin                       TX
   Trust
Rosedale Properties Limited                   2665 Long Lake Road                       Roseville                    MN
   Liability Company
Hub Properties Trust                          1145 19th Street NW                       Washington                   DC
Hub Properties Trust                          One Franklin Plaza                        Philadelphia                 PA
Hub Properties Trust                          1250 H. Street N.W.                       Washington                   DC
Hub Properties Trust                          4001 Fair Ridge Drive                     Fairfax                      VA
Hub Properties Trust                          3030, 3040 and 3050                       San Diego                    CA
                                                 Sci Pk. Rd.
Hub Properties Trust                          5555, 5601, 5626 and                      San Diego                    CA
                                              5627 Oberlin Drive
Hub Properties Trust                          443 Gulph Road                            King of Prussia              PA
Hub Properties Trust                          1035 Virginia Drive                       Ft. Washington               PA
Hub Properties Trust                          515 Penn Ave.                             Ft. Washington               PA
Hub Properties Trust                          525 Virginia Drive                        Ft. Washington               PA
Hub Properties Trust                          723 Drescher Road                         Horsham                      PA
Hub Properties Trust                          830 E. Potomac Circle                     Aurora                       CO
Hub Properties Trust                          100 South Charles St.,                    Baltimore                    MD
                                                 Tower II
Hub Properties Trust                          710 North Euclid,                         Anaheim                      CA
                                                 Bldg. 1 of 3
Hub Properties Trust                          1085 North Harbor,                        Anaheim                      CA
                                                 Bldg. 3 of 3
Hub Properties Trust                          2141 K St., N.W.                          Washington                   DC
Hub Properties Trust                          3043 Walton Road                          Plymouth Meeting             PA
Hub Properties Trust                          475 Virginia Drive                        Ft. Washington               PA
Hub Properties Trust                          6937 NIH - Founders Bldg.                 Austin                       TX
Hub Properties Trust                          216 Mall Boulevard                        King of Prussia              PA
Hub Properties Trust                          210 Mall Boulevard                        King of Prussia              PA
Hub Properties Trust                          1911 Mills Avenue                         Orlando                      FL
Hub Properties Trust                          1825 Mills Avenue                         Orlando                      FL
Hub Properties Trust                          1925 N. Mills Avenue                      Orlando                      FL
Hub Properties Trust                          5750 Centre Avenue                        Pittsburgh                   PA
Hub Properties Trust                          1305 Corp. Ctr. Dr.-I/Shop                Eagan                        MN
</TABLE>

<PAGE>
<TABLE>
<CAPTION>

            Owner                                     Property                              City                  State
            -----                                     --------                              ----                  -----
<S>                                          <C>                                       <C>                          <C>
Hub Properties Trust                          2250 Pilot Knob Rd.-I/Shop                Mendota Heights              MN
Hub Properties Trust                          4421 W. John Carpenter                    Irving                       TX
                                                 Fw-I/Shop
Hub Properties Trust                          4770 Regent Blvd.-I/Shop                  Irving                       TX
Hub Properties Trust                          8880 Queen Ave.-I/Shop                    Bloomington                  MN
Hub Properties Trust                          2100 NW 82nd Ave.-I/Shop                  Miami                        FL
Hub Properties Trust                          1111 W. 34th Street                       Austin                       TX
Hub Properties Trust                          1600 Market Street                        Philadelphia                 PA
Hub Properties Trust                          Vorhees Ctr., 333 Laurel Oak              Vorhees                      NJ
Hub Properties Trust                          Vorhees Ctr., 400 Laurel Oak              Vorhees                      NJ
Hub Properties Trust                          Vorhees Ctr., 1000 Vorhees                Vorhees                      NJ
Hub Properties Trust                          35 Thorpe Ave.                            Wallingford                  CT
Hub Properties Trust                          Donahue Road                              Greenberg                    PA
Hub Properties Trust                          5300 Kings Island Drive                   Mason                        OH
Hub Properties Trust                          1534 Ridge Road East                      Irondequoit                  NY
Hub Properties Trust                          6818 Austin Center Blvd.                  Austin                       TX
Hub Properties Trust                          802 Delaware Ave.                         Wilmington                   DE
Hub Properties Trust                          7-9 Vreeland Road                         Florham Park                 NJ
Hub Properties Trust                          3330 North Washington                     Arlington                    VA
                                                 Blvd.
Hub Properties Trust                          200 Jefferson Ave.                        Memphis                      TN
Hub Properties Trust                          700 Cherington Parkway                    Pittsburgh                   PA
Hub Properties Trust                          Metro Exec. Ctr.,                         Baltimore                    MD
                                                 4201 Patterson
Hub Properties Trust                          580 Virginia Drive                        Ft. Washington               PA
Hub Properties Trust                          801 Barnes Road                           Wallingford                  CT
Hub Properties Trust                          2800 Eisenhower Drive                     Alexandria                   VA
Hub Properties Trust                          3000 Goffs Falls Road                     Manchester                   NH
Hub Properties Trust                          1601 Rio Grande                           Austin                       TX
Hub Properties Trust                          1525 Locust Street                        Philadelphia                 PA
Hub Properties Trust                          One Suffolk Square                        Islandia                     NY
Hub Properties Trust                          The Pavillion                             Mineola                      NY
                                              200 Old County Road
Hub Properties Trust                          110 W. Fayette Street                     Syracuse                     NY
Hub Properties Trust                          7800 Shoal Creek                          Austin                       TX
Hub Properties Trust                          1920 & 1930                               Tempe                        AZ
                                              University Drive
Hub Properties Trust                          1001 Jefferson Plaza                      Wilmington                   DE
Hub Properties Trust                          Two Corporate Center Drive                Melville                     NY
Hub Properties Trust                          2444 West Las                             Phoenix                      AZ
                                              Palmerita Drive
Hub Properties Trust                          3737 Broadway                             San Antonio                  TX
Hub Properties Trust                          8701 North Mopac                          Austin                       TX
</TABLE>

<PAGE>
<TABLE>
<CAPTION>

            Owner                                     Property                              City                  State
            -----                                     --------                              ----                  -----
<S>                                          <C>                                       <C>                          <C>
Hub Properties Trust                          7100 Northland Circle                     Brooklyn Park                MN
Hub Properties Trust                          1000 Shelard Parkway                      St. Louis Park               MN
Hub Properties Trust                          4516 Seton Center Park                    Plymouth                     MN
Hub Properties Trust                          525 Park Street                           St. Paul                     MN
Hub Properties Trust                          4000 Old Court Road                       Pikesville                   MD
Hub Properties Trust                          701 NE 10th Street                        Oklahoma City                OK
Hub Properties Trust                          8315 So. Walker Avenue                    Oklahoma City                OK
Hub Properties Trust                          200 N. Bryant                             Edmond                       OK
Hub Properties Trust                          201 N. Garrett                            Elk City                     OK
Hub Properties Trust                          600 National Avenue                       Midwest City                 OK
Hub Properties Trust                          200-625 Corporate Center                  Moon Township                PA
                                                 (6 Bldgs.)
Hub Properties Trust                          1801 Randolph Road S.E.                   Albuquerque                  NM
                                                 (4 Bldgs.)
Hub Properties Trust                          960 Harvest Drive (3 Bldgs.)              Blue Bell                    PA
Hub Properties Trust                          251 Salina Meadows                        Syracuse                     NY
                                                 Parkway
Hub Properties Trust                          14026 and 14030                           Chantilly                    VA
                                                 Thunderbolt
Hub Properties Trust                          9800 Shelard Parkway                      Austin                       TX
Hub Properties Trust                          3840 South Wadsworth Blvd.                Lakewood                     CO
Hub Properties Trust                          5790 Widewaters Parkway                   DeWitt                       NY
Quarry Lake Properties Trust                  4545 Seton Center Park                    Austin                       TX
Bridgepoint Property Trust                    6300 Bridgepoint Pkwy                     Austin                       TX
                                                 (5 Bldgs)
Nine Penn Center Associates                   1735 Market Street                        Philadelphia                 PA
   L.P.
HRPT Medical Buildings                        1295 Boylston Street                      Boston                       MA
   Realty Trust
HRPT Medical Buildings                        109 Brookline Avenue                      Boston                       MA
   Realty Trust
47 Harvard Street Real Estate                 47 Harvard Street                         Westwood                     MA
   Trust
University Avenue Real                        145 University Avenue                     Westwood                     MA
   Estate Trust
MOB Realty Trust                              35 Milbury Street                         Auburn                       MA
MOB Realty Trust                              Cady Brook Plaza                          Charlton                     MA
MOB Realty Trust                              370 Lunenburg Street                      Fitchburg                    MA
MOB Realty Trust                              28 Grafton Common                         Worcester                    MA
MOB Realty Trust                              165 Mill Street                           Leominster                   MA
MOB Realty Trust                              108 Elm Street                            Worcester                    MA
MOB Realty Trust                              176 West Street                           Worcester                    MA
MOB Realty Trust                              338 Church Street                         Worcester                    MA
MOB Realty Trust                              715 Pleasant Street                       Worcester                    MA
</TABLE>

<PAGE>
<TABLE>
<CAPTION>

            Owner                                     Property                              City                  State
            -----                                     --------                              ----                  -----
<S>                                          <C>                                       <C>                          <C>

MOB Realty Trust                              405-407 Main Street                       Worcester                    MA
MOB Realty Trust                              67 Hall Road                              Worcester                    MA
MOB Realty Trust                              340 Thompson Road                         Worcester                    MA
MOB Realty Trust                              106 East Main Street                      Worcester                    MA
MOB Realty Trust                              112 East Main Street                      Worcester                    MA
MOB Realty Trust                              135 Gold Star Blvd.                       Worcester                    MA
MOB Realty Trust                              191 May Street                            Worcester                    MA
MOB Realty Trust                              277 E. Mountain Street                    Worcester                    MA
MOB Realty Trust                              425 N. Lake Avenue                        Worcester                    MA
MOB Realty Trust                              630 Plantation Street                     Worcester                    MA
MOB Realty Trust                              95 Lincoln Street                         Worcester                    MA
4 Maguire Road Realty Trust                   4 Maguire Road                            Lexington                    MA
Putnam Place Realty Trust                     859 Willard Street                        Quincy                       MA
Putnam Place Realty Trust                     19-23 Granite Street                      Braintree                    MA
Hub MA Realty Trust                           165 University Avenue                     Westwood                     MA
HRPT Properties Trust                         15 No. Broadway                           White Plains                 NY
HRPT Properties Trust                         6300 Eighth Avenue                        Brooklyn                     NY
</TABLE>

Part II (Permitted Liens)

1.       Mortgage by Hub Realty Buffalo, Inc. to and for the benefit of M&T Real
         Estate,  Inc.  for the  property  located  at  130-138  Delaware  Ave.,
         Buffalo, New York.

2.       Mortgage  by Hub  Realty  Richland,  Inc.  to and  for the  benefit  of
         Canadian Imperial Bank of Commerce for the property located at 2420 and
         2430 Stevens Center Plaza, Richland, Wisconsin.

3.       Open-End Leasehold Mortgage,  Assignment of Leases and Rents,  Security
         Agreement and Fixture Filing, dated December 15, 2000, made by Franklin
         Plaza Property Trust,  as Mortgagor,  to and for the benefit of Merrill
         Lynch Mortgage Lending,  Inc., as Mortgagee for the property located at
         One Franklin Plaza, Philadelphia, Pennsylvania.

4.       Deed of Trust,  Assignment of Leases and Rents,  Security Agreement and
         Fixture  Filing,  dated  December  15,  2000,  made by Cedars LA LLC to
         Lawyers  Title  Borrower  for the  benefit  of Merrill  Lynch  Mortgage
         Lending,  Inc. for the property located at 8631 West Third Avenue,  Los
         Angeles, California.

5.       Loan and Security  Agreement,  dated  December 15, 2000, by and between
         Cedars LA LLC,  Herald  Square  LLC,  Indiana  Avenue  LLC,  Bridgeport
         Property Trust, Lakewood Property Trust and 1600 Market Street Property
         Trust,  collectively as Borrowers,  and Merrill Lynch Mortgage Lending,
         Inc., as Lender.
<PAGE>

6.       Deed of Trust,  Assignment of Leases and Rents,  Security Agreement and
         Fixture  Filing,  dated  December 15, 2000,  made by Lakewood  Property
         Trust in favor of William  Z.  Fairbanks,  Jr.  and for the  benefit of
         Merrill Lynch Mortgage  Lending,  Inc. for the property located at 7600
         Capital of Texas Highway, Austin, Texas.

7.       Mortgage by Park San Antonio Properties Trust to and for the benefit of
         First Union  National Bank for the property  located at 812 San Antonio
         Park, Austin, Texas.

8.       Deed of Trust,  Assignment of Leases and Rents,  Security Agreement and
         Fixture  Filing,  dated December 15, 2000, made by Herald Square LLC to
         Lawyers  Title Realty  Services,  Inc. for the benefit of Merrill Lynch
         Mortgage Lending, Inc. for the property located at 1250 H. Street N.W.,
         Washington, D.C.

9.       Mortgage  by  Rosedale  Properties  LLC to and for the  benefit  of DLJ
         Commercial  Corp.  for the  property  located  at 2665 Long Lake  Road,
         Roseville, Minnesota.

10.      Mortgage  by Quarry  Lake  Properties  Trust to and for the  benefit of
         Teachers Insurance and Annuity  Association of America for the property
         located at 4545 Seton Center Park, Austin, Texas.

11.      Deed of Trust,  Assignment of Leases and Rents,  Security Agreement and
         Fixture Filing,  dated December 15, 2000, made by Bridgepoint  Property
         Trust in favor of William  Z.  Fairbanks,  Jr.  and for the  benefit of
         Merrill Lynch Mortgage  Lending,  Inc. for the property located at 6300
         Bridgepoint Parkway, Austin, Texas.

12.      Deed of Trust,  Assignment of Leases and Rents,  Security Agreement and
         Fixture Filing,  dated December 15, 2000, made by Indiana Avenue LLC to
         Lawyers  Title Realty  Services,  Inc. for the benefit of Merrill Lynch
         Mortgage Lending,  Inc. for the property located at 625 Indiana Avenue,
         Washington, D.C.

13       Open-End Leasehold Mortgage,  Assignment of Leases and Rents,  Security
         Agreement and Fixture  Filing,  dated  December 15, 2000,  made by 1600
         Market Street Property  Trust, as Mortgagor,  to and for the benefit of
         Merrill Lynch Mortgage  Lending,  Inc., as Mortgagee.  for the property
         located at 1600 Market Street, Philadelphia, Pennsylvania.

14.      Loan and Security  Agreement,  dated December 15, 2000, entered into by
         and between  Franklin  Plaza  Property  Trust,  as Borrower and Merrill
         Lynch Mortgage Lending, Inc., as Lender.

<PAGE>

                                 SCHEDULE 6.1(g)

                           Indebtedness and Guaranties

1.       Indenture, dated July 9, 1997, by and between Borrower and State Street
         Bank and Trust Company, as Trustee (Unsecured)

2.       Supplemental  Indenture No. 3, dated  February 23, 1998, by and between
         Borrower  and State  Street Bank and Trust  Company,  relating to 6.70%
         Senior Notes due 2005 (Unsecured) ($100,000,000)

3.       Supplemental  Indenture  No. 4, dated August 26,  1998,  by and between
         Borrower  and State Street Bank and Trust  Company,  relating to 6.875%
         Senior Notes due 2002 (Unsecured) ($160,000,000)

4.       Supplemental  Indenture No. 5, dated  November 30, 1998, by and between
         Borrower  and State  Street  Bank and Trust  Company,  relating to 8.5%
         Monthly Notes due 2013 (Unsecured) ($143,000,000)

5.       Supplemental  Indenture  No. 6, dated  March 24,  1999,  by and between
         Borrower  and State Street Bank and Trust  Company,  relating to 7.875%
         Monthly Notes due 2009 (Unsecured) ($90,000,000)

6.       Supplemental  Indenture  No. 7, dated  June 17,  1999,  by and  between
         Borrower  and State Street Bank and Trust  Company,  relating to 8.375%
         Senior Notes due 2011 (Unsecured) ($65,000,000)

7.       Supplemental  Indenture  No. 8, dated  July 31,  2000,  by and  between
         Borrower  and State Street Bank and Trust  Company,  relating to 8.875%
         Senior Notes due 2010 (Unsecured) ($30,000,000)

8.       Supplemental  Indenture No. 9, dated September 29, 2000, by and between
         Borrower  and State Street Bank and Trust  Company,  relating to 8.625%
         Senior Notes due 2010 (Unsecured) ($20,000,000)

9.       Indenture,  dated as of December 18, 1997,  by and between the Borrower
         and State Street Bank and Trust Company, as Trustee (Unsecured)

10.      Supplemental  Indenture,  dated as of December 18, 1997, by and between
         the  Borrower  and State  Street  Bank and Trust  Company,  as Trustee,
         relating to the  Company's  6.75%  Senior  Notes due 2002.  (Unsecured)
         ($150,000,000)

11.      Mortgage by Hub Realty Buffalo, Inc. to and for the benefit of M&T Real
         Estate, Inc. (Secured) ($10,152,703)
<PAGE>

12.      Mortgage  by Hub  Realty  Richland,  Inc.  to and  for the  benefit  of
         Canadian Imperial Bank of Commerce. (Secured) ($11,269,850)

13.      Open-End Leasehold Mortgage,  Assignment of Leases and Rents,  Security
         Agreement and Fixture Filing, dated December 15, 2000, made by Franklin
         Plaza Property Trust,  as Mortgagor,  to and for the benefit of Merrill
         Lynch Mortgage Lending, Inc., as Mortgagee. (Secured) ($44,000,000)

14.      Deed of Trust,  Assignment of Leases and Rents,  Security Agreement and
         Fixture  Filing,  dated  December  15,  2000,  made by Cedars LA LLC to
         Lawyers  Title  Borrower  for the  benefit  of Merrill  Lynch  Mortgage
         Lending, Inc. (Secured) ($72,829,000)

15.      Loan and Security  Agreement,  dated  December 15, 2000, by and between
         Cedars LA LLC,  Herald  Square  LLC,  Indiana  Avenue  LLC,  Bridgeport
         Property Trust, Lakewood Property Trust and 1600 Market Street Property
         Trust,  collectively as Borrowers,  and Merrill Lynch Mortgage Lending,
         Inc., as Lender. (Secured)

16.      Deed of Trust,  Assignment of Leases and Rents,  Security Agreement and
         Fixture  Filing,  dated  December 15, 2000,  made by Lakewood  Property
         Trust in favor of William  Z.  Fairbanks,  Jr.  and for the  benefit of
         Merrill Lynch Mortgage Lending, Inc. (Secured) ($23,312,000)

17.      Mortgage by Park San Antonio Properties Trust to and for the benefit of
         First Union National Bank. (Secured) ($3,505,532)

18.      Deed of Trust,  Assignment of Leases and Rents,  Security Agreement and
         Fixture  Filing,  dated December 15, 2000, made by Herald Square LLC to
         Lawyers  Title Realty  Services,  Inc. for the benefit of Merrill Lynch
         Mortgage Lending, Inc. (Secured) ($32,058,000)

19.      Mortgage  by  Rosedale  Properties  LLC to and for the  benefit  of DLJ
         Commercial Corp. (Secured) ($17,501,499)

20.      Mortgage  by Quarry  Lake  Properties  Trust to and for the  benefit of
         Teachers. (Secured) ($10,933,964)

21.      Deed of Trust,  Assignment of Leases and Rents,  Security Agreement and
         Fixture Filing,  dated December 15, 2000, made by Bridgepoint  Property
         Trust in favor of William  Z.  Fairbanks,  Jr.  and for the  benefit of
         Merrill Lynch Mortgage Lending, Inc. (Secured) ($45,342,000)

22.      Deed of Trust,  Assignment of Leases and Rents,  Security Agreement and
         Fixture  Filing,  dated  December 15, 2000,  made by Indiana  Avenue to
         Lawyers  Title Realty  Services,  Inc. for the benefit of Merrill Lynch
         Mortgage Lending, Inc. (Secured) ($23,221,000)

23.      Open-End Leasehold Mortgage,  Assignment of Leases and Rents,  Security
         Agreement and Fixture  Filing,  dated  December 15, 2000,  made by 1600
         Market Street Property
<PAGE>

         Trust,  as Mortgagor,  to and for the benefit of Merrill Lynch Mortgage
         Lending, Inc., as Mortgagee. (Secured) ($62,238,000)

24.      Exceptions to Non-Recourse  Guaranty,  dated December 15, 2000, entered
         into by Hub Realty  College Park I, LLC, as Guarantor,  for the benefit
         of Merrill Lynch Mortgage Lending, Inc., as Lender, in reference to the
         $260,000,000 loan. (Secured)

25.      Exceptions to Non-Recourse  Guaranty,  dated December 15, 2000, entered
         by Hub Realty  College  Park I, LLC, as  Guarantor,  for the benefit of
         Merrill Lynch Mortgage  Lending,  Inc., as Lender,  in reference to the
         $44,000,000 loan. (Secured)

26.      Loan and Security  Agreement,  dated December 15, 2000, entered into by
         and between  Franklin  Plaza  Property  Trust,  as Borrower and Merrill
         Lynch Mortgage Lending, Inc., as Lender. (Secured)

  [Amounts stated above represent the unpaid principal balance as of 12/31/00]

<PAGE>

                                 SCHEDULE 6.1(h)

                               Material Contracts

1.       Advisory Agreement by and between REIT Management & Research,  Inc. and
         the Borrower dated as of January 1, 1998.

2.       Amendment  No. 1 to Advisory  Agreement  between the  Borrower and REIT
         Management & Research, Inc. dated as of October 12, 1999.

3.       Master  Management  Agreement  by and  between  the  Borrower  and REIT
         Management & Research, Inc., dated as of January 1, 1998.

4.       Transaction  Agreement between Senior Housing  Properties Trust and the
         Borrower, dated as of September 21, 1999.

5.       Promissory Note in the amount of $260,000,000, dated December 15, 2000,
         issued  by  Cedars LA LLC,  Herald  Square  LLC,  Indiana  Avenue  LLC,
         Bridgepoint  Property  Trust,  Lakewood  Property Trust and 1600 Market
         Street  Property  Trust,  collectively  as Borrowers,  to Merrill Lynch
         Mortgage Lending, Inc., as Lender.

6.       Promissory Note in the amount of $44,000,000,  dated December 15, 2000,
         issued by Franklin Plaza Property Trust, as Borrower,  to Merrill Lynch
         Mortgage Lending, Inc., as Lender.

7.       Agreements listed on Schedule 6.1(g).

       [Certain of the foregoing may not constitute Material Contracts but

                    are provided for informational purposes.]

<PAGE>

                                 SCHEDULE 6.1(i)

                                   Litigation

None

<PAGE>

                                 SCHEDULE 6.1(k)

                              Financial Statements

None, other than declared and unpaid  dividends on the Borrower's  common shares
of beneficial interest and preferred shares of beneficial interests.

<PAGE>
<TABLE>
<CAPTION>

                                 SCHEDULE 6.1(y)

                           List of Unencumbered Assets

Part I (Unencumbered Assets)

Street                                           City                         St.           Properties
----------------------------------------------------------------------------------------------------------
<S>                                             <C>                          <C>                <C>

Real Estate:

Sorrento Valley, Oberlin Dr                      San Diego                    CA                 4
Torrey Pines, Sci Pk Rd                          San Diego                    CA                 3
Fair Oaks                                        Fairfax                      VA                 1
1145 19th Street                                 Washington                   DC                 1
1295 Boylston Street                             Boston                       MA                 1
251 Causeway Street                              Boston                       MA                 1
109 Brookline Avenue                             Boston                       MA                 1
443 Gulph Road                                   King of Prussia              PA                 1
1035 Virginia Drive                              Ft. Washington               PA                 1
100 South Charles St, Twr II                     Baltimore                    MD                 1
2141 K St, N.W.                                  Washington                   DC                 1
3043 Walton Rd                                   Plymouth Meeting             PA                 1
475 Virginia Drive                               Ft. Washington               PA                 1
6937 N IH - Founders Bldg                        Austin                       TX                 1
216 Mall Boulevard                               King of Prussia              PA                 1
1401 Rockville Pike-Wdmt                         Rockville                    MD                 1
5750 Centre Ave                                  Pittsburgh                   PA                 1
Bailey Square                                    Austin                       TX                 1
Putnam Place                                     Quincy                       MA                 2
Mellon Bank Bldg, 1735 Mkt St                    Philadelphia                 PA                 1
Vorhees Ctr, 333 Laurel Oak                      Vorhees                      NJ                 1
Vorhees Ctr,400 Laurel Oak                       Vorhees                      NJ                 1
Vorhees Ctr, 1000 Vorhs                          Vorhees                      NJ                 1
Signature 91, 35 Thorpe Ave                      Wallingford                  CT                 1
Kings Mill Office Bldg                           Mason                        OH                 1
Kings Park                                       Irondequoit                  NY                 1
Austin Surgical Plaza                            Austin                       TX                 1
One Memphis Place                                Memphis                      TN                 1
3330 North Washington Blvd                       Arlington                    VA                 1
Research Park (includes Solectron Expan.)        Austin                       TX                 3
Research Park - Phase II                         Austin                       TX                 2
</TABLE>
<PAGE>
<TABLE>
<CAPTION>

Street                                           City                         St.           Properties
----------------------------------------------------------------------------------------------------------
<S>                                             <C>                          <C>                <C>
Research Park - Land                             Austin                       TX
700 Cherington Parkway                           Pittsburgh                   PA                 1
Metro Exec Ctr-4201 Patterson                    Baltimore                    MD                 1
580 Virginia Drive                               Ft. Washington               PA                 1
Liberty Plaza                                    Wallingford                  CT                 1
2800 Eisenhower Dr                               Alexandria                   VA                 1
Meridian Executive Park, 1601 Rio Grande         Austin                       TX                 1
1525 Locust St.                                  Philadelphia                 PA                 1
One Suffolk Square                               Islandia                     NY                 1
The Pavillion, 200 Old County Rd.                Mineola                      NY                 1
One Lincoln Center                               Syracuse                     NY                 1
Exchange Park                                    Austin                       TX                 4
Regents Center                                   Tempe                        AZ                 2
1001 Jefferson Plaza                             Wilmington                   DE                 1
Parkside Office Bldg                             San Antonio                  TX                 1
Atrium Office Centre                             Austin                       TX                 1
Quadrant Office Bldg                             Brooklyn Park                MN                 1
Superior Plaza                                   St. Louis Park               MN                 1
Willow Creek Plaza                               Plymouth                     MN                 1
Capitol Office Building                          St. Paul                     MN                 1
Old Court Medical Bldg                           Pikesville                   MD                 1
Cherrington Corporate Center                     Moon Township                PA                 6
Albuquerque Office Complex                       Albuquerque                  NM                 4
Union Meeting Corporate Center III               Blue Bell                    PA                 3
251 Salina Meadows Parkway                       Syracuse                     NY                 1
Wright I & II                                    Chantilly                    VA                 2
The Towle Building                               Minneapolis                  MN                 1
Lakeview Plaza                                   Austin                       TX                 1
3840 South Wadsworth Blvd.                       Lakewood                     CO                 2
Widewaters V                                     DeWitt                       NY                 1
145 University Avenue                            Westwood                     MA                 1
47 Harvard Street                                Westwood                     MA                 1
515 Penn Ave                                     Ft. Washington               PA                 1
525 Virginia Drive                               Ft. Washington               PA                 1
723 Drescher Road                                Horsham                      PA                 1
701 George Washington Hw                         Lincoln                      RI                 1
4 Maguire Rd                                     Lexington                    MA                 1
1305 Corp Ctr Dr-I/Shop                          Eagan                        MN                 1
2250 Pilot Knob Rd-I/Shop                        Mendota Heights              MN                 1
</TABLE>
<PAGE>
<TABLE>
<CAPTION>

Street                                           City                         St.           Properties
----------------------------------------------------------------------------------------------------------
<S>                                             <C>                          <C>                <C>
4421 W.John Carp Fw-I/Shop                       Irving                       TX                 1
4770 Regent Blvd.-I/Shop                         Irving                       TX                 1
8880 Queen Ave-I/shop                            Bloomington                  MN                 1
2100 NW 82nd Ave-I/Shop                          Miami                        FL                 1
Owens & Minor Office/Distrib                     Greenburg                    PA                 1
165 University Ave                               Westwood                     MA                 1
Chase Bldg                                       Wilmington                   DE                 1
7-9 Vreeland Road                                Florham Park                 NJ                 1
3000 Goffs Falls Road                            Manchester                   NH                 1
Two Corporate Center Drive                       Melville                     NY                 1
 2444 West Las Palmerita Drive                   Phoenix                      AZ                 1
Fallon Clinics                                                                MA                20
830 E. Potomac Circle                            Aurora                       CO                 1
710 North Euclid - bldg1 of 3                    Anaheim                      CA                 1
1085 North Harbor-bld 3of3                       Anaheim                      CA                 1
210 Mall Boulevard                               King of Prussia              PA                 1
1911 Mills Ave                                   Orlando                      FL                 1
1825 Mills Ave                                   Orlando                      FL                 1
1925 N. Mills Ave                                Orlando                      FL                 1
The Oklahoma Clinics                             Oklahoma City                OK                 5
HIP of NY                                        White Plains                 NY                 1
HIP of NY                                        Brooklyn                     NY                 1
15 Twelfth Street                                Petersburg                   AK                 1
711 14th Avenue                                  Safford                      AZ                 1
220 E. Bryan Street                              Savannah                     GA                 1
435 Montano Boulevard                            Albuquerque                  NM                 1
2029 Stonewall Jackson Dr                        Falling Waters               WV                 1
55 North Robinson                                Oklahoma City                OK                 1
4700 River Road                                  Riverdale                    MD                 1
4241 N.E. 34th Street                            Kansas City                  MO                 1
9797 Aero Drive                                  San Diego                    CA                 1
5353 North Yellowstone Dr                        Cheyenne                     WY                 1
4560 Viewridge Avenue                            San Diego                    CA                 1
1474 Rodeo Road                                  Santa Fe                     NM                 1
4181 Ruffin Road                                 San Diego                    CA                 1
820 West Diamond Avenue                          Gaithersburg                 MD                 1
20400 Century Boulevard                          Germantown                   MD                 1
6710 Oxon Hill Drive                             Oxon Hill                    MD                 1
5600 Columbia Pike                               Falls Church                 VA                 1
</TABLE>
<PAGE>
<TABLE>
<CAPTION>

Street                                           City                         St.           Properties
----------------------------------------------------------------------------------------------------------
<S>                                             <C>                          <C>                <C>
20 Massachusetts Avenue                          Washington                   DC                 1
400 State Avenue                                 Kansas City                  KS                 1
201 Indianola Avenue                             Phoenix                      AZ                 1
3285 E. Hemisphere Loop                          Tucson                       AZ                 1
5051 Rodeo Road                                  Los Angeles                  CA                 1
701 Clay Avenue                                  Waco                         Tx                 1
16194 West 45th Street                           Golden                       CO                 1
                                                 ---------------------------------------------------------
HRPT Grand Totals                                                                               163
                                                 =========================================================

</TABLE>

Part II (Unencumbered Mortgage Notes)

                          Mortgages:           Balances               Maturity
                          ---------            --------               --------

Florence                     KS                 500,000               12/31/06
RiverPark                    KS                 943,212               11/09/02
(balance at 12/31/00)
Austin                       TX               1,300,000               05/01/01
                                              ---------
                                              2,743,212

<PAGE>

                                  SCHEDULE 9.4

                              Existing Investments

1.       HPT -  4,000,000 shares (7.1%)

2.       SNH - 12,809,238 shares (49.4%)
<PAGE>

                                    EXHIBIT A

                   FORM OF ASSIGNMENT AND Acceptance AGREEMENT

         THIS ASSIGNMENT AND Acceptance AGREEMENT dated as of ___________,  200_
(the  "Agreement")  by and  among  _________________________  (the  "Assignor"),
_________________________  (the  "Assignee"),  and First Union National Bank, as
Agent (the "Agent").

         WHEREAS,  the Assignor is a Lender under that certain Credit  Agreement
dated as of April 30, 2001 (as  amended,  restated,  supplemented  or  otherwise
modified  from  time  to  time,  the  "Credit  Agreement"),  by and  among  HRPT
Properties Trust (the "Borrower"),  the financial institutions party thereto and
their assignees under Section 12.5 thereof (the  "Lenders"),  the Agent, and the
other parties thereto;

         WHEREAS,  the Assignor  desires to assign to the Assignee,  among other
things,  all  or a  portion  of  the  Assignor's  Commitment  under  the  Credit
Agreement, all on the terms and conditions set forth herein; and

         WHEREAS,  the  Agent  consents  to such  assignment  on the  terms  and
conditions set forth herein;

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

         Section 1.  Assignment.

         (a)  Subject  to the  terms and  conditions  of this  Agreement  and in
consideration of the payment to be made by the Assignee to the Assignor pursuant
to  Section  2 of  this  Agreement,  effective  as of  ____________,  200_  (the
"Assignment Date"), the Assignor hereby irrevocably sells, transfers and assigns
to the Assignee,  without recourse,  a $__________ interest (such interest being
the "Assigned  Commitment")  in and to the Assignor's  Commitment and all of the
other rights and  obligations of the Assignor under the Credit  Agreement,  such
Assignor's Revolving Note and the other Loan Documents  (representing ______% in
respect of the aggregate amount of all Lenders' Commitments),  including without
limitation,   a  principal  amount  of  outstanding  Revolving  Loans  equal  to
$_________  and all voting rights of the Assignor  associated  with the Assigned
Commitment, all rights to receive interest on such amount of Revolving Loans and
all commitment and other Fees with respect to the Assigned  Commitment and other
rights of the Assignor  under the Credit  Agreement and the other Loan Documents
with respect to the Assigned Commitment, all as if the Assignee were an original
Lender under and signatory to the Credit  Agreement having a Commitment equal to
the amount of the Assigned  Commitment.  The Assignee,  subject to the terms and
conditions  hereof,  hereby assumes all obligations of the Assignor with respect
to the Assigned  Commitment as if the Assignee were an original Lender under and
signatory  to the Credit  Agreement  having a  Commitment  equal to the Assigned
Commitment,  which obligations  shall include,  but shall not

                                      A-1
<PAGE>

be limited to, the  obligation  of the Assignor to make  Revolving  Loans to the
Borrower  with respect to the Assigned  Commitment,  the  obligation  to pay the
Agent amounts due in respect of draws under Letters of Credit as required  under
Section 2.4(i) of the Credit Agreement and the obligation to indemnify the Agent
as provided  therein (the foregoing  enumerated  obligations,  together with all
other similar  obligations  more  particularly set forth in the Credit Agreement
and the other Loan Documents, shall be referred to hereinafter, collectively, as
the "Assigned  Obligations").  [In  addition,  the Assignor  hereby  irrevocably
sells, transfers and assigns to the Assignee,  without recourse, a $____________
interest in and to the Assignor's Bid Rate Note, including without limitation, a
principal  amount of  outstanding  Bid Rate Loans  owing to the  Assignor  in an
aggregate  amount equal to $__________,  all rights to receive  interest on such
amount of Bid Rate  Loans and other  rights  of the  Assignor  under the  Credit
Agreement and the other Loan Documents with respect to such Bid Rate Loans,  all
as if the  Assignee  had  originally  made such  amount of Bid Rate Loans to the
Borrower.  The  obligations  assigned  pursuant  to  the  immediately  preceding
sentence shall constitute  Assigned  Obligations  hereunder.] The Assignor shall
have no further duties or obligations with respect to, and shall have no further
interest in, the Assigned  Obligations or the Assigned Commitment from and after
the Assignment Date.

         (b) The assignment by the Assignor to the Assignee hereunder is without
recourse to the  Assignor.  The Assignee  makes and  confirms to the Agent,  the
Assignor,  and the other  Lenders  all of the  representations,  warranties  and
covenants  of a  Lender  under  Article  XI.  of the  Credit  Agreement.  Not in
limitation of the foregoing,  the Assignee  acknowledges and agrees that, except
as set forth in Section 4 below,  the Assignor is making no  representations  or
warranties  with respect to, and the Assignee hereby releases and discharges the
Assignor  for any  responsibility  or  liability  for: (i) the present or future
solvency or financial  condition of the  Borrower,  any  Subsidiary or any other
Loan Party, (ii) any representations, warranties, statements or information made
or  furnished  by the  Borrower,  any  Subsidiary  or any  other  Loan  Party in
connection with the Credit Agreement or otherwise, (iii) the validity, efficacy,
sufficiency,  or enforceability of the Credit Agreement, any other Loan Document
or any other  document or instrument  executed in connection  therewith,  or the
collectibility  of the Assigned  Obligations,  (iv) the perfection,  priority or
validity of any Lien with  respect to any  collateral  at any time  securing the
Obligations or the Assigned  Obligations under the Notes or the Credit Agreement
and (v) the  performance or failure to perform by the Borrower or any other Loan
Party of any obligation under the Credit Agreement or any other Loan Document to
which  it  is  a  party.   Further,  the  Assignee  acknowledges  that  it  has,
independently  and  without  reliance  upon the Agent,  or on any  affiliate  or
subsidiary thereof,  the Assignor or any other Lender and based on the financial
statements  supplied by the Borrower and such other documents and information as
it has deemed appropriate, made its own credit analysis and decision to become a
Lender under the Credit Agreement.  The Assignee also acknowledges that it will,
independently  and without  reliance  upon the Agent,  the Assignor 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 the Credit Agreement or any other Loan Documents or pursuant to any
other  obligation.  Except as expressly  provided in the Credit  Agreement,  the
Agent shall have no duty or responsibility whatsoever,  either initially or on a
continuing  basis, to provide the Assignee with any credit or other  information
with  respect to the  Borrower or any other Loan Party or to notify the Assignee
of any Default or Event of Default.

                                      A-2
<PAGE>

The  Assignee  has not relied on the Agent as to any legal or factual  matter in
connection  therewith  or  in  connection  with  the  transactions  contemplated
thereunder.

         Section 2. Payment by Assignee. In consideration of the assignment made
pursuant  to  Section 1 of this  Agreement,  the  Assignee  agrees to pay to the
Assignor on the Assignment Date, an amount equal to $_________  representing (i)
the aggregate  principal  amount  outstanding of the Loans owing to the Assignor
under the Credit  Agreement and the other Loan Documents  being assigned  hereby
plus (ii) the aggregate  amount of payments  previously  made by Assignor  under
Section 2.4(j) of the Credit  Agreement which have not been repaid and which are
being assigned hereby.

         Section 3.  Payments by  Assignor.  The  Assignor  agrees to pay to the
Agent on the Assignment Date the  administration  fee, if any, payable under the
applicable provisions of the Credit Agreement.

         Section 4.  Representations  and  Warranties of Assignor.  The Assignor
hereby  represents  and warrants to the Assignee  that (a) as of the  Assignment
Date (i) the Assignor is a Lender under the Credit Agreement having a Commitment
under the Credit  Agreement [and the outstanding  principal  balance of Bid Rate
Loans owing to the Assignor] (without reduction by any assignments thereof which
have  not yet  become  effective),  equal  to  $____________  [and  $__________,
respectively],  and that the Assignor is not in default of its obligations under
the Credit Agreement;  and (ii) the outstanding balance of Revolving Loans owing
to the Assignor (without reduction by any assignments thereof which have not yet
become effective) is $____________; and (b) it is the legal and beneficial owner
of the Assigned  Commitment which is free and clear of any adverse claim created
by the Assignor.

         Section 5. Representations,  Warranties and Agreements of Assignee. The
Assignee (a) represents and warrants that it is (i) legally  authorized to enter
into this  Agreement,  (ii) an  "accredited  investor"  (as such term is used in
Regulation D of the Securities Act) and (iii) an Eligible Assignee; (b) confirms
that it has received a copy of the Credit Agreement, together with copies of the
most  recent  financial  statements  delivered  pursuant  thereto and such other
documents and information  (including  without limitation the Loan Documents) as
it has deemed  appropriate to make its own credit analysis and decision to enter
into this  Agreement;  (c) appoints and authorizes the Agent to take such action
as  contractual  representative  on its behalf and to exercise such powers under
the Loan  Documents as are delegated to the Agent by the terms thereof  together
with such powers as are reasonably  incidental  thereto;  and (d) agrees that it
will become a party to and shall be bound by the Credit  Agreement and the other
Loan Documents to which the other Lenders are a party on the Assignment Date and
will perform in accordance  therewith all of the obligations  which are required
to be performed by it as a Lender.

         Section 6.  Recording and  Acknowledgment  by the Agent.  Following the
execution of this  Agreement,  the Assignor will deliver to the Agent (a) a duly
executed copy of this  Agreement for  acknowledgment  and recording by the Agent
and  (b)  the  Assignor's   Revolving  Note  [and  Bid  Rate  Note].  Upon  such
acknowledgment  and  recording,  from and after the  Assignment  Date, the Agent
shall make all payments in respect of the interest  assigned  hereby

                                      A-3
<PAGE>

(including  payments  of  principal,  interest,  Fees and other  amounts) to the
Assignee.  The Assignor and Assignee shall make all  appropriate  adjustments in
payments  under the Credit  Agreement for periods prior to the  Assignment  Date
directly between themselves.

         Section 7. Addresses. The Assignee specifies as its address for notices
and its Lending Office for all Loans, the offices set forth below:

         Notice Address:
                                   ------------------------------------

                                   Telephone No.:
                                                 -------------
                                   Telecopy No.:
                                                -----------------------

         Lending Office:
                                   ------------------------------------

                                   Telephone No.:
                                                 -------------
                                   Telecopy No.:
                                                -----------------------

         Section  8.  Payment  Instructions.  All  payments  to be  made  to the
Assignee  under this  Agreement by the Assignor,  and all payments to be made to
the Assignee under the Credit Agreement, shall be made as provided in the Credit
Agreement in accordance with the following instructions:

                         ------------------
                         ------------------

         Section  9.  Effectiveness  of  Assignment.  This  Agreement,  and  the
assignment and assumption  contemplated herein, shall not be effective until (a)
this Agreement is executed and delivered by each of the Assignor,  the Assignee,
the Agent, and if required under Section 12.5.(d) of the Credit  Agreement,  the
Borrower,  and (b) the payment to the Assignor of the amounts,  if any, owing by
the  Assignee  pursuant  to Section 2 hereof and (c) the payment to the Agent of
the amounts,  if any, owing by the Assignor  pursuant to Section 3 hereof.  Upon
recording and  acknowledgment of this Agreement by the Agent, from and after the
Assignment  Date, (i) the Assignee shall be a party to the Credit Agreement and,
to the extent provided in this  Agreement,  have the rights and obligations of a
Lender  thereunder and (ii) the Assignor  shall,  to the extent provided in this
Agreement,  relinquish its rights (except as otherwise provided in Section 12.10
of the Credit  Agreement) and be released from its obligations  under the Credit
Agreement;  provided,  however,  that if the Assignor does not assign its entire
interest under the Loan  Documents,  it shall remain a Lender entitled to all of
the benefits and subject to all of the  obligations  thereunder  with respect to
its Commitment.

         Section 10.  Governing  Law. THIS  AGREEMENT  SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE  WITH,  THE LAWS OF THE STATE OF NEW YORK

                                      A-4
<PAGE>

APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.

         Section 11. Counterparts.  This Agreement may be executed in any number
of counterparts each of which, when taken together, shall constitute one and the
same agreement.

         Section 12.  Headings.  Section  headings have been inserted herein for
convenience only and shall not be construed to be a part hereof.

         Section 13.  Amendments;  Waivers.  This  Agreement may not be amended,
changed, waived or modified except by a writing executed by the Assignee and the
Assignor; provided, however, any amendment, waiver or consent which shall affect
the rights or duties of the Agent under this  Agreement  shall not be  effective
unless signed by the Agent.

         Section  14.  Entire  Agreement.  This  Agreement  embodies  the entire
agreement  between the  Assignor  and the  Assignee  with respect to the subject
matter hereof and supersedes  all other prior  arrangements  and  understandings
relating to the subject matter hereof.

         Section 15. Binding  Effect.  This Agreement  shall be binding upon and
inure to the benefit of the parties hereto and their  respective  successors and
permitted assigns.

         Section 16.  Definitions.  Terms not otherwise  defined herein are used
herein with the respective meanings given them in the Credit Agreement.

         [Include  this Section  only if  Borrower's  consent is required  under
Section  12.5.(d)  Section 17.  Agreements of the Borrower.  The Borrower hereby
agrees that the Assignee shall be a Lender under the Credit  Agreement  having a
Commitment  equal to the  Assigned  Commitment.  The  Borrower  agrees  that the
Assignee  shall have all of the rights and remedies of a Lender under the Credit
Agreement  and the other Loan  Documents  as if the  Assignee  were an  original
Lender under and signatory to the Credit Agreement,  including,  but not limited
to, the right of a Lender to receive  payments of principal  and  interest  with
respect to the  Assigned  Obligations,  and to the  Revolving  Loans made by the
Lenders  after the date  hereof and to  receive  the  commitment  and other Fees
payable  to the  Lenders  as  provided  in the Credit  Agreement.  Further,  the
Assignee shall be entitled to the  indemnification  provisions from the Borrower
in favor of the Lenders as provided in the Credit  Agreement  and the other Loan
Documents.  The Borrower further agrees, upon the execution and delivery of this
Agreement,  to execute in favor of the  Assignee  Notes as  required  by Section
12.5(d) of the Credit Agreement. Upon receipt by the Assignor of the amounts due
the Assignor  under Section 2, the Assignor  agrees to surrender to the Borrower
such Assignor's Notes.]

                         [Signatures on Following Pages]

                                      A-5
<PAGE>

         IN  WITNESS  WHEREOF,  the  parties  hereto  have  duly  executed  this
Assignment and Acceptance Agreement as of the date and year first written above.

                               ASSIGNOR:

                               [Name of Assignor]

                               By:
                                  -----------------------------------------
                                    Name:
                                         ----------------------------------
                                    Title:
                                          ---------------------------------

                               ASSIGNEE:

                               [Name of Assignee]

                               By:
                                  -----------------------------------------
                                    Name:
                                         ----------------------------------
                                    Title:
                                          ---------------------------------

[Include signature of the Borrower only if
   required under Section 12.5.(d) of the Credit
   Agreement]
Agreed and consented to as of the date first written above.

BORROWER:

HRPT PROPERTIES TRUST

By:
    ----------------------------------------
     Name:
          ----------------------------------
     Title:
           ---------------------------------

                                 [Signatures Continued on Following Page]

                                      A-6
<PAGE>

Accepted as of the date first written above.

AGENT:

First Union National Bank, as Agent

By:
   -----------------------------------------
      Name:
           ---------------------------------
      Title:
            --------------------------------

                                      A-7
<PAGE>
                                    EXHIBIT B

                          FORM OF designation AGREEMENT

         THIS  designation  AGREEMENT  dated  as  of  ___________,   _____  (the
"Agreement") by and among  _________________________ (the "Designating Lender"),
_________________________  (the  "Designated  Lender") and First Union  National
Bank, as Agent (the "Agent").

         WHEREAS,  the Designating  Lender is a Lender under that certain Credit
Agreement  dated as of April 30, 2001 (as  amended,  restated,  supplemented  or
otherwise modified from time to time, the "Credit Agreement"), by and among HRPT
Properties Trust (the "Borrower"),  the financial institutions party thereto and
their assignees under Section 12.5 thereof (the  "Lenders"),  the Agent, and the
other parties thereto;

         WHEREAS, pursuant to Section 12.5(e), the Designating Lender desires to
designate the Designated Lender as its "Designated  Lender" under and as defined
in the Credit Agreement; and

         WHEREAS,  the  Agent  consents  to such  designation  on the  terms and
conditions set forth herein.

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

         Section 1.  Designation.  Subject to the terms and  conditions  of this
Agreement,  the Designating  Lender hereby designates the Designated Lender, and
the Designated Lender hereby accepts such  designation,  to have a right to make
Bid Rate Loans on behalf of the  Designating  Lender pursuant to Section 2.2. of
the Credit Agreement. Any assignment by the Designating Lender to the Designated
Lender of rights to make a Bid Rate Loan  shall  only be  effective  at the time
such Bid Rate Loan is funded by the Designated  Lender.  The Designated  Lender,
subject to the terms and conditions hereof,  hereby agrees to make such accepted
Bid Rate Loans and to perform such other obligations as may be required of it as
a Designated Lender under the Credit Agreement.

         Section 2.  Designating  Lender  Not  Discharged.  Notwithstanding  the
designation of the Designated Lender hereunder,  the Designating Lender shall be
and remain  obligated  to the  Borrower,  the Agent and the Lenders for each and
every of the  obligations of the Designating  Lender and its related  Designated
Lender  with  respect to the  Credit  Agreement  and the other  Loan  Documents,
including,  without limitation,  any  indemnification  obligations under Section
11.7 of the Credit  Agreement and any sums otherwise  payable to the Borrower by
the Designated Lender.

         Section 3. No  Representations  by Designating  Lender. The Designating
Lender makes no representation or warranty and, except as set forth in Section 8
below, assumes no

                                      B-1
<PAGE>

responsibility  pursuant to this Agreement  with respect to (a) any  statements,
warranties or representations made in or in connection with any Loan Document or
the execution, legality, validity, enforceability,  genuineness,  sufficiency or
value of any Loan  Document  or any  other  instrument  and  document  furnished
pursuant thereto and (b) the financial condition of the Borrower, any Subsidiary
or any other Loan Party or the  performance or observance by the Borrower or any
other Loan Party of any of its respective obligations under any Loan Document to
which it is a party or any  other  instrument  or  document  furnished  pursuant
thereto.

         Section 4.  Representations  and  Covenants of Designated  Lender.  The
Designated Lender makes and confirms to the Agent, the Designating  Lender,  and
the other  Lenders all of the  representations,  warranties  and  covenants of a
Lender  under  Article  XI of the Credit  Agreement.  Not in  limitation  of the
foregoing,  the  Designated  Lender (a)  represents  and warrants that it (i) is
legally  authorized  to  enter  into  this  Agreement;  (ii)  is an  "accredited
investor" (as such term is used in Regulation D of the Securities Act) and (iii)
meets the requirements of a "Designated  Lender"  contained in the definition of
such term contained in the Credit Agreement; (b) confirms that it has received a
copy of the Credit Agreement,  together with copies of the most recent financial
statements  delivered  pursuant thereto and such other documents and information
(including  without  limitation the Loan Documents) as it has deemed appropriate
to make its own credit analysis and decision to enter into this  Agreement;  (c)
confirms that it has,  independently  and without reliance upon the Agent, or on
any affiliate  thereof,  the Designating Lender or any other Lender and based on
such financial statements and such other documents and information, made its own
credit  analysis  and  decision to become a  Designated  Lender under the Credit
Agreement;  (d)  appoints  and  authorizes  the  Agent to take  such  action  as
contractual  representative  on its behalf and to exercise such powers under the
Loan Documents as are delegated to the Agent by the terms thereof  together with
such powers as are reasonably  incidental  thereto;  and (e) agrees that it will
become a party to and shall be bound by the  Credit  Agreement,  the other  Loan
Documents  to which  the other  Lenders  are a party on the  Effective  Date (as
defined below) and will perform in accordance  therewith all of the  obligations
which are required to be performed by it as a Designated  Lender. The Designated
Lender also acknowledges  that it will,  independently and without reliance upon
the  Agent,  the  Designating  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 the Credit
Agreement or any Note or pursuant to any other obligation. The Designated Lender
acknowledges  and agrees  that  except as  expressly  required  under the Credit
Agreement,  the Agent shall have no duty or  responsibility  whatsoever,  either
initially or on a continuing  basis,  to provide the Designated  Lender with any
credit or other information with respect to the Borrower,  any Subsidiary or any
other Loan Party or to notify the  Designated  Lender of any Default or Event of
Default.

         Section 5. Appointment of Designating Lender as  Attorney-In-Fact.  The
Designated  Lender  hereby  appoints the  Designating  Lender as the  Designated
Lender's agent and  attorney-in-fact,  and grants to the  Designating  Lender an
irrevocable  power of  attorney,  to receive any and all payments to be made for
the benefit of the Designated Lender under the Credit Agreement,  to deliver and
receive all  notices and other  communications  under the Credit  Agreement  and
other Loan  Documents  and to exercise  on the  Designated  Lender's  behalf all

                                      B-2
<PAGE>

rights to vote and to grant and make approvals,  waivers, consents of amendments
to or under the Credit Agreement or other Loan Documents.  Any document executed
by the Designating  Lender on the Designated  Lender's behalf in connection with
the Credit  Agreement or other Loan Documents shall be binding on the Designated
Lender.  Each  Borrower,  each Agent and each of the Lenders may rely on and are
beneficiaries of the preceding provisions.

         Section 6.  Acceptance  by the Agent.  Following  the execution of this
Agreement by the Designating  Lender and the Designated  Lender, the Designating
Lender will (i) deliver to the Agent a duly executed  original of this Agreement
for  acceptance by the Agent and (ii) pay to the Agent the fee, if any,  payable
under the applicable provisions of the Credit Agreement whereupon this Agreement
shall become  effective as of the date of such  acceptance or such other date as
may be specified on the signature page hereof (the "Effective Date").

         Section 7. Effect of Designation. Upon such acceptance and recording by
the Agent, as of the Effective  Date, the Designated  Lender shall be a party to
the Credit Agreement with a right to make Bid Rate Loans as a Lender pursuant to
Section 2.2. of the Credit  Agreement and the rights and obligations of a Lender
related  thereto;  provided,  however,  that the Designated  Lender shall not be
required to make payments with respect to such obligations  except to the extent
of excess cash flow of the Designated Lender which is not otherwise  required to
repay  obligations  of the  Designated  Lender  which are then due and  payable.
Notwithstanding  the  foregoing,  the  Designating  Lender,  as  agent  for  the
Designated Lender, shall be and remain obligated to the Borrowers, the Agent and
the Lenders for each and every of the  obligations of the Designated  Lender and
the Designating Lender with respect to the Credit Agreement.

         Section 8. Indemnification of Designated Lender. The Designating Lender
unconditionally  agrees to pay or reimburse the  Designated  Lender and save the
Designated  Lender  harmless  against  all  liabilities,   obligations,  losses,
damages, penalties,  actions, judgments, suits, costs, expenses or disbursements
of any kind or nature  whatsoever which may be imposed or asserted by any of the
parties to the Loan Documents against the Designated  Lender, in its capacity as
such, in any way relating to or arising out of this  Agreement or any other Loan
Documents or any action taken or omitted by the Designated  Lender  hereunder or
thereunder,  provided  that the  Designating  Lender shall not be liable for any
portion of such liabilities,  obligations,  losses, damages, penalties, actions,
judgments,  suits, costs, expenses or disbursements if the same results from the
Designated Lender's gross negligence or willful misconduct.

         Section 9.  Governing  Law.  THIS  AGREEMENT  SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE  WITH,  THE LAWS OF THE STATE OF NEW YORK  APPLICABLE TO
CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.

         Section 10. Counterparts.  This Agreement may be executed in any number
of counterparts each of which, when taken together, shall constitute one and the
same agreement.

                                      B-3
<PAGE>

         Section 11.  Headings.  Section  headings have been inserted herein for
convenience only and shall not be construed to be a part hereof.

         Section 12.  Amendments;  Waivers.  This  Agreement may not be amended,
changed, waived or modified except by a writing executed by all parties hereto.

         Section 13. Binding  Effect.  This Agreement  shall be binding upon and
inure to the benefit of the parties hereto and their  respective  successors and
permitted assigns.

         Section 14.  Definitions.  Terms not otherwise  defined herein are used
herein with the respective meanings given them in the Credit Agreement.

                         [Signatures on Following Page]

                                      B-4
<PAGE>

         IN  WITNESS  WHEREOF,  the  parties  hereto  have  duly  executed  this
Designation Agreement as of the date and year first written above.

                                 Effective Date:
                                                   --------------------------

                                 DESIGNATING LENDER:

                                 [Name of Designating Lender]

                                 By:
                                    -----------------------------------------
                                      Name:
                                           ----------------------------------
                                      Title:
                                            ---------------------------------

                                 Designated Lender:

                                 [Name of Designated Lender]

                                 By:
                                    -----------------------------------------
                                      Name:
                                           ----------------------------------
                                      Title:
                                            ---------------------------------

Accepted as of the date first written above.

AGENT:

FIRST UNION NATIONAL BANK, as Agent

By:
   -----------------------------------------
     Name:
          ----------------------------------
     Title:
           ---------------------------------

                                      B-5
<PAGE>

                                    EXHIBIT C

                           FORM OF NOTICE OF BORROWING

                               ____________, 200_

First Union National Bank, as Agent
One First Union Center, TW-6
301 South College Street
Mail Code:  NC0166
Charlotte, North Carolina  28288-0166
Attention:  _____________________

Ladies and Gentlemen:

         Reference is made to that certain  Credit  Agreement  dated as of April
30, 2001 (as amended, restated,  supplemented or otherwise modified from time to
time,  the  "Credit  Agreement"),  by  and  among  HRPT  Properties  Trust  (the
"Borrower"),  the financial institutions party thereto and their assignees under
Section 12.5 thereof (the  "Lenders"),  First Union National Bank, as Agent (the
"Agent"), and the other parties thereto.  Capitalized terms used herein, and not
otherwise  defined  herein,  have their  respective  meanings  given them in the
Credit Agreement.

         1.       Pursuant  to  Section  2.1.(b) of the  Credit  Agreement,  the
                  Borrower hereby requests that the Lenders make Revolving Loans
                  to   the   Borrower   in  an   aggregate   amount   equal   to
                  $_______________.

         2.       The  Borrower  requests  that  such  Revolving  Loans  be made
                  available to the Borrower on ____________, 200_.

         3.       The Borrower  hereby  requests  that the  requested  Revolving
                  Loans all be of the following Type:

                  [Check one box only]

                        / /  Base Rate Loans
                        / /  LIBOR Loans,  each with an initial Interest Period
                            for a duration of:

                  [Check one box only]  / /   7 days
                                        / /   30 days
                                        / /   90 days

                                      C-1
<PAGE>

         4.       The proceeds of this borrowing of Revolving Loans will be used
                  for   the   following    purpose:    -------------------------
                  ------------------------------------------------------------.

         5.       The Borrower  requests that the proceeds of this  borrowing of
                  Revolving   Loans  be  made   available  to  the  Borrower  by
                  ____________________________.

         The Borrower  hereby  certifies to the Agent and the Lenders that as of
the date  hereof  and as of the date of the  making of the  requested  Revolving
Loans and after giving effect thereto, (a) no Default or Event of Default has or
shall  have  occurred  and  be  continuing,  and  (b)  the  representations  and
warranties  made or deemed made by the Borrower and each other Loan Party in the
Loan Documents to which any of them is a party are and shall be true and correct
in all material  respects,  except to the extent that such  representations  and
warranties  expressly  relate  solely to an  earlier  date (in  which  case such
representations  and warranties were true and accurate on and as of such earlier
date) and except for changes in factual circumstances specifically and expressly
permitted under the Credit Agreement. In addition, the Borrower certifies to the
Agent  and the  Lenders  that all  conditions  to the  making  of the  requested
Revolving Loans  contained in Article V. of the Credit  Agreement will have been
satisfied at the time such Revolving Loans are made.

         If notice of the requested  borrowing of Revolving Loans was previously
given by telephone,  this notice is to be considered the written confirmation of
such telephone notice required by Section 2.1.(b) of the Credit Agreement.

         IN WITNESS  WHEREOF,  the  undersigned  has duly executed and delivered
this Notice of Borrowing as of the date first written above.

                                 HRPT PROPERTIES TRUST

                                 By:
                                     ---------------------------------------
                                      Name:
                                           ---------------------------------
                                      Title:
                                            --------------------------------

                                      C-2

<PAGE>

                                    EXHIBIT D

                         FORM OF NOTICE OF CONTINUATION

                               ____________, 200_

First Union National Bank, as Agent
One First Union Center, TW-6
301 South College Street
Mail Code:  NC0166
Charlotte, North Carolina  28288-0166
Attention:  __________________

Ladies and Gentlemen:

         Reference is made to that certain  Credit  Agreement  dated as of April
30, 2001 (as amended, restated,  supplemented or otherwise modified from time to
time,  the  "Credit  Agreement"),  by  and  among  HRPT  Properties  Trust  (the
"Borrower"),  the financial institutions party thereto and their assignees under
Section 12.5 thereof (the  "Lenders"),  First Union National Bank, as Agent (the
"Agent"), and the other parties thereto.  Capitalized terms used herein, and not
otherwise  defined  herein,  have their  respective  meanings  given them in the
Credit Agreement.

         Pursuant to Section 2.9. of the Credit  Agreement,  the Borrower hereby
requests a Continuation of a borrowing of Loans under the Credit Agreement,  and
in  that  connection   sets  forth  below  the  information   relating  to  such
Continuation as required by such Section of the Credit Agreement:

         1.       The proposed date of such Continuation is ____________, _____.

         2.       The  aggregate  principal  amount  of  Loans  subject  to  the
                  requested  Continuation is  $________________________  and was
                  originally borrowed by the Borrower on ____________, 200_.

         3.       The  portion  of  such   principal   amount  subject  to  such
                  Continuation is $________________.

         4.       The current  Interest  Period for each of the Loans subject to
                  such Continuation ends on ________________, 200_.

                                      D-1
<PAGE>

         5.       The duration of the new Interest Period for each of such Loans
                  or portion thereof subject to such Continuation is:

                  [Check one box only]  / /   7 days
                                        / /   30 days
                                        / /   90 days

         The Borrower  hereby  certifies to the Agent and the Lenders that as of
the date hereof,  as of the proposed  date of the  requested  Continuation,  and
after giving effect to such Continuation,  no Default or Event of Default has or
shall have occurred and be continuing.

         If  notice  of the  requested  Continuation  was  given  previously  by
telephone,  this notice is to be  considered  the written  confirmation  of such
telephone notice required by Section 2.9. of the Credit Agreement.

         IN WITNESS  WHEREOF,  the  undersigned  has duly executed and delivered
this Notice of Continuation as of the date first written above.

                                 HRPT PROPERTIES TRUST

                                 By:
                                     ------------------------------------------
                                      Name:
                                           ------------------------------------
                                      Title:
                                            -----------------------------------

                                      D-2

<PAGE>

                                    EXHIBIT E

                          FORM OF NOTICE OF CONVERSION

                               ____________, 200_

First Union National Bank, as Agent
One First Union Center, TW-6
301 South College Street
Mail Code:  NC0166
Charlotte, North Carolina  28288-0166
Attention:  ______________

Ladies and Gentlemen:

         Reference is made to that certain  Credit  Agreement  dated as of April
30, 2001 (as amended, restated,  supplemented or otherwise modified from time to
time,  the  "Credit  Agreement"),  by  and  among  HRPT  Properties  Trust  (the
"Borrower"),  the financial institutions party thereto and their assignees under
Section 12.5 thereof (the  "Lenders"),  First Union National Bank, as Agent (the
"Agent"), and the other parties thereto.  Capitalized terms used herein, and not
otherwise  defined  herein,  have their  respective  meanings  given them in the
Credit Agreement.

         Pursuant to Section 2.10. of the Credit Agreement,  the Borrower hereby
requests a Conversion  of a borrowing of Loans of one Type into Loans of another
Type under the Credit  Agreement,  and in that  connection  sets forth below the
information  relating to such  Conversion  as  required  by such  Section of the
Credit Agreement:

         1.       The proposed date of such Conversion is ______________, 200_.

         2.       The Loans to be Converted pursuant hereto are currently:

                  [Check one box only]    / /    Base Rate Loans
                                          / /    LIBOR Loans

         3.       The  aggregate  principal  amount  of  Loans  subject  to  the
                  requested   Conversion  is   $_____________________   and  was
                  originally borrowed by the Borrower on ____________, 200_.

         4.       The  portion  of  such   principal   amount  subject  to  such
                  Conversion is $___________________.

                                      E-1
<PAGE>

         5.       The amount of such Loans to be so Converted is to be converted
                  into Loans of the following Type:

                  [Check one box only]

                        / /  Base Rate Loans
                        / /  LIBOR Loans,  each with an initial Interest Period
                            for a duration of:

                  [Check one box only]  / /   7 days
                                        / /   30 days
                                        / /   90 days

         The Borrower  hereby  certifies to the Agent and the Lenders that as of
the date hereof and as of the date of the requested  Conversion and after giving
effect  thereto,  (a) no Default or Event of Default has or shall have  occurred
and be continuing,  and (b) the  representations  and warranties  made or deemed
made by the  Borrower  and each other Loan Party in the Loan  Documents to which
any of them is a party  are and  shall  be  true  and  correct  in all  material
respects,  except  to  the  extent  that  such  representations  and  warranties
expressly  relate solely to an earlier date (in which case such  representations
and warranties were true and accurate on and as of such earlier date) and except
for changes in factual circumstances  specifically and expressly permitted under
the Credit Agreement.

         If  notice  of  the  requested   Conversion  was  given  previously  by
telephone,  this notice is to be  considered  the written  confirmation  of such
telephone notice required by Section 2.10. of the Credit Agreement.

         IN WITNESS  WHEREOF,  the  undersigned  has duly executed and delivered
this Notice of Conversion as of the date first written above.

                                 HRPT PROPERTIES TRUST

                                 By:
                                     ------------------------------------------
                                      Name:
                                           ------------------------------------
                                      Title:
                                            -----------------------------------

                                      E-2

<PAGE>
                                    EXHIBIT F

                      FORM OF NOTICE OF SWINGLINE BORROWING

                                                ------------, -----

First Union National Bank, as Agent
One First Union Center, TW-6
301 South College Street
Mail Code:  NC0166
Charlotte, North Carolina  28288-0166
Attention:  ______________

Ladies and Gentlemen:

         Reference is made to that certain  Credit  Agreement  dated as of April
30, 2001 (as amended, restated,  supplemented or otherwise modified from time to
time,  the  "Credit  Agreement"),  by  and  among  HRPT  Properties  Trust  (the
"Borrower"),  the financial institutions party thereto and their assignees under
Section 12.5 thereof (the  "Lenders"),  First Union National Bank, as Agent (the
"Agent"), and the other parties thereto.  Capitalized terms used herein, and not
otherwise  defined  herein,  have their  respective  meanings  given them in the
Credit Agreement.

         1.       Pursuant  to  Section  2.3.(b) of the  Credit  Agreement,  the
                  Borrower  hereby  requests  that the  Swingline  Lender make a
                  Swingline   Loan  to  the  Borrower  in  an  amount  equal  to
                  $__________________.

         2.       The  Borrower  requests  that  such  Swingline  Loan  be  made
                  available to the Borrower on ____________, 200_.

         3.       The  proceeds  of this  Swingline  Loan  will be used  for the
                  following  purpose:   ________________________________________
                  ___________________________________________________________.

         4.       The Borrower requests that the proceeds of such Swingline Loan
                  be     made      available      to     the     Borrower     by
                  ______________________________.

         The Borrower hereby  certifies to the Agent,  the Swingline  Lender and
the  Lenders  that as of the date  hereof,  as of the date of the  making of the
requested  Swingline  Loan, and after making such Swingline Loan, (a) no Default
or Event of Default has or shall have  occurred and be  continuing,  and (b) the
representations  and  warranties  made or deemed made by the  Borrower  and each
other Loan Party in the Loan  Documents  to which any of them is a party are and
shall be true and correct in all  material  respects,  except to the extent that
such  representations and warranties  expressly relate solely to an earlier date
(in which case such representations and warranties were true and accurate on and
as of such  earlier  date) and  except  for  changes  in  factual

                                       F-1
<PAGE>

circumstances  specifically and expressly  permitted under the Credit Agreement.
In  addition,  the  Borrower  certifies  to the Agent and the  Lenders  that all
conditions to the making of the requested Swingline Loan contained in Article V.
of the Credit Agreement will have been satisfied at the time such Swingline Loan
is made.

         If  notice  of the  requested  borrowing  of this  Swingline  Loan  was
previously  given by  telephone,  this  notice is to be  considered  the written
confirmation of such telephone  notice required by Section 2.3.(b) of the Credit
Agreement.

         IN WITNESS  WHEREOF,  the  undersigned  has duly executed and delivered
this Notice of Swingline Borrowing as of the date first written above.

                                 HRPT PROPERTIES TRUST

                                 By:
                                     -----------------------------------------
                                      Name:
                                           -----------------------------------
                                      Title:
                                            ----------------------------------

<PAGE>

                                    EXHIBIT G

                             FORM OF SWINGLINE NOTE

$25,000,000.00                                                   April 30, 2001

         FOR VALUE RECEIVED, the undersigned,  HRPT PROPERTIES TRUST, a Maryland
real estate  investment  trust (the  "Borrower"),  hereby promises to pay to the
order of FIRST UNION  NATIONAL BANK (the  "Swingline  Lender") to its address at
One First Union Center,  301 South College  Street,  Charlotte,  North  Carolina
28288,  or at such other address as may be specified in writing by the Swingline
Lender to the  Borrower,  the principal  sum of  TWENTY-FIVE  MILLION AND NO/100
DOLLARS  ($25,000,000.00)  (or such lesser  amount as shall equal the  aggregate
unpaid  principal  amount of Swingline Loans made by the Swingline Lender to the
Borrower under the Credit Agreement),  on the dates and in the principal amounts
provided in the Credit  Agreement,  and to pay interest on the unpaid  principal
amount  owing  hereunder,  at the rates and on the dates  provided in the Credit
Agreement.

         The date,  amount of each  Swingline  Loan,  and each  payment  made on
account of the principal  thereof,  shall be recorded by the Swingline Lender on
its books and,  prior to any  transfer of this Note,  endorsed by the  Swingline
Lender on the schedule  attached hereto or any  continuation  thereof,  provided
that the  failure  of the  Swingline  Lender  to make any  such  recordation  or
endorsement  shall not affect the  obligations of the Borrower to make a payment
when due of any amount owing under the Credit  Agreement or hereunder in respect
of the Swingline Loans.

         This Note is the  Swingline  Note  referred to in the Credit  Agreement
dated as of April 30, 2001 (as  amended,  restated,  supplemented  or  otherwise
modified from time to time, the "Credit Agreement"),  by and among the Borrower,
the financial  institutions party thereto and their assignees under Section 12.5
thereof (the  "Lenders"),  First Union  National  Bank, as Agent,  and the other
parties thereto,  and evidences Swingline Loans made to the Borrower thereunder.
Terms used but not otherwise  defined in this Note have the respective  meanings
assigned to them in the Credit Agreement.

         The Credit  Agreement  provides for the acceleration of the maturity of
this Note upon the occurrence of certain events and for prepayments of Swingline
Loans upon the terms and conditions specified therein.

         This Note shall be governed by, and construed in accordance  with,  the
laws of the State of NEW YORK APPLICABLE TO CONTRACTS EXECUTED,  AND TO BE FULLY
PERFORMED, IN SUCH STATE.

         The Borrower hereby waives presentment for payment,  demand,  notice of
demand, notice of non-payment,  protest, notice of protest and all other similar
notices.

                                      G-1
<PAGE>

         Time is of the essence for this Note.

         IN WITNESS  WHEREOF,  the  undersigned  has executed and delivered this
Swingline Note under seal as of the date first written above.

                                 HRPT PROPERTIES TRUST

                                 By:
                                     ----------------------------------------
                                      Name:
                                           ----------------------------------
                                      Title:
                                            ---------------------------------

                                 Attest:
                                        -------------------------------------
                                         Name:
                                              -------------------------------
                                         Title:
                                               ------------------------------

                                 [CORPORATE SEAL]

                                      G-2

<PAGE>

                           SCHEDULE OF Swingline LOANS

         This Note  evidences  Swingline  Loans made under the  within-described
Credit Agreement to the Borrower,  on the dates and in the principal amounts set
forth  below,  subject to the payments and  prepayments  of principal  set forth
below:

                    Principal                         Unpaid
                     Amount      Amount Paid or      Principal      Notation
Date of Loan        of Loan         Prepaid           Amount         Made By
------------        -------         -------           ------         -------

                                      G-3

<PAGE>

                                    EXHIBIT H

                         FORM OF BID RATE QUOTE REQUEST

                                               --------------, -----

First Union National Bank, as Agent
One First Union Center, TW-6
301 South College Street
Mail Code:  NC0166
Charlotte, North Carolina  28288-0166
Attention:  ______________

Ladies and Gentlemen:

         Reference is made to that certain  Credit  Agreement  dated as of April
30, 2001 (as amended, restated,  supplemented or otherwise modified from time to
time,  the  "Credit  Agreement"),  by  and  among  HRPT  Properties  Trust  (the
"Borrower"),  the financial institutions party thereto and their assignees under
Section 12.5 thereof (the  "Lenders"),  First Union National Bank, as Agent (the
"Agent"), and the other parties thereto.  Capitalized terms used herein, and not
otherwise  defined  herein,  have their  respective  meanings  given them in the
Credit Agreement.

         1.       The Borrower hereby requests Bid Rate Quotes for the following
                  proposed Bid Rate Borrowings:

Borrowing Date                 Amount1                     Interest Period2
--------------                 -------                     ----------------

______________, 200_           $____________               ______ days

         2.       Borrower's Credit Rating, as applicable, as of the date hereof
                  is:

                           S&P      _______
                           Moody's  _______

--------

1    Minimum amount of $10,000,000 or larger multiple of $500,000.

2    Not less than 7 nor more than 90 days in duration.

                                      H-1
<PAGE>

         3.       The proceeds of this Bid Rate  borrowing  will be used for the
                  following  purpose:  -----------------------------------------
                  ----------------------------------------------------------.

         4.       After  giving  effect  to the  Bid  Rate  Borrowing  requested
                  herein,  the total amount of Bid Rate Loans  outstanding shall
                  be $______________.3

         The Borrower  hereby  certifies to the Agent and the Lenders that as of
the date hereof,  as of the date of the making of the  requested Bid Rate Loans,
and after making such Bid Rate Loans,  (a) no Default or Event of Default has or
shall  have  occurred  and  be  continuing,  and  (b)  the  representations  and
warranties  made or deemed made by the Borrower and each other Loan Party in the
Loan Documents to which any of them is a party are and shall be true and correct
in all material  respects,  except to the extent that such  representations  and
warranties  expressly  relate  solely to an  earlier  date (in  which  case such
representations  and warranties were true and accurate on and as of such earlier
date) and except for changes in factual circumstances specifically and expressly
permitted under the Credit Agreement. In addition, the Borrower certifies to the
Agent and the Lenders that all  conditions  to the making of the  requested  Bid
Rate  Loans  contained  in Article  V. of the  Credit  Agreement  will have been
satisfied at the time such Bid Rate Loans are made.

         IN WITNESS  WHEREOF,  the  undersigned  has duly executed and delivered
this Bid Rate Quote Request as of the date first written above.

                                 HRPT PROPERTIES TRUST

                                 By:
                                     ------------------------------------------
                                      Name:
                                           ------------------------------------
                                      Title:
                                            -----------------------------------

----------
3    Must not be in excess of the lesser of (i) $200,000,000 or (ii) one-half of
     the aggregate amount of all existing Commitments.

                                      H-2
<PAGE>
                                    EXHIBIT I

                             FORM OF BID RATE QUOTE

                                              ----------------, ----

First Union National Bank, as Agent
One First Union Center, TW-6
301 South College Street
Mail Code:  NC0166
Charlotte, North Carolina  28288-0166
Attention:  ______________

Ladies and Gentlemen:

         Reference is made to that certain  Credit  Agreement  dated as of April
30, 2001 (as amended, restated,  supplemented or otherwise modified from time to
time,  the  "Credit  Agreement"),  by  and  among  HRPT  Properties  Trust  (the
"Borrower"),  the financial institutions party thereto and their assignees under
Section 12.5 thereof (the  "Lenders"),  First Union National Bank, as Agent (the
"Agent"), and the other parties thereto.  Capitalized terms used herein, and not
otherwise  defined  herein,  have their  respective  meanings  given them in the
Credit Agreement.

     In response to Borrower's Bid Rate Quote Request dated _____________, 200_,
the  undersigned  hereby makes the  following Bid Rate Quote(s) on the following
terms:

        1.       Quoting Lender:____________________________

        2.       Person to contact at quoting Lender:_________________________

        3.       The  undersigned  offers  to  make  Bid  Rate  Loan(s)  in  the
                 following  principal  amount(s),  for  the  following  Interest
                 Period(s) and at the following Bid Rate(s):

Borrowing Date                   Amount1                     Interest Period2
--------------                   -------                     ----------------

______________, 200_             $____________               ______ days

--------

1    Minimum amount of $10,000,000 or larger multiple of $500,000.

2    Not less than 7 nor more than 90 days in duration.

                                      I-1
<PAGE>

         The  undersigned  understands  and agrees that the  offer(s)  set forth
above,  subject to  satisfaction  of the applicable  conditions set forth in the
Credit Agreement,  irrevocably  obligate[s] the undersigned to make the Bid Rate
Loan(s) for which any offer(s) [is/are] accepted, in whole or in part.

                                 [Name of Quoting Lender]

                                 By:
                                    ------------------------------------------
                                      Name:
                                           -----------------------------------
                                      Title:
                                            ----------------------------------

                                      I-2
<PAGE>

                                    EXHIBIT J

                        FORM OF BID RATE QUOTE ACCEPTANCE

                            __________________, 200_

First Union National Bank, as Agent
One First Union Center, TW-6
301 South College Street
Mail Code:  NC0166
Charlotte, North Carolina  28288-0166
Attention:  ______________

Ladies and Gentlemen:

         Reference is made to that certain  Credit  Agreement  dated as of April
30, 2001 (as amended, restated,  supplemented or otherwise modified from time to
time,  the  "Credit  Agreement"),  by  and  among  HRPT  Properties  Trust  (the
"Borrower"),  the financial institutions party thereto and their assignees under
Section 12.5 thereof (the  "Lenders"),  First Union National Bank, as Agent (the
"Agent"), and the other parties thereto.  Capitalized terms used herein, and not
otherwise  defined  herein,  have their  respective  meanings  given them in the
Credit Agreement.

     Borrower  hereby  accepts the  following  offer(s) of Bid Rate Quotes to be
made available to the Borrower on ____________, 200_:

     Quote Date                      Quoting Lender             Amount Accepted
     ----------                      --------------             ---------------

 ____________, 200_                  _______________              $___________

 ____________, 200_                  _______________              $___________

 ____________, 200_                  _______________              $___________

         The Borrower  hereby  certifies to the Agent and the Lenders that as of
the date hereof,  as of the date of the making of the  requested Bid Rate Loans,
and after making such Bid Rate Loans,  (a) no Default or Event of Default has or
shall  have  occurred  and  be  continuing,  and  (b)  the  representations  and
warranties  made or deemed made by the Borrower and each other Loan Party in the
Loan Documents to which any of them is a party are and shall be true and correct
in all material  respects,  except to the extent that such  representations  and
warranties  expressly  relate  solely to an  earlier  date (in  which  case such
representations  and warranties were true and accurate on and as of such earlier
date) and except for changes in factual circumstances specifically and expressly
permitted under the Credit Agreement. In addition, the Borrower certifies to the
Agent and the Lenders that all  conditions  to the making of the  requested  Bid
Rate
                                      J-1

<PAGE>

Loans  contained in Article V. of the Credit  Agreement will have been satisfied
at the time such Bid Rate Loans are made.

         IN WITNESS  WHEREOF,  the  undersigned  has duly executed and delivered
this Bid Rate Quote Acceptance as of the date first written above.

                                 HRPT PROPERTIES TRUST

                                 By:
                                     ------------------------------------------
                                      Name:
                                           ------------------------------------
                                      Title:
                                            -----------------------------------

                                      J-2

<PAGE>

                                    EXHIBIT K

                             FORM OF REVOLVING NOTE

$____________________                                     _______________, 200_

         FOR VALUE RECEIVED, the undersigned,  HRPT PROPERTIES TRUST, a Maryland
real estate  investment  trust (the  "Borrower"),  hereby promises to pay to the
order of  ____________________  (the "Lender"),  in care of First Union National
Bank,  as Agent (the  "Agent") to First  Union  National  Bank,  One First Union
Center,  301 South College Street,  Charlotte,  North Carolina 28288, or at such
other address as may be specified in writing by the Agent to the  Borrower,  the
principal sum of ________________ AND ____/100 DOLLARS  ($____________) (or such
lesser amount as shall equal the aggregate  unpaid principal amount of Revolving
Loans made by the Lender to the Borrower  under the Credit  Agreement (as herein
defined)),  on the dates and in the  principal  amounts  provided  in the Credit
Agreement,  and to pay interest on the unpaid  principal amount owing hereunder,
at the rates and on the dates provided in the Credit Agreement.

         The date,  amount  of each  Revolving  Loan  made by the  Lender to the
Borrower,  and each payment made on account of the principal  thereof,  shall be
recorded  by the Lender on its books and,  prior to any  transfer  of this Note,
endorsed  by the  Lender on the  schedule  attached  hereto or any  continuation
thereof, provided that the failure of the Lender to make any such recordation or
endorsement  shall not affect the  obligations of the Borrower to make a payment
when due of any amount owing under the Credit  Agreement or hereunder in respect
of the Revolving Loans made by the Lender.

         This  Note is one of the  Revolving  Notes  referred  to in the  Credit
Agreement  dated as of April 30, 2001 (as  amended,  restated,  supplemented  or
otherwise modified from time to time, the "Credit Agreement"),  by and among the
Borrower,  the financial  institutions  party thereto and their  assignees under
Section 12.5 thereof (the "Lenders"),  the Agent, and the other parties thereto.
Capitalized  terms used herein,  and not otherwise  defined  herein,  have their
respective meanings given them in the Credit Agreement.

         The Credit  Agreement  provides for the acceleration of the maturity of
this Note upon the  occurrence of certain  events and for  prepayments  of Loans
upon the terms and conditions specified therein.

         Except as permitted by Section 12.5.(d) of the Credit  Agreement,  this
Note may not be assigned by the Lender to any other Person.

                                      K-1

<PAGE>

         This Note shall be governed by, and construed in accordance  with,  the
laws of the State of NEW YORK APPLICABLE TO CONTRACTS EXECUTED,  AND TO BE FULLY
PERFORMED, IN SUCH STATE.

         The Borrower hereby waives presentment for payment,  demand,  notice of
demand, notice of non-payment,  protest, notice of protest and all other similar
notices.

         Time is of the essence for this Note.

         IN WITNESS  WHEREOF,  the  undersigned  has executed and delivered this
Revolving Note under seal as of the date first written above.

                                 HRPT PROPERTIES TRUST

                                 By:
                                     ----------------------------------------
                                      Name:
                                           ----------------------------------
                                      Title:
                                            ---------------------------------

                                 Attest:
                                        -------------------------------------
                                         Name:
                                              -------------------------------
                                         Title:
                                               ------------------------------

                                 [CORPORATE SEAL]

                                      K-2
<PAGE>
                                    EXHIBIT L

                              FORM OF BID RATE NOTE

                                                             ____________, 200_

         FOR VALUE RECEIVED, the undersigned,  HRPT PROPERTIES TRUST, a Maryland
real estate  investment  trust (the  "Borrower"),  hereby promises to pay to the
order of ________________ (the "Lender"),  in care of First Union National Bank,
as Agent (the "Agent") to First Union National Bank, One First Union Center, 301
South College Street, Charlotte,  North Carolina 28288, or at such other address
as may be  specified  in writing  by the Agent to the  Borrower,  the  aggregate
unpaid  principal  amount of Bid Rate Loans  made by the Lender to the  Borrower
under the Credit  Agreement,  on the dates and in the principal amounts provided
in the Credit  Agreement,  and to pay interest on the unpaid principal amount of
each such Bid Rate Loan,  at such office at the rates and on the dates  provided
in the Credit Agreement.

         The date, amount, interest rate and maturity date of each Bid Rate Loan
made by the  Lender to the  Borrower,  and each  payment  made on account of the
principal  thereof,  shall be recorded by the Lender on its books and,  prior to
any  transfer  of this Note,  endorsed  by the Lender on the  schedule  attached
hereto or any continuation  thereof,  provided that the failure of the Lender to
make any such recordation or endorsement shall not affect the obligations of the
Borrower  to make a  payment  when due of any  amount  owing  under  the  Credit
Agreement or hereunder in respect of the Bid Rate Loans made by the Lender.

         This  Note is one of the  Bid  Rate  Notes  referred  to in the  Credit
Agreement  dated as of April 30, 2001 (as  amended,  restated,  supplemented  or
otherwise modified from time to time, the "Credit Agreement"),  by and among the
Borrower,  the financial  institutions  party thereto and their  assignees under
Section 12.5 thereof (the "Lenders"),  the Agent, and the other parties thereto,
and evidences Bid Rate Loans made by the Lender  thereunder.  Terms used but not
otherwise defined in this Note have the respective  meanings assigned to them in
the Credit Agreement.

         The Credit  Agreement  provides for the acceleration of the maturity of
this Note upon the occurrence of certain events and for  prepayments of Bid Rate
Loans upon the terms and conditions specified therein.

     Except as permitted by Section 12.5. of the Credit Agreement, this Note may
not be assigned by the Lender to any other Person.

         This Note shall be governed by, and construed in accordance  with,  the
laws of the State of NEW YORK APPLICABLE TO CONTRACTS EXECUTED,  AND TO BE FULLY
PERFORMED, IN SUCH STATE.

         The Borrower hereby waives presentment for payment,  demand,  notice of
demand, notice of non-payment,  protest, notice of protest and all other similar
notices.

                                      L-1
<PAGE>

         Time is of the essence for this Note.

         IN WITNESS WHEREOF, the undersigned has executed and delivered this Bid
Rate Note under seal as of the date first written above.

                                 HRPT PROPERTIES TRUST

                                 By:
                                     ---------------------------------------
                                      Name:
                                           ---------------------------------
                                      Title:
                                            --------------------------------

                                 Attest:
                                        ------------------------------------
                                         Name:
                                              ------------------------------
                                         Title:
                                               -----------------------------

                                 [CORPORATE SEAL]

                                      L-2

<PAGE>

                           SCHEDULE OF BID RATE LOANS

         This Note  evidences  Bid Rate Loans  made  under the  within-described
Credit  Agreement  to the  Borrower,  on the dates,  in the  principal  amounts,
bearing interest at the rates and maturing on the dates set forth below, subject
to the payments and prepayments of principal set forth below:

         Principal               Maturity     Amount      Unpaid
Date of  Amount of    Interest    Date of     Paid or    Principal    Notation
 Loan       Loan        Rate       Loan       Prepaid     Amount      Made By
 ----       ----        ----       ----       -------     ------      -------

                                      L-3

<PAGE>

                                    EXHIBIT M

                          FORM OF CANCELLATION REQUEST

                               ____________, 2003

First Union National Bank, as Agent
One First Union Center, TW-6
301 South College Street
Mail Code:  NC0166
Charlotte, North Carolina  28288-0166
Attention:  Rex E. Rudy

Ladies and Gentlemen:

         Reference is made to that certain  Credit  Agreement  dated as of April
30, 2001 (as amended, restated,  supplemented or otherwise modified from time to
time,  the  "Credit  Agreement"),  by  and  among  HRPT  Properties  Trust  (the
"Borrower"),  the financial institutions party thereto and their assignees under
Section 12.5 thereof (the  "Lenders"),  First Union National Bank, as Agent (the
"Agent"), and the other parties thereto.  Capitalized terms used herein, and not
otherwise  defined  herein,  have their  respective  meanings  given them in the
Credit Agreement.

         Pursuant to Section 2.13 of the Credit  Agreement,  the Borrower hereby
requests that the Lenders agree to shorten the Termination Date from its current
date of April 30, 2005 by one year to April 30, 2004.

         The Borrower hereby  certifies to the Agent and the Lenders that (a) no
Default  or  Event  of  Default  has  occurred  and is  continuing,  and (b) the
representations  and  warranties  made or deemed made by the  Borrower  and each
other  Loan  Party in the Loan  Documents  to which it is a party,  are true and
correct, except to the extent that such representations and warranties expressly
relate  solely to an  earlier  date (in  which  case  such  representations  and
warranties were true and accurate on and as of such earlier date) and except for
changes in factual circumstances  specifically and expressly permitted under the
Credit Agreement.

                                      M-1
<PAGE>

         IN WITNESS WHEREOF, the undersigned has duly executed this Cancellation
Request as of the date first written above.

                                 HRPT PROPERTIES TRUST

                                 By:
                                     -----------------------------------------
                                      Name:
                                           -----------------------------------
                                      Title:
                                            ----------------------------------

                                      M-2

<PAGE>

                                   EXHIBIT N-1

                           FORM OF OPINION OF COUNSEL

                       [LETTERHEAD OF BORROWER'S COUNSEL]

First Union National Bank, as Agent
for the Lenders under the Credit
Agreement referred to below
One First Union Center, TW-6
301 South College Street
Charlotte, North Carolina 28288

The Additional Addressees set
forth on Schedule I hereto

Ladies and Gentlemen:

         This opinion is delivered to you pursuant to Section  5.1(a)(iv) of the
Credit  Agreement dated as of April [19],  2001 (the "Credit  Agreement") by and
among HRPT Properties  Trust, a real estate investment trust organized under the
laws of the State of Maryland (the "Borrower"), the Lenders party thereto, First
Union National Bank, as Agent, and the other parties  thereto.  We have acted as
counsel for the Borrower and each of the Guarantors listed on Schedule II hereto
(collectively  with Borrower,  the "Loan Parties") in connection with the Credit
Agreement and the other Loan Documents identified below.  Capitalized terms used
in this  opinion,  unless  otherwise  defined  herein,  shall have the  meanings
assigned thereto in the Credit Agreement.

         For purposes of the opinions expressed below, we have examined executed
counterparts of:

                  (i)      the Credit Agreement;

                  (ii)     the Revolving Notes;

                  (iii)    the Bid Rate Notes;

                  (iv)     the Swingline Note; and

                  (v)      the Guaranty.

The Credit  Agreement,  the Revolving  Notes,  the Bid Rate Notes, the Swingline
Note  and  the  Guaranty  are  collectively  referred  to  herein  as the  "Loan
Documents".

         In  addition,   we  have  examined  the  originals  or  copies  of  the
declaration of trust, limited partnership agreement,  articles of incorporation,
articles of organization,  by-laws and operating

                                      N-1
<PAGE>

agreements, as applicable, of each Loan Party (collectively, the "Organizational
Documents" for such Loan Party),  certain  resolutions of the board of directors
or other  governing body of each Loan Party and such other  records,  agreements
and  instruments of the Loan Parties,  certificates  of public  officials and of
officers of the Loan  Parties and such other  documents  and  records,  and such
matters  of law,  as we  have  deemed  necessary  as a  basis  for the  opinions
hereinafter expressed.

         In connection with this opinion, we have assumed the genuineness of all
signatures,  the legal  capacity of natural  persons,  the  authenticity  of all
documents  submitted to us as originals  and the  conformity to the originals of
all documents  submitted to us as copies,  which facts we have not independently
verified. As to various facts material to the opinions set forth herein, we have
relied without independent verification upon factual representations made by the
Borrower in the Credit Agreement, upon certificates of public officials and upon
facts certified to us by officers of the Loan Parties, as the case may be.

         For purposes of the opinions expressed herein, we have assumed that (i)
each  Lender and Titled  Agent,  each Loan Party  organized  under the laws of a
jurisdiction other than Delaware, New York or Massachusetts and each other party
(other  than Loan  Parties  organized  under the laws of  Delaware,  New York or
Massachusetts) to the Loan Documents and to all other documents,  agreements and
instruments  examined  by us (A) are  corporations  or  other  entities  validly
existing under the laws of the jurisdiction of its organization and (B) have all
requisite  power  and  authority  (corporate  and  other),  and have  taken  all
necessary action to enter into and perform all of its obligations under the Loan
Documents or such other documents,  agreements and instruments to which they are
a party, and (ii) each Loan Document and each such other document, agreement and
instrument  are and will be the valid,  binding and  enforceable  obligations of
each party thereto,  other than the Loan Parties. We express no opinion upon the
application  of any federal,  state or local  statute,  law,  rule or regulation
(including without limitation any Federal or state banking,  truth-in-lending or
other similar credit  statute,  law, rule or regulation) to the authority of any
Lender or Titled Agent to enter into and to carry out its respective obligations
under and exercise rights or remedies under the Loan Documents.

         Statements herein as to the truth of certain matters "to our knowledge"
or as to matters  "known to us" and similar  statements  refer to the  knowledge
consciously held by the individual  lawyers in our firm who have participated in
the  negotiation  and  drafting  of  the  Loan  Documents  without   independent
investigation  and do not  necessarily  refer  to such  knowledge  as  might  be
acquired by a review of all of our files with respect to matters  involving  the
Loan Parties or by interviews with all present and former members and associates
of our firm. Without limiting the generality of the foregoing, please be advised
that in connection  with the opinions  expressed in paragraphs 6 and 8 below, we
have not conducted  any searches of dockets of any courts or other  Governmental
Authorities.

     Barry M. Portnoy is a trustee of the Borrower, a trustee and/or director of
the Guarantors and a director and 50%  shareholder of REIT Management & Research
Inc. ("RMR"), a Delaware  corporation which is the Borrower's advisor.  Jennifer
B. Clark is a Senior Vice President of the Borrower and an officer of several of
the Guarantors and of RMR. Mr. Portnoy and Ms. Clark are retired members of this
firm.  Inquiries  concerning  matters  which may be known to Mr.  Portnoy or Ms.
Clark

                                      N-2
<PAGE>
should be directed to them.

         This   opinion  is  limited  to  the  laws  of  the   Commonwealth   of
Massachusetts,  the laws of the State of New York (with  respect to paragraphs 5
and 11 only),  the  General  Corporation  Law and the  Revised  Uniform  Limited
Partnership  Act of the State of  Delaware  and the  federal  laws of the United
States of  America,  and we express no opinions  with  respect to the law of any
other  jurisdiction.  We  express  no opinion as to the effect of the law of any
jurisdiction  other than the State of New York  wherein any Lender  Party may be
located or wherein  enforcement of the Credit Agreement or any of the other Loan
Documents may be sought that limits the rates of interest legally  chargeable or
collectible.

         Our opinions set forth in  paragraphs 1 and 3 below with respect to the
existence,  good standing or qualification of the Borrower and the Guarantors in
various jurisdictions, other than the Guarantors which, as set forth on Schedule
II hereto, are Massachusetts  "nominee trusts," are based solely on certificates
to that effect  issued by the  Secretaries  of State of such  jurisdictions  and
heretofore  delivered  to the Agent.  Our opinion set forth in paragraph 2 below
with respect to the existence of each Guarantor  which, as set forth on Schedule
II hereto, is a Massachusetts  "nominee trust," is based solely on a certificate
to such effect from its trustee or trustees heretofore delivered to the Agent.

         Our  opinions  set forth  below are  subject to the  following  general
qualifications:

                                      N-3
<PAGE>

                  (a) Our opinion  set forth in  paragraph 5 below is subject to
         (i) the  effect of  applicable  bankruptcy,  insolvency,  receivership,
         reorganization,   moratorium,   liquidation   or  other   similar  laws
         (including,   without  limitation,  all  laws  relating  to  fraudulent
         transfers)  relating to or affecting  creditors' rights generally,  and
         (ii)  general  principles  of equity  (including  the  availability  of
         equitable remedies and further including, without limitation,  concepts
         of   materiality,   reasonableness,   good  faith  and  fair  dealing),
         regardless  of whether  considered in a proceeding in equity or at law.
         Further,  pursuant  to  such  equitable  principles,  Section  3 of the
         Guaranty, which provides, among other things, that the liability of the
         Guarantors  shall not be affected by  amendments to or other changes in
         the Loan Documents,  might be enforceable  only to the extent that such
         amendments or other changes were not so material as to constitute a new
         contract among the parties.

                  (b) We express no  opinion  as to powers  provisions  granting
         indemnity or rights of  contribution  (to the extent limited by federal
         or state securities laws or public policy).

                  (c) We express no  opinion as to (i) any  provision  of a Loan
         Document to the effect that  provisions  therein may only be amended or
         waived in writing,  to the extent that an oral agreement modifying such
         provisions  has been entered  into,  or (ii) any  provision of any Loan
         Document  for  the  payment  of an  increased  rate of  interest  after
         maturity  or a  default,  late  charges  or  similar  payments  (or any
         guaranty  thereof)  to the extent  such  interest,  charger or payments
         constitutes a penalty or for the payment of interest  after judgment in
         excess of any applicable statutory rate (or any guaranty thereof).

                  (d) The  enforceability  of the Loan  Documents may be limited
         (i) by general  principles  of contract law that where less than all of
         an agreement is enforceable,  the balance is enforceable  only when the
         unenforceable  portion is not an essential part of the agreed exchange,
         and  (ii)  by  the  exercise  of  judicial  discretion   regarding  the
         determination  of damages and  entitlement to attorneys' fees and other
         costs.

                  (e) We express no opinion as to whether any of the  Guarantors
         may guarantee or otherwise become liable for  indebtedness  incurred by
         the  Borrower  or  another  Loan Party  except to the  extent  that the
         guaranteeing  Guarantor may be determined  to have  benefited  from the
         incurrence of such indebtedness by such other entity, and we express no
         opinion as to whether the amount of such benefit may be  determined  by
         any measure other than the extent to which proceeds of the indebtedness
         incurred by such other entity are directly or indirectly made available
         to the Guarantor for its corporate,  partnership or analogous purposes.
         For purposes of this opinion,  we have relied on the  certification  of
         each  Loan  Party  that  the  transactions  contemplated  by  the  Loan
         Documents  are  necessary or  convenient  to the conduct,  promotion or
         attainment of the business of such Loan Party.

                                      N-4
<PAGE>

                  (f) We  express no  opinion  as to (i)  whether a state  court
         outside of the State of New York or a Federal  court  would give effect
         to the choice of New York law provided for in the Loan  Documents or to
         the  provisions of Section  12.4(b) of the Credit  Agreement or Section
         17(b) of the  Guaranty (or any  comparable  provision of any other Loan
         Document),  or (ii) the  provisions  of  Section  12.4(b) of the Credit
         Agreement or Section 17(b) of the Guaranty (or any comparable provision
         of any other Loan  Document)  to the extent  they relate to the subject
         matter jurisdiction of any Federal court.

         Based upon and subject to the foregoing, we are of the opinion that:

                                      N-5
<PAGE>

         1. Each  Guarantor  which,  as set forth on  Schedule  II hereto,  is a
corporation  or  limited  partnership  organized  under the laws of the State of
Delaware or the  Commonwealth of  Massachusetts  (i) is validly  existing and in
good  standing as a  corporation  or limited  partnership  under the laws of the
State of Delaware or the Commonwealth of Massachusetts,  as the case may be, and
(ii) has the corporate or partnership  (as the case may be) power to execute and
deliver, and to perform its obligations under, the Guaranty,  and to own and use
its  material  assets and  conduct  its  business  in all  material  respects as
presently conducted.

         2. Each  Guarantor  which,  as set forth on  Schedule  II hereto,  is a
Massachusetts  "nominee  trust"  (i)  exists  as a trust  under  the laws of the
Commonwealth of Massachusetts  and (ii) has the trust power to execute,  deliver
and perform the Guaranty  and to own and lease its  material  assets and conduct
its business in all material respects as presently conducted.

         3. The  Borrower is  qualified  to transact  business as a foreign real
estate  investment trust or business trust in the  jurisdictions  listed [under]
its name on  Schedule  III  hereto.  Each  Guarantor  is  qualified  to transact
business as a foreign real estate investment trust, business trust,  corporation
or limited partnership,  as applicable,  in the respective  jurisdictions listed
[under] its name on such Schedule III.

         4. The execution and delivery of the Guaranty by each  Guarantor  which
is  organized  under the laws of the State of  Delaware or the  Commonwealth  of
Massachusetts   and  the  performance  by  such  Guarantor  of  its  obligations
thereunder have been duly authorized by all necessary corporate,  partnership or
trust (as the case may be) action on the part of such Guarantor.

         5. Each Loan Party has duly executed and  delivered the Loan  Documents
to which it is a party, and each Loan Document is a valid and binding obligation
of each Loan Party which is a party thereto,  enforceable against each such Loan
Party in accordance with its terms.

         6. The  execution  and delivery by each of the Loan Parties of the Loan
Documents  to which it is a party do not,  and if each of the Loan  Parties were
now to perform its obligations under such Loan Documents, such performance would
not, result in any material:

                  (a) violation of such Loan Party's  respective  Organizational
         Documents;

                  (b)  violation  of  any  existing   federal  or  Massachusetts
         constitution  or  statute  or any  existing  federal  or  Massachusetts
         governmental  regulation or rule to which such Loan Party or its assets
         are subject;

                  (c)  breach  or  violation  of or  default  under  any  of the
         agreements,  instruments,  indentures  or  other  documents  listed  on
         Schedule  6.1(g) or Schedule  6.1(h) to the Credit  Agreement  to which
         such Loan Party is a party or by which such Loan Party or its assets is
         bound;

                                      N-6
<PAGE>

                  (d) creation or imposition of any contractual lien or security
         interest  in, on or against  the assets of any Loan Party  under any of
         the agreements,  instruments,  indentures or other documents  listed on
         Schedule  6.1(g) or Schedule  6.1(h) to the Credit  Agreement  to which
         such  Loan  Party  is a  party  or by  which  such  Loan  Party  or its
         respective assets is bound; or

                  (e) violation of any judicial or administrative  decree, writ,
         judgment  or order to which,  to our  knowledge,  any Loan Party or its
         respective assets are subject.

         7. The execution,  delivery and performance by each of the Loan Parties
of each Loan Document to which it is a party,  and the  consummation by the Loan
Parties  of the  transactions  thereunder,  do not  and  will  not  require  any
registration  with,  consent or approval  of, or notice to, or other  action to,
with or by, any  Governmental  Authority of the United  States of America or the
Commonwealth of Massachusetts  or by any Governmental  Authority of the State of
Delaware pursuant to the General  Corporation Law or the Revised Uniform Limited
Partnership Act of the State of Delaware.

         8. To our knowledge  there is no (i)  undischarged  judgment  which has
been entered against any Loan Party,  the satisfaction of which, or (ii) action,
suit,  proceeding  or  investigation  before or by any  federal or state  court,
agency  or other  governmental  or  administrative  board or  body,  pending  or
threatened,  against any of the Loan Parties in which an  unfavorable  decision,
ruling or finding,  would materially adversely affect the business or properties
or financial condition of the Loan Parties,  considered as a consolidated whole,
or the validity or enforceability of any of the Loan Documents.

         9. None of the Loan Parties is, or,  after giving  effect to the Loans,
if made on the date hereof,  would be,  subject to  regulation  under the Public
Utility  Holding  Company Act of 1935,  the Federal Power Act or the  Investment
Company Act of 1940, each as amended, or to any federal or Massachusetts statute
or  regulation  specifically  limiting  its  ability to incur  indebtedness  for
borrowed money.

         10.  Assuming  that  Borrower  applies  the  proceeds  of the  Loans as
provided in the Credit  Agreement,  the  transactions  contemplated  by the Loan
Documents do not violate the  provisions of Regulations T, U or X of the Federal
Reserve Board.

         11.  The  consideration  to be paid  to the  Lender  for the  financial
accommodations  to be  provided  to the  Loan  Parties  pursuant  to the  Credit
Agreement does not violate any law of the State of New York relating to interest
and usury.

         This opinion is furnished to you solely for your benefit in  connection
with the consummation of the  transactions  contemplated by the Credit Agreement
and may not be relied upon by any other person or entity, other than an Assignee
of a  Lender,  or for any other  purpose  without  our  express,  prior  written
consent.  All of the  opinions  set forth  herein  are  rendered  as of the date
hereof, and we assume no obligation to update such opinions to reflect any facts
or circumstances which may hereafter come to our attention or any changes in the
law which may hereafter occur.

                                      N-7
<PAGE>

                                     Very truly yours,

                                     [SULLIVAN & WORCESTER LLP]

                                      N-8
<PAGE>

                                                                   SCHEDULE I

                          List of Additional Addressees

Fleet National Bank
Wells Fargo Bank, National Association
Commerzbank  AG, New York and Grand Cayman Branches
The Bank of New York
AmSouth Bank
Citizens Bank of Massachusetts
SunTrust Bank
The Governor and Company of the Bank of Ireland
Chevy Chase Bank
Eastern Bank
National Bank of Egypt, New York Branch
RZB Finance LLC
Bank Leumi USA

                                      N-9
<PAGE>

                                                                     SCHEDULE II

                               List of Guarantors

                                      N-10
<PAGE>

                                                                   SCHEDULE III

            List of Jurisdictions in which Borrower is Qualified to
                      Transact Business as a Foreign Trust

                                      N-11
<PAGE>

                                    EXHIBIT O

                         FORM OF COMPLIANCE CERTIFICATE

                              _______________, 200_

First Union National Bank, as Agent
One First Union Center, TW-6
301 South College Street
Mail Code:  NC0166
Charlotte, North Carolina  28288-0166

Each  of  the  Lenders  Party  to  the  Credit   Agreement
   referred to below

Ladies and Gentlemen:

         Reference is made to that certain  Credit  Agreement  dated as of April
30, 2001 (as amended, restated,  supplemented or otherwise modified from time to
time,  the  "Credit  Agreement"),  by  and  among  HRPT  Properties  Trust  (the
"Borrower"),  the financial institutions party thereto and their assignees under
Section 12.5 thereof (the  "Lenders"),  First Union National Bank, as Agent (the
"Agent") and the other parties thereto.  Capitalized terms used herein,  and not
otherwise  defined  herein,  have their  respective  meanings  given them in the
Credit Agreement.

         Pursuant  to Section  8.3.  of the Credit  Agreement,  the  undersigned
hereby certifies to the Agent and the Lenders as follows:

         (1) The undersigned is the chief financial officer of the Borrower.

         (2) The  undersigned has examined the books and records of the Borrower
and has conducted such other  examinations and  investigations as are reasonably
necessary to provide this Compliance Certificate.

         (3) No  Default  or Event of  Default  exists [if such is not the case,
specify  such  Default or Event of Default and its nature,  when it occurred and
whether it is continuing  and the steps being taken by the Borrower with respect
to such event, condition or failure].

         (4) The  representations  and  warranties  made or  deemed  made by the
Borrower  and the other  Loan  Parties in the Loan  Documents  to which any is a
party,  are true and  correct  in all  material  respects  on and as of the date
hereof except to the extent that such  representations and warranties  expressly
relate  solely to an  earlier  date (in  which  case  such  representations  and
warranties shall have been true and accurate on and as of such earlier date) and
except for

                                      O-1
<PAGE>

changes in factual circumstances  specifically and expressly permitted under the
Credit Agreement.

         (5) Attached hereto as Schedule 1 are reasonably detailed  calculations
establishing whether or not the Borrower and its Subsidiaries were in compliance
with the  covenants  contained in Sections 9.1 through 9.3 and 9.6 of the Credit
Agreement.

         IN WITNESS WHEREOF, the undersigned has executed this certificate as of
the date first above written.

                                 Name:
                                       ------------------------------------
                                 Title:
                                       ------------------------------------

                                      O-2
<PAGE>

                                   Schedule 1

                          [Calculations to be Attached]

                                      O-3
<PAGE>
                                    EXHIBIT P

                                FORM OF GUARANTY

         THIS  GUARANTY  dated as of April 30, 2001,  executed and  delivered by
each of the  undersigned  and the other  Persons  from time to time party hereto
pursuant to the execution and delivery of an Accession  Agreement in the form of
Annex I hereto (all of the undersigned,  together with such other Persons each a
"Guarantor"  and  collectively,  the  "Guarantors")  in favor of (a) FIRST UNION
NATIONAL BANK, in its capacity as Agent (the "Agent") for the Lenders under that
certain that certain  Credit  Agreement  dated as of April 30, 2001 (as amended,
restated,  supplemented  or otherwise  modified  from time to time,  the "Credit
Agreement"), by and among HRPT Properties Trust (the "Borrower"),  the financial
institutions  party thereto and their  assignees under Section 12.5 thereof (the
"Lenders"),  the Agent, and the other parties  thereto,  and (b) the Lenders and
the Swingline Lender.

         WHEREAS,  pursuant to the Credit Agreement,  the Agent, the Lenders and
the  Swingline  Lender have agreed to make  available  to the  Borrower  certain
financial  accommodations  on the terms and  conditions  set forth in the Credit
Agreement;

         WHEREAS, the Borrower owns, directly or indirectly, at least a majority
of the issued and outstanding Equity Interests in each Guarantor;

         WHEREAS, the Borrower and each of the Guarantors, though separate legal
entities,  are  mutually  dependent  on  each  other  in the  conduct  of  their
respective businesses as an integrated operation and have determined it to be in
their mutual best interests to obtain  financing from the Agent, the Lenders and
the Swingline Lender through their collective efforts;

         WHEREAS,  each Guarantor  acknowledges  that it will receive direct and
indirect  benefits from the Agent,  the Lenders and the Swingline  Lender making
such  financial  accommodations  available  to the  Borrower  under  the  Credit
Agreement  and,  accordingly,   each  Guarantor  is  willing  to  guarantee  the
Borrower's obligations to the Agent, the Lenders and the Swingline Lender on the
terms and conditions contained herein; and

         WHEREAS,  each Guarantor's execution and delivery of this Guaranty is a
condition to the Agent and the Lenders  making,  and  continuing  to make,  such
financial accommodations to the Borrower.

         NOW, THEREFORE,  for good and valuable  consideration,  the receipt and
sufficiency of which are hereby  acknowledged by each Guarantor,  each Guarantor
agrees as follows:

         Section 1. Guaranty. Each Guarantor hereby absolutely,  irrevocably and
unconditionally  guaranties the due and punctual  payment and  performance  when
due,  whether at stated  maturity,  by acceleration or otherwise,  of all of the
following  (collectively referred to as the "Guarantied  Obligations"):  (a) all
indebtedness and obligations owing by the Borrower to any Lender,  the

                                      P-1
<PAGE>

Swingline  Lender or the Agent under or in connection with the Credit  Agreement
and any other Loan Document,  including without limitation, the repayment of all
principal  of the  Revolving  Loans,  Bid Rate  Loans,  Swingline  Loans and the
Reimbursement  Obligations,  and the  payment of all  interest,  Fees,  charges,
attorneys' fees and other amounts payable to any Lender or the Agent  thereunder
or in connection therewith; (b) any and all extensions, renewals, modifications,
amendments or  substitutions  of the  foregoing;  (c) all  expenses,  including,
without  limitation,  reasonable  attorneys'  fees and  disbursements,  that are
incurred by the Lenders and the Agent in the enforcement of any of the foregoing
or any obligation of such Guarantor hereunder; and (d) all other Obligations.

         Section 2. Guaranty of Payment and Not of Collection.  This Guaranty is
a guaranty of payment,  and not of collection,  and a debt of each Guarantor for
its own account.  Accordingly,  none of the Lenders, the Swingline Lender or the
Agent shall be obligated or required before  enforcing this Guaranty against any
Guarantor:  (a) to pursue any right or remedy any of them may have  against  the
Borrower,  any other Guarantor or any other Person or commence any suit or other
proceeding against the Borrower,  any other Guarantor or any other Person in any
court or other tribunal; (b) to make any claim in a liquidation or bankruptcy of
the Borrower,  any other Guarantor or any other Person; or (c) to make demand of
the Borrower,  any other  Guarantor or any other Person or to enforce or seek to
enforce  or  realize  upon any  collateral  security  held by the  Lenders,  the
Swingline   Lender  or  the  Agent  which  may  secure  any  of  the  Guarantied
Obligations.

         Section  3.  Guaranty  Absolute.  Each  Guarantor  guarantees  that the
Guarantied Obligations will be paid strictly in accordance with the terms of the
documents evidencing the same, regardless of any Applicable Law now or hereafter
in effect in any  jurisdiction  affecting any of such terms or the rights of the
Agent, the Lenders or the Swingline  Lender with respect thereto.  The liability
of each  Guarantor  under  this  Guaranty  shall be  absolute,  irrevocable  and
unconditional  in  accordance  with its terms and shall remain in full force and
effect  without  regard to, and shall not be  released,  suspended,  discharged,
terminated or otherwise affected by, any circumstance or occurrence  whatsoever,
including  without  limitation,  the  following  (whether or not such  Guarantor
consents thereto or has notice thereof):

         (a) (i) any change in the  amount,  interest  rate or due date or other
term of any of the Guarantied Obligations, (ii) any change in the time, place or
manner of payment of all or any portion of the Guarantied Obligations, (iii) any
amendment  or waiver of, or consent to the  departure  from or other  indulgence
with respect to, the Credit  Agreement,  any other Loan  Document,  or any other
document or instrument evidencing or relating to any Guarantied Obligations,  or
(iv) any waiver,  renewal,  extension,  addition,  or supplement to, or deletion
from,  or any other  action or  inaction  under or in  respect  of,  the  Credit
Agreement, any of the other Loan Documents, or any other documents,  instruments
or agreements relating to the Guarantied  Obligations or any other instrument or
agreement  referred to therein or evidencing any  Guarantied  Obligations or any
assignment or transfer of any of the foregoing;

                                      P-2
<PAGE>

         (b) any lack of validity or enforceability of the Credit Agreement, any
of the other Loan  Documents,  or any other  document,  instrument  or agreement
referred to therein or evidencing any  Guarantied  Obligations or any assignment
or transfer of any of the foregoing;

         (c) any furnishing to the Agent, the Lenders or the Swingline Lender of
any security for the Guarantied Obligations,  or any sale, exchange,  release or
surrender of, or realization on, any collateral securing any of the Obligations;

         (d) any settlement or compromise of any of the Guarantied  Obligations,
any security  therefor,  or any liability of any other party with respect to the
Guarantied  Obligations,  or any  subordination of the payment of the Guarantied
Obligations  to the payment of any other  liability of the Borrower or any other
Loan Party;

         (e)   any   bankruptcy,   insolvency,   reorganization,    composition,
adjustment,  dissolution,  liquidation or other like proceeding relating to such
Guarantor, the Borrower, any other Loan Party or any other Person, or any action
taken with respect to this Guaranty by any trustee or receiver, or by any court,
in any such proceeding;

         (f) any act or failure to act by the Borrower,  any other Loan Party or
any other Person which may adversely affect such Guarantor's subrogation rights,
if any, against the Borrower to recover payments made under this Guaranty;

         (g) any  nonperfection or impairment of any security  interest or other
Lien on any collateral, if any, securing in any way any of the Obligations;

         (h) any  application of sums paid by the Borrower,  any other Guarantor
or any other  Person  with  respect to the  liabilities  of the  Borrower to the
Agent,  the Lenders or the Swingline  Lender,  regardless of what liabilities of
the Borrower remain unpaid;

         (i) any defect,  limitation or insufficiency in the borrowing powers of
the Borrower or in the exercise thereof; or

         (j) any other circumstance  which might otherwise  constitute a defense
available to, or a discharge of, a Guarantor  hereunder (other than indefeasible
payment in full).

         Section 4. Action with Respect to Guarantied  Obligations.  The Lenders
and the Agent may, at any time and from time to time, without the consent of, or
notice to,  any  Guarantor,  and  without  discharging  any  Guarantor  from its
obligations  hereunder,  take any and all actions described in Section 3 and may
otherwise:  (a)  amend,  modify,  alter or  supplement  the  terms of any of the
Guarantied Obligations,  including,  but not limited to, extending or shortening
the  time of  payment  of any of the  Guarantied  Obligations  or  changing  the
interest rate that may accrue on any of the Guarantied  Obligations;  (b) amend,
modify, alter or supplement the Credit Agreement or any other Loan Document; (c)
sell,  exchange,  release  or  otherwise  deal  with all,  or any  part,  of any
collateral securing any of the Obligations;  (d) release any other Loan Party or
other  Person  liable  in any  manner  for  the  payment  or  collection  of the
Guarantied  Obligations;  (e) exercise,  or

                                      P-3
<PAGE>

refrain from exercising, any rights against the Borrower, any other Guarantor or
any other Person; and (f) apply any sum, by whomsoever paid or however realized,
to the Guarantied Obligations in such order as the Lenders shall elect.

         Section 5. Representations and Warranties.  Each Guarantor hereby makes
to the Agent,  the Lenders and the Swingline  Lender all of the  representations
and  warranties  made by the Borrower  with respect to or in any way relating to
such Guarantor in the Credit  Agreement and the other Loan Documents,  as if the
same were set forth herein in full.

         Section 6.  Covenants.  Each  Guarantor  will comply with all covenants
which the Borrower is to cause such  Guarantor to comply with under the terms of
the Credit Agreement or any of the other Loan Documents.

         Section 7. Waiver.  Each Guarantor,  to the fullest extent permitted by
Applicable  Law, hereby waives notice of acceptance  hereof or any  presentment,
demand,  protest or notice of any kind, and any other act or thing,  or omission
or delay to do any  other  act or thing,  which in any  manner or to any  extent
might  vary the risk of such  Guarantor  or which  otherwise  might  operate  to
discharge such Guarantor from its obligations hereunder.

         Section 8.  Inability to Accelerate  Loan. If the Agent,  the Swingline
Lender and/or the Lenders are prevented  under  Applicable Law or otherwise from
demanding or accelerating payment of any of the Guarantied Obligations by reason
of any automatic stay or otherwise,  the Agent,  the Swingline Lender and/or the
Lenders shall be entitled to receive from each Guarantor,  upon demand therefor,
the sums which  otherwise  would have been due had such  demand or  acceleration
occurred.

         Section 9.  Reinstatement of Guarantied  Obligations.  If claim is ever
made on the Agent,  any Lender or the Swingline Lender for repayment or recovery
of any  amount or  amounts  received  in  payment  or on  account  of any of the
Guarantied  Obligations,  and the Agent,  such  Lender or the  Swingline  Lender
repays all or part of said amount by reason of (a) any judgment, decree or order
of any  court  or  administrative  body of  competent  jurisdiction,  or (b) any
settlement or compromise of any such claim effected by the Agent, such Lender or
the Swingline Lender with any such claimant (including the Borrower or a trustee
in bankruptcy  for the Borrower),  then and in such event each Guarantor  agrees
that any such judgment, decree, order, settlement or compromise shall be binding
on it,  notwithstanding  any revocation hereof or the cancellation of the Credit
Agreement,  any of the other Loan Documents,  or any other instrument evidencing
any liability of the Borrower,  and such Guarantor shall be and remain liable to
the Agent,  such  Lender or the  Swingline  Lender for the  amounts so repaid or
recovered to the same extent as if such amount had never originally been paid to
the Agent, such Lender or the Swingline Lender.

         Section  10.  Subrogation.  Upon the  making  by any  Guarantor  of any
payment  hereunder  for the account of the  Borrower,  such  Guarantor  shall be
subrogated to the rights of the payee against the Borrower;  provided,  however,
that such Guarantor shall not enforce any right or receive any payment by way of
subrogation  or otherwise take any action in respect of any other

                                      P-4
<PAGE>

claim or cause of action such Guarantor may have against the Borrower arising by
reason  of any  payment  or  performance  by  such  Guarantor  pursuant  to this
Guaranty,  unless  and  until  all  of  the  Guarantied  Obligations  have  been
indefeasibly  paid and  performed  in full.  If any amount shall be paid to such
Guarantor on account of or in respect of such subrogation rights or other claims
or causes of action,  such  Guarantor  shall  hold such  amount in trust for the
benefit of the Agent,  the Lenders and the Swingline  Lender and shall forthwith
pay such amount to the Agent to be credited and applied  against the  Guarantied
Obligations,  whether matured or unmatured,  in accordance with the terms of the
Credit  Agreement  or to be held by the  Agent as  collateral  security  for any
Guarantied Obligations existing.

         Section 11. Payments Free and Clear. All sums payable by each Guarantor
hereunder,   whether  of  principal,   interest,  Fees,  expenses,  premiums  or
otherwise,  shall  be paid in  full,  without  set-off  or  counterclaim  or any
deduction or withholding  whatsoever (including any Taxes), and if any Guarantor
is required by Applicable  Law or by a  Governmental  Authority to make any such
deduction or withholding, such Guarantor shall pay to the Agent, the Lenders and
the Swingline Lender such additional amount as will result in the receipt by the
Agent, the Lenders and the Swingline Lender of the full amount payable hereunder
had such deduction or withholding not occurred or been required.

         Section 12. Set-off. In addition to any rights now or hereafter granted
under  any of the  other  Loan  Documents  or  Applicable  Law and not by way of
limitation of any such rights,  each Guarantor  hereby  authorizes the Agent and
each Lender, at any time during the continuance of an Event of Default,  without
any prior notice to such Guarantor or to any other Person, any such notice being
hereby expressly  waived,  but in the case of a Lender subject to receipt of the
prior written consent of the Agent exercised in its sole discretion,  to set off
and to  appropriate  and to apply  any and all  deposits  (general  or  special,
including,  but not  limited  to,  indebtedness  evidenced  by  certificates  of
deposit,  whether  matured or unmatured) and any other  indebtedness at any time
held or owing by the Agent,  such Lender,  or any affiliate of the Agent or such
Lender,  to or for the credit or the  account of such  Guarantor  against and on
account of any of the Guarantied Obligations, although such obligations shall be
contingent or unmatured.  Each Guarantor agrees, to the fullest extent permitted
by  Applicable  Law,  that any  Participant  may  exercise  rights  of setoff or
counterclaim  and other rights with respect to its  participation as fully as if
such  Participant were a direct creditor of such Guarantor in the amount of such
participation.

         Section 13.  Subordination.  Each Guarantor hereby expressly  covenants
and agrees for the benefit of the Agent,  the Lenders and the  Swingline  Lender
that all  obligations  and  liabilities  of the  Borrower to such  Guarantor  of
whatever description, including without limitation, all intercompany receivables
of such Guarantor from the Borrower (collectively, the "Junior Claims") shall be
subordinate and junior in right of payment to all Guarantied Obligations.  If an
Event of Default shall have occurred and be continuing,  then no Guarantor shall
accept any direct or indirect  payment  (in cash,  property  or  securities,  by
setoff or otherwise) from the Borrower on account of or in any manner in respect
of  any  Junior  Claim  until  all  of  the  Guarantied  Obligations  have  been
indefeasibly paid in full.

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<PAGE>

         Section 14. Avoidance  Provisions.  It is the intent of each Guarantor,
the Agent,  the Lenders and the Swingline  Lender that in any  Proceeding,  such
Guarantor's  maximum  obligation  hereunder  shall  equal,  but not exceed,  the
maximum amount which would not otherwise cause the obligations of such Guarantor
hereunder (or any other  obligations of such Guarantor to the Agent, the Lenders
and  the  Swingline  Lender)  to be  avoidable  or  unenforceable  against  such
Guarantor in such  Proceeding as a result of Applicable Law,  including  without
limitation,  (a) Section 548 of the  Bankruptcy  Code of 1978,  as amended  (the
"Bankruptcy  Code")  and  (b)  any  state  fraudulent   transfer  or  fraudulent
conveyance  act or  statute  applied  in such  Proceeding,  whether by virtue of
Section 544 of the Bankruptcy Code or otherwise. The Applicable Laws under which
the possible avoidance or  unenforceability of the obligations of such Guarantor
hereunder (or any other  obligations of such Guarantor to the Agent, the Lenders
and the  Swingline  Lender)  shall  be  determined  in any such  Proceeding  are
referred to as the "Avoidance Provisions".  Accordingly,  to the extent that the
obligations of any Guarantor  hereunder  would otherwise be subject to avoidance
under the Avoidance  Provisions,  the maximum  Guarantied  Obligations for which
such Guarantor shall be liable  hereunder shall be reduced to that amount which,
as of the  time  any of the  Guarantied  Obligations  are  deemed  to have  been
incurred under the Avoidance Provisions, would not cause the obligations of such
Guarantor  hereunder (or any other  obligations  of such Guarantor to the Agent,
the Lenders and the  Swingline  Lender),  to be subject to  avoidance  under the
Avoidance Provisions.  This Section is intended solely to preserve the rights of
the Agent,  the Lenders and the Swingline Lender hereunder to the maximum extent
that would not cause the obligations of any Guarantor hereunder to be subject to
avoidance under the Avoidance  Provisions,  and no Guarantor or any other Person
shall have any right or claim  under this  Section  as  against  the Agent,  the
Lenders and the  Swingline  Lender that would not otherwise be available to such
Person under the Avoidance Provisions.

         Section 15. Information.  Each Guarantor assumes all responsibility for
being and keeping itself informed of the financial condition of the Borrower and
the other Guarantors,  and of all other  circumstances  bearing upon the risk of
nonpayment of any of the Guarantied Obligations and the nature, scope and extent
of the risks that such Guarantor assumes and incurs  hereunder,  and agrees that
none of the Agent,  the  Lenders  or the  Swingline  Lender  shall have any duty
whatsoever to advise any Guarantor of information  regarding such  circumstances
or risks.

         Section 16.  Governing  Law. THIS  AGREEMENT  SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE  WITH,  THE LAWS OF THE STATE OF NEW YORK  APPLICABLE TO
CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.

         Section 17.  Waiver of jury trial.

         (a) EACH PARTY  HERETO  ACKNOWLEDGES  THAT ANY  DISPUTE OR  CONTROVERSY
BETWEEN OR AMONG ANY  GUARANTOR,  THE AGENT OR ANY OF THE LENDERS WOULD BE BASED
ON  DIFFICULT  AND COMPLEX  ISSUES OF LAW AND FACT AND WOULD RESULT IN DELAY AND
EXPENSE TO THE PARTIES.  ACCORDINGLY, TO THE EXTENT PERMITTED BY APPLICABLE LAW,
EACH OF THE

                                      P-6
<PAGE>

LENDERS, THE AGENT AND EACH GUARANTOR HEREBY WAIVES ITS RIGHT TO A TRIAL BY JURY
IN ANY ACTION OR  PROCEEDING  OF ANY KIND OR NATURE IN ANY COURT OR  TRIBUNAL IN
WHICH AN ACTION MAY BE COMMENCED  BY OR AGAINST ANY PARTY HERETO  ARISING OUT OF
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR BY REASON OF ANY OTHER SUIT,  CAUSE
OF ACTION OR DISPUTE WHATSOEVER BETWEEN OR AMONG THE BORROWER,  THE AGENT OR ANY
OF THE LENDERS OF ANY KIND OR NATURE.

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

         (c) THE  PROVISIONS OF THIS SECTION HAVE BEEN  CONSIDERED BY EACH PARTY
WITH  THE  ADVICE  OF  COUNSEL  AND  WITH A  FULL  UNDERSTANDING  OF  THE  LEGAL
CONSEQUENCES  THEREOF,  AND SHALL SURVIVE THE PAYMENT OF THE LOANS AND ALL OTHER
AMOUNTS PAYABLE  HEREUNDER OR UNDER THE OTHER LOAN DOCUMENTS AND THE TERMINATION
OF THIS GUARANTY.

         Section 18. Loan  Accounts.  The Agent,  each Lender and the  Swingline
Lender may maintain  books and accounts  setting forth the amounts of principal,
interest  and  other  sums  paid and  payable  with  respect  to the  Guarantied
Obligations,  and in the case of any dispute  relating to any of the outstanding
amount,  payment or receipt of any of the  Guarantied  Obligations or otherwise,
the entries in such books and accounts  shall be deemed prima facie  evidence of
the amounts and other  matters set forth herein.  The failure of the Agent,  any
Lender or the Swingline  Lender to maintain such books and accounts shall not in
any way relieve or discharge any Guarantor of any of its obligations hereunder.

                                      P-7
<PAGE>

         Section 19. Waiver of Remedies.  No delay or failure on the part of the
Agent, any Lender or the Swingline Lender in the exercise of any right or remedy
it may have against any  Guarantor  hereunder or  otherwise  shall  operate as a
waiver thereof,  and no single or partial  exercise by the Agent,  any Lender or
the  Swingline  Lender of any such right or remedy  shall  preclude any other or
further exercise thereof or the exercise of any other such right or remedy.

         Section 20.  Termination.  This Guaranty shall remain in full force and
effect until indefeasible payment in full of the Guarantied  Obligations and the
other Obligations and the termination or cancellation of the Credit Agreement in
accordance with its terms.

         Section 21. Successors and Assigns.  Each reference herein to the Agent
or the Lenders  shall be deemed to include such Person's  respective  successors
and  assigns  (including,  but not  limited  to,  any  holder of the  Guarantied
Obligations)  in whose favor the  provisions  of this Guaranty also shall inure,
and each  reference  herein to each  Guarantor  shall be deemed to include  such
Guarantor's  successors  and  assigns,  upon whom this  Guaranty  also  shall be
binding.  The Lenders and the  Swingline  Lender  may,  in  accordance  with the
applicable  provisions  of the Credit  Agreement,  assign,  transfer or sell any
Guarantied  Obligation,  or  grant  or  sell  participations  in any  Guarantied
Obligations,  to any Person  without the consent of, or notice to, any Guarantor
and without  releasing,  discharging  or modifying any  Guarantor's  obligations
hereunder.  Each Guarantor  hereby  consents to the delivery by the Agent or any
Lender  to  any  Assignee  or  Participant  (or  any  prospective   Assignee  or
Participant) of any financial or other information regarding the Borrower or any
Guarantor.  No Guarantor may assign or transfer its obligations hereunder to any
Person without the prior written  consent of all Lenders and any such assignment
or other  transfer to which all of the Lenders  have not so  consented  shall be
null and void.

         Section  22.  Joint and Several  Obligations.  the  obligationS  of the
Guarantors HEREUNDER SHALL BE joint and several, and ACCORDINGLY, each Guarantor
CONFIRMS THAT IT is liable for the full amount of the  "GUARANTiED  Obligations"
AND ALL OF THE  OBLIGATIONS  AND  LIABILITIES  OF EACH OF THE  OTHER  gUARANTORS
HEREUNDER.

         Section 23.  Amendments.  This  Guaranty  may not be amended  except in
writing signed by the Requisite Lenders (or all of the Lenders if required under
the terms of the Credit Agreement), the Agent and each Guarantor.

         Section 24. Payments. All payments to be made by any Guarantor pursuant
to this Guaranty shall be made in Dollars, in immediately available funds to the
Agent at the  Principal  Office,  not later than 2:00 p.m. on the date of demand
therefor.

         Section 25.  Notices.  All notices,  requests and other  communications
hereunder  shall be in  writing  (including  facsimile  transmission  or similar
writing) and shall be given (a) to each Guarantor at its address set forth below
its signature  hereto,  (b) to the Agent,  any Lender or the Swingline Lender at
its respective address for notices provided for in the Credit Agreement,  or (c)
as to each such party at such other  address as such party shall  designate in a
written  notice  to

                                      P-8
<PAGE>

the other parties.  Each such notice,  request or other  communication  shall be
effective (i) if mailed, when received; (ii) if telecopied, when transmitted; or
(iii) if hand delivered, when delivered; provided, however, that any notice of a
change of address for notices shall not be effective until received.

         Section 26. Severability.  In case any provision of this Guaranty shall
be invalid, illegal or unenforceable in any jurisdiction, the validity, legality
and enforceability of the remaining  provisions shall not in any way be affected
or impaired thereby.

         Section 27.  Headings.  Section  headings used in this Guaranty are for
convenience only and shall not affect the construction of this Guaranty.

         Section 28.  Trustees, Etc. Not Liable.

         IN THE CASE OF ANY  GUARANTOR  THAT IS A TRUST,  NO  TRUSTEE,  OFFICER,
SHAREHOLDER,  EMPLOYEE OR AGENT OF SUCH GUARANTOR  SHALL BE HELD TO ANY PERSONAL
LIABILITY,  JOINTLY OR SEVERALLY,  FOR ANY OBLIGATION OF, OR CLAIM AGAINST, SUCH
GUARANTOR.  ALL PERSONS DEALING WITH SUCH GUARANTOR, IN ANY WAY, SHALL LOOK ONLY
TO THE ASSETS OF SUCH GUARANTOR FOR THE PAYMENT OF ANY SUM OR THE PERFORMANCE OF
ANY OBLIGATION OWING BY SUCH GUARANTOR HEREUNDER. THE PROVISIONS OF THIS SECTION
SHALL NOT LIMIT ANY OBLIGATIONS OF ANY LOAN PARTY.

         Section 29.  Limitation of Liability.

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

         Section 30.  Definitions.  (a) For the purposes of this Guaranty:

         "Proceeding" means any of the following: (i) a voluntary or involuntary
case  concerning any Guarantor  shall be commenced  under the Bankruptcy Code of
1978, as amended;  (ii) a custodian (as defined in such  Bankruptcy  Code or any
other  applicable  bankruptcy laws) is appointed for, or takes charge of, all or
any  substantial  part  of  the  property  of any  Guarantor;  (iii)  any  other
proceeding  under  any  Applicable  Law,   domestic  or  foreign,   relating  to
bankruptcy,

                                      P-9
<PAGE>

insolvency,  reorganization,  winding-up or composition for adjustment of debts,
whether now or hereafter in effect, is commenced relating to any Guarantor; (iv)
any Guarantor is adjudicated  insolvent or bankrupt;  (v) any order of relief or
other  order  approving  any such case or  proceeding  is  entered by a court of
competent  jurisdiction;  (vi) any Guarantor makes a general  assignment for the
benefit of creditors; (vii) any Guarantor shall fail to pay, or shall state that
it is unable to pay,  or shall be unable  to pay,  its debts  generally  as they
become due;  (viii) any Guarantor  shall call a meeting of its creditors  with a
view to arranging a composition  or adjustment of its debts;  (ix) any Guarantor
shall by any act or failure to act  indicate  its  consent  to,  approval  of or
acquiescence in any of the foregoing; or (x) any corporate action shall be taken
by any Guarantor for the purpose of effecting any of the foregoing.

         (b)  Terms  not  otherwise  defined  herein  are used  herein  with the
respective meanings given them in the Credit Agreement.

                            [Signature on Next Page]

                                      P-10
<PAGE>

         IN WITNESS WHEREOF, each Guarantor has duly executed and delivered this
Guaranty as of the date and year first written above.

                                 HUB LA PROPERTIES TRUST

                                 By:___________________________________________
                                    Name: John Popeo
                                    Title:  Treasurer and Secretary

                                 HUB REALTY COLLEGE PARK, INC.

                                 By:___________________________________________
                                    Name:  John Popeo
                                    Title: Treasurer and Secretary

                                 HUB REALTY COLLEGE PARK I, LLC

                                 By: Hub Management, Inc.

                                 ----------------------------------------------
                                 Name:  John A. Mannix
                                 Title:  President

                                 By: Hub Realty College Park, Inc.

                                 ----------------------------------------------
                                 Name:  John A. Mannix
                                 Title:  President

                                 HUB ACQUISITION TRUST

                                 By:___________________________________________
                                 Name:  John Popeo
                                 Title: Treasurer and Secretary

                                      P-11
<PAGE>

                                 1735 MARKET STREET PROPERTIES TRUST

                                 By:_________________________________________
                                 Name:  John Popeo
                                 Title: Treasurer and Secretary

                                 HEALTH AND RETIREMENT PROPERTIES
                                 INTERNATIONAL, INC.

                                 By:_________________________________________
                                 Name:  John Popeo
                                 Title: Treasurer and Secretary

                                 HUB MANAGEMENT, INC.

                                 By:_________________________________________
                                 Name:  John Popeo
                                 Title: Treasurer and Secretary

                                 HUB REALTY GOLDEN, INC.

                                 By:_________________________________________
                                 Name:  John Popeo
                                 Title: Treasurer and Secretary

                                 HUB REALTY FUNDING, INC.

                                 By:_________________________________________
                                 Name:  John Popeo
                                 Title: Treasurer and Secretary

                                 HUB RI PROPERTIES TRUST

                                 By:_________________________________________
                                 Name:  John Popeo
                                 Title: Treasurer and Secretary

                                      P-12
<PAGE>

                                 HUB WOODMONT INVESTMENT TRUST

                                 By:___________________________________________
                                 Name:  John Popeo
                                 Title: Treasurer and Secretary

                                 HUB WOODMONT LIMITED LIABILITY COMPANY

                                 By:  Hub Woodmont Investment Trust, its Manager

                                 -------------------------------
                                 Name:  John A. Mannix
                                 Title:  President

                                 NINE PENN CENTER PROPERTIES TRUST

                                 By:___________________________________________
                                 Name:  John Popeo
                                 Title: Treasurer and Secretary

                                 INDEMNITY COLLECTION CORPORATION

                                 By:___________________________________________
                                 Name:  John Popeo
                                 Title: Treasurer and Secretary

                                 RESEARCH PARK PROPERTIES TRUST

                                 By:___________________________________________
                                 Name:  John Popeo
                                 Title: Treasurer and Secretary

                                      P-13
<PAGE>

                                 ROSEDALE PROPERTIES TRUST

                                 By:___________________________________________
                                 Name:  John Popeo
                                 Title: Treasurer and Secretary

                                 4 MAGUIRE ROAD REALTY TRUST

                                 By:___________________________________________
                                 Name:  John Popeo
                                 Title:  Trustee

                                 47 HARVARD STREET REAL ESTATE TRUST

                                 By:___________________________________________
                                 Name:  John Popeo
                                 Title:  Trustee

                                 HRPT MEDICAL BUILDINGS REALTY TRUST

                                 By:___________________________________________
                                 Name:  John Popeo
                                 Title:  Trustee

                                      P-14
<PAGE>

                                 MOB REALTY TRUST

                                 By:___________________________________________
                                 Name:  John Popeo
                                 Title:  Trustee

                                 PUTNAM PLACE REALTY TRUST

                                 By:___________________________________________
                                 Name:  John Popeo
                                 Title:  Trustee
                                 145 UNIVERSITY AVENUE REALTY TRUST

                                 By:___________________________________________
                                 Name:  John Popeo
                                 Title:  Trustee

                                 HUB MA REALTY TRUST

                                 By:___________________________________________
                                 Name:  John Popeo
                                 Title:  Trustee

                                 CAUSEWAY HOLDINGS, INC.

                                 By:___________________________________________
                                 Name:  John Popeo
                                 Title:  Trustee

                                 HUB REALTY KANSAS CITY, INC.

                                 By:___________________________________________
                                 Name:  John Popeo
                                 Title:  Trustee

                                      P-15
<PAGE>

                                 HUB PROPERTIES TRUST

                                 By:___________________________________________
                                 Name:  John Popeo
                                 Title:  Trustee

                                 HUB LA LIMITED PARTNERSHIP

                                 By:  Hub LA Properties Trust,
                                        its General Partner

                                 ----------------------------------
                                 Name:  John A. Mannix
                                 Title:  President

                                 NINE PENN CENTER ASSOCIATES L.P.

                                 By:  Nine Penn Center Properties Trust,
                                        its General Partner

                                 ----------------------------------------------
                                 Name:  John A. Mannix
                                 Title:  President

                                 Address for Notices:
                                 c/o HRPT Properties Trust
                                 400 Centre Street
                                 Newton, Massachusetts  02458
                                 Attention:  John Popeo
                                 Telecopy Number:(617) 928-1305
                                 Telephone Number:(617) 332-3990

                                      P-16
<PAGE>

                                     ANNEX I

                           FORM OF ACCESSION AGREEMENT

         THIS ACCESSION  AGREEMENT dated as of ____________,  ____, executed and
delivered by ______________________,  a _____________ (the "New Subsidiary"), in
favor of (a) FIRST UNION  NATIONAL  BANK, in its capacity as Agent (the "Agent")
for the Lenders under that certain Credit  Agreement  dated as of April __, 2001
(as amended, restated, supplemented or otherwise modified from time to time, the
"Credit  Agreement"),  by and among HRPT Properties Trust (the "Borrower"),  the
financial  institutions  party  thereto and their  assignees  under Section 12.5
thereof (the "Lenders"),  the Agent, and the other parties thereto,  and (b) the
Lenders and the Swingline Lender.

         WHEREAS,  pursuant to the Credit Agreement,  the Agent, the Lenders and
the  Swingline  Lender have agreed to make  available  to the  Borrower  certain
financial  accommodations  on the terms and  conditions  set forth in the Credit
Agreement;

         WHEREAS, the Borrower owns, directly or indirectly, at least a majority
of the issued and outstanding Equity Interests in the New Subsidiary;

         WHEREAS, the Borrower, the New Subsidiary, and the existing Guarantors,
though  separate  legal  entities,  are mutually  dependent on each other in the
conduct of their  respective  businesses  as an  integrated  operation  and have
determined it to be in their mutual best interests to obtain  financing from the
Agent, the Lenders and the Swingline Lender through their collective efforts;

         WHEREAS,  the New Subsidiary  acknowledges  that it will receive direct
and  indirect  benefits  from the Agent,  the Lenders and the  Swingline  Lender
making such financial  accommodations available to the Borrower under the Credit
Agreement  and,  accordingly,  the New  Subsidiary  is willing to guarantee  the
Borrower's obligations to the Agent, the Lenders and the Swingline Lender on the
terms and conditions contained herein; and

         WHEREAS, the New Subsidiary's  execution and delivery of this Agreement
is a condition to the Agent, the Lenders and the Swingline Lender  continuing to
make such financial accommodations to the Borrower.

         NOW, THEREFORE,  for good and valuable  consideration,  the receipt and
sufficiency  of which are hereby  acknowledged  by the New  Subsidiary,  the New
Subsidiary agrees as follows:

         Section 1. Accession to Guaranty. The New Subsidiary hereby agrees that
it is a "Guarantor"  under that certain  Guaranty dated as of April 30, 2001 (as
amended,  supplemented,  restated or otherwise  modified from time to time,  the
"Guaranty"), made by each Subsidiary of the Borrower a party thereto in favor of
the Agent, the Lenders and the Swingline Lender and assumes all obligations of a
"Guarantor"  thereunder,  all as if the New  Subsidiary  had  been  an

                                      P-17
<PAGE>

original  signatory to the  Guaranty.  Without  limiting the  generality  of the
foregoing, the New Subsidiary hereby:

         (a)  irrevocably  and  unconditionally  guarantees the due and punctual
payment and performance when due, whether at stated maturity, by acceleration or
otherwise, of all Guarantied Obligations (as defined in the Guaranty);

         (b) makes to the Agent,  the Lenders and the Swingline Lender as of the
date hereof each of the representations and warranties contained in Section 5 of
the  Guaranty  and  agrees  to be bound by each of the  covenants  contained  in
Section 6 of the Guaranty; and

         (c) consents and agrees to each provision set forth in the Guaranty.

         SECTION 2.  GOVERNING  LAW.  THIS  AGREEMENT  SHALL BE GOVERNED BY, AND
CONSTRUED  AND ENFORCED IN  ACCORDANCE  WITH,  THE LAWS OF THE STATE OF NEW YORK
APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.

         Section 3. Definitions. Capitalized terms used herein and not otherwise
defined herein shall have their  respective  defined  meanings given them in the
Credit Agreement.

                            [Signatures on Next Page]

                                      P-18
<PAGE>

         IN  WITNESS  WHEREOF,  the New  Subsidiary  has caused  this  Accession
Agreement to be duly  executed and delivered  under seal by its duly  authorized
officers as of the date first written above.

                                 NEW SUBSIDIARY]

                                 y:___________________________________________
                                     Name:____________________________________
                                     Title:___________________________________

                                 ddress for Notices:
                                 /o HRPT Properties Trust
                                 00 Centre Street
                                 ewton, Massachusetts  02458
                                 ttention:________
                                 elecopy Number:(___) ___-____
                                 elephone Number:(617) 332-3990

Accepted:

FIRST UNION NATIONAL BANK,
   as Agent

By:
   -------------------------------
     Name:
          ------------------------
     Title:
           -----------------------

                                      P-19

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