Document:

Exhibit
10.4

 

Execution
Version

 

TERM LOAN CREDIT AGREEMENT

 

Dated as of November 4, 2003

 

among

 

U.S. 
RESTAURANT PROPERTIES OPERATING L.P. (“USRP Operating”),

USRP FUNDING 2002-A, L.P. (the “General SPE”),

USRP (S&C), LLC, a Texas limited liability company
(“S&C”),

USRP (JV1), LLC, a Texas limited liability company
(“JV1”),

USRP/HCI PARTNERSHIP 1, L.P., a Texas limited
partnership (“HCI”),

USRP HOLDING CORP., a Texas corporation (“USRP
Holding),

collectively, the “Borrower,”

 

USRP MANAGING, INC. (the “General Partner”),

the General Partner of the Borrower, as a Guarantor,

 

U.S. 
RESTAURANT PROPERTIES, INC. (the “USRP REIT”),

as a Guarantor,

 

and

 

THE SUBSIDIARIES OF THE BORROWER, GENERAL PARTNER AND
THE USRP REIT

FROM TIME TO TIME PARTY HERETO,

as guarantors (the “Guarantors”),

 

THE LENDERS

FROM TIME TO TIME PARTY HERETO (the “Lenders”),

 

BANK OF AMERICA, N.A.

as agent (the “Agent”)

 

and

 

BANC OF AMERICA SECURITIES LLC,

as Sole Lead Arranger and Sole Book Manager

 

 

TABLE OF CONTENTS

 

	
  ARTICLE I 
  DEFINITIONS

  
	
   

  	
  1.1

  	
  Definitions.

  
	
   

  	
  1.2

  	
  Computation of Time
  Periods.

  
	
   

  	
  1.3

  	
  Accounting
  Terms.

  
	
   

  	
  1.4

  	
  References to
  Agreements and Laws.

  
	
   

  	
  1.5

  	
  Times of Day.

  
	
  ARTICLE II 
  CREDIT FACILITIES

  
	
   

  	
  2.1

  	
  Term Loans.

  
	
   

  	
  2.2

  	
  Joint and
  Several Liability of the Borrowers.

  
	
   

  	
  2.3

  	
  Appointment
  of Principal Borrower as Agent for Borrowers.

  
	
  ARTICLE III  OTHER PROVISIONS RELATING TO CREDIT FACILITIES

  
	
   

  	
  3.1

  	
  Default Rate.

  
	
   

  	
  3.2

  	
  Continuation/Conversion.

  
	
   

  	
  3.3

  	
  Prepayments.

  
	
   

  	
  3.4

  	
  Intentionally
  Omitted.

  
	
   

  	
  3.5

  	
  Fees.

  
	
   

  	
  3.6

  	
  Capital
  Adequacy.

  
	
   

  	
  3.7

  	
  Limitation on Eurodollar
  Loans.

  
	
   

  	
  3.8

  	
  Illegality.

  
	
   

  	
  3.9

  	
  Requirements
  of Law.

  
	
   

  	
  3.10

  	
  Treatment of Affected
  Loans.

  
	
   

  	
  3.11

  	
  Taxes.

  
	
   

  	
  3.12

  	
  Compensation.

  
	
   

  	
  3.13

  	
  Pro Rata
  Treatment.

  
	
   

  	
  3.14

  	
  Sharing
  of Payments.

  
	
   

  	
  3.15

  	
  Payments, Computations,
  Etc.

  
	
   

  	
  3.16

  	
  Evidence of
  Debt.

  
	
   

  	
  3.17

  	
  Usury.

  
	
   

  	
  3.18

  	
  Agreement
  Regarding Interest and Charges.

  
	
   

  	
  3.19

  	
  Statements of Account.

  
	
   

  	
  3.20

  	
  Defaulting
  Lenders.

  
	
   

  	
  3.21

  	
  Assumptions
  Concerning Funding of Eurodollar Loans.

  
	
   

  	
  3.22

  	
  Release of
  HCI.

  
	
  ARTICLE IV 
  GUARANTY

  
	
   

  	
  4.1

  	
  The Guaranty.

  
	
   

  	
  4.2

  	
  Obligations Unconditional.

  
	
   

  	
  4.3

  	
  Reinstatement.

  
	
   

  	
  4.4

  	
  Certain Additional Waivers.

  
	
   

  	
  4.5

  	
  Remedies.

  
	
   

  	
  4.6

  	
  Rights
  of Contribution.

  
	
   

  	
  4.7

  	
  Guarantee of
  Payment; Continuing Guarantee.

  
	
  ARTICLE V 
  CONDITIONS

  
	
   

  	
  5.1

  	
  Closing
  Conditions.

  
	
   

  	
  5.2

  	
  Conditions to
  all Extensions of Credit.

  
	
  ARTICLE VI 
  REPRESENTATIONS AND WARRANTIES

  
	
   

  	
  6.1

  	
  Financial
  Condition.

  
	
   

  	
  6.2

  	
  No Material
  Change.

  
	
   

  	
  6.3

  	
  Organization and Good Standing.

  
	
   

  	
  6.4

  	
  Power;
  Authorization; Enforceable Obligations.

  
	
   

  	
  6.5

  	
  No Conflicts.

  
	
   

  	
  6.6

  	
  No Default.

  
	
   

  	
  6.7

  	
  Ownership.

  
	
   

  	
  6.8

  	
  Indebtedness.

  
	
   

  	
  6.9

  	
  Litigation.

  
	
   

  	
  6.10

  	
  Taxes.

  

 

i

 

	
   

  	
  6.11

  	
  Compliance
  with Law.

  
	
   

  	
  6.12

  	
  ERISA.

  
	
   

  	
  6.13

  	
  Corporate
  Structure; Capital Stock, etc.

  
	
   

  	
  6.14

  	
  Governmental Regulations,
  Etc.

  
	
   

  	
  6.15

  	
  Purpose
  of Loans; Termination of Replaced Credit Agreement.

  
	
   

  	
  6.16

  	
  Environmental
  Matters.

  
	
   

  	
  6.17

  	
  Intellectual
  Property.

  
	
   

  	
  6.18

  	
  Solvency.

  
	
   

  	
  6.19

  	
  Investments.

  
	
   

  	
  6.20

  	
  Principal
  Offices.

  
	
   

  	
  6.21

  	
  Disclosure.

  
	
   

  	
  6.22

  	
  No Burdensome Restrictions.

  
	
   

  	
  6.23

  	
  Brokers’ Fees.

  
	
   

  	
  6.24

  	
  Labor Matters.

  
	
   

  	
  6.25

  	
  Nature of
  Business.

  
	
   

  	
  6.26

  	
  REIT Status.

  
	
   

  	
  6.27

  	
  Bankruptcy Remote
  Borrowing Entity.

  
	
   

  	
  6.28

  	
  Closing Date
  Borrowing Base Assets.

  
	
   

  	
  6.29

  	
  Tax
  Shelter Regulations.

  
	
   

  	
  6.30

  	
  Representations
  and Warranties Under Revolving Credit Documents.

  
	
  ARTICLE VII  AFFIRMATIVE COVENANTS

  
	
   

  	
  7.1

  	
  Information
  Covenants.

  
	
   

  	
  7.2

  	
  Preservation
  of Existence, Franchises, Bankruptcy Remote Borrowing Entity Status and REIT
  Status.

  
	
   

  	
  7.3

  	
  Books and
  Records.

  
	
   

  	
  7.4

  	
  Compliance
  with Law.

  
	
   

  	
  7.5

  	
  Payment of
  Taxes and Other Indebtedness.

  
	
   

  	
  7.6

  	
  Insurance.

  
	
   

  	
  7.7

  	
  Maintenance
  of Property.

  
	
   

  	
  7.8

  	
  Performance of Obligations.

  
	
   

  	
  7.9

  	
  Use of Proceeds.

  
	
   

  	
  7.10

  	
  Audits/Inspections.

  
	
   

  	
  7.11

  	
  Financial
  Covenants.

  
	
   

  	
  7.12

  	
  New
  Subsidiaries.

  
	
   

  	
  7.13

  	
  ERISA
  Exemptions.

  
	
   

  	
  7.14

  	
  Further
  Assurances.

  
	
  ARTICLE VIII  NEGATIVE COVENANTS

  
	
   

  	
  8.1

  	
  Indebtedness.

  
	
   

  	
  8.2

  	
  Liens.

  
	
   

  	
  8.3

  	
  Nature of
  Business.

  
	
   

  	
  8.4

  	
  Consolidation,
  Merger, Dissolution, etc.

  
	
   

  	
  8.5

  	
  Asset
  Dispositions/Substitution of Assets.

  
	
   

  	
  8.6

  	
  Investments.

  
	
   

  	
  8.7

  	
  Restricted
  Payments.

  
	
   

  	
  8.8

  	
  Other
  Indebtedness.

  
	
   

  	
  8.9

  	
  Transactions with
  Affiliates.

  
	
   

  	
  8.10

  	
  Fiscal Year;
  Organizational Documents.

  
	
   

  	
  8.11

  	
  Limitation on
  Restricted Actions.

  
	
   

  	
  8.12

  	
  Contingent
  Obligations.

  
	
   

  	
  8.13

  	
  Sale
  Leasebacks.

  
	
   

  	
  8.14

  	
  Borrowing Base Asset
  Removal.

  
	
   

  	
  8.15

  	
  Negative
  Pledges/Liens.

  
	
   

  	
  8.16

  	
  Operating Lease
  Obligations.

  
	
   

  	
  8.17

  	
  No
  Foreign Subsidiaries.

  
	
   

  	
  8.18

  	
  Ground Leases.

  
	
   

  	
  8.19

  	
  ERISA
  Exemptions.

  

 

ii

 

	
   

  	
  8.20

  	
  Transfer
  of Assets to Non-Guarantor Subsidiaries and Affiliates.

  
	
   

  	
  8.21

  	
  Revolving
  Credit Document Covenants and Amendments.

  
	
  ARTICLE IX 
  EVENTS OF DEFAULT

  
	
   

  	
  9.1

  	
  Events of
  Default.

  
	
   

  	
  9.2

  	
  Acceleration;
  Remedies.

  
	
  ARTICLE X 
  AGENCY PROVISIONS

  
	
   

  	
  10.1

  	
  Appointment, Powers
  and Immunities.

  
	
   

  	
  10.2

  	
  Reliance by
  Agent.

  
	
   

  	
  10.3

  	
  Defaults.

  
	
   

  	
  10.4

  	
  Rights as a
  Lender.

  
	
   

  	
  10.5

  	
  Indemnification.

  
	
   

  	
  10.6

  	
  Non-Reliance on
  Agent and Other Lenders.

  
	
   

  	
  10.7

  	
  Successor Agent.

  
	
  ARTICLE XI 
  MISCELLANEOUS

  
	
   

  	
  11.1

  	
  Notices.

  
	
   

  	
  11.2

  	
  Right of Set-Off; Adjustments.

  
	
   

  	
  11.4

  	
  No Waiver; Remedies
  Cumulative.

  
	
   

  	
  11.5

  	
  Expenses; Indemnification.

  
	
   

  	
  11.6

  	
  Amendments, Waivers
  and Consents.

  
	
   

  	
  11.7

  	
  Counterparts.

  
	
   

  	
  11.8

  	
  Headings.

  
	
   

  	
  11.9

  	
  Survival.

  
	
   

  	
  11.10

  	
  Governing
  Law; Submission to Jurisdiction; Venue.

  
	
   

  	
  11.11

  	
  Severability.

  
	
   

  	
  11.12

  	
  Entirety.

  
	
   

  	
  11.13

  	
  Binding Effect;
  Termination.

  
	
   

  	
  11.14

  	
  Confidentiality.

  
	
   

  	
  11.15

  	
  Source of Funds.

  
	
   

  	
  11.16

  	
  Regulation D.

  
	
   

  	
  11.17

  	
  Conflict.

  
	
   

  	
  11.18

  	
  USA
  Patriot Act Notice.

  

 

iii

 

	
  SCHEDULES

  
	
   

  	
   

  	
   

  
	
  Schedule 1.1(a)

  	
   

  	
  Commitments/Loans

  
	
  Schedule 2.1(a)

  	
   

  	
  Lenders/Agent

  
	
  EXHIBITS

  
	
   

  	
   

  	
   

  
	
  Exhibit 1.1(a)

  	
   

  	
  Bankruptcy Remote Borrowing Entity
  Requirements

  
	
  Exhibit 2.1(b)(i)

  	
   

  	
  Form of Notice of Borrowing

  
	
  Exhibit 2.1(e)

  	
   

  	
  Form of Term Note

  
	
  Exhibit 3.2

  	
   

  	
  Form of Notice of
  Continuation/Conversion

  
	
  Exhibit 7.1(c)

  	
   

  	
  Form of Officer’s Compliance
  Certificate

  
	
  Exhibit 7.12

  	
   

  	
  Form of Joinder Agreement

  
	
  Exhibit 11.3(b)

  	
   

  	
  Form of Assignment and Assumption

  

 

iv

 

TERM
LOAN CREDIT AGREEMENT

 

THIS TERM LOAN CREDIT AGREEMENT,
dated as of November 4, 2003 (as amended, modified, restated or supplemented
from time to time, the “Credit Agreement”), is by and among U.S.  RESTAURANT PROPERTIES OPERATING L.P.,
a Delaware limited partnership (“USRP Operating” or the “Principal
Borrower”), USRP FUNDING 2002-A, L.P., a Texas limited partnership (the “General
SPE”);
USRP (S&C), LLC, a Texas limited liability company (“S&C”),
USRP
(JV1), LLC, a Texas limited liability company (“JV1”), USRP/HCI
PARTNERSHIP 1, L.P., a Texas limited partnership (“HCI”), USRP HOLDING
CORP., a Texas corporation (“USRP Holding”; and together with
the Principal Borrower, the General SPE, JV1, HCI and S&C, the “Borrower”),
USRP
MANAGING, INC., a Delaware corporation and the general partner of
USRP Operating, as a Guarantor (the “General Partner”), U.S.
RESTAURANT PROPERTIES, INC., a Maryland corporation, as a Guarantor
(“USRP REIT”), the Subsidiary Guarantors (as defined herein), the
Lenders (as defined herein), BANK OF AMERICA, N.A., as Agent for the
Lenders (in such capacity, the “Agent”) and BANC OF AMERICA SECURITIES LLC,
as Sole Lead Arranger and Sole Book Manager (in such capacity “BAS”).

 

W I T N
E S S E T H

 

WHEREAS, the
Borrowers have requested that the Lenders provide a term loan credit facility
in an aggregate amount equal to $35,000,000 (the “Credit Facility”) for
the purposes hereinafter set forth; and

 

WHEREAS, the
Lenders have agreed to make the requested Credit Facility available to the
Borrowers on the terms and conditions hereinafter set forth;

 

NOW, THEREFORE, IN CONSIDERATION of
the premises and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:

 

 

ARTICLE I

DEFINITIONS

 

1.1          Definitions.

 

As used in this
Credit Agreement, the following terms shall have the meanings specified below
unless the context otherwise requires:

 

“2001-A Term Securitization Documents” means
that certain Amended and Restated Indenture dated as of August 1, 2001 by and
among USRP Funding 2001-A, L.P., as issuer, Wells Fargo Bank Minnesota, N.A.,
as indenture trustee and MBIA Insurance Corporation, as certificate issuer and
all documents and instruments executed in connection therewith or pursuant to
the terms thereof, in each case as amended prior to the Closing Date.

 

“Adjusted Base Rate” means the Base Rate plus
1.50%.

 

“Adjusted Eurodollar Rate” means the Eurodollar
Rate plus 3.50%.

 

“Administrative
Questionnaire” means an Administrative Questionnaire in a form supplied by
the Agent.

 

“Advance” shall have the meaning assigned to
such term in Section 2.1(b).

 

“Affiliate” means, with respect to any Person,
any other Person (i) directly or indirectly controlling or controlled by
or under direct or indirect common control with such Person or
(ii) directly or indirectly owning or holding five percent (5%) or
more of the Capital Stock in such Person. 
For purposes of this definition, “control” when used with respect to any
Person means the power to direct the management and policies of such

 

 

Person, directly
or indirectly, whether through the ownership of voting securities, by contract
or otherwise; and the terms “controlling” and “controlled” have meanings
correlative to the foregoing.

 

“Agent” shall have the meaning assigned to such
term in the heading hereof, together with any successors or assigns.

 

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

 

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

 

“Asset Disposition” means any disposition
(including pursuant to a Sale and Leaseback Transaction) of any or all of the
Property (including without limitation the Capital Stock of a Subsidiary) of
any Consolidated Party whether by sale, lease (other than in the ordinary
course of business), licensing, transfer or otherwise, but other than pursuant
to any casualty or condemnation event.

 

“Asset Value” means, with respect to any given
parcel of Real Property for any given date of calculation, (a) if such Real
Property has been owned for at least one (1) year, the trailing twelve month
EBITDA from such Real Property as of such date of calculation and (b) if such
Real Property has been owned less than one (1) year, the annualized EBITDA from
such Real Property (based on the EBITDA from the date of acquisition through
such date of calculation), in each case, capitalized at ten and one half
percent (10.5%); provided, that (a) the Agent shall have the right, at its
discretion, to review the appropriateness of the capitalization rate on an
annual basis (such review period to commence on May 1 of each calendar year and
end as of June 1 of such calendar year); (b) the Required Lenders shall
have the right to adjust the capitalization rate during the Agent’s review
period each year (by an amount not to exceed +/- 0.50% in any given year) based
on then-prevailing market conditions for comparable property types (each as
determined by the Required Lenders) and on the Agent’s review and
recommendation; and (c) the applicable capitalization rate shall not at any
time, notwithstanding the provisions regarding adjustment thereof set forth
above, (i) exceed 11.5% or (ii) be less than 9.5%.

 

“Assignment and Assumption” means an assignment
and assumption entered into by a Lender and an Eligible Assignee (with the
consent of any party whose consent is required by Section 11.3, and accepted by
the Agent, in substantially the form of Exhibit 11.3 or any other
form approved by the Agent.

 

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

 

“Bankruptcy Event” means, with respect to any
Person, the occurrence of any of the following: (i) the entry of a decree
or order for relief by a court or governmental agency in an involuntary case
under any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, or the appointment by a court or governmental agency of a
receiver, liquidator, assignee, custodian, trustee, sequestrator (or similar
official) of such Person or for any substantial part of its Property or the
ordering of the winding up or liquidation of its affairs by a court or
governmental agency; or (ii) the commencement against such Person of an
involuntary case under any applicable bankruptcy, insolvency or other similar
law now or hereafter in effect, or of any case, proceeding or other action for
the appointment of a receiver, liquidator, assignee, custodian, trustee,
sequestrator (or similar official) of such Person or for any substantial part
of its Property or for the winding up or liquidation of its affairs, and such
involuntary case or other case, proceeding or other action shall remain
undismissed for a period of sixty (60) consecutive days, or the
repossession or seizure by a creditor of such Person of a substantial part of
its Property; or (iii) such Person shall commence a voluntary case under
any applicable bankruptcy, insolvency or other similar law now or hereafter in
effect, or consent to the entry of an order for relief in an involuntary case
under any such law, or consent to the appointment of or the taking

 

2

 

possession by a
receiver, liquidator, assignee, creditor in possession, custodian, trustee,
sequestrator (or similar official) of such Person or for any substantial part
of its Property or make any general assignment for the benefit of creditors; or
(iv) such Person shall be unable to, or shall admit in writing its
inability to, pay its debts generally as they become due.

 

“Bankruptcy
Remote Borrowing Entity” means a Person meeting
each of the criteria set forth on Exhibit 1.1(a) attached hereto.

 

“BAS” shall have the meaning given to such term
in the introductory paragraph hereof.

 

“Base Rate” means, for any day, the rate per
annum equal to the higher of (a) the Federal Funds Rate for such day plus
one-half of one percent (0.5%) and (b) the Prime Rate for such
day.  Any change in the Base Rate due to
a change in the Prime Rate or the Federal Funds Rate shall be effective on the
effective date of such change in the Prime Rate or Federal Funds Rate.

 

“Base Rate Loan” means any portion of the Loans
bearing interest at a rate determined by reference to the Base Rate.

 

“BOA” means Bank of America, N.A. and its
successors and assigns.

 

“Borrower” means, collectively, USRP Operating,
the General SPE, S&C, HCI, JV1, USRP Holding and their respective permitted
successors and assigns.

 

“Borrowing Base” means, as of any day, an
amount equal to the Borrowing Base Percentage multiplied by the Borrowing Base
Asset Value; provided, however, that, prior to such calculation, each of
clauses (a) through (c) below shall be satisfied with respect to the
assets contributing to the Borrowing Base Asset Value:

 

(a)           the assets of single Concepts or
Tenants shall not, in any case, account for more than twenty percent (20%)
(or, following the date on which the obligations under the Revolving Credit
Documents are Fully Satisfied, fifteen percent (15.0%)) of the Total Rent; to
the extent the assets of a single Concept or Tenant account for more than
twenty percent (20%) (or, following the date on which the obligations
under the Revolving Credit Documents are Fully Satisfied, fifteen percent
(15.0%)) of the Total Rent associated with the assets used in calculating
Borrowing Base Asset Value, the assets associated with such Concept or Tenant
shall be removed from the calculation of Borrowing Base Asset Value to the
extent necessary to reduce such Concept’s or Tenant’s percentage of the Total
Rent of the assets used in calculating Borrowing Base Asset Value to a portion equal
to or less than twenty percent (20%) (or, following the date on which the
obligations under the Revolving Credit Documents are Fully Satisfied, fifteen
percent (15.0%));

 

(b)           the portion of Borrowing Base Asset
Value attributable to Ground Lease Interests shall not, in any case, exceed
twenty percent (20%) (or, following the date on which the obligations
under the Revolving Credit Documents are Fully Satisfied, fifteen percent
(15.0%)) of the aggregate Borrowing Base Asset Value; to the extent Ground Lease
Interests constitute more than twenty percent (20%) (or, following the
date on which the obligations under the Revolving Credit Documents are Fully
Satisfied, fifteen percent (15.0%)) of the Borrowing Base Asset Value, the
Value of such Ground Lease Interests shall be removed from the calculation
thereof to the extent necessary to reduce the percentage associated with the
Ground Lease Interests as a portion of all of the assets used in calculating
Borrowing Base Asset Value to a portion equal to or less than twenty
percent (20%) (or, following the date on which the obligations under the
Revolving Credit Documents are Fully Satisfied, fifteen percent (15.0%)); and

 

(c)           the underlying leases with respect to
the Borrowing Base Assets pursuant to which Borrower is the lessor shall not,
in any case, have a weighted average remaining lease term of less than, (i) for
the period commencing as of the date hereof and ending as of (and including)
the date 24 calendar months thereafter, eight (8) years, (ii) for the
period commencing as of the day after the date which is

 

3

 

24 months
following the date hereof and ending as of (and including) the date 48 months
following the date hereof, seven (7) years, and (iii) for all periods
thereafter, six (6) years; to the extent the weighted average of the remaining
lease term(s) of the underlying leases with respect to the assets contributing
to the Borrowing Base Asset Value (with each such lease’s term given a
weighting in relation to the other leases involved in such calculation based on
the contribution of each such lease to the Borrowing Base Asset Value) is less
than the applicable required term of years, assets with remaining lease terms
of less than the applicable required term of years shall be removed from the
calculation of Borrowing Base Asset Value until the weighted average of the
remaining lease terms with respect to all such assets is equal to or greater
than the applicable required term of years.

 

“Borrowing Base Asset Value” means, as of any
given calculation date, an amount equal to (a) the sum of the Asset Values of
all Real Properties which are wholly owned by any of the General SPE, JV1 (or
Wholly-Owned Subsidiaries thereof), HCI (or Wholly-Owned Subsidiaries thereof)
or S&C; less (b) any amounts included in the above calculations that
are attributable to (i) assets subject to one or more Liens or Negative
Pledges; and (ii) Excluded Assets.

 

“Borrowing Base Assets” means, as of any given
date, those assets contributing to the Borrowing Base Asset Value after the
reductions made pursuant to subclause (b) of the definition thereof.

 

“Borrowing Base Certificate” shall have the
meaning given to such term in Section 7.1(k).

 

“Borrowing Base Percentage” means (a) prior to
the date on which the obligations under the Revolving Credit Documents are
Fully Satisfied, fifty percent (50.0%); and (b) following such date, forty-five
percent (45.0%).

 

“Business Day” means a day other than a
Saturday, Sunday or other day on which commercial banks in Charlotte, North
Carolina or New York, New York are authorized or required by law to close.

 

“Businesses” means, at any time, a collective
reference to the businesses operated by the Consolidated Parties at such time.

 

“Capitalized Lease Obligation”
means Indebtedness represented by obligations under a Capital Lease, and the
amount of such Indebtedness is the capitalized amount of such obligations
determined in accordance with GAAP.

 

“Capital Lease” means, as applied to any
Person, any lease of any Property (whether real, personal or mixed) by that
Person as lessee which, in accordance with GAAP, is required to be accounted
for as a capital lease on the balance sheet of that Person.

 

“Capital Stock” means (i) in the case of a
corporation, capital stock, (ii) in the case of an association or business
entity, any and all shares, interests, participations, rights or other
equivalents (however designated) of capital stock, (iii) in the case of a
partnership, partnership units or interests (whether general or limited),
(iv) in the case of a limited liability company, membership interests and
(v) any other interest or participation that confers on a Person the right
to receive a share of the profits and losses of, or distributions of assets of,
the issuing Person.

 

“Cash Equivalents” means, as at any date,
(a) securities issued or directly and fully guaranteed or insured by the
United States or any agency or instrumentality thereof (provided that the full
faith and credit of the United States is pledged in support thereof) having
maturities of not more than twelve months from the date of acquisition,
(b) Dollar denominated time deposits and certificates of deposit of
(i) any Lender, (ii) any domestic commercial bank of recognized
standing having capital and surplus in excess of $500,000,000 or (iii) any
bank whose short-term commercial paper rating from S&P is at least A-1 or
the equivalent thereof or from Moody’s is at least P-1 or the equivalent
thereof (any such bank being an “Approved Bank”), in each case with
maturities of not more than 270 days from the date of acquisition,
(c) commercial paper and variable or fixed rate notes issued by any
Approved Bank (or by the parent company thereof) or any variable rate notes
issued by, or guaranteed by, any domestic corporation rated A-1 (or the
equivalent thereof) or better by S&P or

 

4

 

P-1 (or the
equivalent thereof) or better by Moody’s and maturing within six months of the
date of acquisition, (d) repurchase agreements entered into by any Person
with a bank or trust company (including any of the Lenders) or recognized
securities dealer having capital and surplus in excess of $500,000,000 for
direct obligations issued by or fully guaranteed by the United States in which
such Person shall have a perfected first priority security interest (subject to
no other Liens) and having, on the date of purchase thereof, a fair market
value of at least 100% of the amount of the repurchase obligations and (e) Investments,
classified in accordance with GAAP as current assets, in money market
investment programs registered under the Investment Company Act of 1940, as
amended, which are administered by reputable financial institutions having
capital of at least $500,000,000 and the portfolios of which are limited to
Investments of the character described in the foregoing subdivisions (a)
through (d).

 

“Change in Management” means a change in the
identity of the Chief Executive Officer of the General Partner or the USRP REIT,
other than on account of the death or permanent disability of such Person.

 

“Change of Control” means any of the following
events: (a) the sale, lease, transfer or other disposition, in one or a
series of related transactions, of all or substantially all of the assets of
any of the Borrowers and such Borrower’s Subsidiaries taken as a whole to any “person” or “group”  (within
the meaning of Sections 13(d) and 14(d)(2) of the Securities Exchange
Act), or (b) the USRP REIT shall fail to own and control (whether directly
or indirectly) 80% of the outstanding Capital Stock of any Borrower.  As used herein, “beneficial ownership” shall
have the meaning provided in Rule 13d-3 of the Securities and Exchange
Commission under the Securities Exchange Act.

 

“Closing Date” means the date hereof.

 

“Code” means the Internal Revenue Code of 1986,
as amended, and any successor statute thereto, as interpreted by the rules and
regulations issued thereunder, in each case as in effect from time to
time.  References to sections of the
Code shall be construed also to refer to any successor sections.

 

“Collateral Agent” means Bank of America, N.A.,
in such capacity under the Intercreditor Agreement and the Security Documents,
or its successors and assigns.

 

“Commitment” means as to each Lender, its
obligation to make its Term Loan to the Borrower pursuant to Section 2.1,
in an aggregate principal amount at any one time outstanding not to exceed the
amount set forth opposite such Lender’s name on Schedule 1.1(a) or in
the Assignment and Assumption pursuant to which such Lender becomes a party
hereto, as applicable, as such amount may be adjusted from time to time in
accordance with this Credit Agreement.

 

“Concept” means any
distinctive brand, trade name or system for establishing and operating
restaurants and/or convenience stores which is the subject of a license or
franchise from a Person.  Not in
limitation of the foregoing, and by way of example only, such systems would
include “Burger King,” “Pizza Hut,” “Denny’s,” and “Fina.”

 

“Consolidated Capital Expenditures” means, as
of any date, for the four fiscal quarter period most recently ending on or
prior to such date, the sum of all capital expenditures of the Consolidated
Parties on a consolidated basis, as determined in accordance with GAAP.

 

“Consolidated Fixed Charges” means, as of any
date, for the four fiscal quarter period most recently ending on or prior to
such date, the sum of (a) all scheduled payments of principal on Funded
Indebtedness of the Consolidated Parties on a consolidated basis (including,
without limitation, (i) the implied principal component of payments due on
Capital Leases and Synthetic Leases, (ii) all dividends paid on the preferred
Capital Stock of any Consolidated Party and (iii) an amount, not less than zero
(0), equal to  (A) payments made in
connection with any ground leases, but excluding voluntary prepayments or
mandatory prepayments required pursuant to Section 3.3 and any scheduled
balloon, bullet or similar principal payment repaying the related underlying
principal Indebtedness in full), as determined in accordance with GAAP, less
(B) the rental income received by the Consolidated Parties in connection with
such ground leased properties in connection with operating leases under which a
Consolidated Party is the

 

5

 

lessor, plus (b)
without duplication, the sum of (i) all scheduled payments of principal on
Funded Indebtedness of each Unconsolidated Affiliate multiplied by the
respective Unconsolidated Affiliate Interest of each such entity, (ii) all
dividends paid on the preferred Capital Stock of any Unconsolidated Affiliate
multiplied by the respective Unconsolidated Affiliate Interest of each such
entity; and (iii) an amount, not less than zero (0), equal to (A) (1) payments
made by any Unconsolidated Affiliate in connection with any ground leases, less
(2) the rental income received by any Unconsolidated Affiliate in connection
with such ground leased properties in connection with operating leases under
which an Unconsolidated Affiliate is the lessor, multiplied by (B) the
respective Unconsolidated Affiliate Interest of each such entity; provided,
that in each case, all of the above amounts not otherwise adjusted to account
for Minority Interests shall be adjusted to deduct therefrom the pro rata share
of such amounts allocable to the Minority Interests, plus (c) Consolidated
Interest Expense.

 

“Consolidated Interest Expense” means, as of
any date, for the four fiscal quarter period most recently ending on or prior
to such date, the sum of (i) interest expense in connection with Funded
Indebtedness (including the amortization of debt discount and premium, the
interest component under Capital Leases, the implied interest component under
Synthetic Leases and obligation payments under the any hedging agreements or
similar arrangements entered into by any Consolidated Party) of the
Consolidated Parties on a consolidated basis, as determined in accordance with
GAAP, plus (ii) without duplication, interest expense in connection with Funded
Indebtedness (including the amortization of debt discount and premium, the
interest component under Capital Leases and the implied interest component
under Synthetic Leases) of each Unconsolidated Affiliate multiplied by the
respective Unconsolidated Affiliate Interest of each such entity; provided,
that in each case, all of the above amounts not otherwise adjusted to account
for Minority Interests shall be adjusted to deduct therefrom the pro rata share
of such amounts allocable to the Minority Interests.

 

“Consolidated Net Income” means, as of any
date, for the four fiscal quarter period most recently ending on or prior to
such date, (i) net income (excluding extraordinary items) of the Consolidated
Parties on a consolidated basis after interest expense, income, value added and
similar taxes and depreciation and amortization, all as determined in
accordance with GAAP, plus (ii) without duplication, an amount equal to the
aggregate of net income (excluding extraordinary items) after interest expense,
income, value added and similar taxes and depreciation and amortization, as
determined in accordance with GAAP, of each Unconsolidated Affiliate multiplied
by the respective Unconsolidated Affiliate Interest of each such entity;
provided, that in each case, all of the above amounts not otherwise adjusted to
account for Minority Interests shall be adjusted to deduct therefrom the pro
rata share of such amounts allocable to the Minority Interests.

 

“Consolidated Parties” means a collective
reference to the USRP REIT, the General Partner, the Borrower and each of their
Subsidiaries, and “Consolidated Party” means any one of them.

 

“Consolidated Total EBITDA” means, as of any
date, for the four fiscal quarter period most recently ending on or prior to
such date, the sum of (a) Consolidated Net Income, plus (b) the sum of the following (but only to the extent taken into
account in determining Consolidated Net Income for such period):  (i) depreciation and amortization expense
for such period; plus (ii) interest expense for such period; plus
(iii) income tax expense in respect of such period; minus (or plus,
as appropriate) (iv) extraordinary gains (losses) and gains (losses) from sales
of assets for such period (provided, for purposes of clarification, that
such gains shall be subtracted from the overall amount calculated pursuant to
this clause (ii) and such losses shall be added to such amount); plus (or minus, as appropriate)
(v) extraordinary gains (or losses) (provided, for purposes of
clarification, that such gains shall be subtracted from the overall amount
calculated pursuant to this clause (b) and such losses shall be added to such
amount), plus (or minus, as appropriate) (vi) all
straight line rent leveling adjustments (reported in the consolidated financial
statements of such Person for purposes of GAAP); plus (or minus,
as appropriate) (vii) equity in net earnings (or net loss) of unconsolidated
Affiliates of such Person (if any); plus (viii) amounts incurred by such
Person for such period as “impairment of long lived assets,” in each
case without duplication and as determined in accordance with GAAP; provided,
that, (A) each of the above calculations shall include, without duplication,
any amounts attributable to any interests held by any Consolidated Party in any
Unconsolidated Affiliate and (B) all amounts included in the above calculations
(and not otherwise

 

6

 

adjusted to
account for Minority Interests) shall be adjusted to deduct therefrom the pro
rata share of such amounts allocable to Minority Interests.

 

“Contingent Obligation”
means, with respect to any Person, any obligation of such Person to guarantee
or intended to guarantee any Indebtedness, leases, dividends or other
obligations (“primary obligations”) of any other Person (the “primary obligor”)
in any manner, whether directly or indirectly (exclusive of any non-material
contractual indemnities and non-material guarantees of non-monetary obligations
which have not yet been called on or quantified), including, without
limitation, (a) the direct or indirect guaranty, endorsement (other than for
collection or deposit in the ordinary course of business), co-making,
discounting with recourse or sale with recourse by such Person of the
obligation of a primary obligor, (b) the obligation to make take-or-pay or
similar payments, if required, regardless of nonperformance by any other party
or parties to an agreement, (c) any obligation of such Person, whether or not
contingent, (i) to purchase any such primary obligation or any property
constituting direct or indirect security therefor, (ii) to advance or supply
funds (A) for the purchase or payment of any such primary obligation or (B) to
maintain working capital, equity capital, net worth or other balance sheet
condition or any income statement condition of the primary obligor or otherwise
to maintain the solvency of the primary obligor, (iii) to purchase, lease or
otherwise acquire property, assets, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the ability of
the primary obligor to make payment of such primary obligation or (iv)
otherwise to assure or hold harmless the holder of such primary obligation
against loss in respect thereof, (d) any residual obligation or liability of
such Person under any Synthetic Lease or any other off-balance sheet financing,
or (e) any obligation of such Person in connection with any derivative
transaction, hedging transaction (including, without limitation, any Hedging
Agreements), takeout commitment or forward equity commitment.  The amount of any Contingent Obligation
shall be deemed to be an amount equal to the stated or determinable amount of
the primary obligation in respect of which such Contingent Obligation is made
(or, if less, the maximum amount of such primary obligation for which such
Person may be liable pursuant to the terms of the agreement, instrument or
other document evidencing such Contingent Obligation) or, if not stated or
determinable, the maximum reasonably anticipated liability in respect thereof
(assuming such Person is required to perform thereunder), as determined by such
Person in good faith.  Contingent
Obligations shall not include the following obligations or liabilities of the
General Partner, the Borrower or any other Subsidiaries thereof (including any
Special Purpose Entity and any Bankruptcy Remote Borrowing Entity) to the
extent incurred in connection with a Securitization Asset Sale: reasonable and
customary obligations of the General Partner, the Borrower or any other
Subsidiaries thereof with respect to (i) the servicing of any assets which are
the subject of such Securitization Asset Sale, (ii) administrative and
ministerial matters relating to any applicable Special Purpose Entity, (iii)
maintenance of the corporate separateness of any such Special Purpose Entity
from that of the General Partner and its other Subsidiaries and (iv) the
guaranty of payment of fees of any Person acting as a trustee in connection
with such Securitization Asset Sale and indemnification obligations owing to
any such Person.  In addition, the
ownership of a Subordinated Interest shall not be deemed to give rise to any
Contingent Obligation on the part of the owner thereof.  Further, Contingent Obligations shall not
include liabilities of the General Partner, Borrower or any Consolidated Party
(i) which result solely from the General Partner or such Consolidated Party
being a general partner of a Special Purpose Entity that is a limited
partnership and is not a Consolidated Party, and (ii) which liabilities are
attributable to customary and reasonable non-recourse exceptions,
representations and warranties involved with securitization transactions and
not related to the creditworthiness of the obligors involved in such
transactions (including, without limitation, exceptions for fraud,
environmental indemnities and misapplication of proceeds).

 

“Continue”, “Continuation” and “Continued”
shall refer to the continuation pursuant to Section 3.2(a) hereof of a
Eurodollar Loan from one Interest Period to the next Interest Period.

 

“Convert”, “Conversion” and “Converted”
shall refer to a conversion pursuant to Section 3.2(b) or
Sections 3.7 through 3.12, inclusive, of a Base Rate Loan into a
Eurodollar Loan.

 

“Credit Documents” means a collective reference
to this Credit Agreement, the Notes, each Joinder Agreement, and the Security Documents (in each case
as the same may be amended, modified,

 

7

 

restated,
supplemented, extended, renewed or replaced from time to time), and “Credit
Document” means any one of them.

 

“Credit Facility” shall have the meaning
assigned to such term in the recitals hereto.

 

“Credit Parties” means a collective reference
to the Borrower, the General Partner and the other Guarantors, and “Credit
Party” means any one of them.

 

“Credit Party Obligations” means, without
duplication, all of the obligations of the Credit Parties to the Lenders and
the Agent, whenever arising, under this Credit Agreement, the Notes or any of
the other Credit Documents (including, but not limited to, any interest
accruing after the occurrence of a Bankruptcy Event with respect to any Credit
Party, regardless of whether such interest is an allowed claim under the
Bankruptcy Code) and (ii) all liabilities and obligations, whenever
arising, owing from any Credit Party to any Lender, or any Affiliate of a
Lender, arising under any Hedging Agreement.

 

“Creditor Group” means a collective reference
to the Collateral Agent, the Lender Parties hereunder and the “Lender Parties”
as such term is defined in the Revolving Credit Agreement.

 

“Debt Service” means, for any given calculation
period and assuming an opening principal balance equal to the amount of the
principal balance outstanding under this Credit Agreement and the Revolving
Credit Agreement at the beginning of such period, an amount of debt service
equal to the greater of (a) the amount of principal and interest payments that
would be paid on such principal balance during such period (assuming level
monthly payments of principal and interest) at an annual interest rate equal to
the yield, as of the last day of the calculation period, on the seven year U.S.
Treasury Bond plus 2.50% and with a twenty-five (25) year
amortization schedule and (b) the amount of principal and interest payments
resulting from the application of a loan constant equal to 9.33% to such
opening principal balance (assuming level monthly payments of principal and
interest over a twenty-five (25) year amortization schedule); provided,
however, that to the extent the amount of actual debt service payments due from
the Borrower during the applicable calculation period exceed the amount
calculated in accordance with the above provisions, “Debt Service” shall,
notwithstanding the above, equal the amount of such actual debt service
payments due during the applicable period.

 

“Debt Service Coverage Ratio” means, for any
given date of calculation, the ratio of (i) EBITDA generated in connection with
the Borrowing Base Assets during the previous twelve (12) month period for
which the Borrower has delivered officer’s certificates pursuant to the terms
of Section 7.1(c) of this Agreement to (ii) Debt Service for the same
twelve (12) month period. 
Notwithstanding the foregoing, to the extent any Borrowing Base Asset(s)
have been held by the Borrower for less than twelve months as of the applicable
calculation date, EBITDA with respect to such asset(s) shall be calculated by
annualizing EBITDA amounts attributable to such asset(s) as set forth in the
financial statements which the Borrower has, as of that calculation date,
delivered to the Agent, except to the extent the Borrower has failed to deliver
financial statements accounting for such Borrowing Base Assets pursuant to and
in accordance with this Agreement, in which case the EBITDA for such Borrowing
Base Assets shall, for purposes of this definition, equal zero (0).

 

“Default” means any event, act or condition
which with notice or lapse of time, or both, would constitute an Event of
Default.

 

“Defaulting Lender” means, at any time, any
Lender that, as determined by the Agent, (a) has failed to make a Loan or
purchase a Participation Interest required pursuant to the term of this Credit
Agreement within one Business Day of when due, (b) other than as set forth
in (a) above, has failed to pay to the Agent or any Lender an amount owed by
such Lender pursuant to the terms of this Credit Agreement within one Business
Day of when due, unless such amount is subject to a good faith dispute or
(c) has been deemed insolvent or has become subject to a bankruptcy or
insolvency proceeding or with respect to which (or with respect to any of the
assets of which) a receiver, trustee or similar official has been appointed.

 

“Delinquency Report” means a report prepared by
the Borrower setting forth in itemized detail, as of a given date, all
delinquencies with respect to Tenant payments (whether or not such
delinquencies result in the applicable asset being characterized as an Excluded
Asset for purposes hereof) and all other matters

 

8

 

causing any asset
owned by any of the Consolidated Parties to constitute an Excluded Asset.  Such report shall identify the respective
owners of the assets named therein and shall identify which, if any, of the
assets named therein constitute Borrowing Base Assets as of the date of such
report.

 

“Determination Decision”
shall have the meaning given to such term in Section 3.22.

 

“Determination Request”
shall have the meaning given to such term in Section 3.22.

 

“Development Activities”
means activities relating directly or indirectly to the development of
build-to-suit Real Property assets that are 100% pre-leased.

 

“Dollars” and “$” means dollars in
lawful currency of the United States.

 

“Domestic Subsidiary” means any direct or
indirect Subsidiary of the Borrower which is incorporated or organized under
the laws of any State of the United States or the District of Columbia.

 

“EBITDA” means, (a) for any Person over any period, (i) net earnings (loss) of such
Person for such period plus (ii) the sum of the following (but only to the
extent taken into account in determining net earnings (loss) for such period):
(A) depreciation and amortization expense for such period; plus (B)
interest expense for such period; plus (C) income tax expense in respect
of such period; minus (or plus, as appropriate) (D) extraordinary
gains (losses) and gains (losses) from sales of assets for such period (provided,
for purposes of clarification, that such gains shall be subtracted from the
overall amount calculated pursuant to this clause (ii) and such losses shall be
added to such amount); plus (or minus,
as appropriate) (E) extraordinary gains (or losses) (provided, for
purposes of clarification, that such gains shall be subtracted from the overall
amount calculated pursuant to this clause (ii) and such losses shall be added
to such amount), plus (or minus, as appropriate) (F) all
straight line rent leveling adjustments (reported in the consolidated financial
statements of such Person for purposes of GAAP); plus (or minus,
as appropriate) (G) equity in net earnings (or net loss) of unconsolidated
Affiliates of such Person (if any); plus (H) amounts incurred by such
Person for such period as “impairment of long lived assets,” in each
case without duplication and as determined in accordance with GAAP; and (b) for any Real Property for any
period, the net income (excluding extraordinary items) of such Real Property
for such period (which, for leased Real Properties, shall be the rental income
for such Real Properties during such period) before (without duplication)
interest expense applicable to such Real Property, income taxes applicable to
such Real Property and depreciation and amortization applicable to such Real
Property, all as determined in accordance with GAAP.

 

“Eligible Assignee” means (a) a Lender; (b) an
Affiliate of a Lender; (c) an Approved Fund; and (d) any other Person (other
than a natural person) approved by the Agent, in its discretion; provided
that notwithstanding the foregoing, “Eligible Assignee” shall not include the
Borrower, any Credit Party or any of the Borrower’s or any Credit Party’s
Affiliates or Subsidiaries.

 

“Environmental Laws” means any and all lawful
and applicable Federal, state, local and foreign statutes, laws (including,
without limitation, the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, the Resource Conservation and Recovery Act of 1976, the Toxic
Substances Control Act, the Water Pollution Control Act, the Clean Air Act and
the Hazardous Materials Transportation Act), regulations, ordinances, rules,
judgments, orders, decrees, permits, concessions, grants, franchises, licenses,
agreements or other governmental restrictions relating to the environment or to
emissions, discharges, releases or threatened releases of pollutants,
contaminants, chemicals, or industrial, toxic or hazardous substances or wastes
into the environment including, without limitation, ambient air, surface water,
ground water, or land, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport, or handling of
pollutants, contaminants, chemicals, or industrial, toxic or hazardous
substances or wastes.

 

“Equity Issuance” means any issuance by any
Consolidated Party to any Person of (a) shares of its Capital Stock,
(b) any shares of its Capital Stock pursuant to the exercise of options or
warrants, (c) any shares of its Capital Stock pursuant to the conversion
of any debt securities to equity or (d) any options or warrants

 

9

 

relating to its
Capital Stock (other than employee stock options currently in place).  The term “Equity Issuance” shall not include
any Asset Disposition.

 

“ERISA” means the Employee Retirement Income
Security Act of 1974, as amended, and any successor statute thereto, as
interpreted by the rules and regulations thereunder, all as the same may be in
effect from time to time.  References to
sections of ERISA shall be construed also to refer to any successor sections.

 

“ERISA Affiliate” means an entity which is
under common control with any Consolidated Party within the meaning of
Section 4001(a)(14) of ERISA, or is a member of a group which includes any
Consolidated Party and which is treated as a single employer under
Sections 414(b) or (c) of the Code.

 

“ERISA Event” means (i) with respect to
any Plan, the occurrence of a Reportable Event or the substantial cessation of
operations (within the meaning of Section 4062(e) of ERISA); (ii) the
withdrawal by any Consolidated Party or any ERISA Affiliate from a Multiple
Employer Plan during a plan year in which it was a substantial employer (as
such term is defined in Section 4001(a)(2) of ERISA), or the termination
of a Multiple Employer Plan; (iii) the distribution of a notice of intent
to terminate or the actual termination of a Plan pursuant to
Section 4041(a)(2) or 4041A of ERISA; (iv) the institution of
proceedings to terminate or the actual termination of a Plan by the PBGC under
Section 4042 of ERISA; (v) any event or condition which might
constitute grounds under Section 4042 of ERISA for the termination of, or
the appointment of a trustee to administer, any Plan; (vi) the complete or
partial withdrawal of any Consolidated Party or any ERISA Affiliate from a
Multiemployer Plan; (vii) the conditions for imposition of a lien under
Section 302(f) of ERISA exist with respect to any Plan; or (viii) the
adoption of an amendment to any Plan requiring the provision of security to
such Plan pursuant to Section 307 of ERISA.

 

“Eurodollar Loan” means any portion of the
Loans that bears interest at a rate based upon the Eurodollar Rate.

 

“Eurodollar Rate” means, for any Eurodollar
Loan for any Interest Period therefor, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) determined by the Agent to be equal to
the quotient obtained by dividing (a) the Interbank Offered Rate for such
Eurodollar Loan for such Interest Period by (b) 1 minus the Eurodollar
Reserve Requirement for such Eurodollar Loan for such Interest Period.

 

“Eurodollar Reserve Requirement” means, at any
time, the maximum rate at which reserves (including, without limitation, any
marginal, special, supplemental, or emergency reserves) are required to be
maintained under regulations issued from time to time by the Board of Governors
of the Federal Reserve System (or any successor) by member banks of the Federal
Reserve System against “Eurocurrency liabilities” (as such term is used in
Regulation D).  Without limiting
the effect of the foregoing, the Eurodollar Reserve Requirement shall reflect
any other reserves required to be maintained by such member banks with respect
to (i) any category of liabilities which includes deposits by reference to
which the Adjusted Eurodollar Rate is to be determined, or (ii) any
category of extensions of credit or other assets which include Eurodollar
Loans.  The Adjusted Eurodollar Rate
shall be adjusted automatically on and as of the effective date of any change
in the Eurodollar Reserve Requirement.

 

“Event of Default” shall have the meaning
assigned to such term in Section 9.1.

 

“Excluded
Assets” means, as of any date, with respect to each of the General SPE,
S&C, JV1 and each of its Wholly Owned Subsidiaries and HCI and each of its
Wholly Owned Subsidiaries (a) all assets of such Person which are either a
lease by a Person, as lessor of a parcel of Real Property, or a promissory note
held by such Person which is secured by a mortgage instrument, in either case
where (i) any required rental payment, principal or interest payment, or other
payment due under such lease or promissory note, as the case may be, is more
than sixty (60) days past due, except, with respect to payments due under
a lease, to the extent (A) the aggregate amount of such past due payments with
respect to such lease is less than $2500 and (B) the aggregate amount of such
past due payments does not exceed $30,000; (ii) the Tenant under such lease or
the maker of such promissory note, as the case may be, is the subject of a
Bankruptcy Event (except to the extent that
(A) such Person has been subject to a proceeding under Chapter 11 of the
Federal Bankruptcy Code, (B) the applicable bankruptcy court has approved and
confirmed such Person’s plan for reorganization, (C) all

 

10

 

statutory appeal periods
with respect to such proposed plan have been exhausted or expired without
objection, (D) the approved plan requires such Person to continue to perform
its obligations with respect to the applicable lease/franchise agreement and
(E) such Person is performing its obligations under such approved plan and
under the applicable lease/franchise agreement); (iii) condemnation proceedings have been instituted or condemnation has
occurred with respect to a material portion of the applicable parcel of Real
Property; or (iv) the subject Real Property has been vacant for more than
sixty (60) days and such vacancy is not the result of an on-schedule
moving-in process or scheduled renovations, and (b) all Real Property assets of
the General SPE, S&C, JV1 and its Wholly Owned Subsidiaries and HCI and its Wholly Owned Subsidiaries which are, as of such date, not subject to a
lease agreement under which a Consolidated Party is the lessor or are otherwise
vacant (except as noted above in subclause (a)).

 

“Executive Officer” of any Person means any of
the chief executive officer, chief operating officer, president, vice president,
chief financial officer or treasurer of such Person.

 

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

 

“Fee Letter” means that certain Fee Letter
entered into by and among Borrower, BOA and BAS and dated as of or prior to the
date hereof.

 

“Fees” means all fees payable pursuant to
Section 3.5 (if any).

 

“FFO” means, for a given period, (a)
Consolidated Net Income (before Unconsolidated Affiliate Interests and before
extraordinary and non recurring items) for such period minus (or plus)
(b) gains (or losses) from debt restructuring and sales of property during such
period, plus (c) depreciation and amortization of real and personal
property assets for such period, and after adjustments for unconsolidated partnerships
and joint ventures, plus (d) impairment charges reported by such Persons
for such period.  In determining whether
an amount distributed in a given fiscal quarter is applicable to the FFO of
such fiscal quarter or a prior fiscal quarter, the Borrower shall, in all
cases, assume that amounts distributed are distributed with respect to FFO
earned in the most recent fiscal quarter for which there exists undistributed
FFO.

 

“FFO Distribution Allowance” means, for each
fiscal quarter of the Consolidated Parties, an amount equal to 95% of FFO for
such quarter, plus, to the extent not otherwise distributed prior to
commencement of the quarter for which such calculation is being performed, 95%
of FFO for the immediately preceding three fiscal quarters.

 

“Financial Covenants” means a collective
reference to the covenants contained in Sections 7.11, 8.1(c) and (h), 8.2(b)
and (c), 8.5(a) and (b), 8.6(d), (e), (h), (i), (j), (k), (l) and (m) and 8.16
hereof.

 

“Fixed Charge Coverage Ratio” means, as of the
end of any fiscal quarter of the Consolidated Parties, for the four fiscal
quarter period most recently ending on or prior to such date with respect to
the Consolidated Parties on a consolidated basis, the ratio of
(a) Consolidated Total EBITDA for such period to (b) Consolidated
Fixed Charges for such period.

 

“Foreign Lender” shall have the meaning given
to such term in Section 3.11(d) hereof.

 

“Foreign Subsidiary” means any direct or
indirect Subsidiary of the Borrower which is not a Domestic Subsidiary.

 

11

 

“Fully Satisfied” means, with respect to the
Credit Party Obligations as of any date, that, as of such date, (a) all
principal of and interest accrued to such date which constitute Credit Party
Obligations shall have been paid in full in cash, and (b) all fees,
expenses and other amounts then due and payable which constitute Credit Party
Obligations shall have been paid in cash.

 

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

 

“Funded Indebtedness” means, with respect to
any Person, without duplication, (i) all Indebtedness of such Person other
than Indebtedness of the types referred to in clauses (e), (f), (g), (i),
(n) and (p) of the definition of “Indebtedness” set forth in this
Section 1.1, (ii) all Funded Indebtedness of others of the type
referred to in clause (i) above secured by (or for which the holder of
such Funded Indebtedness has an existing right, contingent or otherwise, to be
secured by) any Lien on, or payable out of the proceeds of production from,
Property owned or acquired by such Person, whether or not the obligations
secured thereby have been assumed (or, if less, the aggregate net book value of
all Property securing such Funded Indebtedness of others), (iii) all
Guaranty Obligations of such Person with respect to Funded Indebtedness of the
type referred to in clause (i) above of another Person and
(iv) Funded Indebtedness of the type referred to in
clause (i) above of any partnership or unincorporated joint venture
in which such Person is a general partner or a joint venturer to the extent
such Funded Indebtedness is recourse to such Person.

 

“GAAP” means generally accepted accounting
principles in the United States applied on a consistent basis except as
specifically set forth in the definitions contained herein and subject to the
terms of Section 1.3.

 

“General Partner” shall have the meaning given
to such term in the heading hereof.

 

“General SPE” shall have the meaning given to
such term in the heading hereof.

 

“Governmental Authority” means any Federal,
state, local or foreign court or governmental agency, authority,
instrumentality or regulatory body.

 

“Ground Lease Interests” means Real Property
assets with respect to which a Consolidated Party is the ground lessee.

 

“Guarantors” means a collective reference to
the USRP REIT, the General Partner and each of the Subsidiary Guarantors,
together with each of their successors and permitted assigns, and “Guarantor
“ means any one of them.

 

“Guaranty Obligations” means, with respect to
any Person, without duplication, any obligations of such Person (other than endorsements
in the ordinary course of business of negotiable instruments for deposit or
collection) guaranteeing or intended to guarantee any Indebtedness of any other
Person in any manner, whether direct or indirect, and including without
limitation any obligation, whether or not contingent, (i) to purchase any
such Indebtedness or any Property constituting security therefor, (ii) to
advance or provide funds or other support for the payment or purchase of any
such Indebtedness or to maintain working capital, solvency or other balance
sheet condition of such other Person (including without limitation keep well
agreements, maintenance agreements, comfort letters or similar agreements or
arrangements) for the benefit of any holder of Indebtedness of such other
Person, (iii) to lease or purchase Property, securities or services
primarily for the purpose of assuring the holder of such Indebtedness, or
(iv) to otherwise assure or hold harmless the holder of such Indebtedness
against loss in respect thereof.  The amount
of any Guaranty Obligation hereunder shall (subject to any limitations set
forth therein) be deemed to be an amount equal to the outstanding principal
amount (or maximum principal amount, if larger) of the Indebtedness in respect
of which such Guaranty Obligation is made.

 

“Hawaii Loan Documents” means that certain Loan
Agreement to be entered into by and among USRP (Bob), LLC, USRP (Hawaii), LLC
and Fuel Supply, Inc. (as the borrowers thereunder) and First Hawaiian Bank (as
the lender) and each of the “Loan Documents” as defined therein; provided, that
such

 

12

 

documents shall
substantially similar to those delivered to the Agent prior to the Closing Date
and be otherwise in form and substance acceptable to the Agent in its
discretion.

 

“HCI” has
the meaning given to such term in the Preamble of this Credit Agreement.

 

“Hedging Agreements” means (a) any and all
rate swap transactions, basis swaps, credit derivative transactions, forward
rate transactions, commodity swaps, commodity options, forward commodity
contracts, equity or equity index swaps or options, bond or bond price or bond
index swaps or options or forward bond or forward bond price or forward bond
index transactions, interest rate options, forward foreign exchange
transactions, cap transactions, floor transactions, collar transactions,
currency swap transactions, cross-currency rate swap transactions, currency
options, spot contracts, or any other similar transactions or any combination
of any of the foregoing (including any options to enter into any of the
foregoing), whether or not any such transaction is governed by or subject to
any master agreement  (including,
without limitation, any BOA Derivative Instruments), and (b) any and all
transactions of any kind, and the related confirmations, which are subject to
the terms and conditions of, or governed by, any form of master agreement
published by the International Swaps and Derivatives Association, Inc., any
International Foreign Exchange Master Agreement, or any other master agreement
(any such master agreement, together with any related schedules, a “Master
Agreement”), including any such obligations or liabilities under any Master
Agreement, in each case (with respect to both clause (a) and (b) of this
definition, entered into between any Consolidated Party and any Lender.

 

“ICA Joinder Agreement” shall have the meaning
given to such term in the Intercreditor Agreement.

 

“Indebtedness” means, with respect to any
Person, without duplication, (a) all obligations of such Person for
borrowed money, (b) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments, or upon which interest payments are
customarily made, (c) all obligations of such Person under conditional
sale or other title retention agreements relating to Property purchased by such
Person (other than customary reservations or retentions of title under
agreements with suppliers entered into in the ordinary course of business),
(d) all obligations of such Person issued or assumed as the deferred
purchase price of Property or services purchased by such Person (other than
trade debt incurred in the ordinary course of business and due within six
months of the incurrence thereof) which would appear as liabilities on a
balance sheet of such Person, (e) all obligations of such Person under
take-or-pay or similar arrangements or under commodities agreements,
(f) all Indebtedness of others secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be secured by)
any Lien on, or payable out of the proceeds of production from, Property owned
or acquired by such Person, whether or not the obligations secured thereby have
been assumed, (g) all Guaranty Obligations of such Person with respect to
Indebtedness of another Person, (h) the implied principal component of all
obligations of such Person under Capital Leases, including all Capitalized
Lease Obligations of such Person, (i) all obligations of such Person under
hedging agreements and other similar arrangements, (j) the maximum amount
of all performance and standby letters of credit issued or bankers’ acceptances
facilities created for the account of such Person and, without duplication, all
drafts drawn thereunder (to the extent unreimbursed), (k) all preferred
Capital Stock issued by such Person and which by the terms thereof could be (at
the request of the holders thereof or otherwise) subject to mandatory sinking
fund payments, redemption or other acceleration (other than as a result of a
Change of Control or an Asset Disposition that does not in fact result in a
redemption of such preferred Capital Stock) at any time or which are otherwise
classified as liabilities or indebtedness under GAAP, (l) the principal
portion of all obligations of such Person under Synthetic Leases, (m) all
obligations of such Person to repurchase any securities issued by such Person
at any time prior to the Maturity Date which repurchase obligations are related
to the issuance thereof, including, without limitation, obligations commonly
known as residual equity appreciation potential shares, (n) the
Indebtedness of any partnership or unincorporated joint venture in which such
Person is a general partner or a joint venturer to the extent such Indebtedness
is recourse to such Person, (o) the aggregate amount of uncollected
accounts receivable of such Person subject at such time to a sale of
receivables (or similar transaction) to the extent such transaction is effected
with recourse to such Person (whether or not such transaction would be
reflected on the balance sheet of such Person in accordance with GAAP) and (p)
all Contingent Obligations of such Person. 
For purposes of clarification, the ordinary and customary rent
obligations of a Person pursuant to the terms of a real property lease which is
not entered into as a capital or financing lease shall not be included in the
calculation of “Indebtedness” hereunder.

 

13

 

“Indemnified Party” shall have the meaning
assigned to such term in Section 11.5(b).

 

“Interbank Offered Rate” means, for any Eurodollar Loan for any Interest
Period therefor, the rate per annum (rounded upwards, if necessary, to the
nearest 1/100 of 1%) appearing on Telerate Page 3750 (or any successor
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. If for any reason such rate is not available, the term
“LIBOR” shall mean, for any Eurodollar Loan for any Interest Period therefor,
the rate per annum (‘rounded upwards, if necessary, to the nearest 1/100 of 1%)
appearing on 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 Reuters Screen LIBO Page, the applicable rate shall be the
arithmetic mean of all such rates.

 

“Intercreditor Agreement”
means that certain Intercreditor Agreement dated as of the date hereof and
entered into by and among the Collateral Agent, the Agent and the “Agent” under
the Revolving Credit Agreement with respect to the priority of payments made by
Borrower hereunder and under the Revolving Credit Agreement and the allocation
of proceeds derived from the collateral under the Security Documents, as the
same may be amended, restated, supplemented or otherwise modified from time to
time in accordance with its terms.

 

“Interest Payment Date” means (a) as to
Base Rate Loans, (i) the 20th day of each calendar month, (ii) the
date of repayment of principal of such Loan and (iii) the Maturity Date, and
(b) as to Eurodollar Loans, (i) the last day of each applicable Interest
Period, (ii) the date of repayment of principal of such Loan, (iii) the
Maturity Date, and (iv) where the applicable Interest Period for a Eurodollar
Loan is greater than one month, the dates occurring each calendar month
following the first day of the Interest Period.

 

“Interest Period” means, as to Eurodollar
Loans, a period of one, two, three, six or twelve months duration (to the
extent available from each of the Lenders), as the Borrower may elect,
commencing, in each case, on the date of the borrowing (including continuations
and conversions thereof); provided, however, (a) if any
Interest Period would end on a day which is not a Business Day, such Interest
Period shall be extended to the next succeeding Business Day (except that where
the next succeeding Business Day falls in the next succeeding calendar month,
then on the next preceding Business Day), (b) no Interest Period shall
extend beyond the Maturity Date and (c) where an Interest Period begins on
a day for which there is no numerically corresponding day in the calendar month
in which the Interest Period is to end, such Interest Period shall end on the
last Business Day of such calendar month.

 

“Investment” in any Person means (a) the
acquisition (whether for cash, property, services, assumption of Indebtedness,
securities or otherwise) of assets (other than equipment, inventory and
supplies in the ordinary course of business and other than any acquisition of
assets constituting a Consolidated Capital Expenditure), Capital Stock, bonds,
notes, debentures, partnership, joint ventures or other ownership interests or
other securities of such other Person, (b) any deposit with, or advance,
loan or other extension of credit to, such Person (other than deposits made in
connection with the purchase of equipment inventory and supplies in the
ordinary course of business) or (c) any other capital contribution to or
investment in such Person, including, without limitation, any Guaranty Obligations
(including any support for a letter of credit issued on behalf of such Person)
incurred for the benefit of such Person and any Asset Disposition to such
Person for consideration less than the fair market value of the Property
disposed in such transaction, but excluding any Restricted Payment to such
Person.  Investments which are capital
contributions or purchases of Capital Stock which have a right to participate
in the profits of the issuer thereof shall be valued at the amount actually
contributed or paid to purchase such Capital Stock as of the date of such
contribution or payment.  Investments
which are loans, advances, extensions of credit or Guaranty Obligations shall
be valued at the principal amount of such loan, advance or extension of credit
outstanding as of the date of determination or, as applicable, the principal
amount of the loan or advance outstanding as of the date of determination
actually guaranteed by such Guaranty Obligation.

 

14

 

“I/O Strip” means an
interest in a pool of promissory notes, mortgage loans, or other similar
financial assets, issued in connection with a Securitization Asset Sale or
otherwise, which entitles the holder to receive a portion of the interest paid
on, but not principal repaid in respect of, such financial assets.

 

“Joinder Agreement” means a Joinder Agreement
substantially in the form of Exhibit 7.12 hereto, executed and
delivered by a new Guarantor in accordance with the provisions of
Section 7.12.

 

“JV1” shall have the meaning given to such term
in the introductory paragraph hereof.

 

“JV1 Pledge Agreement” means that certain Pledge and Security Agreement entered into by JV1 as
of the date hereof in favor of the Collateral Agent and for the benefit of the
Lender Parties.

 

“Lender” means any of the Persons identified as
a “Lender” on the signature pages hereto, and any Person which may become a
Lender by way of assignment in accordance with the terms hereof, together with
their successors and permitted assigns.

 

“Lender Party” shall mean any of the Agent or
any Lender from time to time a party hereto; and “Lender Parties” means a
collective reference to each.

 

“Leverage Ratio” means, as of the end of any
fiscal quarter of the Consolidated Parties, the ratio of (a) Total
Liabilities to (b) Total Tangible Assets.

 

“Lien” means any mortgage, pledge,
hypothecation, assignment, deposit arrangement, security interest, encumbrance,
lien (statutory or otherwise), preference, priority or charge of any kind
(including any agreement to give any of the foregoing, any conditional sale or
other title retention agreement, any financing or similar statement or notice
filed under the Uniform Commercial Code as adopted and in effect in the
relevant jurisdiction or other similar recording or notice statute, and any
lease in the nature thereof); provided, that the term “Lien” shall not refer to
or include Negative Pledges.

 

“Loan” or “Loans” means the Term Loans
(or a portion of any Term Loans bearing interest at the Adjusted Base Rate or
the Adjusted Eurodollar Rate and referred to as a Base Rate Loan or a
Eurodollar Loan), individually or collectively, as appropriate.

 

“Material Adverse Effect” means a material
adverse effect on (i) the condition (financial or otherwise), operations,
business, assets, liabilities or prospects of the Consolidated Parties taken as
a whole, (ii) the ability of any Credit Party to perform any material
obligation under the Credit Documents or the Revolving Credit Documents to
which it is a party or (iii) the material rights and remedies of the Agent
and the Lenders under the Credit Documents; provided, that, for purposes of
Section 6.16 hereof only, “Material Adverse Effect” means any one of (i)
through (iii) above or (iv) a material adverse effect on the value of,
conditions on, operations on, business conducted on or prospects of any parcel
of Real Property or the rights and remedies of the Agent and the Lenders with
respect thereto.

 

“Materials of Environmental Concern” means any
gasoline or petroleum (including crude oil or any fraction thereof) or
petroleum products or any hazardous or toxic substances, materials or wastes,
defined or regulated as such in or under any Environmental Laws, including,
without limitation, asbestos, polychlorinated biphenyls and urea-formaldehyde
insulation.

 

“Maturity Date” shall mean the date occurring
sixty (60) calendar months following the date hereof.

 

“Maximum Loan Amount” means, as of any date of
determination, an amount equal to the sum of each of the Commitments of the
Lenders as of such date.

 

“Minority Interests” means, at any time,
interests in any assets or entities (and, as applicable, the cost thereof, Cash
and Cash Equivalents held in connection therewith, the income, revenues,
interest

 

15

 

expense, taxes,
depreciation and amortization attributable thereto) owned by entities that are
not Consolidated Parties.

 

“Moody’s” means Moody’s Investors Service,
Inc., or any successor or assignee of the business of such company in the
business of rating securities.

 

“Multiemployer Plan” means a Plan which is a
“multiemployer plan” as defined in Sections 3(37) or 4001(a)(3) of ERISA.

 

“Multiple Employer Plan” means a Plan (other
than a Multiemployer Plan) which any Consolidated Party or any ERISA Affiliate
and at least one employer other than the Consolidated Parties or any ERISA
Affiliate are contributing sponsors.

 

“Negative Pledge” means a provision of any agreement (other than this Credit Agreement,
any other Credit Document or any Revolving Credit Document) that prohibits the
creation of any Lien on any assets of a Person, whether presently owned or
hereafter acquired; 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
Credit Agreement.

 

“Net Cash Proceeds” means the aggregate
proceeds paid in cash or Cash Equivalents received by any Consolidated Party in
respect of any Asset Disposition or Equity Issuance (as applicable), net of
(a) direct costs (including, without limitation, legal, accounting and
investment banking fees, and sales commissions) (b) taxes paid or payable
as a result thereof and (c) in the case of any Asset Disposition, the
amount necessary to retire any Indebtedness secured by a Permitted Lien
(ranking senior to any Lien of the Agent) on the related Property; it being
understood that “Net Cash Proceeds” shall include, without limitation, any cash
or Cash Equivalents received upon the sale or other disposition of any non-cash
consideration received by any such Consolidated Party in any such Asset
Disposition or Equity Issuance.

 

“Note” or “Notes” means the Term Notes,
individually or collectively, as appropriate.

 

“Notice of Borrowing” means a written notice of
borrowing in substantially the form of Exhibit 2.1(b)(i), as
required by Section 2.1(b)(i), Section 2.3(b) or Section 2.4(b).

 

“Notice of Continuation” means a notice in the
form of Exhibit 3.2 to be delivered to the Agent pursuant to
Section 3.2(a) evidencing the Borrower’s request for the Continuation of a
Eurodollar Loan.

 

“Notice of Conversion”
means a notice in the form of Exhibit 3.2 to be delivered to the
Agent pursuant to Section 3.2(b) evidencing the Borrower’s request for the
Conversion of a Loan from one Type to another Type.

 

“Operating Lease” means, as applied to any
Person, any lease (including, without limitation, leases which may be
terminated by the lessee at any time) of any Property (whether real, personal
or mixed) which is not a Capital Lease other than any such lease in which that
Person is the lessor.

 

“Other Taxes” shall have the meaning assigned
to such term in Section 3.11(b).

 

“Outstanding Amount” means, with respect to the
Term Loans on any date, the aggregate outstanding principal amount thereof as
of such date.

 

“Participant” has the meaning assigned to such
term in clause (d) of Section 11.3.

 

“Participation Interest” means a purchase by a
Lender of a participation in any Loans as provided in Section 3.14.

 

16

 

“PBGC” means the Pension Benefit Guaranty
Corporation established pursuant to Subtitle A of Title IV of ERISA and
any successor thereof.

 

“Permitted Investments” means, at any time,
Investments by the Consolidated Parties permitted to exist at such time
pursuant to the terms of Section 8.6.

 

“Permitted Liens” means, at any time, Liens in
respect of Property of the Consolidated Parties permitted to exist at such time
pursuant to the terms of Section 8.2.

 

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

 

“Plan” means any employee benefit plan (as
defined in Section 3(3) of ERISA) which is covered by ERISA and with
respect to which any Consolidated Party or any ERISA Affiliate is (or, if such
plan were terminated at such time, would under Section 4069 of ERISA be
deemed to be) an “employer” within the meaning of Section 3(5) of ERISA.

 

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

 

“Prepayment Administration Fee” shall have the meaning assigned to such term in
Section 3.5(a).

 

“Prime Rate” means the per annum rate of interest
established from time to time by BOA as its prime rate, which rate may not be
the lowest rate of interest charged by BOA to its customers.

 

“Principal Borrower” shall have the meaning
given to such term in the introductory paragraph hereof.

 

“Pro Forma Basis” means, for purposes of
calculating (utilizing the principles set forth in the second paragraph of
Section 1.3) compliance with each of the Financial Covenants in respect of
a proposed transaction, that such transaction shall be deemed to have occurred
as of the first day of the applicable period for which a given calculation is
being performed.  As used herein, “transaction”
shall mean (i) any incurrence or assumption of Indebtedness as referred to
in Section 8.1(h)(i), or (ii) any Asset Disposition as referred to in
Section 8.5(a).  In connection with
any calculation of the Financial Covenants, upon giving effect to a transaction
on a Pro Forma Basis:

 

(A)          for
purposes of any such calculation in respect of any incurrence or assumption of
Indebtedness as referred to in Section 8.1(h)(i), any Indebtedness which
is retired in connection with such incurrence or assumption shall be excluded
and deemed to have been retired as of the first day of the applicable period;
and

 

(B)           for
purposes of any such calculation in respect of any Asset Disposition as
referred to in Section 8.5(a), (1) income statement
items (whether positive or negative) and capital expenditures attributable
to the Property disposed of shall be excluded and (2) any Indebtedness
which is retired in connection with such transaction shall be excluded and
deemed to have been retired as of the first day of the applicable period.

 

“Pro Forma Compliance Certificate” means a
certificate of an Executive Officer of the Borrower delivered to the Agent in
connection with (i) any incurrence, assumption or retirement of
Indebtedness as referred to in Section 8.1(h)(i), or (ii) any Asset
Disposition as referred to in Section 8.5(a), as applicable, and
containing reasonably detailed calculations, upon giving effect to the
applicable transaction on a Pro Forma Basis, of those items required for
determining compliance with Section 7.11 as of the most recent fiscal
quarter end preceding the date of the applicable transaction with respect to
which the Agent shall have received the Required Financial Information.

 

17

 

“Pro
Rata Share” means as to each Lender that is not a Defaulting
Lender, with respect to such Lender’s outstanding Loans at any time, a
fraction (expressed as a percentage, carried out to the ninth decimal place),
the numerator of which is the amount of the Loans of such Lender at such time
and the denominator of which is the Outstanding Amount (less all Loans held by
non-Defaulting Lenders) at such time. 
The initial Pro Rata Share of each Lender is set forth opposite the name
of such Lender on Schedule 1.1(a) or in the Assignment and
Assumption pursuant to which such Lender becomes a party hereto, as applicable.

 

“Property” means any interest in any kind of
property or asset, whether real, personal or mixed, or tangible or intangible.

 

“Qualified REIT Subsidiary”
shall have the meaning given to such term in the Code.

 

“Real Properties” means, at any time, a
collective reference to each of the facilities and real properties owned,
leased or operated by the Consolidated Parties or in which any Consolidated
Party has an interest at such time; and “Real Property” means any one of
such Real Properties.

 

“Related Parties” means, with respect to any
specified Person, such Person’s Affiliates and the respective directors,
officers, employees, agents and advisors of such Person and such Person’s
Affiliates.

 

“Replaced Credit Agreement”
means that certain Credit Agreement dated as of May 31, 2002 among the Borrower,
the Guarantors, the Agent, the lenders identified therein and BAS, as the same
has been amended, restated, supplemented or otherwise modified prior to the
date hereof.

 

“Register” shall have the meaning assigned to
such term in Section 11.3(c).

 

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

 

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

 

“Reportable Event” means any of the events set
forth in Section 4043(c) of ERISA, other than those events as to which the
notice requirement has been waived by regulation.

 

“Required Financial Information” means, with
respect to any given date, (i) the financial statements of the
Consolidated Parties required to be delivered pursuant to Section 7.1(a)
or (b) for the fiscal period or quarter ending most recently with respect to
such date, and (ii) the certificate of an Executive Officer of the
Borrower required by Section 7.1(c) to be delivered with the financial
statements described in clause (i) above.

 

“Required Lenders” means, at any time, (a) the
Agent, (b) the “Agent” under the Revolving Credit Agreement and (c) Lenders
(other than Defaulting Lenders) and Revolving Lenders holding in the aggregate
at least 66 2/3% of the Revolver/Term Outstanding Amount (excluding amounts
held by Defaulting Lenders).

 

“Required Term Loan Lenders” means, at any
time, (a) the Agent and (b) Lenders (other than Defaulting Lenders) holding in
the aggregate at least 66 2/3% of the Outstanding Amount.

 

“Requirement of Law” means, as to any Person,
the certificate of incorporation and by-laws or other organizational or
governing documents of such Person, and any law, treaty, rule or regulation or
determination of an arbitrator or a court or other Governmental Authority, in
each case applicable to or binding upon such Person or to which any of its
material property is subject.

 

“Restricted Payment” means (i) any
dividend or other payment or distribution, direct or indirect, on account of
any shares of any class of Capital Stock of any Consolidated Party, now or
hereafter outstanding (including without limitation any payment in connection
with any dissolution, merger, consolidation or disposition involving any
Consolidated Party), or to the holders, in their capacity as such, of any
shares of any

 

18

 

class of Capital
Stock of any Consolidated Party, now or hereafter outstanding (other than
dividends or distributions payable in Capital Stock of the applicable Person
and dividends or distributions payable (directly or indirectly through
Subsidiaries) to any Credit Party other than the General Partner),
(ii) any redemption, retirement, sinking fund or similar payment, purchase
or other acquisition for value, direct or indirect, of any shares of any class
of Capital Stock of any Consolidated Party, now or hereafter outstanding, (iii) any
payment made to retire, or to obtain the surrender of, any outstanding
warrants, options or other rights to acquire shares of any class of Capital
Stock of any Consolidated Party, now or hereafter outstanding, and
(iv) any loan or advance to the General Partner.

 

“Revolver Obligations” means, at any time, an
amount equal to the amount of the “Credit Party Obligations,” as defined in the
Revolving Credit Agreement.

 

“Revolver/Term Outstanding Amount” means an
amount equal to the sum of (a) (i) the Revolving Commitments (and
Participation Interests therein), or (ii) if the Revolving Commitments
have been terminated, the outstanding Loans, LOC Obligations and Participation
Interests (including the Participation Interests of the Issuing Lender in any
Letters of Credit), in each case, if any; provided, that all capitalized terms
used in this clause (a) shall have the meanings given to such terms in the
Revolving Credit Agreement), plus (b) the Outstanding Amount, if any.

 

“Revolving Credit Agreement” shall mean that
certain revolving Credit Agreement dated as of the date hereof among Borrower,
the Guarantors, BOA, as Agent and Issuing Lender, BAS and such other lenders as
may be party thereto from time to time, as the same may be amended, restated,
supplemented or otherwise modified from time to time following the date hereof.

 

“Revolving Credit Documents” means the “Credit
Documents” as such term is defined in the Revolving Credit Agreement.

 

“Revolving Lenders” means the “Lenders” as such
term is defined in the Revolving Credit Agreement; provided, that, for purposes
of this Agreement, such term shall not be deemed to include “Defaulting
Lenders” under the Revolving Credit Agreement.

 

“S&C” has
the meaning given to such term in the Preamble of this Credit Agreement.

 

“S&P” means Standard & Poor’s Ratings
Group, a division of The McGraw Hill Companies, Inc., or any successor or
assignee of the business of such division in the business of rating securities.

 

“Sale and Leaseback Transaction” means any
arrangement pursuant to which any Person, directly or indirectly, becomes
liable as lessee, guarantor or other surety with respect to any lease, whether
an Operating Lease or a Capital Lease, of any Property (a) which such
Person has sold or transferred (or is to sell or transfer) to a Person which is
not a consolidated affiliate of such Person or (b) which such Person
intends to use for substantially the same purpose as any other Property which
has been sold or transferred (or is to be sold or transferred) by such Person to
another Person which is not a consolidated affiliate of such Person in
connection with such lease.

 

“Secured Indebtedness”
means, with respect to any Person, any Indebtedness (other than Indebtedness
incurred hereunder or under the Revolving Credit Documents) that is secured in
any manner by any Lien.  Indebtedness in
respect of Capitalized Lease Obligations shall not be deemed to be Secured
Indebtedness.  For clarification
purposes,

 

(i) any unsecured guaranty given by any Credit Party of
secured indebtedness of a Person who is not a Credit Party constitutes
Unsecured Indebtedness of such Credit Party giving the guaranty,

 

(ii) any unsecured guaranty given by any Credit Party of
the secured indebtedness of another Credit Party constitutes the Secured
Indebtedness of the Credit Party directly incurring the secured indebtedness
and shall not be calculated as part of the Indebtedness (either Secured or

 

19

 

Unsecured)
of such Credit Party giving the guaranty (except to the extent that the
relevant calculation does not otherwise account for the Indebtedness of the
Credit Party directly incurring the underlying secured indebtedness, in which
case it shall constitute the Unsecured Indebtedness of the Credit Party giving
the guaranty),

 

(iii) any unsecured guaranty given by any Credit Party
of the unsecured indebtedness of a Person who is not a Credit Party constitutes
the Unsecured Indebtedness of such Credit Party giving the guaranty,

 

(iv) any unsecured guaranty given by any Credit Party of
the unsecured Indebtedness of another Credit Party constitutes the Unsecured
Indebtedness of the Credit Party directly incurring such Indebtedness and shall
not be calculated as part of the Indebtedness (either Secured or Unsecured) of
such Credit Party giving the guaranty (except to the extent that the relevant
calculation does not otherwise account for the Indebtedness of the Credit Party
directly incurring the underlying unsecured indebtedness, in which case it
shall constitute the Unsecured Indebtedness of the Credit Party giving the
guaranty),

 

(v) any secured guaranty given by any Credit Party of
secured indebtedness of a Person who is not a Credit Party constitutes Secured
Indebtedness of such Credit Party giving the guaranty,

 

(vi) any secured guaranty given by any Credit Party of
the secured indebtedness of another Credit Party constitutes the Secured
Indebtedness of the Credit Party directly incurring the secured indebtedness
and shall not be calculated as part of the Indebtedness (either Secured or
Unsecured) of such Credit Party giving the guaranty (except to the extent that
the relevant calculation does not otherwise account for the Indebtedness of the
Credit Party directly incurring the underlying secured indebtedness, in which
case it shall constitute the Secured Indebtedness of the Credit Party giving
the guaranty),

 

(vii) any secured guaranty given by any Credit Party of
the unsecured indebtedness of a Person who is not a Credit Party constitutes
the Secured Indebtedness of such Credit Party giving the guaranty, and

 

(viii) any secured guaranty given by any Credit Party of
the unsecured Indebtedness of another Credit Party constitutes the Secured
Indebtedness of such Credit Party giving the guaranty and shall not be calculated
as part of the Indebtedness (either Secured or Unsecured) of the Credit Party
directly incurring such Indebtedness (except to the extent that the relevant
calculation does not otherwise account for the Indebtedness of such Credit
Party giving the guaranty, in which case it shall constitute the Unsecured
Indebtedness of the Credit Party directly incurring the underlying unsecured
indebtedness).

 

“Secured Parties” shall have the meaning given to
such term in the Intercreditor Agreement.

 

“Securities Act” means the Securities Act of
1933, as amended, and all regulations issued pursuant thereto.

 

“Securitization Asset Sale”
means a transaction consisting of one or more limited recourse or nonrecourse
transfers by the Borrower, the General Partner or any of their Subsidiaries, to
a Special Purpose Entity, of promissory notes, mortgage loans, net leased real
property interests, investment securities representing an interest in or
secured by debt or equity tranches of investment securities, chattel paper,
leases or other similar financial assets originated by the General Partner, the
Borrower or any other Subsidiary thereof, together with any related title or
other insurance policies, hedge agreements and other assets directly related to
such financial assets, which transfers may properly be, and is, accounted for
on the consolidated balance sheet of the General Partner as a sale in
conformity with Financial Accounting Standards Board Statement of Financial
Accounting Standard No. 125 followed by either (x) limited recourse or
nonrecourse sales of such financial assets (or interests therein) by such
Special Purpose Entity

 

20

 

to one or more Persons the accounts of which would not be required to be
consolidated with those of the General Partner in their consolidated financial
statements in accordance with GAAP (provided that subordinated interests in
such financial assets and I/O Strips may be issued or sold to any Person) or
(y) the incurrence by such Special Purpose Entity of Indebtedness secured by a
Lien encumbering only the assets of such Special Purpose Entity; provided that
all of the Indebtedness, liabilities and other obligations of such Special
Purpose Entity incurred in connection with such transactions are nonrecourse
for the payment or performance thereof to the General Partner, the Borrower or
any other Subsidiary (excluding such Special Purpose Entity) other than the
following: (a) reasonable and customary obligations of the General Partner, the
Borrower or any other Subsidiary with respect to (i) the servicing of any
assets which are the subject of such transaction, (ii) administrative and
ministerial matters relating to such Special Purpose Entity, (iii) maintenance
of the corporate separateness of such Special Purpose Entity from that of the
General Partner and its other Subsidiaries, and (iv) the guaranty of payment of
fees of any Person acting as a trustee in connection with such transaction and
indemnification obligations owing to any such Person; (b) reasonable and
customary repurchase obligations and other liabilities resulting from the
breach of representations, warranties and covenants that are not related to
creditworthiness of the obligors on the financial assets the subject of such
transactions and (c) limited recourse provisions giving rise to Indebtedness
solely to the extent permitted under Section 8.1.  For purposes of this definition, whether an
obligation or liability is “reasonable and customary” shall be determined with
reference to terms of similar transactions prevailing as of the date hereof.

 

“Securities Exchange Act” means the Securities
Exchange Act of 1934, as amended, and all regulations issued pursuant thereto.

 

“Security Documents” means a collective
reference to , the USRP Pledge Agreement, the USRP Holding Pledge Agreement,
the JV1 Pledge Agreement, any UCC financing
statements securing payment under any of such documents, and any other
documents securing the obligations of the Credit Parties under this Credit
Agreement or any other Credit Document (in each case as the same may be
amended, modified, restated, supplemented, extended, renewed or replaced from
time to time).

 

“Single Employer Plan” means any Plan which is
covered by Title IV of ERISA, but which is not a Multiemployer Plan or a
Multiple Employer Plan.

 

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

 

“Special Purpose Entity” means any Person (a)
which has a legal structure and capitalization intended to make such entity a
“bankruptcy remote” entity and which legal structure and capitalization have
been approved in writing by the Agent; (b) which has been organized for the
sole purpose of effecting a structured financing; (c) which has no assets other
than (i) the financial assets directly acquired in connection with, and which
are the subject of, such structured financing, and any related title or other
insurance policies, hedge agreements and other assets directly related to such
financial assets, (ii) cash and other assets contributed or distributed to such
Person, or otherwise acquired by it, in connection with such structured
financing, and which assets are retained by such Person either pursuant to the
requirements of such structured financing or to permit it to fulfill its
obligations under the terms of such structured

 

21

 

financing,
(iii) assets which such Person is to (and does in fact) dispose of promptly,
and in any event within two Business Days, following such Person’s acquisition
of such assets, and (iv) in the case of a Securitization Asset Sale,
subordinated interests acquired in connection with such Securitization Asset Sale;
(d) which has no Indebtedness, liabilities or other obligations other than (i)
those directly incurred in connection with such structured financing, (ii) any
liabilities resulting from representations and warranties made by such Person
with respect to any such financial assets or other assets being transferred by
it to another Person so long as such representations and warranties (A) are
customary or (B) are substantially similar to those made to such Person when
such assets were initially transferred to it and (iii) trade payables incurred
in the ordinary course of trade or business in an aggregate amount not to
exceed $100,000; and (e) which none of the General Partner, the Borrower or any
other Subsidiaries thereof have any direct obligation to maintain or preserve
such Person’s financial condition or to cause such Person to achieve any
specified levels of operating results except as otherwise permitted in
connection with such structured financing.

 

“Subordinated Interest”
means a subordinate interest (whether characterized as debt or equity, and
including without limitation, general and limited partnership interests,
participation certificates and trust certificates) in a pool of promissory
notes, mortgage loans, chattel paper, leases or other similar financial assets,
issued in connection with a Securitization Asset Sale or otherwise.

 

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

 

“Subsidiary Guarantor” means each of the
Persons identified as a “Subsidiary Guarantor” on the signature pages hereto
and each Person which may hereafter execute a Joinder Agreement pursuant to
Section 7.12, together with their successors and permitted assigns, and “Subsidiary
Guarantor” means any one of them.

 

“Synthetic Lease” means any synthetic lease,
tax retention operating lease, off-balance sheet loan or similar off-balance
sheet financing product where such transaction is considered borrowed money indebtedness
for tax purposes but is classified as an Operating Lease under GAAP.

 

“Tangible Net Worth” means, as of any given
calculation date, (a) Total Tangible Assets, less (b) the sum of (i)
Total Liabilities less (ii) the aggregate of the amounts added to Total
Liabilities pursuant to clauses (b) and (d) of the definition thereof and in
connection with proviso items (i) and (ii)(A) and (C) contained in such
definition.

 

“Taxes” shall have the meaning assigned to such
term in Section 3.11(a).

 

“Tenant” means any Person (or their respective
Affiliates) who is a lessee with respect to any lease held by the Borrower as
lessor or as an assignee of the lessor thereunder.

 

“Term Loan” or “Term Loans” shall have
the meanings assigned to such terms in Section 2.1(a) hereof.

 

“Term Note” or “Term Notes” means the
promissory notes of the Borrower in favor of each Lender provided pursuant to
Section 2.1(a) and evidencing the Term Loans of such Lender, individually
or collectively, as appropriate, as such promissory notes may be amended,
modified, restated, supplemented, extended, renewed or replaced from time to
time.

 

“Term Securitization”
means a Securitization Asset Sale (a) involving only a single transfer (or
series of related and substantially contemporaneous transfers) to a Special
Purpose Entity of financial

 

22

 

assets, and any related title or other insurance policies, hedge
agreements and other assets directly related to such financial assets, by the
General Partner, the Borrower or any other Subsidiary thereof other than any
transfer of such assets (i) being substituted for any asset previously
transferred pursuant to customary and reasonable repurchase and substitution
obligations resulting from the breach of representations, warranties and
covenants that are not related to the creditworthiness of the obligor on the
financial assets or (ii) being substituted for cash collateral or a cash
deposit (including in connection with reasonable and customary “pre-funding”
arrangements), and (b) under which the Persons acquiring such financial assets
(or interests therein) from the applicable Special Purpose Entity or making
advances to such Special Purpose Entity secured directly or indirectly by such
financial assets, are neither required nor permitted to acquire additional
financial assets (or interests therein) from, or otherwise make additional
advances to, such Special Purpose Entity, except as otherwise permitted under
the immediately preceding clause (a).

 

“Total Liabilities”
means the sum of (a) total liabilities of the Consolidated Parties on a
consolidated basis, as determined in accordance with GAAP, plus (b) an
amount equal to the aggregate total liabilities, as determined in accordance
with GAAP, of each Unconsolidated Affiliate multiplied by the respective
Unconsolidated Affiliate Interest of each such entity plus (c) without
duplication, the Indebtedness of the Consolidated Parties on a consolidated
basis plus (d) without duplication, the aggregate of Indebtedness
(including, without limitation, all Contingent Obligations) of each
Unconsolidated Affiliate multiplied by the respective Unconsolidated Affiliate
Interest of each such entity; provided, that (i) in each case, all of the above
amounts not otherwise adjusted to account for Minority Interests shall be
adjusted to deduct therefrom the pro rata share of such amounts allocable to
the Minority Interests (except to the extent any Credit Party would be legally
liable for the full amount of such liabilities) and (ii) notwithstanding
anything contained herein to the contrary, “Total Liabilities” shall include,
without duplication (A) all obligations of
any Consolidated Party to purchase, redeem, retire, defease or otherwise make
any payment in respect of any Preferred Stock of any entity in which it owns
any Capital Stock, valued, in the case of redeemable Preferred Stock, at the
greater of its voluntary or involuntary liquidation preference plus accrued and
unpaid dividends; (B) the maximum amount that could be owed by any
Consolidated Party with respect to all of such Consolidated Party’s other
Preferred Stock and (C) the amount equal to (1) the maximum amount that could
be owed by any Unconsolidated Affiliate with respect to such Unconsolidated
Affiliate’s Preferred Stock, multiplied by (2) the respective Unconsolidated
Affiliate Interest of each such entity.

 

“Total Rent” means, with respect to rental
income used in calculating Borrowing Base Asset Value, gross rental income from
all Borrowing Base Assets over the applicable period.

 

“Total Tangible Assets” means the sum of (a)
Asset Values of each of the Real Properties, plus (b) the book value of
all other assets and interests therein held by the Consolidated Parties
(provided, that, the amounts calculated pursuant to clauses (a) and (b) above
(i) shall include, without duplication, each Consolidated Parties’ interests in
the assets of any Unconsolidated Affiliate and (ii) shall not include any
interests in assets which are attributable to any Minority Interests), less
(c) the value of all intangible assets, if any, included in (a) and (b) above.

 

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

 

“Unconsolidated Affiliate Interest” means the
percentage of the Capital Stock or other equity interest owned by a
Consolidated Party in a Unconsolidated Affiliate accounted for pursuant to the
equity method of accounting under GAAP.

 

“Unconsolidated Affiliate” means any
corporation, partnership, association, joint venture or other entity, in each
case which is not a Consolidated Party, in which a Consolidated Party owns,
directly or indirectly, Capital Stock or any other equity interest.

 

“Unsecured Indebtedness”
means, with respect to any Person and for any given calculation date, all
Indebtedness of such Person that is not Secured Indebtedness, including all
Indebtedness in respect of Capitalized Lease Obligations (subject to the
provisions and allocation rules set forth in the definition of

 

23

 

“Secured Indebtedness” set forth herein). For purposes of calculating the
Financial Covenants, the Credit Party Obligations and the Revolver Obligations
shall be deemed Unsecured Indebtedness.

 

“USRP Holding” has the meaning given to such term in the Preamble of this Credit
Agreement.

 

“USRP Holding Pledge Agreement” means that certain Pledge and Security Agreement
entered into by USRP Holding as of November 4, 2003 in favor of the Collateral Agent and for the benefit of the Creditor
Group.

 

“USRP Operating” has the
meaning given to such term in the Preamble of this Credit Agreement.

 

“USRP Pledge Agreement”
means that certain Pledge and Security Agreement entered into by USRP Operating
as of the date hereof in favor of the Collateral Agent and for the benefit of
the Creditor Group.

 

“USRP REIT” means
U.S.  Restaurant Properties, Inc..

 

“Value” means, with respect to any Consolidated
Party’s interest in any Real Property, the book value of such interest in Real
Property plus accumulated depreciation with respect thereto (provided,
for purposes of clarification, that the “Value” of any interest in Real
Property shall not include any amount of the book value of such Real Property
interest attributable to Minority Interests).

 

“Voting Stock” means, with respect to any
Person, Capital Stock issued by such Person the holders of which are
ordinarily, in the absence of contingencies, entitled to vote for the election
of directors (or persons performing similar functions) of such Person, even though
the right so to vote has been suspended by the happening of such a contingency.

 

“Wholly Owned Subsidiary” means any Person 100%
of whose Voting Stock is at the time owned by the Borrower directly or
indirectly through other Persons 100% of whose Voting Stock is at the time
owned, directly or indirectly, by the Borrower.

 

1.2          Computation of Time Periods.

 

For purposes of
computation of periods of time hereunder, the word “from” means “from and
including” and the words “to” and “until” each mean “to but excluding.”

 

1.3          Accounting Terms.

 

Except as
otherwise expressly provided herein, all accounting terms used herein shall be
interpreted, and all financial statements and certificates and reports as to
financial matters required to be delivered to the Lenders hereunder shall be
prepared, in accordance with GAAP applied on a consistent basis; provided,
however, that calculations of the implied principal component of all
obligations under any Synthetic Lease or the implied interest component of any
rent paid under any Synthetic Lease shall be made by the Borrower in accordance
with accepted financial practice and consistent with the terms of such
Synthetic Lease.  All calculations made
for the purposes of determining compliance with this Credit Agreement shall
(except as otherwise expressly provided herein) be made by application of GAAP
applied on a basis consistent with the most recent annual or quarterly
financial statements delivered pursuant to Section 7.1 (or, prior to the
delivery of the first financial statements pursuant to Section 7.1,
consistent with the financial statements as at September 30, 2003), but, in any
event, after elimination for Unconsolidated Affiliate Interests;  provided,
however, if (a) the Credit Parties shall object to determining such
compliance on such basis at the time of delivery of such financial statements
due to any change in GAAP or the rules promulgated with respect thereto or
(b) the Agent or the Required Lenders shall so object in writing within 60
days after delivery of such financial statements, then such calculations shall
be made on a basis consistent with the most recent financial statements
delivered by the Credit Parties to the Lenders as to which no such objection
shall have been made.

 

Notwithstanding
the above or anything contained herein to the contrary, the provisions set
forth in FAS 133 shall not be used in accounting for derivatives instruments
and hedging activities in the definitions contained herein.

 

24

 

1.4          References to Agreements and Laws.

 

Unless otherwise
expressly provided herein, (a) references to organizational documents,
agreements (including the Credit Documents and the Revolving Credit Documents)
and other contractual instruments shall be deemed to include all subsequent
amendments, restatements, extensions, supplements and other modifications
thereto, but only to the extent that such amendments, restatements, extensions,
supplements and other modifications are not prohibited by any Credit Document;
and (b) references to any law, rule, regulation, mandate, standard or
requirement shall include all provisions consolidating, amending, replacing,
supplementing or interpreting such law, rule, regulation, mandate, standard or
requirement.

 

1.5          Times of Day.

 

Unless otherwise
specified, all references herein to times of day shall be deemed to be
references to Charlotte, North Carolina time.

 

ARTICLE II

CREDIT FACILITIES

 

2.1          Term Loans.

 

(a)           Term
Loan Commitment.  Subject to the
terms and conditions set forth herein, each Lender severally agrees to make a
loan (each such loan, a “Term Loan” and, collectively, the “Term
Loans”) to the Borrower in an aggregate amount not to exceed the amount of
such Lender’s Commitment.  Amounts
repaid on the Term Loans may not be reborrowed.  The Borrower shall make principal and interest payments on the
Term Loans in accordance with the terms hereof.  Each Term Loan shall be evidenced by a promissory note of the
Borrower to the appropriate Lender in substantially the form of Exhibit C
(each a “Term Note”).  The Term
Loans may, from time to time at the option of the Borrower (subject to the
terms and conditions set forth in this Credit Agreement, including, without
limitation, Sections 2.1(d) and 3.2), consist of Base Rate Loans or Eurodollar
Loans, or a combination thereof, as the Borrower may request (subject to the
terms and conditions set forth herein); provided, however, that
no more than five (5)  Eurodollar Loans shall be outstanding
hereunder at any time (it being understood that, for purposes hereof,
Eurodollar Loans with different Interest Periods shall be considered as
separate Eurodollar Loans, even if they begin on the same date, although
borrowings, extensions and conversions may, in accordance with the provisions
hereof, be combined at the end of existing Interest Periods to constitute a new
Eurodollar Loan with a single Interest Period).

 

(b)           Borrowing
Procedures.

 

(i)            Notwithstanding anything contained
herein to the contrary, (A) the Borrower shall be entitled to no more than one
advance (the “Advance”) of the Term Loans hereunder, (B) the Advance
shall be in an amount equal to or less than the Maximum Loan Amount and (C) to
the extent the Borrower has not requested the Advance on or before November 15,
2003, this Credit Agreement and the Lenders’ respective obligations and
commitments to make the Term Loans shall automatically terminate without notice
to the Borrower; provided, however, that Borrower shall remain responsible for
payment of all costs and expenses incurred by the Administrative Agent in
accordance with Sections 5.1(f) and 11.5 hereof and for all
applicable fees due and owing pursuant to the terms hereof.  The Borrower shall submit an appropriate
Notice of Borrowing to the Agent not later than 11:00 A.M. (Charlotte, North
Carolina time) on the Business Day most nearly preceding the date on which it
desires to receive the Advance (which date shall be a Business Day).  Such Notice of Borrowing shall be irrevocable,
shall specify (1) the amount of the advance requested, (2) the date on which it
request the Advance to be made, (3) whether the Advance shall be comprised of
Base Rate Loans, Eurodollar Loans or a combination thereof, and if Eurodollar
Loans are requested, the Interest Period(s) therefor and (4) shall contain
certifications of an Executive Officer of the Borrower stating that each of the

 

25

 

conditions set forth in
Sections 5.1 and 5.2 hereof for the making of the Advance have been satisfied
as of the date of such requested Advance.

 

(ii)           Following receipt of a Notice of
Borrowing, the Agent shall promptly notify each Lender of the amount of its Pro
Rata Share of the Advance requested therein and each Lender shall make its Term
Loan (in an amount not to exceed such Lender’s Commitment) available to the
Agent in immediately available funds not later than 1:00 p.m. on the
Business Day specified in the applicable Notice of Borrowing.  Upon satisfaction of the applicable
conditions set forth in Sections 5.1 and 5.2, the Agent
shall make all funds so received available to the Borrower in like funds as
received by the Agent by wire transfer of such funds in accordance with
instructions provided to (and reasonably acceptable to) the Agent by the
Borrower.

 

(c)           Principal
Payments.  Except to the extent
accelerated or otherwise due sooner pursuant to the provisions hereof or of any
other Credit Document, the Borrower shall not be required to make any principal
payments on the Term Loans until the Maturity Date.  The entire principal balance of the Term Loans shall be due and
payable as of the Maturity Date. 
Notwithstanding anything to the contrary contained herein, to the extent
the principal balance of the Term Loans is accelerated pursuant to the terms of
the Credit Documents, the entire Outstanding Amount and all other amounts due
under the Credit Documents shall be immediately due and payable as of the date
of such acceleration.

 

(d)           Interest.  Subject to the provisions of
Section 3.1,

 

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

 

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

 

Interest on Term
Loans shall be payable in arrears on each applicable Interest Payment Date (or
at such other times as may be specified herein).

 

2.2          Joint and Several Liability of the
Borrowers.

 

(a)           Each
of the Borrowers is accepting joint and several liability hereunder in
consideration of the financial accommodation to be provided by the Lenders under
this Credit Agreement, for the mutual benefit, directly and indirectly, of each
of the Borrowers and in consideration of the undertakings of each of the
Borrowers to accept joint and several liability for the obligations of each of
them.

 

(b)           Each
of the Borrowers jointly and severally hereby irrevocably and unconditionally
accepts, not merely as a surety but also as a co-debtor, joint and several
liability with the other Borrowers with respect to the payment and performance
of all of the Credit Party Obligations arising under this Credit Agreement and
the other Credit Documents, it being the intention of the parties hereto that
all the Credit Party Obligations shall be the joint and several obligations of
each of the Borrowers without preferences or distinction among them.

 

(c)           If
and to the extent that any of the Borrowers shall fail to make any payment with
respect to any of the obligations hereunder as and when due or to perform any
of such obligations in accordance with the terms thereof, then in each such
event, the other Borrowers will make such payment with respect to, or perform,
such obligation.

 

(d)           The
obligations of each Borrower under the provisions of this Section 2.2
constitute full recourse obligations of such Borrower, enforceable against it
to the full extent of its properties and assets,

 

26

 

irrespective of
the validity, regularity or enforceability of this Credit Agreement or any
other circumstances whatsoever.

 

(e)           Except
as otherwise expressly provided herein, each Borrower hereby waives notice of
acceptance of its joint and several liability, notice of occurrence of any
Default or Event of Default (except to the extent notice is expressly required
to be given pursuant to the terms of this Credit Agreement), or of any demand
for any payment under this Credit Agreement, notice of any action at any time
taken or omitted by the Lender under or in respect of any of the Credit Party
Obligations hereunder, any requirement of diligence and, generally, all
demands, notices and other formalities of every kind in connection with this
Credit Agreement.  Each Borrower hereby
assents to, and waives notice of, any extension or postponement of the time for
the payment of any of the Credit Party Obligations hereunder, the acceptance of
any partial payment thereon, any waiver, consent or other action or
acquiescence by the Lenders at any time or times in respect of any default by
any Borrower in the performance or satisfaction of any term, covenant, condition
or provision of this Credit Agreement, any and all other indulgences whatsoever
by the Lenders in respect of any of the Credit Party Obligations hereunder, and
the taking, addition, substitution or release, in whole or in part, at any time
or times, of any security for any of such Credit Party Obligations or the
addition, substitution or release, in whole or in part, of any Borrower.  Without limiting the generality of the
foregoing, each Borrower assents to any other action or delay in acting or any
failure to act on the part of the Lender, including, without limitation, any
failure strictly or diligently to assert any right or to pursue any remedy or
to comply fully with applicable laws or regulations thereunder which might, but
for the provisions of this Section 2.2, afford grounds for terminating,
discharging or relieving such Borrower, in whole or in part, from any of its
obligations under this Section 2.2, it being the intention of each
Borrower that, so long as any of the Credit Party Obligations hereunder remain
unsatisfied, the obligations of such Borrower under this Section 2.2 shall
not be discharged except by performance and then only to the extent of such
performance.  The obligations of each
Borrower under this Section 2.2 shall not be diminished or rendered
unenforceable by any winding up, reorganization, arrangement, liquidation,
reconstruction or similar proceeding with respect to any reconstruction or
similar proceeding with respect to any Borrower or any Lender.  The joint and several liability of the
Borrowers hereunder shall continue in full force and effect notwithstanding any
absorption, merger, amalgamation or any other change whatsoever in the name,
membership, constitution or place of formation of any Borrower or any Lender.

 

(f)            The
provisions of this Section 2.2 are made for the benefit of the Agent and
the Lenders and their respective successors and assigns, and may be enforced by
any such Person from time to time against any of the Borrowers as often as
occasion therefor may arise and without requirement on the part of any Lender
first to marshal any of its claims or to exercise any of its rights against any
of the other Borrowers or to exhaust any remedies available to it against any
of the other Borrowers or to resort to any other source or means of obtaining
payment of any of the Credit Party Obligations or to elect any other
remedy.  Without limiting the generality
of the foregoing, each Borrower hereby specifically waives the benefits of N.C.  Gen. 
Stat.  §§26-7 through 26-9, inclusive,
to the extent applicable.  The
provisions of this Section 2.2 shall remain in effect until all the Credit
Party Obligations hereunder shall have been paid in full or otherwise fully
satisfied.  If at any time, any payment,
or any part thereof, made in respect of any of the Credit Party Obligations, is
rescinded or must otherwise be restored or returned by the Lenders upon the
insolvency, bankruptcy or reorganization of any of the Borrowers, or otherwise,
the provisions of this Section 2.2 will forthwith be reinstated and in
effect as though such payment had not been made.

 

(g)           Notwithstanding
any provision to the contrary contained herein or in any other of the Credit
Documents or Hedging Agreements, the obligations of each Borrower hereunder
shall be limited to an aggregate amount equal to the largest amount that would
not render its obligations hereunder subject to avoidance under
Section 548 of the Bankruptcy Code or any comparable provisions of any
applicable state law.

 

27

 

2.3          Appointment of Principal Borrower
as Agent for Borrowers.

 

Each Borrower
hereby appoints the Principal Borrower to act as its exclusive agent for all
purposes under this Credit Agreement and the other Credit Documents (including,
without limitation, with respect to all matters related to the borrowing and
repayment of loans as described in Articles II and III hereof).  Each Borrower acknowledges and agrees that
(a) the Principal Borrower may execute such documents on behalf of all the
Borrowers as the Principal Borrower deems appropriate in its sole discretion
and each Borrower shall be bound by and obligated by all of the terms of any
such document executed by the Principal Borrower on its behalf, (b) any notice
or other communication delivered by the Agent or any Lender hereunder to the
Principal Borrower shall be deemed to have been delivered to each Borrower and
(c) the Agent and each of the Lenders shall accept (and shall be permitted to
rely on) any document or agreement executed by the Principal Borrower on behalf
of the Borrowers (or any of them).  The
Borrowers must act through the Principal Borrower for all purposes under this
Credit Agreement and the other Credit Documents.  Notwithstanding anything contained herein to the contrary, to the
extent any provision in this Credit Agreement requires any Borrower to interact
in any manner with the Agent or the Lenders, such Borrower shall do so through
the Principal Borrower.

 

ARTICLE III

OTHER PROVISIONS RELATING TO CREDIT FACILITIES

 

3.1          Default Rate.

 

Upon the
occurrence, and during the continuance, of an Event of Default, the principal
of and, to the extent permitted by law, interest on the Loans and any other
amounts owing hereunder or under the other Credit Documents shall bear
interest, payable on demand, at a per annum at a per annum rate equal to the
Adjusted Base Rate plus five percent (5.0%).

 

3.2          Continuation/Conversion.

 

(a)           So
long as no Event of Default shall have occurred and be continuing and to the
extent permitted in the definition of the term “Interest Period”, the Borrower
may on any Business Day, with respect to any Eurodollar Loan, elect to maintain
such Eurodollar Loan or any portion thereof as a Eurodollar Loan by selecting a
new Interest Period for such Eurodollar Loan. 
Each new Interest Period selected under this Section 3.2 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, (a)
specifying (i) the proposed date of such Continuation, (ii) the Eurodollar Loan
and portion thereof subject to such Continuation and (iii) 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 and (b)
containing certifications of the Borrower with respect to the conditions set
forth in Section 5.2 clauses (b) through (e) as set forth in Exhibit 3.2.  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 Party 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 Eurodollar Loan in accordance with
this Section 3.2(a), such Loan will automatically, on the last day of the
current Interest Period therefor, Convert into a Base Rate Loan notwithstanding
failure of the Borrower to comply with Section 3.2(b).

 

(b)           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 Eurodollar Loan into a Base Rate Loan shall be made on, and only on, the last
day of an Interest Period for such Eurodollar Loan and, upon Conversion of a
Base Rate Loan into a Eurodollar 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 12:00 noon on the Business Day prior to the date of any

 

28

 

proposed
Conversion into Base Rate Loans and on the third Business Day prior to the date
of any proposed Conversion into Eurodollar Loans.  Promptly after receipt of a Notice of Conversion, the Agent shall
notify each Lender Party 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 (a)
specifying (i) the requested date of such Conversion, (ii) the Type of Loan to
be Converted, (iii) the portion of such Type of Loan to be Converted, (iv) the
Type of Loan such Loan is to be Converted into and (v) if such Conversion is
into a Eurodollar Loan, the requested duration of the Interest Period of such
Loan, and (b) containing certifications of the Borrower with respect to
the conditions set forth in Section 5.2 clauses (b) through (e) as
set forth in Exhibit 3.2.  Each Notice of Conversion shall be
irrevocable by and binding on the Borrower once given.

 

3.3          Prepayments.

 

(a)           Voluntary Prepayments.  The Borrower shall have the right to prepay
Loans in whole or in part from time to time; provided, however,
that (i) each partial prepayment of Loans shall be in a minimum principal
amount of $500,000 and integral multiples of $100,000 in excess thereof (or the
then remaining principal balance of the Loans, (ii) each partial prepayment
shall be accompanied by interest on the principal amount prepaid through the
date of prepayment and include payment for any and all applicable fees,
expenses, breakage costs and redeployment costs incurred by the Lenders and the
Agent as a result thereof (as such amounts are reasonably calculated by the
Lenders and the Agent, as applicable, and communicated to the Borrower), (iii)
each partial prepayment shall be accompanied by any Prepayment Administration
Fee payable in connection with such prepayment and (iv) all such voluntary prepayments
shall be made to the Collateral Agent for allocation in accordance with the
Intercreditor Agreement.  Subject to the
foregoing terms, amounts prepaid under this Section 3.3(a) shall be
applied as the Borrower may elect; provided that if the Borrower shall
fail to specify with respect to any voluntary prepayment, such voluntary
prepayment shall be applied first to Base Rate Loans and then to Eurodollar
Loans in direct order of Interest Period maturities.  All prepayments under this Section 3.3(a) shall be subject
to Section 3.12.

 

(b)           Mandatory Prepayments.

 

(i)                                     (A)          Maximum Loan Amount.  If, at any time, the Outstanding Amount,
shall exceed the Maximum Loan Amount, the Borrower immediately shall prepay the
Loans in an amount sufficient to eliminate such excess.

 

(B)           Borrowing Base Asset Value.  If, at any time, the sum of (1) the
Outstanding Amount, plus (2) the Revolver Obligations shall exceed the
Borrowing Base, the Borrower immediately shall prepay the Loans and/or the
Revolver Obligations (as determined by the distribution provisions of the
Intercreditor Agreement) in an amount sufficient to eliminate such excess.

 

(ii)           Application
of Mandatory Prepayments. All prepayments under this Section 3.3(b)
shall be subject to Section 3.12, but otherwise without premium or
penalty, and shall be accompanied by interest on the principal amount prepaid
through the date of prepayment.  All
amounts required to be paid pursuant to this Section 3.3(b) shall be applied
first, to 100% of the outstanding interest with respect to the Term Loans being
prepaid and, thereafter, to the principal balance of the Term Loans. All
prepayments made hereunder shall be made to the Collateral Agent for allocation
in accordance with the Intercreditor Agreement.  Within the parameters of the applications set forth above,
prepayments shall be applied first to Base Rate Loans and then to Eurodollar
Loans in direct order of Interest Period maturities.

 

3.4          Intentionally Omitted.

 

3.5          Fees.

 

(a)           To the extent Borrower makes any
prepayment of the Loans pursuant to Section 3.3(a) during the period commencing
on the Closing Date and ending as of the date occurring twelve (12)

 

29

 

calendar months
thereafter, Borrower shall, together with the applicable prepayment, pay to the
Agent (for the benefit of the Lenders) a prepayment administration fee (the “Prepayment
Administration Fee”) in an amount equal to one percent (1.0%) of the
principal amount of the Loans being prepaid.

 

(b)           In addition to the foregoing,
Borrower shall pay to the Agent and BAS the fees required pursuant to the terms
of the Fee Letter.

 

3.6          Capital Adequacy.

 

If any Lender has
determined, after the date hereof, that the adoption or the becoming effective
of, or any change in, or any change by any Governmental Authority, central bank
or comparable agency charged with the interpretation or administration thereof
in the interpretation or administration of, any applicable law, rule or
regulation regarding capital adequacy, or compliance by such Lender with any
request or directive regarding capital adequacy (whether or not having the
force of law) of any such authority, central bank or comparable agency, has or
would have the effect of reducing the rate of return on such Lender’s capital
or assets as a consequence of its Loans or obligations hereunder to a level
below that which such Lender could have achieved but for such adoption,
effectiveness, change or compliance (taking into consideration such Lender’s
policies with respect to capital adequacy), then, upon notice from such Lender
to the Borrower, the Borrower shall be obligated to pay to such Lender such
additional amount or amounts as will compensate such Lender for such reduction
(without duplication of any amount received by Lender by virtue of the
definition of the term “Eurodollar Reserve Requirement”).  Each determination by any such Lender of
amounts owing under this Section shall, absent manifest error, be
conclusive and binding on the parties hereto.

 

3.7          Limitation on Eurodollar Loans.

 

If on or prior to the
first day of any Interest Period for any Eurodollar Loan:

 

(a)           the
Agent 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 Eurodollar Rate for such Interest Period; or

 

(b)           the
Required Lenders determine (which determination shall be conclusive) and notify
the Agent that the Eurodollar Rate will not adequately and fairly reflect the
cost to the Lenders of funding Eurodollar Loans for such Interest Period;

 

then the Agent
shall give the Borrower prompt notice thereof, and so long as such condition
remains in effect, the Lenders shall be under no obligation to make additional
Eurodollar Loans, Continue Eurodollar Loans, or to Convert Base Rate Loans into
Eurodollar Loans and the Borrower shall, on the last day(s) of the then current
Interest Period(s) for the outstanding Eurodollar Loans, either prepay such
Eurodollar Loans or Convert such Eurodollar Loans into Base Rate Loans in
accordance with the terms of this Credit Agreement.

 

3.8          Illegality.

 

Notwithstanding
any other provision of this Credit Agreement, in the event that it becomes
unlawful for any Lender or its Applicable Lending Office to make, maintain, or
fund Eurodollar Loans hereunder, then such Lender shall promptly notify the
Borrower thereof and such Lender’s obligation to make or Continue Eurodollar
Loans and to Convert Base Rate Loans into Eurodollar Loans shall be suspended until
such time as such Lender may again make, maintain, and fund Eurodollar Loans
(in which case the provisions of Section 3.10 shall be applicable).

 

3.9          Requirements of Law.

 

If, after the date
hereof, the adoption of any applicable law, rule, or regulation, or any change
in any applicable law, rule, or regulation, or any change in the interpretation
or administration thereof by any Governmental Authority, central bank, or
comparable agency charged with the interpretation or administration thereof, or
compliance by any Lender (or its Applicable Lending Office) with any request or
directive (whether or not having the force of law) of any such Governmental
Authority, central bank, or comparable agency:

 

30

 

(i)        shall subject such Lender (or its
Applicable Lending Office) to any tax, duty, or other charge with respect to
any Eurodollar Loans, its Notes, or its obligation to make Eurodollar Loans, or
change the basis of taxation of any amounts payable to such Lender (or its
Applicable Lending Office) under this Credit Agreement or its Notes in respect
of any Eurodollar Loans (other than taxes imposed on the overall net income of
such Lender by the jurisdiction in which such Lender has its principal office
or such Applicable Lending Office);

 

(ii)       shall impose, modify, or deem applicable
any reserve, special deposit, assessment, or similar requirement (other than
the Eurodollar Reserve Requirement utilized in the determination of the
Adjusted Eurodollar Rate) relating to any extensions of credit or other assets
of, or any deposits with or other liabilities or commitments of, such Lender
(or its Applicable Lending Office), including the Commitment of such Lender
hereunder; or

 

(iii)      shall impose on such Lender (or its Applicable
Lending Office) or the London interbank market any other condition affecting
this Credit Agreement or its Notes or any of such extensions of credit or
liabilities or commitments;

 

and
the result of any of the foregoing is to increase the cost to such Lender (or
its Applicable Lending Office) of making, Converting into, Continuing, or
maintaining any Eurodollar Loans or to reduce any sum received or receivable by
such Lender (or its Applicable Lending Office) under this Credit Agreement or
its Notes with respect to any Eurodollar Loans, then the Borrower shall pay to
such Lender on demand such amount or amounts as will compensate such Lender for
such increased cost or reduction.  If
any Lender requests compensation by the Borrower under this Section 3.9,
the Borrower may, by notice to such Lender (with a copy to the Agent), suspend
the obligation of such Lender to make or Continue Eurodollar Loans, or to
Convert Base Rate Loans into Eurodollar Loans, until the event or condition
giving rise to such request ceases to be in effect (in which case the
provisions of Section 3.10 shall be applicable); provided that such
suspension shall not affect the right of such Lender to receive the
compensation so requested.  Each Lender
shall promptly notify the Borrower and the Agent of any event of which it has
knowledge, occurring after the date hereof, which will entitle such Lender to
compensation pursuant to this Section 3.9 and will designate a different
Applicable Lending Office if such designation will avoid the need for, or
reduce the amount of, such compensation and will not, in the judgment of such
Lender, be otherwise disadvantageous to it. 
Any Lender claiming compensation under this Section 3.9 shall
furnish to the Borrower and the Agent a statement setting forth the additional
amount or amounts to be paid to it hereunder which shall be conclusive in the
absence of manifest error.  In
determining such amount, such Lender may use any reasonable averaging and
attribution methods.

 

3.10        Treatment of Affected Loans.

 

If the obligation of any
Lender to make any Eurodollar Loan or to Continue, or to Convert Base Rate
Loans into, Eurodollar Loans shall be suspended pursuant to Section 3.7,
3.8 or 3.9 hereof, such Lender’s Eurodollar Loans shall be automatically Converted
into Base Rate Loans on the last day(s) of the then current Interest Period(s)
for such Eurodollar Loans (or, in the case of a Conversion, 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 3.7, 3.8 or 3.9 hereof that gave rise
to such Conversion no longer exist:

 

(a)           to
the extent that such Lender’s Eurodollar Loans have been so Converted, all
payments and prepayments of principal that would otherwise be applied to such
Lender’s Eurodollar 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 Eurodollar
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 Eurodollar 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 3.7, 3.8 or 3.9 hereof that gave rise to the
Conversion of such Lender’s Eurodollar Loans pursuant to this Section 3.10
no longer exist (which such Lender agrees to do promptly upon such
circumstances ceasing to exist) at a time when Eurodollar Loans made by other
Lenders are outstanding, 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 Eurodollar Loans, to the

 

31

 

extent necessary
so that, after giving effect thereto, all Loans held by the Lenders holding
Eurodollar Loans and by such Lender are held pro rata (as to principal amounts,
interest rate basis, and Interest Periods) in accordance with their respective
Commitments.

 

3.11        Taxes.

 

(a)           Any
and all payments by any Credit Party to or for the account of any Lender or the
Agent hereunder or under any other Credit Document shall be made free and clear
of and without deduction for any and all present or future taxes, duties,
levies, imposts, deductions, charges or withholdings, and all liabilities with
respect thereto, excluding, in the case of each Lender and the Agent,
taxes imposed on its income, and franchise taxes imposed on it by the
jurisdiction under the laws of which such Lender (or its Applicable Lending
Office) or the Agent (as the case may be) is organized or any political
subdivision thereof (all such non-excluded taxes, duties, levies, imposts,
deductions, charges, withholdings, and liabilities being hereinafter referred
to as “Taxes”).  If any Credit
Party shall be required by law to deduct any Taxes from or in respect of any
sum payable under this Credit Agreement or any other Credit Document to any
Lender or the Agent, (i) the sum payable shall be increased as necessary
so that after making all required deductions (including deductions applicable
to additional sums payable under this Section 3.11) such Lender or the
Agent receives an amount equal to the sum it would have received had no such
deductions been made, (ii) such Credit Party shall make such deductions,
(iii) such Credit Party shall pay the full amount deducted to the relevant
taxation authority or other authority in accordance with applicable law, and
(iv) such Credit Party shall furnish to the Agent, at its address referred
to in Section 11.1, the original or a certified copy of a receipt
evidencing payment thereof.

 

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

 

(c)           The
Borrower agrees to indemnify each Lender and the Agent for the full amount of
Taxes and Other Taxes (including, without limitation, any Taxes or Other Taxes
imposed or asserted by any jurisdiction on amounts payable under this
Section 3.11) paid by such Lender or the Agent (as the case may be) and
any liability (including penalties, interest, and expenses) arising therefrom
or with respect thereto.

 

(d)           Each
Lender that is not a United States person under Section 7701(a)(30) of the
Code, on or prior to the date of its execution and delivery of this Credit
Agreement in the case of each Lender listed on the signature pages hereof and
on or prior to the date on which it becomes a Lender in the case of each other
Lender (such Lender constituting a “Foreign Lender”), and from time to
time thereafter if requested in writing by the Borrower or the Agent (but only
so long as such Lender remains lawfully able to do so), shall provide the Borrower
and the Agent with (i) Internal Revenue Service Form W-8 BEN or W-8
ECI, as appropriate, or any successor form prescribed by the Internal Revenue
Service, certifying that such Lender is entitled to benefits under an income
tax treaty to which the United States is a party which reduces to zero the rate
of withholding tax on payments of interest or certifying that the income
receivable pursuant to this Credit Agreement is effectively connected with the
conduct of a trade or business in the United States, (ii) Internal Revenue
Service Form W-8 or W-9, as appropriate, or any successor form prescribed
by the Internal Revenue Service, and/or (iii) any other form or
certificate required by any taxing authority (including any certificate required
by Sections 871(h) and 881(c) of the Internal Revenue Code), certifying
that such Lender is entitled to an exemption from tax on payments pursuant to
this Credit Agreement or any of the other Credit Documents.

 

(e)           For
any period with respect to which a Lender has failed to provide the Borrower
and the Agent with the appropriate form pursuant to Section 3.11(d)
(unless such failure is due to a change in treaty, law, or regulation occurring
subsequent to the date on which a form originally was required to be provided),
such Lender shall not be entitled to indemnification under Section 3.11(a)
or 3.11(b) with respect to Taxes imposed by the United States; provided,
however, that should a Lender, which is otherwise exempt from
withholding tax, become subject to Taxes because of its failure to deliver a
form required hereunder, the Borrower shall take such steps as such Lender
shall reasonably request to assist such Lender to recover such Taxes.

 

32

 

(f)            If
any Credit Party is required to pay additional amounts to or for the account of
any Lender pursuant to this Section 3.11, then such Lender will agree to
use reasonable efforts to change the jurisdiction of its Applicable Lending
Office so as to eliminate or reduce any such additional payment which may
thereafter accrue if such change, in the judgment of such Lender, is not
otherwise disadvantageous to such Lender.

 

(g)           Without
prejudice to the survival of any other agreement of the Credit Parties
hereunder, the agreements and obligations of the Credit Parties contained in
this Section 3.11 shall survive the repayment of the Loans and other
obligations under the Credit Documents.

 

3.12        Compensation.

 

Upon the request of any
Lender, the Borrower shall pay to such Lender such amount or amounts as shall
be sufficient (in the reasonable opinion of such Lender) to compensate it for
any loss, cost, or expense (excluding loss of anticipated profits) incurred by
it as a result of:

 

(a)           any
payment, prepayment, or Conversion of a Eurodollar Loan for any reason
(including, without limitation, the acceleration of the Loans pursuant to
Section 9.2) 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 condition precedent specified in Section 5 to be satisfied)
to borrow, Convert, Continue, or prepay a Eurodollar Loan on the date for such
borrowing, Conversion, Continuation, or prepayment specified in the relevant
notice of borrowing, prepayment, Continuation, or Conversion under this Credit
Agreement.

 

With respect to
Eurodollar Loans, such indemnification may include an amount equal to the
excess, if any, of (a) the amount of interest which would have accrued on
the amount so prepaid, or not so borrowed, Converted or Continued, for the
period from the date of such prepayment or of such failure to borrow, Convert
or Continue to the last day of the applicable Interest Period (or, in the case
of a failure to borrow, Convert or Continue, the Interest Period that would
have commenced on the date of such failure) in each case at the applicable rate
of interest for such Eurodollar Loans provided for herein over (b) the
amount of interest (as reasonably determined by such Lender) which would have
accrued to such Lender on such amount by placing such amount on deposit for a
comparable period with leading banks in the interbank Eurodollar market.  The covenants of the Borrower set forth in
this Section 3.12 shall survive the repayment of the Loans and other
obligations under the Credit Documents.

 

3.13        Pro Rata Treatment.

 

Except to the
extent otherwise provided herein and subject to the terms of the Intercreditor
Agreement, each Loan, each payment or (subject to the terms of
Section 3.3) prepayment of principal of any Loan, each payment of interest
on the Loans and each conversion or extension of any Loan, shall be allocated
pro rata among the Lenders in accordance with the respective principal amounts
of their outstanding Loans of the applicable Type and Participation Interests
in Loans of the applicable Type.

 

3.14        Sharing of Payments.

 

The Lenders agree
among themselves that, in the event that any Lender shall obtain payment in
respect of any Loan or any other obligation owing to such Lender under this
Credit Agreement through the exercise of a right of setoff, banker’s lien or
counterclaim, or pursuant to a secured claim under Section 506 of
Title 11 of the United States Code or other security or interest arising
from, or in lieu of, such secured claim, received by such Lender under any
applicable bankruptcy, insolvency or other similar law or otherwise, or by any
other means, in excess of its pro rata share of such payment as provided for in
this Credit Agreement, such Lender (and the other Lenders) shall adhere to the
provisions of the Intercreditor Agreement with respect to such payment and any
rescission or restoration thereof.  The
Borrower agrees that any Lender purchasing such a Participation Interest
hereunder as a result of any such payments may, to the fullest extent permitted
by law, exercise all rights of payment, including setoff, banker’s lien or
counterclaim, with respect to such Participation Interest as fully as if such
Lender were a holder of such Loan or other obligation in the amount of such

 

33

 

Participation
Interest.  Except as otherwise expressly
provided in this Credit Agreement, if any Lender shall fail to remit to the
Collateral Agent, Agent or any other Lender an amount payable by such Lender to
the Agent or such other Lender pursuant to this Credit Agreement on the date
when such amount is due, such payments shall be made by such Lender together
with interest thereon for each date from the date such amount is due until the
date such amount is paid to the Collateral Agent, Agent or such other Lender at
a rate per annum equal to the Federal Funds Rate.  If under any applicable bankruptcy, insolvency or other similar
law, any Lender receives a secured claim in lieu of a setoff to which this
Section 3.14 applies, such Lender shall, to the extent practicable,
exercise its rights in respect of such secured claim in a manner consistent
with the rights of the Lenders under this Section 3.14 and the Secured
Parties under the Credit Agreement to share in the benefits of any recovery on
such secured claim.

 

3.15        Payments, Computations, Etc.

 

(a)           Generally.  Notwithstanding anything to the contrary
contained herein, all payments made by any Credit Party hereunder shall be paid
to the Collateral Agent for allocation in accordance with the Intercreditor
Agreement.  Except as otherwise
specifically provided herein, all payments hereunder shall be made to the
Collateral Agent (for the benefit of the Agent and Lenders) in Dollars in immediately
available funds, without setoff, deduction, counterclaim or withholding of any
kind, at the Collateral Agent’s office specified in the Intercreditor Agreement
not later than 2:00 P.M. (Charlotte, North Carolina time) on the date when
due.  Payments received after such time
shall be deemed to have been received on the next succeeding Business Day.  The Agent may (but shall not be obligated
to) debit the amount of any such payment which is not made by such time to any
ordinary deposit account of the Borrower or any other Credit Party maintained
with the Agent (with notice to the Borrower or such other Credit Party).  The Agent shall distribute payments received
from the Collateral Agent under the Intercreditor Agreement in accordance with
the terms of the Intercreditor Agreement. 
The Agent will distribute such payments to the Lenders entitled thereto,
if any such payment is received prior to 2:00 P.M.  (Charlotte, North Carolina time) on a
Business Day in like funds as received prior to the end of such Business Day
and otherwise the Agent will distribute such payment to such Lenders on the
next succeeding Business Day.  Whenever
any payment hereunder shall be stated to be due on a day which is not a
Business Day, the due date thereof shall be extended to the next succeeding
Business Day (subject to accrual of interest and Fees for the period of such
extension), except that in the case of Eurodollar Loans, if the extension would
cause the payment to be made in the next following calendar month, then such
payment shall instead be made on the next preceding Business Day.  Except as expressly provided otherwise
herein, all computations of interest and fees shall be made on the basis of
actual number of days elapsed over a year of 360 days.  Interest shall accrue from and include the
date of borrowing, but exclude the date of payment.

 

(b)           Allocation
of Payments After Event of Default. 
After the occurrence and during the continuance of an Event of Default,
all amounts collected or received by the Agent or any Lender on account of the
Credit Party Obligations shall continue to be paid to the Collateral Agent and
all payments received by Agent from the Collateral Agent during such periods
shall continue to be paid over or delivered in accordance with the Intercreditor
Agreement; provided that, if the Intercreditor Agreement has been
terminated, such amounts shall be applied by the Agent in the following order:

 

FIRST, to the payment of all reasonable out-of-pocket
costs and expenses (including without limitation reasonable attorneys’ fees) of
the Agent in connection with enforcing the rights of the Lenders under the
Credit Documents;

 

SECOND, to payment of any fees owed to the Agent;

 

THIRD, to the payment of all of the Credit Party
Obligations consisting of accrued fees and interest;

 

FOURTH, to the payment of the outstanding principal
amount of the Credit Party Obligations;

 

FIFTH, to the payment of all reasonable out-of-pocket
costs and expenses (including without limitation, reasonable attorneys’ fees)
of each of the Lenders in connection with enforcing its rights

 

34

 

under the Credit
Documents or otherwise with respect to the Credit Party Obligations owing to
such Lender;

 

SIXTH, to all other Credit Party Obligations and other
obligations which shall have become due and payable under the Credit Documents
or otherwise and not repaid pursuant to clauses ”FIRST” through “FIFTH”
above; and

 

SEVENTH, to the payment of the surplus, if any, to
whomever may be lawfully entitled to receive such surplus.

 

In carrying out
the foregoing, amounts received shall be applied in the numerical order
provided until exhausted prior to application to the next succeeding
category.  In allocating payments
received from the Collateral Agent (or, in the event the Intercreditor
Agreement is terminated, the Credit Parties), the Agent shall pay to each of
the Lenders an amount equal to such Lender’s pro rata share of the total amount
of the applicable obligations with respect to which such payment is made.

 

3.16        Evidence of Debt.

 

(a)           Each
Lender shall maintain an account or accounts evidencing each Loan made by such
Lender to the Borrower from time to time, including the amounts of principal
and interest payable and paid to such Lender from time to time under this
Credit Agreement.  Each Lender will make
reasonable efforts to maintain the accuracy of its account or accounts and to
promptly update its account or accounts from time to time, as necessary.

 

(b)           The
Agent shall maintain the Register pursuant to Section 11.3(c), and a
subaccount for each Lender, in which Register and subaccounts (taken together)
shall be recorded (i) the amount, type and Interest Period of each such
Loan hereunder, (ii) the amount of any principal or interest due and
payable or to become due and payable to each Lender hereunder and
(iii) the amount of any sum received by the Agent hereunder from or for
the account of any Credit Party and each Lender’s share thereof.  The Agent will make reasonable efforts to
maintain the accuracy of the subaccounts referred to in the preceding sentence
and to promptly update such subaccounts from time to time, as necessary.

 

(c)           The
entries made in the accounts, Register and subaccounts maintained pursuant to
clause (b) of this Section 3.16 (and, if consistent with the entries
of the Agent, clause (a)) shall be prima facie evidence of the existence
and amounts of the obligations of the Credit Parties therein recorded; provided,
however, that the failure of any Lender or the Agent to maintain any
such account, such Register or such subaccount, as applicable, or any error
therein, shall not in any manner affect the obligation of the Credit Parties to
repay the Credit Party Obligations owing to such Lender.

 

3.17        Usury.

 

In
no event shall the amount of interest due or payable on the Loans or other
obligations evidenced hereby or under the other Credit Documents 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 Party, then such excess sum
shall be credited as a payment of principal, unless the Borrower shall notify
the respective Lender Party 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
Lender Parties 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.

 

3.18        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 Credit Agreement is and
shall be the interest specifically described in Section 2.1(d).  Notwithstanding the foregoing, the parties
hereto further agree and stipulate that all agency fees, syndication fees,
facility 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 Party to third parties
or

 

35

 

for
damages incurred by the Agent or any Lender Party, are charges made to
compensate the Agent or any such Lender Party for underwriting or
administrative services and costs or losses performed or incurred, and to be
performed or incurred, by the Agent and the Lender Parties in connection with
this Credit Agreement and shall under no circumstances be deemed to be charges for
the use of money.  Except as expressly
agreed otherwise in writing, all charges other than charges for the use of
money shall be fully earned and nonrefundable when due.

 

3.19        Statements of Account.

 

The
Agent will account to the Borrower monthly with a statement of Loans, accrued
interest and Fees, charges and payments made pursuant to this Credit Agreement
and the other Credit Documents, and such account rendered by the Agent shall be
prima facie evidence of the amounts and other matters set forth therein.  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.

 

3.20        Defaulting Lenders.

 

(a)           Generally.  If for any reason any Lender Party at any
time becomes a Defaulting Lender, then, in addition to the rights and remedies
that may be available to the Agent or the Borrower under this Credit Agreement
or Applicable Law, such Defaulting Lender’s right to participate in the
administration of the Loans, this Credit Agreement and the other Credit
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 Required Lenders or the Required Term Loan
Lenders, shall be suspended during the pendency of such failure or
refusal.  Upon a Lender Party becoming a
Defaulting Lender, the Agent shall give prompt notice to each other Lender
thereof.  If a Lender Party 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 Credit Agreement or any other Credit 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 of Defaulting Lender’s
Loans.  Any Lender Party 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 outstanding Loans.  Any Lender Party desiring to exercise such
right shall give written notice thereof to the Agent no sooner than
two (2) Business Days and not later than ten (10) Business Days after
such Defaulting Lender became a Defaulting Lender.  If more than one Lender Party exercises such right, each such
Lender Party shall have the right to acquire an amount of such Defaulting
Lender’s outstanding Loans in proportion to the outstanding Loans of the other
Lender Parties exercising such right. 
If after such 10th Business Day, the Lender Parties have not elected to
purchase all of the outstanding Loans of such Defaulting Lender, then any
Eligible Assignee may purchase such outstanding Loans.  None of the Agent, the Sole Lead Arranger or
any of the Lender Parties shall have any obligation whatsoever to initiate any
such replacement or to assist in finding an Eligible Assignee.  Upon any such purchase, the Defaulting
Lender’s interest in the Loans and its rights hereunder (but not its liability
in respect thereof or under the Credit Documents or this Credit 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 thereof, including an appropriate
Assignment and Assumption Agreement and, notwithstanding Section 11.3,
shall pay to the Agent an assignment fee in the amount of $5,000.  The purchase price for the outstanding Loans
of a Defaulting Lender shall be equal to the amount of the principal balance of
such 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

 

36

 

under
the Credit 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 Party 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.  If, prior to a
Lender Party’s acquisition of a Defaulting Lender’s outstanding Loans pursuant
to this subsection, such Defaulting Lender shall cure the event or condition
which caused it to become a Defaulting Lender and shall have paid all amounts
owing by it hereunder as a result thereof, then such Lender Party shall no
longer have the right to acquire such Defaulting Lender’s outstanding Loans.

 

3.21        Assumptions
Concerning Funding of Eurodollar Loans.

 

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

 

3.22        Release of HCI.

 

Notwithstanding anything contained herein to the contrary, the Agent
shall release HCI as a Borrower and Credit Party hereunder and under each of
the Credit Documents, (a) upon receipt by the Agent of a request for release of
HCI from the Borrower and all supporting documentation, materials and
information required by Agent in connection therewith; (b) upon receipt by
Agent of evidence (satisfactory to Agent in its reasonable discretion) that all
Property owned by HCI has been transferred to JV1, that HCI has been or will
be, immediately upon receipt of an acknowledgement of release by Agent, merged
into JV1 or otherwise dissolved in a manner acceptable to the Agent, in its
reasonable discretion and that the entities that were formerly Wholly Owned
Subsidiaries of HCI are or will be, immediately upon receipt of an
acknowledgement of release by Agent, Wholly Owned Subsidiaries of JV1 and
Credit Parties hereunder and (c) to the extent no Default or Event of Default
exists as of the date of such requested release or is otherwise likely to occur
as a result of the granting of such release. 
Upon satisfaction of the above-noted conditions, Agent shall deliver to
Borrower written confirmation of the release of HCI as a Borrower and Credit
Party hereunder and under the other Credit Documents.  All references contained herein to HCI and all portions of any representations,
warranties and covenants contained in any Credit Document and directly related
to HCI or its ownership structure (but not portions of such representation,
warranties and covenants related, in any manner, to any other Credit Party or
Person) shall, immediately upon the delivery by Agent to the Borrower of the
written confirmation of release pursuant to this Section 3.22, be deemed to be
deleted from such Credit Documents and to be of no further force or effect;
provided, however, that Borrower’s delivery of a request for release with
respect to HCI shall be deemed to be an ongoing representation, warranty and
covenant that HCI has been or will be, immediately upon the receipt of Agent’s
confirmation of release, merged into JV1 or otherwise dissolved in the manner
shown in the materials and information provided to Agent in connection
therewith and an ongoing representation and warranty that such materials and
information are true and correct in all material respects.  Each of the Lenders hereby consents to the
release of HCI upon the terms and conditions set forth in this Section 3.22.

 

ARTICLE IV

GUARANTY

 

4.1          The Guaranty.

 

Each of the
Guarantors hereby jointly and severally guarantees to each Lender, each
Affiliate of a Lender that enters into a Hedging Agreement, and the Agent as
hereinafter provided, as primary obligor and not as surety, the prompt payment
of the Credit Party Obligations in full when due (whether at stated maturity,
as a mandatory prepayment, by acceleration, as a mandatory cash
collateralization or otherwise) strictly in accordance with the terms
thereof.  The Guarantors hereby further
agree that if any of the Credit Party Obligations are not paid in full when due
(whether at stated maturity, as a mandatory prepayment, by acceleration, as a
mandatory cash collateralization or otherwise), the Guarantors will, jointly
and severally, promptly pay the same, without any demand or notice whatsoever,
and that in the

 

37

 

case of any extension of time of payment or renewal of any of the
Credit Party Obligations, the same will be promptly paid in full when due
(whether at extended maturity, as a mandatory prepayment, by acceleration, as a
mandatory cash collateralization or otherwise) in accordance with the terms of
such extension or renewal.

 

Notwithstanding
any provision to the contrary contained herein or in any other of the Credit
Documents or Hedging Agreements, the obligations of each Guarantor under this
Credit Agreement and the other Credit Documents shall be limited to an
aggregate amount equal to the largest amount that would not render such
obligations subject to avoidance under Section 548 of the Bankruptcy Code
or any comparable provisions of any applicable state law.

 

4.2          Obligations Unconditional.

 

The obligations of
the Guarantors under Section 4.1 are joint and several, absolute and
unconditional, irrespective of the value, genuineness, validity, regularity or
enforceability of any of the Credit Documents or Hedging Agreements, or any
other agreement or instrument referred to therein, or any substitution,
release, impairment or exchange of any other guarantee of or security for any
of the Credit Party Obligations, and, to the fullest extent permitted by
applicable law, irrespective of any other circumstance whatsoever which might
otherwise constitute a legal or equitable discharge or defense of a surety or
guarantor, it being the intent of this Section 4.2 that the obligations of
the Guarantors hereunder shall be absolute and unconditional under any and all
circumstances.  Each Guarantor agrees
that such Guarantor shall have no right of subrogation, indemnity,
reimbursement or contribution against the Borrower or any other Guarantor for
amounts paid under this Section 4 until such time as the Credit Party
Obligations have been Fully Satisfied. 
Without limiting the generality of the foregoing, it is agreed that, to
the fullest extent permitted by law, the occurrence of any one or more of the
following shall not alter or impair the liability of any Guarantor hereunder
which shall remain absolute and unconditional as described above:

 

(a)           at
any time or from time to time, without notice to any Guarantor, the time for
any performance of or compliance with any of the Credit Party Obligations shall
be extended, or such performance or compliance shall be waived;

 

(b)           any
of the acts mentioned in any of the provisions of any of the Credit Documents,
any Hedging Agreement between any Consolidated Party and any Lender, or any
Affiliate of a Lender, or any other agreement or instrument referred to in the
Credit Documents or such Hedging Agreements shall be done or omitted;

 

(c)           the
maturity of any of the Credit Party Obligations shall be accelerated, or any of
the Credit Party Obligations shall be modified, supplemented or amended in any
respect, or any right under any of the Credit Documents, any Hedging Agreement
between any Consolidated Party and any Lender, or any Affiliate of a Lender, or
any other agreement or instrument referred to in the Credit Documents or such
Hedging Agreements shall be waived or any other guarantee of any of the Credit
Party Obligations or any security therefor shall be released, impaired or
exchanged in whole or in part or otherwise dealt with;

 

(d)           any
Lien granted to, or in favor of, the Agent or any Lender or Lenders as security
for any of the Credit Party Obligations shall fail to attach or be perfected;
or

 

(e)           any
of the Credit Party Obligations shall be determined to be void or voidable
(including, without limitation, for the benefit of any creditor of any
Guarantor) or shall be subordinated to the claims of any Person (including,
without limitation, any creditor of any Guarantor).

 

With respect to
its obligations hereunder, each Guarantor hereby expressly waives diligence,
presentment, demand of payment, protest and all notices whatsoever, and any
requirement that the Agent or any Lender exhaust any right, power or remedy or
proceed against any Person under any of the Credit Documents, any Hedging
Agreement between any Consolidated Party and any Lender, or any Affiliate of a
Lender, or any other agreement or instrument referred to in the Credit
Documents or such Hedging Agreements, or against any other Person under any
other guarantee of, or security for, any of the Credit Party Obligations.

 

38

 

4.3          Reinstatement.

 

The obligations of
the Guarantors under this Section 4 shall be automatically reinstated if
and to the extent that for any reason any payment by or on behalf of any Person
in respect of the Credit Party Obligations is rescinded or must be otherwise
restored by any holder of any of the Credit Party Obligations, whether as a
result of any proceedings in bankruptcy or reorganization or otherwise, and each
Guarantor agrees that it will indemnify the Agent and each Lender on demand for
all reasonable costs and expenses (including, without limitation, fees and
expenses of counsel) incurred by the Agent or such Lender in connection with
such rescission or restoration, including any such costs and expenses incurred
in defending against any claim alleging that such payment constituted a
preference, fraudulent transfer or similar payment under any bankruptcy,
insolvency or similar law.

 

4.4          Certain Additional Waivers.

 

Without limiting
the generality of the provisions of this Section 4, each Guarantor hereby
specifically waives the benefits of N.C. 
Gen.  Stat.  §§ 26-7 through 26-9, inclusive, to the
extent applicable.  Each Guarantor
further agrees that such Guarantor shall have no right of recourse to security
for the Credit Party Obligations, except through the exercise of rights of
subrogation pursuant to Section 4.2 and through the exercise of rights of
contribution pursuant to Section 4.6.

 

4.5          Remedies.

 

The Guarantors
agree that, to the fullest extent permitted by law, as between the Guarantors,
on the one hand, and the Agent and the Lenders, on the other hand, the Credit
Party Obligations may be declared to be forthwith due and payable as provided
in Section 9.2 (and shall be deemed to have become automatically due and
payable in the circumstances provided in said Section 9.2) for purposes of
Section 4.1 notwithstanding any stay, injunction or other prohibition
preventing such declaration (or preventing the Credit Party Obligations from
becoming automatically due and payable) as against any other Person and that,
in the event of such declaration (or the Credit Party Obligations being deemed
to have become automatically due and payable), the Credit Party Obligations
(whether or not due and payable by any other Person) shall forthwith become due
and payable by the Guarantors for purposes of Section 4.1.

 

4.6          Rights of Contribution.

 

The Guarantors
hereby agree as among themselves that, if any Guarantor shall make an Excess
Payment (as defined below), such Guarantor shall have a right of contribution
from each other Guarantor in an amount equal to such other Guarantor’s
Contribution Share (as defined below) of such Excess Payment.  The payment obligations of any Guarantor
under this Section 4.6 shall be subordinate and subject in right of
payment to the Credit Party Obligations until such time as the Credit Party
Obligations have been Fully Satisfied, and none of the Guarantors shall
exercise any right or remedy under this Section 4.6 against any other
Guarantor until such Credit Party Obligations have been Fully Satisfied.  For purposes of this Section 4.6,
(a) ”Excess Payment” shall mean the amount paid by any Guarantor in
excess of its Pro Rata Share of any Guaranteed Obligations; (b) ”Pro
Rata Share” shall mean, for any Guarantor in respect of any payment of
Credit Party Obligations, the ratio (expressed as a percentage) as of the date
of such payment of Guaranteed Obligations of (i) the amount by which the
aggregate present fair salable value of all of its assets and properties
exceeds the amount of all debts and liabilities of such Guarantor (including
contingent, subordinated, unmatured, and unliquidated liabilities, but
excluding the obligations of such Guarantor hereunder) to (ii) the amount
by which the aggregate present fair salable value of all assets and other
properties of all of the Credit Parties exceeds the amount of all of the debts
and liabilities (including contingent, subordinated, unmatured, and
unliquidated liabilities, but excluding the Credit Party Obligations) of the
Credit Parties; provided, however, that, for purposes of
calculating the Pro Rata Shares of the Guarantors in respect of any payment of
Credit Party Obligations, any Guarantor that became a Guarantor subsequent to
the date of any such payment shall be deemed to have been a Guarantor on the
date of such payment and the financial information for such Guarantor as of the
date such Guarantor became a Guarantor shall be utilized for such Guarantor in
connection with such payment; and (c) ”Contribution Share” shall
mean, for any Guarantor in respect of any Excess Payment made by any other
Guarantor, the ratio (expressed as a percentage) as of the date of such Excess
Payment of (i) the amount by which the aggregate present fair salable
value of all of its assets and properties exceeds the amount of all debts and
liabilities of such Guarantor (including contingent, subordinated, unmatured,
and unliquidated liabilities, but excluding the obligations of such Guarantor
hereunder) to (ii) the amount by which the aggregate present fair salable
value of all assets and other properties of the Credit Parties other than the
maker

 

39

 

of such Excess Payment exceeds the amount of all of the debts and
liabilities (including contingent, subordinated, unmatured, and unliquidated
liabilities, but excluding the Credit Party Obligations) of the Credit Parties
other than the maker of such Excess Payment; provided, however,
that, for purposes of calculating the Contribution Shares of the Guarantors in
respect of any Excess Payment, any Guarantor that became a Guarantor subsequent
to the date of any such Excess Payment shall be deemed to have been a Guarantor
on the date of such Excess Payment and the financial information for such
Guarantor as of the date such Guarantor became a Guarantor shall be utilized
for such Guarantor in connection with such Excess Payment.  This Section 4.6 shall not be deemed to
affect any right of subrogation, indemnity, reimbursement or contribution that
any Guarantor may have under applicable law against the Borrower in respect of
any payment of Guaranteed Obligations. 
Notwithstanding the foregoing, all rights of contribution against any
Guarantor shall terminate from and after such time, if ever, that such
Guarantor shall be relieved of its obligations pursuant to Section 8.5(a).

 

4.7          Guarantee of Payment; Continuing
Guarantee.

 

The guarantee in
this Section 4 is a guaranty of payment and not of collection, is a
continuing guarantee, and shall apply to all Credit Party Obligations whenever
arising.

 

ARTICLE V

CONDITIONS

 

5.1          Closing Conditions.

 

The obligation of the Agent and Lenders to enter
into this Agreement and to make the Advance under the Term Loans shall be
subject to satisfaction of the following conditions (in form and substance
reasonably acceptable to the Agent) as of the Closing Date:

 

(a)           Executed
Credit Documents.  Receipt by the
Agent of duly executed copies of: 
(i) this Credit Agreement, (ii) the Notes, (iii) Security
Documents, (iv) the Intercreditor Agreement and (v) all other Credit Documents.

 

(b)           Corporate
Documents.  Receipt by the Agent of
the following:

 

(i)          Charter Documents.  Copies of the articles or certificates of
incorporation or other charter documents of each Credit Party certified to be
true and complete as of a recent date by the appropriate Governmental Authority
of the state or other jurisdiction of its incorporation and certified by a
secretary or assistant secretary of such Credit Party to be true and correct as
of the Closing Date.

 

(ii)         Bylaws.  A copy of the bylaws of each Credit Party
certified by a secretary or assistant secretary of such Credit Party to be true
and correct as of the Closing Date.

 

(iii)        Resolutions.  Copies of resolutions of the Board of
Directors of each Credit Party approving and adopting the Credit Documents to
which it is a party, the transactions contemplated therein and authorizing
execution and delivery thereof, certified by a secretary or assistant secretary
of such Credit Party to be true and correct and in force and effect as of the
Closing Date.

 

(iv)        Good Standing.  Copies of (A) certificates of good
standing, existence or its equivalent with respect to each Credit Party
certified as of a recent date by the appropriate Governmental Authorities of
the state or other jurisdiction of incorporation and each other jurisdiction in
which the failure to so qualify and be in good standing could have a Material
Adverse Effect and (B) to the extent available, a certificate indicating
payment of all corporate or comparable franchise taxes certified as of a recent
date by the appropriate governmental taxing authorities.

 

40

 

(v)         Incumbency.  An incumbency certificate of each Credit
Party certified by a secretary or assistant secretary to be true and correct as
of the Closing Date.

 

(vi)        REIT Status.  Evidence, satisfactory to the Agent, that
the USRP REIT qualifies as a REIT, that each of its Subsidiaries that are
corporations are Qualified REIT Subsidiaries and that the execution and
performance by the Credit Parties under the Credit Documents shall not affect
such status.

 

(vii)       Bankruptcy Remote Borrowing Entity
Status.  Evidence, satisfactory to
the Agent, that the General SPE qualifies as a Bankruptcy Remote Borrowing
Entity and that the execution and performance by the Credit Parties under the
Credit Documents shall not affect such status.

 

(c)           Opinions of Counsel.  The Agent shall have received, in each case
dated as of the Closing Date and in form and substance reasonably satisfactory
to the Agent:

 

(i)          a legal opinion of Richard Wilensky,
general counsel for the Credit Parties; and

 

(ii)         a legal opinion of special local
counsel for each Credit Party not organized in the State of Delaware.

 

(d)           Officer’s Certificates.  The Agent shall have received a certificate
or certificates executed by an Executive Officer of the Borrower as of the
Closing Date, in form and substance satisfactory to the Agent, stating that
(A) each Credit Party is in compliance with all existing financial
obligations, (B) all governmental, shareholder and third party consents
and approvals, if any, with respect to the Credit Documents and the transactions
contemplated thereby have been obtained, (C) no action, suit,
investigation or proceeding is pending or threatened in any court or before any
arbitrator or governmental instrumentality that purports to affect any Credit
Party or any transaction contemplated by the Credit Documents, if such action,
suit, investigation or proceeding could have a Material Adverse Effect, and
(D) immediately after giving effect to the Transaction, (1) no
Default or Event of Default exists, (2) all representations and warranties
contained herein and in the other Credit Documents are true and correct in all
material respects and (3) on the basis of income statement items and
capital expenditures for the 12-month period ending on the last day of the most
recently ended calendar month prior to the Closing Date and balance sheet items
as of the Closing Date after giving effect to the Credit Documents, the Credit
Parties are in pro forma compliance with each of the Financial Covenants.

 

(e)           Solvency Certificate.  The Agent shall have received a certificate
executed by an Executive Officer of the Borrower as of the Closing Date, in
form and substance satisfactory to the Agent, regarding the Solvency of each of
the Credit Parties.

 

(f)            Fees and Expenses.  Payment by the Credit Parties to the Lenders
and the Agent of all fees and expenses relating to the Credit Facility which
are due and payable on the Closing Date, including, without limitation, the
payment by Borrower to the Agent and BAS those fees specified in the Fee Letter
and all fees and expenses of Moore & Van Allen, PLLC whether reflected on
previously issued invoices or an invoice to be delivered at closing.

 

(g)           Current and Pro Forma Financial
Statements.  Receipt by the Agent
and the Lenders of (i) the consolidated financial statements of the
Consolidated Parties, including balance sheets and income and cash flow
statements for the fiscal quarter ended September 30, 2003; (ii) pro forma
covenant calculations with respect to each of the Financial Covenants, showing
compliance with such covenants as of the Closing Date; (iii) detailed
projections of financial statements for the Consolidated Parties and of
calculations with respect to each of the Financial Covenants, in each case, for
the three year period following the most recently completed fiscal quarter of
the Consolidated Parties; and (iv) such other information relating to the
Consolidated Parties as the Agent may reasonably require.

 

(h)           Opening Borrowing Base Certificate
and Delinquency Report.  Receipt by
the Agent of a Borrowing Base Certificate containing the Borrower’s most
recently collected information with respect to

 

41

 

the Borrowing Base Assets
(but, in any event, with respect to information that is not more than 45 days
old as of the Closing Date), substantially in the form of Exhibit 7.1(d)
and certified by an Executive Officer of the Borrower to be true and correct
and a Delinquency Report dated as of the Closing Date and certified by an
Executive Officer of the Borrower to be true and correct as of the Closing
Date.  

 

(i)            Evidence of Termination.
Evidence, acceptable to the Agent in its reasonable discretion, indicating that
the Replaced Credit Agreement has been terminated as of the Closing Date.

 

(j)            Other.  Receipt by the Lenders of such other
documents, instruments, agreements or information as reasonably requested by
any Lender, including, but not limited to, information regarding litigation,
tax, accounting, labor, insurance, pension liabilities (actual or contingent),
real estate leases, material contracts, debt agreements, property ownership and
contingent liabilities of the Consolidated Parties.

 

5.2          Conditions to all Extensions of
Credit.

 

The obligations of
each Lender to continue or convert any portion of the Loans are subject to
satisfaction of the following conditions in addition to satisfaction on the
Closing Date of the conditions set forth in Section 5.1:

 

(a)           The Borrower shall have delivered an
appropriate Notice of Continuation or Notice of Conversion;

 

(b)           The representations and warranties
set forth in Section 6 shall, subject to the limitations set forth
therein, be true and correct in all material respects as of such date (except
for those which expressly relate to an earlier date);

 

(c)           There shall not have been commenced
against any Consolidated Party an involuntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, or any
case, proceeding or other action for the appointment of a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or similar official) of such Person
or for any substantial part of its Property or for the winding up or
liquidation of its affairs, and such involuntary case or other case, proceeding
or other action shall remain undismissed;

 

(d)           No Default or Event of Default shall
exist and be continuing either prior to or after giving effect thereto; and

 

(e)           The Outstanding Amount shall not, as
of such date, exceed the Maximum Loan Amount and the sum of the Outstanding
Amount plus the Revolver Obligations shall not, as of such date, exceed
the Borrowing Base.

 

The delivery of
each Notice of Continuation or Notice of Conversion pursuant to the terms of
this Credit Agreement shall constitute a representation and warranty by the Credit
Parties of the correctness of the matters specified in subsections (b),
(c) and (d) above.

 

ARTICLE VI

REPRESENTATIONS AND WARRANTIES

 

The Credit Parties
hereby represent to the Agent and each Lender that:

 

6.1          Financial Condition.

 

(a)           The audited consolidated balance
sheets and income statements of the Consolidated Parties for the fiscal years
ended December 31, 1999, December 31, 2000, December 31,
2001 and December 31, 2002 (including the notes thereto) (i) have been audited
by Deloitte & Touche, (ii) have been prepared in accordance with GAAP
consistently applied throughout the periods covered thereby and
(iii) present fairly (on the basis

 

42

 

disclosed in the
footnotes to such financial statements) the consolidated financial condition,
results of operations and cash flows of the Consolidated Parties as of such
date and for such periods.  The
unaudited interim balance sheets of the Consolidated Parties as at the end of,
and the related unaudited interim statements of earnings and of cash flows for,
each fiscal month and quarterly period ended after December 31, 2002
and prior to the Closing Date (i) have been prepared in accordance with
GAAP consistently applied throughout the periods covered thereby and
(ii) present fairly (on the basis disclosed in the footnotes to such
financial statements) the consolidated financial condition, results of
operations and cash flows of the Consolidated Parties as of such date and for
such periods.  During the period from
December 31, 2002 to and including the Closing Date, there has been no sale,
transfer or other disposition by any Consolidated Party of any material part of
the business or property of the Consolidated Parties, taken as a whole, and no
purchase or other acquisition by any of them of any business or property
(including any Capital Stock of any other Person) material in relation to the
consolidated financial condition of the Consolidated Parties, taken as a whole,
in each case, which is not reflected in the foregoing financial statements or
in the notes thereto and has not otherwise been disclosed in writing to the
Lenders on or prior to the Closing Date. 
As of the Closing Date, the Borrower and its Subsidiaries have no
material liabilities (contingent or otherwise) that are not reflected in the
foregoing financial statements or in the notes thereto.

 

(b)           The financial statements and other
information delivered pursuant to Section 5.1(g) have been prepared in
accordance with GAAP (except as may otherwise be permitted under
Section 1.3) and present fairly (on the basis disclosed in the footnotes
to such financial statements) the consolidated financial condition, results of
operations and cash flows of the General Partner and the Consolidated Parties
as of such date and for such periods.

 

6.2          No Material Change.

 

Since December 31,
2002, there has been no development or event relating to or affecting a
Consolidated Party which has had or could have a Material Adverse Effect.

 

6.3          Organization and Good Standing.

 

Each of the
Consolidated Parties (a) is duly organized, validly existing and is in
good standing under the laws of the jurisdiction of its incorporation or
organization, (b) has the corporate or other necessary power and
authority, and the legal right, to own and operate its property, to lease the
property it operates as lessee and to conduct the business in which it is
currently engaged and (c) is duly qualified as a foreign entity and in
good standing under the laws of each jurisdiction where its ownership, lease or
operation of property or the conduct of its business requires such
qualification, other than in such jurisdictions where the failure to be so
qualified and in good standing would not have a Material Adverse Effect.

 

6.4          Power; Authorization; Enforceable
Obligations.

 

Each of the Credit
Parties has the corporate or other necessary power and authority, and the legal
right, to make, deliver and perform the Credit Documents to which it is a
party, and in the case of the Borrower, to obtain extensions of credit
hereunder, and has taken all necessary corporate or other necessary action to
authorize the borrowings and other extensions of credit on the terms and
conditions of this Credit Agreement and to authorize the execution, delivery
and performance of the Credit Documents to which it is a party.  No consent or authorization of, filing with,
notice to or other similar act by or in respect of, any Governmental Authority
or any other Person is required to be obtained or made by or on behalf of any Credit
Party in connection with the borrowings or other extensions of credit hereunder
or with the execution, delivery, performance, validity or enforceability of the
Credit Documents to which such Credit Party is a party, except
for consents, authorizations, notices and filings described in Schedule 6.4,
all of which have been obtained or made or have the status described in such Schedule 6.4.  This Credit Agreement has been, and each
other Credit Document to which any Credit Party is a party will be, duly
executed and delivered on behalf of the Credit Parties.  This Credit Agreement constitutes, and each
other Credit Document to which any Credit Party is a party when executed and
delivered will constitute, a legal, valid and binding obligation of such Credit
Party enforceable against such party in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors’ rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).

 

43

 

6.5          No Conflicts.

 

Neither the
execution and delivery of the Credit Documents, nor the consummation of the
transactions contemplated therein, nor performance of and compliance with the
terms and provisions thereof by such Credit Party will (a) violate or
conflict with any provision of its articles or certificate of incorporation or
bylaws or other organizational or governing documents of such Person,
(b) violate, contravene or materially conflict with any Requirement of Law
or any other law, regulation (including, without limitation, Regulation U
or Regulation X), order, writ, judgment, injunction, decree or permit
applicable to it, (c) violate, contravene or conflict with contractual
provisions of, or cause an event of default under, any indenture, loan
agreement, mortgage, deed of trust, contract or other agreement or instrument
to which it is a party or by which it may be bound, the violation of which
could have a Material Adverse Effect, or (d) result in or require the
creation of any Lien (other than those contemplated in or created in connection
with the Credit Documents) upon or with respect to its properties.

 

6.6          No Default.

 

No Consolidated
Party is in default in any respect under any contract, lease, loan agreement,
indenture, mortgage, security agreement or other agreement or obligation to
which it is a party or by which any of its properties is bound which default
could have a Material Adverse Effect. 
No Default or Event of Default has occurred or exists except as
previously disclosed in writing to the Lenders.

 

6.7          Ownership.

 

Each Consolidated
Party is the owner of, and has good and marketable title to, all of its
respective assets and none of such assets is subject to any Lien other than
Permitted Liens and Liens granted in connection with any Term Securitization
specifically contemplated and approved pursuant to the terms hereof.

 

6.8          Indebtedness.

 

Except as
otherwise permitted under Section 8.1, the Consolidated Parties have no
Indebtedness.

 

6.9          Litigation.

 

Except as
disclosed in Schedule 6.9, there does not exist any pending or
threatened action, suit or legal, equitable, arbitration or administrative
proceeding against any Consolidated Party which might have a Material Adverse
Effect.

 

6.10        Taxes.

 

Each Consolidated
Party has filed, or caused to be filed, all material tax returns (Federal,
state, local and foreign) required to be filed and paid (a) all amounts of
taxes shown thereon to be due (including interest and penalties) and
(b) all other taxes, fees, assessments and other governmental charges
(including mortgage recording taxes, documentary stamp taxes and intangibles
taxes) owing by it, except for such taxes (i) which are not yet delinquent
or (ii) that are being contested in good faith and by proper proceedings,
and against which adequate reserves are being maintained in accordance with
GAAP.  No Credit Party is aware of any
proposed federal or state income tax assessments against it or any other
Consolidated Party.  No Credit Party is
aware of any other proposed tax assessments against it or any other
Consolidated Party that could have a Material Adverse Effect.

 

6.11        Compliance with Law.

 

Each Consolidated
Party is in compliance with all Requirements of Law and all other laws, rules,
regulations, orders and decrees (including without limitation Environmental
Laws) applicable to it, or to its properties, unless such failure to comply
could not have a Material Adverse Effect. 
No currently-existing Requirement of Law could cause a Material Adverse
Effect.

 

44

 

6.12        ERISA.

 

Except as
disclosed and described in Schedule 6.12 attached hereto:

 

(a)           During
the five-year period prior to the date on which this representation is made or
deemed made: (i) no ERISA Event has occurred, and, to the best knowledge
of the Executive Officers of the Credit Parties, no event or condition has
occurred or exists as a result of which any ERISA Event could reasonably be
expected to occur, with respect to any Plan; (ii) no “accumulated funding
deficiency,” as such term is defined in Section 302 of ERISA and
Section 412 of the Code, whether or not waived, has occurred with respect
to any Plan; (iii) each Plan has been maintained, operated, and funded in
compliance with its own terms and in material compliance with the provisions of
ERISA, the Code, and any other applicable Federal or state laws; and
(iv) no lien in favor of the PBGC or a Plan has arisen or is reasonably
likely to arise on account of any Plan.

 

(b)           The
actuarial present value of all “benefit liabilities” (as defined in
Section 4001(a)(16) of ERISA), whether or not vested, under each Single
Employer Plan, as of the last annual valuation date prior to the date on which
this representation is made or deemed made (determined, in each case, in
accordance with Financial Accounting Standards Board Statement 87, utilizing
the actuarial assumptions used in such Plan’s most recent actuarial valuation
report), did not exceed as of such valuation date the fair market value of the
assets of such Plan.

 

(c)           Neither
any Consolidated Party nor any ERISA Affiliate has incurred, or, to the best
knowledge of the Executive Officers of the Credit Parties, could be reasonably
expected to incur, any withdrawal liability under ERISA to any Multiemployer
Plan or Multiple Employer Plan.  Neither
any Consolidated Party nor any ERISA Affiliate would become subject to any
withdrawal liability under ERISA if any Consolidated Party or any ERISA
Affiliate were to withdraw completely from all Multiemployer Plans and Multiple
Employer Plans as of the valuation date most closely preceding the date on
which this representation is made or deemed made.  Neither any Consolidated Party nor any ERISA Affiliate has
received any notification that any Multiemployer Plan is in reorganization
(within the meaning of Section 4241 of ERISA), is insolvent (within the
meaning of Section 4245 of ERISA), or has been terminated (within the
meaning of Title IV of ERISA), and no Multiemployer Plan is, to the best
knowledge of the Executive Officers of the Credit Parties, reasonably expected
to be in reorganization, insolvent, or terminated.

 

(d)           No
prohibited transaction (within the meaning of Section 406 of ERISA or
Section 4975 of the Code) or breach of fiduciary responsibility has
occurred with respect to a Plan which has subjected or may subject any
Consolidated Party or any ERISA Affiliate to any liability under
Sections 406, 409, 502(i), or 502(l) of ERISA or Section 4975 of the
Code, or under any agreement or other instrument pursuant to which any
Consolidated Party or any ERISA Affiliate has agreed or is required to
indemnify any Person against any such liability.

 

(e)           Neither
any Consolidated Party nor any ERISA Affiliates has any material liability with
respect to “expected post-retirement benefit obligations” within the meaning of
the Financial Accounting Standards Board Statement 106.  Each Plan which is a welfare plan (as
defined in Section 3(1) of ERISA) to which Sections 601-609 of ERISA
and Section 4980B of the Code apply has been administered in compliance in
all material respects of such sections.

 

(f)            Neither
the execution and delivery of this Credit Agreement nor the consummation of the
financing transactions contemplated thereunder will involve any transaction
which is subject to the prohibitions of Sections 404, 406 or 407 of ERISA
or in connection with which a tax could be imposed pursuant to Section 4975
of the Code.  The representation by the
Credit Parties in the preceding sentence is made in reliance upon and subject
to the accuracy of the Lenders’ representation in Section 11.15 with
respect to their source of funds and is subject, in the event that the source
of the funds used by the Lenders in connection with this transaction is an
insurance company’s general asset account, to the application of Prohibited
Transaction Class Exemption 95-60, 60 Fed. 
Reg.  35,925 (1995), compliance
with the regulations issued under Section 401(c)(1)(A) of ERISA, or the
issuance of any other prohibited transaction exemption or similar relief, to
the effect that assets in an insurance company’s general asset account do not
constitute assets of an

 

45

 

“employee benefit
plan” within the meaning of Section 3(3) of ERISA or a “plan” within the
meaning of Section 4975(e)(1) of the Code.

 

6.13        Corporate Structure; Capital Stock,
etc.

 

The corporate
capital and ownership structure of the Consolidated Parties as of the Closing
Date after giving effect to the Credit Documents executed as of the date hereof
is as described in Schedule 6.13A. 
Set forth on Schedule 6.13B is a complete and accurate list
as of the Closing Date with respect to the Borrower and each of its direct and
indirect Subsidiaries of (i) jurisdiction of incorporation,
(ii) number of shares of each class of Capital Stock outstanding,
(iii) number and percentage of outstanding shares of each class owned
(directly or indirectly) by the Consolidated Parties and (iv) number and
effect, if exercised, of all outstanding options, warrants, rights of
conversion or purchase and all other similar rights with respect thereto as of
the Closing Date (except for employee stock options required to be disclosed in
regularly-filed publicly accessible documents).  The outstanding Capital Stock of all such Persons is validly
issued, fully paid and non-assessable and is owned by the Consolidated Parties,
directly or indirectly, in the manner set forth on Schedule 6.13B,
free and clear of all Liens (other than those arising under or contemplated in
connection with the Credit Documents). 
Other than as set forth in Schedule 6.13B, neither the
Borrower nor any of its Subsidiaries has outstanding any securities convertible
into or exchangeable for its Capital Stock nor does any such Person have
outstanding any rights to subscribe for or to purchase or any options for the
purchase of, or any agreements providing for the issuance (contingent or
otherwise) of, or any calls, commitments or claims of any character relating to
its Capital Stock.  Each of the Domestic
Subsidiaries of the General Partner, the USRP REIT and the Borrower existing as
of the date hereof, except USRP Funding 2001-A, L.P., USRP (SFGP), LLC, USRP
(Hawaii), LLC, USRP (Bob), LLC and Fuel Supply, Inc. are listed as Subsidiary
Guarantors on the signature pages hereto. 
S&C has no Subsidiaries and owns no Capital Stock of any other
Person.  HCI has no Subsidiaries that
are not Credit Parties and owns no Capital Stock of any other Person.  JV1 has no Subsidiaries that are not Credit
Parties and each Subsidiary of JV1 is set forth on Schedule 6.13A
attached hereto.

 

6.14        Governmental Regulations, Etc.

 

(a)           None
of the transactions contemplated by this Credit Agreement (including, without
limitation, the direct or indirect use of the proceeds of the Loans) will
violate or result in a violation of the Securities Act, the Securities Exchange
Act or any of Regulations U and X. 
If requested by any Lender or the Agent, the Borrower will furnish to
the Agent and each Lender a statement, in conformity with the requirements of
FR Form U-1 referred to in Regulation U, that no part of the proceeds
of the Loans will be used, directly or indirectly, for the purpose of “buying”
or “carrying” any “margin stock” within the meaning of Regulations U and X, or
for the purpose of purchasing or carrying or trading in any securities.

 

(b)           None
of the Consolidated Parties is (i) an “investment company”, or a company
“controlled” by “investment company”, within the meaning of the Investment
Company Act of 1940, as amended, (ii) a “holding company” as defined in,
or otherwise subject to regulation under, the Public Utility Holding Company
Act of 1935, as amended or (iii) subject to regulation under any other
Federal or state statute or regulation which limits its ability to incur
Indebtedness.

 

6.15        Purpose of Loans; Termination of
Replaced Credit Agreement.

 

The proceeds of
the Loans hereunder shall be used by the Borrower solely for the purpose of
providing funds for the purchase by JV1 of certain preferred equity interests
in USRP/HCI Partnership 1, L.P. on terms and conditions acceptable to the Agent
in its sole and absolute discretion.  No
proceeds of the Loans shall be used to (y) finance the purchase of “margin
stock” as such term is defined in Regulation U of the Federal Reserve
Board or (z) finance the acquisition of any investments in commercial
mortgage-backed securities. The Replaced Credit Agreement has been or shall be
terminated as of the date hereof.

 

6.16        Environmental Matters.

 

Except as
disclosed and described in Schedule 6.16 attached hereto:

 

46

 

(a)           Each
of the Real Properties and all operations at the Real Properties are in
material compliance with all applicable Environmental Laws, there is no
violation of any Environmental Law with respect to the Real Properties or the
Businesses, and there are no conditions relating to the Real Properties or the
Businesses that could give rise to liability under any applicable Environmental
Laws that could result in a Material Adverse Effect.

 

(b)           None
of the Real Properties contains, or has previously contained, any Materials of
Environmental Concern at, on or under the Real Properties in amounts or
concentrations that could result in a Material Adverse Effect.

 

(c)           No
Consolidated Party has received any written or verbal notice of, or inquiry
from any Governmental Authority regarding, any violation, alleged violation,
non-compliance, liability or potential liability regarding environmental
matters or compliance with Environmental Laws with regard to any of the Real
Properties or the Businesses that could result in a Material Adverse Effect,
nor does any Executive Officer of any Credit Party have knowledge or reason to
believe that any such notice will be received or is being threatened.

 

(d)           Materials
of Environmental Concern have not been transported or disposed of from the Real
Properties, or generated, treated, stored or disposed of at, on or under any of
the Real Properties or any other location, in each case by or on behalf of any
Consolidated Party in a manner that could result in a Material Adverse Effect.

 

(e)           No
judicial proceeding or governmental or administrative action is pending or, to
the best knowledge of the Executive Officers of the Credit Parties, threatened,
under any Environmental Law to which any Consolidated Party is or will be named
as a party, nor are there any consent decrees or other decrees, consent orders,
administrative orders or other orders, or other administrative or judicial
requirements outstanding under any Environmental Law with respect to the
Consolidated Parties, the Real Properties or the Businesses that could result in
a Material Adverse Effect.

 

(f)            There
has been no release, or threat of release, of Materials of Environmental
Concern at or from any of the Real Properties, or arising from or related to
the operations (including, without limitation, disposal) of any Consolidated
Party in connection with the Real Properties or otherwise in connection with
the Businesses in a manner that could result in a Material Adverse Effect.

 

6.17        Intellectual Property.

 

Each Consolidated Party owns, or has the legal right
to use, all trademarks, tradenames, copyrights, technology, know-how and
processes (the “Intellectual Property”) necessary for each of them to
conduct its business as currently conducted except for those the failure to own
or have such legal right to use could not have a Material Adverse Effect.

 

6.18        Solvency.

 

Each Credit Party
is and, after consummation of the transactions contemplated by the Credit
Documents, will be Solvent.

 

6.19        Investments.

 

All Investments of
each Consolidated Party are Permitted Investments.

 

6.20        Principal Offices.

 

Set forth on Schedule 6.20
is the chief executive office and principal place of business of each Credit
Party.  Schedule 6.20 may be
updated from time to time by the Borrowers by giving written notice thereof to
the Agent.

 

47

 

6.21        Disclosure.

 

Neither this
Credit Agreement nor any financial statements delivered to the Lenders nor any
other document, certificate or statement furnished to the Lenders by or on
behalf of any Consolidated Party in connection with the transactions
contemplated hereby contains any untrue statement of a material fact or omits
to state a material fact necessary in order to make the statements contained
therein or herein not misleading.

 

6.22        No Burdensome Restrictions.

 

No Consolidated
Party is a party to any agreement or instrument or subject to any other
obligation or any charter or corporate restriction or any provision of any
applicable law, rule or regulation which, individually or in the aggregate, could
have a Material Adverse Effect.

 

6.23        Brokers’ Fees.

 

No Consolidated
Party has any obligation to any Person in respect of any finder’s, broker’s,
investment banking or other similar fee in connection with any of the
transactions contemplated under the Credit Documents.

 

6.24        Labor Matters.

 

There are no
collective bargaining agreements or Multiemployer Plans covering the employees
of a Consolidated Party as of the Closing Date and none of the Consolidated
Parties has suffered any strikes, walkouts, work stoppages or other material
labor difficulty within the last five years.

 

6.25        Nature of Business.

 

As of the Closing
Date, the Consolidated Parties are engaged in the business of acquiring,
owning, operating, managing and developing restaurant, service station, other
service retail properties and several miscellaneous properties (including
billboard properties, one office building and one fuel terminal facility).

 

6.26        REIT Status.

 

The USRP REIT is
qualified as a REIT and each of its Subsidiaries that is a corporation is a
Qualified REIT Subsidiary.  Each of the
Subsidiaries of the USRP REIT set forth on Schedule 6.26 is a taxable
REIT subsidiary, as such term is used in the Code. The USRP REIT has no
Subsidiaries that are taxable REIT subsidiaries except those set forth on Schedule
6.26.

 

6.27        Bankruptcy Remote Borrowing Entity.

 

Each of S&C,
HCI and each of its Wholly Owned Subsidiaries, JV1 and each of its Wholly Owned
Subsidiaries and the General SPE is a Bankruptcy Remote Borrowing Entity.  USRP Operating owns 99% of the Capital Stock
of the General SPE.  USRP Holding owns
100% of the Capital Stock of S&C. 
JV1 holds 100% of the Capital Stock of HCI.  USRP Operating owns 100% of the Capital Stock of JV1.

 

6.28        Closing Date Borrowing Base Assets.

 

Schedule 6.28
sets forth each of the Borrowing Base Assets as of the Closing Date.  Each asset listed on Schedule 6.28
fully qualifies as a Borrowing Base Asset and, collectively, the assets listed
thereon qualify to be included in the Borrowing Base.

 

6.29        Tax Shelter Regulations.

 

The Borrower does not
intend to treat the Loans and/or Letters of Credit and related transactions as
being a “reportable transaction” (within the meaning of Treasury Regulation
section 1.6011-4). If the Borrower determines to take any action inconsistent
with such intention, it will promptly notify the Agent thereof.  The Borrower acknowledges that the Agent
and/or one or more of the Lenders may treat the Loans as part of a transaction
that is

 

48

 

subject to Treasury Regulation section 1.6011-4 or section 301.6112-1,
and the Agent and such Lender or Lenders, as applicable, may file such IRS
forms or maintain such lists and other records as they may determine is
required by such Treasury Regulations.

 

6.30        Representations and Warranties
Under Revolving Credit Documents.

 

All of the
representations and warranties of the Borrower and the other “Credit Parties”
as defined in the Revolving Credit Agreement and the other Revolving Credit Documents
are true and correct in all material respects (except to the extent the same
have been waived in accordance with the terms thereof).

 

ARTICLE VII

AFFIRMATIVE COVENANTS

 

Each Credit Party
hereby covenants and agrees that, so long as this Credit Agreement is in effect
or any amounts payable hereunder or under any other Credit Document shall
remain outstanding:

 

7.1          Information Covenants.

 

The Credit Parties
will furnish, or cause to be furnished, to the Agent and each of the Lenders:

 

(a)           Annual
Financial Statements.  As soon as
available, and in any event within 90 days after the close of each fiscal year
of the Consolidated Parties, a consolidated balance sheet and income statement
of the Consolidated Parties as of the end of such fiscal year, together with
related consolidated statements of retained earnings and cash flows for such
fiscal year (along with a summary of amount of all Asset Dispositions and
Equity Issuances that were made during the prior fiscal year), in each case
setting forth in comparative form consolidated figures for the preceding fiscal
year, all such financial information described above to be in reasonable form
and detail and audited by independent certified public accountants of
recognized national standing reasonably acceptable to the Agent and whose
opinion shall be to the effect that such financial statements have been
prepared in accordance with GAAP (except for changes with which such
accountants concur) and shall not be limited as to the scope of the audit or
qualified as to the status of the Consolidated Parties as a going concern or
any other material qualifications or exceptions.

 

(b)           Quarterly
Financial Statements.  As soon as
available, and in any event within 45 days after the close of each of the first
three fiscal quarters of each fiscal year of the Consolidated Parties, a
consolidated balance sheet and income statement of the Consolidated Parties as
of the end of such fiscal quarter, together with related consolidated
statements of retained earnings and cash flows for such fiscal quarter, in each
case setting forth in comparative form consolidated figures for the
corresponding period of the preceding fiscal year, all such financial
information described above to be in reasonable form and detail and reasonably
acceptable to the Agent, and accompanied by a certificate of an Executive
Officer of the Borrower to the effect that such quarterly financial statements
fairly present in all material respects the financial condition of the
Consolidated Parties and have been prepared in accordance with GAAP, subject to
changes resulting from audit and normal year-end audit adjustments.

 

(c)           Officer’s
Certificate.  At the time of
delivery of the financial statements provided for in Sections 7.1(a) and
7.1(b) above, a certificate of an Executive Officer of the Borrower
substantially in the form of Exhibit 7.1(c), (i) demonstrating
compliance with the Financial Covenants by calculation thereof as of the end of
each such fiscal period, (ii) stating that no Default or Event of Default
exists, or if any Default or Event of Default does exist, specifying the nature
and extent thereof and what action the Credit Parties propose to take with
respect thereto and disclosing any Hedging Agreements entered into by any
Consolidated Party.

 

(d)           Intentionally
Omitted.

 

49

 

(e)           Accountant’s
Certificate.  Within the period for
delivery of the annual financial statements provided in Section 7.1(a), a
certificate of the accountants conducting the annual audit stating that they
have reviewed this Credit Agreement as it relates to accounting and other
financial matters and stating further whether, in the course of their audit,
they have become aware of any Default or Event of Default and, if any such
Default or Event of Default exists, specifying the nature and extent thereof, provided
that such accountants shall not be liable by reason of any failure to obtain
knowledge of any such Default or Event of Default that would not be disclosed
in the course of their audit examination.

 

(f)            Auditor’s
Reports.  Promptly upon receipt
thereof, a copy of any other report or “management letter” submitted by
independent accountants to any Consolidated Party in connection with any
annual, interim or special audit of the books of such Person.

 

(g)           Reports.  Promptly upon transmission or receipt
thereof, (i) copies of any filings and registrations with, and reports to
or from, the Securities and Exchange Commission, or any successor agency, and
copies of all financial statements, proxy statements, notices and reports as
any Consolidated Party shall send to its shareholders or to a holder of any
Indebtedness owed by any Consolidated Party in its capacity as such a holder
and (ii) upon the request of the Agent, all reports and written
information to and from the United States Environmental Protection Agency, or
any state or local agency responsible for environmental matters, the United
States Occupational Health and Safety Administration, or any state or local
agency responsible for health and safety matters, or any successor agencies or
authorities concerning environmental, health or safety matters.

 

(h)           Notices.  Upon any Executive Officer of a Credit Party
obtaining knowledge thereof, the Credit Parties will give written notice to the
Agent immediately of (i) the occurrence of an event or condition
consisting of a Default or Event of Default, specifying the nature and
existence thereof and what action the Credit Parties propose to take with
respect thereto, and (ii) the occurrence of any of the following with
respect to any Consolidated Party (A) the pendency or commencement of any
litigation, arbitral or governmental proceeding against such Person which if
adversely determined is likely to have a Material Adverse Effect or (B) the
institution of any proceedings against such Person with respect to, or the
receipt of notice by such Person of potential liability or responsibility for
violation, or alleged violation of any Federal, state or local law, rule or
regulation, including but not limited to, Environmental Laws, the violation of
which could have a Material Adverse Effect.

 

(i)            ERISA.  Upon any Executive Officer of a Credit Party
obtaining knowledge thereof, the Credit Parties will give written notice to the
Agent promptly (and in any event within five Business Days) of: (i) any
event or condition, including, but not limited to, any Reportable Event, that
constitutes, or might reasonably lead to, an ERISA Event; (ii) with
respect to any Multiemployer Plan, the receipt of notice as prescribed in ERISA
or otherwise of any withdrawal liability assessed against the Credit Parties or
any ERISA Affiliates, or of a determination that any Multiemployer Plan is in
reorganization or insolvent (both within the meaning of Title IV of ERISA);
(iii) the failure to make full payment on or before the due date
(including extensions) thereof of all amounts which any Consolidated Party or
any ERISA Affiliate is required to contribute to each Plan pursuant to its
terms and as required to meet the minimum funding standard set forth in ERISA
and the Code with respect thereto; or (iv) any change in the funding
status of any Plan that could have a Material Adverse Effect, together with a
description of any such event or condition or a copy of any such notice and a
statement by an Executive Officer of the Borrower briefly setting forth the
details regarding such event, condition, or notice, and the action, if any,
which has been or is being taken or is proposed to be taken by the Credit
Parties with respect thereto.  Promptly
upon request, the Credit Parties shall furnish the Agent and the Lenders with
such additional information concerning any Plan as may be reasonably requested,
including, but not limited to, copies of each annual report/return
(Form 5500 series), as well as all schedules and attachments thereto
required to be filed with the Department of Labor and/or the Internal Revenue
Service pursuant to ERISA and the Code, respectively, for each “plan year”
(within the meaning of Section 3(39) of ERISA).

 

(j)            Environmental.  Upon the reasonable written request of the
Agent, the Credit Parties will furnish or cause to be furnished to the Agent,
at the Credit Parties’ expense, a report of an environmental assessment of
reasonable scope, form and depth, (including, where appropriate, invasive soil
or groundwater sampling) by a consultant reasonably acceptable to the Agent as
to the nature and extent of the presence of any

 

50

 

Materials of
Environmental Concern on any Real Properties (as defined in Section 6.16)
contributing to the Borrowing Base and as to the compliance by any Consolidated
Party with Environmental Laws at such Real Properties.  If the Credit Parties fail to deliver such
an environmental report within seventy-five (75) days after receipt of
such written request then the Agent may arrange for same, and the Consolidated
Parties hereby grant to the Agent and their representatives access to the Real
Properties to reasonably undertake such an assessment (including, where
appropriate, invasive soil or groundwater sampling).  The reasonable cost of any assessment arranged for by the Agent
pursuant to this provision will be payable by the Credit Parties on demand and
added to the Credit Party Obligations.

 

(k)           Borrowing
Base Certificates/Delinquency Reports. 
Within 15 days after the end of each calendar month, a certificate as of
the end of the immediately preceding month, substantially in the form of Exhibit 7.1(k)
and certified by an Executive Officer of the Borrower to be true and correct as
of the date thereof (a “Borrowing Base Certificate”) and a Delinquency
Report with respect to the last day of such calendar month certified by an
Executive Officer of the Borrower to be true and correct as of such date.

 

(l)            Three
Year Projections/Updates.  As soon
as available, and in any event within 90 days after the close of each fiscal
year of the Consolidated Parties, detailed projections of financial statements
for the Consolidated Parties and of calculations with respect to each of the
Financial Covenants, in each case, for the three year period following the most
recently ended fiscal quarter of the Consolidated Parties.

 

(m)          Other
Information.  With reasonable
promptness upon any such request, such other information regarding the
business, properties or financial condition of any Consolidated Party as the
Agent or the Required Lenders may reasonably request.

 

(n)           Reportable
Transactions.  Promptly after
Borrower has notified Agent of any intention by Borrower to treat Loans and
related transactions as being a “reportable transaction” (within the meaning of
Treasury Regulation Section 1.6011-4), a duly completed copy of IRS Form 8886
or any successor form (and Borrower hereby agrees that the Agent and each Lender
may disclose to any and all Persons, without limitation of any kind, any
information with respect to the “tax treatment” and “tax structure” (in each
case, within the meaning of Treasury Regulation Section 1.6011-4) of the
transactions contemplated hereby and all materials of any kind (including
opinions or other tax analyses) that are provided to the Agent or such Lender
relating to such tax treatment and tax structure).

 

7.2          Preservation of Existence,
Franchises, Bankruptcy Remote Borrowing Entity Status and REIT Status.

 

Except as a result
of or in connection with a dissolution, merger or disposition of a Subsidiary
not prohibited by Section 8.4 or Section 8.5, each Credit Party will,
and will cause each of its corporate Subsidiaries to, do all things necessary
to preserve and keep in full force and effect its existence, rights,
franchises, authority and status as a REIT or Qualified REIT Subsidiary, as
applicable.  The General SPE, HCI and
its Wholly Owned Subsidiaries, JV1 and its Wholly Owned Subsidiaries and
S&C shall each maintain their respective status as a Bankruptcy Remote
Borrowing Entities and each of the Credit Parties shall take such action as is
required to maintain such status at all times during the term hereof.  The General SPE shall, at all times during
the term hereof, remain a Wholly Owned Subsidiary of USRP Operating.  S&C shall, at all times during the term
hereof, remain a Wholly Owned Subsidiary of USRP Holding.  USRP Holding shall, at all times during the
term hereof, remain a Wholly Owned Subsidiary of USRP Operating.  JV1 shall, at all times during the term
hereof, remain a Wholly Owned Subsidiary of USRP Operating.  HCI shall, at all times during the term
hereof, be subject either to the ownership structure set forth on Schedule
6.13A as of the Closing Date or be a Wholly Owned Subsidiary of JV1. The
entities set forth on Schedule 6.26 shall, at all times during the term
hereof, remain taxable REIT subsidiaries, as such term is used in the Code;
provided, that such schedule may be amended from time to time by the Borrower
with the consent of the Agent, which consent may be withheld in the Agent’s
reasonable discretion.

 

51

 

7.3          Books and Records.

 

Each Credit Party
will, and will cause each of its Subsidiaries to, keep complete and accurate
books and records of its transactions in accordance with good accounting
practices on the basis of GAAP (including the establishment and maintenance of
appropriate reserves).

 

7.4          Compliance with Law.

 

Each Credit Party
will, and will cause each of its Subsidiaries to, comply with all laws, rules,
regulations and orders, and all applicable restrictions imposed by all
Governmental Authorities, applicable to it and its Property if noncompliance
with any such law, rule, regulation, order or restriction could have a Material
Adverse Effect.

 

7.5          Payment of Taxes and Other
Indebtedness.

 

Each Credit Party will, and will cause each of its
Subsidiaries to, pay and discharge (a) all taxes, assessments and governmental
charges or levies imposed upon it, or upon its income or profits, or upon any
of its properties, before they shall become delinquent, (b) all lawful
claims (including claims for labor, materials and supplies) which, if unpaid,
might give rise to a Lien upon any of its properties, and (c) except as
prohibited hereunder, all of its other Indebtedness as it shall become due; provided,
however, that no Consolidated Party shall be required to pay any such
tax, assessment, charge, levy, claim or Indebtedness which is being contested
in good faith by appropriate proceedings and as to which adequate reserves
therefor have been established in accordance with GAAP, unless the failure to
make any such payment (i) could give rise to an immediate right to foreclose
on a Lien securing such amounts or (ii) could have a Material Adverse
Effect.

 

7.6          Insurance.

 

Each Consolidated Party
will, and will cause each of its Subsidiaries to, at all times maintain in full
force and effect insurance (including worker’s compensation insurance,
liability insurance, environmental insurance, casualty insurance and business
interruption insurance) in such amounts, covering such risks and liabilities
and with such deductibles or self-insurance retentions as are in accordance with
normal industry practice.  The present
insurance coverage of the Consolidated Parties is outlined as to carrier,
policy number, expiration date, type and amount on Schedule 7.6,
and the Borrower shall update such Schedule 7.6 and notify the
Agent immediately upon the occurrence of any change in such insurance coverage.

 

7.7          Maintenance of Property.

 

Each Credit Party
will, will cause each of its Subsidiaries to, and (as applicable) will use its
best efforts to cause the applicable Person in possession of a Real Property
to, maintain and preserve its properties and equipment material to the conduct
of its business in good repair, working order and condition, normal wear and
tear and casualty and condemnation excepted, and will make, or cause to be
made, in such properties and equipment from time to time all repairs, renewals,
replacements, extensions, additions, betterments and improvements thereto as
may be needed or proper, to the extent and in the manner customary for
companies in similar businesses.

 

7.8          Performance of Obligations.

 

Each Credit Party
will, and will cause each of its Subsidiaries to, perform in all material
respects all of its obligations under the terms of all material agreements and
all material indentures, mortgages, security agreements or other debt
instruments to which it is a party or by which it is bound.

 

7.9          Use of Proceeds.

 

The Borrower will
use the proceeds of the Loans solely for the purposes set forth in
Section 6.15.

 

52

 

7.10        Audits/Inspections.

 

Upon reasonable
notice and during normal business hours, each Credit Party will, and will cause
each of its Subsidiaries to, permit representatives appointed by the Agent,
including, without limitation, independent accountants, agents, attorneys, and
appraisers to visit and inspect its property (subject to the rights of tenants
under their respective leases), including its books and records, its accounts
receivable and inventory, its facilities and its other business assets, and to
make photocopies or photographs thereof and to write down and record any
information such representative obtains and shall permit the Agent or its
representatives to investigate and verify the accuracy of information provided
to the Lenders and to discuss all such matters with the officers, employees and
representatives of such Person.

 

7.11        Financial Covenants.

 

(a)           Leverage
Ratio.  The Leverage Ratio, as of
the last day of each fiscal quarter of the Consolidated Parties, shall be (i)
for fiscal quarters ending on or before September 30, 2005, less than or equal
to 0.65 to 1.0; and (ii) for fiscal quarters ending thereafter, less than or
equal to .60 to 1.0.

 

(b)           Tangible
Net Worth.  At all times the
Tangible Net Worth shall be greater than or equal to the sum of (i)
$230,000,000.00, plus (ii) an amount equal to 85% of the Net Cash
Proceeds of any Equity Issuance by the Consolidated Parties issued after
September 30, 2003, calculated on a cumulative basis.

 

(c)           Fixed
Charge Coverage Ratio.  The Fixed
Charge Coverage Ratio, as of the last day of each fiscal quarter of the
Consolidated Parties, shall be (i) for fiscal quarters ending on or before
September 30, 2005, greater than or equal to 1.40 to 1.0; and (ii) for fiscal
quarters ending thereafter, greater than or equal to 1.50 to 1.0.

 

(d)           Distribution
Limitation.  For any given fiscal quarter of the Consolidated Parties, the aggregate
sum of (i) the amount of cash distributions made or declared by the
Consolidated Parties to their shareholders (excluding any shareholders which
are Consolidated Parties) plus (ii) the amount spent by the Consolidated
Parties for the purpose of repurchasing their own Capital Stock (whether common
or preferred) shall not exceed the greater of (1) the FFO Distribution
Allowance for such fiscal quarter or (2) so long as no Default or Event of
Default has occurred and is then continuing, the amount necessary to maintain
the status of the USRP REIT as a REIT.

 

(e)           Secured Indebtedness to Asset Value Ratio.  The ratio of (i) Secured Indebtedness
of the Consolidated Parties on a consolidated basis to (ii) the sum of Asset Values for each of the Real Properties (less
any amounts attributable to Minority Interests) as of the end of each fiscal
quarter of the Consolidated Parties shall be less than or equal to 0.40 to 1.0.

 

(f)            Debt Service Coverage Ratio.  The Debt Service Coverage Ratio shall be, at
all times, be equal to or greater than 2.25 to 1.0.

 

For clarification
purposes, the Credit Parties shall be permitted, in determining compliance with
the financial covenants set forth above in clauses (a), (c), (d) and (f) of
this Section 7.11, to round the results of the final ratio calculations (but
not calculations of any of other amounts used in determining such ratios) to
the nearest hundredth (.01).

 

7.12        New Subsidiaries.

 

As soon as
practicable and in any event within 30 days after any Person becomes a direct
or indirect Subsidiary of the General Partner, the USRP REIT or the Borrower,
the Borrower shall provide the Agent with written notice thereof setting forth
information in reasonable detail describing all of the assets of such Person
and shall (a) if such Person is a Domestic Subsidiary, cause such
Person to (a) execute a Joinder Agreement in substantially the same form as Exhibit 7.12
and (b) deliver such other documentation as the Agent may reasonably
request in connection therewith, including, without limitation, financial
statements, certified resolutions and other organizational and authorizing
documents of such Person, favorable opinions of counsel to such Person (which
shall cover, among other things, the legality, validity, binding effect and
enforceability of the documentation referred to above) and other items of the
types required to be delivered pursuant to Section 5.1, as applicable, all
in form,

 

53

 

content and scope
reasonably satisfactory to the Agent; provided, that this Section 7.12
shall not be construed to require USRP Funding 2001-A, L.P., USRP (SFGP), LLC,
LLC, USRP (Hawaii), LLC, USRP (Bob), LLC and Fuel Supply, Inc. (or their
respective successor entities) to execute Joinder Agreements or otherwise act
as Subsidiary Guarantors hereunder unless and until (i) with respect to USRP
Funding 2001-A, L.P., such entity ceases to maintain its status as a Special
Purpose Entity, or (ii) with respect to each such entity, such entity is not
prohibited by the terms of other financing transactions or its organizational
documents from acting as a Guarantor hereunder.  For purposes of the preceding sentence, it is understood that no
entity shall be deemed prohibited from executing a Joinder Agreement once it
becomes a Wholly Owned Subsidiary by virtue of a provision in its
organizational documents notwithstanding any such provision in such documents.

 

7.13        ERISA Exemptions.

 

Each Credit Party and the Borrower shall not, and shall not permit any of
their respective Subsidiaries to, permit any of their respective assets to
become or be deemed to be “plan assets” within the meaning of ERISA, the Code
and the respective regulations promulgated thereunder.

 

7.14        Further Assurances.

 

The Borrower
shall, from time to time, at the expense of the Borrower, promptly execute,
deliver, file and/or record all further instruments and documents, and take all
further action, that may be necessary or desirable, or that the Agent or
Collateral Agent may reasonably request in order to (a) properly evidence the
Borrower’s Indebtedness hereunder or under any Credit Document or (b) perfect,
continue and protect the pledge, assignment and/or security interest, as
applicable, granted or purported to be granted hereby or pursuant to any Credit
Document and to enable the Agent and/or Collateral Agent to exercise and
enforce their rights and remedies hereunder and under any other Credit
Document.  The Borrower shall promptly
deliver to the Collateral Agent and the Agent a copy of each such instrument
and evidence of its proper filing or recording, as necessary.

 

ARTICLE VIII

NEGATIVE COVENANTS

 

Each Credit Party
hereby covenants and agrees that, so long as this Credit Agreement is in effect
or any amounts payable hereunder or under any other Credit Document shall
remain outstanding:

 

8.1          Indebtedness.

 

The Credit Parties
will not permit any Consolidated Party to contract, create, incur, assume or
permit to exist any Indebtedness, except:

 

(a)           Indebtedness
arising under this Credit Agreement, the other Credit Documents and the
Revolving Credit Documents;

 

(b)           Indebtedness under the Hawaii Loan Documents or
in existence as of the Agreement Date and described on Schedule 8.1
and any Indebtedness (the “Replacement Indebtedness”) extending the
maturity of, or refunding, refinancing or replacing, in whole or in part, any
such existing Indebtedness (the “Replaced Indebtedness”) so long as (i)
the direct and contingent obligors with respect to the Replaced Indebtedness
and the Replacement Indebtedness shall be the same, (ii) the Replacement
Indebtedness shall not mature prior to the stated maturity date or mandatory
redemption date of the Replaced Indebtedness, (iii) if the Replaced
Indebtedness is subordinated in right of payment or otherwise to the
obligations of each of the Credit Parties under and in respect of the Credit
Documents to which any of them is a party, then the Replacement Indebtedness
must be subordinated to such obligations to at least the same extent and (iv)
the Replacement Indebtedness otherwise complies with all other terms and
conditions contained in any other Section of this Credit Agreement;

 

54

 

(c)           purchase
money Indebtedness (including obligations in respect of Capital Leases or
Synthetic Leases) hereafter incurred by the Borrower or any of its Subsidiaries
to finance the purchase of fixed assets; provided that (i) the
total of all such Indebtedness for all such Persons taken together shall not
exceed an aggregate principal amount of $250,000 at any one time outstanding;
(ii) such Indebtedness when incurred shall not exceed the purchase price
of the asset(s) financed; and (iii) no such Indebtedness shall be
refinanced for a principal amount in excess of the principal balance
outstanding thereon at the time of such refinancing;

 

(d)           Indebtedness resulting from customary recourse carve-outs
associated with securitization transactions (including, by way of example,
those for fraud, misapplication of proceeds and environmental indemnities) and
not involving the creditworthiness of the applicable obligors;

 

(e)           Indebtedness
in the form of trade payables incurred in the ordinary course of business;

 

(f)            obligations
of the Borrower in respect of Hedging Agreements to the extent such agreements
are for the purpose of hedging interest rate risk with respect to the
Indebtedness under the Credit Documents or are otherwise approved by the Agent,
in its discretion;

 

(g)           intercompany Indebtedness permitted
under Section 8.6; provided, however,
that the obligations of each obligor of such Indebtedness shall: (i) be
subordinated to the Credit Party Obligations on terms acceptable to the
Required Term Loan Lenders in their sole discretion and (ii) have such other
terms and provisions as the Agent may reasonably require;

 

(h)           in
addition to the Indebtedness otherwise permitted by this Section 8.1,

 

(i)            other
recourse Indebtedness hereafter incurred by the General Partner, the Borrower
or any of their Subsidiaries provided that (A) the loan
documentation with respect to such Indebtedness shall not contain financial
covenants or default provisions relating to any Consolidated Party that are
more restrictive than the covenants and default provisions contained in the
Credit Documents, (B) the Borrower shall have delivered to the Agent a Pro
Forma Compliance Certificate demonstrating that, upon giving effect on a Pro
Forma Basis to the incurrence of such Indebtedness and to the concurrent
retirement of any other Indebtedness of any Consolidated Party, the Credit
Parties would be in compliance with the Financial Covenants and (C) the
aggregate principal amount of such Indebtedness, together with Indebtedness
permitted pursuant to Sections 8.1(c) and (f) shall not at any time exceed
$20,000,000 plus the amount of any hedge obligations incurred with respect to a
Term Securitization;

 

(ii)           Indebtedness
where the recourse of the lender is limited to foreclosure of its security
interest in the subject property; and

 

(iii)          Guaranty
Obligations of any Guarantor with respect to any Indebtedness permitted under
this Section 8.1.

 

Notwithstanding the foregoing, the General Partner and the Borrower shall
not, and shall not permit any other Subsidiary to, create, incur or assume any
Indebtedness after the Closing Date if immediately prior to the creation,
incurring or assumption thereof, or immediately thereafter and after giving
effect thereto, a Default or Event of Default is or would be in existence,
including without limitation, a Default or Event of Default resulting from a
violation of any of the covenants contained in this Section 8.1.

 

8.2          Liens.

 

The Credit Parties
will not permit any Consolidated Party to contract, create, incur, assume or
permit to exist any Lien with respect to any of its Property, whether now owned
or after acquired, except for:

 

(a)           Liens in favor of the Agent to secure
the Credit Party Obligations;

 

55

 

(b)           (i) Liens, about which any Credit
Party has had knowledge for less than thirty (30) days, in an aggregate
amount less than $200,000 (other than Liens created or imposed under ERISA) for
taxes, assessments or governmental charges or levies not yet due or, if due,
are for taxes, assessments or governmental charges or levies that are more than
five (5) days from the date on which such items may be deemed delinquent
or on which penalties for non-payment may be assessed or (ii) Liens for taxes
being contested in good faith by appropriate proceedings for which adequate
reserves determined in accordance with GAAP have been established (and as to
which the Property subject to any such Lien is not yet subject to foreclosure,
sale or loss on account thereof);

 

(c)           statutory Liens of landlords and
Liens of carriers, warehousemen, mechanics, materialmen and suppliers and other
Liens imposed by law or pursuant to customary reservations or retentions of
title arising in the ordinary course of business, in each case which any Credit
Party has had knowledge for less than thirty (30) days, in an aggregate
amount less than $200,000, provided that such Liens secure only amounts
not yet due and payable or, if due and payable, are unfiled and no other action
has been taken to enforce the same or are being contested in good faith by
appropriate proceedings for which adequate reserves determined in accordance
with GAAP have been established (and as to which the Property subject to any
such Lien is not yet subject to foreclosure, sale or loss on account thereof);

 

(d)           Liens (other than Liens created or
imposed under ERISA) incurred or deposits made by any Consolidated Party in the
ordinary course of business in connection with workers’ compensation, unemployment
insurance and other types of social security, or to secure the performance of
tenders, statutory obligations, bids, leases, government contracts, performance
and return-of-money bonds and other similar obligations (exclusive of
obligations for the payment of borrowed money);

 

(e)           Liens in connection with attachments
or judgments (including judgment or appeal bonds) provided that the
judgments secured shall, within 30 days after the entry thereof, have been
discharged or execution thereof stayed pending appeal, or shall have been
discharged within 30 days after the expiration of any such stay;

 

(f)            easements, rights-of-way,
restrictions (including zoning restrictions), minor defects or irregularities
in title and other similar charges or encumbrances not, in any material
respect, impairing the use of the encumbered Property for its intended
purposes;

 

(g)           Liens on Property of any Person
securing purchase money Indebtedness (including Capital Leases and Synthetic
Leases) of such Person permitted under Section 8.1(c), provided
that any such Lien attaches to such Property concurrently with or within 90
days after the acquisition thereof;

 

(h)           leases or subleases granted to others
not interfering in any material respect with the business of any Consolidated
Party;

 

(i)            any interest of title of a lessor
under, and Liens arising from UCC financing statements (or equivalent filings,
registrations or agreements in foreign jurisdictions) relating to, leases
permitted by this Credit Agreement;

 

(j)            Liens deemed to exist in connection
with Investments in repurchase agreements permitted under Section 8.6;

 

(k)           normal and customary rights of setoff
upon deposits of cash in favor of banks or other depository institutions;

 

(l)            Liens of a collection bank arising
under Section 4-210 of the Uniform Commercial Code on items in the course
of collection;

 

(m)          Liens of sellers of goods to the
Borrower and any of its Subsidiaries arising under Article 2 of the
Uniform Commercial Code or similar provisions of applicable law in the ordinary
course of

 

56

 

business, covering only
the goods sold and securing only the unpaid purchase price for such goods and
related expenses;

 

(n)           Liens existing as of the Closing Date
as set forth or as contemplated on Schedule 8.2; provided
that no such Lien shall at any time be extended to or cover any Property
other than the Property subject thereto on the Closing Date (other than in
connection with the collateral substitution provisions contained in the 2001-A
Term Securitization Documents);

 

(o)           Liens on property owned by USRP
(Bob), LLC, USRP (Hawaii), LLC and/or Fuel Supply, Inc. created in connection
with the Hawaii Loan Documents; and

 

(p)           Liens securing Indebtedness described
in Section 8.1(h)(ii).

 

8.3          Nature of Business.

 

The Credit Parties
will not permit any Consolidated Party to substantively alter the character or
conduct of the business conducted by such Person as of the Closing Date.

 

8.4          Consolidation, Merger, Dissolution, etc.

 

The Credit Parties
will not permit any Consolidated Party to enter into any transaction of merger
or consolidation or liquidate, wind up or dissolve itself (or suffer any
liquidation or dissolution); provided that, notwithstanding the
foregoing provisions of this Section 8.4 but subject to the terms of
Sections 7.12, (a) the Borrower or General Partner may merge or
consolidate with any of its Subsidiaries provided that the Borrower or
General Partner (as applicable) shall be the continuing or surviving corporation,
(b) any Credit Party other than the General Partner or the Borrower may
merge or consolidate with any other Credit Party other than the General Partner
or the Borrower, (c) any Consolidated Party which is not a Credit Party
may be merged or consolidated with or into any Credit Party; provided
that such Credit Party shall be the continuing or surviving corporation,
(d) any Consolidated Party which is not a Credit Party may be merged or
consolidated with or into any other Consolidated Party which is not a Credit
Party, and (e) any Wholly Owned Subsidiary of the Borrower may dissolve,
liquidate or wind up its affairs at any time provided that such dissolution,
liquidation or winding up, as applicable, could not have a Material Adverse
Effect and such entity does not hold any material property or assets (except to
the extent such property or assets are able to be transferred to a Credit Party
without additional consideration from such Credit Party and without adverse tax
consequences to such Credit Party).

 

8.5          Asset Dispositions/Substitution of
Assets.

 

(a)           The Credit Parties will not permit
any Consolidated Party to make any Asset Disposition or series of Asset
Dispositions in which the aggregate value of the assets sold or otherwise
disposed pursuant to such Asset Disposition or series of Asset Dispositions
exceeds an amount equal to (i) ten percent (10.0%) multiplied by (ii)
Total Tangible Assets, as calculated on the Closing Date, unless the Borrower
shall have delivered to the Agent at least two (2) Business Days prior to
such Asset Disposition or series of Asset Dispositions a Pro Forma Compliance
Certificate demonstrating on a Pro Forma Basis that, upon giving effect to such
Asset Disposition or series of Asset Dispositions, the Credit Parties shall be in
compliance with all of the covenants contained in Section 7.11.

 

(b)           Neither the General SPE, nor HCI or
any of its Wholly Owned Subsidiaries, nor JV1 or any of its Wholly Owned
Subsidiaries, nor S&C shall sell, transfer, assign, pledge, encumber or
otherwise dispose of any of their respective assets except to the extent such
entity obtains the prior written consent of the Agent (which consent may be
withheld at the sole reasonable discretion of the Agent).

 

8.6          Investments.

 

The Credit Parties
will not permit any Consolidated Party to make or have any Investments after
the Closing Date, except for:

 

57

 

(a)           Investments in any Credit Party;

 

(b)           Investments consisting of cash and
Cash Equivalents;

 

(c)           Investments consisting of accounts
receivable created, acquired or made by any Consolidated Party in the ordinary
course of business and payable or dischargeable in accordance with customary
trade terms;

 

(d)           Investments consisting of Capital
Stock, obligations, securities or other property received by any Consolidated
Party in settlement of accounts receivable (created in the ordinary course of
business) from bankrupt obligors or guarantors of bankrupt obligors;

 

(e)           Investments consisting of loans or
advances to Tenants in an amount not to exceed $25,000,000.00 in the aggregate;

 

(f)            Investments consisting of advances
or loans to employees existing as of the date hereof and additional such
Investments made following the date hereof that do not, in the aggregate,
exceed the sum of $100,000.00;

 

(g)           Investments entered into in
connection with a Term Securitization permitted and contemplated hereunder;

 

(h)           Investments in non-wholly owned
general and limited partnerships, joint ventures and other Persons which are not
corporations (excluding such Investments in existence as of the date hereof),
the aggregate book value of which constitutes less than five percent (5%)
of Total Tangible Assets;

 

(i)            Investments in Development
Activities; provided, that (i) the aggregate amount of Investments made
by the Consolidated Parties with respect to such Development Activities shall
not, at any one time, exceed $15,000,000.00 and (ii) all costs and expenses
associated with all existing Development Activities (budget to completion)
shall be included in determining the aggregate Investment of the Consolidated
Parties with respect to such activities;

 

(j)            Investments consisting of loans to
Persons who have or are purchasing real property from a Consolidated Party;
provided that (i) the total aggregate amount of such loans shall not exceed
$45,000,000.00, (ii) such loans shall be made on a secured basis and (iii) such
loans shall be made on commercially reasonable terms and require at least 10%
cash equity;

 

(k)           Investments in marketable securities
that do not, in the aggregate, exceed the sum of $5,000,000.00;

 

(l)            Investments in common equity
securities that do not, in the aggregate, exceed the sum of $5,000,000.00 and
Investments in preferred equity securities that do not, in the aggregate,
exceed the sum of $5,000,000.00; provided, that, the Agent is given a summary
of the amount and type of such equity securities prior to the making of such
investment; and

 

(m)          Investments in debt securities that do
not, in the aggregate, exceed $30,000,000.00; provided, that such debt
securities are fully performing and have a current yield equal to or in excess
of 9.50%.

 

Notwithstanding
the foregoing, the Credit Parties will not permit the total Investments of the
Consolidated Parties related to items (c) through (m) above shall not, in any
case, exceed 12.0% of Total Tangible Assets.

 

8.7          Restricted Payments.

 

Except as set
forth on Schedule 8.11, the Credit Parties will not permit any
Consolidated Party to, directly or indirectly, declare, order, make or set
apart any sum for or pay any Restricted Payment, except (a) to make
dividends or other distributions payable to any Credit Party (directly or
indirectly through Subsidiaries), (b) Special
Purpose Entities

 

58

 

may
(directly or indirectly through any intermediate Subsidiaries) (i) make
Restricted Payments to the extent required to do so under the terms of a Term
Securitization and (ii) distribute I/O Strips and other assets to the General
Partner, the Borrower or any other Guarantor and (c) as expressly
permitted by Section 7.11(d), Section 8.6, Section 8.8 or
Section 8.9.

 

8.8          Other Indebtedness.

 

The Credit Parties
will not permit any Consolidated Party to if any Default or Event of Default
has occurred and is continuing or would be directly or indirectly caused as a
result thereof, (a) after the issuance thereof, amend or modify any of the
terms of any Indebtedness of such Consolidated Party if such amendment or
modification would add or change any terms in a manner adverse to such
Consolidated Party, or shorten the final maturity or average life to maturity
or require any payment to be made sooner than originally scheduled or increase
the interest rate applicable thereto, or (b) make (or give any notice with
respect thereto) any voluntary or optional payment or prepayment or redemption
or acquisition for value of (including without limitation, by way of depositing
money or securities with the trustee with respect thereto before due for the
purpose of paying when due), refund, refinance or exchange of any other
Indebtedness of such Consolidated Party.

 

8.9          Transactions with Affiliates.

 

The Credit Parties
will not permit any Consolidated Party to enter into or permit to exist any
transaction or series of transactions with any officer, director, shareholder,
Subsidiary or Affiliate of such Person other than (a) advances of working
capital to any Credit Party, (b) transfers of cash and assets to any
Credit Party, (c) intercompany transactions expressly permitted by
Section 8.1, Section 8.4, Section 8.5, Section 8.6, or
Section 8.7, (d) normal compensation and reimbursement of expenses of
officers and directors and (e) except as otherwise specifically limited in
this Credit Agreement, other transactions which are entered into in the
ordinary course of such Person’s business on terms and conditions substantially
as favorable to such Person as would be obtainable by it in a comparable
arms-length transaction with a Person other than an officer, director, shareholder,
Subsidiary or Affiliate.

 

8.10        Fiscal Year; Organizational
Documents.

 

The Credit Parties
will not permit any Consolidated Party to change its fiscal year or amend,
modify or change its articles of incorporation (or corporate charter or other
similar organizational document) or bylaws (or other similar document).

 

8.11        Limitation on Restricted Actions.

 

The Credit Parties
will not permit any Consolidated Party to, directly or indirectly, create or
otherwise cause or, except as set forth on Schedule 8.11, suffer to
exist or become effective any encumbrance or restriction on the ability of any
such Person to (a) pay dividends or make any other distributions to any
Credit Party on its Capital Stock or with respect to any other interest or
participation in, or measured by, its profits, (b) pay any Indebtedness or
other obligation owed to any Credit Party, (c) make loans or advances to
any Credit Party, (d) sell, lease or transfer any of its properties or
assets to any Credit Party, or (e) act as a Credit Party and pledge its
assets pursuant to the Credit Documents or any renewals, refinancings,
exchanges, refundings or extension thereof, except (in respect of any of the
matters referred to in clauses (a)-(d) above) for such encumbrances or
restrictions existing under or by reason of (i) this Credit Agreement and
the other Credit Documents, (ii) applicable law, (iii) any document
or instrument governing Indebtedness incurred pursuant to (A)
Section 8.1(b), and (B) with respect to clause (d) of this Section 8.11
only, Section 8.1(h), provided that any such restriction contained
therein relates only to the asset or assets constructed or acquired in
connection therewith, (iv) any Permitted Lien or any document or
instrument governing any Permitted Lien, provided that any such
restriction contained therein relates only to the asset or assets subject to
such Permitted Lien or (v) customary restrictions and conditions contained
in any agreement relating to the sale of any Property permitted under Section 8.5
pending the consummation of such sale.

 

8.12        Contingent Obligations.

 

Neither
the General Partner nor the Borrower shall become or remain liable, or permit
any other Subsidiary to become or remain liable, on or under any Contingent
Obligation other than the following:

 

59

 

(a)           Contingent Obligations arising under
any of the Credit Documents;

 

(b)           Contingent Obligations in existence
as of the Closing Date (the material ones having been disclosed to the Agent in
writing on Schedule 8.12(b) attached hereto) and any Contingent
Obligation incurred in replacement, in whole or in part, of any such existing
Contingent Obligations so long as (i) the amount of such replacement Contingent
Obligation shall not be increased, (ii) such replacement Contingent Obligation
shall not mature or otherwise be required to be performed prior to the
corresponding maturity or performance date of the Contingent Obligation being
so replaced, and (iii) if the Contingent Obligation being so replaced is
subordinated to any of the Credit Party Obligations, such replacement
Contingent Obligation shall be subordinated to such obligations to at least the
same extent;

 

(c)           Contingent Obligations resulting from
endorsement of negotiable instruments for collection or deposit in the ordinary
course of business;

 

(d)           Contingent Obligations incurred in
the ordinary course of business with respect to surety and appeal bonds,
performance and return-of-money bonds and other similar obligations;

 

(e)           Contingent Obligations to the extent
constituting Indebtedness permitted under Section 8.1; and

 

(f)            Guaranties by a Consolidated Party
of the obligations of another Consolidated Party;

 

8.13        Sale Leasebacks.

 

Notwithstanding
anything contained herein to the contrary, the Credit Parties will not permit
any Consolidated Party to enter into any Sale and Leaseback Transaction (except
to the extent USRP (Bob), LLC or USRP (Hawaii), LLC enters into any such
transaction with respect to any gas station assets held by such Person).

 

8.14        Borrowing Base Asset Removal.

 

(a)           Notwithstanding
anything to the contrary contained herein, prior to the date on which the
obligations under the Revolving Credit Documents are Fully Satisfied, no Credit
Party shall, at any time, seek to otherwise voluntarily remove or permit to be
removed any Borrowing Base Assets from qualification as such (whether in
anticipation of the Disposition or encumbrance thereof or otherwise), unless
(i) the Borrower shall have delivered to the Agent (and, to the extent such
removal shall require Required Lender approval, the Required Lenders) at least
twenty (20) Business Days prior to the effective date of such removal, a Pro
Forma Compliance Certificate demonstrating that, upon giving effect to such
removal, on a Pro Forma Basis, the Credit Parties shall be in compliance with
all of the Financial Covenants contained herein and (ii) to the extent (A) the
Borrowing Base Asset Value attributable to the Borrowing Base Asset(s) proposed
for removal, plus the Borrowing Base Asset Values attributable to all other
such assets that have been removed during the previous twelve (12) calendar
months or that have been approved for removal pursuant to the terms hereof
during such period (and which the Borrower still intends to remove from the
Borrowing Base calculation) is less than ten percent (10.0%) of the aggregate
Borrowing Base Asset Value, as determined as of the Closing Date, the Agent
has, in its reasonable discretion, approved such removal in writing; or (B) the
Borrowing Base Asset Value attributable to the Borrowing Base Asset(s) proposed
for removal, plus the Borrowing Base Asset Values attributable to all other
such assets that have been removed during the previous twelve (12) calendar
months or that have been approved for removal pursuant to the terms hereof
during such period (and which the Borrower still intends to remove from the
Borrowing Base calculation) is greater than ten percent (10.0%) of the
aggregate Borrowing Base Asset Value, as determined as of the Closing Date, the
Agent and the Required Lenders have approved such removal in writing; provided,
however, that to the extent the Borrowing Base Asset Value attributable to the
Borrowing Base Asset(s) proposed for removal, plus the Borrowing Base Asset Values
attributable to all other such assets that have been removed during the term
hereof or that have been approved for removal pursuant to the terms hereof
during such period (and which the Borrower still intends to remove from the
Borrowing Base calculation) is greater than twenty percent (20.0%) of the
aggregate Borrowing Base Asset Value, as determined as of the Closing Date,
such removal shall, in any case, require the written approval of the Agent and
the Required Lenders.

 

60

 

(b)           Commencing
as of the date on which the obligations under the Revolving Credit Documents
are Fully Satisfied and continuing for a period of ninety (90) days thereafter,
the Credit Parties shall be permitted to remove Borrowing Base Assets from
qualification as such without further approval from the Agent or the Required
Lenders upon delivery to the Agent of a Pro Forma Compliance Certificate
demonstrating that, upon giving effect to such removal, on a Pro Forma Basis,
the Credit Parties shall be in compliance with all of the Financial Covenants
contained herein; provided, that Agent does not dispute any of the amounts or
calculations set forth in such Pro Forma Compliance Certificate.

 

(c)           Commencing
as of the date occurring ninety (90) days following the date on which the
obligations under the Revolving Credit Documents are Fully Satisfied, and
notwithstanding anything to the contrary contained herein, no Credit Party
shall, at any time, seek to otherwise voluntarily remove or permit to be
removed any Borrowing Base Assets from qualification as such (whether in
anticipation of the Disposition or encumbrance thereof or otherwise), unless
(i) the Borrower shall have delivered to the Agent (and, to the extent such
removal shall require Required Lender approval, the Required Lenders) at least
twenty (20) Business Days prior to the effective date of such removal, a Pro
Forma Compliance Certificate demonstrating that, upon giving effect to such
removal, on a Pro Forma Basis, the Credit Parties shall be in compliance with
all of the Financial Covenants contained herein and (ii) to the extent (A) the
Borrowing Base Asset Value attributable to the Borrowing Base Asset(s) proposed
for removal, plus the Borrowing Base Asset Values attributable to all other
such assets that have been removed during the previous twelve (12) calendar
months (or, if shorter the period commencing as of the date occurring ninety
(90) days following the date on which the obligations under the Revolving
Credit Documents are Fully Satisfied and extending through the date of the
request for removal) or that have been approved for removal pursuant to the
terms hereof during such period (and which the Borrower still intends to remove
from the Borrowing Base calculation) is less than ten percent (10.0%) of the
aggregate Borrowing Base Asset Value, as determined as of the date occurring
ninety (90) days following the date on which the obligations under the
Revolving Credit Documents are Fully Satisfied, the Agent has, in its reasonable
discretion, approved such removal in writing; or (B) the Borrowing Base Asset
Value attributable to the Borrowing Base Asset(s) proposed for removal, plus
the Borrowing Base Asset Values attributable to all other such assets that have
been removed during the previous twelve (12) calendar months (or, if shorter
the period commencing as of the date occurring ninety (90) days following the
date on which the obligations under the Revolving Credit Documents are Fully
Satisfied and extending through the date of the request for removal) or that
have been approved for removal pursuant to the terms hereof during such period
(and which the Borrower still intends to remove from the Borrowing Base
calculation) is greater than ten percent (10.0%) of the aggregate Borrowing
Base Asset Value, as determined as of the date occurring ninety (90) days
following the date on which the obligations under the Revolving Credit
Documents are Fully Satisfied, the Agent and the Required Lenders have approved
such removal in writing; provided, however, that to the extent the Borrowing
Base Asset Value attributable to the Borrowing Base Asset(s) proposed for
removal, plus the Borrowing Base Asset Values attributable to all other such
assets that have been removed during the period commencing as of the date
occurring ninety (90) days following the date on which the obligations under
the Revolving Credit Documents are Fully Satisfied and extending through the
date of such requested removal or that have been approved for removal pursuant
to the terms hereof during such period (and which the Borrower still intends to
remove from the Borrowing Base calculation) is greater than twenty percent
(20.0%) of the aggregate Borrowing Base Asset Value, as determined as of the
date occurring ninety (90) days following the date on which the obligations
under the Revolving Credit Documents are Fully Satisfied, such removal shall,
in any case, require the written approval of the Agent and the Required
Lenders.

 

(d)           All approvals or rejections of
removal requests delivered by the Borrower to the Agent and/or Required Lenders
hereunder shall be delivered by the Agent and/or the Required Lenders, as
applicable, within fifteen (15) days of their receipt thereof or shall be
deemed to be an approval of such request.  Following
the date on which the obligations under the Revolving Credit Documents are
Fully Satisfied, the Credit Parties shall be permitted to remove Borrowing Base
Assets from qualification as such to the extent the Borrowing Base, at all
times, exceeds the outstanding principal balance of the Term Loans.

 

8.15        Negative Pledges/Liens.

 

Notwithstanding anything
contained herein or in any other Credit Document to the contrary:

 

61

 

(a)           none
of the Consolidated Parties shall, at any time, enter into, assume or become
subject to any Negative Pledge on their Property prohibiting or otherwise
restricting the existence of any Lien upon any of its Property in favor of the
Agent (for the benefit of the Lenders) for the purpose of securing the Credit
Party Obligations, except (i) in connection with any document or instrument
governing Indebtedness incurred in accordance with Section 8.1(c);
provided, that any such restriction contained therein relates only to the asset
or assets constructed or acquired in connection therewith, (ii) in connection
with any Permitted Lien or any document or instrument governing any Permitted
Lien, provided, that any such restriction contained therein relates only to the
asset or assets subject to such Permitted Lien, (iii) pursuant to customary
restrictions and conditions contained in any agreement relating to the sale of
any Property permitted under Section 8.5, pending the consummation of such
sale and (iv) with respect to USRP (Bob), LLC, USRP (Hawaii), LLC and Fuel
Supply, Inc., pursuant to the terms of the Hawaii Loan Documents;

 

(b)           none
of the Consolidated Parties shall, at any time, pledge or otherwise encumber
(except in connection herewith or with any of the Credit Documents) any income
derived from any of the assets contributing to the calculation of Borrowing
Base Asset Value;

 

(c)           the
General SPE shall not, at any time, contract, create, incur, assume or permit
to exist any Lien with respect to any of its assets except to the extent such
Liens are of the types described in Sections 8.2(a), (b), (c), (d), (e), (f),
(h) and (i);

 

(d)           the General SPE shall  not, in any case, incur any
Indebtedness or Contingent Obligations aside from Indebtedness and/or
Contingent Obligations arising in connection with the Credit Documents and
Indebtedness and/or Contingent Obligations of the type described in Section
8.1(e);

 

(e)           USRP
Operating shall not, at any time, contract, create, incur, assume or permit to
exist any Lien on its ownership interests in the General SPE or on the income
derived therefrom (except to the extent such Liens arise in connection with the
Credit Documents);

 

(f)            S&C shall not, at any time,
contract, create, incur, assume or permit to exist any Lien with respect to any
of its assets except to the extent such Liens are of the types described in
Sections 8.2(a), (b), (c), (d), (e), (f), (h) and (i);

 

(g)           S&C shall  not, in any case, incur any Indebtedness or Contingent
Obligations aside from Indebtedness and/or Contingent Obligations arising in
connection with the Credit Documents and Indebtedness and/or Contingent
Obligations of the type described in Section 8.1(e);

 

(h)           USRP Holding shall not, at any time,
contract, create, incur, assume or permit to exist any Lien on its ownership
interests in S&C or on the income derived therefrom (except to the extent
such Liens arise in connection with the Credit Documents);

 

(i)            HCI and its Wholly Owned
Subsidiaries shall not, at any time, contract, create, incur, assume or permit
to exist any Lien with respect to any of its assets except to the extent such
Liens are of the types described in Sections 8.2(a), (b), (c), (d), (e), (f),
(h) and (i);

 

(j)            HCI  and its Wholly Owned Subsidiaries shall  not, in any case, incur any Indebtedness or Contingent
Obligations aside from Indebtedness and/or Contingent Obligations arising in
connection with the Credit Documents and Indebtedness and/or Contingent
Obligations of the type described in Section 8.1(e);

 

(k)           JVI shall not, at any time, contract,
create, incur, assume or permit to exist any Lien on its ownership interests in
HCI or on the income derived therefrom (except to the extent such Liens arise
in connection with the Credit Documents);

 

(l)            JV1 and its Wholly Owned
Subsidiaries shall not, at any time, contract, create, incur, assume or permit
to exist any Lien with respect to any of its assets except to the extent such
Liens are of the types described in Sections 8.2(a), (b), (c), (d), (e), (f),
(h) and (i);

 

62

 

(m)          JV1and its Wholly Owned Subsidiaries shall  not,
in any case, incur any Indebtedness or Contingent Obligations aside from
Indebtedness and/or Contingent Obligations arising in connection with the
Credit Documents and Indebtedness and/or Contingent Obligations of the type
described in Section 8.1(e); and

 

(n)           USRP Operating shall not, at any
time, contract, create, incur, assume or permit to exist any Lien on its
ownership interests in JV1 or on the income derived therefrom (except to the
extent such Liens arise in connection with the Credit Documents).

 

8.16        Operating Lease Obligations.

 

The Credit Parties
will not permit any Consolidated Party to enter into, assume or permit to exist
any obligations for the payment of rental under Operating Leases (excluding
Ground Lease Interests) which in the aggregate for all such Persons would
exceed $1,000,000 in any fiscal year.

 

8.17        No Foreign Subsidiaries.

 

The Credit Parties
will not create, acquire or permit to exist any Foreign Subsidiary.

 

8.18        Ground Leases.

 

For
all leases executed following the Closing Date, the USRP REIT, the General
Partner and the Borrower shall, and shall not permit any other Consolidated
Subsidiary to, lease as lessee any real property pursuant to a ground lease
unless such ground lease contains customary provisions protective of any lender
to the lessee which provisions do not vary in any material respect from those
required under the Borrower’s standard underwriting procedures and policies.

 

8.19        ERISA Exemptions.

 

The USRP REIT, the General Partner and the Borrower shall not, and shall
not permit any other Consolidated Subsidiary to, permit any of its respective
assets to become or be deemed to be “plan assets” within the meaning of ERISA,
the Code and the respective regulations promulgated thereunder.

 

8.20        Transfer of Assets to Non-Guarantor
Subsidiaries and Affiliates.

 

The USRP REIT, the General Partner and the Borrower shall not, and shall
not permit any other Consolidated Subsidiary to, transfer any of their
respective assets to any of their respective Subsidiaries or Affiliates except
(a) to the extent the applicable Subsidiary or Affiliate has, at the time of
such transfer, executed a Joinder Agreement and is a Guarantor hereunder or (b)
pursuant to the terms of the collateral substitution provisions of the 2001-A
Term Securitization Documents.

 

8.21        Revolving Credit Document Covenants
and Amendments.

 

Borrower shall not
violate any of the covenants, terms or conditions set forth in the Revolving
Credit Documents (except to the extent such covenants, terms or conditions are
waived in accordance with the terms thereof) or otherwise permit to exist any
“Event of Default” (as defined in the Revolving Credit Agreement) to occur at
any time during the term of this Credit Agreement.

 

63

 

ARTICLE IX

EVENTS OF DEFAULT

 

9.1          Events of Default.

 

An Event of
Default shall exist upon the occurrence and during the continuance of any of
the following specified events (each an “Event of Default”):

 

(a)           Payment.  Any Credit Party shall

 

(i)            default in the payment when due of
any principal of any of the Loans, or

 

(ii)           default,
and such default shall continue for three (3) or more Business Days, in
the payment when due of any interest on the Loans or of any Fees or other
amounts owing hereunder, under any of the other Credit Documents or in
connection herewith or therewith; or

 

(b)           Representations.  Any representation, warranty or statement
made or deemed to be made by any Credit Party herein, in any of the other
Credit Documents, or in any statement or certificate delivered or required to
be delivered pursuant hereto or thereto shall prove untrue in any material
respect on the date as of which it was deemed to have been made; or

 

(c)           Covenants.  Any Credit Party shall

 

(i)            default
in the due performance or observance of any term, covenant or agreement
contained in Sections 7.2, 7.9, 7.11 or 7.12 or Section 8;

 

(ii)           default
in the due performance or observance of any term, covenant or agreement
contained in Sections 7.1(a), (b), (c) or (k) or either of Sections 7.10
or 7.14 and such default shall continue unremedied for a period of at least 5
days after the earlier of an Executive Officer of a Credit Party becoming aware
of such default or notice thereof by the Agent; or

 

(iii)          default
in the due performance or observance by it of any term, covenant or agreement
(other than those referred to in subsections (a), (b), (c)(i) or (c)(ii)
of this Section 9.1) contained in this Credit Agreement or any other
Credit Document and such default shall continue unremedied for a period of at
least 30 days after the earlier of an Executive Officer of a Credit Party
becoming aware of such default or notice thereof by the Agent; or

 

(d)           Other
Credit Documents.  Except as a
result of or in connection with a dissolution, merger or disposition of a
Subsidiary not prohibited by Section 8.4 or Section 8.5, any Credit
Document shall fail to be in full force and effect or to give the Agent and/or
the Lenders the Liens, rights, powers and privileges purported to be created
thereby, or any Credit Party shall so state in writing; or

 

(e)           Guaranties.  Except as the result of or in connection
with (i) a dissolution, merger or disposition of a Subsidiary not prohibited by
Section 8.4 or Section 8.5 or (ii) a release specifically provided
for in Section 4.8, the guaranty given by any Guarantor hereunder
(including any Person after the Closing Date in accordance with
Section 7.12) or any provision thereof shall cease to be in full force and
effect, or any Guarantor (including any Person after the Closing Date in
accordance with Section 7.12) hereunder or any Person acting by or on
behalf of such Guarantor shall deny or disaffirm such Guarantor’s obligations
under such guaranty, or any Guarantor shall default in the due performance or
observance of any term, covenant or agreement on its part to be performed or
observed pursuant to any guaranty; or

 

(f)            Bankruptcy,
etc.  Any Bankruptcy Event shall
occur with respect to the Borrower, the General Partner or any other
Consolidated Party; or

 

64

 

(g)           Challenge of Credit Documents.  The Borrower or any Guarantor shall disavow,
revoke or terminate or attempt to do any of the foregoing with respect to any
Credit 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 any Credit Document; or

 

(h)           Defaults
under Other Agreements.

 

(i)            Any
Consolidated Party shall default in the performance or observance (beyond the
applicable grace period with respect thereto, if any) of any material
obligation or condition of any contract or lease material to the Consolidated
Parties taken as a whole if such default could reasonably be expected to have a
Material Adverse Effect; or

 

(ii)           With
respect to Indebtedness (other than Indebtedness outstanding under this Credit
Agreement) in excess of $5,000,000 in the aggregate (for the Consolidated
Parties taken as a whole), (A) either (1) a default in any payment
shall occur and continue (beyond the applicable grace period with respect
thereto, if any) with respect to any such Indebtedness, (2) a default in the
observance or performance relating to such Indebtedness or contained in any
instrument or agreement evidencing, securing or relating thereto and such
default is not cured within the applicable grace period, if any, or  (3) any event or condition shall occur or
exist, the effect of which event or condition is to cause, or permit, the
holder or holders of such Indebtedness (or trustee or agent on behalf of such
holders) to cause any such Indebtedness to become due prior to its stated
maturity; or (B) any such Indebtedness shall be declared due and payable,
or required to be prepaid other than by a regularly scheduled required
prepayment, prior to the stated maturity thereof; or

 

(i)            Judgments.  One or more judgments or decrees shall be
entered against one or more of the Consolidated Parties involving a liability
of $1,000,000 or more in the aggregate (to the extent not paid or fully covered
by insurance provided by a carrier who has acknowledged coverage and has the
ability to perform) and any such judgments or decrees shall not have been
vacated, discharged or stayed or bonded pending appeal within 30 days from the
entry thereof; or

 

(j)            ERISA.  Any of the following events or conditions,
if such event or condition could involve possible taxes, penalties, and other
liabilities in an aggregate amount in excess of $1,000,000:  (i) any “accumulated funding
deficiency,” as such term is defined in Section 302 of ERISA and
Section 412 of the Code, whether or not waived, shall exist with respect
to any Plan, or any lien shall arise on the assets of any Consolidated Party or
any ERISA Affiliate in favor of the PBGC or a Plan; (ii) an ERISA Event
shall occur with respect to a Single Employer Plan, which is, in the reasonable
opinion of the Agent, likely to result in the termination of such Plan for
purposes of Title IV of ERISA; (iii) an ERISA Event shall occur with
respect to a Multiemployer Plan or Multiple Employer Plan, which is, in the
reasonable opinion of the Agent, likely to result in (A) the termination
of such Plan for purposes of Title IV of ERISA, or (B) any
Consolidated Party or any ERISA Affiliate incurring any liability in connection
with a withdrawal from, reorganization of (within the meaning of
Section 4241 of ERISA), or insolvency (within the meaning of
Section 4245 of ERISA) of such Plan; or (iv) any prohibited
transaction (within the meaning of Section 406 of ERISA or
Section 4975 of the Code) or breach of fiduciary responsibility shall
occur which may subject any Consolidated Party or any ERISA Affiliate to any
liability under Sections 406, 409, 502(i), or 502(l) of ERISA or
Section 4975 of the Code, or under any agreement or other instrument
pursuant to which any Consolidated Party or any ERISA Affiliate has agreed or
is required to indemnify any person against any such liability; or

 

(k)           Ownership.  There shall occur a Change of Control; or

 

(l)            REIT
Status.  The USRP REIT shall, for
any reason, lose or fail to maintain its status as a REIT; or

 

(m)          Material
Adverse Effect.  The Borrower, the
General Partner, any Consolidated Party or any combination thereof shall
experience a change in financial condition that, in the reasonable opinion of
the Agent, has or will have a Material Adverse Effect; or

 

65

 

(n)           Disposition
of Assets.  The proceeds generated
from sales, conveyances and dispositions (whether such transactions are entered
into voluntarily or otherwise and exclusive of the cash proceeds generated by a
Term Securitization) of the assets of the Borrower, General Partner and their
Subsidiaries for the period commencing as of the Closing Date and extending
through any given date during the term hereof are, in the aggregate, greater
than an amount equal to (i) twenty-five percent (25.0%) multiplied by
(ii) Total Tangible Assets, as calculated as of the Closing Date; or

 

(o)           Material
Change in Management, Operations or Business.  There shall occur a Change in Management.

 

9.2          Acceleration; Remedies.

 

Subject to the
terms of the Intercreditor Agreement, upon the occurrence and during the
continuance of an Event of Default, the Agent may or, upon the request and
direction of the Required Term Loan Lenders, shall, by written notice to the
Credit Parties take any of the following actions:

 

(a)           Termination
of Commitments.  Declare the
Commitments terminated whereupon the Commitments shall be immediately
terminated.

 

(b)           Acceleration.  Declare the unpaid principal of and any
accrued interest in respect of all Loans and any and all other indebtedness or
obligations of any and every kind owing by the Credit Parties to the Agent
and/or any of the Lenders hereunder to be due whereupon the same shall be
immediately due and payable without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by the Credit Parties.

 

(c)           Enforcement
of Rights.  Enforce any and all
rights and interests created and existing under the Credit Documents including,
without limitation, all rights and remedies against any Guarantor and all
rights of set-off.

 

Notwithstanding
the foregoing, if an Event of Default specified in Section 9.1(f) shall
occur with respect to the Borrower, then, without the giving of any notice or
other action by the Agent or the Lenders, (i) the Commitments
automatically shall terminate and (ii) all of the outstanding Credit Party
Obligations automatically shall immediately become due and payable.

 

 

ARTICLE X

AGENCY PROVISIONS

 

10.1        Appointment, Powers and Immunities.

 

Each Lender hereby
irrevocably appoints and authorizes the Agent to act as its agent under this
Credit Agreement and the other Credit Documents with such powers and discretion
as are specifically delegated to the Agent by the terms of this Credit
Agreement and the other Credit Documents, together with such other powers as
are reasonably incidental thereto.  The
Agent (which term as used in this sentence and in Section 10.5 and the
first sentence of Section 10.6 hereof shall include its Affiliates and its
own and its Affiliates’ officers, directors, employees, and agents):  (a) shall not have any duties or
responsibilities except those expressly set forth in this Credit Agreement and
shall not be a trustee or fiduciary for any Lender; (b) shall not be
responsible to the Lenders for any recital, statement, representation, or
warranty (whether written or oral) made in or in connection with any Credit
Document or any certificate or other document referred to or provided for in,
or received by any of them under, any Credit Document, or for the value,
validity, effectiveness, genuineness, enforceability, or sufficiency of any
Credit Document, or any other document referred to or provided for therein or
for any failure by any Credit Party or any other Person to perform any of its
obligations thereunder; (c) shall not be responsible for or have any duty
to ascertain, inquire into, or verify the performance or observance of any
covenants or agreements by any Credit Party or the satisfaction of any
condition or to inspect the property (including the books and records) of any
Credit Party or any of its Subsidiaries or Affiliates; and (d) shall not
be responsible for any action taken or omitted

 

66

 

to be taken by it under
or in connection with any Credit Document, except for its own gross negligence
or willful misconduct.  The Agent may
employ agents and attorneys-in-fact and shall not be responsible for the
negligence or misconduct of any such agents or attorneys-in-fact selected by it
with reasonable care.

 

10.2        Reliance by Agent.

 

The Agent shall be
entitled to rely upon any certification, notice, instrument, writing, or other
communication (including, without limitation, any thereof by telephone or
telecopy) believed by it to be genuine and correct and to have been signed,
sent or made by or on behalf of the proper Person or Persons, and upon advice
and statements of legal counsel (including counsel for any Credit Party),
independent accountants, and other experts selected by the Agent.  The Agent may deem and treat the payee of
any Note as the holder thereof for all purposes hereof unless and until the
Agent receives and accepts an Assignment and Assumption executed in accordance
with Section 11.3(b) hereof.  As to
any matters not expressly provided for by this Credit Agreement, 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 Required Term
Loan Lenders, and such instructions shall be binding on all of the Lenders; provided,
however, that the Agent shall not be required to take any action that
exposes the Agent to personal liability or that is contrary to any Credit
Document or applicable law or unless it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking any such action.

 

10.3        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 written notice from a Lender or a
Credit Party specifying such Default or Event of Default and stating that such
notice is a “Notice of Default”.  In the
event that the Agent receives such a notice of the occurrence of a Default or
Event of Default, the Agent shall give prompt notice thereof to the
Lenders.  The Agent shall (subject to
Section 10.2 hereof and the terms of the Intercreditor Agreement) take
such action with respect to such Default or Event of Default as shall
reasonably be directed by the Required Term Loan Lenders (or such other Lenders
as required by Section 11.6), provided  that, unless and
until the Agent shall have received such directions, the Agent may (but shall
not be obligated to) take such action, or refrain from taking such action, with
respect to such Default or Event of Default as it shall deem advisable in the
best interest of the Lenders (subject to the terms of the Intercreditor
Agreement).

 

10.4        Rights as a Lender.

 

With respect to its
Commitment and the Loans made by it, BOA (and any successor acting as Agent) in
its capacity as a Lender hereunder shall have the same rights and powers
hereunder as any other Lender and may exercise the same as though it were not
acting as the Agent, and the term “Lender” or “Lenders” shall, unless the
context otherwise indicates, include the Agent in its individual capacity.  BOA (and any successor acting as Agent) and
its Affiliates may (without having to account therefor to any Lender) accept
deposits from, lend money to, make investments in, provide services to, and
generally engage in any kind of lending, trust, or other business with any
Credit Party or any of its Subsidiaries or Affiliates as if it were not acting
as Agent, and BOA (and any successor acting as Agent) and its Affiliates may
accept fees and other consideration from any Credit Party or any of its
Subsidiaries or Affiliates for services in connection with this Credit
Agreement or otherwise without having to account for the same to the Lenders.

 

10.5        Indemnification.

 

The Lenders agree
to indemnify the Agent (to the extent not reimbursed under Section 11.5
hereof, but without limiting the obligations of the Credit Parties under such
Section) ratably (in accordance with their respective outstanding Term Loan)
for any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses (including attorneys’ fees), or disbursements
of any kind and nature whatsoever that may be imposed on, incurred by or asserted
against the Agent (including by any Lender) in any way relating to or arising
out of any Credit Document or the transactions contemplated thereby or any
action taken or omitted by the Agent under any Credit Document; provided
that no Lender shall be liable for any of the foregoing to the extent they
arise from the gross negligence or willful misconduct of the Person to be
indemnified.  Without limitation of the
foregoing,

 

67

 

each Lender agrees to reimburse the Agent promptly upon demand for its
ratable share of any costs or expenses payable by the Credit Parties under
Section 11.5, to the extent that the Agent is not promptly reimbursed for
such costs and expenses by the Credit Parties. 
The agreements in this Section 10.5 shall survive the repayment of
the Loans and other obligations under the Credit Documents.

 

10.6        Non-Reliance on Agent and Other
Lenders.

 

Each Lender agrees
that it has, independently and without reliance on the Agent or any other Lender,
and based on such documents and information as it has deemed appropriate, made
its own credit analysis of the Credit Parties and their Subsidiaries and
decision to enter into this Credit Agreement and that it will, independently
and without reliance upon the Agent or any other Lender, and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own analysis and decisions in taking or not taking action under the
Credit Documents.  Except for notices,
reports, and other documents and information expressly required to be furnished
to the Lenders by the Agent hereunder, the Agent shall not have any duty or
responsibility to provide any Lender with any credit or other information
concerning the affairs, financial condition, or business of any Credit Party or
any of its Subsidiaries or Affiliates that may come into the possession of the
Agent or any of its Affiliates.

 

10.7        Successor Agent.

 

The Agent may
resign at any time by giving notice thereof to the Lenders and the Credit
Parties.  Upon any such resignation, the
Required Term Loan Lenders shall have the right to appoint a successor
Agent.  If no successor Agent shall have
been so appointed by the Required Term Loan Lenders and shall have accepted
such appointment within thirty (30) days after the retiring Agent’s giving
of notice of resignation, then the retiring Agent may, on behalf of the
Lenders, appoint a successor Agent which shall be a commercial bank organized
under the laws of the United States having combined capital and surplus of at
least $100,000,000.  Upon the acceptance
of any appointment as Agent hereunder by a successor, such successor shall
thereupon succeed to and become vested with all the rights, powers, discretion,
privileges, and duties of the retiring Agent, and the retiring Agent shall be
discharged from its duties and obligations hereunder.  After any retiring Agent’s resignation hereunder as Agent, the
provisions of this Section 10 shall continue in effect for its benefit in
respect of any actions taken or omitted to be taken by it while it was acting
as Agent.  If no successor Agent has
accepted appointment as Agent under this Credit Agreement by the date which is
30 days following a retiring Agent’s notice of resignation, the retiring
Agent’s resignation shall nevertheless thereupon become effective and the
Lenders shall perform all the duties of the Agent hereunder until such time, if
any, as the Required Lenders appoint a successor agent as provided for above.

 

ARTICLE XI

MISCELLANEOUS

 

11.1        Notices.

 

Except as
otherwise expressly provided herein, all notices and other communications shall
have been duly given and shall be effective (a) when delivered,
(b) when transmitted via telecopy (or other facsimile device) to the
number set out below, (c) the Business Day following the day on which the
same has been delivered prepaid (or
pursuant to an invoice arrangement) to a reputable national overnight
air courier service, or (d) the third Business Day following the day on
which the same is sent by certified or registered mail, postage prepaid, in
each case to the respective parties at the address, in the case of the Credit
Parties and the Agent, set forth below, and, in the case of the Lenders, set
forth on Schedule 2.1(a), or at such other address as such party
may specify by written notice to the other parties hereto:

 

	
   

  	
  if to any Credit Party:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  U.S.  Restaurant Properties Operating, L.P.

  
	
   

  	
   

  	
  c/o
  U.S. Restaurant Properties, Inc.

  
	
   

  	
   

  	
  12240
  Inwood Road, Suite 300

  
	
   

  	
   

  	
  Dallas,
  TX 75244

  
	
   

  	
   

  	
  Attn:  Stacy M. Riffe, CFO

  

 

68

 

	
   

  	
   

  	
  Telephone:
  (972) 387-1487, ext 112

  
	
   

  	
   

  	
  Telecopy:
  (972) 490-9119

  
	
   

  	
   

  	
   

  
	
   

  	
  if to the Agent (for
  credit-related matters):

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Bank
  of America, N.A.

  
	
   

  	
   

  	
  231
  South LaSalle Street

  
	
   

  	
   

  	
  M/C:  IL1-231-10-35

  
	
   

  	
   

  	
  Chicago,
  IL  60697

  
	
   

  	
   

  	
  Attention:
  Matthew W. Sadler, Vice President, Global Portfolio Management, Real Estate

  
	
   

  	
   

  	
  Phone:  (312) 828-7107

  
	
   

  	
   

  	
  Fax:  (312) 974-4970

  
	
   

  	
   

  	
  E-mail:  matthew.w.sadler@bankofamerica.com

  
	
   

  	
   

  	
   

  
	
   

  	
  and
  if to the Agent (for administrative matters):

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Bank
  of America, N.A.

  
	
   

  	
   

  	
  231
  South LaSalle Street

  
	
   

  	
   

  	
  Mail
  code:  IL1-231-10-30

  
	
   

  	
   

  	
  Chicago,
  IL 60697

  
	
   

  	
   

  	
  Attention: Charlene E. Wright-Jones, Assistant Vice
  President

  
	
   

  	
   

  	
  Phone:  312-828-4160

  
	
   

  	
   

  	
  Fax:  312-828-3950

  
	
   

  	
   

  	
  E-mail:  charlene.wright-jones@bankofamerica.com

  

 

11.2        Right of Set-Off; Adjustments.

 

Upon the occurrence and during the continuance of any
Event of Default, each Lender (and each of its Affiliates) is hereby authorized
(subject to the terms and conditions of the Intercreditor Agreement) at any
time and from time to time, to the fullest extent permitted by law, to set off
and apply any and all deposits (general or special, time or demand, provisional
or final) at any time held and other indebtedness at any time owing by such
Lender (or any of its Affiliates) to or for the credit or the account of any
Credit Party against any and all of the obligations of such Person now or
hereafter existing under this Credit Agreement, under the Notes, under any
other Credit Document or otherwise, irrespective of whether such Lender shall
have made any demand hereunder or thereunder and although such obligations may
be unmatured.  Each Lender agrees
promptly to notify any affected Credit Party after any such set-off and application
made by such Lender; provided, however, that the failure to give
such notice shall not affect the validity of such set-off and application.  The rights of each Lender under this
Section 11.2 are in addition to other rights and remedies (including, without
limitation, other rights of set-off) that such Lender may have.

 

11.3        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 assigns permitted hereby, except that the Borrower
may not assign or otherwise transfer any of its rights or obligations hereunder
without the prior written consent of each Lender and no Lender may assign or
otherwise transfer any of its rights or obligations hereunder except (i) to an
Eligible Assignee in accordance with the provisions of paragraph (b) of this
Section, (ii) by way of participation in accordance with the provisions of
paragraph (d) of this Section or (iii) by way of pledge or assignment of a
security interest subject to the restrictions of paragraph (f) of this Section
(and any other attempted assignment or transfer by any party hereto shall be
null and void).  Nothing in this
Agreement, expressed or implied, shall be construed to confer upon any Person (other
than the parties hereto, their respective successors and assigns permitted
hereby, Participants to the extent provided in paragraph (d) of this Section
and, to the extent expressly contemplated hereby, the Related Parties of each
of the Agent and the Lenders) any legal or equitable right, remedy or claim
under or by reason of this Agreement.

 

69

 

(b)           Any Lender may at any time assign to
one or more Eligible Assignees all or a portion of its rights and obligations
under this Agreement (including all or a portion of its Loans at the time owing
to it); provided that (i) except in the case of an assignment of the
entire remaining amount of the assigning Lender’s Loans at the time owing to it
or in the case of an assignment to a Lender or an Affiliate of a Lender or an
Approved Fund with respect to a Lender, the aggregate amount of the principal
outstanding balance of the Loan of the assigning Lender subject to each such
assignment (determined as of the date the Assignment and Assumption with
respect to such assignment is delivered to the Agent or, if “Trade Date” is
specified in the Assignment and Assumption, as of the Trade Date) shall not be
less than $2,500,000, unless each of the Agent and, so long as no default or
Event of Default has occurred and is continuing hereunder or any other Credit
Document, the Borrower otherwise consent (each such consent not to be
unreasonably withheld or delayed); (ii) each partial assignment shall be made
as an assignment of a proportionate part of all the assigning Lender’s rights
and obligations under this Agreement with respect to the Loan assigned; (iii)
any assignment Loans must be approved by the Agent unless the Person that is
the proposed assignee is itself a Lender with holding a Loan (whether or not
the proposed assignee would otherwise qualify as an Eligible Assignee); and
(iv) the parties to each assignment shall execute and deliver to the Agent an
Assignment and Assumption and an ICA Joinder Agreement, together with a
processing and recordation fee of $3,500, and the Eligible Assignee, if it shall
not be a Lender, shall deliver to the Agent an Administrative
Questionnaire.  Subject to acceptance
and recording thereof by the Agent pursuant to paragraph (c) of this Section,
from and after the effective date specified in each Assignment and Assumption,
the Eligible Assignee thereunder shall be a party to this Agreement and, to the
extent of the interest assigned by such Assignment and Assumption, have the
rights and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Assumption, be released from its obligations under this
Agreement (and, in the case of an Assignment and Assumption covering all of the
assigning Lender’s rights and obligations under this Agreement, such Lender
shall cease to be a party hereto) but shall continue to be entitled to the
benefits of Sections 3.6 through 3.12  with respect to facts and circumstances
occurring prior to the effective date of such assignment.  Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with this
paragraph shall be treated for purposes of this Agreement as a sale by such Lender
of a participation in such rights and obligations in accordance with paragraph
(d) of this Section.

 

(c)           The Agent, acting solely for this
purpose as an agent of the Borrower, shall maintain at one of its offices a
copy of each Assignment and Assumption delivered to it and a register for the
recordation of the names and addresses of the Lenders and the principal amounts
of the Loans owing to each Lender pursuant to the terms hereof from time to
time (the “Register”).  The
entries in the Register shall be conclusive, and the Borrower, the Agent and
the Lenders may treat each Person whose name is recorded in the Register
pursuant to the terms hereof as a Lender hereunder for all purposes of this
Agreement, notwithstanding notice to the contrary.  The Register shall be available for inspection by the Borrower
and any Lender, at any reasonable time and from time to time upon reasonable
prior notice.

 

(d)           Any Lender may at any time, without
the consent of, or notice to, the Borrower or the Agent, sell participations
(in minimum amounts of not less than $2,500,000) to any Person (other than a
natural person, the Borrower or any of the Credit Parties or any of the
Borrower’s or any Credit Party’s Affiliates or Subsidiaries) (each, a “Participant”)
in all or a portion of such Lender’s rights and/or obligations under this
Agreement (including all or a portion of the Loans owing to it); provided
that (i) such Lender’s obligations under this Agreement shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations and (iii) the
Borrower, the Agent and the other Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement.  Any
agreement or instrument pursuant to which a Lender sells such a participation
shall provide that such Lender shall retain the sole right to enforce this
Agreement and to approve any amendment, modification or waiver of any provision
of this Agreement; provided that such agreement or instrument may
provide that such Lender will not, without the consent of the Participant,
agree to any amendment, modification or waiver described in Section 11.6 that
affects such Participant.  Subject to
paragraph (e) of this Section, the Borrower agrees that each Participant shall
be entitled to the benefits of Sections 3.6 through 3.12  to the same extent as if it
were a Lender and had acquired its interest by assignment pursuant to paragraph
(b) of this Section.  To the extent
permitted by law, each Participant also shall be entitled to the benefits of
Section 11.2 as though it were a Lender, provided such Participant agrees to be
subject to Sections 3.14 and 3.15 and the Intercreditor Agreement as though it were
a Lender.

 

70

 

(e)           A
Participant shall not be entitled to receive any greater payment under Sections
3.6 through 3.12  than the applicable Lender would have been entitled to
receive with respect to the participation sold to such Participant, unless the
sale of the participation to such Participant is made with the Borrower’s prior
written consent.  A Participant that
would be a Foreign Lender if it were a Lender shall not be entitled to the
benefits of Section 3.11 unless the Borrower is notified of the
participation sold to such Participant and such Participant agrees, for the
benefit of the Borrower, to comply with Section 3.11 as though it were a
Lender.

 

(f)            Any
Lender may at any time pledge or assign a security interest in all or any
portion of its rights under this Agreement to secure obligations of such
Lender, including without limitation any pledge or assignment to secure
obligations to a Federal Reserve Bank; provided that no such pledge or
assignment shall release such Lender from any of its obligations hereunder or
substitute any such pledgee or assignee for such Lender as a party hereto.

 

11.4        No Waiver; Remedies Cumulative.

 

No failure or
delay on the part of the Agent or any Lender in exercising any right, power or
privilege hereunder or under any other Credit Document and no course of dealing
between the Agent or any Lender and any of the Credit Parties shall operate as
a waiver thereof; nor shall any single or partial exercise of any right, power
or privilege hereunder or under any other Credit Document preclude any other or
further exercise thereof or the exercise of any other right, power or privilege
hereunder or thereunder.  The rights and
remedies provided herein are cumulative and not exclusive of any rights or
remedies which the Agent or any Lender would otherwise have.  No notice to or demand on any Credit Party
in any case shall entitle the Credit Parties to any other or further notice or
demand in similar or other circumstances or constitute a waiver of the rights
of the Agent or the Lenders to any other or further action in any circumstances
without notice or demand.

 

11.5        Expenses; Indemnification.

 

(a)           The Credit Parties jointly and
severally agree to pay on demand all costs and expenses of the Agent in
connection with the syndication, preparation, execution, delivery,
administration, modification, and amendment of this Credit Agreement, the other
Credit Documents, and the other documents to be delivered hereunder, including,
without limitation, the reasonable fees and expenses of counsel for the Agent
(including the cost of internal counsel) with respect thereto and with respect
to advising the Agent as to its rights and responsibilities under the Credit
Documents.  The Credit Parties further
jointly and severally agree to pay on demand all costs and expenses of the
Agent and the Lenders, if any (including, without limitation, reasonable
attorneys’ fees and expenses and the cost of internal counsel), in connection
with any work-out or restructuring relating to the Credit Facility or any
enforcement (whether through negotiations, legal proceedings, or otherwise) of
any of the Credit Documents.

 

(b)           The Credit Parties jointly and
severally agree to indemnify and hold harmless the Agent and each Lender and
each of their Affiliates and their respective officers, directors, employees,
agents, and advisors (each, an “Indemnified Party”) from and against any
and all claims, damages, losses, liabilities, costs, and expenses (including,
without limitation, reasonable attorneys’ fees) that may be incurred by or
asserted or awarded against any Indemnified Party, in each case arising out of
or in connection with or by reason of (including, without limitation, in
connection with any investigation, litigation, or proceeding or preparation of
defense in connection therewith) the Credit Documents, any of the transactions
contemplated herein or the actual or proposed use of the proceeds of the Loans,
except to the extent such claim, damage, loss, liability, cost, or expense is
found in a final, non-appealable judgment by a court of competent jurisdiction
to have resulted from such Indemnified Party’s gross negligence or willful
misconduct.  In the case of an investigation,
litigation or other proceeding to which the indemnity in this Section 11.5
applies, such indemnity shall be effective whether or not such investigation,
litigation or proceeding is brought by any of the Credit Parties, their
respective directors, shareholders or creditors or an Indemnified Party or any
other Person or any Indemnified Party is otherwise a party thereto and whether
or not the transactions contemplated hereby are consummated.  The Credit Parties agree not to assert any
claim against the Agent, any Lender, any of their Affiliates, or any of their
respective directors, officers, employees, attorneys, agents, and advisers, on
any theory of liability, for special, indirect, consequential, or punitive
damages

 

71

 

arising out of or otherwise relating to the Credit
Documents, any of the transactions contemplated herein or the actual or
proposed use of the proceeds of the Loans.

 

(c)           Without prejudice to the survival of
any other agreement of the Credit Parties hereunder, the agreements and
obligations of the Credit Parties contained in this Section 11.5 shall
survive the repayment of the Loans and other obligations under the Credit
Documents.

 

11.6        Amendments, Waivers and Consents.

 

(a)           Neither this Credit Agreement nor any
other Credit Document nor any of the terms hereof or thereof may be amended,
deleted or otherwise changed unless such amendment, deletion or change is in
writing entered into by, or approved in writing by, each of the Credit Parties
party thereto and the Required Lenders, provided, however, that:

 

(i)            without the consent of each Lender
affected thereby (in addition to Required Lender consent), neither this Credit
Agreement nor any other Credit Document may be amended, deleted or otherwise
changed so as to:

 

(A)          extend any Commitment or the final
maturity of any Loan or extend any payment due (or to be due) in connection
with any Loan, or any portion thereof,

 

(B)           reduce the rate or extend the time of
payment of interest on any Loan (subject to the right of the Required Revolving
Lenders to waive the applicability of any post-default increase in interest
rates pursuant to Section 11.6(b) below) or of any Fees,

 

(C)           reduce the principal amount of any
Loan,

 

(D)          increase the Commitment of a Lender
over the amount thereof in effect (it being understood and agreed that a waiver
of any condition precedent set forth in Section 5.2 or of any Default or
Event of Default or mandatory reduction in the Commitments shall not constitute
a change in the terms of any Commitment of any Lender),

 

(E)           except as the result of or in
connection with a dissolution, merger or disposition of a Consolidated Party
not prohibited by Section 8.4 or Section 8.5, release the Borrower or
substantially all of the other Credit Parties from its or their obligations
under the Credit Documents,

 

(F)           amend or modify any provision of this
Section 11.6,

 

(G)           reduce any percentage specified in,
or otherwise modify, the definition of Required Lenders or Required Term Loan
Lenders, or

 

(H)          consent to the assignment or transfer
by the Borrower or any of the other Credit Parties of all or substantially all
of their rights and obligations under (or in respect of) the Credit Documents
except as permitted thereby;

 

(ii)           without the consent of the Agent, no
provision of Section 10 may be amended, deleted or otherwise changed; and

 

(iii)          provisions contained in this Credit
Agreement and in the Credit Documents pertaining to purely ministerial or
administrative matters may be amended, deleted or otherwise changed upon the obtaining
of the written consent of the Credit Parties and Required Term Loan Lenders
(regardless of whether Required Lender consent is obtained) to the extend such
amendments, deletions and/or other changes do not, in the judgment of the
Collateral Agent, materially and adversely effect the rights, remedies or
expected financial return of the Revolving Lenders.

 

72

 

Notwithstanding
the fact that the consent of all the Lenders is required in certain circumstances
as set forth above, (x) each Lender is entitled to vote as such Lender
sees fit on any bankruptcy reorganization plan that affects the Loans, and each
Lender acknowledges that the provisions of Section 1126(c) of the
Bankruptcy Code supersedes the unanimous consent provisions set forth herein
and (y) the Required Lenders shall, subject to the terms of the
Intercreditor Agreement, determine whether or not to allow a Credit Party to
use cash collateral in the context of a bankruptcy or insolvency proceeding and
such determination shall be binding on all of the Lenders.

 

(b)           None
of the terms or conditions of this Credit Agreement or of any of the other
Credit Documents may be waived without the written consent of the Required Term
Loan Lenders; provided, however, that:

 

(i)            without the consent of each Lender
affected thereby, neither this Credit Agreement nor any other Credit Document
may be waived so as to (whether expressly or effectively):

 

(A)          extend
any Commitment or the final maturity of any Loan (provided, that any waiver
which has the effect of extending the final maturity of any Loan or any such
obligation shall constitute an amendment requiring approval pursuant to clause
(a) of this Section 11.6), or otherwise waive any payment due (or to be due) in
connection with any Loan, or any portion thereof,

 

(B)           reduce
the rate or extend the time of payment of interest on any Loan (other than as a
result of waiving the applicability of any post-default increase in interest
rates) or of any Fees,

 

(C)           waive
the principal amount of any Loan,

 

(D)          increase
the Commitment of a Lender over the amount thereof in effect (it being
understood and agreed that a waiver of any condition precedent set forth in
Section 5.2 or of any Default or Event of Default or mandatory reduction
in the Commitments shall not constitute a change in the terms of any Commitment
of any Lender),

 

(E)           except
as the result of or in connection with a dissolution, merger or disposition of
a Consolidated Party not prohibited by Section 8.4 or Section 8.5,
release the Borrower or substantially all of the other Credit Parties from its
or their obligations under the Credit Documents,

 

(F)           waive
any provision of this Section 11.6 (provided, that any such waiver shall,
for purposes hereof, constitute an amendment requiring approval pursuant to
clause (a) of this Section 11.6),

 

(G)           reduce
any percentage specified in, or otherwise modify, the definition of Required
Lenders or Required Term Loan Lenders (provided, that any waiver having such an
effect shall, for purposes hereof, constitute an amendment requiring approval
pursuant to clause (a) of this Section 11.6), or

 

(H)          consent
to the assignment or transfer by the Borrower or any of the other Credit
Parties of all or substantially all of their rights and obligations under (or
in respect of) the Credit Documents except as permitted thereby; and

 

(ii)           without
the consent of the Agent, no provision of Section 10 may be waived.

 

11.7        Counterparts.

 

This Credit
Agreement may be executed in any number of counterparts, each of which when so
executed shall be an original, but all of which shall constitute one and the
same instrument.  It shall not be
necessary in making proof of

 

73

 

this Credit Agreement to
produce or account for more than one such counterpart for each of the parties
hereto.  Delivery by facsimile by any of
the parties hereto of an executed counterpart of this Credit Agreement shall be
as effective as an original executed counterpart hereof and shall be deemed a
representation that an original executed counterpart hereof will be delivered.

 

11.8        Headings.

 

The headings of
the sections hereof are provided for convenience only and shall not in any way
affect the meaning or construction of any provision of this Credit Agreement.

 

11.9        Survival.

 

All indemnities
set forth herein, including, without limitation, in Section 2.2(i), 3.11,
3.12, 10.5 or 11.5 shall survive the execution and delivery of this Credit
Agreement, the making of the Loans, the repayment of the Loans and other
obligations under the Credit Documents, and all representations and warranties
made by the Credit Parties herein shall survive until this Credit Agreement
shall be terminated in accordance with the terms of Section 11.13(b).

 

11.10      Governing Law; Submission to
Jurisdiction; Venue.

 

(a)           THIS
CREDIT AGREEMENT AND, UNLESS OTHERWISE EXPRESSLY PROVIDED THEREIN, THE OTHER
CREDIT DOCUMENTS AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND
THEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NORTH CAROLINA. 
Any legal action or proceeding with respect to this Credit Agreement or
any other Credit Document may be brought in the courts of the State of North
Carolina in Mecklenburg County, or of the United States for the Western
District of North Carolina, and, by execution and delivery of this Credit
Agreement, each of the Credit Parties hereby irrevocably accepts for itself and
in respect of its property, generally and unconditionally, the nonexclusive
jurisdiction of such courts.  Each of
the Credit Parties further irrevocably consents to the service of process out
of any of the aforementioned courts in any such action or proceeding by the
mailing of copies thereof by registered or certified mail, postage prepaid, to
it at the address set out for notices pursuant to Section 11.1, such
service to become effective three (3) days after such mailing.  Nothing herein shall affect the right of the
Agent or any Lender to serve process in any other manner permitted by law or to
commence legal proceedings or to otherwise proceed against any Credit Party in
any other jurisdiction.

 

(b)           Each
of the Credit Parties hereby irrevocably waives any objection which it may now
or hereafter have to the laying of venue of any of the aforesaid actions or
proceedings arising out of or in connection with this Credit Agreement or any
other Credit Document brought in the courts referred to in subsection (a)
above and hereby further irrevocably waives and agrees not to plead or claim in
any such court that any such action or proceeding brought in any such court has
been brought in an inconvenient forum.

 

(c)           TO
THE EXTENT PERMITTED BY LAW, EACH OF THE AGENT, THE LENDERS, EACH OF THE CREDIT
PARTIES HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS CREDIT AGREEMENT,
ANY OF THE OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

11.11      Severability.

 

If any provision
of any of the Credit Documents is determined to be illegal, invalid or
unenforceable, such provision shall be fully severable and the remaining
provisions shall remain in full force and effect and shall be construed without
giving effect to the illegal, invalid or unenforceable provisions.

 

11.12      Entirety.

 

This Credit
Agreement together with the other Credit Documents represent the entire
agreement of the parties hereto and thereto, and supersede all prior agreements
and understandings, oral or written, if any, including any

 

74

 

commitment letters or
correspondence relating to the Credit Documents or the transactions
contemplated herein and therein.

 

11.13      Binding Effect; Termination.

 

(a)           This
Credit Agreement shall become effective at such time on or after the Closing
Date when it shall have been executed by each Credit Party and the Agent, and
the Agent shall have received copies hereof (telefaxed or otherwise) which,
when taken together, bear the signatures of each Lender, and thereafter this
Credit Agreement shall be binding upon and inure to the benefit of each Credit
Party, the Agent and each Lender and their respective successors and assigns.

 

(b)           The
term of this Credit Agreement shall be until the Credit Party Obligations are
Fully Satisfied.

 

11.14      Confidentiality.

 

Each Lender Party
agrees to maintain the confidentiality of the Information (as defined below),
except that Information may be disclosed (a) to its and its Affiliates’
directors, officers, employees and agents, including accountants, legal counsel
and other advisors (it being understood that the Persons to whom such
disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential), (b) to the
extent requested by any regulatory authority (including any self-regulatory
authority, such as the National Association of Insurance Commissioners), (c) to
the extent required by applicable laws or regulations or by any subpoena or similar
legal process, (d) to any other party hereto, (e) in connection with the
exercise of any remedies hereunder or under any other Credit Document or any
action or proceeding relating to this Agreement or any other Credit Document or
the enforcement of rights hereunder or thereunder, (f) subject to an agreement
containing provisions substantially the same as those of this Section, to (i)
any assignee of or Participant in, or any prospective assignee of or
Participant in, any of its rights or obligations under this Agreement or (ii)
any actual or prospective counterparty (or its advisors) to any swap or
derivative transaction relating to the Borrower and its obligations, (g) with
the consent of the Borrower or (h) 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 any Lender Party on a nonconfidential basis from a source other
than the Borrower.  For purposes of this
Section, “Information” means all information received from any Credit
Party relating to any Credit Party or any of their respective businesses, other
than any such information that is available to the Agent or any Lender on a
nonconfidential basis prior to disclosure by any Credit Party, provided that,
in the case of information received from a Credit Party after the date hereof,
such information is clearly identified at the time of delivery as
confidential.  Any Person required to
maintain the confidentiality of Information as provided in this Section shall
be considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential information.
Notwithstanding anything herein to the contrary, “Information” shall not
include, and the Borrower, the other Credit Parties, the Lender Parties and the
respective Affiliates of each of the foregoing (and the respective partners,
directors, officers, employees, agents, advisors and other representatives of
each of the foregoing and their Affiliates) may disclose to any and all
Persons, without limitation of any kind (a) any information with respect to the
U.S. federal and state income tax treatment of the transactions contemplated hereby
and any facts that may be relevant to understanding such tax treatment, which
facts shall not include for this purpose the names of the parties or any other
Person named herein, or information that would permit identification of the
parties or such other Persons, or any pricing terms or other nonpublic business
or financial information that is unrelated to such tax treatment or facts, and
(b) all materials of any kind (including opinions or other tax analyses)
relating to such tax treatment or facts that are provided to any of the Persons
referred to above.

 

11.15      Source of Funds.

 

Each of the
Lenders hereby represents and warrants to the Borrower that at least one of the
following statements is an accurate representation as to the source of funds to
be used by such Lender in connection with the financing hereunder:

 

75

 

(a)           no
part of such funds constitutes assets allocated to any separate account
maintained by such Lender in which any employee benefit plan (or its related
trust) has any interest;

 

(b)           to
the extent that any part of such funds constitutes assets allocated to any
separate account maintained by such Lender, such Lender has disclosed to the
Borrower the name of each employee benefit plan whose assets in such account
exceed 10% of the total assets of such account as of the date of such purchase
(and, for purposes of this clause (b), all employee benefit plans
maintained by the same employer or employee organization are deemed to be a
single plan);

 

(c)           to
the extent that any part of such funds constitutes assets of an insurance
company’s general account, such insurance company has complied with all of the
requirements of the regulations issued under Section 401(c)(1)(A) of
ERISA; or

 

(d)           such
funds constitute assets of one or more specific benefit plans which such Lender
has identified in writing to the Borrower.

 

As used in this
Section 11.15, the terms “employee benefit plan” and “separate account”
shall have the respective meanings assigned to such terms in Section 3 of
ERISA.

 

11.16      Regulation D.

 

Each of the
Lenders hereby represents and warrants to the Borrower that it is a commercial
lender, other financial institution or other “accredited” investor (as defined
in SEC Regulation D) which makes or acquires or loans on the ordinary
course of business and that it will make or acquire Loans for its own account
in the ordinary course of business.

 

11.17      Conflict.

 

To the extent that
there is a conflict or inconsistency between any provision hereof, on the one
hand, and any provision of any Credit Document, on the other hand, this Credit
Agreement shall control.

 

11.18      USA Patriot Act Notice.

 

Each Lender and
the Agent (for itself and not on behalf of any Lender) hereby notifies the
Borrower that pursuant to the requirements of the USA Patriot Act (Title III of
Pub. L. 107-56 (signed into law October 26, 2001)) (the “Act”), it is required
to obtain, verify and record information that identifies the Borrower, which
information includes the name and address of the Borrower and other information
that will allow such Lender or the Agent, as applicable, to identify the
Borrower in accordance with the Act.

 

[Remainder of Page
Left Intentionally Blank – Signature Pages, Schedules and Exhibits to
Follow]

 

76

 

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

 

 

	
  PRINCIPAL BORROWER:

  	
  U.S. RESTAURANT PROPERTIES OPERATING L.P.

  
	
   

  	
   

  
	
   

  	
  By:  USRP MANAGING, INC.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
  GENERAL SPE:

  	
  USRP FUNDING 2002-A, L.P.

  
	
   

  	
   

  
	
   

  	
  By:  USRP (SFGP) 2, LLC

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
  S&C:

  	
  USRP (S&C), LLC

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
  HCI:

  	
  USRP/HCI PARTNERSHIP 1, L.P.

  
	
   

  	
   

  
	
   

  	
  By:  USRP (JV1), LLC

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
  JV1:

  	
  USRP (JV1), LLC

  
	
   

  	
   

  
	
   

  	
  By:  USRP (JV1), LLC

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
  USRP Holding:

  	
  USRP HOLDING CORP.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
  GENERAL PARTNER:

  	
  USRP MANAGING, INC.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

 

	
  USRP REIT:

  	
  U.S. RESTAURANT PROPERTIES, INC.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
  SUBSIDIARY

  	
   

  
	
  GUARANTORS:

  	
  ARKANSAS RESTAURANTS #10, L.P., a Texas
  limited

  partnership

  
	
   

  	
   

  
	
   

  	
   

  	
  By: North American
  Restaurant Management, Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  RESTAURANT PROPERTY PARTNERS, L.P., a
  Texas

  limited partnership

  
	
   

  	
   

  
	
   

  	
   

  	
  By: Restaurant Funding,
  Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (66), LTD., a Texas limited
  partnership

  
	
   

  	
   

  
	
   

  	
   

  	
  By: USRP GP1, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (FAIN 10), L.P., a Texas limited
  partnership

  
	
   

  	
   

  
	
   

  	
   

  	
  By: USRP GP5, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (KATY), L.P., a Texas limited
  partnership

  
	
   

  	
   

  
	
   

  	
   

  	
  By: USRP GP8, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

 

	
   

  	
  USRP (PAC), L.P., a Texas limited
  partnership

  
	
   

  	
   

  
	
   

  	
   

  	
  By: USRP (Cap), Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (QUEST), L.P., a Texas limited
  partnership

  
	
   

  	
   

  
	
   

  	
   

  	
  By: USRP GP4, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (SAN ANTONIO), LTD., a Texas limited
  partnership

  
	
   

  	
   

  
	
   

  	
   

  	
  By: USRP GP, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (T&C), L.P., a Texas limited
  partnership

  
	
   

  	
   

  
	
   

  	
   

  	
  By: USRP GP3, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  BULLDOG MANAGEMENT, INC.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  NORTH AMERICAN RESTAURANT MANAGEMENT,

  INC.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  RESTAURANT FUNDING, INC.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

 

	
   

  	
  PINNACLE RESTAURANT GROUP, LLC, a Texas

  limited liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (ACQUISITION), LLC, a Texas limited
  liability

  company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (BC), LLC, a Texas limited liability
  company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (BILL), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (CAL), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (CAP), INC. a Texas corporation

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (CARROLL), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (CENTRAL AVENUE), LLC, a Texas
  limited

  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (CHRIS), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

 

	
   

  	
  USRP (DEEDEE), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (DON), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (FINANCE), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (FRED), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (GANT1), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (GANT2), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (GOLD), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP GP, LLC, a Texas limited liability
  company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP GP1, LLC, a Texas limited liability
  company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

 

	
   

  	
  USRP GP3, LLC, a Texas limited liability
  company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP GP4, LLC, a Texas limited liability
  company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP GP5, LLC, a Texas limited liability
  company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP GP6, LLC, a Texas limited liability
  company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP GP7, LLC, a Texas limited liability
  company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP GP8, LLC, a Texas limited liability
  company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (ILLINOIS), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (JENNIFER), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (JONES), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

 

	
   

  	
  USRP (JV2), LLC, a Texas limited
  liability company*

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (MANAGER), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (MIDON), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (MINNESOTA), LLC, a Texas limited
  liability

  company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (MISSOURI), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (MOLLY), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (PALMA), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (PAT), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

* NOTE – ALTHOUGH
INCLUDED IN THE EXECUTED SIGNATURE PAGES OF THE DOCUMENT, THE JV2 ENTITY HAS
BEEN DELETED AS A GUARANTOR – IT IS NOT A CONSOLIDATED PARTY AND WAS INCLUDED
BY THE BORROWER IN ITS LIST OF SUNSIDIARY GUARANTORS IN ERROR

 

 

 

	
   

  	
  USRP (POPEYE’S), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (RIBBIT), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (SARAH), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (ST. LOUIS), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (STEVE), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (SUSI), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (SYBRA), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (VALERIE), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

 

	
   

  	
  PINNACLE RESTAURANT GROUP II, LLC

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (CAROLINA), LTD.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  Restaurant
  Acquisition Corp.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (LINCOLN), LTD.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  Restaurant
  Acquisition Corp.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (NORMAN), LTD.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  Restaurant
  Acquisition Corp.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  U.S. RESTAURANT PROPERTIES DEVELOPMENT

  L.P.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  Restaurant
  Contractor Corp.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  RESTAURANT RENOVATION PARTNERS, L.P.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  Restaurant
  Acquisition Corp.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  RESTAURANT ACQUISITION CORP.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

 

	
   

  	
  RESTAURANT CONTRACTOR CORP.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP RENOVATION CORP.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (Green), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (Martin), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (SFGP)2, LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (SHOPORT)1, LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (Warren), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (KRUSE), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (PETERS), LLC, a Texas limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

 

	
   

  	
  USRP (ADAMS), L.P.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:  USRP GP7, LLC

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (Maier), L.P.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:  USRP GP6, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

 

	
   

  	
  USRP (SHO)1, L.P.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:  USRP (SHOPORT)1, LLC

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

[remainder of page
left intentionally blank – additional signature pages, schedules and exhibits
to follow]

 

 

 

	
  AGENT:

  	
   

  
	
   

  	
  BANK OF AMERICA, N.A., in its capacity as Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
						

 

 

	
  LENDERS:

  	
  BANK OF AMERICA, N.A.

  individually in its capacity as a

  Lender

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
						

 

 

 

Schedule 1.1(a)

Commitments

 

	
  Lender

  	
   

  	
  Commitment

  	
   

  	
  Commitment
  Percentage

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1. Bank of America,
  N.A.

  	
   

  	
  $

  	
  35,000,000

  	
   

  	
  100.00

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
   

  	
   

  	
   

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Totals:

  	
   

  	
  $

  	
   

  	
   

  	
  100.00

  	
  %

  

 

1

 

Schedule 2.1(a)

 

LENDER
ADDRESSES AND COMMITMENTS

 

 

Lender/Agent:

 

Bank of America,
N.A.

(for
credit-related matters):

 

Matthew W. Sadler

Vice President

Global Portfolio Management, Real Estate

Bank of America, N.A.

231 South LaSalle Street

M/C: 
IL1-231-10-35

Chicago, IL 
60697

Phone:  (312)
828-7107

Fax:  (312)
974-4970

E-mail:  matthew.w.sadler@bankofamerica.com

 

(for administrative matters):

 

Charlene E. Wright-Jones

Assistant Vice President

Bank of America, N.A.

231 South LaSalle Street

Mail code: 
IL1-231-10-30

Chicago, IL 60697

Phone: 
312-828-4160

Fax: 
312-828-3950

E-mail:  charlene.wright-jones@bankofamerica.com

 

Other Lenders:

 

2

 

Exhibit 1.1(a)

 

BANKRUPTCY REMOTE
BORROWING ENTITY REQUIREMENTS

 

A “Bankruptcy Remote
Borrowing Entity” shall satisfy the following requirements:

 

1.             General Requirements.  The entity’s Organizational Documents must provide for the
following (the term “Organizational Documents” as used herein means (i)
with respect to a corporation, its bylaws, (ii) with respect to a limited
partnership, its limited partnership agreement, and (iii) with respect to a
limited liability company, its operating agreement):

 

(A)                              Limited
Purpose.  The entity’s purpose must
be limited solely to owning and managing its assets, entering into the Credit
Documents and the transactions contemplated thereby and engaging in incidental
activities in connection therewith.

 

(B)                                Certain
Actions Requiring Unanimous Vote. 
The unanimous vote of the entity’s board of directors (including that of
the Independent Director, as defined in Section 2(A) hereof), partners or
members, as applicable, must be required in order to:

 

(i)            take any Bankruptcy Action (as
defined in Addendum A hereof);

 

(ii)                                  dissolve,
liquidate, consolidate, merge or sell all or substantially all of its assets;

 

(iii)          amend or recommend the amendment of
its Organizational Documents; and

 

(iv)                              engage
in transactions with affiliates (except to the extent such transactions are on
terms and conditions substantially as favorable to such Person as would be
obtainable by it in a comparable arms-length transaction with a Person other
than an officer, director, shareholder, Subsidiary or Affiliate).

 

(C)           Separateness Provisions.  The entity must be required to:

 

(i)                                     not
commingle assets with those of any other entity and must hold its assets in its
own name;

 

(ii)                                  conduct
its own business in its own name;

 

(iii)                               maintain separate bank
accounts, books, records and financial statements;

 

(iv)                              maintain
its books, records, resolutions and agreements as official records;

 

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

 

(vi)                              maintain
adequate capital in light of contemplated business operations;

 

(vii)                           observe all corporate,
partnership, company or other organizational formalities;

 

(viii)                        maintain an arm’s-length
relationship with affiliates;

 

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

 

3

 

(x)                                   not
guarantee or become obligated for the debts of any other entity or hold out its
credit as being available to satisfy the obligations of others;

 

(xi)                                not
acquire obligations or securities of affiliates;

 

(xii)                             not make loans to any
other person or entity;

 

(xiii)                          allocate fairly and
reasonably any overhead for shared office space;

 

(xiv)                         use separate stationery, invoices
and checks;

 

(xv)                            not
pledge its assets for the benefit of any other entity;

 

(xvi)                         hold itself out as a separate
entity, and not fail to correct any known misunderstanding regarding its
separate identity; and

 

(xvii)                      not identify itself or any of its
affiliates as a division or part of the other.

 

(D)                               Subordination
of Indemnification Obligations.  The
entity’s obligation, if any, to indemnify its directors and officers, partners,
or members or managers, as applicable, must be fully subordinated to the loan
and the loan documents and must not constitute a claim against it in the event
that cash flow in excess of amounts necessary to pay holders of the loan is
insufficient to pay such obligations.

 

2.                                       Additional
Requirements for Corporations.  In
addition to the general requirements set forth above, for a corporation to be a
Bankruptcy Remote Borrowing Entity, its Organizational Documents must provide
for the following:

 

(A)                              Independent
Director.  The corporation’s board
of directors must include an Independent Director.  An “Independent Director” means a director of the
corporation who is not at the time of initial appointment, has not been at any
time during the preceding five (5) years, and will not be at any time
prior to payment of the loan in full: (i) a stockholder, director, officer,
employee, partner or member of the corporation or the borrower (if the
corporation is a partner or member of the borrower),  or any affiliate thereof;
(ii) a customer, supplier or other person (including without limitation, an
attorney, accountant or other professional) who derives any portion of its
purchases or revenues from its activities with the corporation or the borrower
(if the corporation is a partner or member of the borrower) or any affiliate
thereof, other than reasonable compensation for the performance of its
obligations as Independent Director; (iii) a person or other entity controlling
or under common control with any such stockholder, partner, member, customer,
supplier or other person; or (iv) a member of the immediate family of any such
stockholder, director, officer, employee, partner, member, customer, supplier
or other person.  As used herein, the
term “control” means the possession, directly or indirectly, of the power to
direct or cause the direction of management, policies or activities of a person
or entity, whether through ownership of voting securities, by contract or
otherwise.

 

3.                                       Additional
Requirements for Limited Partnerships. 
In addition to the general requirements set forth above, for a limited
partnership to be a Bankruptcy Remote Borrowing Entity, its Organizational
Documents must provide for the following:

 

(A)                              General
Partner.  Each general partner of
the limited partnership must be a Bankruptcy Remote Borrowing Entity satisfying
the general requirements set forth above and the additional requirements set
forth herein applicable to such general partner (i.e., corporate, limited
partnership or limited liability company requirements).  In addition, each such general partner’s
Organizational Documents must provide for the following:

 

4

 

(i)                                     Limited
Purpose.  Each such general
partner’s purpose must be limited to serving as a general partner in the
limited partnership.

 

(ii)                                  Unanimous
Vote Required to Withdraw.  The
unanimous vote of each such the general partner’s board of directors (including
that of the Independent Director), partners or members, as applicable, must be
required for the a general partner to withdraw as a general partner of the
limited partnership.

 

(B)                                Continuance
of Partnership.  If there is more
than one general partner, the Organizational Documents must require the
remaining partners to continue the partnership upon an event of dissolution for
so long at least one of the general partners remains solvent.

 

4.                                       Additional
Requirements for Limited Liability Companies.  In addition to the general requirements set forth above, for a
limited liability company to be an SPE, its Organizational Documents must
provide for the following:

 

(A)                              Independent
Member/Manager.  The company must
have one independent member/manager. 
Such independent member/manager should have the same basic traits as the
independent directors described with respect to corporate SPEs.  The determination of whether the independent
entity/individual must be a manager or a member is dependent upon the locus of
control in the LLC.

 

(B)                                SPE
Member.  At least one member of the
company must be an SPE satisfying the general SPE requirements set forth above
and the additional requirements applicable to such member (i.e., corporate,
limited partnership or limited liability company requirements).  “Bankruptcy” events of dissolution must be
limited to the bankruptcy of such SPE member. 
This may necessitate that the entity be designated the sole “managing
member” of the company.  Each such SPE
member’s Organizational Documents must provide for the following:

 

(i)                                     Limited
Purpose.  Such member’s purpose must
be limited to serving as a member in the company.

 

(ii)                                  Unanimous
Vote Required to Withdraw.  The
unanimous vote of such member’s board of directors (including that of the
Independent Director), partners or members, as applicable, must be required for
the member to withdraw as a member of the company.

 

(C)                                Consideration
of Interests of Creditors.  The
company’s members must be required to consider the interests of creditors in
connection with any action subject to the vote of its members (including the
SPE member), notwithstanding that the company may not then be insolvent.

 

(D)                               Continuance
of Company.  The vote of a
majority-in-interest of the remaining members of the company is sufficient to
continue the life of the company upon the occurrence of an event of dissolution
or other termination event.  If the
required consent of the remaining members to continue the company is not
obtained, the company’s Organization Documents must provide that the company
not liquidate collateral (except as permitted under the loan documents) without
the consent of holders of the loan, and that such holders may continue to
exercise all of their rights under the loan documents and retain any collateral
until the loan has been paid in full or otherwise completely discharged.

 

5

 

Addendum A

 

As used herein, “Bankruptcy
Action” means any of the following:

 

1.                                       Taking
any action that might cause the entity (or the borrower if the entity is a
partner or member of the borrower)  to become insolvent.

 

2.                                       Commencing
any case, proceeding or other action on behalf of the entity (or the borrower
if the entity is a partner or member of the borrower) under any existing or
future law of any jurisdiction relating to bankruptcy, insolvency,
reorganization or relief of debtors.

 

3.                                       Instituting
proceedings to have the entity (or the borrower if the entity is a partner or
member of the borrower) adjudicated as bankrupt or insolvent.

 

4.                                       Consenting
to the institution of bankruptcy or insolvency proceedings against the entity
(or the borrower if the entity is a partner or member of the borrower).

 

5.                                       Filing
a petition or consent to a petition seeking reorganization arrangement,
adjustment, winding-up, dissolution, composition, liquidation or other relief
on behalf of the entity (or the borrower if the entity is a partner or member
of the borrower) of its (or their) debts under any federal or state law
relating to bankruptcy.

 

6.                                       Seeking
or consenting to the appointment of a receiver, liquidator, assignee, trustee,
sequestrator, custodian or any similar official for the entity (or the borrower
if the entity is a partner or member of the borrower) or a substantial portion
of its (or their) properties.

 

7.                                       Making
any assignment for the benefit of the entity’s creditors (or the borrower’s
creditors if the entity is a partner or member of the borrower).

 

8.                                       Taking
any action (or causing the borrower to take any action if the entity is a
partner or member of the borrower) in furtherance of any of the foregoing.

 

***

Note also the potential necessity for a
Non-Consolidation Opinion from Borrower’s counsel.

 

 

Exhibit 2.1(b)(i)

 

FORM OF
NOTICE OF BORROWING

 

Charlene
E. Wright-Jones

Assistant
Vice President

Bank
of America, N.A.

231
South LaSalle Street

Mail
code:  IL1-231-10-30

Chicago,
IL 60697

Phone:  312-828-4160

Fax:  312-828-3950

E-mail:  charlene.wright-jones@bankofamerica.com

 

Ladies and
Gentlemen:

 

The undersigned,
U.S.  RESTAURANT PROPERTIES OPERATING,
L.P., as the Principal Borrower thereunder (the “Borrower”), refers to
the Term Loan Credit Agreement dated as of November 4, 2003 (as amended,
modified, restated or supplemented from time to time, the “Credit Agreement”),
among the Borrower, the other borrowers named therein, the Guarantors, the
Lenders and Bank of America, N.A., as Agent. 
Capitalized terms used herein and not otherwise defined herein shall
have the meanings assigned to such terms in the Credit Agreement.  The Borrower hereby gives notice pursuant to
Section 2.1 of the Credit Agreement that it requests a Loan advance under
the Credit Agreement, and in connection therewith sets forth below the terms on
which such Loan advance is requested to be made:

 

	
  [(A)

  	
   

  	
  Date of Borrowing
  (which is a Business Day)

  	
   

  	
                                         ]*

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  [(B)

  	
   

  	
  Principal Amount of
  Borrowing

  	
   

  	
                                         ]*

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (C)

  	
   

  	
  Interest rate basis

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (D)

  	
   

  	
  Interest Period and the
  last day thereof

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (E)

  	
   

  	
  Purpose of borrowing

  	
   

  	
   

  

 

 

 

In accordance with
the requirements of Section 5.2, the Borrower hereby reaffirms the
representations and warranties set forth in the Credit Agreement as provided in
clause (b) of such Section, and confirms that the matters referenced in
clauses (c), (d) and (e) of such Section, are true and correct.  The Borrower hereby covenants and agrees to
use the proceeds of the borrowing requested above solely for those purposes
expressly permitted pursuant to Sections 6.15 and 7.9 of the Credit Agreement.

 

	
   

  	
  U.S.  RESTAURANT PROPERTIES OPERATING, L.P.,

  
	
   

  	
  as Principal Borrower

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
  Title:

  	
  Chief Financial Officer

  
						

 

2

 

Exhibit
2.1(e)

 

TERM
NOTE

[USRP/BANK
OF AMERICA, N.A.]

 

	
  $35,000,000.00

  	
   

  	
  November 4, 2003

  

 

FOR VALUE RECEIVED, U.S.
RESTAURANT PROPERTIES OPERATING, L.P., a Delaware corporation, USRP FUNDING
2002-A, L.P., a Texas limited partnership, USRP (S&C), LLC, a Texas limited
liability company, USRP (JV1), LLC, a Texas limited liability company, USRP/HCI
PARTNERSHIP 1, L.P., a Texas limited partnership and USRP Holding Corp., a Texas
corporation (collectively, the “Borrower”), hereby promise to pay to the
order of BANK OF AMERICA, N.A., its successors and assigns (the “Lender”),
at the office of Bank of America, N.A., as Agent (the “Agent”), at  231 South LaSalle Street, Mail code: 
IL1-231-10-30, Chicago, IL 60697 (or at such other place or
places as the holder hereof may designate), at the times set forth in the Term
Loan Credit Agreement dated as of November 4, 2003 among the Borrower, the
Guarantors, the Lenders and the Agent (as it may be as amended, modified,
restated or supplemented from time to time, the “Credit Agreement”; all
capitalized terms not otherwise defined herein shall have the meanings set
forth in the Credit Agreement), but in no event later than the Maturity Date,
in Dollars and in immediately available funds, the principal amount of THIRTY-FIVE
MILLION AND NO/100 DOLLARS ($35,000,000.00) or, if less than such
principal amount, the aggregate unpaid principal amount of all Loans made by
the Lender to the Borrower pursuant to the Credit Agreement, and to pay
interest from the date hereof on the unpaid principal amount hereof, in like
money, at said office, on the dates and at the rates selected in accordance
with Section 2.1(d) of the Credit Agreement.

 

Upon the occurrence and
during the continuance of an Event of Default, the balance outstanding
hereunder shall bear interest as provided in Section 3.1 of the Credit
Agreement.  Further, in the event the
payment of all sums due hereunder is accelerated under the terms of the Credit
Agreement, this Note, and all other indebtedness of the Borrower to the Lender
shall become immediately due and payable, without presentment, demand, protest
or notice of any kind, all of which are hereby waived by the Borrower.

 

In the event this Note is
not paid when due at any stated or accelerated maturity, the Borrower agrees to
pay, in addition to the principal and interest, all costs of collection,
including reasonable attorneys’ fees.

 

This Note and the Loans
evidenced hereby may be transferred in whole or in part only by registration of
such transfer on the Register maintained by or on behalf of the Borrower as
provided in Section 11.3(c) of the Credit Agreement.

 

 

[remainder of page left intentionally blank –
signature page to follow]

 

3

 

IN WITNESS WHEREOF, the Borrower has caused this Note
to be duly executed by its duly authorized officer as of the day and year first
above written.

 

	
  PRINCIPAL BORROWER:

  	
  U.S.  RESTAURANT
  PROPERTIES OPERATING L.P.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:  USRP MANAGING, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  
	
  GENERAL SPE:

  	
  USRP FUNDING 2002-A, L.P.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:  USRP (SFGP) 2, LLC

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  
	
  S&C:

  	
  USRP (S&C), LLC

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  
	
  HCI:

  	
  USRP/HCI PARTNERSHIP 1, L.P.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:  USRP (JV1), LLC

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  
	
  JV1:

  	
  USRP (JV1), LLC

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  
	
  USRP Holding:

  	
  USRP HOLDING CORP.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  
										

 

4

 

Exhibit 3.2

 

FORM OF NOTICE OF
CONTINUATION/CONVERSION

 

Bank of America, N.A.,

  as Agent for the Lenders

101 North Tryon Street

Independence Center, 15th
Floor

NC1-001-15-04

Charlotte, North
Carolina  28255

Attention:  Agency Services

 

Ladies and Gentlemen:

 

The undersigned, U.S. 
RESTAURANT PROPERTIES OPERATING, L.P., as principal borrower thereunder
(the “Borrower”), refers to the Term Loan Credit Agreement dated as of
November 4, 2003 (as amended, modified, restated or supplemented from time to
time, the “Credit Agreement”), among the Borrower, the other borrowers
named therein, the Guarantors, the Lenders and Bank of America, N.A., as Agent.
 Capitalized terms used herein and not
otherwise defined herein shall have the meanings assigned to such terms in the
Credit Agreement.  The Borrower hereby
gives notice pursuant to Section 3.2 of the Credit Agreement that it
requests an continuation or conversion of a Loan outstanding under the Credit
Agreement, and in connection therewith sets forth below the terms on which such
extension or conversion is requested to be made:

 

	
  (A)

  	
   

  	
  Loan Type

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (B)

  	
   

  	
  Date of Extension or
  Conversion

  	
   

  
	
   

  	
   

  	
  (which is the last day
  of the

  	
   

  
	
   

  	
   

  	
  the applicable Interest
  Period)

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (C)

  	
   

  	
  Principal Amount of
  Extension or Conversion

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (D)

  	
   

  	
  Interest rate basis

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (E)

  	
   

  	
  Interest Period and the
  last day thereof

  	
   

  
	
   

  	
   

  	
   

  	
   

  

 

In accordance with
the requirements of Section 5.2, the Borrower hereby reaffirms the
representations and warranties set forth in the Credit Agreement as provided in
clause (b) of such Section, and confirms that the matters referenced in
clauses (c), (d) and (e) of such Section, are true and correct.

 

The undersigned officer of U.S. Restaurant Properties
Operating L.P. hereby represents and warrants that he/she has the necessary
power and authority to execute this letter on behalf of the Borrower and that
such action has been duly authorized by all necessary action of the Borrower
and its partners prior to or on the date hereof.

 

	
   

  	
  U.S.  RESTAURANT PROPERTIES OPERATING, L.P.,

  
	
   

  	
  as Principal Borrower

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
  Title:

  	
  Chief Financial Officer

  
						

 

5

 

Exhibit 7.1(c)

 

FORM OF OFFICER’S COMPLIANCE
CERTIFICATE

 

For the fiscal quarter ended
                           , 20   .

 

I,
                                       ,
[Title] of U.S.  RESTAURANT PROPERTIES
OPERATING, L.P., as principal borrower (the “Borrower”) hereby certify
that, to the best of my knowledge and belief, with respect to that certain
Credit Agreement dated as of November 4, 2003 (as amended, modified, restated
or supplemented from time to time, the “Credit Agreement”; all of the
defined terms in the Term Loan Credit Agreement are incorporated herein by
reference) among the Borrower, the Guarantors, the Lenders and Bank of America,
N.A., as Agent:

 

a.             The company-prepared financial
statements which accompany this certificate are true and correct in all
material respects and have been prepared in accordance with GAAP applied on a
consistent basis, subject to changes resulting from normal year-end audit
adjustments.

 

b.             Since
                   
(the date of the last similar certification, or, if none, the Closing Date) no
Default or Event of Default has occurred under the Credit Agreement; and

 

c.             Since
                   
(the date of the last similar certification, or, if none, the Closing Date) the
Consolidated Parties have entered into the following Hedging Agreements:

 

Delivered herewith are detailed calculations
demonstrating compliance by the Credit Parties with the Financial Covenants as
of the end of the fiscal period referred to above.

 

This
            day of
                 , 20   .

 

 

	
   

  	
  U.S.  RESTAURANT PROPERTIES OPERATING, L.P.,

  
	
   

  	
  as Principal Borrower

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  
	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
  Title:

  	
  Chief Financial Officer

  
				

 

6

 

Attachment to Officer’s
Certificate

 

Computation of Financial Covenants

 

7

 

Exhibit 7.12

 

FORM OF JOINDER AGREEMENT

 

THIS JOINDER AGREEMENT (the “Agreement”),
dated as of
                     , 20  ,
is by and between                                      ,
a                                      
(the “Subsidiary”), and BANK OF AMERICA, N. 
A., in its capacity as Agent under that certain Term Loan
Credit Agreement (as it may be amended, modified, restated or supplemented from
time to time, the “Credit Agreement”), dated as of November 4, 2003, by
and among U.S. RESTAURANT PROPERTIES OPERATING L.P., a Delaware limited
partnership (“USRP Operating” or the “Principal Borrower”), USRP
FUNDING 2002-A, L.P., a Texas limited partnership (the “General SPE”);
USRP (S&C), LLC, a Texas limited liability company (“S&C”), USRP
(JV1), LLC, a Texas limited liability company (“JV1”), USRP/HCI
PARTNERSHIP 1, L.P., a Texas limited partnership (“HCI”), USRP HOLDING
CORP., a Texas corporation (“USRP Holding”; and together with the
Principal Borrower, the General SPE, HCI, JV1 and S&C, the “Borrower”),
the Guarantors, the Lenders and BANK OF AMERICA, N.A., as Agent.  All of the defined terms in the Credit
Agreement are incorporated herein by reference.

 

The Credit Parties are required by Section 7.12
of the Credit Agreement to cause the Subsidiary to become a “Guarantor”.

 

Accordingly, the Subsidiary hereby agrees as follows
with the Agent, for the benefit of the Lenders:

 

1.             The
Subsidiary hereby acknowledges, agrees and confirms that, by its execution of
this Credit Agreement, the Subsidiary will be deemed to be a party to the
Credit Agreement and a “Guarantor” for all purposes of the Credit Agreement,
and shall have all of the obligations of a Guarantor thereunder as if it had
executed the Credit Agreement.  The
Subsidiary hereby ratifies, as of the date hereof, and agrees to be bound by,
all of the terms, provisions and conditions applicable to the Guarantors
contained in the Credit Agreement.  Without
limiting the generality of the foregoing terms of this paragraph 1, the
Subsidiary hereby jointly and severally together with the other Guarantors,
guarantees to each Lender and the Agent, as provided in Section 4 of the
Credit Agreement, the prompt payment and performance of the Credit Party
Obligations in full when due (whether at stated maturity, as a mandatory
prepayment, by acceleration or otherwise) strictly in accordance with the terms
thereof.

 

2.             The
address of the Subsidiary for purposes of all notices and other communications
is
                                 ,
                                                          ,
Attention of
                      
(Facsimile No. 
                   ).

 

3.             The
Subsidiary hereby waives acceptance by the Agent and the Lenders of the
guaranty by the Subsidiary under Section 4 of the Credit Agreement upon
the execution of this Credit Agreement by the Subsidiary.

 

4.             This
Credit Agreement may be executed in two or more counterparts, each of which
shall constitute an original but all of which when taken together shall
constitute one contract.

 

5.             This
Credit Agreement shall be governed by and construed and interpreted in
accordance with the laws of the State of North Carolina.

 

IN WITNESS WHEREOF, the Subsidiary has caused this
Joinder Agreement to be duly executed by its authorized officers, and the
Agent, for the benefit of the Lenders, has caused the same to be accepted by
its authorized officer, as of the day and year first above written.

 

	
   

  	
  [SUBSIDIARY]

  	 

	
   

  	
   

  	 

	
   

  	
  By:

  	
   

  	
   

  	 

	
   

  	
  Name:

  	
   

  	
   

  	 

	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	 

	
   

  	
  Acknowledged and
  accepted:

  	 

	
   

  	
   

  	 

	
   

  	
  BANK OF AMERICA,
  N.  A., as Agent

  	 

	
   

  	
   

  	 

	
   

  	
  By:

  	
   

  	
   

  	 

	
   

  	
  Name:

  	
   

  	
   

  	 

	
   

  	
  Title:

  	
   

  	
   

  	 

											

 

8

 

Exhibit 11.3(b)

 

ASSIGNMENT AND ASSUMPTION

 

This Assignment
and Assumption (the “Assignment and Assumption”) is dated as of the
Closing Date set forth below and is entered into by and between [Insert name
of Assignor] (the “Assignor”) and [Insert name of Assignee]
(the “Assignee”).  Capitalized
terms used but not defined herein shall have the meanings given to them in the
Term Loan Credit Agreement identified below (as amended, the “Credit
Agreement”), receipt of a copy of which is hereby acknowledged by the
Assignee.  The Standard Terms and
Conditions set forth in Annex 1 attached hereto are hereby agreed to and
incorporated herein by reference and made a part of this Assignment and
Assumption as if set forth herein in full.

 

For an agreed
consideration, the Assignor hereby irrevocably sells and assigns to the
Assignee, and the Assignee hereby irrevocably purchases and assumes from the
Assignor, subject to and in accordance with the Standard Terms and Conditions
and the Credit Agreement, as of the Closing Date inserted by the Agent as
contemplated below (i) all of the Assignor’s rights and obligations in its
capacity as a Lender under the Credit Agreement and any other documents or
instruments delivered pursuant thereto to the extent related to the amount and
percentage interest identified below of all of such outstanding rights and
obligations of the Assignor under the respective facilities identified below
(including without limitation any letters of credit, guarantees, and swingline
loans included in such facilities) and (ii) to the extent permitted to be
assigned under applicable law, all claims, suits, causes of action and any
other right of the Assignor (in its capacity as a Lender) against any Person,
whether known or unknown, arising under or in connection with the Credit
Agreement, any other documents or instruments delivered pursuant thereto or the
loan transactions governed thereby or in any way based on or related to any of
the foregoing, including, but not limited to, contract claims, tort claims,
malpractice claims, statutory claims and all other claims at law or in equity
related to the rights and obligations sold and assigned pursuant to clause (i)
above (the rights and obligations sold and assigned pursuant to clauses (i) and
(ii) above being referred to herein collectively as, the “Assigned Interest”).  Such sale and assignment is without recourse
to the Assignor and, except as expressly provided in this Assignment and
Assumption, without representation or warranty by the Assignor.

 

	
  1.

  	
  Assignor:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
  Assignee:

  	
   

  	
   

  
	
   

  	
   

  	
  [and is an
  Affiliate/Approved Fund of [identify Lender](1)

  
	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
  Borrower(s):

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
  Agent:

  	
                                       ,
  as the agent under the Credit Agreement

  
	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
  Credit Agreement:

  	
  That certain Term Loan
  Credit Agreement dated as of November 4, 2003 among U.S. Restaurant Operating,
  L.P., USRP Funding 2002-A, L.P., as the Principal Borrower, the other
  Borrowers thereunder, the Guarantors referenced therein, the Lenders parties
  thereto, Bank of America, N.A., as Agent, and the other agents parties
  thereto.

  
	
   

  	
   

  	
   

  	
   

  
	
  6.

  	
  Assigned Interest:

  	
   

  	
   

  

 

	
  Facility Assigned(2)

  	
   

  	
  Aggregate
  Amount of

  Commitment/Loans for all

  Lenders*

  	
   

  	
  Amount of

  Commitment/Loans

  Assigned*

  	
   

  	
  Percentage
  Assigned of

  Commitment/Loans(3)

  	
   

  
	
   

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
   

  	
  %

  
	
   

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
   

  	
  %

  
	
   

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
   

  	
  %

  

 

(1)Select as applicable.

(2) Fill in the appropriate terminology for the types of facilities
under the Credit Agreement that are being assigned under this Assignment (e.g.
“Revolving Credit Commitment,” “Term Loan Commitment,” etc.)

* Amount
to be adjusted by the counterparties to take into account any payments or
prepayments made between the Trade Date and the Closing Date.

(3) Set forth, to at least 9 decimals, as a percentage of the
Commitment/Loans of all Lenders thereunder.

 

9

 

	
  [7.

  	
  Trade Date:

  	
   

  	
                               ](4)

  

 

Closing Date:  
                                   
      , 20      [TO BE
INSERTED BY AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF
TRANSFER IN THE REGISTER THEREFOR.]

 

The terms set forth in
this Assignment and Assumption are hereby agreed to:

 

	
   

  	
  ASSIGNOR

  
	
   

  	
  [NAME OF ASSIGNOR]

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  ASSIGNEE

  
	
   

  	
  [NAME OF ASSIGNEE]

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  
						

 

Consented to and
Accepted:

 

BANK OF AMERICA, N.A., as
Agent

 

	
  By

  	
   

  	
   

  	
   

  
	
    Title:

  	
   

  
	
   

  	
   

  
	
  Consented to:

  	
   

  
	
   

  	
   

  
	
  U.S.  RESTAURANT PROPERTIES OPERATING, L.P.  ,

  	
   

  
	
  as Principal Borrower

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  
								

 

(4) To be completed if the Assignor and the Assignee intend that the
minimum assignment amount is to be determined as of the Trade Date.

 

10

 

ANNEX 1

 

STANDARD TERMS AND CONDITIONS FOR

ASSIGNMENT AND ASSUMPTION

 

1.  Representations and Warranties.

 

1.1   Assignor.  The Assignor (a) represents and warrants that (i) it is the legal
and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is
free and clear of any lien, encumbrance or other adverse claim and (iii) it has
full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby; and (b) assumes no responsibility with respect to (i) any
statements, warranties or representations made in or in connection with the
Credit Agreement or any other Credit Document, (ii) the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Credit
Documents or any collateral thereunder, (iii) the financial condition of the
Borrower, any of its Subsidiaries or Affiliates or any other Person obligated
in respect of any Credit Document or (iv) the performance or observance by the
Borrower, any of its Subsidiaries or Affiliates or any other Person of any of
their respective obligations under any Credit Document.

 

1.2.  Assignee.  The Assignee (a) represents and warrants that (i) it has full
power and authority, and has taken all action necessary, to execute and deliver
this Assignment and Assumption and to consummate the transactions contemplated
hereby and to become a Lender under the Credit Agreement, (ii) it meets all
requirements of an Eligible Assignee under the Credit Agreement (subject to
receipt of such consents as may be required under the Credit Agreement), (iii)
from and after the Closing Date, it shall be bound by the provisions of the
Credit Agreement as a Lender thereunder and, to the extent of the Assigned
Interest, shall have the obligations of a Lender thereunder, (iv) it has
received a copy of the Credit Agreement, together with copies of the most
recent financial statements delivered pursuant to the terms thereof, as
applicable, and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Assignment and Assumption and to purchase the Assigned Interest on the basis of
which it has made such analysis and decision independently and without reliance
on the Agent or any other Lender, and (v) if it is a Foreign Lender(5),
attached to the Assignment and Assumption is any documentation required to be
delivered by it pursuant to the terms of the Credit Agreement, duly completed
and executed by the Assignee; and (b) agrees that (i) it will, independently
and without reliance on 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 Documents, and (ii) it will perform in accordance with their terms
all of the obligations which by the terms of the Credit Documents are required
to be performed by it as a Lender.

 

2.   Payments.  From and after the Closing Date, the Agent shall make all
payments in respect of the Assigned Interest (including payments of principal,
interest, fees and other amounts) to the Assignor for amounts which have accrued
to but excluding the Closing Date and to the Assignee for amounts which have
accrued from and after the Closing Date. The Assignee hereby acknowledges and
agrees to the terms contained in the Intercreditor Agreement.

 

3.  General Provisions. This Assignment and
Assumption shall be binding upon, and inure to the benefit of, the parties
hereto and their respective successors and assigns.  This Assignment and Assumption may be executed in any number of
counterparts, which together shall constitute one instrument.  Delivery of an executed counterpart of a
signature page of this Assignment and Assumption by telecopy shall be effective
as delivery of a manually executed counterpart of this Assignment and
Assumption.  This Assignment and
Assumption shall be governed by, and construed in accordance with, the law of
the State of North Carolina.

 

11Exhibit
10.5

 

SECURITIES PURCHASE AGREEMENT

 

This Securities Purchase
Agreement (this “Agreement”) is dated as of November 4, 2003, among
U.S. Restaurant Properties, Inc., a Maryland corporation (the “Parent”),
USRP (JV1), LLC, a Texas limited liability company and wholly-owned subsidiary
of the Parent (the “Company”), and Harbilan Corporation, a Florida
corporation (collectively, including its successors and assigns, the “Purchaser”).

 

WHEREAS, subject to the
terms and conditions set forth in this Agreement, the Parent desires to issue
and sell to the Purchaser, and the Purchaser desires to purchase from the
Parent securities of the Parent, and the Company desires to purchase the
Subscription Securities, each as more fully described in this Agreement.

 

NOW, THEREFORE, IN
CONSIDERATION of the mutual covenants contained in this Agreement, and for
other good and valuable consideration the receipt and adequacy of which are
hereby acknowledged, the Parent, the Company and the Purchaser agree as
follows:

 

ARTICLE I

DEFINITIONS

 

1.1           Definitions.  In addition to the terms defined elsewhere
in this Agreement: (a) capitalized terms that are not otherwise defined herein
have the meanings given to such terms in the Articles Supplementary (as defined
herein), and (b) the following terms have the meanings indicated in this
Section 1.1:

 

“Actual
Minimum” means, as of any date, the maximum aggregate number of Underlying
Shares then issued or potentially issuable in the future upon conversion of all
shares of Preferred Stock.

 

“Affiliate”
means any Person that, directly or indirectly through one or more
intermediaries, controls or is controlled by or is under common control with a
Person, as such terms are used in and construed under Rule 144 under the
Securities Act.  With respect to a
Purchaser, any investment fund or managed account that is managed on a
discretionary basis by the same investment manager as such Purchaser will be
deemed to be an Affiliate of such Purchaser.

 

“Agent”
shall have the meaning ascribed to such term in Section 2.2(f).

 

“Articles
Supplementary” means the Articles Supplementary relating to the Preferred
Stock, in the form of Exhibit A attached hereto.

 

“Cash
Consideration” means $51,842,853.

 

“Closing”
means the Closing of the purchase and sale of the Securities pursuant to
Section 2.1.

 

“Closing
Date” means the date of the Closing.

 

“Commission”
means the Securities and Exchange Commission.

 

 

“Commitment
Letter” shall have the meaning ascribed to such term in
Section 2.2(f).

 

“Common
Stock” means the common stock of the Parent, par value $0.001 per share,
and any securities into which such common stock shall hereinafter been
reclassified into.

 

“Company
Counsel” means Locke Liddell & Saap LLP, outside counsel to the Parent
and the Company, with offices at 2200 Ross Avenue, Suite 2200, Dallas, Texas
75201-6776.

 

“Credit
Agreement” shall have the meaning ascribed to such term in
Section 2.2(f).

 

“Disclosure
Schedules” shall have the meaning ascribed to such term in
Section 3.1.

 

“Exchange
Act” means the Securities Exchange Act of 1934, as amended.

 

“GAAP”
shall have the meaning ascribed to such term in Section 3.1(h).

 

“Lenders”
shall have the meaning ascribed to such term in Section 2.2(f).

 

“Liens”
shall have the meaning ascribed to such term in Section 3.1(a).

 

“Losses”
means any and all losses, claims, damages, liabilities, settlement costs and
expenses, including without limitation costs of preparation and reasonable
attorneys’ fees.

 

“Material
Adverse Effect” shall have the meaning assigned to such term in
Section 3.1(b).

 

“MVA”
means Moore & Van Allen, PLLC with offices at Suite 4700, 100 North Tryon
Street, Charlotte, North Carolina 28202.

 

“Person”
means an individual or corporation, partnership, trust, incorporated or
unincorporated association, joint venture, limited liability company, joint
stock company, government (or an agency or subdivision thereof) or other entity
of any kind.

 

“Preferred
Stock” means the Parent’s $1.93 Series A Cumulative Convertible
Preferred Stock sold hereunder having the rights, preferences and privileges
set forth in the Articles Supplementary.

 

“Preferred
Stock Consideration” means $8,592,438.

 

“Principal
Market” initially means the New York Stock Exchange and shall also include
the NASDAQ Small-Cap Market, the American Stock Exchange or the NASDAQ National
Market, whichever is at the time the principal trading exchange or market for
the Common Stock and the Preferred Stock, based upon share volume.

 

“Proceeding”
means an action, claim, suit, investigation or proceeding (including, without
limitation, an investigation or partial proceeding, such as a deposition),
whether commenced or threatened.

 

2

 

“Prospectus
Supplement” means a supplemental prospectus to be filed by the Parent with
the Commission pursuant to Rule 424 of the Securities Act, specifically
relating to the issuance of the Preferred Stock to the Purchaser.

 

“Registration
Statement” means the shelf registration statement filed by the Parent on
Form S-3 (Registration No. 333-66371) and subsequent amendments thereto.

 

“Required
Approvals” shall have the meaning ascribed to such term in
Section 3.1(e).

 

“Rule 144”
means Rule 144 promulgated by the Commission pursuant to the Securities
Act, as such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the Commission having substantially the same
effect as such Rule.

 

“SEC
Reports” shall have the meaning ascribed to such term in
Section 3.1(i).

 

“Securities”
means the Preferred Stock and the Underlying Shares.

 

“Securities
Act” means the Securities Act of 1933, as amended.

 

“Stockholder
Approval” means such approval as may be required by the applicable rules
and regulations of the Principal Market (or any successor entity) from the
shareholders of the Parent with respect to the transactions contemplated by the
Transaction Documents, including the issuance of all of the Underlying Shares
in excess of 20% of the Parent’s issued and outstanding Common Stock on the
Closing Date.

 

“Subscription
Securities” shall mean all of the Purchaser’s entire right, title and
interest in its limited partnership interests in USRP/HCI Partnership 1, L.P.,
which represents the amount to be exchanged by the Purchaser for the
consideration from the Company described in Section 2.1(a)(ii).

 

“Subscription
Fee” shall have the meaning ascribed to such term in Section 2.2(f).

 

“Subsidiary”
means any subsidiary of the Parent that is required to be listed in Schedule 3.1(a).

 

“Trading
Day” means any day during which the Principal Market shall be open for
business.

 

“Transaction
Documents” means this Agreement, the Articles Supplementary, the
Credit Agreement (as defined herein) and any other documents or agreements
executed in connection with the transactions contemplated hereunder.

 

“Underlying
Shares” means the shares of Common Stock issuable upon conversion of the
Preferred Stock.

 

3

 

ARTICLE II

EXCHANGE, PURCHASE AND SALE

 

2.1           Purchase; Sale; Exchange and Investment.  Upon the terms and subject to the conditions
set forth herein, concurrent with the execution and delivery of this Agreement
by the parties hereto or such other time as shall be agreed to by the parties
hereto,

 

(a)           (i) the Purchaser shall tender to the
Parent the Preferred Stock Consideration by wire transfer of immediately
available funds to an account designated by the Parent; and (ii) the Parent
shall issue 404,350 shares of Preferred Stock to the Purchaser; and

 

(b)           (i) the Purchaser shall tender to the
Company the Subscription Securities; and (ii) the Company shall pay the Cash
Consideration to the Purchaser by wire transfer of immediately available funds
to an account designated in writing by the Purchaser.

 

2.2           Proration of Priority Distribution.  In addition to tendering the Subscription
Securities provided in Section 2.1(a)(i), the Company shall also pay to
the Purchaser the Priority Distribution (as defined in the USRP/HCI Partnership
1, L.P. partnership agreement) for the relevant period, prorated for the number
of days between October 20, 2003 and the Closing Date, which the Company
and the Purchaser hereby agree shall be equal to $213,642.  The Company shall not be entitled to the
Buyout Price (as defined in the USRP/HCI Partnership 1, L.P. partnership
agreement).

 

2.3           Conditions to Closing.  The Closing is subject to the satisfaction
or waiver by the party to be benefited thereby of the following conditions:

 

(a)           The Parent and the Company shall have
delivered or caused to be delivered to the Purchaser the following:

 

(i)            this Agreement duly executed by the
Parent and the Company;

 

(ii)           evidence of the transfer of 404,350
shares of Preferred Stock to the Purchaser’s account at the Depository Trust
Company;  and

 

(iii)          a legal opinion of Company Counsel, in
the form of Exhibit B attached hereto, addressed to the Purchaser;

 

(iv)          the Prospectus Supplement, a copy of
which shall have been filed by the Parent with the Commission on or prior to
the Closing Date;

 

(v)           a certificate dated the Closing Date,
executed by an officer of the Parent satisfactory to the Purchaser, to the
effect that the conditions set forth in subsections (c) and (d) of this
Section 3.3 have been satisfied; and

 

(vi)          a certificate dated the Closing Date,
executed by the Secretary of each entity, to the effect that (A) the
Certificate of Incorporation and By-laws of each entity shall have not been
amended since the date upon which certified copies of each had been delivered
to Purchaser and remain in full force and effect and (B) the officer executing
this Agreement on behalf of each entity is duly elected and hold the office set
forth therein, with copies of resolutions approved by the Board of Directors of
each entity attached as an exhibit thereto.

 

4

 

(b)           At the Closing, the Purchaser shall
have delivered or caused to be delivered to the Parent and the Company the
following:

 

(i)            this Agreement duly executed by the
Purchaser;

 

(ii)           the Preferred Stock Consideration;
and

 

(iii)          the Purchaser’s Subscription
Securities, evidenced by delivery to the Company of a certificate or
certificates evidencing the Purchaser’s interest in units of USRP/HCI
Partnership 1, L.P.

 

(c)           All representations and warranties of
the other party contained herein shall remain true and correct as of the
applicable Closing Date.

 

(d)           There shall have been no Material
Adverse Effect (as defined in Section 3.1(b)) with respect to the Parent
and the Company from June 30, 2003 through the date hereof.

 

(e)           From the date hereof to the Closing
Date, trading in the Common Stock or the Preferred Stock shall not have been
suspended by the Commission (except for any suspension of trading of limited
duration agreed to by the Parent, which suspension shall be terminated prior to
the Closing), and, at any time prior to the Closing Date, trading in securities
generally as reported by Bloomberg Financial Markets shall not have been
suspended or limited, or minimum prices shall not have been established on
securities whose trades are reported by such service, or on the Principal
Market, nor shall a banking moratorium have been declared either by the United
States or New York State authorities, nor shall there have occurred any
material outbreak or escalation of hostilities or other national or
international calamity of such magnitude in its effect on, or any material
adverse change in, any financial market which, in each case, in the reasonable
judgment of the Purchaser, makes it impracticable or inadvisable to purchase the
shares of Preferred Stock at the Closing.

 

(f)            The Parent shall have entered into a
credit agreement (“Credit Agreement”) with Bank of America, N.A., as
agent (the “Agent”), and other lenders parties thereto (collectively,
the “Lenders”) in accordance with the terms of that certain commitment
letter dated October 2, 2003 (the “Commitment Letter”) between the
Company and the Lenders and that certain summary of terms and conditions
attached to the Commitment Letter.  On
the Closing Date, the Credit Agreement shall be in full force and effect.  The Credit Agreement shall provide for an
aggregate of not less than $50,000,000 of revolving credit commitments (of
which not less than $20,000,000 shall remain undrawn both before and after
giving effect to the transactions contemplated to occur on the Closing
Date).  On the Closing Date, the Parent
shall have issued a term loan note to the Agent in an amount of not less than
$35,000,000 under the Credit Agreement and shall have paid via wire transfer of
immediately available funds to the Agent the sum of $500,000 (the “Subscription
Fee”) in consideration for advisory services associated with transactions
contemplated under the Credit Agreement and this Agreement.  All of the terms and conditions of the
Credit Agreement and other documents related thereto shall be satisfactory to
the Purchaser.

 

(g)           On or before the Closing Date, the
Parent shall have prepared and filed with the Principal Market an additional
shares listing application covering (A) at least

 

5

 

404,350 shares of
Preferred Stock and (B) a number of shares of the Common Stock at least equal
to the Actual Minimum on the date of such application.

 

ARTICLE III

REPRESENTATIONS AND WARRANTIES

 

3.1           Representations and Warranties of
the Parent and Company.  Except as
set forth under the corresponding section of the disclosure schedules
delivered to the Purchaser concurrently herewith (the “Disclosure Schedules”),
the Parent and the Company hereby make the following representations and
warranties to the Purchaser:

 

(a)           Subsidiaries.  The Parent and the Company have no direct or
indirect subsidiaries.  The Parent and
the Company own, directly or indirectly, all of the capital stock or other
equity interests of each of their respective Subsidiaries free and clear of any
lien, charge, security interest, encumbrance, right of first refusal or other
restriction (collectively, “Liens”), and all the issued and outstanding
shares of capital stock of each Subsidiary are validly issued and are fully
paid, non-assessable and free of preemptive and similar rights.  If the Parent and the Company have no
subsidiaries, then references in the Transaction Documents to the Subsidiaries
will be disregarded.

 

(b)           Organization and Qualification.  Each of the Parent, the Company and their
respective Subsidiaries is an entity duly incorporated or otherwise organized,
validly existing, as applicable, and in good standing under the laws of the
jurisdiction of its incorporation or organization (as applicable), with the
requisite power and authority to own and use its properties and assets and to
carry on its business as currently conducted. 
Neither the Parent, the Company nor any of their respective Subsidiaries
is in violation of any of the provisions of its respective certificate or
articles of incorporation, bylaws or other organizational or charter
documents.  Each of the Parent, the
Company and their respective Subsidiaries is duly qualified to do business and
is in good standing as a foreign corporation or other entity in each
jurisdiction in which the nature of the business conducted or property owned by
it makes such qualification necessary, except where the failure to be so
qualified or in good standing, as the case may be, could not reasonably be
expected to, individually or in the aggregate: (i) adversely affect the
legality, validity or enforceability of any Transaction Document, (ii) have or
result in or be reasonably likely to have or result in a material adverse
effect on the results of operations, assets, business, condition or prospects
(financial or otherwise) of the Parent, the Company and their respective
Subsidiaries, taken as a whole, or (iii) adversely impair the Parent’s or the
Company’s ability to perform fully on a timely basis its obligations under any
of the Transaction Documents (any of (i), (ii) or (iii), a “Material Adverse
Effect”).

 

(c)           Authorization: Enforcement.  The Parent and the Company each has the
requisite corporate power and authority to enter into and to consummate the
transactions contemplated by each of the Transaction Documents and otherwise to
carry out its obligations hereunder or thereunder.  The execution and delivery of each of the Transaction Documents
by the Parent and the Company and the consummation by them of the transactions
contemplated hereby or thereby have been duly authorized by all necessary
action on the part of the Parent and the Company and no further consent or
action is required by the Parent or the Company, other than the Required Approvals.  Each of the Transaction Documents has been
(or upon delivery will be) duly executed by the Parent and the Company and,
when delivered in accordance with the terms hereof, will constitute the valid
and binding obligation of each of the Parent and the Company enforceable
against each of them in accordance with its terms, subject to applicable
bankruptcy,

 

6

 

insolvency, fraudulent
conveyance, reorganization, moratorium and similar laws affecting creditors’
rights and remedies generally and general principles of equity.

 

(d)           No Conflicts.  The execution, delivery and performance of
the Transaction Documents by the Parent and the Company and the consummation by
the Parent and the Company of the transactions contemplated thereby do not and
will not: (i) conflict with or violate any provision of the Parent’s, Company’s
or any of their respective Subsidiaries’ certificate or articles of
incorporation, bylaws or other organizational or charter documents, or (ii) subject
to obtaining the Required Approvals (as defined below), conflict with, or
constitute a default (or an event that with notice or lapse of time or both
would become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation (with or without notice, lapse of time
or both) of, any agreement, credit facility, debt or other instrument
(evidencing a Parent, Company or Subsidiary debt or otherwise) or other
understanding to which the Parent, Company or any of their respective
Subsidiaries is a party or by which any property or asset of the Parent,
Company or any of their respective Subsidiaries is bound or affected, or (iii)
result in a violation of any law, rule, regulation, order, judgment,
injunction, decree or other restriction of any court or governmental authority
as currently in effect to which the Parent, Company or their respective
Subsidiaries is subject (including federal and state securities laws and
regulations), or by which any property or asset of the Parent, Company or their
respective Subsidiaries is bound or affected; except in the case of each of
clauses (ii) and (iii), such as could not reasonably be expected to,
individually or in the aggregate, have or result in a Material Adverse Effect.

 

(e)           Filings.  Consents and Approvals. 
Neither the Parent, Company nor any of their respective Subsidiaries is
required to obtain any consent, waiver, authorization or order of, give any
notice to, or make any filing or registration with, any court or other federal,
state, local or other governmental authority or other Person in connection with
the execution, delivery and performance by the Parent and the Company of the
Transaction Documents, other than (i)  the Parent’s filing with the
Commission of the Prospectus Supplement, (ii) the application(s) to each
applicable Principal Market for the listing of the additional shares of
Preferred Stock for trading thereon in the time and manner required thereby,
and (iii) applicable Blue Sky filings (collectively, the “Required Approvals”).

 

(f)            Issuance of  the Securities.  The Securities are duly authorized and, when
issued and paid for in accordance with the applicable Transaction Documents,
will be duly and validly issued, fully paid and nonassessable, free and clear of
all Liens, other than any Liens created or permitted to exist by the
Purchaser.  The Parent has reserved from
its duly authorized capital stock a number of shares of Common Stock for
issuance of the Underlying Shares at least equal to the Actual Minimum on the
date hereof.

 

(g)           Capitalization.  The number of shares and type of all
authorized, issued and outstanding capital stock of the Parent is set forth in
the Disclosure Schedules.  No securities
of the Parent are entitled to preemptive or similar rights, and no Person has
any right of first refusal, preemptive right, right of participation, or any
similar right to participate in the transactions contemplated by the
Transaction Documents.  Except as a
result of the purchase and sale of the Securities, there are no outstanding
options other than as set forth in the SEC Reports, warrants, script rights to
subscribe to, calls or commitments of any character whatsoever relating to, or
securities, rights or obligations convertible into or exchangeable for, or giving
any Person any right to subscribe for or acquire, any shares of Common Stock,
or contracts, commitments, understandings or arrangements by which the Parent
or any Subsidiary is or may become bound

 

7

 

to issue additional
shares of Common Stock, or securities or rights convertible or exchangeable
into shares of Common Stock.  The
issuance and sale of the Securities will not obligate the Parent to issue
shares of Common Stock or other securities to any Person (other than the
Purchaser) and will not result in a right of any holder of the Parent
securities to adjust the exercise, conversion, exchange or reset price under
such securities.

 

(h)           Registration Statement.

 

(i)                                     The
Registration Statement has been declared effective by the Commission under the
Securities Act; no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceeding for that purpose has been
instituted or, to the knowledge of the Parent, threatened by the Commission;
and the Registration Statement and Prospectus Supplement (as amended or
supplemented if the Parent shall have furnished any amendments or supplements
thereto) comply, or will comply, as the case may be, in all material respects
with the Securities Act, and the rules and regulations of the Commission
thereunder, and do not and will not, as of the applicable effective date as to
the Registration Statement and any amendment thereto and as of the date of the
Prospectus Supplement and any amendment or supplement thereto, contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading, and the
Prospectus Supplement, as amended or supplemented at the Closing Date, if
applicable, will not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading.

 

(ii)                                  The
documents incorporated by reference in the Registration Statement, when they
were filed with the Commission, conformed in all material respects to the
requirements of the Exchange Act, and none of such documents contained an
untrue statement of a material fact or omitted to state a material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading.

 

(iii)                               The financial statements, and the related notes thereto, included or
incorporated by reference in the Registration Statement present fairly the
consolidated financial position of the Parent and its consolidated subsidiaries
as of the dates indicated and the results of their operations and the changes
in their consolidated cash flows for the periods specified; said financial
statements have been prepared in conformity with generally accepted accounting
principles applied on a consistent basis except as set forth in the notes thereto,
and the supporting schedules included or incorporated by reference in the
Registration Statement present fairly the information required to be stated
therein.

 

(iv)                              Since
the respective dates as of which information is given in the Registration
Statement or the Prospectus Supplement, there has not been

 

8

 

any material adverse change, or any development involving a prospective
material adverse change, in or affecting the general affairs, business, prospects,
financial position, stockholders’ equity or results of operations of the Parent
and its subsidiaries, taken as a whole, otherwise than as set forth or
contemplated in the Registration Statement or the Prospectus Supplement; and
except as set forth or contemplated in the Registration Statement or Prospectus
Supplement neither the Parent nor any of its subsidiaries has entered into any
transaction or agreement (whether or not in the ordinary course of business)
material to the Parent and its subsidiaries taken as a whole.

 

(i)            SEC Reports: Financial Statements.  Except as set forth in the Disclosure
Schedules, the Parent has filed all reports required to be filed by it under
the Securities Act and the Exchange Act, including pursuant to
Section 13(a) or 15(d) thereof, for the two years preceding the date
hereof (or such shorter period as the Parent was required by law to file such
material) (the foregoing materials being collectively referred to herein as the
“SEC Reports”) on a timely basis or has received a valid extension of
such time of filing and has filed any such SEC Reports prior to the expiration
of any such extension.  The Parent has
made available to the Purchaser a copy of all SEC Reports filed within the 10
days preceding the date hereof.  As of
their respective dates, the SEC Reports complied in all material respects with
the requirements of the Securities Act and the Exchange Act and the rules and
regulations of the Commission promulgated thereunder, and none of the SEC
Reports, when filed, contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading.  The
financial statements of the Parent included in the SEC Reports comply in all
material respects with applicable accounting requirements and the rules and
regulations of the Commission with respect thereto as in effect at the time of
filing.  Such financial statements have
been prepared in accordance with GAAP, except as may be otherwise specified in
such financial statements or the notes thereto, and fairly present in all
material respects the financial position of the Parent and its consolidated
subsidiaries as of and for the dates thereof and the results of operations and
cash flows for the periods then ended, subject, in the case of unaudited
statements, to normal, immaterial, year-end audit adjustments.

 

(j)            Material Changes.  Except as set forth in the Disclosure Schedules,
since the date of the latest audited financial statements included within the
SEC Reports, except as specifically disclosed in the SEC Reports or the
Prospectus Supplement: (i) there has been no event, occurrence or development
that has had or that could reasonably be expected to result in a Material
Adverse Effect, (ii) the Parent has not incurred any liabilities (contingent or
otherwise) other than (A) trade payables and accrued expenses incurred in the
ordinary course of business consistent with past practice and (B) liabilities
not required to be reflected in the Parent’s financial statements pursuant to
GAAP or required to be disclosed in filings made with the Commission, (iii) the
Parent has not altered its method of accounting or the identity of its
auditors, (iv) other than in the ordinary course of business, the Parent has
not declared or made any dividend or distribution of cash or other property to
its stockholders or purchased, redeemed or made any agreements to purchase or
redeem any shares of its capital stock, and (v) the Parent has not issued any
equity securities to any officer, director or Affiliate, except pursuant to
existing Parent stock option or similar plans.

 

(k)           Litigation.  There is no action, suit, inquiry, notice of
violation, proceeding or investigation pending or, to the knowledge of the
Parent, threatened against or affecting the

 

9

 

Parent, any Subsidiary or
any of their respective properties before or by any court, arbitrator,
governmental or administrative agency or regulatory authority (federal, state,
county, local or foreign) (collectively, an “Action”) which: (i)
adversely affects or challenges the legality, validity or enforceability of any
of the Transaction Documents or the Securities or (ii) could, if there were an
unfavorable decision, individually or in the aggregate, have or reasonably be
expected to result in a Material Adverse Effect.  Neither the Parent nor any Subsidiary, nor any director or
officer thereof, is or has been the subject of any Action involving a claim of
violation of or liability under federal or state securities laws or a claim of
breach of fiduciary duty.  The Parent
does not have pending before the Commission any request for confidential treatment
of information.  There has not been, and
to the knowledge of the Parent, there is not pending or contemplated, any
investigation by the Commission involving the Parent or any current or former
director or officer of the Parent.  The
Commission has not issued any stop order or other order suspending the
effectiveness of any registration statement filed by the Parent or any
Subsidiary under the Exchange Act or the Securities Act.

 

(l)            Compliance.  Except as set forth in the SEC Reports,
neither the Parent nor any Subsidiary: (i) is in default under or in violation
of (and no event has occurred that has not been waived that, with notice or
lapse of time or both, would result in a default by the Parent or any
Subsidiary under), nor has the Parent or any Subsidiary received notice of a
claim that it is in default under or that it is in violation of, any indenture,
loan or credit agreement or any other agreement or instrument to which it is a
party or by which it or any of its properties is bound (whether or not such
default or violation has been waived), (ii) is in violation of any order of any
court, arbitrator or governmental body, or (iii) is or has been in violation of
any statute, rule or regulation of any governmental authority, except in each
case as could not, individually or in the aggregate, have or result in a
Material Adverse Effect.

 

(m)          Labor Relations.  No material labor dispute exists or, to the
knowledge of the Parent, is imminent with respect to any of the employees of
the Parent.

 

(n)           Regulatory Permits.  The Parent and the Subsidiaries possess all
certificates, authorizations and permits issued by the appropriate federal,
state, local or foreign regulatory authorities necessary to conduct their
respective businesses as described in the SEC Reports, except where the failure
to possess such permits could not, individually or in the aggregate, have or
reasonably be expected to result in a Material Adverse Effect (“Material
Permits”), and neither the Parent nor any Subsidiary has received any
notice of proceedings relating to the revocation or modification of any
Material Permit.

 

(o)           Title to Assets.  Except as set forth in the Disclosure
Schedules, the Parent and the Subsidiaries have good and marketable title in
fee simple to all real property owned by them that is material to the business
of the Parent and the Subsidiaries and good and marketable title in all
personal property owned by them that is material to the business of the Parent
and the Subsidiaries, in each case free and clear of all Liens, except for
Liens as do not materially affect the value of such property and do not
materially interfere with the use made and proposed to be made of such property
by the Parent and the Subsidiaries. 
Except in each case as could not, individually or in the aggregate, have
or result in a Material Adverse Effect, any real property and facilities held
under lease by the Parent and the Subsidiaries are held by them under valid,
subsisting and enforceable leases of which the Parent and the Subsidiaries are
in material compliance.

 

10

 

(p)           Patents and Trademarks.  To the knowledge of the Parent, the Parent
and the Subsidiaries have, or have rights to use, all patents, patent
applications, trademarks, trademark applications, service marks, trade names,
copyrights, licenses and other similar rights that are necessary or material
for use in connection with their respective businesses as described in the SEC
Reports and which the failure to so have could have a Material Adverse Effect
(collectively, the “Intellectual Property Rights”).  Neither the Parent nor any Subsidiary has
received a written notice that the Intellectual Property Rights used by the
Parent or any Subsidiary violates or infringes upon the rights of any
Person.  To the knowledge of the Parent,
all such Intellectual Property Rights are enforceable and there is no existing
infringement by another Person of any of the Intellectual Property Rights.

 

(q)           Insurance.  The Parent and the Subsidiaries are insured
by insurers of recognized financial responsibility against such losses and
risks and in such amounts as are prudent and customary in the businesses in
which the Parent and the Subsidiaries are engaged.  A list of the Parent’s insurance contracts and policies are set
forth on the Disclosure Schedules.  To
the best of Parent’s knowledge, such insurance contracts and policies are
accurate and complete.  Neither the
Parent nor any Subsidiary has any knowledge that it will not be able to renew
its existing insurance coverage as and when such coverage expires or to obtain
similar coverage from similar insurers as may be necessary to continue its
business without a significant increase in cost.

 

(r)            Transactions With Affiliates and
Employees.  Except as set forth in
the SEC Reports, none of the executive officers or directors of the Parent and,
to the knowledge of the Parent, none of the employees of the Parent is
presently a party to any transaction with the Parent or any Subsidiary (other
than for services as employees, officers and directors), including any
contract, agreement or other arrangement providing for the furnishing of
services to or by, providing for rental of real or personal property to or
from, or otherwise requiring payments to or from any officer, director or such
employee or, to the knowledge of the Parent, any entity in which any officer,
director, or any such employee has a substantial interest or is an officer,
director, trustee or partner.

 

(s)           Internal Accounting Controls.  Except as set forth in the SEC Reports, the
Parent and the Subsidiaries maintain a system of internal accounting controls
sufficient to provide reasonable assurance that (i) transactions are executed
in accordance with management’s general or specific authorizations, (ii)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with GAAP and to maintain asset accountability, (iii)
access to assets is permitted only in accordance with management’s general or
specific authorization, and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.  There are no disagreements of any kind presently existing, or
reasonably anticipated by the Parent to arise, between the accountants and
lawyers formerly or presently employed by the Parent and the Parent is current
with respect to any fees owed to its accountants and lawyers.  Except as set forth in the SEC Reports, the
Parent has established disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the Parent and designed such
disclosures controls and procedures to ensure that material information
relating to the Parent, including its subsidiaries, is made known to the
certifying officers by others within those entities, particularly during the
period in which the Parent’s Form 10-K or 10-Q, as the case may be, is
being prepared.  The Parent’s certifying
officers have evaluated the effectiveness of the Parent’s controls and
procedures as of a date within 90 days prior to the filing date of the
Form 10-K for the fiscal year ended December 31, 2002 (such date, the
“Evaluation Date”).  The Parent
presented in the Form 10-K for the fiscal year ended December 31,
2002 the conclusions of the

 

11

 

certifying officers about the effectiveness of the
disclosure controls and procedures based on their evaluations as of the
Evaluation Date.  Since the Evaluation
Date, there have been no significant changes in the Parent’s internal controls
(as such term is defined in Item 307(b) of Regulation S-K under the
Exchange Act) or, the Parent’s knowledge, in other factors that could
significantly affect the Parent’s internal controls.

 

(t)            Solvency/Indebtedness.  Based on the financial condition of the
Parent as of the Closing Date: (i) the fair market value of the Parent’s assets
exceeds the amount that will be required to be paid on or in respect of the
Parent’s existing debts and other liabilities (including known contingent
liabilities) as they mature; (ii) the Parent’s assets do not constitute
unreasonably small capital to carry on its business for the current fiscal year
as now conducted and as proposed to be conducted including its capital needs
taking into account the particular capital requirements of the business
conducted by the Parent, and projected capital requirements and capital
availability thereof, and (iii) the current cash flow of the Parent, together with
the proceeds the Parent would receive, were it to liquidate all of its assets,
after taking into account all anticipated uses of the cash, would be sufficient
to pay all amounts on or in respect of its debt when such amounts are required
to be paid.  The Parent does not intend
to incur debts beyond its ability to pay such debts as they mature (taking into
account the timing and amounts of cash to be payable on or in respect of its
debt).  The Parent has no knowledge of
any facts or circumstances which lead it to believe that it will file for
reorganization or liquidation under the bankruptcy or reorganization laws of
any jurisdiction within one year from the Closing Date.  The SEC Reports set forth as of the date thereof
all outstanding secured and unsecured Indebtedness of the Parent or any
Subsidiary, or for which the Parent or any Subsidiary has commitments.  For the purposes of this Agreement, “Indebtedness”
shall mean (a) any liabilities for borrowed money or amounts owed in excess of
$50,000 (other than trade accounts payable incurred in the ordinary course of
business), (b) all guaranties, endorsements and other contingent obligations in
respect of Indebtedness of others, whether or not the same are or should be
reflected in the Parent’s balance sheet (or the notes thereto), except
guaranties by endorsement of negotiable instruments for deposit or collection
or similar transactions in the ordinary course of business; and (c) the present
value of any lease payments in excess of $50,000 due under leases required to
be capitalized in accordance with GAAP. 
Neither the Parent nor any Subsidiary is in default with respect to any
Indebtedness.

 

(u)           Certain Fees.  No brokerage or finder’s fees or commissions
are or will be payable by the Parent to any broker, financial advisor or
consultant, finder, placement agent, investment banker, bank or other Person
with respect to the transactions contemplated by this Agreement, and the Parent
has not taken any action that would cause any Purchaser to be liable for any such
fees or commissions.  The Parent agrees
that the Purchaser shall have no obligation with respect to any fees or with
respect to any claims made by or on behalf of any Person for fees of the type
contemplated by this Section with the transactions contemplated by this
Agreement.

 

(v)           Principal Market; Approvals.  The issuance and sale of the Preferred Stock
hereunder does not contravene the rules and regulations of the Principal Market
and no Stockholder Approval is required (i) in connection with the issuance and
sale of the Preferred Stock contemplated by this Agreement, and (ii) for the
Parent to fulfill its obligations under the Transaction Documents.

 

(w)          Listing and Maintenance
Requirements.  Except as set forth
in the Disclosure Schedules, the Parent has not, in the 12 months preceding the
date hereof, received notice from any Principal Market on which the Common
Stock or Preferred Stock is or has been listed or

 

12

 

quoted to the effect that the Parent is not in
compliance with the listing or maintenance requirements of such Principal
Market.  The Parent is, and has no
reason to believe that it will not in the foreseeable future continue to be, in
compliance with all such listing and maintenance requirements.

 

(x)            Registration Rights.  Except as set forth in the Disclosure
Schedules, the Parent has not granted or agreed to grant to any Person any
rights (including “piggy-back” registration rights) to have any securities of
the Parent registered with the Commission or any other governmental authority
that have not been satisfied.

 

(y)           Application of Takeover
Protections.  The Parent and its
Board of Directors have taken all necessary action, if any, in order to render
inapplicable any control share acquisition, business combination, poison pill
(including any distribution under a rights agreement) or other similar
anti-takeover provision under the Parent’s Restated Articles of Incorporation
(or similar charter documents) or the laws of its state of incorporation that
is or could become applicable to the Purchaser as a result of the Purchaser and
the Parent fulfilling their obligations or exercising their rights under the
Transaction Documents, including without limitation as a result of the Parent’s
issuance of the Securities and the Purchaser’s ownership of the Securities.

 

(z)            Disclosure.  The Parent confirms that neither it nor any
other Person acting on its behalf has provided the Purchaser or its agents or
counsel with any information that constitutes or might constitute material,
nonpublic information.  The Parent
understands and confirms that the Purchaser will rely on the foregoing
representations in effecting transactions in securities of the Parent.  All disclosure provided to the Purchaser
regarding the Parent, its business and the transactions contemplated hereby,
including the Schedules to this Agreement, furnished by or on behalf of
the Parent with respect to the representations and warranties made herein are
true and correct with respect to such representations and warranties and do not
contain any untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements made therein, in light of the
circumstances under which they were made, not misleading.  The Parent acknowledges and agrees that the
Purchaser does not make or has not made any representations or warranties with
respect to the transactions contemplated hereby other than those specifically
set forth in Section 3.2.

 

(aa)         Form S-3 Eligibility.  The eligibility requirements for use of Form
S-3, including both the registrant and the transaction requirements of General
Instructions I. A. and I. B. of Form S-3 promulgated under the Securities Act,
are satisfied for purposes of registering the Preferred Stock for sale to the
Purchaser.

 

(bb)         Seniority.  As of the date of this Agreement, no other
equity of the Parent is senior to the Preferred Stock in right of payment,
whether with respect to interest or upon liquidation or dissolution, or
otherwise.

 

(cc)         Tax Status.  The Parent and each of its Subsidiaries has
made or filed all material federal, state and foreign income and all other
material tax returns, reports and declarations required by any jurisdiction to
which it is subject (unless and only to the extent that the Parent and each of
its Subsidiaries has set aside on its books provisions reasonably adequate for
the payment of all unpaid and unreported taxes) and has paid all taxes and
other governmental assessments and charges that are material in amount, shown
or determined to be due on such returns, reports and declarations, except those
being contested in good faith and has set aside on its books provisions
reasonably adequate for the payment of all taxes for periods subsequent to

 

13

 

the periods to which such returns, reports or
declarations apply.  There are no unpaid
taxes in any material amount claimed to be due by the taxing authority of any
jurisdiction, and the officers of the Parent know of no basis for any such
claim.  The Parent has not executed a
waiver with respect to the statute of limitations relating to the assessment or
collection of any foreign, federal, statue or local tax.  None of the Parent’s tax returns is
presently being audited by any taxing authority.

 

(dd)         Acknowledgment Regarding Purchaser’s
Purchase of Securities.  The Parent
acknowledges and agrees that the Purchaser is acting solely in the capacity of
an arm’s length purchaser with respect to this Agreement and the transactions
contemplated hereby.  The Parent further
acknowledges that the Purchaser is not acting as a financial advisor or
fiduciary of the Parent (or in any similar capacity) with respect to this
Agreement and the transactions contemplated hereby and any statement made by
the Purchaser or any of its respective representatives or agents in connection
with this Agreement and the transactions contemplated hereby is not advice or a
recommendation and is merely incidental to the Purchaser’s purchase of the Preferred
Stock.  The Parent further represents to
the Purchaser that the Parent’s decision to enter into this Agreement has been
based solely on the independent evaluation of the Parent and its
representatives.

 

(ee)         Acknowledgment of Dilution.  The Parent acknowledges that the issuance of
the Securities will result in dilution of the outstanding shares of Common
Stock, which dilution may be substantial under certain market conditions.  The Parent further acknowledges that its
obligations under the Transaction Documents, including without limitation its
obligation to issue the Underlying Shares pursuant to the Transaction
Documents, are unconditional and absolute and not subject to any right of set
off, counterclaim, delay or reduction, regardless of the effect of any such
dilution and regardless of the dilutive effect that such issuance may have on
the ownership of the other stockholders of the Parent.

 

(ff)           Representations and Warranties in
Other Agreements.  The
representations and warranties made by the Parent and its subsidiaries in the
Credit Agreement and in any other agreements, instruments or certificates
delivered pursuant hereto or thereto, are true and correct in all material
respects (except where any such representation and warranty is stated as being
true only as of a specific date, in which case such representation and warranty
was true and correct in all material respects on such date).

 

3.2           Representations and Warranties of
the Purchaser.  The Purchaser hereby
represents and warrants to the Parent and the Company as follows:

 

(a)           Organization: Authority.  The Purchaser is an entity duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
organization with the requisite corporate or partnership power and authority to
enter into and to consummate the transactions contemplated by the Transaction
Documents and otherwise to carry out its obligations thereunder.  The purchase by the Purchaser of the
Securities hereunder has been duly authorized by all necessary action on the
part of the Purchaser.  Each of this
Agreement and the Registration Agreement has been duly executed by such
Purchaser, and when delivered by the Purchaser in accordance with the terms
hereof, will constitute the valid and legally binding obligation of the
Purchaser, enforceable against it in accordance with its terms.

 

(b)           Ownership of the Limited Partner
Interest; Encumbrances.  As of the
date hereof, the Purchaser is the holder of record and beneficial owner of
one-hundred percent (100%) of the

 

14

 

Subscription Securities.  At the Closing, the Company will receive good and valid title to
the Subscription Securities, free and clear of any liens, charges, pledges,
encumbrances, claims, security interests, restrictions, rights of first
refusal, defects in title or options of any kind.

 

ARTICLE IV

OTHER AGREEMENTS OF THE PARTIES

 

4.1           Transfer Restrictions.

 

(a)           The Purchaser agrees to the
imprinting of the following legend on any certificate evidencing the
Securities:

 

THE SECURITIES
REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON OWNERSHIP AND
TRANSFER FOR THE PURPOSE OF THE COMPANY’S MAINTENANCE OF ITS STATUS AS A REAL
ESTATE INVESTMENT TRUST UNDER THE INTERNAL REVENUE CODE OF 1986, AS AMENDED
(THE “CODE”). EXCEPT AS OTHERWISE PROVIDED PURSUANT TO THE CHARTER OF THE
CORPORATION, NO PERSON MAY (1) BENEFICIALLY OWN SHARES OF STOCK IN EXCESS
OF 9.8% (OR SUCH OTHER PERCENTAGE AS MAY BE PROVIDED IN THE CHARTER OF THE
CORPORATION) OF THE AGRREGATE VALUE OF ALL OUTSTANDING STOCK OR (2)
BENEFICIALLY OWN STOCK THAT WOULD RESULT IN THE COMPANY BEING “CLOSELY HELD”
UNDER SECTION 856(h) OF THE CODE. ANY PERSON WHO ATTEMPTS TO BENEFECIALLY
OWN SHARES OF STOCK IN EXCESS OF THE ABOVE LIMITATIONS MUST IMMEDIATELY NOTIFY
THE COMPANY. IF THE RESTRICTIONS ON OWNERSHIP OR TRANSFER ARE VIOLATED, THE
SHARES OF STOCK REPRESENTED HEREBY WILL BE AUTOMATICALLY CONVERTED INTO SHARES
OF EXCESS STOCK WHICH WILL BE HELD IN TRUST BY THE COMPANY. THE COMPANY HAS THE
OPTION TO REDEEM SHARES OF EXCESS STOCK UNDER CERTAIN CIRCUMSTANCES. ALL TERMS
IN THIS LEGEND NOT OTHERWISE DEFINED HEREIN HAVE THE MEANINGS ASCRIBED THERETO
IN THE COMPANY’S CHARTER, AS THE SAME MAY BE FURTHER AMENDED FROM TIME TO
TIME, A COPY OF WHICH, INCLUDING THE RESTRICTIONS ON OWNERSHIP AND TRANSFER,
WILL BE SENT WITHOUT CHARGE TO EACH STOCKHOLDER WHO SO REQUESTS.

 

(b)           Certificates evidencing Underlying
Shares shall not contain any legend (other than the legend described in
Section 4.1(a)): (i) while a registration statement (including the
Registration Statement and Underlying Shares Registration Statement) covering
the resale of the Preferred Stock or the Underlying Shares, as the case may be,
is effective under the Securities Act, or (ii) following any sale of the
Securities pursuant to Rule 144, or (iii) if such Securities are
eligible for sale under Rule 144(k), or (iv) if such legend is not
required under applicable requirements of the Securities Act (including
judicial interpretations and pronouncements issued by the Staff of the
Commission).  If all or any shares of
Preferred Stock are converted at a time when there is an effective registration
statement to cover the resale of the Underlying Shares, or if such Underlying
Shares may be sold under Rule 144(k) or if such legend is not otherwise
required under applicable requirements of the Securities Act (including
judicial interpretations thereof) then such Underlying Shares shall be issued
free of all legends.  The Parent agrees
that following the Effective Date or at such time as such legend is no longer
required under this Section 4.1(c), it will, no later than three Trading
Days following the delivery by a Purchaser to

 

15

 

the Parent or the
Parent’s transfer agent of a certificate representing Securities issued with a
restrictive legend, deliver or cause to be delivered to the Purchaser a
certificate representing such Securities that is free from all restrictive and
other legends.  The Parent may not make
any notation on its records or give instructions to any transfer agent of the
Parent that enlarge the restrictions on transfer set forth in this Section.

 

4.2           Furnishing of Information.  As long as the Purchaser owns Securities,
the Parent covenants to timely file (or obtain extensions in respect thereof
and file within the applicable grace period) all reports required to be filed
by the Parent after the date hereof pursuant to the Exchange Act.  Upon the request of any Purchaser, the
Parent shall deliver to such Purchaser a written certification of a duly
authorized officer as to whether it has complied with the preceding
sentence.  As long as any Purchaser owns
Securities, if the Parent is not required to file reports pursuant to such
laws, it will prepare and furnish to the Purchaser and make publicly available
in accordance with Rule 144(c) such information as is required for the
Purchaser to sell the Securities under Rule 144.  The Parent further covenants that it will take such further
action as any holder of Securities may reasonably request, all to the extent
required from time to time to enable such Person to sell such Securities
without registration under the Securities Act within the limitation of the
exemptions provided by Rule 144.

 

4.3           Integration.  The Parent shall not, and shall use its
commercially reasonable efforts to ensure that no Affiliate of the Parent
shall, sell, offer for sale or solicit offers to buy or otherwise negotiate in
respect of any security (as defined in Section 2 of the Securities Act)
that would be integrated with the offer or sale of the Securities in a manner
that would require the registration under the Securities Act of the sale of the
Securities to the Purchaser, or that would be integrated with the offer or sale
of the Securities for purposes of the rules and regulations of any Principal
Market.

 

4.4           Reservation and Listing of
Securities.

 

(a)           The Parent shall maintain a reserve
from its duly authorized shares of Common Stock for issuance pursuant to the
Transaction Documents in such amount as may be required to fulfill its
obligations in full under the Transaction Documents.

 

(b)           If, on any date, the number of
authorized but unissued (and otherwise unreserved) shares of Common Stock is
less than the Actual Minimum on such date, minus (ii) the number of shares of
Common Stock previously issued pursuant to the Transaction Documents, then the
Board of Directors of the Parent shall use commercially reasonable efforts to
amend the Parent’s certificate or articles of incorporation to increase the
number of authorized but unissued shares of Common Stock to at least the Actual
Minimum at such time (minus the number of shares of Common Stock previously
issued pursuant to the Transaction Documents), as soon as possible and in any
event not later than the 75th day after such date; provided that the Parent
will not be required at any time to authorize a number of shares of Common
Stock greater than the maximum remaining number of shares of Common Stock that
could possibly be issued after such time pursuant to the Transaction Documents.

 

(c)           The Parent shall: (i) take all steps
necessary to cause such shares of Preferred Stock and Common Stock to be
approved for listing on the Principal Market as soon as possible after the
Closing Date, (ii) provide to the Purchaser evidence of such listing, and (iii)
use reasonable efforts to maintain the listing of such Preferred Stock and
Common Stock on such Principal Market or another Principal Market.

 

16

 

4.5           Securities Laws Disclosure:
Publicity.  The Parent shall, within
one Trading Day after the Closing Date, issue a press release or file a Current
Report on Form 8-K reasonably acceptable to the Purchaser disclosing all
material terms of the transactions contemplated hereby.  The Parent and the Purchaser shall consult
with each other in issuing any press releases with respect to the transactions
contemplated hereby.  Notwithstanding
the foregoing, other than in the Registration Statement and filings related
thereto, the Parent shall not publicly disclose the name of the Purchaser or
the terms hereof, or include the name of the Purchaser or the terms hereof in
any filing with the Commission or any regulatory agency or Principal Market,
without the prior written consent of such Purchaser, except to the extent such
disclosure is required by law or Principal Market regulations, in which case
the Parent shall provide the Purchaser with prior notice of such disclosure.

 

4.6           Non-Public Information.  The Parent covenants and agrees that neither
it nor any other Person acting on its behalf will provide the Purchaser or its
agents or counsel with any information that the Parent believes constitutes
material non-public information, unless prior thereto the Purchaser shall have
executed a written agreement regarding the confidentiality and use of such
information.  The Parent understands and
confirms that the Purchaser shall be relying on the foregoing representations
in effecting transactions in securities of the Parent.

 

4.7           Reimbursement.  If the Purchaser becomes involved in any
capacity in any Proceeding by or against any Person who is a stockholder of the
Parent, solely as a result of such Purchaser’s acquisition of the Preferred
Stock under this Agreement and without causation by any other activity,
obligation, condition or liability pertaining to the Purchaser and not to the
transactions contemplated by this Agreement, the Parent will reimburse the
Purchaser, to the extent such reimbursement is not provided for in
Section 4.8, for its reasonable legal and other expenses (including the
cost of any investigation preparation and travel in connection therewith)
incurred in connection therewith, as such expenses are incurred.  The reimbursement obligations of the Parent
under this paragraph shall be in addition to any liability which the Parent may
otherwise have, shall extend upon the same terms and conditions to any
Affiliates of the Purchaser who are actually named in such action, proceeding
or investigation, and partners, directors, agents, employees and controlling
persons (if any), as the case may be, of the Purchaser and any such Affiliate,
and shall be binding upon and inure to the benefit of any successors, assigns,
heirs and personal representatives of the Parent, the Purchaser and any such
Affiliate and any such Person.  The
Parent also agrees that neither the Purchaser nor any such Affiliates,
partners, directors, agents, employees or controlling persons shall have any
liability to the Parent or any Person asserting claims on behalf of or in right
of the Parent solely as a result of acquiring the Preferred Stock under this
Agreement.

 

4.8           Indemnification of Purchaser.  Subject to the provisions of this
Section 4.8, the Parent and the Company will indemnify and hold the
Purchaser and its directors, officers, shareholders, partners, employees and
agents (each, a “Purchaser Party”) harmless from any and all losses,
liabilities, obligations, claims, contingencies, damages, costs and expenses,
including all judgments, amounts paid in settlements, court costs and
reasonable attorneys’ fees and costs of investigation that any such Purchaser
Party may suffer or incur as a result of or relating to any breach of any of
the representations, warranties, covenants or agreements made by the Parent and
the Company in this Agreement or in the other Transaction Documents.  If any action shall be brought against any
Purchaser Party in respect of which indemnity may be sought pursuant to this
Agreement, such Purchaser Party shall promptly notify the Parent in writing,
and the Parent and/or the Company shall have the right to assume the defense
thereof with counsel of its own choosing. 
Any Purchaser Party shall have the right to employ separate counsel in
any such action and participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such Purchaser Party except
to the extent that (i) the employment thereof has been specifically authorized
by the Parent in writing, (ii) the Parent or the Company has

 

17

 

failed after a reasonable period of time to assume such defense and to
employ counsel or (iii) in such action there is, in the reasonable opinion of
such separate counsel, a material conflict on any material issue between the
position of the Parent or the Company and the position of such Purchaser
Party.  The Parent and the Company will
not be liable to any Purchaser Party under this Agreement (i) for any
settlement by an Purchaser Party effected without the Parent’s prior written
consent; or (ii) to the extent that any loss, claim, damage or liability is
attributable to any Purchaser Party’s breach of any of the representations,
warranties, covenants or agreements made by the Purchaser in this Agreement or
in the other Transaction Documents.

 

4.9           Indemnification of Parent and
Company.  Subject to the provisions
of this Section 4.9, the Purchaser will indemnify and hold the Parent and
the Company and each of their respective directors, officers, shareholders,
partners, employees and agents (each, a “Parent-Company Party”) harmless
from any and all losses, liabilities, obligations, claims, contingencies,
damages, costs and expenses, including all judgments, amounts paid in
settlements, court costs and reasonable attorneys’ fees and costs of
investigation that any such Parent-Company Party may suffer or incur as a
result of or relating to any breach of any of the representations, warranties,
covenants or agreements made by the Purchaser in this Agreement or in the other
Transaction Documents, other than the Credit Agreement.  If any action shall be brought against any
Parent-Company Party in respect of which indemnity may be sought pursuant to
this Agreement, such Parent-Company Party shall promptly notify the Purchaser
in writing, and the Purchaser shall have the right to assume the defense
thereof with counsel of its own choosing. 
Any Parent-Company Party shall have the right to employ separate counsel
in any such action and participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such Parent-Company Party
except to the extent that (i) the employment thereof has been specifically
authorized by the Purchaser in writing, (ii) the Purchaser has failed after a
reasonable period of time to assume such defense and to employ counsel or (iii)
in such action there is, in the reasonable opinion of such separate counsel, a
material conflict on any material issue between the position of the Purchaser
and the position of such Parent-Company Party. 
The Purchaser will not be liable to any Parent-Company Party under this
Agreement (i) for any settlement by an Parent-Company Party effected without
the Purchaser’s prior written consent; or (ii) to the extent that any loss,
claim, damage or liability is attributable to any Parent-Company Party’s breach
of any of the representations, warranties, covenants or agreements made by the
Parent or the Company in this Agreement or in the other Transaction Documents.

 

4.10         Shareholders Rights Plan.  In the event that a shareholders rights plan
is adopted by the Parent, no claim will be made or enforced by the Parent or
any other Person that any Purchaser is an “Acquiring Person” under the plan or
in any way could be deemed to trigger the provisions of such plan by virtue of
receiving Securities under the Transaction Documents.

 

ARTICLE V

MISCELLANEOUS

 

5.1           Reserved.

 

5.2           Fees and Expenses.  The Parent agrees to reimburse the Purchaser
for all of its out of pocket costs and expenses (including reasonable fees and
expenses of its counsel) incurred in connection with the transactions
contemplated by this Agreement on or prior to the Closing.  The Parent shall pay the fees and expenses
of its advisers, counsel, accountants and other experts, if any, and all other
expenses incurred by such party incident to the negotiation, preparation,
execution, delivery and performance of this Agreement.  The Parent shall pay all transfer agent
fees, stamp taxes and other taxes and duties levied in connection with the
issuance of any Securities.

 

18

 

5.3           Entire Agreement.  The Transaction Documents, together with the
exhibits and schedules thereto, contain the entire understanding of the parties
with respect to the subject matter hereof and supersede all prior agreements
and understandings, oral or written, with respect to such matters, which the
parties acknowledge have been merged into such documents, exhibits and
schedules.

 

5.4           Notices.  Any and all notices or other communications
or deliveries required or permitted to be provided hereunder shall be in
writing and shall be deemed given and effective on the earliest of (a) the date
of transmission, if such notice or communication is delivered via facsimile at
the facsimile number specified on the signature pages hereto prior to
5:30 p.m.  (New York City time) on
a Trading Day, (b) the next Trading Day after the date of transmission, if such
notice or communication is delivered via facsimile at the facsimile number
specified in this Section on a day that is not a Trading Day or later than
5:30 p.m.  (New York City time) on
any Trading Day, or (c) the Trading Day following the date of mailing, if sent by
U.S.  nationally recognized overnight
courier service.  The addresses for such
notices and communications are those set forth on the signature pages hereof,
or such other address as may be designated in writing hereafter, in the same
manner, by such Person.

 

5.5           Amendments: Waivers.  No provision of this Agreement may be waived
or amended except in a written instrument signed, in the case of an amendment,
by the Parent, Company and the Purchaser or, in the case of a waiver, by the
party against whom enforcement of any such waiver is sought.  No waiver of any default with respect to any
provision, condition or requirement of this Agreement shall be deemed to be a
continuing waiver in the future or a waiver of any subsequent default or a
waiver of any other provision, condition or requirement hereof, nor shall any
delay or omission of either party to exercise any right hereunder in any manner
impair the exercise of any such right.

 

5.6           Construction.  The headings herein are for convenience
only, do not constitute a part of this Agreement and shall not be deemed to
limit or affect any of the provisions hereof. 
The language used in this Agreement will be deemed to be the language
chosen by the parties to express their mutual intent, and no rules of strict
construction will be applied against any party.

 

5.7           Successors and Assigns.  This Agreement shall be binding upon and
inure to the benefit of the parties and their successors and permitted
assigns.  The Parent and the Company may
not assign this Agreement or any rights or obligations hereunder without the
prior written consent of the Purchaser. 
The Purchaser may assign its rights under this Agreement to any Person
to whom such Purchaser assigns or transfers any Securities.

 

5.8           No Third-Party Beneficiaries.  This Agreement is intended for the benefit
of the parties hereto and their respective successors and permitted assigns and
is not for the benefit of, nor may any provision hereof be enforced by, any
other Person, except as otherwise set forth in Section 4.8.

 

5.9           Governing Law: Venue: Waiver of
Jury Trial.  All questions
concerning the construction, validity, enforcement and interpretation of this
Agreement shall be governed by and construed and enforced in accordance with
the internal laws of the State of New York, without regard to the principles of
conflicts of law thereof.  Each party
hereby irrevocably submits to the exclusive jurisdiction of the state and
federal courts sitting in the City of New York, borough of Manhattan, for the
adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein (including with respect to
the enforcement of any of the Transaction Documents), and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that
such suit, action or proceeding is improper or inconvenient venue for such
proceeding.  Each party hereby
irrevocably

 

19

 

waives personal service of process and consents to process being served
in any such suit, action or proceeding by mailing a copy thereof via registered
or certified mail or overnight delivery (with evidence of delivery) to such
party at the address in effect for notices to it under this Agreement and
agrees that such service shall constitute good and sufficient service of
process and notice thereof.  Nothing
contained herein shall be deemed to limit in any way any right to serve process
in any manner permitted by law.  The
parties hereby waive all rights to a trial by jury.  If either party shall commence an action or proceeding to enforce
any provisions of this Agreement, then the prevailing party in such action or
proceeding shall be reimbursed by the other party for its attorneys fees and
other costs and expenses incurred with the investigation, preparation and
prosecution of such action or proceeding.

 

5.10         Survival.  The representations, warranties, agreements
and covenants contained herein shall survive the Closing and the delivery,
exercise and/or conversion of the Securities, as applicable.

 

5.11         Execution.  This Agreement may be executed in two or
more counterparts, all of which when taken together shall be considered one and
the same agreement and shall become effective when counterparts have been
signed by each party and delivered to the other party, it being understood that
both parties need not sign the same counterpart.  In the event that any signature is delivered by facsimile transmission,
such signature shall create a valid and binding obligation of the party
executing (or on whose behalf such signature is executed) with the same force
and effect as if such facsimile signature page were an original thereof.

 

5.12         Severability.  If any provision of this Agreement is held
to be invalid or unenforceable in any respect, the validity and enforceability
of the remaining terms and provisions of this Agreement shall not in any way be
affected or impaired thereby and the parties will attempt to agree upon a valid
and enforceable provision that is a reasonable substitute therefor, and upon so
agreeing, shall incorporate such substitute provision in this Agreement.

 

5.13         Rescission and Withdrawal Right.  Notwithstanding anything to the contrary
contained in (and without limiting any similar provisions of) the Transaction
Documents, whenever the Purchaser exercises a right, election, demand or option
under a Transaction Document and the Parent and/or the Company does not timely
perform their related obligations within the periods therein provided, then the
Purchaser may rescind or withdraw, in its sole discretion from time to time
upon written notice to the Parent, any relevant notice, demand or election in
whole or in part without prejudice to its future actions and rights; provided,
however, in the case of a rescission of a conversion of the Preferred
Stock, the Purchaser shall be required to return any shares of Common Stock
subject to such conversion or exercise notice.

 

5.14         Replacement of Securities.  If any certificate or instrument evidencing
any Securities is mutilated, lost, stolen or destroyed, the Parent shall issue
or cause to be issued in exchange and substitution for and upon cancellation
thereof, or in lieu of and substitution therefor, a new certificate or
instrument, but only upon receipt of evidence reasonably satisfactory to the
Parent of such loss, theft or destruction and customary and reasonable
indemnity, if requested.  The applicants
for a new certificate or instrument under such circumstances shall also pay any
reasonable third-party costs associated with the issuance of such replacement
Securities.

 

5.15         Remedies.  In addition to being entitled to exercise
all rights provided herein or granted by law, including recovery of damages,
the Purchaser, the Parent and the Company will be entitled to specific
performance under the Transaction Documents. 
The parties agree that monetary damages may not be adequate compensation
for any loss incurred by reason of any breach of obligations described in

 

20

 

the foregoing sentence and hereby agrees to waive in any action for
specific performance of any such obligation the defense that a remedy at law
would be adequate.

 

5.16         Payment Set Aside.  To the extent that the Parent or the Company
makes a payment or payments to the Purchaser pursuant to any Transaction
Document or the Purchaser enforces or exercises its rights thereunder, and such
payment or payments or the proceeds of such enforcement or exercise or any part
thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside, recovered from, disgorged by or are required to be
refunded, repaid or otherwise restored to the Parent or the Company, as the
case may be, a trustee, receiver or any other person under any law (including,
without limitation, any bankruptcy law, state or federal law, common law or
equitable cause of action), then to the extent of any such restoration the
obligation or part thereof originally intended to be satisfied shall be revived
and continued in full force and effect as if such payment had not been made or
such enforcement or setoff had not occurred.

 

5.17         Liquidated Damages.  The Parent’s and the Company’s obligations
to pay any liquidated damages or other amounts owing under the Transaction
Documents is a continuing obligation of the Parent and the Company and shall
not terminate until all unpaid liquidated damages and other amounts have been
paid notwithstanding the fact that the instrument or security pursuant to which
such liquidated damages or other amounts are due and payable shall have been
canceled.

 

5.18         Tax Information.  Notwithstanding any provisions herein to the
contrary or in any other agreement to which a party hereto is bound, the
parties hereto and their respective Affiliates (and the respective partners,
directors, officers, employees, agents, advisors and other representatives of
each of the foregoing and their Affiliates) may disclose to any and all
Persons, without limitation of any kind the “tax treatment” or “tax structure”
(as those terms are defined in Treasury Regulation   1.6011-4(c)(8) and (9), respectively) of the transactions
contemplated hereby and (b) all materials of any kind (including opinions or
other tax analyses) relating to such tax treatment  or tax structure or facts that are provided to any of the Persons
referred to above, except that “tax treatment” or “tax structure” shall not
include the identity of an existing or future party or its Affiliates.

 

[SIGNATURE PAGE
FOLLOWS]

 

21

 

IN WITNESS WHEREOF, the
parties hereto have caused this Securities Purchase Agreement to be duly
executed by their respective authorized signatories as of the date first
indicated above.

 

 

	
   

  	
  U.S. RESTAURANT PROPERTIES, INC.

  
	
   

  
	
   

  
	
   

  	
  By:

  	
  /s/ Stacy M.
  Riffe

  	
   

  
	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
  Title:

  	
  Chief Financial
  Officer

  
						

 

Address for Notice:

12240 Inwood Road, Suite
300

Dallas, Texas 75244

Attn:       Chief Financial Officer

Tel:         (972) 387-1487

Fax:         (972) 490-9119

 

With a copy to:

Kenneth L. Betts

Locke Liddell & Sapp
LLP

2200 Ross Avenue, Suite
2200

Dallas, Texas 75201

Tel:         (214) 740-8743

Fax:         (214) 740-8800

 

22

 

IN WITNESS WHEREOF, the
parties hereto have caused this Securities Purchase Agreement to be duly
executed by their respective authorized signatories as of the date first
indicated above.

 

 

	
   

  	
  USRP (JV1), LLC

  
	
   

  
	
   

  
	
   

  	
  By:

  	
  /s/ Stacy M.
  Riffe

  	
   

  
	
   

  	
  Name:

  	
  Stacy M. Riffe

  
	
   

  	
  Title:

  	
  Chief Financial
  Officer

  
						

 

Address for Notice:

c/o U.S. Restaurant
Properties, Inc.

12240 Inwood Road, Suite
300

Dallas, Texas 75244

Attn:       Chief Financial Officer

Tel:         (972) 387-1487

Fax:         (972) 490-9119

 

With a copy to:

Kenneth L. Betts

Locke Liddell & Sapp
LLP

2200 Ross Avenue, Suite
2200

Dallas, Texas 75201

Tel:         (214) 740-8743

Fax:         (214) 740-8800

 

23

 

IN WITNESS WHEREOF, the
undersigned have caused this Securities Purchase Agreement to be duly executed
by their respective authorized signatories as of the date first indicated
above.

 

	
   

  	
  HARBILAN CORPORATION

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

Address for Notice:

Harbilan Corporation

c/o Banc of America
Securities, LLC

100 N. Tryon St.

NC1-007-11-07

Charlotte, NC  28255

Attention: Robert W.
Long, Jr., Managing Director

Tel:         (704) 386-8467

Fax:         (704) 386-3215

 

 

With a copy to:

John S. Chinuntdet

Moore & Van Allen,
PLLC

100 North Tryon Street

Suite 4700

Charlotte, NC  28202

Tel:         (704) 331-3502

Fax:         (704) 378-1950

 

 

 

[PURCHASER’S
SIGNATURE PAGE]

 

24

 

Exhibit A

 

Articles
Supplementary

 

25

 

Exhibit B

 

Form of Legal
Opinion

 

26

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