Document:

Exhibit
10.7

 

PARTIAL RELEASE AND ACKNOWLEDGEMENT AGREEMENT

 

This Partial
Release and Acknowledgment Agreement (the “Agreement”) is entered into as of June 15,
2005, by and among (i) SILICON VALLEY BANK,
a California chartered bank, with its principal place of business at
3003 Tasman Drive, Santa Clara, California 95054 and with a loan
production office located at One Newton Executive Park, Suite 200, 2221
Washington Street, Newton, Massachusetts 
02462 (“SVB”), (ii) ASPEN TECHNOLOGY,
INC., a Delaware corporation with offices at Ten Canal Park,
Cambridge, Massachusetts 02141 and (iii) ASPENTECH,
INC., a Texas corporation with offices at Ten Canal Park, Cambridge,
Massachusetts 02141 (jointly and severally, individually and collectively, “Borrower”),
and the parties who have executed this Agreement, as evidenced by their
signature below (each a “Party”, and collectively, the “Parties”).

 

Whereas,
Borrower is indebted to SVB pursuant to a loan arrangement dated as of January 30,
2003, as evidenced by a certain Loan and Security Agreement and a certain
Export-Import Bank Loan and Security Agreement each dated as of January 30,
2003 (each as amended and in effect, collectively, the “SVB Loan Arrangement”)
and SVB and Borrower have also entered into a certain Non-Recourse Receivables
Purchase Agreement dated December 31, 2003 (as amended and in effect, the “SVB
Purchase Facility”).

 

Whereas, SVB
has agreed to release its security interest in certain assets of Borrower in
accordance with the provisions hereof in order to permit Borrower to sell such
assets to Aspen Technology Receivables I LLC, free and clear of the security
interest granted to SVB under the SVB Loan Arrangement and SVB’s interest in
the accounts receivable purchased under the SVB Purchase Facility.

 

Now, therefore,
for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, SVB, the Borrower, and the Parties hereby agree as
follows:

 

1.                                       Partial
Release.  SVB hereby irrevocably
releases any lien, claim, encumbrance or security interest (including, without
limitation, its security interests under the SVB Loan Arrangement and its
interest in accounts receivable purchased under the SVB Purchase Facility) it
may have, solely in those certain accounts receivable, contracts (or portion
thereof), related security, and collections which are listed on Exhibit A hereto (the “SPV Receivables”)
and all proceeds thereof.

 

2.                                       Treatment
of Proceeds of the SPV Receivables.  SVB
specifically acknowledges and agrees that it shall retain no security interest or
ownership interest in or to the SPV Receivables or the proceeds thereof (the “Funds”).  In the event SVB receives, acquires or
obtains any such Funds directly from the Collection Account (as defined herein)
as payment of any of the Borrowers’ obligations under the SVB Loan Arrangement
or the SVB Purchase Facility, in connection with a disbursement request by the
Borrower to SVB directly from the Collection Account, or by set off or other
action taken by SVB against the Collection Account, SVB agrees to promptly turn
over any such Funds, or the

 

 

proceeds
thereof, to Guggenheim Corporate Funding, LLC (“Guggenheim”) or, at SVB’s
option, SVB may deposit such Funds into a court of competent jurisdiction in an
interpleader action.  In the event that
any Party receives, acquires or obtains any collateral or property of SVB, such
Party hereby agrees to promptly turn over such collateral, property, or the
proceeds thereof, to SVB, or, at Guggenheim’s option, Guggenheim may deposit
such Funds into a court of competent jurisdiction in an interpleader action.

 

3.                                       Amendment
to UCC Financing Statement.  Upon
receipt of this fully executed Agreement, SVB shall file the following UCC
financing statements on behalf of SVB, as Secured Party:

 

(a)                                  Amendment to
Financing Statement, releasing SVB’s security interest in the SPV Receivables
and the proceeds thereof, naming Aspen Technology, Inc., as Debtor, in the form
of Exhibit B hereto, to be
filed with the Delaware Secretary of State; and

 

(b)                                 Amendment to Financing
Statement, releasing SVB’s security interest in the SPV Receivables and the
proceeds thereof, naming Aspentech, Inc., as Debtor, in the form of Exhibit C hereto, to be filed with the
Texas Secretary of State.

 

SVB agrees to
deliver any such UCC financing statement partial releases reasonably requested
by Aspen or Guggenheim to effectuate the terms of paragraphs 1 and 3 hereof.

 

4.                                       Acknowledgement.  The Borrower maintains a lockbox with SVB identified
as follows: “Aspen Technology Inc. Box 83048, Woburn, MA
01813-3048” (the “Lockbox Account”).  The
Lockbox Account proceeds are currently transferred directly to a collection
account maintained at SVB in the name of Aspen Technology, Inc. identified as
Account No. 3300388202 (the “ Domestic Collection
Account”).  In addition, certain wires
are transferred to a separate collection account maintained at SVB in the name
of Aspen Technology, Inc. identified as Account No. 3300388217 (collectively
with the Domestic Collection Account, the “Collection Account”).  SVB acknowledges that the Borrower and
Guggenheim have advised SVB that the Borrower has granted Guggenheim a security
interest in the SPV Receivables and the proceeds thereof, and that the Lockbox
Account and the Collection Account may contain certain or all of the Funds,
which are the proceeds of the SPV Receivables.

 

5.                                       Entire
Agreement.  This Agreement (including
Exhibits hereto) sets forth the entire agreement between the Parties with
respect to the subject matter hereof, and supersedes all prior negotiations,
understandings and agreements between the Parties concerning such subject
matter.  No amendment or modification of
this Agreement shall be effective against a Party except by a writing signed by
authorized representative of such Party.

 

6.                                       No
Responsibility/Indemnification.  (a)  The Borrower and the Parties signing below
confirm and agree:

 

 

(i)                                     that SVB is not
undertaking to take any action with respect to the Lockbox Account, or
Collection Account, except as set forth in the agreements between SVB and the
Borrower pertaining thereto, and except as provided herein.

 

(ii)                                  that
SVB shall not have any duties or responsibilities except such duties and
responsibilities as are specifically set forth in this Agreement and no
covenants or obligations shall be implied in this Agreement against SVB.

 

(b)                                 The Borrower confirms
and agrees:

 

(i)                                     to indemnify SVB
and its directors, officers, employees and agents harmless against:  (i) all obligations, demands, claims, and
liabilities asserted by any party or person in connection with the transactions
contemplated by this Agreement; and (ii) all losses incurred, or paid by SVB
from, following, or consequential to transactions relating to this Agreement.

 

7.                                       Governing
Law.  This Agreement shall be governed
and interpreted in accordance with the laws of the Commonwealth of
Massachusetts, without regard to principles of conflict of laws, under the law
of the Commonwealth of Massachusetts.

 

[Remainder of Page Intentionally Left Blank]

 

 

In witness whereof,
the parties have executed this Agreement as of the date first written above.

 

	
  SILICON VALLEY BANK

  
	
   

  
	
  By:

  	
   

  	
  /s/ Michael Tramack

  	
   

  
	
   

  
	
  Name:

  	
   

  	
  Michael Tramack

  	
   

  
	
   

  
	
  Title:

  	
   

  	
  Relationship Manager

  	
   

  
	
   

  
	
  ASPEN TECHNOLOGY, INC.

  
	
   

  
	
  By:

  	
   

  	
  /s/ Charles F. Kane

  	
   

  
	
   

  
	
  Name:

  	
   

  	
  Charles F. Kane

  	
   

  
	
   

  
	
  Title:

  	
   

  	
  SVP & CFO

  	
   

  
	
   

  
	
  ASPENTECH, INC.

  
	
   

  
	
  By:

  	
   

  	
  /s/ Charles F. Kane

  	
   

  
	
   

  
	
  Name:

  	
   

  	
  Charles F. Kane

  	
   

  
	
   

  
	
  Title:

  	
   

  	
  CFO & Treasurer

  	
   

  
	
   

  
	
  AGREED AND ACKNOWLEDGED:

  
	
   

  
	
  GUGGENHEIM CORPORATE FUNDING, LLC

  
	
   

  
	
  By:

  	
   

  	
  /s/ Todd Boehly

  	
   

  
	
   

  
	
  Name:

  	
   

  	
  Todd Boehly

  	
   

  
	
   

  
	
  Title:

  	
   

  	
  Attorney-in-Fact

  	
   

  
										

 

 

Exhibit A

 

All of the Receivables, Collections and all proceeds thereof, in each
case, as more particularly described below.

 

“Collections” means, with respect to any Receivable, all funds
paid by or on behalf of the related obligor of such Receivable in payment of
any amounts owed (including, without limitation, purchase or sale prices,
principal, finance charges, interest and all other charges) in respect of such
Receivable.

 

“Receivable” means all indebtedness and other obligations
identified on Schedule I hereto (“Assets”), owed to Aspen
Technology, Inc. or any affiliate thereof, including, without limitation, any
indebtedness, obligation or interest relating to the Assets, and further
including, without limitation, all rights to payment of such indebtedness or
obligation arising under the related contract with respect to the Assets, and
the obligation to pay any finance charges with respect to the Assets.Exhibit 10.1

 

 

CREDIT AGREEMENT

 

 

Dated as of June 17, 2005

 

 

by and among

 

REALTY INCOME CORPORATION,

as Borrower,

 

THE FINANCIAL
INSTITUTIONS PARTY HERETO

AND THEIR ASSIGNEES UNDER SECTION 13.6.,

as Lenders,

 

THE BANK OF NEW YORK,

as Documentation Agent and

co-lead Arranger,

 

BANK OF AMERICA, N.A.,

as co-Syndication Agent,

 

WACHOVIA BANK, NATIONAL ASSOCIATION,

as co-Syndication Agent,

 

and

 

WELLS FARGO BANK, NATIONAL ASSOCIATION,

as Administrative Agent and

co-lead Arranger

 

 

 

TABLE OF CONTENTS

 

	
  Article I.
  Definitions

  	
  6

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 1.1.
  Definitions

  	
  6

  
	
   

  	
  Section 1.2.
  General; References to San Francisco Time

  	
  28

  
	
   

  	
   

  	
   

  
	
  Article II. Credit
  Facility

  	
  28

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 2.1.
  Revolving Loans

  	
  28

  
	
   

  	
  Section 2.2.
  Bid Rate Loans

  	
  30

  
	
   

  	
  Section 2.3.
  Swingline Loans

  	
  33

  
	
   

  	
  Section 2.4.
  Rates and Payment of Interest on Loans

  	
  35

  
	
   

  	
  Section 2.5.
  Number of Interest Periods

  	
  36

  
	
   

  	
  Section 2.6.
  Repayment of Loans

  	
  36

  
	
   

  	
  Section 2.7.
  Prepayments

  	
  36

  
	
   

  	
  Section 2.8. Late Charges

  	
  37

  
	
   

  	
  Section 2.9. Continuation

  	
  37

  
	
   

  	
  Section 2.10. Conversion

  	
  38

  
	
   

  	
  Section 2.11.
  Notes

  	
  38

  
	
   

  	
  Section 2.12. Voluntary
  Reductions of the Commitment

  	
  38

  
	
   

  	
  Section 2.13. Extension of
  Termination Date

  	
  39

  
	
   

  	
  Section 2.14. Amount Limitations

  	
  40

  
	
   

  	
  Section 2.15. Increase in
  Commitments

  	
  41

  
	
   

  	
   

  	
   

  
	
  Article III.
  Payments, Fees and Other General Provisions

  	
  41

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 3.1. Payments

  	
  41

  
	
   

  	
  Section 3.2.
  Pro Rata Treatment

  	
  42

  
	
   

  	
  Section 3.3. Sharing of
  Payments, Etc.

  	
  43

  
	
   

  	
  Section 3.4. Several Obligations

  	
  43

  
	
   

  	
  Section 3.5. Minimum Amounts

  	
  44

  
	
   

  	
  Section 3.6. Fees

  	
  44

  
	
   

  	
  Section 3.7. Computations

  	
  45

  
	
   

  	
  Section 3.8. Usury

  	
  45

  
	
   

  	
  Section 3.9. Statements of
  Account

  	
  45

  
	
   

  	
  Section 3.10. Defaulting
  Lenders

  	
  45

  
	
   

  	
  Section 3.11. Taxes

  	
  46

  
	
   

  	
   

  	
   

  
	
  Article IV.
  Unencumbered Pool Properties

  	
  48

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 4.1. Eligibility of
  Properties

  	
  48

  
	
   

  	
  Section 4.2. Termination of
  Designation as Unencumbered Pool Property

  	
  48

  
	
   

  	
   

  	
   

  
	
  Article V.
  Yield Protection, Etc.

  	
  49

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 5.1. Additional Costs;
  Capital Adequacy

  	
  49

  
	
   

  	
  Section 5.2. Suspension of LIBOR
  Loans

  	
  50

  
	
   

  	
  Section 5.3. Illegality

  	
  50

  
	
   

  	
  Section 5.4. Compensation

  	
  51

  
	
   

  	
  Section 5.5. Treatment of
  Affected Loans

  	
  51

  
	
   

  	
  Section 5.6. Change of Lending
  Office

  	
  52

  

 

 

	
   

  	
  Section 5.7. Affected Lenders

  	
  52

  
	
   

  	
  Section 5.8. Assumptions
  Concerning Funding of LIBOR Loans

  	
  53

  
	
   

  	
   

  	
   

  
	
  Article VI.
  Conditions Precedent

  	
  53

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 6.1. Initial Conditions
  Precedent

  	
  53

  
	
   

  	
  Section 6.2. Conditions
  Precedent to All Loans

  	
  55

  
	
   

  	
  Section 6.3.
  Conditions as Covenants

  	
  56

  
	
   

  	
   

  	
   

  
	
  Article VII.
  Representations and
  Warranties

  	
  56

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 7.1. Representations and
  Warranties

  	
  56

  
	
   

  	
  Section 7.2. Survival of
  Representations and Warranties, Etc.

  	
  62

  
	
   

  	
   

  	
   

  
	
  Article VIII.
  Affirmative Covenants

  	
  62

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 8.1. Preservation of
  Existence and Similar Matters

  	
  62

  
	
   

  	
  Section 8.2. Compliance with
  Applicable Law

  	
  62

  
	
   

  	
  Section 8.3. Maintenance of
  Property

  	
  63

  
	
   

  	
  Section 8.4. Conduct of Business

  	
  63

  
	
   

  	
  Section 8.5. Insurance

  	
  63

  
	
   

  	
  Section 8.6. Payment of Taxes
  and Claims

  	
  63

  
	
   

  	
  Section 8.7. Books and Records;
  Inspections

  	
  63

  
	
   

  	
  Section 8.8. Use of Proceeds

  	
  64

  
	
   

  	
  Section 8.9. Environmental
  Matters

  	
  64

  
	
   

  	
  Section 8.10. Further
  Assurances

  	
  64

  
	
   

  	
  Section 8.11. Material
  Contracts

  	
  65

  
	
   

  	
  Section 8.12. REIT Status

  	
  65

  
	
   

  	
  Section 8.13. Exchange Listing

  	
  65

  
	
   

  	
  Section 8.14. Guarantors

  	
  65

  
	
   

  	
  Section 8.15. Effective Date Matters

  	
  65

  
	
   

  	
   

  	
   

  
	
  Article IX.
  Information

  	
  66

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 9.1. Quarterly
  Financial Statements

  	
  66

  
	
   

  	
  Section 9.2. Year-End Statements

  	
  66

  
	
   

  	
  Section 9.3. Compliance
  Certificate

  	
  66

  
	
   

  	
  Section 9.4. Other Information

  	
  67

  
	
   

  	
   

  	
   

  
	
  Article X.
  Negative Covenants

  	
  69

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 10.1. Financial
  Covenants

  	
  69

  
	
   

  	
  Section 10.2. Negative Pledge

  	
  71

  
	
   

  	
  Section 10.3. Restrictions on
  Intercompany Transfers

  	
  72

  
	
   

  	
  Section 10.4. Merger,
  Consolidation, Sales of Assets and Other Arrangements

  	
  72

  
	
   

  	
  Section 10.5. Plans

  	
  73

  
	
   

  	
  Section 10.6. Fiscal Year

  	
  73

  
	
   

  	
  Section 10.7. Modifications of
  Organizational Documents

  	
  73

  
	
   

  	
  Section 10.8. Modifications to
  Material Contracts

  	
  73

  
	
   

  	
  Section 10.9. Transactions with
  Affiliates

  	
  74

  
	
   

  	
  Section 10.10. Limitations on
  Non-Guarantor Subsidiaries

  	
  74

  

 

3

 

	
  Article XI.
  Default

  	
  74

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 11.1. Events of Default

  	
  74

  
	
   

  	
  Section 11.2. Remedies Upon
  Event of Default

  	
  78

  
	
   

  	
  Section 11.3. Remedies Upon
  Default

  	
  79

  
	
   

  	
  Section 11.4. Marshaling;
  Payments Set Aside

  	
  79

  
	
   

  	
  Section 11.5. Allocation of
  Proceeds

  	
  80

  
	
   

  	
  Section 11.6. Performance by
  Agent

  	
  80

  
	
   

  	
  Section 11.7. Rights Cumulative

  	
  80

  
	
   

  	
   

  	
   

  
	
  Article XII.
  The Agent

  	
  81

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 12.1. Appointment and
  Authorization

  	
  81

  
	
   

  	
  Section 12.2.
  Agent’s Reliance, Etc.

  	
  82

  
	
   

  	
  Section 12.3.
  Notice of Defaults

  	
  82

  
	
   

  	
  Section 12.4. Wells Fargo as
  Lender

  	
  83

  
	
   

  	
  Section 12.5. Approvals of
  Lenders

  	
  83

  
	
   

  	
  Section 12.6. Lender Credit
  Decision, Etc.

  	
  83

  
	
   

  	
  Section 12.7. Indemnification of
  Agent

  	
  84

  
	
   

  	
  Section 12.8. Successor Agent

  	
  85

  
	
   

  	
  Section 12.9. Titled Agents

  	
  85

  
	
   

  	
   

  	
   

  
	
  Article XIII.
  Miscellaneous

  	
  86

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 13.1. Notices

  	
  86

  
	
   

  	
  Section 13.2. Expenses

  	
  87

  
	
   

  	
  Section 13.3. Stamp, Intangible
  and Recording Taxes

  	
  88

  
	
   

  	
  Section 13.4. Setoff

  	
  88

  
	
   

  	
  Section 13.5. Litigation;
  Jurisdiction; Other Matters; Waivers

  	
  88

  
	
   

  	
  Section 13.6. Successors and
  Assigns

  	
  89

  
	
   

  	
  Section 13.7. Amendments and
  Waivers

  	
  92

  
	
   

  	
  Section 13.8. Nonliability of
  Agent and Lenders

  	
  94

  
	
   

  	
  Section 13.9. Confidentiality

  	
  94

  
	
   

  	
  Section 13.10. Indemnification

  	
  94

  
	
   

  	
  Section 13.11. Termination;
  Survival

  	
  96

  
	
   

  	
  Section 13.12. Severability of
  Provisions

  	
  97

  
	
   

  	
  Section 13.13. GOVERNING LAW

  	
  97

  
	
   

  	
  Section 13.14. USA Patriot Act
  Notice; Compliance

  	
  97

  
	
   

  	
  Section 13.15. Counterparts

  	
  97

  
	
   

  	
  Section 13.16. Obligations with
  Respect to Loan Parties

  	
  97

  
	
   

  	
  Section 13.17. Independence of
  Covenants

  	
  97

  
	
   

  	
  Section 13.18. Limitation of
  Liability

  	
  98

  
	
   

  	
  Section 13.19. Entire Agreement

  	
  98

  
	
   

  	
  Section 13.20. Construction

  	
  98

  
	
   

  	
  Section 13.21. No Novation

  	
  98

  

 

4

 

	
  SCHEDULE 1.1.

  	
  List of Loan Parties

  
	
  SCHEDULE 4.1.

  	
  Initial Unencumbered Pool Properties

  
	
  SCHEDULE 7.1.(b)

  	
  Ownership Structure

  
	
  SCHEDULE 7.1.(f)

  	
  Properties

  
	
  SCHEDULE 7.1.(g)

  	
  Indebtedness and Guaranties; Total Liabilities

  
	
  SCHEDULE 7.1.(h)

  	
  Material Contracts

  
	
  SCHEDULE 7.1.(i)

  	
  Litigation

  
	
  SCHEDULE 7.1.(o)

  	
  Environmental Matters

  
	
  SCHEDULE 7.1.(r)

  	
  Affiliate Transactions

  

 

	
  EXHIBIT A

  	
  Form of Assignment and Assumption

  
	
  EXHIBIT B

  	
  Form of Notice of Borrowing

  
	
  EXHIBIT C

  	
  Form of Notice of Continuation

  
	
  EXHIBIT D

  	
  Form of Notice of Conversion

  
	
  EXHIBIT E

  	
  Form of Revolving Note

  
	
  EXHIBIT F

  	
  Form of Notice of Swingline Borrowing

  
	
  EXHIBIT G

  	
  Form of Swingline Note

  
	
  EXHIBIT H

  	
  Form of Bid Rate Quote Request

  
	
  EXHIBIT I

  	
  Form of Bid Rate Quote

  
	
  EXHIBIT J

  	
  Form of Bid Rate Quote Acceptance

  
	
  EXHIBIT K

  	
  Form of Bid Rate Note

  
	
  EXHIBIT L

  	
  Form of Designation Agreement

  
	
  EXHIBIT M

  	
  Form of Extension Request

  
	
  EXHIBIT N-1

  	
  Form of Opinion of Latham & Watkins LLP

  
	
  EXHIBIT N-2

  	
  Form of Opinion of Venable LLP

  
	
  EXHIBIT N-3

  	
  Form of Opinion of Borrower’s General Counsel

  
	
  EXHIBIT O

  	
  Form of Guaranty

  
	
  EXHIBIT P

  	
  Form of Compliance Certificate

  
	
  EXHIBIT Q

  	
  Form of Unencumbered Pool Certificate

  
	
  EXHIBIT R

  	
  Form of Closing Certificate

  

 

5

 

CREDIT AGREEMENT

 

THIS CREDIT AGREEMENT dated as of June 17, 2005 by and among
REALTY INCOME CORPORATION, a corporation formed under the laws of the State of
Maryland (the “Borrower”), each of the financial institutions initially a
signatory hereto together with their assignees under Section 13.6. (the “Lenders”),
THE BANK OF NEW YORK, as Documentation Agent and co-lead Arranger (the “Documentation
Agent”), BANK OF AMERICA, N.A., as co-Syndication Agent, WACHOVIA BANK,
NATIONAL ASSOCIATION, as co-Syndication Agent (each a “Syndication Agent”), and
WELLS FARGO BANK, NATIONAL ASSOCIATION (“Wells Fargo”) as contractual
representative of the Lenders to the extent and in the manner provided in
Article XII. (in such capacity, the “Agent”) and co-lead Arranger.

 

WHEREAS, the Borrower, Agent and the Lenders entered into that certain
Credit Agreement dated as of October 28, 2002 (as amended and as in effect
immediately prior to the date hereof, the “Existing Credit Agreement”); and

 

WHEREAS, the Borrower, the Agent and the Lenders desire to amend and
restate the Existing Credit Agreement, among other things, to make available to
the Borrower a revolving credit facility in the amount of $300,000,000,
including a $50,000,000 swingline subfacility, all pursuant to the terms
hereof.

 

NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties hereto, the parties
hereto agree the Existing Credit Agreement is amended and restated in its
entirety as follows:

 

ARTICLE I. DEFINITIONS

 

Section 1.1.  Definitions.

 

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

 

“Absolute Rate” has the
meaning given that term in Section 2.2.(c)(ii)(C).

 

“Absolute Rate Auction”
means a solicitation of Bid Rate Quotes setting forth Absolute Rates pursuant
to Section 2.2.

 

“Absolute Rate Loan” means
a Bid Rate Loan, the interest rate on which is determined on the basis of an
Absolute Rate pursuant to an Absolute Rate Auction.

 

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

 

“Agent” has the meaning
set forth in the introductory paragraph hereof and shall include any successor
Agent appointed pursuant to Section 12.8.

 

6

 

“Additional Costs” has the meaning given
that term in Section 5.1.

 

“Affiliate” means any Person (other than
the Agent or any Lender): (a) directly or indirectly controlling,
controlled by, or under common control with, the Borrower; (b) directly or
indirectly owning or holding ten percent (10.0%) or more of any equity interest
in the Borrower; or (c) ten percent (10.0%) or more of whose voting stock
or other equity interest is directly or indirectly owned or held by the
Borrower.  For purposes of this
definition, “control” (including with correlative meanings, the terms “controlling”,
“controlled by” and “under common control with”) means the possession directly
or indirectly of the power to direct or cause the direction of the management
and policies of a Person, whether through the ownership of voting securities or
by contract or otherwise.  In no event
shall the Agent or any Lender be deemed to be an Affiliate of the Borrower.

 

“Agent” means Wells Fargo Bank, National
Association, as contractual representative for the Lenders under the terms of
this Agreement, and any of its successors in such capacity.

 

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

 

“Annualized Base Rents”
means, for any tenant in a Property owned by the Borrower, a Loan Party or any
other Subsidiary, an amount equal to the GAAP revenue received from such tenant
during the quarter most recently ended multiplied by 4.

 

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

 

	
  Level

  	
   

  	
  Facility Fee

  	
   

  
	
  1

  	
   

  	
  .15

  	
  %

  
	
  2

  	
   

  	
  .15

  	
  %

  
	
  3

  	
   

  	
  .15

  	
  %

  
	
  4

  	
   

  	
  .20

  	
  %

  
	
  5

  	
   

  	
  .25

  	
  %

  

Any change in the
applicable Level at which the Applicable Margin is determined shall result in a
corresponding and simultaneous change in the Applicable Facility Fee.

 

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

 

“Applicable Margin” means the percentage
rate set forth below corresponding to the range into which the Borrower’s
Credit Rating then falls.  Any change in
the Borrower’s Credit Rating which would cause it to move to a different range
in the table shall be effective as of the first day of the month following the
date on which such change occurs.  If the
Rating Agencies assign Credit Ratings which correspond to different Levels in
the above table resulting in different Applicable Margin determinations, the
Applicable Margin will be determined based on

 

7

 

the Level corresponding to the highest Credit Rating assigned by at
least two Rating Agencies; provided, however, that if no two Rating Agencies
have assigned the same Credit Rating with respect to the Borrower, then the
Applicable Margin will be determined based on the Level corresponding to the
middle of the three published Credit Ratings.

 

	
  Level

  	
   

  	
  Borrower’s
  Credit Rating

  (S&P/Moody’s/Fitch or equivalent)

  	
   

  	
  Applicable

  Margin for

  LIBOR Loans

  	
   

  
	
  1

  	
   

  	
  A-/A3 or equivalent

  	
   

  	
  .55

  	
  %

  
	
  2

  	
   

  	
  BBB+/Baa1 or equivalent

  	
   

  	
  .60

  	
  %

  
	
  3

  	
   

  	
  BBB/Baa2 or equivalent

  	
   

  	
  .65

  	
  %

  
	
  4

  	
   

  	
  BBB-/Baa3 or equivalent

  	
   

  	
  .80

  	
  %

  
	
  5

  	
   

  	
  Lower than BBB-/Baa3 or equivalent

  	
   

  	
  1.125

  	
  %

  

 

“Assignee” has the meaning given that
term in Section 13.6.(c).

 

“Assignment and Assumption”
means an Assignment and Assumption Agreement among a Lender, an Assignee and
the Agent, substantially in the form of Exhibit A.

 

“Base Rate” means the greater of
(a) the rate of interest per annum publicly announced from time to time by
Wells Fargo Bank, National Association at its principal office in San
Francisco, California as its “prime rate” (which rate of interest may not be
the lowest rate charged by Wells Fargo Bank, National Association or any of the
other Lenders on similar loans) and (b) the Federal Funds Rate plus
one-half of one percent (0.5%).  Each
change in the Base Rate shall become effective without prior notice to the
Borrower or the Lenders automatically as of the opening of business on the date
of such change in the Base Rate.

 

“Base Rate Loan” means a Revolving Loan
bearing interest at a rate based on the Base Rate.

 

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

 

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

 

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

 

“Bid Rate Note” means a
promissory note of the Borrower substantially in the form of Exhibit K,
payable to the order of a Lender in a principal amount equal to the amount of
such Lender’s Commitment as originally in effect and otherwise duly completed.

 

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

 

8

 

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

 

“Borrower” has the meaning set forth in
the introductory paragraph hereof and shall include the Borrower’s successors
and permitted assigns.

 

“Borrowing Base” means the aggregate
Unencumbered Pool Values of all Unencumbered Pool Properties divided by 1.75.

 

“Business Day” means (a) any day
other than a Saturday, Sunday or other day on which banks in San Francisco,
California are authorized or required to close and (b) with reference to a
LIBOR Loan, any such day that is also a day on which dealings in Dollar deposits
are carried out in the London interbank market.

 

“Capitalized EBITDA”
means, with respect to a Person and as of a given date, (a) such Person’s
EBITDA for the fiscal quarter most recently ended multiplied by
(b) 4 and divided by (c) 9.0%. 
In determining Capitalized EBITDA with respect to a Property owned by a
Subsidiary that is not a Wholly Owned Subsidiary, only the Borrower’s Ownership
Share of the EBITDA of such Property shall be used when determining Capitalized
EBITDA.

 

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

 

“Closing Date” means the later of
(a) the Agreement Date and (b) the date on which all of the
conditions precedent set forth in Section 6.1. shall have been fulfilled
or waived in writing in accordance with the provisions of Section 13.7.

 

“Commitment” means, as to
each Lender, such Lender’s obligation to make Revolving Loans pursuant to
Section 2.1. and to participate in Swingline Loans pursuant to
Section 2.3., in an amount up to, but not exceeding the amount set forth
for such Lender on its signature page hereto as such Lender’s “Commitment
Amount” or as set forth in the applicable Assignment and Acceptance Agreement,
as the same may be reduced from time to time pursuant to Section 2.12. or
otherwise pursuant to the terms of this Agreement or as appropriate to reflect
any assignments to or by such Lender effected in accordance with
Section 13.6.

 

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

 

“Compliance Certificate” has the meaning
given that term in Section 9.3.

 

9

 

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

 

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

 

“Credit Event” means any of the
following: (a) the making (or deemed making) of any Loan, (b) the
Conversion of a Revolving Loan and (c) the Continuation of a LIBOR Loan.

 

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

 

“Default” means any of the events
specified in Section 11.1., whether or not there has been satisfied any
requirement for the giving of notice, the lapse of time, or both.

 

“Defaulting Lender” has the meaning set
forth in Section 3.10.

 

“Derivatives Contract” means 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.  Not in limitation
of the foregoing, the term “Derivatives Contract” includes 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, including any such obligations or liabilities under any such master
agreement.

 

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

 

10

 

 

“Designated Lender” means
a special purpose corporation which is an affiliate of, or sponsored by, a
Lender, that is engaged in making, purchasing or otherwise investing in commercial
loans in the ordinary course of its business and that issues (or the parent of
which issues) commercial paper rated at least P-1 (or the then equivalent
grade) by Moody’s or A-1 (or the then equivalent grade) by S&P that, in
either case, (a) is organized under the laws of the United States of
America or any state thereof, (b) shall have become a party to this
Agreement pursuant to Section 13.6.(d) and (c) is not otherwise
a Lender.

 

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

 

“Designating Lender” has
the meaning given that term in Section 13.6.(d).

 

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

 

“Development Property” means a Property
currently under development (i) upon which a certificate of occupancy has
not been obtained in accordance with Applicable Law and local building and
zoning ordinances and (ii) on which the improvements (other than tenant
improvements on unoccupied space) related to the development have not been
substantially completed. The term “Development Property” shall include real
property of the type described in the immediately preceding sentence to be (but
not yet) acquired by the Borrower, any Subsidiary or any Unconsolidated
Affiliate upon completion of construction pursuant to a contract in which the
seller of such real property is required to develop or renovate prior to, and
as a condition precedent to, such acquisition.

 

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

 

“EBITDA” means, with respect to any
Person for any period and without duplication, net earnings (loss) of such
Person for such period (excluding equity in net earnings or net loss of
Unconsolidated Affiliates) including (if deducted in determining net earnings
for such period) or excluding (if added in determining net earnings (loss) for
such period), as applicable, the following amounts (but only to the extent
included in determining net earnings (loss) for such period):
(a) depreciation and amortization expense and other non-cash charges of
such Person for such period; (b) interest expense of such Person for such
period; (c) income tax expense of such Person in respect of such period;
(d) extraordinary and nonrecurring gains and losses of such Person for such
period, including without limitation, gains and losses from the sale of assets
(it being agreed that the sales of assets by Crest Net Lease, Inc. are not
extraordinary or nonrecurring), write-offs and forgiveness of debt; and
(e) the portion of EBITDA allocable to interests in Unconsolidated
Affiliates, except to the extent that cash dividends or distributions are
actually received by such Person.  For
purposes of this definition, net earnings (loss) shall be determined before minority
interests and distributions to holders of Preferred Stock.

 

“Effective Date” means October 28,
2005.

 

“Eligible Assignee” means
any Person that is:  (a) an existing
Lender; (b) a commercial bank, trust company, savings and loan
association, savings bank, insurance company, investment bank or pension fund
organized under the laws of the United States of America, any state thereof

 

11

 

or the District of Columbia, and having total assets in excess of
$5,000,000,000; or (c) a commercial bank organized under the laws of any
other country which is a member of the Organisation for Economic Co-operation
and Development, or a political subdivision of any such country, and having
total assets in excess of $10,000,000,000, provided that such bank is acting
through a branch or agency located in the United States of America.  If such entity is not currently a Lender,
such entity’s (or in the case of a bank which is a subsidiary, such bank’s
parent’s) senior unsecured long term indebtedness must be rated BBB or higher
by S&P, Baa2 or higher by Moody’s or the equivalent or higher of either
such rating by another rating agency acceptable to the Agent.  Notwithstanding the foregoing, if a Default
or Event of Default exists an Eligible Assignee may also include any Person
approved by the Agent.

 

“Eligible Property” means a Property
which satisfies all of the following requirements as reasonably confirmed by
the Agent: (a) such Property is owned in fee simple by the Borrower or a
Wholly Owned Subsidiary; (b) such Property is a completed retail property
leased to third party tenants on a net lease basis; (c) such Property is
located in a State of the United States of America or in the District of
Columbia; (d) regardless of whether such Property is owned by the Borrower
or a Subsidiary, the Borrower has the right directly, or indirectly through a
Subsidiary, to take the following actions without the need to obtain the
consent of any Person: (i) to create Liens on such Property as security
for Indebtedness of the Borrower or such Subsidiary, as applicable, and
(ii) to sell, transfer or otherwise dispose of such Property;
(e) neither such Property, nor if such Property is owned by a Subsidiary,
any of the Borrower’s direct or indirect ownership interest in such Subsidiary
is subject to (i) any Lien other than Permitted Liens or (ii) any
Negative Pledge; (f) the Occupancy Rate of such Property equals or exceeds
85%; (g) such Property is not a Development Property; (h) such
Property is not subject to a ground lease; and (i) such Property is free
of all structural defects, title defects, environmental conditions or other
adverse matters except for defects, conditions or matters individually or
collectively which are not material to the profitable operation of such Property.  Notwithstanding the foregoing, (i) the
Silverton Business Center shall be deemed to be an Eligible Property even if it
does not satisfy the requirements set forth in clauses (b) (as it relates
to such Property being leased on a net leased basis) and (f) above, so
long as the Occupancy Rate for the Silverton Business Center equals or exceeds
80% and the Silverton Business Center satisfies all other remaining
requirements of this definition and (ii) any other Property approved by
the Requisite Lenders pursuant to Section 4.1.(c) shall be deemed to
be an Eligible Property even if such Property does not satisfy all of the
requirements herein, so long as such Property continues to satisfy all those
remaining requirements in this definition that were satisfied by such Property
at the time of such Requisite Lender approval.

 

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

 

12

 

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

 

“Equity Issuance” means any issuance or
sale by a Person of any Equity Interest.

 

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

 

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

 

“Event of Default” means any of the
events specified in Section 11.1., provided that any requirement for
notice or lapse of time or any other condition has been satisfied.

 

“Existing Credit Agreement” has the
meaning given that term in the first “WHEREAS” clause of this Agreement.

 

“Extension Request” has
the meaning given that term in Section 2.13.(a).

 

“Fair Market Value”
means, with respect to any asset, the price that could be negotiated in an arm’s-length
free market transaction, for cash, between a willing seller and a willing
buyer, neither of which is under pressure or compulsion to complete the
transaction.  Except as otherwise
provided herein, Fair Market Value shall be determined by the Board of
Directors of the Borrower (or an authorized committee thereof) acting in good
faith conclusively evidenced by a board resolution thereof delivered to the
Agent or, with respect to any asset valued at up to $1,000,000, such
determination may be made by the chief financial officer of the Borrower
evidenced by an officer’s certificate delivered to the Agent.

 

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

 

13

 

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

 

“Fitch” means Fitch Rating
Group.

 

“Fixed Charges” means, with respect to a
Person and for a given period, the sum of (a) the Interest Expense of such
Person for such period, plus (b) the aggregate of all scheduled
principal payments on Indebtedness made by such Person during such period (excluding
balloon, bullet or similar payments of principal due upon the stated maturity
of Indebtedness), plus (c) the aggregate of all dividends paid or
accrued by such Person on any Preferred Stock during such period, plus
(d) the Reserve for Replacements for such Person’s Properties.

 

“Funds From Operations” means net income available to common
stock holders (computed in accordance with GAAP), plus depreciation and
amortization, but excluding gains on the sale of investment properties from “continuing
operations” and “discontinued operations” (as indicated on the consolidated
statements of income (and accompanying notes) of the Borrower)(it being agreed
that gain or losses on sales by Crest Net Lease, Inc. are not
extraordinary or non-recurring and should be included in Funds from Operations)
and after adjustments for unconsolidated partnerships and joint ventures.
Adjustments for unconsolidated partnerships and joint ventures will be
calculated to reflect funds from operations on the same basis. Funds From
Operations shall be calculated consistent with the National Association of Real
Estate Investments Trusts, Inc. (“NAREIT”) as of the Agreement Date, but
without giving effect to any supplements, amendments or other modifications
promulgated after the Agreement Date.

 

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

 

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

 

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

 

14

 

“Gross Asset Value” means, at a given time, the sum (without
duplication) of (a) Capitalized EBITDA of the Borrower and its
Subsidiaries on a consolidated basis at such time, plus (b) all
cash, cash equivalents (excluding tenant deposits and other cash and cash
equivalents the disposition of which is restricted) and marketable securities
of the Borrower and its Subsidiaries at such time, plus (c) the
current book value of all real property of the Borrower and its Subsidiaries
upon which construction is then in progress and all land held for development, plus
(d) the Borrower’s respective Ownership Shares of the current book values
of all real property of each Unconsolidated Affiliate upon which construction
is in progress, plus (e) the purchase price paid by the Borrower or
any Subsidiary (less any amounts paid to the Borrower or such Subsidiary as a
purchase price adjustment, held in escrow, retained as a contingency reserve,
or in connection with other similar arrangements) for any Property (other than
a Development Property) acquired by the Borrower or such Subsidiary during the
immediately preceding fiscal quarter of the Borrower plus (f) the
contractual purchase price of Properties of the Borrower and its Subsidiaries
subject to purchase obligations, repurchase obligations, forward commitments and
unfunded obligations to the extent such obligations and commitments are
included in determinations of Total Liabilities.  No more than 5% of the Gross Asset Value may
be attributable to the current book value of land held for development.

 

“Guarantor” means any Person that is
party to the Guaranty as a “Guarantor” and shall in any event include Realty
Income Texas Properties, L.P., Realty Income Texas Properties, Inc. and
each Wholly Owned Subsidiary of the Borrower other than (i) Crest Net
Lease, Inc. and (ii) no more than two Taxable REIT Subsidiaries,
other than Crest Net Lease, Inc.

 

“Guaranty”, “Guaranteed”
or to “Guarantee” as applied to any obligation
means and includes:  (a) a guaranty
(other than by endorsement of negotiable instruments for collection in the
ordinary course of business), directly or indirectly, in any manner, of any
part or all of such obligation, or (b) an agreement, direct or indirect,
contingent or otherwise, and whether or not constituting a guaranty, the
practical effect of which is to assure the payment or performance (or payment
of damages in the event of nonperformance) of any part or all of such
obligation whether by: (i) the purchase of securities or obligations,
(ii) the purchase, sale or lease (as lessee or lessor) of property or the
purchase or sale of services primarily for the purpose of enabling the obligor
with respect to such obligation to make any payment or performance (or payment
of damages in the event of nonperformance) of or on account of any part or all
of such obligation, or to assure the owner of such obligation against loss,
(iii) the supplying of funds to or in any other manner investing in the
obligor with respect to such obligation, (iv) repayment of amounts drawn
down by beneficiaries of letters of credit, or (v) the supplying of funds
to or investing in a Person on account of all or any part of such Person’s
obligation under a Guaranty of any obligation or indemnifying or holding
harmless, in any way, such Person against any part or all of such obligation.  As the context requires, “Guaranty” shall
also mean the guaranty executed and delivered pursuant to Section 6.1. and
substantially in the form of Exhibit O.

 

“Hazardous Materials” means all or any
of the following: (a) substances that are defined or listed in, or
otherwise classified pursuant to, any applicable Environmental Laws as “hazardous
substances”, “hazardous materials”, “hazardous wastes”, “toxic substances” or
any other formulation intended to define, list or classify substances by reason
of deleterious properties such as ignitability, corrosivity, reactivity,
carcinogenicity, reproductive toxicity,

 

15

 

“TCLP” toxicity, or “EP toxicity”; (b) oil, petroleum or petroleum
derived substances, natural gas, natural gas liquids or synthetic gas and
drilling fluids, produced waters and other wastes associated with the
exploration, development or production of crude oil, natural gas or geothermal
resources; (c) any flammable substances or explosives or any radioactive
materials; (d) asbestos in any form; and (e) electrical equipment
which contains any oil or dielectric fluid containing levels of polychlorinated
biphenyls in excess of fifty parts per million.

 

“Indebtedness” means, with respect to a
Person, at the time of computation thereof, all of the following (without
duplication): (a) all obligations of such Person in respect of money
borrowed; (b) all obligations of such Person (other than trade debt
incurred in the ordinary course of business), whether or not for money borrowed
(i) represented by notes payable, or drafts accepted, in each case
representing extensions of credit, (ii) evidenced by bonds, debentures,
notes or similar instruments, or (iii) constituting purchase money indebtedness,
conditional sales contracts, title retention debt instruments or other similar
instruments, upon which interest charges are customarily paid or that are
issued or assumed as full or partial payment for property; (c) Capitalized
Lease Obligations of such Person; (d) all reimbursement obligations of
such Person under or in respect of any letters of credit or acceptances
(whether or not the same have been presented for payment); (e) all Off
Balance Sheet Liabilities of such Person; (f) net obligations under any
Derivative Contract in an amount equal to the Derivatives Termination Value
thereof; and (g) all Indebtedness of other Persons which (i) such
Person has Guaranteed or is otherwise recourse to such Person or (ii) is
secured by a Lien on any property of such Person.

 

“Intellectual Property” has the meaning
given that term in Section 7.1.(s).

 

“Interest Expense” means, with respect
to a Person and for any period, (a) all paid, accrued or capitalized
interest expense (including, without limitation, capitalized interest expense
(other than capitalized interest funded from a construction loan interest
reserve account held by another lender and not included in the calculation of
cash for balance sheet reporting purposes) and interest expense attributable to
Capitalized Lease Obligations) of such Person and in any event shall include
all letter of credit fees and all interest expense with respect to any
Indebtedness in respect of which such Person is wholly or partially liable
whether pursuant to any repayment, interest carry, performance Guarantee or
otherwise, plus (b) to the extent not already included in the
foregoing clause (a) such Person’s Ownership Share of all paid,
accrued or capitalized interest expense for such period of Unconsolidated
Affiliates of such Person.

 

“Interest Period” means,

 

(a)           with respect to any
LIBOR Loan that is a Revolving Loan, each period commencing on the date such
LIBOR Loan is made or the last day of the next preceding Interest Period for
such Loan and ending on the numerically corresponding day in the first, second,
third or sixth calendar month thereafter, as the Borrower may select in a
Notice of Borrowing, Notice of Continuation or Notice of Conversion, as the
case may be, except that each Interest Period that commences on the last Business
Day of a calendar month (or on any day for which there is no numerically
corresponding day in the appropriate subsequent calendar month) shall end on
the last Business Day of the appropriate subsequent calendar month.  In addition to such periods, the Borrower may
request Interest Periods having durations of up to 10 Business Days for LIBOR
Loans which are Swingline Loans;

 

16

 

(a)           with respect to any
LIBOR Loan that is a Swingline Loan, each period commencing on the date such
LIBOR Loan is made and ending on the date up to 10
Business Days thereafter, as the Borrower may select in a Notice of Swingline
Borrowing; and

 

(b)           with respect to any
Absolute Rate Loan or Libor Margin Loan, the period commencing on the date such
Loan is made and ending on the numerically corresponding day in the first,
second, or third calendar month thereafter, as the Borrower may select as
provided in Section 2.2.(b), except that each Interest Period that
commences on the last Business Day of a calendar month (or on any day for which
there is no numerically corresponding day in the appropriate subsequent
calendar month) shall end on the last Business Day of the appropriate
subsequent calendar month.

 

Notwithstanding the foregoing: (a) if any Interest Period would
otherwise end after the Termination Date or Swingline Termination Date, as
applicable, such Interest Period shall end on the Termination Date or Swingline
Termination Date, as applicable; (b) each Interest Period that would
otherwise end on a day which is not a Business Day shall end on the next
succeeding Business Day (or, if such next succeeding Business Day falls in the
next succeeding calendar month, on the next preceding Business Day); and
(c) notwithstanding the immediately preceding clauses (a) and (b),
other than with respect to Swingline Loans, no Interest Period shall have a
duration of less than one month and, if the Interest Period for any Loan would
otherwise be a shorter period, such Loan shall not be available hereunder for
such period.

 

“Internal Revenue Code” means the
Internal Revenue Code of 1986, as amended.

 

“Investment” means, with respect to any
Person, any acquisition or investment (whether or not of a controlling
interest) by such Person, whether by means of (a) the purchase or other
acquisition of any Equity Interest in another Person, (b) a loan, advance
or extension of credit to, capital contribution to, Guaranty of Indebtedness
of, or purchase or other acquisition of any Indebtedness of, another Person,
including any partnership or joint venture interest in such other Person, or
(c) the purchase or other acquisition (in one transaction or a series of
transactions) of assets of another Person that constitute the business or a
division or operating unit of another Person. 
Any commitment or option to make an Investment in any other Person shall
constitute an Investment.  Except as
expressly provided otherwise, for purposes of determining compliance with any
covenant contained in a Loan Document, the amount of any Investment shall be
the amount actually invested, without adjustment for subsequent increases or
decreases in the value of such Investment.

 

“Investment Grade Rating” means a Credit
Rating of BBB- or higher by S&P or Fitch, Baa3 or higher by Moody’s, or the
equivalent or higher of either such rating by another Rating Agency.

 

“Lender” means each
financial institution from time to time party hereto as a “Lender” or a “Designated
Lender,” together with its respective successors and permitted assigns, and, as

 

17

 

the context requires, includes the Swingline Lender; provided, however,
that the term “Lender” shall exclude each Designated Lender when used in
reference to any Loan other than a Bid Rate Loan, the Commitments or terms
relating to any Loan other than a Bid Rate Loan and the Commitments and shall
further exclude each Designated Lender for all other purposes hereunder except
that any Designated Lender which funds a Bid Rate Loan shall, subject to
Section 13.6.(d), have the rights (including the rights given to a Lender
contained in Sections 13.2. and 13.10.) and obligations of a Lender
associated with holding such Bid Rate Loan.

 

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

 

“LIBOR” means, for any LIBOR Loan or
LIBOR Margin Loan for any Interest Period therefor, the average rate of
interest per annum at which deposits in immediately available funds in Dollars
are offered to the Lender then acting as Agent (at approximately 9:00 a.m.
San Francisco time, two Business Days prior to the first day of such Interest
Period) by first class banks in the interbank Eurodollar market where the
Eurodollar operations of the Lender then acting as Agent are customarily
conducted, for delivery on the first day of such Interest Period, such deposits
being for a period of time equal or comparable to such Interest Period and in
an amount equal to or comparable to the principal amount of the LIBOR Loan to
which such Interest Period relates.  Each
determination of LIBOR by the Lender then acting as Agent shall, in absence of
demonstrable error, be conclusive and binding.

 

“LIBOR Auction” means a
solicitation of Bid Rate Quotes setting forth LIBOR Margin Loans based on LIBOR
pursuant to Section 2.2.

 

“LIBOR Loan” means a Revolving Loan or
Swingline Loan bearing interest at a rate based on LIBOR.

 

“LIBOR Margin Loan” means
a Bid Rate Loan the interest rate on which is determined on the basis of LIBOR
pursuant to a LIBOR Auction.

 

“Lien” as applied to the property of any
Person means:  (a) any security
interest, encumbrance, mortgage, deed to secure debt, deed of trust, pledge,
lien, charge or lease constituting a Capitalized Lease Obligation, conditional
sale or other title retention agreement, or other security title or encumbrance
of any kind in respect of any property of such Person, or upon the income or
profits therefrom; (b) any arrangement, express or implied, under which
any property of such Person is transferred, sequestered or otherwise identified
for the purpose of subjecting the same to the payment of Indebtedness or
performance of any other obligation in priority to the payment of the general,
unsecured creditors of such Person; (c) the filing of any financing
statement under the UCC or its equivalent in any jurisdiction; and (d) any
agreement by such Person to grant, give or otherwise convey any of the
foregoing.

 

“Loan” means a Revolving Loan, a Bid
Rate Loan or a Swingline Loan.

 

18

 

“Loan Document” means this Agreement, each
Note, and each other document or instrument now or hereafter executed and
delivered by a Loan Party in connection with, pursuant to or relating to this
Agreement.

 

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

 

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

 

“Material Contract” means any contract
or other arrangement (other than Loan Documents), whether written or oral, to
which the Borrower, any Subsidiary or any other Loan Party is a party as to which
the breach, nonperformance, cancellation or failure to renew by any party
thereto could reasonably be expected to have a Material Adverse Effect.

 

“Material Plan” means at any time a Plan
or Plans having aggregate Unfunded Liabilities in excess of $5,000,000.

 

“Maximum Loan Availability”
means, at any time, the lesser of (i) an amount equal to the positive
difference, if any, of (x) the Borrowing Base minus (y) all
Unsecured Liabilities (other than the Loans), of the Borrower and its
Subsidiaries on a consolidated basis and (ii) the aggregate amount of the
Commitments at such time.

 

“Moody’s” means Moody’s Investors
Service, Inc.

 

“Mortgage” means a
mortgage, deed of trust, deed to secure debt or similar security instrument
made or to be made by a Person owning an interest in real estate granting a
Lien on such interest in real estate as security for the payment of
Indebtedness.

 

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

 

“Negative Pledge” means, with respect to
a given asset, any provision of a document, instrument or agreement (other than
any Loan Document) which prohibits or purports to prohibit the creation of any
Lien on such asset as security for Indebtedness of the Person owning such asset
or any other Person.

 

19

 

“Net Operating Income” means, for any
Property and for a given period, the sum (without duplication) of
(a) rents and other revenues received in the ordinary course from such
Property (excluding pre-paid rents and revenues and security deposits except to
the extent applied in satisfaction of tenants’ obligations for rent) minus
(b) all expenses paid or accrued by the Borrower and its Subsidiaries and
related to the ownership, operation or maintenance of such Property (other than
those expenses normally covered by a management fee), including but not limited
to, taxes, assessments and the like, insurance, utilities, payroll costs,
maintenance, repair and landscaping expenses, marketing expenses, and general
and administrative expenses (including an appropriate allocation for legal,
accounting, advertising, marketing and other expenses incurred in connection
with such Property, but specifically excluding general overhead expenses of the
Borrower and its Subsidiaries) minus (c) the Reserve for
Replacements for such Property for such period minus (d) the
greater of (i) the actual property management fee paid during such period
with respect to such Property and (ii) an imputed management fee in an
amount equal to 2% of the gross revenues for such Property for such period, all
as determined in accordance with GAAP.

 

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

 

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

 

“Note” means a Revolving Note, a Bid
Rate Note or a Swingline Note.

 

“Notice of Borrowing” means a notice
substantially in the form of Exhibit B to be delivered to the Agent
pursuant to Section 2.1.(b) evidencing the Borrower’s request for a
borrowing of Revolving Loans.

 

“Notice of Continuation” means a notice
substantially in the form of Exhibit C to be delivered to the Agent
pursuant to Section 2.9. evidencing the Borrower’s request for the
Continuation of a LIBOR Loan.

 

“Notice of Conversion” means a notice
substantially in the form of Exhibit D to be delivered to the Agent
pursuant to Section 2.10. evidencing the Borrower’s request for the
Conversion of a Loan from one Type to another Type.

 

20

 

“Notice of Swingline Borrowing” means a
notice substantially in the form of Exhibit F be delivered to the
Swingline Lender pursuant to Section 2.3.(b) evidencing the Borrower’s
request for a Swingline Loan.

 

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

 

“Occupancy Rate” means, with respect to
a Property at any time, the ratio, expressed as a percentage, of (a) the
net rentable square footage of such Property which is actually occupied and
upon which rent is paid pursuant to binding leases as to which no default
exists to (b) the aggregate net rentable square footage of such Property.

 

“Off Balance Sheet Liabilities” means,
with respect to any Person, (a) any repurchase obligation or liability,
contingent or otherwise, of such Person with respect to any accounts or notes
receivable sold, transferred or otherwise disposed of by such Person,
(b) any repurchase obligation or liability, contingent or otherwise, of
such Person with respect to property or assets leased by such Person as lessee
and (c) all obligations, contingent or otherwise, of such Person under any
synthetic lease, tax retention operating lease, off balance sheet loan or
similar off balance sheet financing if the transaction giving rise to such
obligation (i) is considered indebtedness for borrowed money for tax
purposes but is classified as an operating lease or (ii) does not (and is
not required pursuant to GAAP to) appear as a liability on the balance sheet of
such Person.

 

“Ownership Share” means, with respect to
any Subsidiary of a Person (other than a Wholly Owned Subsidiary) or any
Unconsolidated Affiliate of a Person, the greater of (a) such Person’s
relative nominal direct and indirect ownership interest (expressed as a
percentage) in such Subsidiary or Unconsolidated Affiliate or (b) subject
to compliance with Section 9.4.(r), such Person’s relative direct and
indirect economic interest (calculated as a percentage) in such Subsidiary or
Unconsolidated Affiliate determined in accordance with the applicable
provisions of the declaration of trust, articles or certificate of
incorporation, articles of organization, partnership agreement, joint venture
agreement or other applicable organizational document of such Subsidiary or
Unconsolidated Affiliate.

 

“Participant” has the meaning given that
term in Section 13.6.(b).

 

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

 

“Permitted Liens” means, with respect to
any Unencumbered Pool Property owned by a Person, (a) Liens securing
taxes, assessments and other charges or levies imposed by any Governmental
Authority (excluding any Lien imposed pursuant to any of the provisions of
ERISA or pursuant to any Environmental Laws) or the claims of materialmen,
mechanics,

 

21

 

carriers, warehousemen or landlords for labor, materials, supplies or
rentals incurred in the ordinary course of business, which are not at the time
required to be paid or discharged under Section 8.6.; (b) Liens
consisting of deposits or pledges made, in the ordinary course of business, in
connection with, or to secure payment of, obligations under workmen’s
compensation, unemployment insurance or similar Applicable Laws; (c) Liens
consisting of encumbrances in the nature of zoning restrictions, easements, and
rights or restrictions of record on the use of real property, which do not
materially detract from the value of such property or impair the use thereof in
the business of such Person; (d) the rights of tenants under leases or
subleases not interfering with the ordinary conduct of business of such Person;
(e) Liens in favor of the Agent for the benefit of the Lenders;
(f) any option, contract or other agreement to sell an asset provided such
sale is otherwise permitted by this Agreement; and (g) any attachment or
judgment Lien arising from a judgment or order against such Person by any court
or other tribunal so long as (i) such judgment or order is paid, stayed or
dismissed through appropriate appellate proceedings prior to the earlier of
(A) 60 days from the date of entry or (B) the date on which the
Borrower is required to deliver the next Unencumbered Pool Certificate pursuant
hereto and (ii) the amount thereof is equal to or less than $250,000.

 

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

 

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

 

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

 

“Preferred Stock” means, with respect to
any Person, shares of capital stock of, or other equity interests in, such
Person that are entitled to preference or priority over any other capital stock
of, or other equity interest in, such Person in respect of the payment of
dividends or distribution of assets upon liquidation or both.

 

“Principal Office” means
120 E. Park Place, Suite 100, El Segundo, California 90245.

 

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

 

22

 

“Property” means, with respect to any
Person, any parcel of real property, together with any building, facility,
structure, equipment or other asset located on such parcel of real property, in
each case owned by such Person.

 

“Property Management Agreements” means,
collectively, all agreements entered into by the Borrower or any other Loan
Party pursuant to which the Borrower or such other Loan Party engages a Person
to advise it with respect to the management of a given Property.

 

“Rating Agency” means S&P, Moody’s
or Fitch.

 

“Recurring Capital Expenditures” means
capital expenditures made in respect of a Property for maintenance of such
Property and replacement of items due to ordinary wear and tear including, but
not limited to, expenditures made for maintenance or replacement of carpeting,
roofing materials, mechanical systems, electrical systems and other structural
systems and expenditures relating to tenant improvements and leasing
commissions.  “Recurring Capital
Expenditures” shall not include any of the following: (a) improvements to
the appearance of such Property or any other major upgrade or renovation of
such Property not necessary for proper maintenance or marketability of such
Property; (b) capital expenditures for seismic upgrades; or
(c) capital expenditures for deferred maintenance for such Property
existing at the time such Property was acquired by the Borrower or a
Subsidiary.

 

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

 

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

 

“Requisite Lenders” means,
as of any date, Lenders having at least 66 2/3% of the aggregate amount of the
Commitments, or, if the Commitments have been terminated or reduced to zero,
Lenders holding at least 66 2/3%
of the principal amount of the Loans provided, however, that the Requisite
Lenders must include at least two Lenders.

 

“Reserve for Replacements” means, for
any period and with respect to any Property, an amount equal to the greater of
(a)(i) the aggregate square footage of all completed space of such
Property times (ii) $.10 times (iii) the number of days
in such period divided by (iv) 365 and (b)(i) the amount of
Recurring Capital Expenditures actually made in respect of such Property during
such period times (ii) the number of days in such period divided
by (iii) 365.  If the term Reserve
for Replacements is used without reference to any specific Property, then it
shall be determined on an aggregate basis with respect to all Properties and
the applicable Ownership Shares of all real property of all Unconsolidated
Affiliates.

 

23

 

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

 

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

 

“Revolving Note” means a
promissory note of the Borrower substantially in the form of Exhibit E,
payable to the order of a Lender in a principal amount equal to the amount of
such Lender’s Commitment as originally in effect and otherwise duly completed.

 

“Secured Indebtedness”
means, with respect to any Person, any Indebtedness of such Person that is
secured in any manner by any Lien on any real property and shall include such
Person’s Ownership Share of the Secured Indebtedness of any of such Person’s
Unconsolidated Affiliates.  Secured
Indebtedness shall not include Indebtedness secured by partnership interests.

 

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

 

“SIC Code” means the
Standard Industrial Classification Code, published by the United States Office
of Management and Budget.

 

“Silverton Business Center”
means that certain 467,000 square foot multi-tenant industrial property located
near Silverton Avenue, San Diego, California.

 

“Solvent” means, when used with respect
to any Person, that (a) the fair value and the fair salable value of its
assets (excluding any Indebtedness due from any affiliate of such Person) are
in excess of the fair valuation of its total liabilities (including all
contingent liabilities); (b) such Person is able to pay its debts or other
obligations in the ordinary course as they mature; and (c) such Person has
capital not unreasonably small to carry on its business and all business in
which it proposes to be engaged.

 

“S&P” means Standard & Poor’s
Rating Services, a division of The McGraw-Hill Companies, Inc.

 

24

 

“Subsidiary” means, for any Person, any
corporation, partnership, limited liability company or other entity of which at
least a majority of the securities or other ownership interests having by the
terms thereof ordinary voting power to elect a majority of the board of
directors or other persons performing similar functions of such corporation,
partnership or other entity (without regard to the occurrence of any
contingency) is at the time directly or indirectly owned or controlled by such
Person or one or more Subsidiaries of such Person or by such Person and one or
more Subsidiaries of such Person.

 

“Substantial Amount” means, at the time
of determination thereof, an amount in excess of 10% of Gross Asset Value at such time.

 

“Swingline Commitment” means the
Swingline Lender’s obligation to make Swingline Loans pursuant to
Section 2.3. in an amount up
to, but not exceeding the amount set forth in Section 2.3., as such amount
may be reduced from time to time in accordance with the terms hereof.

 

“Swingline Lender” means Wells Fargo
Bank, National Association, together with its respective successors and
assigns.

 

“Swingline Loan”
means a loan made by the Swingline Lender to the Borrower pursuant to
Section 2.3.

 

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

 

“Swingline Termination Date”
means the date which is 10 Business Days prior to the Termination Date.

 

“Tangible Net Worth” means, for any
Person and as of a given date, such Person’s total consolidated stockholders’
equity plus, in the case of the Borrower, increases in accumulated
depreciation and amortization accrued after the Agreement Date, minus
(to the extent contained in determining stockholders’ equity of such Person):
(a) the amount of any write-up in the book value of any assets reflected
in any balance sheet resulting from revaluation thereof or any write-up in
excess of the cost of such assets acquired, and (b) the aggregate of all
amounts appearing on the assets side of any such balance sheet for franchises,
licenses, permits, patents, patent applications, copyrights, trademarks,
service marks, trade names, goodwill, treasury stock, experimental or
organizational expenses and other like assets which would be classified as
intangible assets under GAAP, all determined on a consolidated basis.

 

“Taxable REIT Subsidiary”
means any corporation (other than a REIT) in which the Borrower directly or
indirectly owns stock and the Borrower and such corporation jointly elect on
IRS Form 8875 (or with respect to which IRS Form 8875 is otherwise
filed with the Internal Revenue Service) to have the corporation treated as a
taxable REIT subsidiary of Borrower under Section 856(l) of the Internal
Revenue Code.

 

25

 

“Taxes” has the meaning given that term
in Section 3.11.

 

“Termination Date” means
October 28, 2008, or such later date to which such date may be extended in
accordance with Section 2.13.

 

“Total Annualized Base Rents”
means the aggregate Annualized Base Rents of all tenants of all Properties
owned by the Borrower, a Loan Party and all other Subsidiaries.

 

“Total Budgeted Cost” means, with
respect to a Development Property, and at any time, the aggregate amount of all
costs budgeted to be paid, incurred or otherwise expended or accrued by the
Borrower, a Subsidiary or an Unconsolidated Affiliate with respect to such
Property to achieve an Occupancy Rate of 100% (excluding tenant improvements),
including without limitation, all amounts budgeted with respect to all of the
following:  (a) acquisition of land
and any related improvements; (b) a reasonable and appropriate reserve for
construction interest; (c) a reasonable and appropriate operating deficit
reserve; (d) leasing commissions and (e) other hard and soft costs
associated with the development or redevelopment of such Property.

 

“Total Liabilities” means, as to any
Person as of a given date, all liabilities which would, in conformity with
GAAP, be properly classified as a liability on a consolidated balance sheet of
such Person as of such date, and in any event shall include (without
duplication): (a) all Indebtedness of such Person (whether or not
Nonrecourse Indebtedness and whether or not secured by a Lien), including
without limitation, Capitalized Lease Obligations and reimbursement obligations
with respect to any letter of credit; (b) all accounts payable and accrued
expenses of such Person; (c) all purchase and repurchase obligations and
forward commitments of such Person to the extent such obligations or
commitments are evidenced by a binding purchase agreement (forward commitments
shall include without limitation (i) forward equity commitments and
(ii) commitments to purchase any real property under development,
redevelopment or renovation); (d) all unfunded obligations of such Person;
(e) all lease obligations of such Person (including ground leases) to the
extent required under GAAP to be classified as a liability on a balance sheet
of such Person; (f) all contingent obligations of such Person including,
without limitation, all Guarantees of Indebtedness by such Person; (g) all
liabilities of any Unconsolidated Affiliate of such Person, which liabilities
such Person has Guaranteed or is otherwise obligated on a recourse basis; and
(h) such Person’s Ownership Share of the Indebtedness of any
Unconsolidated Affiliate of such Person, including Nonrecourse Indebtedness of
such Person.  For purposes of clauses
(c) and (d) of this definition, the amount of Total Liabilities of a
Person at any given time in respect of (x) a contract to purchase or
otherwise acquire unimproved or fully developed real property shall be equal to
(i) the total purchase price payable by such Person under such contract
if, at such time, the seller of such real property would be entitled to
specifically enforce such contract against such Person, otherwise,
(ii) the aggregate amount of due diligence deposits, earnest money
payments and other similar payments made by such Person under such contract
which, at such time, would be subject to forfeiture upon termination of the
contract and (y) a contract relating to the acquisition of real property
which the seller is required to develop or renovate prior to, and as a
condition precedent to, such acquisition, shall equal the maximum amount
reasonably estimated to be payable by such Person under such contract assuming
performance by the seller of its obligations under such contract, which amount
shall include, without limitation, any amounts payable after

 

26

 

consummation of such
acquisition which may be based on certain performance levels or other related
criteria.  For purposes of this
definition, if the assets of a Subsidiary of a Person consist solely of Equity
Interests in one Unconsolidated Affiliate of such Person and such Person is not
otherwise obligated in respect of the Indebtedness of such Unconsolidated
Affiliate, then only such Person’s Ownership Share of the Indebtedness of such
Unconsolidated Affiliate shall be included as Total Liabilities of such Person.

 

“Type” with respect to any
Revolving Loan, refers to whether such Loan is a LIBOR Loan or a Base Rate
Loan, or in the case of a Bid Rate Loan only, an Absolute Rate Loan or a LIBOR
Margin Loan.

 

“UCC” means the Uniform Commercial Code
as in effect in any applicable jurisdiction.

 

“Unconsolidated Affiliate” means, with
respect to any Person, any other Person in whom such Person holds an
Investment, which Investment is accounted for in the financial statements of
such Person on an equity basis of accounting and whose financial results would
not be consolidated under GAAP with the financial results of such Person on the
consolidated financial statements of such Person.

 

“Unencumbered Pool Certificate”
means a report, certified by the chief financial officer of the Borrower in the
manner provided for in Exhibit Q setting forth the calculations required
to establish the Borrowing Base as of a specified date, all in form and detail
satisfactory to the Agent.

 

“Unencumbered Pool Properties”
means those Eligible Properties that, pursuant to the terms of this Agreement,
are to be included when calculating the Maximum Loan Availability.

 

“Unencumbered Pool Value”
means, at any time, the following amount as determined for an Unencumbered Pool
Property: (a) the Net Operating Income of such Unencumbered Pool Property
for the fiscal quarter most recently ended times (b) 4 and divided
by (c) 9.0%.   If an
Unencumbered Pool Property was acquired by the Borrower or a Subsidiary during
the immediately preceding fiscal quarter, then such Unencumbered Pool Property
shall have an Unencumbered Pool Value equal to the purchase price paid by the
Borrower or any Subsidiary (less any amounts paid to the Borrower or such
Subsidiary as a purchase price adjustment, held in escrow, retained as a
contingency reserve, or in connection with other similar arrangements).  Notwithstanding the foregoing, the
Unencumbered Pool Value of the Silverton Business Center shall not exceed
$45,000,000.

 

“Unfunded Liabilities” means, with
respect to any Plan at any time, the amount (if any) by which (a) the
value of all benefit liabilities under such Plan, determined on a plan
termination basis using the assumptions prescribed by the PBGC for purposes of
Section 4044 of ERISA, exceeds (b) the fair market value of all Plan
assets allocable to such liabilities under Title IV of ERISA (excluding any
accrued but unpaid contributions), all determined as of the then most recent
valuation date for such Plan, but only to the extent that such excess
represents a potential liability of a member of the ERISA Group to the PBGC or
any other Person under Title IV of ERISA.

 

27

 

“Unsecured Indebtedness”
means, with respect to a Person, all Indebtedness of such Person that is not
Secured Indebtedness.

 

“Unsecured Liabilities”
means, as to any Person as of a given date, the sum of the following (without
duplication): (a) all liabilities which would, in conformity with GAAP, be
properly classified as a liability on the balance sheet of such Person as at
such date plus (b) all Unsecured Indebtedness of such Person.

 

“Wells Fargo” means Wells Fargo Bank,
National Association, and its successors and permitted assigns.

 

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

 

Section 1.2.  General; References to San Francisco Time.

 

Unless otherwise indicated, all accounting terms, ratios and
measurements shall be interpreted or determined in accordance with GAAP in
effect as of the Agreement Date. References in this Agreement to “Sections”, “Articles”,
“Exhibits” and “Schedules” are to sections, articles, exhibits and schedules
herein and hereto unless otherwise indicated. 
References in this Agreement to any document, instrument or agreement
(a) shall include all exhibits, schedules and other attachments thereto,
(b) shall include all documents, instruments or agreements issued or executed
in replacement thereof, to the extent permitted hereby and (c) shall mean
such document, instrument or agreement, or replacement or predecessor thereto,
as amended, supplemented, restated or otherwise modified from time to time to
the extent permitted hereby and in effect at any given time.  Wherever from the context it appears
appropriate, each term stated in either the singular or plural shall include
the singular and plural, and pronouns stated in the masculine, feminine or
neuter gender shall include the masculine, the feminine and the neuter.  Unless explicitly set forth to the contrary,
a reference to “Subsidiary” means a Subsidiary of the Borrower or a Subsidiary
of such Subsidiary and a reference to an “Affiliate” means a reference to an
Affiliate of the Borrower.  Titles and
captions of Articles, Sections, subsections and clauses in this Agreement are
for convenience only, and neither limit nor amplify the provisions of this
Agreement.  Unless otherwise indicated,
all references to time are references to San Francisco, California time.

 

ARTICLE II. CREDIT
FACILITY

 

Section 2.1.  Revolving Loans.

 

(a)           Making of Revolving
Loans.  Subject to the terms and
conditions set forth in this Agreement, including without limitation,
Section 2.14. below, each
Lender severally and not jointly agrees to make Revolving Loans to the Borrower
during the period from and including the Effective Date to but excluding the
Termination Date, in an aggregate principal amount at

 

28

 

any one time outstanding up to, but not exceeding, such Lender’s Pro
Rata Share of the Maximum Loan Availability (but in no event in excess of such
Lender’s Commitment).  Within the
foregoing limits and subject to the terms and conditions of this Agreement, the
Borrower may borrow, repay and reborrow Revolving Loans.

 

(b)           Requests for
Revolving Loans. Not later than 9:00 a.m. San Francisco time at least
two (2) Business Days prior to a borrowing of Base Rate Loans and not
later than 9:00 a.m. San Francisco time at least three (3) Business
Days prior to a borrowing of LIBOR Loans, the Borrower shall deliver to the
Agent a Notice of Borrowing.  Each Notice
of Borrowing shall specify the aggregate principal amount of the Revolving
Loans to be borrowed, the date such Revolving Loans are to be borrowed (which
must be a Business Day), the use of the proceeds of such Revolving Loans, the
Type of the requested Revolving Loans, and if such Revolving Loans are to be
LIBOR Loans, the initial Interest Period for such Revolving Loans.  Each Notice of Borrowing shall be irrevocable
once given and binding on the Borrower. 
Prior to delivering a Notice of Borrowing, the Borrower may (without
specifying whether a Revolving Loan will be a Base Rate Loan or a LIBOR Loan)
request that the Agent provide the Borrower with the most recent LIBOR rate
available to the Agent.  The Agent shall
provide such quoted rate to the Borrower and to the Lenders on the date of such
request or as soon as possible thereafter.

 

(c)           Funding of Revolving
Loans.  Promptly after receipt of a
Notice of Borrowing under the immediately preceding subsection (b), the Agent shall notify each Lender by telex or telecopy, or
other similar form of transmission of the proposed borrowing.  Each Lender shall deposit an amount equal to
the Revolving Loan to be made by such Lender to the Borrower with the Agent at
the Principal Office, in immediately available funds not later than
9:00 a.m. San Francisco time on the date of such proposed Revolving Loans.  Subject to fulfillment of all applicable
conditions set forth herein, the Agent shall make available to the Borrower at
the Principal Office, not later than 12:00 noon San Francisco time on the date
of the requested borrowing of Revolving Loans, the proceeds of such amounts
received by the Agent.  No Lender shall
be responsible for the failure of any other Lender to make a Loan or to perform
any other obligation to be made or performed by such other Lender hereunder, and
the failure of any Lender to make a Loan or to perform any other obligation to
be made or performed by it hereunder shall not relieve the obligation of any
other Lender to make any Loan or to perform any other obligation to be made or
performed by such other Lender.

 

(d)           Assumptions
Regarding Funding by Lenders.  With
respect to Revolving Loans to be made after the Effective Date, unless the
Agent shall have been notified by any Lender that such Lender will not make
available to the Agent a Revolving Loan to be made by such Lender, the Agent may
assume that such Lender will make the proceeds of such Revolving Loan available
to the Agent in accordance with this Section and the Agent may (but shall
not be obligated to), in reliance upon such assumption, make available to the
Borrower the amount of such Revolving Loan to be provided by such Lender.

 

(e)           Reallocation of
Existing Revolving Loans.  Upon the
Effective Date, all Revolving Loans (as defined under the Existing Credit
Agreement) outstanding under the Existing Credit Agreement shall be deemed to
be Revolving Loans outstanding hereunder being of the same Types, and in the
case of LIBOR Loans, having the same Interest Periods.  As of the

 

29

 

Effective Date, such Revolving Loans shall be allocated among the
Lenders in accordance with their respective Pro Rata Shares.  Each Lender agrees to make such payments to
the other Lenders and any Person who ceases to be a “Lender” under the Existing
Credit Agreement upon the Effective Date in such amounts as are necessary to
effect such allocation.  All such
payments shall be made to the Agent for the account of the Person to be
paid.  The Borrower shall pay any amounts
payable to any Lenders under Section 5.4. as a result of such allocation.

 

Section 2.2.  Bid Rate Loans.

 

(a)           Bid Rate Loans.  In addition to borrowings of Revolving Loans,
at any time during the period from the Effective Date to but excluding the
Termination Date, and so long as the Borrower continues to maintain an
Investment Grade Rating from any two of S&P, Moody’s and Fitch, the
Borrower may, as set forth in this Section, request the Lenders to make offers
to make Bid Rate Loans to the Borrower in Dollars.  The Lenders may, but shall have no obligation
to, make such offers and the Borrower may, but shall have no obligation to,
accept any such offers in the manner set forth in this Section.

 

(b)           Requests for Bid
Rate Loans.  When the Borrower wishes
to request from the Lenders offers to make Bid Rate Loans, it shall give the
Agent notice (a “Bid Rate Quote Request”) so as to be received no later than
9:00 a.m. San Francisco time on (x) the Business Day immediately
preceding the date of borrowing proposed therein, in the case of an Absolute
Rate Auction and (y) the date four Business Days prior to the proposed
date of borrowing, in the case of a LIBOR Auction.  The Agent shall deliver to each Lender a copy
of each Bid Rate Quote Request promptly upon receipt thereof by the Agent.  The Borrower may request offers to make Bid
Rate Loans for up to 3 different Interest Periods in each Bid Rate Quote
Request (for which purpose Interest Periods in different lettered clauses of
the definition of the term “Interest Period” shall be deemed to be different
Interest Periods even if they are coterminous); provided that the request for
each separate Interest Period shall be deemed to be a separate Bid Rate Quote
Request for a separate borrowing (a “Bid Rate Borrowing”).  Each Bid Rate Quote Request shall be
substantially in the form of Exhibit H and shall specify as to each Bid
Rate Borrowing all of the following:

 

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

 

(ii)           the
aggregate amount of such Bid Rate Borrowing which shall be in a minimum amount
of $10,000,000 and integral multiples of $1,000,000 in excess thereof which
shall not cause any of the limits specified in Section 2.14. to be
violated;

 

(iii)          whether
the Bid Rate Quote Request is for LIBOR Margin Loans or Absolute Rate Loans;
and

 

(iv)          the
duration of the Interest Period applicable thereto, which shall not extend
beyond the Termination Date.

 

The Borrower shall not deliver any Bid Rate Quote Request within five Business Days of the giving of any other
Bid Rate Quote Request and the Borrower shall not deliver more than two Bid
Rate Quote Requests in any calendar month.

 

30

 

(c)           Bid
Rate Quotes.

 

(i)            Each
Lender may submit one or more Bid Rate Quotes, each containing an offer to make
a Bid Rate Loan in response to any Bid Rate Quote Request; provided that, if
the Borrower’s request under Section 2.2.(b) specified more than one
Interest Period, such Lender may make a single submission containing only one
Bid Rate Quote for each such Interest Period. 
Each Bid Rate Quote must be submitted to the Agent not later than
7:30 a.m. San Francisco time (x) on the proposed date of borrowing,
in the case of an Absolute Rate Auction or (y) on the date three Business
Days prior to the proposed date of borrowing, in the case of a LIBOR Auction,
and in either case the Agent shall disregard any Bid Rate Quote received after
such time; provided that the Lender then acting as the Agent may submit a Bid
Rate Quote only if it notifies the Borrower of the terms of the offer contained
therein not later than 30 minutes prior to the latest time by which the Lenders
must submit applicable Bid Rate Quotes. 
Subject to Articles VI. and XI., any Bid Rate Quote so made shall be
irrevocable.  Such Bid Rate Loans may be
funded by a Lender’s Designated Lender (if any) as provided in
Section 13.6.(d), however such Lender shall not be required to specify in
its Bid Rate Quote whether such Bid Rate Loan will be funded by such Designated
Lender.

 

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

 

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

 

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

 

(C)           in
the case of an Absolute Rate Auction, the rate of interest per annum (rounded
upwards, if necessary, to the nearest 1/1,000th of 1%) offered for each such
Absolute Rate Loan (the “Absolute Rate”);

 

(D)          in the case
of a LIBOR Auction, the margin above or below applicable LIBOR (the “LIBOR
Margin”) offered for each such LIBOR Margin Loan, expressed as a percentage to
be added to (or subtracted from) the applicable LIBOR;

 

(E)           the
identity of the quoting Lender; and

 

(F)           any
Bid Rate Quote shall be in a minimum amount of $5,000,000 and integral multiples of $100,000 in
excess thereof.

 

31

 

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

 

(d)           Notification by
Agent.  The Agent shall, as promptly
as practicable after the Bid Rate Quotes are submitted (but in any event not
later than 8:30 a.m. San Francisco time (x) on the proposed date of
borrowing, in the case of an Absolute Rate Auction or (y) on the date
three Business Days prior to the proposed date of borrowing, in the case of a
LIBOR Auction), notify the Borrower of the terms (i) of any Bid Rate Quote
submitted by a Lender that is in accordance with Section 2.2.(c). and
(ii) of any Bid Rate Quote that amends, modifies or is otherwise
inconsistent with a previous Bid Rate Quote submitted by such Lender with
respect to the same Bid Rate Quote Request. 
Any such subsequent Bid Rate Quote shall be disregarded by the Agent
unless such subsequent Bid Rate Quote is submitted solely to correct a manifest
error in such former Bid Rate Quote.  The
Agent’s notice to the Borrower shall specify (A) the aggregate principal
amount of the Bid Rate Borrowing for which offers have been received and
(B) the principal amounts and Absolute Rates or LIBOR Margins, as
applicable, so offered by each Lender.

 

(e)           Acceptance
by Borrower.

 

(i)            Not
later than 9:30 a.m. San Francisco time (x) on the proposed date of
borrowing, in the case of an Absolute Rate Auction or (y) on the date
three Business Days prior to the proposed date of borrowing, in the case of a
LIBOR Auction, the Borrower shall notify the Agent of its acceptance or
nonacceptance of the offers so notified to it pursuant to Section 2.2.(d).
which notice shall be in the form of Exhibit J.  In the case of acceptance, such notice shall
specify the aggregate principal amount of offers for each Interest Period that
are accepted.  The failure of the
Borrower to give such notice by such time shall constitute nonacceptance.  The Borrower may accept any Bid Rate Quote in
whole or in part; provided that:

 

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

 

(B)           the
aggregate principal amount of each Bid Rate Borrowing shall comply with the
provisions of Section 2.2.(b)(ii) but shall not cause the limits
specified in Section 2.14. to be violated;

 

(C)           acceptance
of offers may be made only in ascending order of Absolute Rates or LIBOR
Margins, as applicable, in each case beginning with the lowest rate so offered;

 

(D)          any
acceptance in part by the Borrower shall be in a minimum amount of $5,000,000
and integral multiples of $100,000 in excess thereof; and

 

32

 

(E)           the
Borrower may not accept any offer that fails to comply with
Section 2.2.(c) or otherwise fails to comply with the requirements of
this Agreement.

 

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

 

(f)            Obligation to Make
Bid Rate Loans.  The Agent shall
promptly (and in any event not later than (x) 10:00 a.m. San
Francisco time on the proposed date of borrowing of Absolute Rate Loans and
(y) on the date three Business Days prior to the proposed date of
borrowing of LIBOR Margin Loans) notify each Lender that submitted a Bid Rate
Quote as to whose Bid Rate Quote has been accepted and the amount and rate
thereof.  A Lender who is notified that
it has been selected to make a Bid Rate Loan may designate its Designated
Lender (if any) to fund such Bid Rate Loan on its behalf, as described in
Section 13.6.(d). Any Designated Lender which funds a Bid Rate Loan shall
on and after the time of such funding become the obligee under such Bid Rate
Loan and be entitled to receive payment thereof when due.  No Lender shall be relieved of its obligation
to fund a Bid Rate Loan, and no Designated Lender shall assume such obligation,
prior to the time the applicable Bid Rate Loan is funded.  Any Lender whose offer to make any Bid Rate
Loan has been accepted shall, not later than 11:00 a.m. San Francisco time
on the date specified for the making of such Loan, make the amount of such Loan
available to the Agent at its Principal Office in immediately available funds,
for the account of the Borrower.  The
amount so received by the Agent shall, subject to the terms and conditions of
this Agreement, be made available to the Borrower not later than 12:00 noon on
such date by depositing the same, in immediately available funds, in an account
of the Borrower designated by the Borrower.

 

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

 

Section 2.3.  Swingline Loans.

 

(a)           Swingline Loans.  Subject to the terms and conditions hereof,
including without limitation Section 2.14., the Swingline Lender agrees to
make Swingline Loans to the Borrower, during the period from the Effective Date
to but excluding the Swingline Termination Date, in an aggregate principal
amount at any one time outstanding up to, but not exceeding, $50,000,000, as
such amount may be reduced from time to time in accordance with the terms
hereof.  If at any time the aggregate
principal amount of the Swingline Loans outstanding at such time exceeds the
Swingline Commitment in effect at such time, the Borrower shall immediately pay
the Agent for the account of the Swingline Lender the amount of such excess.  Subject to the terms and conditions of this
Agreement, the Borrower may borrow, repay and reborrow Swingline Loans
hereunder.

 

33

 

(b)           Procedure for
Borrowing Swingline Loans.  The
Borrower shall give the Agent and the Swingline Lender notice pursuant to a
Notice of Swingline Borrowing delivered no later than 9:00 a.m. San
Francisco time on the proposed date of such borrowing.  Any telephonic notice shall include all
information to be specified in a written Notice of Swingline Borrowing.  Not later than 11:00 a.m. San Francisco
time on the date of the requested Swingline Loan and subject to satisfaction of
the applicable conditions set forth in Article VI. for such borrowing, the
Swingline Lender will make the proceeds of such Swingline Loan available to the
Borrower in Dollars, in immediately available funds, at the account specified
by the Borrower in the Notice of Swingline Borrowing.

 

(c)           Interest.  Swingline Loans shall bear interest at a per
annum rate equal to “one month LIBOR” (as such rate is referenced on the date
such Swingline Loan is made) with an Interest Period of up to 10 Business Days (as designated by the Borrower in the Notice
of Swingline Borrowing) plus the Applicable Margin or at such other rate or
rates as the Borrower and the Swingline Lender may agree from time to time in
writing.  All accrued and unpaid interest
on Swingline Loans shall be payable on the dates and in the manner provided in
Section 2.4. (except as the Swingline Lender and the Borrower may otherwise
agree in writing in connection with any particular Swingline Loan).

 

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

 

(e)           Repayment and
Participations of Swingline Loans. 
The Borrower agrees to repay each Swingline Loan within 10 Business Days after the date such
Swingline Loan was made.  Notwithstanding
the foregoing, the Borrower shall repay the entire outstanding principal amount
of, and all accrued but unpaid interest on, the Swingline Loans on the
Swingline Termination Date (or such earlier date as the Swingline Lender and
the Borrower may agree in writing).  The
Borrower, or the Swingline Lender on behalf of the Borrower (which hereby
irrevocably directs the Swingline Lender to act on its behalf), may request a
borrowing of Base Rate Loans from the Lenders in an amount equal to the
principal balance of such Swingline Loan. 
The Swingline Lender shall give notice to the Agent and the Borrower of
any such borrowing of Base Rate Loans not later than 9:00 a.m. San
Francisco time at least one Business Day prior to the proposed date of such
borrowing.  The Borrower shall give notice
to the Agent of any such borrowing of Base Rate Loans not later than
9:00 a.m. San Francisco time at least two Business Days prior to the
proposed date of such borrowing.  The
amount limitations contained in Section 3.5. shall not apply to any borrowing
of Base Rate Loans made pursuant to this subsection.  Each Lender will make available to the Agent
at the Principal Office for the account of the Swingline Lender, in immediately
available funds, the proceeds of the Base Rate Loan to be made by such Lender.  The Agent shall pay the proceeds of such Base
Rate Loans to the Swingline Lender, which shall

 

34

 

apply such proceeds to repay such Swingline Loan.  If the Lenders are prohibited from making
Loans required to be made under this subsection for any reason whatsoever,
including without limitation, the occurrence of any of the Defaults or Events
of Default described in Sections 11.1.(e). and (f)., each Lender shall
purchase from the Swingline Lender, without recourse or warranty, an undivided
interest and participation to the extent of such Lender’s Pro Rata Share of
such Swingline Loan, by directly purchasing a participation in such Swingline
Loan in such amount and paying the proceeds thereof to the Agent for the
account of the Swingline Lender in Dollars and in immediately available
funds.  A Lender’s obligation to purchase
such a participation in a Swingline Loan shall be absolute and unconditional
and shall not be affected by any circumstance whatsoever, including without
limitation, (i) any claim of setoff, counterclaim, recoupment, defense or
other right which such Lender or any other Person may have or claim against the
Agent, the Swingline Lender or any other Person whatsoever, (ii) the
occurrence or continuation of a Default or Event of Default (including without
limitation, any of the Defaults or Events of Default described in
Sections 11.1.(e). and (f)), or the termination of any Lender’s
Commitment, (iii) the existence (or alleged existence) of an event or
condition which has had or could have a Material Adverse Effect, (iv) any
breach of any Loan Document by the Agent, any Lender or the Borrower or
(v) any other circumstance, happening or event whatsoever, whether or not
similar to any of the foregoing.  If such
amount is not in fact made available to the Swingline Lender by any Lender, the
Swingline Lender shall be entitled to recover such amount on demand from such
Lender, together with accrued interest thereon for each day from the date of
demand thereof, at the Federal Funds Rate. 
If such Lender does not pay such amount forthwith upon the Swingline
Lender’s demand therefor, and until such time as such Lender makes the required
payment, the Swingline Lender shall be deemed to continue to have outstanding
Swingline Loans in the amount of such unpaid participation obligation for all
purposes of the Loan Documents (other than those provisions requiring the other
Lenders to purchase a participation therein). 
Further, such Lender shall be deemed to have assigned any and all
payments made of principal and interest on its Loans, and any other amounts due
it hereunder, to the Swingline Lender to fund Swingline Loans in the amount of
the participation in Swingline Loans that such Lender failed to purchase
pursuant to this Section until such amount has been purchased (as a result
of such assignment or otherwise).

 

Section 2.4.  Rates and Payment of Interest on Loans.

 

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

 

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

 

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

 

(iii)          during
such periods as such Loan is an Absolute Rate Loan,  at the Absolute Rate for such Loan for the
Interest Period therefor quoted by the Lender making such Loan in accordance
with Section 2.2.; and

 

35

 

(iv)          during
such periods as such Loan is a LIBOR Margin Loan, at LIBOR for such Loan for
the Interest Period therefor plus the LIBOR Margin quoted by the Lender making
such Loan in accordance with Section 2.2.

 

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

 

(b)           Payment of Interest.
All accrued and unpaid interest on the outstanding principal amount of each
Loan shall be payable (i)(A) in the case of a Base Rate Loan, quarterly in
arrears on the first day of each April, July, October and January,
commencing with January 2, 2006, (B) in the case of a LIBOR Loan on
the last day of each Interest Period therefor and, if such Interest Period is
longer than three months, at three-month intervals following the first day of
such Interest Period, and (C) in the case of a Bid Rate Loan, on the last
day of each Interest Period therefor and, if such Interest Period is longer
than three months, at three-month intervals following the first day of such
Interest Period, and (ii) for all Loans, (A) on the Termination Date
and (B) on any date on which the principal balance of such Loan is due and
payable in full.  Interest payable at the
Post-Default Rate shall be payable from time to time on demand.  All determinations by the Agent of an
interest rate hereunder shall be conclusive and binding on the Lenders and the
Borrower for all purposes, absent manifest error.

 

Section 2.5.  Number of Interest Periods.

 

There may be no more than 10 different Interest Periods with respect to
the LIBOR Loans and Bid Rate Loans
on a collective basis outstanding at the same time.

 

Section 2.6.  Repayment of Loans.

 

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

 

Section 2.7.  Prepayments.

 

(a)           Optional.  Subject to Section 5.4., the Borrower
may prepay any Loan at any time without premium or penalty.  The Borrower shall give the Agent at least 3
Business Days prior written notice of the prepayment of any Loan.  Bid Rate Loans may not be prepaid at the
option of the Borrower.

 

36

 

(b)           Mandatory.

 

(i)            Commitment
Overadvance.  If at any time the
aggregate principal amount of all outstanding Revolving Loans exceeds the
aggregate amount of the Commitments, the Borrower shall immediately upon demand
pay to the Agent for the account of the Lenders, the amount of such excess.

 

(ii)           Borrowing
Base Overadvance.  If at any time the
aggregate principal amount of all outstanding Revolving Loans exceeds the
Maximum Loan Availability, the Borrower shall within 5 days of the Borrower
obtaining knowledge of the occurrence of any such excess, deliver to the Agent
for prompt distribution to each Lender a written plan acceptable to all of the
Lenders to eliminate such excess.  If
such excess is not eliminated within 15 Business Days of the Borrower obtaining
knowledge of the occurrence thereof, then the entire outstanding principal
balance of all Loans, together with all accrued interest thereon, shall be
immediately due and payable in full.

 

(iii)          Bid
Rate Facility Overadvance.  If at any
time the aggregate principal amount of all outstanding Bid Rate Loans exceeds
one-half of the aggregate amount of all Commitments at such time, then the
Borrower shall immediately pay to the Agent for the accounts of the applicable
Lenders the amount of such excess.  Such
payment shall be applied as provided in Section 3.2.(e).

 

All payments under this subsection (b) shall be applied to
pay all amounts of excess principal outstanding on the applicable Loans in
accordance with Section 3.2.

 

Section 2.8.  Late Charges.

 

If any payment required under this Agreement
is not paid within 10 days after the Borrower has received notice from the
Agent that such payment has not been made, the Borrower shall pay a late charge
for late payment to compensate the Lenders for the loss of use of funds and for
the expenses of handling the delinquent payment, in an amount equal to two
percent (2%) of such delinquent payment. 
Such late charge shall be paid in any event not later than the due date
of the next subsequent installment of principal and/or interest.  In the event the maturity of the Obligations
hereunder occurs or is accelerated pursuant to Section 2.7.(b)(ii) or
Section 11.2., this Section shall apply only to payments overdue
prior to the time of such acceleration. 
This Section shall not be deemed to be a waiver of the Lenders’
right to accelerate payment of any of the Obligations as permitted under the
terms of this Agreement.

 

Section 2.9.  Continuation.

 

So long as no Default or Event of Default
exists, the Borrower may on any Business Day, with respect to any LIBOR Loan,
elect to maintain such LIBOR Loan or any portion thereof as a LIBOR Loan by
selecting a new Interest Period for such LIBOR Loan.  Each new Interest Period selected under this Section shall
commence on the day following 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 9:00 a.m. San Francisco time on the third
Business Day prior to the date of any such Continuation.  Such notice by the Borrower of a

 

37

 

Continuation shall be by telecopy or other similar form of transmission
in the form of a Notice of Continuation, specifying (a) the proposed date
of such Continuation, (b) the LIBOR Loan and portion thereof subject to
such Continuation and (c) the duration of the selected Interest Period,
all of which shall be specified in such manner as is necessary to comply with
all limitations on Loans outstanding hereunder. 
Each Notice of Continuation shall be irrevocable by and binding on the
Borrower once given.  Promptly after
receipt of a Notice of Continuation, the Agent shall notify each Lender by
telecopy or other similar form of transmission of the proposed
Continuation.  If the Borrower shall fail
to select in a timely manner a new Interest Period for any LIBOR Loan in
accordance with this Section, 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 2.10.

 

Section 2.10.  Conversion.

 

So long as no Default or Event of Default
exists, the Borrower may on any Business Day, upon the Borrower’s giving of a
Notice of Conversion to the Agent, Convert all or a portion of a Loan of one
Type into a Loan of another Type.  Any
Conversion of a LIBOR Loan into a Base Rate Loan shall be made on, and only on,
the last day of an Interest Period for such LIBOR Loan and, upon Conversion of
a Base Rate Loan into a LIBOR Loan, the Borrower shall pay accrued interest to
the date of Conversion on the principal amount so Converted.  Each such Notice of Conversion shall be given
not later than 9:00 a.m. San Francisco time one Business Day prior to the
date of any proposed Conversion into Base Rate Loans and three Business Days
prior to the date of any proposed Conversion into LIBOR Loans.  Promptly after receipt of a Notice of
Conversion, the Agent shall notify each Lender by telecopy, electronic mail or
other similar form of transmission of the proposed Conversion.  Subject to the restrictions specified above,
each Notice of Conversion shall be by telecopy in the form of a Notice of
Conversion specifying (a) the requested date of such Conversion, (b) the
Type of Loan to be Converted, (c) the portion of such Type of Loan to be
Converted, (d) the Type of Loan such Loan is to be Converted into and (e) if
such Conversion is into a LIBOR Loan, the requested duration of the Interest
Period of such Loan.  Each Notice of
Conversion shall be irrevocable by and binding on the Borrower once given.

 

Section 2.11.  Notes.

 

The Revolving Loans made by each Lender
shall, in addition to this Agreement, also be evidenced by a Revolving Note,
payable to the order of such Lender in a principal amount equal to the amount
of its Commitment as originally in effect and otherwise duly completed.  The Bid Rate Loans made by any Lender to the
Borrower shall, in addition to this Agreement, also be evidenced by a Bid Rate
Note payable to the order of such Lender. 
The Swingline Loans made by the Swingline Lender to the Borrower shall,
in addition to this Agreement, also be evidenced by a Swingline Note payable to
the order of the Swingline Lender.

 

Section 2.12.  Voluntary Reductions of the Commitment.

 

The Borrower may terminate or reduce the
amount of the Commitments (for which purpose use of the Commitments shall be
deemed to include the aggregate principal amount of all outstanding Bid Rate
Loans and Swingline Loans) at any time and from time to time without

 

38

 

penalty or premium upon not less than five (5) Business Days prior
notice to the Agent of each such termination or reduction, which notice shall
specify the effective date thereof and the amount of any such reduction (which
in the case of any partial reduction of the Commitments shall not be less than
$10,000,000 and integral multiples
of $1,000,000 in excess of that amount in the aggregate) and shall be irrevocable
once given and effective only upon receipt by the Agent (“Prepayment Notice”).  Promptly after receipt of a Prepayment Notice
the Agent shall notify each Lender by telecopy, or other similar form of
transmission of the proposed termination or Commitment reduction.   The Commitments,
once reduced pursuant to this Section, may not be increased.  The Borrower shall pay all interest and fees,
on the Loans accrued to the date of such reduction or termination of the
Commitments to the Agent for the account of the Lenders, including but not
limited to any applicable compensation due to each Lender in accordance with Section 5.4.
of this Agreement.

 

Section 2.13.  Extension of Termination Date.

 

(a)           Initial
Extension.  The Borrower may request
that the Agent and the Lenders extend the current Termination Date by one year
by executing and delivering to the Agent at least 120 days but not more than
360 days prior to the current Termination Date, a written request for such
extension in the form of Exhibit M (an “Extension Request”).  The Agent shall forward to each Lender a copy
of the Extension Request delivered to the Agent promptly upon receipt
thereof.  Subject to satisfaction of the
following conditions, the Termination Date shall be extended for one year: (a) immediately
prior to such extension and immediately after giving effect thereto, no Default
or Event of Default shall have occurred and be continuing and (b) the
Borrower shall have paid the Fees payable under Section 3.6.(e).  The Termination Date may be extended only one
time pursuant to this subsection.

 

(b)           Subsequent
Extension.  In addition to the
extension option set forth in the immediately preceding clause (a), the
Borrower shall have the right, exercisable one time, to request that the Agent
and the Lenders agree to extend the then current Termination Date by an
additional year.  To exercise such right
the Borrower shall execute and deliver an Extension Request to the Agent at
least 120 days but not more than 360 days prior to the then current Termination
Date (as such date has been extended pursuant to subsection (a) above).  If the Agent shall receive such a request,
the Agent shall forward a copy of it to each Lender promptly upon receipt
thereof.  If all of the Lenders shall
have notified the Agent on or before the date 45 days after receipt by the
Lenders of such request that they accept such request, then, upon payment of
the extension fee payable under Section 3.6.(e). the Termination Date
shall be extended for a single one-year period. 
If any Lender shall not have notified the Agent on or prior to the date
which is the date 45 days after receipt by the Lenders of such request that it
accepts the such request, the Termination Date shall not be extended except as
otherwise permitted under the immediately following subsection (c).  The Agent shall promptly notify the Borrower
whether a request for an extension has been accepted or rejected as well as
which Lender or Lenders rejected such request (each such Lender, a “Rejecting
Lender”).  The Borrower understands and
acknowledges that (i) this Section has been included in this
Agreement for the Borrower’s convenience in requesting an extension of the
Termination Date; (ii) neither the Agent nor any Lender has promised
(either expressly or impliedly), nor does the Agent or any Lender have any
obligation or commitment whatsoever, to extend the Termination Date and (iii) the
Agent and the Lenders may condition any such extension on such terms and
conditions

 

39

 

as they may deem appropriate in their sole and absolute
discretion.  Notwithstanding the
preceding subsections, if Requisite Lenders do not approve a request for an
extension of the Termination Date or if a Default or Event of Default exists on
the then current Termination Date or would exist after giving effect to any of
the transactions contemplated by this Section, then the Termination Date shall
not be extended.

 

(c)           Rejecting
Lenders.  Notwithstanding the
preceding subsection (b), if the Borrower receives notification from the
Agent that a request for an extension of the Termination Date has been rejected
(a “Notice of Rejection”), and provided that the Lenders comprising the
Requisite Lenders have approved of such request, the Borrower may elect, with
respect to each such Rejecting Lender, by giving written notice to the Agent of
such election within 30 days after receipt by the Borrower of a Notice of
Rejection, to either (i) require such Rejecting Lender to assign its
Commitment to an Eligible Assignee as contemplated in the immediately following
clause (x) or (ii) pay in full the amount of Loans, interest and fees
owing to such Rejecting Lender and terminate such Rejecting Lender’s Commitment
as contemplated in the immediately following clause (y).  If the Borrower has made a timely election as
permitted by the preceding sentence, then the Borrower shall take either of the
following actions as specified in such election: (x) demand that such Rejecting
Lender, and upon such demand such Rejecting Lender shall be obligated to,
assign its Commitment to an Eligible Assignee subject to and in accordance with
the provisions of Section 13.6.(c) for a purchase price equal to the
aggregate principal balance of Loans then outstanding and owing to such Rejecting
Lender plus any accrued but unpaid interest thereon and accrued but
unpaid fees owing to such Rejecting Lender, any such assignment to be effective
as of the current Termination Date or (y) effective as of the current
Termination Date, pay to such Rejecting Lender the aggregate principal balance
of Loans then outstanding and owing to such Rejecting Lender plus any
accrued but unpaid interest thereon and accrued but unpaid fees owing to such
Rejecting Lender, together with all amounts, if any, payable under Section 5.4.,
whereupon such Rejecting Lender’s Commitment shall terminate.  Each of the Agent, the Borrower and the
Rejecting Lender shall reasonably cooperate in effectuating the replacement of
such Rejecting Lender under this Section, provided, however, that neither the
Agent, such Rejecting Lender, nor any other Lender shall be obligated in any
way whatsoever to initiate any such replacement or to assist in finding an
Assignee.  If the Borrower has elected to
cause all Rejecting Lenders either to assign their Commitments to Eligible
Assignees as contemplated by the preceding clause (x) or to be paid the amounts
specified in the preceding clause (y), then the Borrower’s request for an
extension which was initially rejected shall be deemed to have been granted and
accordingly the Termination Date shall be extended by one single year,
otherwise the Termination Date shall not be extended.

 

Section 2.14.  Amount Limitations.

 

Notwithstanding any other term of this Agreement or any other Loan
Document, (a) no Lender shall be required to make any Loan if, immediately
after the making of such Loan the aggregate principal amount of all outstanding
Loans, would exceed either (i) the aggregate amount of the Commitments or (ii) the
Maximum Loan Availability and (b) the aggregate principal amount of all
outstanding Bid Rate Loans shall not exceed one-half of the aggregate amount of
all Commitments at such time.

 

40

 

Section 2.15.  Increase in Commitments.

 

The Borrower shall have the right to request
increases in the aggregate amount of the Commitments by providing written
notice to the Agent, which notice shall be irrevocable once given; provided,
however, that after giving effect to any such increases the aggregate amount of
the Commitments shall not exceed $400,000,000. 
Each such increase in the Commitments must be an aggregate minimum
amount of $5,000,000 and integral
multiples of $1,000,000 in excess
thereof.  The Agent shall promptly notify
each Lender of any such request.  No
Lender shall be obligated in any way whatsoever to increase its
Commitment.  If a new Lender becomes a
party to this Agreement, or if any existing Lender agrees to increase its
Commitment, such Lender shall on the date it becomes a Lender hereunder (or in
the case of an existing Lender, increases its Commitment) (and as a condition
thereto) purchase from the other Lenders its Commitment Percentage (determined
with respect to the Lenders’ relative Commitments and after giving effect to the
increase of Commitments) of any outstanding Loans, by making available to the
Agent for the account of such other Lenders, in same day funds, an amount equal
to the sum of (A) the portion of the outstanding principal amount of such
Loans to be purchased by such Lender plus (B) interest accrued and unpaid
to and as of such date on such portion of the outstanding principal amount of
such Loans.  The Borrower shall pay to
the Lenders amounts payable, if any, to such Lenders under Section 5.4. as
a result of the prepayment of any such Loans. 
No increase of the Commitments may be effected under this Section (x) unless
no Default or Event of Default will be in existence on the effective date of
such increase, (y) unless the Borrower can demonstrate to the reasonable
satisfaction of the Agent that, after giving effect to such increase, the
Borrower will be in compliance with Section 10.1. and (z) if any
representation or warranty made or deemed made by the Borrower or any other
Loan Party in any Loan Document to which such Loan Party is a party is not (or
would not be) true or correct on the effective date of such increase except to
the extent that such representations and warranties expressly relate solely to
an earlier date (in which case such representations and warranties shall have
been true and accurate on and as of such earlier date) and except for changes
in factual circumstances specifically and expressly permitted hereunder.  In connection with any increase in the aggregate
amount of the Commitments pursuant to this Section (a) any Lender
becoming a party hereto shall execute such documents and agreements as the
Agent may reasonably request and (b) the Borrower shall make appropriate
arrangements so that each new Lender, and any existing Lender increasing its
Commitment, receives a new or replacement Note, as appropriate, in the amount
of such Lender’s Commitment at the time of the effectiveness of the applicable
increase in the aggregate amount of Commitments.

 

ARTICLE III. PAYMENTS, FEES AND OTHER
GENERAL PROVISIONS

 

Section 3.1. 
Payments.

 

Except to the extent otherwise provided
herein, all payments of principal, interest and other amounts to be made by the
Borrower under this Agreement or any other Loan Document shall be made in
Dollars, in immediately available funds, without deduction, set-off or
counterclaim, to the Agent, not later than 11:00 a.m. San Francisco time
on the date on which such payment shall become due (each such payment made
after such time on such due date to be deemed to have been made on the next
succeeding Business Day).  The Borrower
shall, at the time of making each payment under this Agreement or any Note,
specify to the Agent the 

 

41

 

amounts payable by the Borrower hereunder to which such payment is to
be applied.  Each payment received by the
Agent for the account of a Lender under this Agreement or any Note of such
Lender shall be paid to such Lender, by wire transfer of immediately available
funds in accordance with the wiring instructions provided by such Lender to the
Agent from time to time, for the account of such Lender at the applicable
Lending Office of such Lender.  If the
Agent fails to pay such amount to a Lender within one Business Day of receipt
thereof by the Agent, the Agent shall pay interest on such amount until paid at
a rate per annum equal to the Federal Funds Rate from time to time in
effect.  If the due date of any payment
under this Agreement or any other Loan Document would otherwise fall on a day
which is not a Business Day such date shall be extended to the next succeeding
Business Day and interest shall be payable for the period of such extension.

 

Section 3.2. 
Pro Rata Treatment.

 

Except to the extent otherwise provided
herein:  (a) each borrowing from Lenders
under Section 2.1.(a) shall be made from the Lenders, each payment of
the fees under Sections 3.6.(a) and 3.6.(b) shall be made for the
account of the Lenders, and each termination or reduction of the amount of the
Commitments under Section 2.12. or otherwise
pursuant to this Agreement shall be applied to the respective Commitments of
the Lenders, pro rata according to the amounts of their respective Commitments;
(b) each payment or prepayment of principal of Revolving Loans by the
Borrower shall be made for the account of the Lenders pro rata in accordance
with the respective unpaid principal amounts of the Revolving Loans held by
them, provided that if immediately prior to giving effect to any such payment
in respect of any Revolving Loans the outstanding principal amount of the
Revolving Loans shall not be held by the Lenders pro rata in accordance with
their respective Commitments in effect at the time such Loans were made, then
such payment shall be applied to the Revolving Loans in such manner as shall
result, as nearly as is practicable, in the outstanding principal amount of the
Revolving Loans being held by the Lenders pro rata in accordance with their
respective Commitments; (c) each payment of interest on Revolving Loans by
the Borrower shall be made for the account of the Lenders pro rata in
accordance with the amounts of interest on such Loans then due and payable to
the respective Lenders; (d) the Conversion and Continuation of Revolving
Loans of a particular Type (other than Conversions provided for by Section 5.5.)
shall be made pro rata among the Lenders according to the amounts of their
respective Revolving Loans and the then current Interest Period for each Lender’s
portion of each Revolving Loan of such Type shall be coterminous; (e) each
prepayment of principal of Bid Rate Loans by the Borrower pursuant to Section 2.7.(b)(iii) shall
be made for account of the Lenders then owed Bid Rate Loans pro rata in
accordance with the respective unpaid principal amounts of the Bid Rate Loans
then owing to each such Lender; and (f) the Lenders’ participation in, and
payment obligations in respect of, Swingline Loans under Section 2.3.(e),
shall be in accordance with their respective Pro Rata Shares.  All payments of principal, interest, fees and
other amounts in respect of the Swingline Loans shall be for the account of the
Swingline Lender only (except to the extent any Lender shall have acquired a
participating interest in any such Swingline Loan pursuant to Section 2.3.(e)).

 

42

 

Section 3.3.  Sharing of Payments, Etc.

 

The Borrower agrees that, in addition to any
rights now or hereafter granted under Applicable Law and not by way of
limitation of any such rights, the Agent, each Lender and each Participant is
hereby authorized by the Borrower, at any time or from time to time while an
Event of Default exists, without notice to the Borrower or to any other Person,
any such notice being hereby expressly waived, but in the case of a Lender or a
Participant subject to receipt of the prior written consent of the Agent
exercised in its sole discretion, to set off and to appropriate and to apply
any and all deposits (general or special, including, but not limited to,
indebtedness evidenced by certificates of deposit, whether matured or
unmatured) and any other indebtedness at any time held or owing by the Agent,
such Lender or any affiliate of the Agent or such Lender, to or for the credit
or the account of the Borrower against and on account of any of the Obligations,
irrespective of whether or not any or all of the Loans and all other
Obligations have been declared to be, or have otherwise become, due and payable
as permitted by Section 11.2., and although such obligations shall be
contingent or unmatured.  If a Lender
shall obtain payment of any principal of, or interest on, any Loan under this
Agreement or shall obtain payment on any other Obligation owing by the Borrower
or any other Loan Party through the exercise of any right of set-off, banker’s
lien or counterclaim or similar right or otherwise or through voluntary
prepayments directly to a Lender or other payments made by the Borrower or any
other Loan Party to a Lender not in accordance with the terms of this Agreement
and such payment should be distributed to the Lenders in accordance with Section 3.2.
or Section 11.5., such Lender shall promptly purchase from such other
Lenders participations in (or, if and to the extent specified by such Lender,
direct interests in) the Loans made by the other Lenders or other Obligations
owed to such other Lenders in such amounts, and make such other adjustments
from time to time as shall be equitable, to the end that all the Lenders shall
share the benefit of such payment (net of any reasonable expenses which may actually
be incurred by such Lender in obtaining or preserving such benefit) in
accordance with the requirements of Section 3.2. or Section 11.5., as
applicable.  To such end, all the Lenders
shall make appropriate adjustments among themselves (by the resale of
participations sold or otherwise) if such payment is rescinded or must
otherwise be restored.  The Borrower
agrees that any Lender so purchasing a participation (or direct interest) in
the Loans or other Obligations owed to such other Lenders may exercise all
rights of set-off, banker’s lien, counterclaim or similar rights with the
respect to such participation as fully as if such Lender were a direct holder
of Loans in the amount of such participation. 
Nothing contained herein shall require any Lender to exercise any such
right or shall affect the right of any Lender to exercise and retain the
benefits of exercising, any such right with respect to any other indebtedness
or obligation of the Borrower.

 

Section 3.4.  Several Obligations.

 

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

 

43

 

Section 3.5.  Minimum Amounts.

 

(a)           Borrowings.  Each borrowing of Base Rate Loans shall be in
an aggregate minimum amount of $500,000 and
integral multiples of $100,000 in
excess thereof.  Each borrowing of and
Continuation of, and each Conversion of Base Rate Loans into, LIBOR Loans shall
be in an aggregate minimum amount of $500,000 and integral multiples of $100,000 in excess of that amount.

 

(b)           Prepayments.  Each voluntary prepayment of Revolving Loans
shall be in an aggregate minimum amount of $1,000,000 and integral multiples of $100,000 in excess thereof.

 

(c)           Reductions
of Commitments.  Each reduction of
the Commitments under Section 2.12. shall be in an aggregate minimum
amount of $10,000,000 and integral
multiples of $1,000,000 in excess
thereof.

 

Section 3.6.  Fees.

 

(a)           Closing
Fee.  On the Closing Date, the
Borrower agrees to pay to the Agent and each Lender all loan fees as have been
agreed to in writing by the Borrower and the Agent or each Lender, as
applicable.

 

(b)           Facility
Fees. During the period from the Effective Date to but excluding the
Termination Date, the Borrower agrees to pay to the Agent for the account of
the Lenders a facility fee equal to the daily aggregate amount of the
Commitments (whether or not utilized) times a rate per annum equal to the
Applicable Facility Fee.  Such fee shall
be payable quarterly in arrears on the first day of each January, April, July and
October during the term of this Agreement and on the Termination Date and
will be based on the Applicable Facility Fee corresponding to the Borrower’s
Credit Rating as of the last day of the previous fiscal quarter (determined in
accordance with procedure set forth in the definition of Applicable
Margin).  The Borrower acknowledges that
the fee payable hereunder is a bona fide commitment fee and is intended as
reasonable compensation to the Lenders for committing to make funds available
to the Borrower as described herein and for no other purposes.

 

(c)           Bid
Rate Loan Fees.  The Borrower agrees
to pay to the Agent such fees for services rendered by the Agent in connection
with the Bid Rate Loans as shall be separately agreed upon between the Borrower
and the Agent.

 

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

 

(e)           Extension
Fee.  If, pursuant to Section 2.13.,
the Borrower exercises its right to extend the Termination Date, the Borrower
agrees to pay to the Agent for the account of each Lender so extending an
extension fee equal to (i) in the case of a Lender with a Commitment equal
to or greater than $30,000,000, 0.20% of the amount of such Lender’s Commitment
at such time and (ii) in the case of a Lender with a Commitment less than
$30,000,000, 0.15% of the amount of such Lender’s Commitment at such time.  Such fee shall be paid to the Agent prior to,
and as a condition to, such extension but shall be promptly reimbursed to the
Borrower if such

 

44

 

extension is not approved by the Requisite Lenders in accordance with Section 2.13.  Notwithstanding the foregoing, in no event
shall the Borrower be required to pay any extension fee to a Rejecting Lender.

 

Section 3.7.  Computations.

 

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

 

Section 3.8.  Usury.

 

In no event shall the amount of interest due
or payable on the Loans or other Obligations exceed the maximum rate of
interest allowed by Applicable Law and, if any such payment is paid by the
Borrower or received by any Lender, then such excess sum shall be credited as a
payment of principal, unless the Borrower shall notify the respective Lender in
writing that the Borrower elects to have such excess sum returned to it
forthwith.  It is the express intent of
the parties hereto that the Borrower not pay and the Lenders not receive,
directly or indirectly, in any manner whatsoever, interest in excess of that
which may be lawfully paid by the Borrower under Applicable Law.  The parties hereto hereby agree and stipulate
that the only charge imposed upon the Borrower for the use of money in connection
with this Agreement is and shall be the interest specifically described in Section 2.4.(a)(i).
- (iv). and with respect to Swingline Loans, in Section 2.3.(c).  Notwithstanding the foregoing, the parties
hereto further agree and stipulate that all agency fees, syndication fees,
facility fees, letter of credit fees, underwriting fees, default charges, late
charges, funding or “breakage” charges, increased cost charges, attorneys’ fees
and reimbursement for costs and expenses paid by the Agent or any Lender to
third parties or for damages incurred by the Agent or any Lender, are charges
made to compensate the Agent or any such Lender for underwriting or
administrative services and costs or losses performed or incurred, and to be
performed or incurred, by the Agent and the Lenders in connection with this
Agreement and shall under no circumstances be deemed to be charges for the use
of money.  All charges other than charges
for the use of money shall be fully earned and nonrefundable when due.

 

Section 3.9.  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 Agreement and the other Loan Documents, and such
account rendered by the Agent shall be deemed conclusive upon the Borrower absent
manifest error.  The failure of the Agent
to deliver such a statement of accounts shall not relieve or discharge the
Borrower from any of its obligations hereunder.

 

Section 3.10.  Defaulting Lenders.

 

If for any reason any Lender
(a “Defaulting Lender”) shall fail or refuse to perform any of its obligations
under this Agreement or any other Loan Document to which it is a party within
the time period specified for performance of such obligation or, if no time
period is specified, if such failure or refusal continues for a period of 5
Business Days after notice from the Agent,

 

45

 

then, in addition to the rights and
remedies that may be available to the Agent or the Borrower under this
Agreement or Applicable Law, such Defaulting Lender’s right to participate in
the administration of the Loans, this Agreement and the other Loan Documents,
including without limitation, any right to vote in respect of, to consent to or
to direct any action or inaction of the Agent or to be taken into account in
the calculation of Requisite Lenders, shall be suspended during the pendency of
such failure or refusal.  If for any
reason a Lender fails to make timely payment to the Agent of any amount
required to be paid to the Agent hereunder (without giving effect to any notice
or cure periods), in addition to other rights and remedies which the Agent or
the Borrower may have under the immediately preceding provisions or otherwise,
the Agent shall be entitled (i) to collect interest from such Defaulting
Lender on such delinquent payment for the period from the date on which the
payment was due until the date on which the payment is made at the Federal
Funds Rate, (ii) to withhold or setoff and to apply in satisfaction of the
defaulted payment and any related interest, any amounts otherwise payable to
such Defaulting Lender under this Agreement or any other Loan Document and (iii) to
bring an action or suit against such Defaulting Lender in a court of competent
jurisdiction to recover the defaulted amount and any related interest.  Any amounts received by the Agent in respect
of a Defaulting Lender’s Loans shall not be paid to such Defaulting Lender and
shall be held by the Agent and paid to such Defaulting Lender upon the
Defaulting Lender’s curing of its default.

 

Section 3.11.  Taxes.

 

(a)           Taxes
Generally.  All payments to any
Lender by the Borrower of principal of, and interest on, the Loans and all
other Obligations shall be made free and clear of and without deduction for any
present or future excise, stamp or other taxes, fees, duties, levies, imposts,
charges, deductions, withholdings or other charges of any nature whatsoever
imposed by any taxing authority, but excluding (i) franchise taxes, (ii) any
taxes (other than withholding taxes) that would not be imposed but for a
connection between the Agent or a Lender and the jurisdiction imposing such
taxes (other than a connection arising solely by virtue of the activities of
the Agent or such Lender pursuant to or in respect of this Agreement or any
other Loan Document), (iii) any taxes imposed on or measured by any Lender’s
assets, net income, receipts or branch profits; (iv) any taxes to the
extent that they are in effect and would apply to the Agent or Lender
immediately prior to the Agreement Date or as of the date such Person becomes a
Lender in the case of an Eligible Assignee pursuant to Section 13.6.; and (v) any
taxes arising after the Agreement Date solely as a result of or attributable to
a Lender changing its designated Lending Office after the date such Lender
becomes a party hereto (such non-excluded items being collectively called “Taxes”).  If any withholding or deduction from any
payment to be made by the Borrower hereunder is required in respect of any
Taxes pursuant to any Applicable Law, then the Borrower will:

 

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

 

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

 

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

 

46

 

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

 

(c)           Tax
Forms. Prior to the date that any Lender or Participant organized under the
laws of a jurisdiction outside the United States of America becomes a party
hereto, such Person shall deliver to the Borrower and the Agent such
certificates, documents or other evidence, as required by the Internal Revenue
Code or Treasury Regulations issued pursuant thereto (including Internal
Revenue Service Forms W-8ECI and W-8BEN,
as applicable, or appropriate successor forms or such other evidence
satisfactory to the Agent and the Borrower), properly completed, currently
effective and duly executed by such Lender or Participant establishing that
payments to it hereunder and under the Notes are (i)not subject to United
States Federal backup withholding tax and (ii) not subject to United
States Federal withholding tax under the Internal Revenue Code.  Each such Lender or Participant shall
(x) deliver further copies of such forms or other appropriate
certifications on or before the date that any such forms expire or become
obsolete and after the occurrence of any event requiring a change in the most
recent form delivered to the Borrower and (y) obtain such extensions of
the time for filing, and renew such forms and certifications thereof, as may be
reasonably requested by the Borrower or the Agent.  The Borrower shall not be required to pay any
amount pursuant to last sentence of subsection (a) above or pursuant
to section (b) above to any Lender or Participant that is organized
under the laws of a jurisdiction outside of the United States of America or the
Agent, if it is organized under the laws of a jurisdiction outside of the
United States of America, if such Lender, Participant or the Agent, as
applicable, fails to comply with the requirements of this subsection.  If any such Lender or Participant fails to
deliver the above forms or other documentation, then the Agent may withhold
from such payment to such Lender such amounts as are required by the Internal
Revenue Code. Upon the request of the Agent, each Lender that is a “United
States person” within the meaning of Section 7701(a)(30) of the Code shall
deliver to the Agent two duly signed completed copies of IRS Form W-9.  If such Lender fails to deliver such forms,
then the Agent may withhold from any interest payment to such Lender an amount
equivalent to the applicable backup withholding tax imposed by the Code,
without reduction, and the Borrower shall not be required to pay any amount
pursuant to Section 3.11.(a) or (b). 
If any Governmental Authority asserts that the Agent did not properly
withhold or backup withhold, as the case may be, any tax or other amount from
payments made to or for the account of any Lender, such Lender shall indemnify
the Agent therefor, including all penalties and interest, any taxes imposed by
any jurisdiction on the amounts payable to the Agent under this Section, and
costs and expenses (including all fees and disbursements of any law firm or
other external counsel and the allocated cost of internal legal services and
all disbursements of internal counsel) of the Agent.  The obligation of the Lenders under this Section shall
survive the termination of the Commitments, repayment of all Obligations and the
resignation or replacement of the Agent.

 

47

 

(d)           If
the Borrower determines in good faith that a reasonable basis exists for
contesting any Taxes for which indemnification has been demanded hereunder, the
relevant Lender or the Agent, as applicable, shall cooperate with the Borrower
in challenging such Taxes at the Borrower’s expense if so requested by the
Borrower in writing.  If any Lender or
the Agent, as applicable, receives a refund of a Tax for which a payment has
been made by the Borrower pursuant to this Section 3.11.(d), which refund
is attributable to such payment made by the Borrower, then the Lender or the
Agent, as the case may be, shall reimburse the Borrower for such.  Nothing herein contained shall interfere with
the right of a Lender or the Agent to arrange its tax affairs in whatever
manner it thinks fit nor oblige any Lender or the Agent to disclose any
information relating to its tax affairs or any computations in respect thereof
or require any Lender or the Agent to do anything that would prejudice its
ability to benefit from any other reliefs, remissions or repayments to which it
may be entitled.

 

ARTICLE IV.  UNENCUMBERED POOL PROPERTIES

 

Section 4.1.  Eligibility of Properties.

 

(a)           Existing
Unencumbered Pool Properties. 
Subject to compliance with the terms and conditions of Section 6.1.(a),
as of the Agreement Date the parties hereto acknowledge and agree that the
Properties listed on Schedule 4.1. are Unencumbered Pool Properties as of March 31,
2005.  On the Effective Date, the
Borrower shall deliver an updated Schedule 4.1. in form and substance
acceptable to the Agent and Lenders.

 

(b)           Additional
Unencumbered Pool Properties.  After
the Effective Date, an Eligible Property shall be included as Unencumbered Pool
Property upon delivery to the Agent of an Unencumbered Pool Certificate
pursuant to Section 9.4.(d). setting forth the information required to be
contained therein and assuming that such Eligible Property is included as an Unencumbered
Pool Property.  Subject to the terms and
conditions of this Agreement, upon the Agent’s receipt of such certificate,
such Eligible Property shall be included as an Unencumbered Pool Property.

 

(c)           Alternative
Acceptance Procedure for Additional Unencumbered Pool Properties.  Any Property that does not satisfy all of the
requirements of an Eligible Property shall be included only upon the written
approval of the Requisite Lenders provided, however, that such approval shall
only be a waiver of those requirements in the definition of Eligible Property
specifically set forth and approved therein with respect to such Property.

 

Section 4.2.  Termination of Designation as Unencumbered
Pool Property.

 

A Property shall cease to be included as an Unencumbered Pool Property
for purposes of this Agreement if either (i) such Unencumbered Pool
Property ceases to be an Eligible Property (with the termination effective
immediately) or (ii) such Property is not included in an Unencumbered Pool
Certificate subsequently submitted pursuant to this Agreement (with the
termination effective as of the date of receipt by the Agent of such
Unencumbered Pool Certificate). 
Notwithstanding the foregoing, no Property will be terminated as an
Unencumbered Pool Property if (i) a Default or Event of Default exists or (ii) a
Default or Event of Default would exist immediately after such Property is
terminated as an Unencumbered Pool Property.

 

48

 

ARTICLE V. YIELD PROTECTION, ETC.

 

Section 5.1.  Additional Costs; Capital Adequacy.

 

(a)           Additional Costs. 
The Borrower shall promptly pay to the Agent for the account of a Lender
from time to time such amounts as such Lender may determine to be necessary to
compensate such Lender for any costs incurred by such Lender that it reasonably
determines are attributable to its making or maintaining of any LIBOR Loans or
its obligation to make any LIBOR Loans hereunder, any reduction in any amount
receivable by such Lender under this Agreement or any of the other Loan
Documents in respect of any of such LIBOR Loans or such obligation or the
maintenance by such Lender of capital in respect of its LIBOR Loans or its
Commitment (such increases in costs and reductions in amounts receivable being
herein called “Additional Costs”), resulting from any Regulatory Change
that:  (i) changes the basis of
taxation of any amounts payable to such Lender under this Agreement or any of
the other Loan Documents in respect of any of such LIBOR Loans or its
Commitment (other than taxes imposed on or measured by the overall net income
of such Lender or of its Lending Office for any of such LIBOR Loans by the
jurisdiction in which such Lender has its principal office or such Lending
Office), or (ii) imposes or modifies any reserve, special deposit or
similar requirements (including without limitation, Regulation D of the
Board of Governors of the Federal Reserve System or other similar reserve
requirement applicable to any other category of liabilities or category of extensions
of credit or other assets by reference to which the interest rate on LIBOR
Loans is determined) relating to any extensions of credit or other assets of,
or any deposits with or other liabilities of, or other credit extended by, or
any other acquisition of funds by such Lender (or its parent corporation), or
any commitment of such Lender (including, without limitation, the Commitment of
such Lender hereunder) or (iii) has or would have the effect of reducing
the rate of return on capital of such Lender to a level below that which such
Lender could have achieved but for such Regulatory Change (taking into
consideration such Lender’s policies with respect to capital adequacy).

 

(b)           Lender’s Suspension of LIBOR Loans. 
Without limiting the effect of the provisions of the immediately
preceding subsection (a), if by reason of any Regulatory Change, any
Lender either (i) incurs Additional Costs based on or measured by the
excess above a specified level of the amount of a category of deposits or other
liabilities of such Lender that includes deposits by reference to which the
interest rate on LIBOR Loans is determined as provided in this Agreement or a
category of extensions of credit or other assets of such Lender that includes
LIBOR Loans or (ii) becomes subject to restrictions on the amount of such
a category of liabilities or assets that it may hold, then, if such Lender so
elects by notice to the Borrower (with a copy to the Agent), the obligation of
such Lender to make or Continue, or to Convert Base Rate Loans into, LIBOR
Loans hereunder shall be suspended until such Regulatory Change ceases to be in
effect (in which case the provision of Section 5.5. shall apply).

 

49

 

(c)           Notification and Determination of Additional
Costs.  Each of the Agent and each Lender, as the case
may be, agrees to notify the Borrower of any event occurring after the
Agreement Date entitling the Agent or such Lender to compensation under any of
the preceding subsections of this Section as promptly as practicable;
provided, however, that the failure of the Agent or any Lender to give such
notice shall not release the Borrower from any of its obligations
hereunder.  The Agent and each Lender, as
the case may be, agrees to furnish to the Borrower (and in the case of a Lender
to the Agent as well) a certificate setting forth the basis and amount of each
request for compensation under this Section. 
Determinations by the Agent or such Lender, as the case may be, of the
effect of any Regulatory Change shall be conclusive, provided that such
determinations are made on a reasonable basis and in good faith.

 

Section 5.2.  Suspension of LIBOR Loans.

 

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

 

(a)           the
Agent reasonably determines (which determination shall be conclusive) that
quotations of interest rates for the relevant deposits referred to in the
definition of LIBOR are not being provided in the relevant amounts or for the
relevant maturities for purposes of determining rates of interest for LIBOR
Loans as provided herein or is otherwise unable to determine LIBOR, or

 

(b)           the
Agent reasonably determines (which determination shall be conclusive) that the
relevant rates of interest referred to in the definition of LIBOR upon the
basis of which the rate of interest for LIBOR Loans for such Interest Period is
to be determined are not likely to adequately cover the cost to any Lender of
making or maintaining LIBOR Loans for such Interest Period;

 

(c)           any
Lender that has outstanding a Bid Rate Quote with respect to a LIBOR Margin
Loan reasonably determines (which determination shall be conclusive) that LIBOR
will not adequately and fairly reflect the cost to such Lender of making or
maintaining such LIBOR Margin Loan;

 

then the Agent shall give the Borrower and each Lender prompt notice
thereof and, so long as such condition remains in effect, (i) the Lenders
shall be under no obligation to, and shall not, make additional LIBOR Loans,
Continue LIBOR Loans or Convert Loans into LIBOR Loans and the Borrower shall,
on the last day of each current Interest Period for each outstanding LIBOR
Loan, either prepay such Loan or Convert such Loan into a Base Rate Loan and (ii) in
the case of clause (c) above, no Lender that has outstanding a Bid Rate
Quote with respect to a LIBOR Margin Loan shall be under any obligation to make
such Loan.

 

Section 5.3.  Illegality.

 

Notwithstanding any other
provision of this Agreement, if any Lender shall determine (which determination
shall be conclusive and binding) that it is unlawful for such Lender to honor
its obligation to make or maintain LIBOR Loans hereunder, then such Lender
shall promptly notify the Borrower thereof (with a copy of such notice to the
Agent) and such

 

50

 

Lender’s
obligation to make or Continue, or to Convert Revolving Loans of any other Type
into, LIBOR Loans shall be suspended until such time as such Lender may again
make and maintain LIBOR Loans (in which case the provisions of Section 5.5.
shall be applicable).

 

Section 5.4.  Compensation.

 

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

 

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

 

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

 

Not in limitation of the foregoing, such compensation shall include,
without limitation; (i) in the case of a LIBOR Loan, an amount equal to
the then present value of (A) the amount of interest that would have accrued
on such LIBOR Loan for the remainder of the Interest Period at the rate
applicable to such LIBOR Loan, less (B) the amount of interest that would
accrue on the same LIBOR Loan for the same period if LIBOR were set on the date
on which such LIBOR Loan was repaid, prepaid or Converted or the date on which
the Borrower failed to borrow, Convert or Continue such LIBOR Loan, as
applicable, calculating present value by using as a discount rate LIBOR quoted
on such date and (ii) in the case of a Bid Rate Loan, the sum of such
losses and expenses as the Lender or Designated Lender who made such Bid Rate
Loan may reasonably incur by reason of such prepayment, including without
limitation any losses or expenses incurred in obtaining, liquidating or
employing deposits from third parties.  
Upon Borrower’s request, the Agent will provide to the Borrower, on
behalf of any Lender seeking compensation under this Section, a statement
setting forth in reasonable detail the basis for requesting such compensation
and the method for determining the amount thereof.  Any such statement shall be conclusive absent
manifest error.

 

Section 5.5.
 Treatment of
Affected Loans.

 

If the obligation
of any Lender to make LIBOR Loans or to Continue, or to Convert Base Rate Loans
into, LIBOR Loans shall be suspended pursuant to Section 5.1.(b), 5.2. or
5.3. then such Lender’s LIBOR Loans shall be automatically Converted into Base
Rate Loans on the last day(s) of the then current Interest Period(s) for LIBOR
Loans (or, in the case of a Conversion required by Section 5.1.(b) or
5.2. 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 5.1.(b), 5.2. or 5.3.
that gave rise to such Conversion no longer exist:

 

51

 

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

 

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

 

If such Lender gives
notice to the Borrower (with a copy to the Agent) that the circumstances
specified in Section 5.1. or 5.3. that gave rise to the Conversion of such
Lender’s LIBOR Loans pursuant to this Section no longer exist (which such
Lender agrees to do promptly upon such circumstances ceasing to exist) at a
time when LIBOR Loans made by other Lenders are outstanding, then such Lender’s
Base Rate Loans shall be automatically Converted, on the first day(s) of the
next succeeding Interest Period(s) for such outstanding LIBOR Loans, to the
extent necessary so that, after giving effect thereto, all Loans held by the
Lenders holding LIBOR Loans and by such Lender are held pro rata (as to
principal amounts, Types and Interest Periods) in accordance with their
respective Commitments.

 

Section 5.6.  Change of Lending Office.

 

Each Lender agrees that it will use
reasonable efforts (consistent with its internal policy and legal and
regulatory restrictions) to designate an alternate Lending Office or take other
measures with respect to any of its Loans affected by the matters or
circumstances described in Sections 3.11., 5.1. or 5.3. to reduce the liability
of the Borrower or avoid the results provided thereunder, so long as such
designation is not disadvantageous to such Lender as determined by such Lender
in its sole discretion, except that such Lender shall have no obligation to
designate a Lending Office located in the United States of America.

 

Section 5.7.  Affected Lenders.

 

If (a) a Lender requests compensation
pursuant to Section 3.11. or 5.1., and the Requisite Lenders are not also
doing the same, or (b) the obligation of any Lender to make LIBOR Loans or
to Continue, or to Convert Base Rate Loans into LIBOR Loans shall be suspended
pursuant to Section 5.1., 5.2. or 5.3. but the obligation of the Requisite
Lenders shall not have been suspended under such Sections, then, so long as
there does not then exist any Default or Event of Default, the Borrower may
either (i) demand that such Lender (the “Affected Lender”), and upon such
demand the Affected Lender shall promptly assign its Commitments to an Eligible
Assignee subject to and in accordance with the provisions of Section 13.6.(c) for
a purchase price equal to the aggregate principal balance of Loans then owing
to the Affected Lender plus any accrued but unpaid interest thereon and accrued
but unpaid fees owing to the Affected Lender or (ii) pay to the Affected
Lender the aggregate principal balance of the Loans then owing to the Affected
Lender plus any accrued but unpaid interest thereon and accrued but unpaid fees
owing to the Affected Lender, whereupon the Affected Lender shall no longer be
a party hereto or have any rights or obligations hereunder or under any of the
other Loan Documents.  Each of the Agent,
the Borrower and the Affected Lender shall reasonably

 

52

 

cooperate in effectuating the replacement of such Affected Lender under
this Section, but at no time shall the Agent, such Affected Lender nor any
other Lender be obligated in any way whatsoever to initiate any such
replacement or to assist in finding an Eligible Assignee.  The exercise by the Borrower of its rights
under this Section shall be at the Borrower’s sole cost and expenses and
at no cost or expense to the Agent, the Affected Lender or any of the other
Lenders; provided, however, the Borrower shall not be obligated to reimburse or
otherwise pay an Affected Lender’s administrative or legal costs incurred as a
result of the Borrower’s exercise of its rights under this Section.  The terms of this Section shall not in
any way limit the Borrower’s obligation to pay to any Affected Lender
compensation owing to such Affected Lender pursuant to Section 3.11. or
5.1.

 

Section 5.8.  Assumptions Concerning Funding of LIBOR
Loans.

 

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

 

ARTICLE VI. CONDITIONS PRECEDENT

 

Section 6.1.  Initial Conditions Precedent.

 

The Closing Date will occur upon satisfaction
or waiver of the following conditions precedent:

 

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

 

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

 

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

 

(iii)          the
Guaranty executed by each of the Guarantors initially to be a party thereto;

 

(iv)          (A) an
opinion of Latham & Watkins LLP, counsel to the Borrower and the
Guarantors, addressed to the Agent and the Lenders and covering the matters set
forth in Exhibit N-1, (B) an opinion of Venable LLP, special Maryland
counsel to the Borrower, addressed to the Agent and the Lenders and covering
the matters set forth in Exhibit N-2, and (C) an opinion of the
Borrower’s general counsel addressed to the Agent and the Lenders and covering
the matters set forth in Exhibit N-3;

 

53

 

(v)           the
certificate or articles of incorporation, articles of organization, certificate
of limited partnership, declaration of trust or other comparable organizational
instrument (if any) of each Loan Party certified as of a recent date by the
Secretary of State of the state of formation of such Person;

 

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

 

(vii)         a
certificate of incumbency signed by the Secretary or Assistant Secretary (or
other individual performing similar functions) of each Loan Party with respect
to each of the officers of such Person authorized to execute and deliver the
Loan Documents to which such Person is a party, and in the case of the
Borrower, authorized to execute and deliver on behalf of the Borrower Notices of
Borrowing, Notices of Swingline Borrowing, Notices of Conversion and Notices of
Continuation;

 

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

 

(ix)           an
Unencumbered Pool Certificate calculated as of March 31, 2005;

 

(x)            a
Compliance Certificate calculated on a pro forma basis for the Borrower’s
fiscal quarter ending March 31,
2005;

 

(xi)           a
Closing Certificate substantially in form of Exhibit R, executed on behalf
of the Borrower by an authorized officer of the Borrower;

 

(xii)          evidence
satisfactory to the Agent that the Fees, if any, then due and payable under Section 3.6.,
together with all other fees, expenses and reimbursement amounts due and
payable to the Agent and any of the Lenders, including without limitation, the
fees and expenses of counsel to the Agent, have been paid; and

 

(xiii)         such
other documents and instruments as the Agent, or any Lender through the Agent,
may reasonably request; and

 

54

 

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

 

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

 

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

 

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

 

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

 

Section 6.2.  Conditions Precedent to All Loans.

 

The obligations of Lenders to make any Loans
are subject to the further conditions precedent that: (a) no Default or
Event of Default shall exist as of the date of the making of such Loan or would
exist immediately after giving effect thereto, and none of the conditions
described in Section 2.14. would exist after giving effect thereto; (b) the
representations and warranties made or deemed made by the Borrower and each
other Loan Party in the Loan Documents to which any of them is a party, shall
be true and correct on and as of the date of the making of such Loan with the
same force and effect as if made on and as of such date except to the extent
that such representations and warranties expressly relate solely to an earlier
date (in which case such representations and warranties shall have been true
and accurate on and as of such earlier date) and except for changes in factual
circumstances specifically and expressly permitted hereunder and (c) in
the case of the borrowing of Revolving Loans, the Agent shall have received a
timely Notice of Borrowing, or in the case of a Swingline Loan, the Swingline
Lender shall have received a timely Notice of Swingline Borrowing.  Each Credit Event shall constitute a

 

55

 

certification by the Borrower to the effect set forth in the preceding
sentence (both as of the date of the giving of notice relating to such Credit
Event and, unless the Borrower otherwise notifies the Agent prior to the date
of such Credit Event, as of the date of the occurrence of such Credit
Event).  In addition, the Borrower shall
be deemed to have represented to the Agent and the Lenders at the time such
Loan is made that all conditions to the making of such Loan contained in this Article VI.
have been satisfied.

 

Section 6.3.  Conditions as Covenants.

 

If the Lenders permit the making of any
Loans, prior to the satisfaction of all conditions precedent set forth in
Sections 6.1. and 6.2., the Borrower shall nevertheless cause such
condition or conditions to be satisfied within 5 Business Days after the date
of the making of such Loans.  Unless set
forth in writing to the contrary, the making of its initial Loan by a Lender
shall constitute a confirmation by such Lender to the Agent and the other
Lenders that insofar as such Lender is concerned the Borrower has satisfied the
conditions precedent for initial Loans set forth in Sections 6.1. and 6.2.

 

ARTICLE VII. REPRESENTATIONS AND
WARRANTIES

 

Section 7.1.  Representations and Warranties.

 

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

 

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

 

(b)           Ownership
Structure.  Part I of Schedule 7.1.(b) is,
as of March 31, 2005, a complete and correct list of all Subsidiaries of
the Borrower setting forth for each such Subsidiary, (i) the jurisdiction
of organization of such Person, (ii) each Person holding any Equity
Interest in such Person, (iii) the nature of the Equity Interests held by
each such Person and (iv) the percentage of ownership of such Person
represented by such Equity Interests. 
Except as disclosed in such Schedule (A) each of the Borrower
and its Subsidiaries owns, free and clear of all Liens, and has the
unencumbered right to vote, all outstanding Equity Interests in each Person
shown to be held by it on such Schedule, (B) all of the issued and
outstanding capital stock of each such Person organized as a corporation is
validly issued, fully paid and nonassessable and (C) there are no
outstanding subscriptions, options, warrants, commitments, preemptive rights or
agreements of any kind (including, without limitation, any stockholders’ or
voting trust agreements) for the issuance, sale, registration or voting of, or
outstanding securities convertible into, any additional shares of capital stock
of any class, or partnership or other

 

56

 

ownership interests of any type in, any such Person.  Part II of Schedule 7.1.(b) correctly
sets forth, as of the Agreement Date, all Unconsolidated Affiliates of the
Borrower, including the correct legal name of such Person, the type of legal
entity which each such Person is, and all ownership interests in such Person
held directly or indirectly by the Borrower.

 

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

 

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

 

(e)           Compliance
with Law; Governmental Approvals. 
Each Loan Party and each other Subsidiary is in compliance with each
Governmental Approval and all other Applicable Laws relating to it except for
noncompliances which, and Governmental Approvals the failure to possess which,
could not, individually or in the aggregate, reasonably be expected to cause a
Default or Event of Default or have a Material Adverse Effect.

 

(f)            Title
to Properties; Liens.  Schedule 7.1.(f) is,
as of March 31, 2005, a complete and correct listing of all real estate
assets of the Loan Parties and the other Subsidiaries, setting forth, for each
such Property, the current occupancy status of such Property and whether such
Property is a Development Property and, if such Property is a Development
Property, the status of completion of such Property.  Each of the Loan Parties and all other
Subsidiaries has good, marketable and legal title to, or a valid leasehold
interest in, its respective assets.  None
of the Unencumbered Pool Properties is subject to any Lien other than Permitted
Liens.

 

57

 

(g)           Existing
Indebtedness; Total Liabilities.  Part I
of Schedule 7.1.(g) is, as of March 31, 2005, a complete and
correct listing of all Indebtedness (including all Guarantees) of each of the
Loan Parties and the other Subsidiaries, and if such Indebtedness is secured by
any Lien, a description of all of the property subject to such Lien. As of March 31,
2005, the Loan Parties and the other Subsidiaries have performed and are in
compliance with all of the terms of such Indebtedness and all instruments and
agreements relating thereto, and no default or event of default, or event or
condition which with the giving of notice, the lapse of time, or both, would
constitute a default or event of default, exists with respect to any such
Indebtedness.  Part II of Schedule 7.1.(g) is,
as of March 31, 2005, a complete and correct listing of all Total
Liabilities of the Loan Parties and the other Subsidiaries (excluding any
Indebtedness set forth on Part I of such Schedule).

 

(h)           Material
Contracts.  Schedule 7.1.(h) is,
as of the Agreement Date, a true, correct and complete listing of all Material
Contracts.  As of the Agreement Date,
each of the Loan Parties and the other Subsidiaries that are parties to any
Material Contract has performed and is in compliance with all of the terms of
such Material Contract, and no default or event of default, or event or
condition which with the giving of notice, the lapse of time, or both, would
constitute such a default or event of default, exists with respect to any such
Material Contract.

 

(i)            Litigation.  Except as set forth on Schedule 7.1.(i),
there are no actions, suits or proceedings pending (nor, to the knowledge of
any Loan Party, are there any actions, suits or proceedings threatened) against
or in any other way relating adversely to or affecting, any Loan Party, any
other Subsidiary or any of their respective property in any court or before any
arbitrator of any kind or before or by any other Governmental Authority which,
is reasonably likely to be adversely determined, and, if adversely determined,
could reasonably be expected to have a Material Adverse Effect, and there are
no strikes, slow downs, work stoppages or walkouts or other labor disputes
in progress or threatened relating to, any Loan Party or any other Subsidiary.

 

(j)            Taxes.  All federal, state and other tax returns of
each Loan Party and each other Subsidiary required by Applicable Law to be
filed have been duly filed, and all federal, state and other taxes, assessments
and other governmental charges or levies upon, each Loan Party and each other
Subsidiary and their respective properties, income, profits and assets which
are due and payable have been paid, except any such nonpayment or non-filing
which is at the time permitted under Section 8.6.  As of the Agreement Date, none of the United
States income tax returns of any Loan Party or any other Subsidiary is under
audit.  All charges, accruals and
reserves on the books of the Borrower and each of its Subsidiaries in respect
of any taxes or other governmental charges are in accordance with GAAP.

 

(k)           Financial
Statements.  The Borrower has
furnished to each Lender copies of (i) the audited consolidated balance
sheet of the Borrower and its consolidated Subsidiaries for the fiscal years
ended December 31, 2003 and December 31, 2004, and the related
consolidated statements of operations, shareholders’ equity and cash flow for
the fiscal years ended on such dates, with the opinion thereon of KPMG LLP, and
(ii) the unaudited consolidated balance sheet of the Borrower and its
consolidated Subsidiaries for the fiscal quarter ended March 31, 2005, and
the related consolidated statements of operations, shareholders’ equity and
cash flow of the

 

58

 

Borrower and its consolidated Subsidiaries for the two fiscal quarter
period ended on such date.  Such balance
sheets and statements (including in each case related schedules and notes) are
complete and correct in all material respects and present fairly, in accordance
with GAAP consistently applied throughout the periods involved, the
consolidated financial position of the Borrower and its consolidated
Subsidiaries as at their respective dates and the results of operations and the
cash flow for such periods (subject, as to interim statements, to changes
resulting from normal year-end audit adjustments).  Neither the Borrower nor any of its
Subsidiaries has on the Agreement Date any material contingent liabilities,
liabilities, liabilities for taxes, unusual or long-term commitments or
unrealized or forward anticipated losses from any unfavorable commitments,
except as referred to or reflected or provided for in said financial
statements.

 

(l)            No
Material Adverse Change.  Since December 31,
2004, there has been no material adverse change in the consolidated financial
condition, results of operations, business or prospects of the Borrower and its
consolidated Subsidiaries taken as a whole. 
Each of the Borrower, the other Loan Parties and the other Subsidiaries
is Solvent.

 

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

 

(n)           Absence
of Defaults.  None of the Loan
Parties or the other Subsidiaries is in default under its articles of
incorporation, bylaws, partnership agreement or other similar organizational
documents, and no event has occurred, which has not been remedied, cured or
waived:  (i) which constitutes a
Default or an Event of Default; or (ii) which constitutes, or which with
the passage of time, the giving of notice, or both, would constitute, a default
or event of default by, any Loan Party or any other Subsidiary under any agreement
(other than this Agreement) or judgment, decree or order to which any such
Person is a party or by which any such Person or any of its respective
properties may be bound where such default or event of default could,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.

 

(o)           Environmental
Laws.  Except as set forth on Schedule 7.1(o),
each of the Loan Parties and the other Subsidiaries is in compliance with all
applicable Environmental Laws and has obtained all Governmental Approvals which
are required under Environmental Laws and is in compliance with all terms and
conditions of such Governmental Approvals, where with respect to each of the
foregoing the failure to obtain or to comply with could be reasonably

 

59

 

expected to have a Material Adverse Effect.  Except for any of the following matters that
could not be reasonably expected to have a Material Adverse Effect, no Loan
Party is aware of, nor has it received notice of, any past or present events,
conditions, circumstances, activities, practices, incidents, actions, or plans
which, with respect to any Loan Party or any other Subsidiary, may unreasonably
interfere with or prevent compliance or continued compliance with Environmental
Laws, or may give rise to any common-law or legal liability, based on or
related to the manufacture, processing, distribution, use, treatment, storage,
disposal, transport, or handling or the emission, discharge, release or
threatened release into the environment, of any Hazardous Material; and there
is no civil, criminal, or administrative action, suit, demand, claim, hearing,
notice, or demand letter, notice of violation, investigation, or proceeding
pending or, to the Borrower’s knowledge after due inquiry, threatened, against
any Loan Party or any other Subsidiary relating in any way to Environmental
Laws which, if determined adversely to such Loan Party or such other
Subsidiary, could be reasonably expected to have a Material Adverse Effect.

 

(p)           Investment
Company; Public Utility Holding Company. 
No Loan Party, nor any other Subsidiary is (i) an “investment
company” or a company “controlled” by an “investment company” within the
meaning of the Investment Company Act of 1940, as amended, (ii) a “holding
company” or a “subsidiary company” of a “holding company”, or an “affiliate” of
a “holding company” or of a “subsidiary company” of a “holding company”, within
the meaning of the Public Utility Holding Company Act of 1935, as amended, or (iii) subject
to any other Applicable Law which purports to regulate or restrict its ability
to borrow money or obtain other extensions of credit or to consummate the
transactions contemplated by this Agreement or to perform its obligations under
any Loan Document to which it is a party.

 

(q)           Margin
Stock.  No Loan Party nor any other
Subsidiary is engaged principally, or as one of its important activities, in
the business of extending credit for the purpose, whether immediate, incidental
or ultimate, of buying or carrying “margin stock” within the meaning of
Regulation U of the Board of Governors of the Federal Reserve System.

 

(r)            Affiliate
Transactions.  Except as set forth on
Schedule 7.1.(r). and as permitted by Section 10.9., no Loan Party
nor any other Subsidiary is a party to or bound by any agreement or arrangement
(whether oral or written) with any Affiliate.

 

(s)           Intellectual
Property.  Except for such instances
as would not, individually or in the aggregate, have a Material Adverse
Effect:  (1) each of the Loan
Parties and each other Subsidiary owns or has the right to use, under valid
license agreements or otherwise, all patents, licenses, franchises, trademarks,
trademark rights, trade names, trade name rights, trade secrets and copyrights
(collectively, “Intellectual Property”) necessary to the conduct of its
businesses, without known conflict with any patent, license, franchise,
trademark, trade secret, trade name, copyright, or other proprietary right of
any other Person; (2) all such Intellectual Property is fully protected
and/or duly and properly registered, filed or issued in the appropriate office
and jurisdictions for such registrations, filing or issuances and (3) no
claim has been asserted by any Person with respect to the use of any such
Intellectual Property, or challenging or questioning the validity or
effectiveness of any such Intellectual Property.

 

60

 

(t)            Business.  As of the Agreement Date, the Loan Parties
and the other Subsidiaries are engaged primarily in the business of owning,
funding the development of, operating, buying, selling and managing completed
retail properties leased to third party tenants principally, but not
exclusively, on a net lease basis.

 

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

 

(v)           Accuracy
and Completeness of Information.  All
written information, reports and other papers and data furnished to the Agent
or any Lender by, on behalf of, or at the direction of, any Loan Party or any
other Subsidiary were, at the time the same were so furnished, complete and
correct in all material respects, to the extent necessary to give the recipient
a true and accurate knowledge of the subject matter, or, in the case of
financial statements, present fairly, in accordance with GAAP consistently
applied throughout the periods involved, the financial position of the Persons
involved as at the date thereof and the results of operations for such periods.  No fact is known to any Loan Party which has
had, or may in the future have (so far as any Loan Party can reasonably
foresee), a Material Adverse Effect which has not been set forth in the
financial statements referred to in Section 7.1.(k) or in such
information, reports or other papers or data or otherwise disclosed in writing
to the Agent and the Lenders prior to the Closing Date.   No document furnished or written statement
made to the Agent or any Lender in connection with the negotiation, preparation
or execution, or pursuant to, of this Agreement or any of the other Loan
Documents contains or will contain any untrue statement of a fact material to
the creditworthiness of any Loan Party or any other Subsidiary or omits or will
omit to state a material fact necessary in order to make the statements
contained therein not materially misleading.

 

(w)          Unencumbered
Pool Properties. Each of the Unencumbered Pool Properties qualifies as an
Eligible Property and each Subsidiary that owns an Unencumbered Pool Property
is a Guarantor.

 

(x)            Not
Plan Assets; No Prohibited Transactions. 
None of the assets of any Loan Party or any other Subsidiary constitutes
“plan assets” within the meaning of ERISA, the Internal Revenue Code and the
respective regulations promulgated thereunder, of any Plan.  The execution, delivery and performance of
the Loan Documents by the Loan Parties, and the borrowing, other credit
extensions and repayment of amounts thereunder, do not and will not constitute “prohibited
transactions” under ERISA or the Internal Revenue Code.

 

(y)           Tax
Shelter Regulations.  None of the
Borrower, any other Loan Party nor any other Subsidiary of the Borrower intends
to treat the Loans or the transactions contemplated by this Agreement and the
other Loan Documents as being a “reportable transaction” (within the meaning of
Treasury Regulation Section 1.6011-4). 
If the Borrower, any other Loan Party or any other Subsidiary of the
Borrower determines to take any action inconsistent with such intention, the
Borrower will promptly notify the Agent thereof.  If the Borrower so notifies the Agent, the
Borrower acknowledges that one or more of the Lenders may treat its Loans as
part of a transaction

 

61

 

that is subject to Treasury Regulation Section 301.6112-1, and
such Lender or Lenders, as applicable, will maintain the lists and other
records, including the identity of the applicable Loan Parties, all as required
by such Treasury Regulation.

 

Section 7.2.  Survival of Representations and Warranties,
Etc.

 

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

 

ARTICLE VIII. AFFIRMATIVE COVENANTS

 

At all times on and after the Effective Date
and for so long as this Agreement is in effect, unless the Requisite Lenders
(or, if required pursuant to Section 13.7., all of the Lenders) shall
otherwise consent in the manner provided for in Section 13.7., the
Borrower shall comply with the following covenants:

 

Section 8.1.  Preservation of Existence and Similar
Matters.

 

Except as otherwise permitted under Section 10.4.,
the Borrower shall, and shall cause each other Loan Party and each other
Subsidiary to, preserve and maintain its respective existence, rights,
franchises, licenses and privileges in the jurisdiction of its incorporation or
formation and qualify and remain qualified and authorized to do business in
each jurisdiction in which the character of its properties or the nature of its
business requires such qualification and authorization and where the failure to
be so authorized and qualified could reasonably be expected to have a Material
Adverse Effect.

 

Section 8.2.  Compliance with Applicable Law.

 

The Borrower shall, and shall cause each
other Loan Party and each other Subsidiary to, comply with all Applicable Law,
including the obtaining of all Governmental Approvals, the failure with which
to comply could reasonably be expected to have a Material Adverse Effect.

 

62

 

Section 8.3.  Maintenance of Property.

 

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

 

Section 8.4.  Conduct of Business.

 

The Borrower shall, and shall cause the other
Loan Parties and each other Subsidiary to, carry on its respective businesses
as described in Section 7.1.(t) and not enter into any line of business
not otherwise engaged in by such Person as of the Agreement Date or not
otherwise reasonably related thereto.

 

Section 8.5.  Insurance.

 

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

 

Section 8.6.  Payment of Taxes and Claims.

 

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

 

Section 8.7.  Books and Records; Inspections.

 

The
Borrower will, and will cause each other Loan Party and each other Subsidiary
to, keep proper books of record and account in which full, true and correct
entries shall be made of all dealings and transactions in relation to its
business and activities.  The Borrower
will, and will cause each other Loan Party and each other Subsidiary to, permit
representatives of the Agent or any Lender to visit and inspect any of their
respective properties, to examine and make abstracts

 

63

 

from
any of their respective books and records and to discuss their respective
affairs, finances and accounts with their respective officers, employees and
independent public accountants (in the Borrower’s presence), all at such
reasonable times during business hours and as often as may reasonably be
requested and with reasonable prior notice. 
The Borrower shall be obligated to reimburse the Agent and the Lenders
for their reasonable costs and expenses incurred in connection with the
exercise of their rights under this Section only if such exercise occurs
while a Default or Event of Default exists.

 

Section 8.8.  Use of Proceeds.

 

The Borrower will only use the proceeds of
Loans only for (a) the payment of pre-development and development costs
incurred in connection with Properties owned by the Borrower or any Subsidiary;
(b) to finance acquisitions and equity investments otherwise permitted
under this Agreement; (c) to finance capital expenditures and the
repayment of Indebtedness of the Borrower and its Subsidiaries (including
scheduled amortization payments on Indebtedness); and (d) to provide for
the general working capital needs of the Borrower and its Subsidiaries and for
other general corporate purposes of the Borrower and its Subsidiaries
(including distributions and stock repurchases otherwise permitted under this
Agreement).  Except as permitted by Section 10.1.(e),
the Borrower shall not, and shall not permit any other Loan Party or any other
Subsidiary to, use any part of such proceeds to purchase or carry, or to reduce
or retire or refinance any credit incurred to purchase or carry, any margin
stock (within the meaning of Regulation U of the Board of Governors of the
Federal Reserve System) or to extend credit to others for the purpose of
purchasing or carrying any such margin stock.

 

Section 8.9.  Environmental Matters.

 

The Borrower shall, and shall cause each
other Loan Party and each other Subsidiary to, comply with all Environmental
Laws the failure with which to comply could reasonably be expected to have a
Material Adverse Effect.  If any Loan
Party or any other Subsidiary shall (a) receive written notice that any violation
of any Environmental Law may have been committed or is about to be committed by
such Person, (b) receive written notice that any administrative or
judicial complaint or order has been filed or is about to be filed against any
such Person alleging violations of any Environmental Law or requiring any such
Person to take any action in connection with the release of Hazardous Materials
or (c) receive any written notice from a Governmental Authority or private
party alleging that any such Person may be liable or responsible for costs
associated with a response to or cleanup of a release of Hazardous Materials or
any damages caused thereby, and such notices, individually or in the aggregate,
could reasonably be expected to have a Material Adverse Effect, the Borrower
shall provide the Agent with a copy of such notice within 10 days after the
receipt thereof by such Person or any of the Subsidiaries.  The Loan Parties and the other Subsidiaries
shall promptly take all actions necessary to prevent the imposition of any
Liens on any of their respective properties arising out of or related to any
Environmental Laws.

 

Section 8.10.  Further Assurances.

 

At the Borrower’s cost and expense and upon
request of the Agent, the Borrower shall, and shall cause each other Loan Party
and each other Subsidiary to, duly execute and deliver or

 

64

 

cause to be duly executed and delivered, to the Agent such further
instruments, documents and certificates, and do and cause to be done such
further acts that may be reasonably necessary or advisable in the reasonable
opinion of the Agent to carry out more effectively the provisions and purposes
of this Agreement and the other Loan Documents.

 

Section 8.11.  Material Contracts.

 

The Borrower shall, and shall cause each
other Loan Party and each other Subsidiary to, duly and punctually perform and
comply with any and all material representations, warranties, covenants and
agreements expressed as binding upon any such Person under any Material
Contract.  The Borrower shall not, and
shall not permit any other Loan Party or any other Subsidiary to, do or
knowingly permit to be done anything to impair materially the value of any of
the Material Contracts.

 

Section 8.12.  REIT Status.

 

The Borrower shall maintain its status as a
REIT.

 

Section 8.13.  Exchange Listing.

 

The Borrower shall maintain at least one
class of common shares of the Borrower listed on the New York Stock Exchange.

 

Section 8.14.  Guarantors.

 

Within 5 Business Days of any Person becoming
a Subsidiary after the Agreement Date, the Borrower shall deliver to the Agent
each of the following in form and substance satisfactory to the Agent: (a) an
Accession Agreement executed by such Subsidiary and (b) the items that
would have been delivered under subsections (iii), (v), (vi), (vii) and
(viii) of Section 6.1.(a) if such Subsidiary had been a
Subsidiary on the Agreement Date. 
Notwithstanding the foregoing, (x) upon the request of the Borrower
and so long as the Borrower complies with Section 10.10. with respect to
such Subsidiary, up to two Taxable REIT Subsidiaries shall not be required to
become a Guarantor and (y) if any other Subsidiary is unable, for reasons
acceptable to the Agent (in its sole discretion), to become a Guarantor, then
so long as the Borrower complies with Section 10.10. with respect to such
Subsidiary, such Subsidiary shall not be required to become a Guarantor.

 

Section 8.15.    Effective Date Matters.

 

On or prior to the Effective Date, the
Borrower shall deliver to the Agent each of the following in form and substance
satisfactory to the Agent: (a) updated information as of the Effective
Date (unless otherwise noted) for Schedules 4.1, 7.1(b), 7.1(f) (as of August 31,
2005), 7.1(g) (as of August 31, 2005) and 7.1(h) and (b) a
Notice of Borrowing requesting the Loans to be made on the Effective Date.

 

65

 

ARTICLE IX.
INFORMATION

 

At all times on and after the Effective Date
and for so long as this Agreement is in effect, unless the Requisite Lenders
(or, if required pursuant to Section 13.7., all of the Lenders) shall
otherwise consent in the manner set forth in Section 13.7., the Borrower
shall furnish to each Lender (or to the Agent if so provided below) at its Lending
Office:

 

Section 9.1.
 Quarterly
Financial Statements.

 

As soon as available and in any event within
45 days after the close of each of the first, second and third fiscal quarters
of the Borrower, the unaudited consolidated balance sheet of the Borrower and
its Subsidiaries as at the end of such period and the related unaudited
consolidated statements of income and cash flows of the Borrower and its
Subsidiaries for such period, setting forth in each case in comparative form
the figures as of the end of and for the corresponding periods of the previous
fiscal year, all of which shall be certified by the chief financial officer of
the Borrower, in his or her opinion, to present fairly, in accordance with
GAAP, the consolidated financial position of the Borrower and its Subsidiaries
as at the date thereof and the results of operations for such period (subject
to normal year-end audit adjustments).

 

Section 9.2.  Year-End Statements.

 

As soon as available and in any event within
90 days after the end of each fiscal year of the Borrower, the audited
consolidated balance sheet of the Borrower and its Subsidiaries as at the end
of such fiscal year and the related audited consolidated statements of income,
stockholders’ equity and cash flows of the Borrower and its Subsidiaries for
such fiscal year, setting forth in comparative form the figures as at the end
of and for the previous fiscal year, all of which shall be certified by (a) the
chief financial officer of the Borrower, in his or her opinion, to present
fairly, in accordance with GAAP, the financial position of the Borrower and its
Subsidiaries as at the date thereof and the result of operations for such
period and (b) KPMG LLP or any other independent certified public
accountants of recognized national standing acceptable to the Requisite
Lenders, whose certificate shall be unqualified and in scope and substance
satisfactory to the Requisite Lenders and who shall have authorized the
Borrower to deliver such financial statements and certification thereof to the
Agent and the Lenders pursuant to this Agreement.

 

Section 9.3.  Compliance Certificate.

 

At the time the financial statements are
furnished pursuant to the immediately preceding Sections 9.1. and 9.2., a
certificate substantially in the form of Exhibit P (a “Compliance
Certificate”) executed on behalf of the Borrower by the chief financial officer
of the Borrower (a) setting forth as of the end of such quarterly
accounting period or fiscal year, as the case may be, the calculations required
to establish whether the Borrower was in compliance with the covenants
contained in Section 10.1.; and (b) stating that no Default or Event
of Default exists, or, if such is not the case, specifying such Default or
Event of Default and its nature, when it occurred and the steps being taken by
the Borrower with respect to such event, condition or failure.

 

66

 

Section 9.4.  Other Information.

 

The Borrower will deliver to Agent:

 

(a)           Promptly upon receipt
thereof, copies of all reports, if any, submitted to the Borrower or its Board
of Directors by its independent public accountants including, without limitation,
any management report;

 

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

 

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

 

(d)           As soon as available
and in any event within 60 days after the end of each fiscal quarter of the
Borrower, a Unencumbered Pool Certificate setting forth the information to be
contained therein as of the last day of such fiscal quarter.

 

(e)           No later than 90 days
after the end of each fiscal year of the Borrower ending prior to the
Termination Date, projected balance sheets, operating statements and cash flow
budgets of the Borrower and its Subsidiaries on a consolidated basis for each quarter of the next succeeding fiscal year, all itemized in
reasonable detail. The foregoing shall be accompanied by pro forma
calculations, together with detailed assumptions, required to establish whether
or not the Borrower, and when appropriate its consolidated Subsidiaries, will
be in compliance with the covenants contained in Sections 10.1. and at the
end of each fiscal quarter of the next succeeding fiscal year.

 

(f)            Within 10 Business
Days of the Agent’s request therefor, a report in form and content reasonably
satisfactory to the Agent detailing the Borrower’s, together with its
Subsidiaries’, projected sources and uses of cash for the period of four
consecutive fiscal quarters immediately following the date of the Agent’s
request.  Such sources shall include but
not be limited to excess operating cash flow, availability under this
Agreement, unused availability under committed development loans, unfunded
committed equity and any other committed sources of funds.  Such uses shall include but not be limited to
cash obligations for binding acquisitions, unfunded development costs, capital
expenditures, debt service, overhead, dividends, maturing Property loans, hedge
settlements and other anticipated uses of cash.

 

(g)           Within 15 Business Days
of the Agent’s request therefor, additional financial information maintained
with respect to the Borrower and its Subsidiaries and each Eligible Property
including, without limitation, property management exception reports, current
property portfolio listings, listings of the Borrower’s and its Subsidiaries’
acquisitions from the most recent fiscal quarter provided on a cost basis,
appraised value basis and/or projected annual rent basis.

 

67

 

(h)           If and when any member
of the ERISA Group (i) gives or is required to give notice to the PBGC of
any “reportable event” (as defined in Section 4043 of ERISA) with respect
to any Plan which might constitute grounds for a termination of such Plan under
Title IV of ERISA, or knows that the plan administrator of any Plan has given
or is required to give notice of any such reportable event, a copy of the
notice of such reportable event given or required to be given to the PBGC;
(ii) receives notice of complete or partial withdrawal liability under
Title IV of ERISA or notice that any Multiemployer Plan is in reorganization,
is insolvent or has been terminated, a copy of such notice; (iii) receives
notice from the PBGC under Title IV of ERISA of an intent to terminate, impose
liability (other than for premiums under Section 4007 of ERISA) in respect
of, or appoint a trustee to administer any Plan, a copy of such notice;
(iv) applies for a waiver of the minimum funding standard under
Section 412 of the Internal Revenue Code, a copy of such application;
(v) gives notice of intent to terminate any Plan under
Section 4041(c) of ERISA, a copy of such notice and other information
filed with the PBGC; (vi) gives notice of withdrawal from any Plan
pursuant to Section 4063 of ERISA, a copy of such notice; or
(vii) fails to make any payment or contribution to any Plan or
Multiemployer Plan or in respect of any Benefit Arrangement or makes any
amendment to any Plan or Benefit Arrangement which has resulted or could result
in the imposition of a Lien or the posting of a bond or other security, a
certificate of the controller of the Borrower setting forth details as to such
occurrence and action, if any, which the Borrower or applicable member of the
ERISA Group is required or proposes to take;

 

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

 

(j)            A copy of any
amendment to the articles of incorporation, bylaws, partnership agreement or
other similar organizational documents of any Loan Party or any other
Subsidiary within 5 Business Days of the effectiveness thereof;

 

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

 

(l)            Prompt notice of the
occurrence of any Default or Event of Default or any event which constitutes or
which with the passage of time, the giving of notice, or otherwise, would
constitute a default or event of default by any Loan Party or any other
Subsidiary under any Material Contract to which any such Person is a party or
by which any such Person or any of its respective properties may be bound;

 

68

 

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

 

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

 

(o)           Prompt notice of any
written notification of a material violation of any law or regulation or any
inquiry shall have been received by any Loan Party or any other Subsidiary from
any Governmental Authority;

 

(p)           Prompt notice of the
acquisition, incorporation or other creation of any Subsidiary, the purpose for
such Subsidiary, the nature of the assets and liabilities thereof and whether
such Subsidiary is a Wholly Owned Subsidiary of the Borrower;

 

(q)           Promptly upon the
request of the Agent, evidence of the Borrower’s calculation of the Ownership
Share with respect to a Subsidiary or an Unconsolidated Affiliate, such
evidence to be in form and detail satisfactory to the Agent; and

 

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

 

ARTICLE X. NEGATIVE COVENANTS

 

At all times on and after the Effective Date and for so long as this
Agreement is in effect, unless the Requisite Lenders (or, if required pursuant
to Section 13.7., all of the Lenders) shall otherwise consent in the
manner set forth in Section 13.7., the Borrower shall comply with the
following covenants:

 

Section 10.1.  Financial Covenants.

 

(a)           Minimum Tangible Net
Worth.  The Borrower shall not permit
its Tangible Net Worth determined on a consolidated basis at the end of any
fiscal quarter to be less than an amount equal to the greater of
(i)(A) 80% of the Tangible Net Worth of the Borrower as of
September 30, 2005 plus (B) 80% of the Net Proceeds of all
Equity Issuances effected at any time after September 30, 2005 by the
Borrower or any of its Subsidiaries to any Person other than the Borrower or
any of its Subsidiaries plus (C) 80% of the market value (at the
time of issuance) of any shares or partnership units issued at any time after
September 30, 2005 in exchange for any property contributed to the
Borrower or any of its Subsidiaries by any Person other than the Borrower or
any of its Subsidiaries minus (D) the aggregate amount paid by the
Borrower to purchase outstanding shares of its common stock and Preferred Stock
(to the extent such payments are permitted by Section 10.1.(e)) at any
time after September 30, 2005 or (ii) $500,000,000.

 

69

 

(b)           Ratio of Total
Liabilities to Gross Asset Value. 
The Borrower shall not permit the ratio of (i) Total Liabilities of
the Borrower and its Subsidiaries determined on a consolidated basis to
(ii) Gross Asset Value of the Borrower and its Subsidiaries determined on
a consolidated basis to exceed .55 to 1.00 at any time.

 

(c)           Ratio of EBITDA to
Fixed Charges.  The Borrower shall
not permit, for any fiscal quarter, the ratio of (i) EBITDA of the
Borrower and its Subsidiaries determined on a consolidated basis for such
fiscal quarter to (ii) Fixed Charges of the Borrower and its Subsidiaries
determined on a consolidated basis for such fiscal quarter, to be less than
1.75 to 1.00 at the end of such fiscal quarter.

 

(d)           Permitted
Investments.  The Borrower shall not,
and shall not permit any Loan Party or other Subsidiary to, make an Investment
in or otherwise own the following items that would cause the aggregate value of
such holdings of such Persons to exceed the following percentages of the Gross
Asset Value:

 

(i)            assets,
(excluding (w) Properties which are retail properties leased to third
party tenants on a net lease basis, (x) equity interests in Subsidiaries,
(y) cash and (z) any assets of the types described in items
(ii) through (vi) below), such that the portion of the total Gross
Asset Value associated with such assets exceeds 15% of Gross Asset Value;

 

(ii)           unimproved
real estate, (which shall not include (x) any Development Property or
(y) unimproved real estate acquired less than 12 months previously and
with respect to which a Development Property is planned within 12 months of its
acquisition) such that the aggregate book value of all such unimproved real
estate exceeds 5% of the Gross Asset Value;

 

(iii)          Common
stock, Preferred Stock, other capital stock, beneficial interest in trust,
membership interest in limited liability companies and other equity interests
in Persons (other than consolidated Subsidiaries and Unconsolidated
Affiliates), such that the aggregate value of such interests calculated on the
basis of the lower of cost or market, exceeds 10% of the Gross Asset Value;

 

(iv)          Mortgages
in favor of the Borrower or any other Loan Party, such that the aggregate book
value of Indebtedness secured by such Mortgages exceeds 10% of the Gross Asset
Value;

 

(v)           Investments
in Unconsolidated Affiliates, such that the aggregate value of such Investments
in Unconsolidated Affiliates, exceeds 15% of the Gross Asset Value.  For purposes of this clause (iv), the “value”
of any such Investment in an Unconsolidated Affiliate shall equal (1) with
respect to any of such Unconsolidated Affiliate’s Properties under
construction, the Borrower’s Ownership Share of the book value of construction
in

 

70

 

process for such Property as of the date of determination and
(2) with respect to any of such Unconsolidated Affiliate’s Properties
which have been completed, the Borrower’s Ownership Share of Capitalized EBITDA
of such Unconsolidated Affiliate attributable to such Properties; and

 

(vi)          the
aggregate amount of the Total Budgeted Costs for Development Properties in
which the Borrower either has a direct or indirect ownership interest shall not
exceed 10% of the Gross Asset Value.  If
a Development Property is owned by an Unconsolidated Affiliate of the Borrower,
or any other Subsidiary, then the greater of (1) the product of
(A) the Borrower’s or such Subsidiary’s Ownership Share in such
Unconsolidated Affiliate and (B) the amount of the Total Budgeted Costs
for such Development Property or (2) the recourse obligations of the
Borrower or such Subsidiary relating to the Indebtedness of such Unconsolidated
Affiliate, shall be used in calculating such investment limitation.

 

In addition to the foregoing limitations, the aggregate value of the
Investments subject to the limitations in the preceding clauses
(i) through (v) shall not exceed 30% of the Gross Asset Value.

 

(e)           Dividends and Other
Restricted Payments.  If no Event of
Default exists, the Borrower shall not declare or make, or incur any liability
to make, any Restricted Payments other than (i) cash distributions to its
preferred and common shareholders and (ii) payments made to purchase
outstanding shares of the preferred and common stock of the Borrower, which
distributions to common shareholders and payments to repurchase common shares
in the aggregate shall not exceed the sum of 95% of Funds From Operations plus
cash distributions to its preferred shareholders as of the end of each fiscal
quarter for the four fiscal quarter period then ending; provided that the
Borrower may repurchase or redeem preferred stock with the net proceeds from
the issuance of preferred stock or common stock.  If a Default or an Event of Default under Section 11.1.(a),
(e) or (f) shall exist neither the Borrower nor any Subsidiary (other
than Wholly Owned Subsidiaries) shall directly or indirectly declare or make,
or incur any liability to make, any Restricted Payments.  If any other Event of Default exists, neither
the Borrower nor any Subsidiary (other than Wholly Owned Subsidiaries) shall
directly or indirectly declare or make, or incur any liability to make, any
Restricted Payments except that the Borrower may make cash distributions to its
shareholders in the minimum amount necessary to maintain compliance with
Section 8.12.

 

Section 10.2.  Negative Pledge.

 

The Borrower shall not, and shall not permit any other Loan Party or
any other Subsidiary to, (a) create, assume, incur or permit or suffer to
exist any Lien upon any of the Unencumbered Pool Properties or any direct or
indirect ownership interest of the Borrower in any Subsidiary owning any
Unencumbered Pool Property, other than Permitted Liens, or (b) permit any
Unencumbered Pool Property, or any direct or indirect ownership interest of the
Borrower in any Subsidiary owning any Unencumbered Pool Property, to become
subject to a Negative Pledge, in each case if there then exists a Default or an
Event of Default or if such event causes a Borrowing Base overadvance as
contemplated by Section 2.7.(b)(ii).

 

71

 

Section 10.3.  Restrictions on Intercompany Transfers.

 

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

 

Section 10.4.  Merger, Consolidation, Sales of Assets and
Other Arrangements.

 

The Borrower shall not, and shall not permit any other
Loan Party or any other Subsidiary to, (a) enter into any transaction of
merger or consolidation; (b) liquidate, windup or dissolve itself (or
suffer any liquidation or dissolution); (c) convey, sell, lease, sublease,
transfer or otherwise dispose of, in one transaction or a series of
transactions, all or any substantial part of its business or assets, or the
capital stock of or other Equity Interests in any of its Subsidiaries, whether
now owned or hereafter acquired; or (d) acquire the assets in the amount
of the Substantial Amount of, or make an Investment in the amount of the
Substantial Amount in, any other Person; provided, however, that:

 

(i)            any
Subsidiary may merge with a Loan Party so long as such other Loan Party is the
survivor;

 

(ii)           any
Subsidiary may sell, transfer or dispose of its assets to a Loan Party;

 

(iii)          a
Loan Party (other than the Borrower or any Loan Party which owns a Unencumbered
Pool Property) and any Subsidiary that is not (and is not required to be) a
Loan Party may convey, sell, transfer or otherwise dispose of, in one
transaction or a series of transactions, all or any substantial part of its
business or assets, or the capital stock of or other Equity Interests in any of
its Subsidiaries, and immediately thereafter liquidate, provided that
immediately prior to any such conveyance, sale, transfer, disposition or
liquidation and immediately thereafter and after giving effect thereto, no
Default or Event of Default is or would be in existence;

 

(iv)          any Loan
Party and any other Subsidiary may, directly or indirectly, (A) acquire
(whether by purchase, acquisition of Equity Interests of a Person, or as a
result of a merger or consolidation) assets in the amount of the Substantial
Amount of, or make an Investment in the amount of the Substantial Amount in,
any other Person and (B) sell, lease or otherwise transfer, whether by one
or a series of transactions, assets in the amount of the Substantial Amount
(including capital stock or other securities of Subsidiaries) to any other
Person, so long as, in each case, (1) the Borrower shall have given the
Agent and the Lenders at least 30 days prior
written notice of the completion of such consolidation, merger, acquisition,
Investment, sale, lease or other transfer; (2) immediately prior thereto,
and immediately thereafter and after giving effect thereto, no Default or Event
of Default is or would be in existence; (3) in the case of a consolidation
or merger involving the Borrower or a Loan Party which owns a

 

72

 

Unencumbered Pool
Property, such Person shall be the survivor thereof and (4) at the time
the Borrower gives notice pursuant to clause (1) of this subsection,
the Borrower shall have delivered to the Agent and the Lenders a Compliance
Certificate, calculated on a pro forma basis, evidencing the continued
compliance by the Loan Parties with the terms and conditions of this Agreement
and the other Loan Documents, including without limitation, the financial
covenants contained in Section 10.1., after giving effect to such
consolidation, merger, acquisition, Investment, sale, lease or other transfer;
and

 

(v)           the
Borrower, the Loan Parties and the other Subsidiaries may lease and sublease
their respective assets, as lessor or sublessor (as the case may be) in the
ordinary course of business, and may purchase and sell their respective assets
in the ordinary course of their business.

 

Further, no Loan Party nor any Subsidiary, shall enter into any
sale-leaseback transactions or other transaction by which such Person shall
remain liable as lessee (or the economic equivalent thereof) of any real or
personal property that it has sold or leased to another Person where the
transaction is in an amount which exceeds $10,000,000.

 

Section 10.5.  Plans.

 

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

 

Section 10.6.  Fiscal Year.

 

The Borrower shall not, and shall not permit any Loan Party or other
Subsidiary to, change its fiscal year from that in effect as of the Agreement
Date.

 

Section 10.7.  Modifications of Organizational Documents.

 

The Borrower shall not enter into, and shall not permit any Subsidiary
or other Loan Party to enter into any amendment, supplement, restatement or
other modification of its certificate or articles of incorporation, articles of
organization, certificate of limited partnership, declaration of trust or other
comparable organizational instrument (if any) that could reasonably be expected
to have a Material Adverse Effect.

 

Section 10.8.  Modifications to Material Contracts.

 

The Borrower shall not enter into, or permit any Subsidiary or other
Loan Party to enter into, any amendment or modification to any Material
Contract which could reasonably be expected to have a Material Adverse Effect
or default in the performance of any obligations of the Borrower or any
Subsidiary in any Material Contract or permit any Material Contract to be
canceled or terminated prior to its stated maturity.

 

73

 

Section 10.9.  Transactions with Affiliates.

 

The Borrower shall not permit to exist or enter into, and will not
permit any Loan Party or other Subsidiary to permit to exist or enter into, any
transaction (including the purchase, sale, lease or exchange of any property or
the rendering of any service) with any Affiliate of the Borrower or with any
director or senior officer of any Loan Party, except (a) as set forth on
Schedule 7.1.(r) or (b) transactions that are (i) in an amount less than $2,000,000
and are approved by a majority of the members of the Borrower’s board of
directors that are not party to the applicable transaction (the “Disinterested
Directors”) or (ii) in the ordinary course of
business and pursuant to the reasonable requirements of the business of the
Borrower or any of its Subsidiaries and upon fair and reasonable terms which
are no less favorable to the Borrower or such Subsidiary than would be obtained
in a comparable arm’s length transaction with a Person that is not an Affiliate, as reasonably determined in good
faith by the Disinterested Directors.  Notwithstanding the foregoing, no payments
may be made with respect to any items set forth on such Schedule upon the
occurrence and during the continuation of a Default or Event of Default.

 

Section 10.10.  Limitations on Non-Guarantor Subsidiaries.

 

The Borrower shall not, and shall not permit any Loan Party or other
Subsidiary to, with respect to any Subsidiary (including a Taxable REIT
Subsidiary) that does not execute a Guaranty pursuant to Section 8.14.,
(a) permit such Subsidiary to incur any Indebtedness other than Non
Recourse Indebtedness and (b) make an Investment in, (i) in the case
of such Subsidiaries that are Taxable REIT Subsidiaries (other than Crest Net
Lease, Inc.), in an aggregate amount in excess of $50,000,000; provided,
however, that the Borrower may make or permit to exist an Investment in Crest
Net Lease, Inc. of up to, but not exceeding $125,000,000 and (ii) in
the case of such Subsidiaries that are not Taxable REIT Subsidiaries, in an
aggregate amount in excess of $50,000,000.

 

ARTICLE XI. DEFAULT

 

Section 11.1.  Events of Default.

 

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

 

(a)           Default in Payment.  The Borrower shall, under this Agreement or
any other Loan Document, fail to pay (whether upon demand, at maturity, by
reason of acceleration or otherwise), (i) when due, the principal on any
of the Loans or (ii) within five days of the date the Borrower or any
other Loan Party has received notice of such failure from the Agent, any
interest or fees on any of the Loans or other payment Obligations owing by the
Borrower under this Agreement or any other Loan Document, or any other Loan
Party shall fail to pay when due any payment obligation owing by such Loan
Party under any Loan Document to which it is a party.

 

74

 

(b)           Default in
Performance.

 

(i)            Any
Loan Party shall fail to perform or observe any term, covenant, condition or
agreement on its part to be performed or observed and contained in Sections
9.4.(m) or Article X. (other than Section 10.1., 10.9. and 10.10.);
or

 

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

 

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

 

(d)           Indebtedness
Cross-Default.

 

(i)            Any
Loan Party shall fail to pay when due and payable the principal of, or interest
on, any Indebtedness (other than the Loans) having an aggregate outstanding
principal amount of $10,000,000 or more (“Material Indebtedness”) and such
failure shall continue beyond any applicable cure periods; or

 

(ii)           (x) The
maturity of any Material Indebtedness shall have been accelerated in accordance
with the provisions of any indenture, contract or instrument evidencing,
providing for the creation of or otherwise concerning such Material
Indebtedness or (y) any Material Indebtedness shall have been required to
be prepaid or repurchased prior to the stated maturity thereof.

 

(e)           Voluntary Bankruptcy
Proceeding.  The Borrower or any
Subsidiary shall:  (i) commence a
voluntary case under the Bankruptcy Code of 1978, as amended, or other federal
bankruptcy laws (as now or hereafter in effect); (ii) file a petition
seeking to take advantage of any other Applicable Laws, domestic or foreign,
relating to bankruptcy, insolvency, reorganization, winding-up, or composition
or adjustment of debts; (iii) consent to, or fail to contest in a timely
and appropriate manner, any petition filed against it in an involuntary case
under such bankruptcy laws or other Applicable Laws or consent to any
proceeding or action described in the immediately following subsection;
(iv) apply for or consent to, or fail to contest in a timely and
appropriate manner, the appointment of, or the taking of possession by, a
receiver, custodian, trustee, or liquidator of itself or of a substantial part
of its property, domestic or foreign; (v) admit in writing its inability
to pay its debts as they become due; (vi) make a general assignment for
the benefit of creditors; (vii) make a conveyance fraudulent as to
creditors under any Applicable Law; or (viii) take any corporate or
partnership action for the purpose of effecting any of the foregoing.

 

75

 

(f)            Involuntary
Bankruptcy Proceeding.  A case or
other proceeding shall be commenced against Borrower or any Subsidiary in any
court of competent jurisdiction seeking: 
(i) relief under the Bankruptcy Code of 1978, as amended or other
federal bankruptcy laws (as now or hereafter in effect) or under any other
Applicable Laws, domestic or foreign, relating to bankruptcy, insolvency,
reorganization, winding-up, or composition or adjustment of debts; or
(ii) the appointment of a trustee, receiver, custodian, liquidator or the
like of such Person, or of all or any substantial part of the assets, domestic
or foreign, of such Person, and in the case of either clause (i) or
(ii) such case or proceeding shall continue undismissed or unstayed for a
period of 60 consecutive calendar days, or an order granting the relief
requested in such case or proceeding (including, but not limited to, an order
for relief under such Bankruptcy Code or such other federal bankruptcy laws)
shall be entered.

 

(g)           Revocation of Loan
Documents.  Any Loan Party shall (or
shall attempt to) disavow, revoke or terminate any Loan Document to which it is
a party or shall otherwise challenge or contest in any action, suit or
proceeding in any court or before any Governmental Authority the validity or
enforceability of any Loan Document.

 

(h)           Judgment.   A judgment or order for the payment of money
shall be entered against the Borrower or any Subsidiary, by any court or other
tribunal and (i) such judgment or order shall continue for a period of 60
days without being paid stayed or dismissed through appropriate appellate
proceedings and (ii) either (A) the amount for which insurance has
not been acknowledged in writing by the applicable insurance carrier (or the
amount as to which the insurer has denied liability) exceeds, individually or
together with all other such judgments or orders entered against the Borrower
and all Subsidiaries, $15,000,000 or
(B) such judgment or order could reasonably be expected to have a Material
Adverse Effect.

 

(i)            Attachment.  A warrant, writ of attachment, execution or
similar process shall be issued against any property of the Borrower or any
Subsidiary, which exceeds, individually or together with all other such
warrants, writs, executions and processes, $10,000,000 in amount and such
warrant, writ, execution or process shall not be paid, discharged, vacated,
stayed or bonded for a period of 60 days; provided, however, that if a bond has
been issued in favor of the claimant or other Person obtaining such warrant,
writ, execution or process, the issuer of such bond shall execute a waiver or
subordination agreement in form and substance satisfactory to the Agent
pursuant to which the issuer of such bond subordinates its right of
reimbursement, contribution or subrogation to the Obligations and waives or
subordinates any Lien it may have on the assets of the Borrower or any
Subsidiary.

 

(j)            ERISA.  Any member of the ERISA Group shall fail to
pay when due an amount or amounts aggregating in excess of $10,000,000 which it
shall have become liable to pay under Title IV of ERISA; or notice of intent to
terminate a Material Plan shall be filed under Title IV of ERISA by any member
of the ERISA Group, any plan administrator or any combination of the foregoing;
or the PBGC shall institute proceedings under Title IV of ERISA to terminate,
to impose liability (other than for premiums under Section 4007 of ERISA)
in respect of, or to

 

76

 

cause a trustee to be appointed
to administer any Material Plan; or a condition shall exist by reason of which
the PBGC would be entitled to obtain a decree adjudicating that any Material
Plan must be terminated; or there shall occur a complete or partial withdrawal
from, or a default, within the meaning of Section 4219(c)(5) of
ERISA, with respect to, one or more Multiemployer Plans which could cause one
or more members of the ERISA Group to incur a current payment obligation in
excess of $10,000,000.

 

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

 

(l)            Change
of Control/Change in Management.

 

(i)            Any
“person” or “group” (as such terms are used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”)), is or becomes the “beneficial owner” (as defined in Rules 13d-3
and 13d-5 under the Exchange Act, except that a Person will be deemed to have “beneficial
ownership” of all securities that such Person has the right to acquire, whether
such right is exercisable immediately or only after the passage of time),
directly or indirectly, of more than 50% of the total voting power of the then
outstanding voting stock of the Borrower;

 

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

 

(iii)          If
any three of Thomas Lewis, Gary Malino, Paul Meurer or Mike Pfeiffer cease for
any reason to be principally involved in the senior management of the Borrower,
and the Borrower shall have failed to replace the resulting vacancies in senior
management with an individual or individuals reasonably acceptable to the Requisite Lenders within a period of
nine months.

 

(m)          Damage; Strike;
Casualty.  Any material damage to, or
loss, theft or destruction of, any Property, whether or not insured, or any
strike, lockout, labor dispute, embargo, condemnation, act of God or public
enemy, or other casualty which causes, for more than 30 consecutive days beyond
the coverage period of any applicable business interruption insurance, the
cessation or substantial curtailment of revenue producing activities of the
Borrower or its Subsidiaries taken as a whole and only if any such event or
circumstance could reasonably be expected to have a Material Adverse Effect.

 

(n)           Material Adverse
Effect.  There shall occur any event
that has or is reasonably likely to have a Material Adverse Effect.

 

77

 

Section 11.2.  Remedies Upon Event of Default.

 

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

 

(a)           Acceleration;
Termination of Facilities.

 

(i)            Automatic.  Upon the occurrence of an Event of Default
specified in Sections 11.1.(e) or 11.1.(f), (1)(A) the principal
of, and all accrued interest on, the Loans and the Notes at the time
outstanding and (B) all of the other Obligations of the Borrower,
including, but not limited to, the other amounts owed to the Lenders and the
Agent under this Agreement, the Notes or any of the other Loan Documents shall
become immediately and automatically due and payable by the Borrower without
presentment, demand, protest, or other notice of any kind, all of which are
expressly waived by the Borrower, and (2) the Commitments and the
Swingline Commitment and the obligation of the Lenders to make Loans hereunder,
shall all immediately and automatically terminate.

 

(ii)           Optional.  If any other Event of Default shall exist,
the Agent may, and at the direction of the Requisite Lenders (which must
include the Lender then acting as Agent) shall: 
(1) declare (A) the principal of, and accrued interest on, the
Loans and the Notes at the time outstanding and (B) all of the other
Obligations, including, but not limited to, the other amounts owed to the
Lenders and the Agent under this Agreement, the Notes or any of the other Loan
Documents to be forthwith due and payable, whereupon the same shall immediately
become due and payable without presentment, demand, protest or other notice of
any kind, all of which are expressly waived by the Borrower, and
(2) terminate the Commitments and the obligation of the Lenders to make
Loans hereunder.  If the Agent has
exercised any of the rights provided under the preceding sentence, the
Swingline Lender shall:  (x) declare
the principal of, and accrued interest on, the Swingline Loans and the
Swingline Notes at the time outstanding, and all of the other Obligations owing
to the Swingline Lender, to be forthwith due and payable, whereupon the same
shall immediately become due and payable without presentment, demand, protest
or other notice of any kind, all of which are expressly waived by the Borrower
and (y) terminate the Swingline Commitment and the obligation of the
Swingline Lender to make Swingline Loans.

 

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

 

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

 

(d)           Appointment of
Receiver.  To the extent permitted by
Applicable Law, the Agent and the Lenders shall be entitled to the appointment
of a receiver for the assets and properties of the Borrower and its
Subsidiaries, without notice of any kind whatsoever and without regard to the
adequacy of any security for the Obligations or the solvency of any party bound
for its

 

78

 

payment, to take possession of
all or any portion of the Unencumbered Pool Properties and/or the business
operations of the Borrower and its Subsidiaries and to exercise such power as
the court shall confer upon such receiver.

 

(e)           Rescission of Acceleration by Requisite Lenders. 
If at any time after acceleration of the maturity of the Loans and the
other Obligations, the Borrower shall pay all arrears of interest and all
payments on account of principal of the Obligations which shall have become due
otherwise than by acceleration (with interest on principal and, to the extent
permitted by Applicable Law, on overdue interest, at the rates specified in
this Agreement) and all Events of Default and Defaults (other than nonpayment
of principal of and accrued interest on the Obligations due and payable solely
by virtue of acceleration) shall become remedied or waived to the satisfaction
of the Requisite Lenders (which must include the Lender then acting as Agent),
then by written notice to the Borrower, the Requisite Lenders (which must
include the Lender then acting as Agent) may elect, in the sole discretion of
such Requisite Lenders, to rescind and annul the acceleration and its
consequences.  The provisions of the preceding
sentence are intended merely to bind all of the Lenders to a decision which may
be made at the election of the Requisite Lenders, and are not intended to
benefit the Borrower and do not give the Borrower the right to require the
Lenders to rescind or annul any acceleration hereunder, even if the conditions
set forth herein are satisfied.

 

Section 11.3.  Remedies Upon Default.

 

Upon the occurrence of a Default specified in
Sections 11.1.(e) or 11.1.(f), the Commitments shall immediately and
automatically terminate.

 

Section 11.4.  Marshaling; Payments Set Aside.

 

Neither the Agent nor any Lender shall be under any obligation to
marshal any assets in favor of any Loan Party or any other party or against or
in payment of any or all of the Obligations. 
To the extent that any Loan Party makes a payment or payments to the
Agent and/or any Lender, or the Agent and/or any Lender enforce their security
interests or exercise their rights of setoff, and such payment or payments or
the proceeds of such enforcement or setoff or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside and/or
required to be repaid to a trustee, receiver or any other party under any
bankruptcy law, state or federal law, common law or equitable cause, then to
the extent of such recovery, the Obligations or part thereof originally
intended to be satisfied, and all Liens, rights and remedies therefor, 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.

 

79

 

Section 11.5.  Allocation of Proceeds.

 

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

 

(a)           amounts
due to the Agent and the Lenders in respect of Fees and expenses due under
Section 13.2.;

 

(b)           payments
of interest on Swingline Loans;

 

(c)           payments
of interest on all other Loans, to be applied for the ratable benefit of the
Lenders, in such order as the Lenders may determine in their sole discretion;

 

(d)           payment
of principal on Swingline Loans;

 

(e)           payments
of principal of all other Loans, to be applied for the ratable benefit of the
Lenders, in such order as the Lenders may determine in their sole discretion;

 

(f)            amounts
due to the Agent and the Lenders pursuant to Sections 12.7. and 13.10.;

 

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

 

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

 

Section 11.6.  Performance by Agent.

 

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

 

Section 11.7.  Rights Cumulative.

 

The rights and remedies of the Agent and the Lenders under this
Agreement and each of the other Loan Documents shall be cumulative and not
exclusive of any rights or remedies which any of them may otherwise have under
Applicable Law.  In exercising their
respective rights and remedies the Agent and the Lenders may be selective and
no failure or delay by the Agent or any of the Lenders in exercising any right
shall operate as a waiver of it, nor shall any single or partial exercise of
any power or right preclude its other or further exercise or the exercise of
any other power or right.  For the
avoidance of doubt, if a Default or Event of Default has occurred under the
Existing Credit Agreement prior to the Effective Date such Default or Event of
Default shall continue to exist on and after the Effective Date (without any
interruption in the passage of time for any applicable cure period) unless such
Default or Event of Default has otherwise been waived by the Lenders in writing
in accordance with this Agreement.

 

80

 

ARTICLE XII. THE AGENT

 

Section 12.1.  Appointment and Authorization.

 

Each Lender hereby irrevocably appoints and authorizes the Agent to
take such action as contractual representative on such Lender’s behalf and to
exercise such powers under this Agreement and the other Loan Documents as are
specifically delegated to the Agent by the terms hereof and thereof, together
with such powers as are reasonably incidental thereto. Not in limitation of the
foregoing, each Lender authorizes and directs the Agent to enter into the Loan
Documents (other than the Credit Agreement) for the benefit of the
Lenders.  Each Lender hereby agrees that,
except as otherwise set forth herein, any action taken by the Requisite Lenders
in accordance with the provisions of this Agreement or the Loan Documents, and
the exercise by the Requisite Lenders of the powers set forth herein or
therein, together with such other powers as are reasonably incidental thereto,
shall be authorized and binding upon all of the Lenders.  Nothing herein shall be construed to deem the
Agent a trustee or fiduciary for any Lender or to impose on the Agent duties or
obligations other than those expressly provided for herein.  Without limiting the generality of the
foregoing, the use of the terms “Agent”, “Agent”, “agent” and similar terms in
the Loan Documents with reference to the Agent is not intended to connote any
fiduciary or other implied (or express) obligations arising under agency
doctrine of any Applicable Law.  Instead,
use of such terms is merely a matter of market custom, and is intended to
create or reflect only an administrative relationship between independent
contracting parties.  The Agent shall
deliver to each Lender, promptly upon receipt thereof by the Agent, copies of
each of the financial statements, certificates, notices and other documents
delivered to the Agent pursuant to Article IX.  The Agent will also furnish to any Lender,
upon the request of such Lender, a copy (or, where appropriate, an original) of
any document, instrument, agreement, certificate or notice furnished to the
Agent by the Borrower, any Loan Party or any other Affiliate of the Borrower,
pursuant to this Agreement or any other Loan Document not already delivered to
such Lender pursuant to the terms of this Agreement or any such other Loan
Document.  As to any matters not
expressly provided for by the Loan Documents (including, without limitation,
enforcement or collection of any of the Obligations), the Agent shall not be
required to exercise any discretion or take any action, but shall be required
to act or to refrain from acting (and shall be fully protected in so acting or
refraining from acting) upon the instructions of the Requisite Lenders (or all
of the Lenders if explicitly required under any other provision of this
Agreement), and such instructions shall be binding upon all Lenders and all
holders of any of the Obligations; provided, however, that, notwithstanding
anything in this Agreement to the contrary, the Agent shall not be required to
take any action which exposes the Agent to personal liability or which is
contrary to this Agreement or any other Loan Document or Applicable Law.  Not in limitation of the foregoing, the Agent
shall exercise any right or remedy it or the Lenders may have under any Loan
Document upon the occurrence of a Default or an Event of Default unless the
Requisite Lenders have directed the Agent otherwise.  Without limiting the foregoing, no Lender
shall have any right of action whatsoever against the Agent as a result of the Agent
acting or refraining from acting under this Agreement or any of the other Loan
Documents in accordance with the instructions of the Requisite Lenders, or
where applicable, all the Lenders.

 

81

 

Section 12.2.  Agent’s Reliance, Etc.

 

Notwithstanding any other provisions of this Agreement
or any other Loan Documents, neither the Agent nor any of its directors,
officers, agents, employees or counsel shall be liable for any action taken or
not taken by it under or in connection with this Agreement or any other Loan
Document, except for its or their own gross negligence or willful misconduct in
connection with its duties expressly set forth herein or therein.  Without limiting the generality of the
foregoing, the Agent: may consult with legal counsel (including its own counsel
or counsel for the Borrower or any other Loan Party), independent public
accountants and other experts selected by it and shall not be liable for any
action taken or omitted to be taken in good faith by it in accordance with the
advice of such counsel, accountants or experts. 
Neither the Agent nor any of its directors, officers, agents, employees
or counsel: (a) makes any warranty or representation to any Lender or any
other Person and shall be responsible to any Lender or any other Person for any
statement, warranty or representation made or deemed made by the Borrower, any
other Loan Party or any other Person in or in connection with this Agreement or
any other Loan Document; (b) shall have any duty to ascertain or to inquire
as to the performance or observance of any of the terms, covenants or
conditions of this Agreement or any other Loan Document or the satisfaction of
any conditions precedent under this Agreement or any Loan Document on the part
of the Borrower or other Persons or inspect the property, books or records of
the Borrower or any other Person; (c) shall be responsible to any Lender
for the due execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement or any other Loan Document, any other
instrument or document furnished pursuant thereto or any collateral covered
thereby or the perfection or priority of any Lien in favor of the Agent on
behalf of the Lenders in any such collateral; (d) shall have any liability
in respect of any recitals, statements, certifications, representations or
warranties contained in any of the Loan Documents or any other document,
instrument, agreement, certificate or statement delivered in connection
therewith; and (e) shall incur any liability under or in respect of this
Agreement or any other Loan Document by acting upon any notice, consent,
certificate or other instrument or writing (which may be by telephone, telecopy
or electronic mail) believed by it to be genuine and signed, sent or given by the
proper party or parties.  The Agent may
execute any of its duties under the Loan Documents by or through agents,
employees or attorneys-in-fact and shall not be responsible for the negligence
or misconduct of any agent or attorney-in-fact that it selects in the absence
of gross negligence or willful misconduct.

 

Section 12.3.  Notice of Defaults.

 

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

 

82

 

Section 12.4.  Wells Fargo as Lender.

 

Wells Fargo, as a Lender, shall have the same rights and powers under
this Agreement and any other Loan Document as any other Lender and may exercise
the same as though it were not the Agent; and the term “Lender” or “Lenders”
shall, unless otherwise expressly indicated, include Wells Fargo in each case
in its individual capacity.  Wells Fargo
and its affiliates may each accept deposits from, maintain deposits or credit
balances for, invest in, lend money to, act as trustee under indentures of,
serve as financial advisor to, and generally engage in any kind of business
with the Borrower, any other Loan Party or any other affiliate thereof as if it
were any other bank and without any duty to account therefor to the other
Lenders.  Further, the Agent and any
affiliate may accept fees and other consideration from the Borrower for
services in connection with this Agreement and otherwise without having to
account for the same to the other Lenders. 
The Lenders acknowledge that, pursuant to such activities, Wells Fargo
or its affiliates may receive information regarding the Borrower, other Loan
Parties, other Subsidiaries and other Affiliates (including information that
may be subject to confidentiality obligations in favor of such Person) and
acknowledge that the Agent shall be under no obligation to provide such
information to them.

 

Section 12.5.  Approvals of Lenders.

 

All communications from the Agent to any Lender requesting such Lender’s
determination, consent, approval or disapproval (a) shall be given in the
form of a written notice to such Lender, (b) shall be accompanied by a
description of the matter or issue as to which such determination, approval,
consent or disapproval is requested, or shall advise such Lender where
information, if any, regarding such matter or issue may be inspected, or shall
otherwise describe the matter or issue to be resolved, (c) shall include,
if reasonably requested by such Lender and to the extent not previously provided
to such Lender, written materials and a summary of all oral information
provided to the Agent by the Borrower in respect of the matter or issue to be
resolved, and (d) shall include the Agent’s recommended course of action
or determination in respect thereof. 
Unless a Lender shall give written notice to the Agent that it
specifically objects to the recommendation or determination of the Agent
(together with a reasonable written explanation of the reasons behind such objection)
within 10 Business Days (or such lesser period as may be specifically required
under the express terms of the Loan Documents) of receipt of such
communication, such Lender shall be deemed to have conclusively approved of or
consented to such recommendation or determination.

 

Section 12.6.  Lender Credit Decision, Etc.

 

Each Lender expressly acknowledges and agrees that neither the Agent
nor any of its officers, directors, employees, agents, counsel,
attorneys-in-fact or other affiliates has made any representations or
warranties to such Lender and that no act by the Agent hereafter taken,
including any review of the affairs of the Borrower, any other Loan Party or
any other Subsidiary or Affiliate, shall be deemed to constitute any such
representation or warranty by the Agent to any Lender.  Each Lender acknowledges that it has,
independently and without reliance upon the Agent, any other Lender or counsel
to the Agent, or any of their respective officers, directors, employees, agents
or counsel, and based on the financial statements of the Borrower, the other
Loan Parties, the other Subsidiaries and other Affiliates, and inquiries of
such Persons, its

 

83

 

independent due diligence of
the business and affairs of the Borrower, the other Loan Parties, the other
Subsidiaries and other Persons, its review of the Loan Documents, the legal
opinions required to be delivered to it hereunder, the advice of its own
counsel and such other documents and information as it has deemed appropriate,
made its own credit and legal analysis and decision to enter into this
Agreement and the transactions contemplated hereby.  Each Lender also acknowledges that it will,
independently and without reliance upon the Agent, any other Lender or counsel
to the Agent or any of their respective officers, directors, employees and
agents, and based on such review, advice, documents and information as it shall
deem appropriate at the time, continue to make its own decisions in taking or
not taking action under the Loan Documents. 
The Agent shall not be required to keep itself informed as to the
performance or observance by the Borrower or any other Loan Party of the Loan
Documents or any other document referred to or provided for therein or to
inspect the properties or books of, or make any other investigation of, the
Borrower, any other Loan Party or any other Subsidiary.  Except for notices, reports and other
documents and information expressly required to be furnished to the Lenders by the
Agent under this Agreement or any of the other Loan Documents, the Agent shall
have no duty or responsibility to provide any Lender with any credit or other
information concerning the business, operations, property, financial and other
condition or creditworthiness of the Borrower, any other Loan Party or any
other Affiliate thereof which may come into possession of the Agent or any of
its officers, directors, employees, agents, attorneys-in-fact or other
Affiliates.  Each Lender acknowledges
that the Agent’s legal counsel in connection with the transactions contemplated
by this Agreement is only acting as counsel to the Agent and is not acting as
counsel to such Lender.

 

Section 12.7.  Indemnification of Agent.

 

Regardless of whether the transactions contemplated by this Agreement
and the other Loan Documents are consummated, each Lender agrees to indemnify
the Agent (to the extent not reimbursed by the Borrower and without limiting
the obligation of the Borrower to do so) pro rata in accordance with such
Lender’s respective Pro Rata Share, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever which may at any
time be imposed on, incurred by, or asserted against the Agent (in its capacity
as Agent but not as a “Lender”) in any way relating to or arising out of the
Loan Documents, any transaction contemplated hereby or thereby or any action
taken or omitted by the Agent under the Loan Documents (collectively, “Indemnifiable
Amounts”); provided, however, that no Lender shall be liable for any portion of
such Indemnifiable Amounts to the extent resulting from the Agent’s gross
negligence or willful misconduct as determined by a court of competent
jurisdiction in a final, non-appealable judgment provided, however, that no
action taken in accordance with the directions of the Requisite Lenders shall
be deemed to constitute gross negligence or willful misconduct for purposes of
this Section.  Without limiting the
generality of the foregoing, each Lender agrees to reimburse the Agent (to the
extent not reimbursed by the Borrower and without limiting the obligation of
the Borrower to do so) promptly upon demand for its ratable share of any
out-of-pocket expenses (including the reasonable fees and expenses of the
counsel to the Agent) incurred by the Agent in connection with the preparation,
negotiation, execution, administration, or enforcement (whether through
negotiations, legal proceedings, or otherwise) of, or legal advice with respect
to the rights or responsibilities of the parties under, the Loan Documents, any
suit or action brought by the Agent to enforce the terms of the Loan Documents
and/or collect

 

84

 

any Obligations, any “lender
liability” suit or claim brought against the Agent and/or the Lenders, and any
claim or suit brought against the Agent and/or the Lenders arising under any
Environmental Laws.  Such out-of-pocket
expenses (including counsel fees) shall be advanced by the Lenders on the
request of the Agent notwithstanding any claim or assertion that the Agent is
not entitled to indemnification hereunder upon receipt of an undertaking by the
Agent that the Agent will reimburse the Lenders if it is actually and finally determined
by a court of competent jurisdiction that the Agent is not so entitled to
indemnification.  The agreements in this
Section shall survive the payment of the Loans and all other amounts
payable hereunder or under the other Loan Documents and the termination of this
Agreement.  If the Borrower shall
reimburse the Agent for any Indemnifiable Amount following payment by any
Lender to the Agent in respect of such Indemnifiable Amount pursuant to this
Section, the Agent shall share such reimbursement on a ratable basis with each
Lender making any such payment.

 

Section 12.8.  Successor Agent.

 

The Agent may resign at any time as Agent under the Loan Documents by
giving written notice thereof to the Lenders and the Borrower.  The Agent may be removed as Agent under the
Loan Documents for gross negligence or willful misconduct upon 30-day’s prior
written notice by all Lenders (other than the Lender then acting as Agent) and
the Borrower.  Upon any such resignation
or removal, the Requisite Lenders shall have the right to appoint a successor
Agent which appointment shall, provided no Default or Event of Default exists,
be subject to the Borrower’s approval, which approval shall not be unreasonably
withheld or delayed (except that the Borrower shall, in all events, be deemed
to have approved each Lender and any of its affiliates as a successor
Agent).  If no successor Agent shall have
been so appointed in accordance with the immediately preceding sentence, and
shall have accepted such appointment, within 30 days after the resigning Agent’s
giving of notice of resignation or the Lenders’ removal of the resigning or
removed Agent, then the resigning or removed Agent may, on behalf of the
Lenders, appoint a successor Agent, which shall be a Lender, if any Lender
shall be willing to serve, and otherwise shall be an Eligible Assignee.  The current Agent shall continue to act as
Agent hereunder until the earlier of (a) 30 days after the then current
Agent’s resignation or removal or (b) the date on which a successor Agent
is appointed by the Requisite Lenders. 
Upon the acceptance of any appointment as Agent hereunder by a successor
Agent, such successor Agent shall thereupon succeed to and become vested with
all the rights, powers, privileges and duties of the current Agent, and the
current Agent shall be discharged from its duties and obligations under the
Loan Documents.  After any Agent’s
resignation or removal hereunder as Agent, the provisions of this
Article XII. shall continue to inure to its benefit as to any actions
taken or omitted to be taken by it while it was Agent under the Loan
Documents.  Notwithstanding anything
contained herein to the contrary, the Agent may assign its rights and duties
under the Loan Documents to any of its affiliates by giving the Borrower and
each Lender prior written notice provided, however, that regardless of such
assignment by the Agent, the Agent shall be and remain obligated with respect
to this Agreement and the other Loan Documents for all obligations of the “Agent”
hereunder and thereunder.

 

Section 12.9.  Titled Agents.

 

Each Syndication Agent and the Documentation Agent
(each a “Titled Agent”) in each such respective capacity, assumes no
responsibility or obligation hereunder, including, without

 

85

 

limitation, for
servicing, enforcement or collection of any of the Loans, nor any duties as an
agent hereunder for the Lenders.  The
titles given to the Titled Agents are solely honorific and imply no fiduciary
responsibility on the part of the Titled Agents to the Agent, any Lender, the
Borrower or any other Loan Party and the use of such titles does not impose on
the Titled Agents any duties or obligations greater than those of any other
Lender or entitle the Titled Agents to any rights other than those to which any
other Lender is entitled.

 

ARTICLE XIII. MISCELLANEOUS

 

Section 13.1.  Notices.

 

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

 

If to the Borrower:

 

Realty Income Corporation

220 West Crest Street

Escondido, California  92025-1707

Attention:  Legal Department

Telecopy Number:               (760)
741-8674

Telephone Number:             (760)
741-2111

 

If to the Agent or a Lender:

 

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

 

or, as to each party at such other address as shall be designated by
such party in a written notice to the other parties delivered in compliance
with this Section; provided, a Lender shall only be required to give notice of
any such other address to the Agent and the Borrower.  All such notices and other communications
shall be effective (i) if mailed, 72 hours after such notice or
communication is deposited in the mail with appropriate first class postage,
addressed appropriately in accordance with this Section; (ii) if
telecopied, when transmitted; or (iii) if hand delivered, when delivered.  Notwithstanding the immediately preceding
sentence, all notices or communications to the Agent or any Lender under
Article II. shall be effective only when actually received.  Neither the Agent nor any Lender shall incur
any liability to the Borrower (nor shall the Agent incur any liability to the
Lenders) for acting upon any telephonic notice referred to in this Agreement
which the Agent or such Lender, as the case may be, believes in good faith to
have been given by a Person authorized to deliver such notice or for otherwise
acting in good faith hereunder.

 

(b)           Electronic Document
Delivery.  Documents required to be
delivered pursuant to the Loan Documents may be delivered by electronic
communication and delivery, including, the Internet, e-mail or intranet
websites to which the Agent and each Lender have access (including a
commercial, third-party website such as www.Edgar.com
<http://www.Edgar.com> or a website sponsored or hosted by the Agent or
the Borrower); provided, however, that the foregoing shall

 

86

 

not apply to notices to any
Lender (or the Issuing Bank) (i) pursuant to Article II or
(ii) if such Lender has not notified the Agent and the Borrower that such
Lender cannot or does not want to receive electronic communications.  Documents delivered electronically shall be
deemed to have been delivered twenty-four (24) hours after the date and time on
which the Agent or the Borrower posts such documents or the documents become
available on a commercial website and the Agent or the Borrower notifies each
Lender of said posting and provides a link thereto; provided, however,
if such notice or other communication is not sent or posted during the normal
business hours of the recipient, said posting date and time shall be deemed to
have commenced as of  9:00 a.m. on
the opening of business on the next business day for the recipient.  Notwithstanding anything contained herein, in
every instance the Borrower shall be required to provide paper copies of the
certificate required by Section 9.3 to the Agent and shall deliver paper
copies of any documents to the Agent or to any Lender that requests such paper
copies until a written request to cease delivering paper copies is given by the
Agent or such Lender to the Borrower. 
The Agent shall have no obligation to request the delivery of or to
maintain paper copies of any documents delivered electronically, and in no
event shall have any responsibility to monitor compliance by the Borrower with
any such request for delivery.  Each
Lender shall be solely responsible for requesting delivery to it of paper
copies and maintaining its paper or electronic documents.

 

Section 13.2.  Expenses.

 

The Borrower agrees (a) to pay or reimburse the Agent for all of
its reasonable out-of-pocket costs and reasonable expenses incurred in
connection with the preparation, negotiation and execution of, and any
amendment, supplement or modification to, any of the Loan Documents (including
due diligence expense and reasonable travel expenses related to closing), and
the consummation of the transactions contemplated thereby, including the
reasonable fees and disbursements of counsel to the Agent and all costs and expenses of the Agent in
connection with the review of Properties for inclusion in calculations of the
Borrowing Base and the Agent’s other activities under Article IV. and the
reasonable fees and disbursements of counsel to the Agent relating to all such
activities, (b) to pay or reimburse the Agent and the Lenders for
all their costs and expenses incurred in connection with the enforcement or
preservation of any rights under the Loan Documents, including the reasonable
fees and disbursements of their respective counsel (including the allocated
fees and expenses of in-house counsel) and any payments in indemnification or otherwise
payable by the Lenders to the Agent pursuant to the Loan Documents, and
(c)  to the extent not already covered by any of the preceding
subsections, to pay the fees and disbursements of counsel to the Agent and any
Lender incurred in connection with the representation of the Agent or such
Lender in any matter relating to or arising out of any bankruptcy or other
proceeding of the type described in Sections 11.1.(e). or 11.1.(f).,
including, without limitation (i) any motion for relief from any stay or
similar order, (ii) the negotiation, preparation, execution and delivery
of any document relating to the Obligations and (iii) the negotiation and
preparation of any debtor-in-possession financing or any plan of reorganization
of the Borrower or any other Loan Party, whether proposed by the Borrower, such
Loan Party, the Lenders or any other Person, and whether such fees and expenses
are incurred prior to, during or after the commencement of such proceeding or
the confirmation or conclusion of any such proceeding.

 

87

 

Section 13.3.  Stamp, Intangible and Recording Taxes.

 

The Borrower will pay any and all stamp, excise, intangible,
registration, recordation and similar taxes, fees or charges and shall indemnify
the Agent and each Lender against any and all liabilities with respect to or
resulting from any delay in the payment or omission to pay any such taxes, fees
or charges, which may be payable or determined to be payable in connection with
the execution, delivery, recording, performance or enforcement of this
Agreement, the Notes and any of the other Loan Documents, the amendment,
supplement, modification or waiver of or consent under this Agreement, the
Notes or any of the other Loan Documents or the perfection of any rights or
Liens under this Agreement, the Notes or any of the other Loan Documents.

 

Section 13.4.  Setoff.

 

Subject to Section 3.3. and in addition to any rights now or
hereafter granted under Applicable Law and not by way of limitation of any such
rights, the Agent, each Lender and each Participant is hereby authorized by the
Borrower, at any time or from time to time while an Event of Default exists,
without notice to the Borrower or to any other Person, any such notice being
hereby expressly waived, but in the case of a Lender or a Participant subject
to receipt of the prior written consent of the Agent exercised in its sole
discretion, to set off and to appropriate and to apply any and all deposits
(general or special, including, but not limited to, indebtedness evidenced by
certificates of deposit, whether matured or unmatured) and any other
indebtedness at any time held or owing by the Agent, such Lender or any
affiliate of the Agent or such Lender, to or for the credit or the account of
the Borrower against and on account of any of the Obligations, irrespective of
whether or not any or all of the Loans and all other Obligations have been
declared to be, or have otherwise become, due and payable as permitted by
Section 11.2., and although such obligations shall be contingent or
unmatured.

 

Section 13.5.  Litigation; Jurisdiction; Other Matters;
Waivers.

 

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

 

(b)           EACH OF THE BORROWER,
THE AGENT AND EACH LENDER HEREBY AGREES THAT THE FEDERAL DISTRICT COURT OF THE
NORTHERN DISTRICT OF CALIFORNIA OR, AT THE OPTION OF THE AGENT, ANY STATE COURT
LOCATED IN SAN FRANCISCO, CALIFORNIA, SHALL HAVE JURISDICTION TO HEAR AND
DETERMINE ANY CLAIMS OR DISPUTES BETWEEN OR AMONG THE BORROWER,

 

88

 

THE AGENT OR ANY OF THE
LENDERS, PERTAINING DIRECTLY OR INDIRECTLY TO THIS AGREEMENT, THE LOANS AND
LETTERS OF CREDIT, THE NOTES OR ANY OTHER LOAN DOCUMENT OR TO ANY MATTER
ARISING HEREFROM OR THEREFROM.  THE
BORROWER AND EACH OF THE LENDERS EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO
SUCH JURISDICTION IN ANY ACTION OR PROCEEDING COMMENCED IN SUCH COURTS.  THE BORROWER HEREBY WAIVES PERSONAL SERVICE
OF THE SUMMONS AND COMPLAINT, OR OTHER PROCESS OR PAPERS ISSUED THEREIN, AND
AGREES THAT SERVICE OF SUCH SUMMONS AND COMPLAINT, OR OTHER PROCESS OR PAPERS
MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO THE BORROWER AT
ITS ADDRESS FOR NOTICES PROVIDED FOR HEREIN. 
SHOULD THE BORROWER FAIL TO APPEAR OR ANSWER ANY SUMMONS, COMPLAINT,
PROCESS OR PAPERS SO SERVED WITHIN THIRTY DAYS AFTER THE MAILING THEREOF, THE
BORROWER SHALL BE DEEMED IN DEFAULT AND AN ORDER AND/OR JUDGMENT MAY BE
ENTERED AGAINST IT AS DEMANDED OR PRAYED FOR IN SUCH SUMMONS, COMPLAINT,
PROCESS OR PAPERS.  EACH PARTY FURTHER
WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY
SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR PROCEEDING
WAS BROUGHT IN AN INCONVENIENT FORUM AND EACH AGREES NOT TO PLEAD OR CLAIM THE
SAME.  THE CHOICE OF FORUM SET FORTH IN
THIS SECTION SHALL NOT BE DEEMED TO PRECLUDE THE BRINGING OF ANY ACTION BY
THE AGENT OR ANY LENDER OR THE ENFORCEMENT BY THE AGENT OR ANY LENDER OF ANY
JUDGMENT OBTAINED IN SUCH FORUM IN ANY OTHER APPROPRIATE JURISDICTION.

 

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

 

Section 13.6.  Successors and Assigns.

 

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

 

(b)           Participations.  Any Lender may at any time grant to an
affiliate of such Lender, or one or more banks or other financial institutions
(each a “Participant”) participating interests in its Commitment or the
Obligations owing to such Lender.  Except
as otherwise provided in Section 13.4., no Participant shall have any
rights or benefits under this Agreement or any other Loan Document.  In the event of any such grant by a Lender of
a participating interest to a Participant, such Lender shall remain responsible
for the performance of it obligations hereunder,

 

89

 

and the Borrower and the Agent
shall continue to deal solely and directly with such Lender in connection with
such Lender’s rights and obligations under this Agreement.  Any agreement pursuant to which any Lender
may grant such a participating interest shall provide that such Lender shall
retain the sole right and responsibility to enforce the obligations of the
Borrower hereunder including, without limitation, the right to approve any
amendment, modification or waiver of any provision of this Agreement; provided
however, such Lender may agree with the Participant that it will not, without
the consent of the Participant, agree to (i) increase such Lender’s
Commitment, (ii) extend the date fixed for the payment of principal on the
Loans or portions thereof owing to such Lender, or (iii) reduce the rate
at which interest is payable thereon.  An
assignment or other transfer which is not permitted by
subsection (c) or (d) below shall be given effect for purposes
of this Agreement only to the extent of a participating interest granted in
accordance with this subsection (b).

 

(c)           Assignments.  Any Lender may with the prior written consent
of the Agent and the Borrower (which consent in each case, shall not be
unreasonably withheld) at any time assign to one or more Eligible Assignees
(each an “Assignee”) all or a portion of its rights and obligations under this
Agreement and the Notes; provided, however, (i) no such consent by the
Borrower shall be required (x) if a Default or Event of Default shall
exist or (y) in the case of an assignment to another Lender or an
affiliate of another Lender; (ii) any partial assignment shall be in an
amount at least equal to $10,000,000 and after giving effect to such assignment
the assigning Lender retains a Commitment, or if the Commitments have been
terminated, holds Notes having an aggregate outstanding principal balance, of
at least $10,000,000; (iii) after giving effect to any such assignment by
the Agent, the Agent in its capacity as a Lender shall retain a Commitment of
at least 10% of the Commitments at such time, or if the Commitments have been
terminated, hold Notes having an aggregate outstanding principal balance of at
least 10% of the total principal balance of the Notes (other than Bid Rate
Notes) outstanding at such time; provided, however, that if the Agent desires
to reduce its Commitment below the 10% level the Agent shall offer to resign as
Agent with such resignation only effective upon the approval of such offer by
the Requisite Lenders (other than the Lender then acting as Agent); and
(iv) each such assignment shall be effected by means of an Assignment and
Assumption Agreement.  Upon execution and
delivery of such instrument and payment by such Assignee to such transferor
Lender of an amount equal to the purchase price agreed between such transferor
Lender and such Assignee, such Assignee shall be deemed to be a Lender party to
this Agreement and shall have all the rights and obligations of a Lender with a
Commitment as set forth in such Assignment and Assumption Agreement, and the
transferor Lender shall be released from its obligations hereunder to a
corresponding extent, and no further consent or action by any party shall be
required.  Upon the consummation of any
assignment pursuant to this subsection (c), the transferor Lender, the
Agent and the Borrower shall make appropriate arrangement so the new Notes are
issued to the Assignee and such transferor Lender, as appropriate and such
transferor Lender shall promptly deliver after such assignment its cancelled
Notes to Borrower.  In connection with
any such assignment, the transferor Lender shall pay to the Agent an
administrative fee for processing such assignment in the amount of $3,000.  Anything in this Section to the contrary
notwithstanding, no Lender may assign or participate any interest in any Loan
held by it hereunder to the Borrower, or any of its respective affiliates or
Subsidiaries.

 

90

 

(d)           Designated Lenders.  Any Lender (each, a “Designating Lender”) may
at any time while the Borrower or the Parent, as the case may be, has been
assigned an Investment Grade Rating from either S&P or Moody’s designate
one Designated Lender to fund Bid Rate Loans on behalf of such Designating
Lender subject to the terms of this subsection (d) and the provisions
in the immediately preceding subsections (b) and (c) shall not
apply to such designation.  No Lender may
designate more than one Designated Lender. 
The parties to each such designation shall execute and deliver to the
Agent for its acceptance a Designation Agreement.  Upon such receipt of an appropriately
completed Designation Agreement executed by a Designating Lender and a designee
representing that it is a Designated Lender, the Agent will accept such
Designation Agreement and give prompt notice thereof to the Borrower,
whereupon, (i) the Borrower shall execute and deliver to the Designating
Lender a Designated Lender Note payable to the order of the Designated Lender,
(ii) from and after the effective date specified in the Designation
Agreement, the Designated Lender shall become a party to this Agreement with a
right to make Bid Rate Loans on behalf of its Designating Lender pursuant to
Section 2.2. after the Borrower has accepted a Bid Rate Loan (or portion
thereof) of the Designating Lender, and (iii) the Designated Lender shall
not be required to make payments with respect to any obligations in this
Agreement except to the extent of excess cash flow of such Designated Lender
which is not otherwise required to repay obligations of such Designated Lender
which are then due and payable; provided, however, that regardless of such
designation and assumption by the Designated Lender, the Designating Lender
shall be and remain obligated to the Borrower, the Agent and the Lenders for
each and every of the obligations of the Designating Lender and its related
Designated Lender with respect to this Agreement, including, without
limitation, any indemnification obligations under Section 12.7. and any
sums otherwise payable to the Borrower by the Designated Lender.  Each Designating Lender shall serve as the
Agent of the Designated Lender and shall on behalf of, and to the exclusion of,
the Designated Lender: (i) receive any and all payments made for the
benefit of the Designated Lender and (ii) give and receive all
communications and notices and take all actions hereunder, including, without
limitation, votes, approvals, waivers, consents and amendments under or
relating to this Agreement and the other Loan Documents.  Any such notice, communication, vote,
approval, waiver, consent or amendment shall be signed by the Designating
Lender as Agent for the Designated Lender and shall not be signed by the
Designated Lender on its own behalf and shall be binding on the Designated
Lender to the same extent as if signed by the Designated Lender on its own
behalf.  The Borrower, the Agent and the
Lenders may rely thereon without any requirement that the Designated Lender
sign or acknowledge the same.  No
Designated Lender may assign or transfer all or any portion of its interest
hereunder or under any other Loan Document, other than assignments to the
Designating Lender which originally designated such Designated Lender.  The Borrower, the Lenders and the Agent each
hereby agrees that it will not institute against any Designated Lender or join
any other Person in instituting against any Designated Lender any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceeding under any
federal or state bankruptcy or similar law, until the later to occur of
(x) one year and one day after the payment in full of the latest maturing
commercial paper note issued by such Designated Lender and (y) the
Termination Date.  In connection with any
such designation the Designating Lender shall pay to the Agent an
administrative fee for processing such designation in the amount of $2,000.

 

91

 

(e)           Federal Reserve Bank
Assignments.  In addition to the
assignments and participations permitted under the foregoing provisions of the
Section, and without the need to comply with any of the formal or procedural
requirements of this Section, any Lender may at any time and from time to time,
pledge and assign all or any portion of its rights under all or any of the Loan
Documents to a Federal Reserve Bank; provided that no such pledge or assignment
shall release such assigning Lender from its obligation thereunder.

 

(f)            Information to
Assignee, Etc.  A Lender may furnish
any information concerning the Borrower, any Subsidiary or any other Loan Party
in the possession of such Lender from time to time to Assignees and
Participants (including prospective Assignees and Participants).

 

Section 13.7.  Amendments and Waivers.

 

(a)           Generally.  Except as
otherwise expressly provided in this Agreement, (i) any consent or
approval required or permitted by this Agreement or in any Loan Document to be
given by the Lenders may be given, (ii) any term of this Agreement or of
any other Loan Document (other than any fee letter solely between the Borrower
and the Agent) may be amended, (iii) the performance or observance by the
Borrower or any other Loan Party of any terms of this Agreement or such other
Loan Document (other than any fee letter solely between the Borrower and the
Agent), and (iv) the continuance of any Default or Event of Default may be
waived (either generally or in a particular instance and either retroactively
or prospectively) with, but only with, the written consent of the Requisite
Lenders (or the Agent at the written direction of the Requisite Lenders), and,
in the case of an amendment to any Loan Document, the written consent of each
Loan Party which is party thereto. 
Notwithstanding the previous sentence, the Agent, shall be authorized on
behalf of all the Lenders to use its reasonable discretion, without the
necessity of any notice to, or further consent from, any Lender, to waive the
imposition of the late charges provided in Section 2.8., up to a maximum of 2 times per
calendar year.

 

(b)           Certain
Requisite Lender Consents. 
Notwithstanding the foregoing, no amendment, waiver or consent
shall, unless in writing, and signed by the Requisite Lenders (which must
include the Lender then acting as Agent), do any of the following:

 

(i)            amend
Section 10.1. or waive any Default or Event of Default occurring under
Section 11.1.(l); or

 

(ii)           modify
the definitions of the terms “Total Liabilities”, “Gross Asset Value” or “Indebtedness”
(or the definitions used in such definition or the percentages or rates used in
the calculation thereof); or

 

(iii)          approve
any Unencumbered Pool Property pursuant to Section 4.1.(c); or

 

(iv)          rescind
and annul any acceleration as provided in
Section 11.2.(e) (including, without limitation, any optional
acceleration declared by the Agent and Requisite Lenders pursuant to
Section 11.1.(a)(ii)).

 

92

 

(c)           Unanimous
Consent.  Notwithstanding
the foregoing, no amendment, waiver or consent shall, unless in writing, and
signed by all of the Lenders (or the Agent at the written direction of the
Lenders), do any of the following:

 

(i)            increase
the Commitments of the Lenders (excluding any increase as a result of an
assignment of Commitments permitted under Section 13.6.) or subject the Lenders to any additional
obligations except for any increases contemplated under Section 2.15.;

 

(ii)           reduce
the principal of, or interest rates that have accrued or that will be charged
on the outstanding principal amount of, any Loans or other Obligations;

 

(iii)          reduce
the amount of any Fees payable to the Lenders hereunder;

 

(iv)          postpone
any date fixed for any payment of principal of, or interest on, any Loans or
for the payment of Fees or any other Obligations;

 

(v)           change
the Pro Rata Shares (excluding any change as a result of an assignment of
Commitments permitted under Section 13.6. or an increase of Commitments
effected pursuant to Section 2.15.);

 

(vi)          amend
this Section or amend the definitions of the terms used in this Agreement
or the other Loan Documents insofar as such definitions affect the substance of
this Section;

 

(vii)         modify
the definition of the term “Requisite Lenders” or modify in any other manner
the number or percentage of the Lenders required to make any determinations or
waive any rights hereunder or to modify any provision hereof;

 

(viii)        release
any Guarantor from its obligations under the Guaranty (except for releases
permitted under Sections 8.14.);

 

(ix)           modify
the definition of the terms  “Maximum
Loan Availability” or “Unencumbered Pool Value” (and the definitions used in
such definitions and the percentages and rates used in the calculation
thereof); or

 

(x)            waive
a Default or Event of Default under Section 11.1.(a).

 

(d)           Amendment of Agent’s
Duties, Etc.  No amendment, waiver or
consent unless in writing and signed by the Agent, in addition to the Lenders
required hereinabove to take such action, shall affect the rights or duties of
the Agent under this Agreement or any of the other Loan Documents.  Any amendment, waiver or consent relating to
Section 2.3. or the obligations of the Swingline Lender under this
Agreement or any other Loan Document shall, in addition to the Lenders required
hereinabove to take such action, require the written consent of the Swingline
Lender.  No waiver shall extend to or
affect any obligation not expressly waived or impair any right consequent
thereon and any amendment, waiver or consent shall be effective

 

93

 

only in the specific instance
and for the specific purpose set forth therein. 
No course of dealing or delay or omission on the part of the Agent or
any Lender in exercising any right shall operate as a waiver thereof or
otherwise be prejudicial thereto.  Any Event of Default occurring hereunder shall
continue to exist until such time as such Event of Default is waived in writing
in accordance with the terms of this Section, notwithstanding any attempted
cure or other action by the Borrower, any other Loan Party or any other Person
subsequent to the occurrence of such Event of Default.  Except as otherwise explicitly provided for
herein or in any other Loan Document, no notice to or demand upon the Borrower
shall entitle the Borrower to other or further notice or demand in similar or
other circumstances.

 

Section 13.8.  Nonliability of Agent and Lenders.

 

The relationship between the Borrower, on the one hand, and the Lenders
and the Agent, on the other hand, shall be solely that of borrower and
lender.  Neither the Agent nor any Lender
shall have any fiduciary responsibilities to the Borrower and no provision in
this Agreement or in any of the other Loan Documents, and no course of dealing
between or among any of the parties hereto, shall be deemed to create any
fiduciary duty owing by the Agent or any Lender to any Lender, the Borrower,
any Subsidiary or any other Loan Party. 
Neither the Agent nor any Lender undertakes any responsibility to the
Borrower to review or inform the Borrower of any matter in connection with any
phase of the Borrower’s business or operations.

 

Section 13.9.  Confidentiality.

 

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

 

Section 13.10.  Indemnification.

 

(a)           The Borrower shall and
hereby agrees to indemnify, defend and hold harmless the Agent, any affiliate
of the Agent and each of the Lenders and their respective directors, officers,
shareholders, agents, employees and counsel (each referred to herein as an “Indemnified
Party”)

 

94

 

from and against any and all
losses, costs, claims, damages, liabilities, deficiencies, judgments or
expenses of every kind and nature (including, without limitation, amounts paid
in settlement, court costs and the fees and disbursements of counsel incurred
in connection with any litigation, investigation, claim or proceeding or any
advice rendered in connection therewith, but excluding losses, costs, claims,
damages, liabilities, deficiencies, judgments or expenses indemnification in
respect of which is specifically covered by Section 3.11. or 5.1. or
expressly excluded from the coverage of such Sections) incurred by an
Indemnified Party in connection with, arising out of, or by reason of, any
suit, cause of action, claim, arbitration, investigation or settlement, consent
decree or other proceeding (the foregoing referred to herein as an “Indemnity Proceeding”)
which is in any way related directly or indirectly to: (i) this Agreement
or any other Loan Document or the transactions contemplated thereby;
(ii) the making of any Loans hereunder; (iii) any actual or proposed
use by the Borrower of the proceeds of the Loans; (iv) the Agent’s or any
Lender’s entering into this Agreement; (v) the fact that the Agent and the
Lenders have established the credit facility evidenced hereby in favor of the
Borrower; (vi) the fact that the Agent and the Lenders are creditors of
the Borrower and have or are alleged to have information regarding the
financial condition, strategic plans or business operations of the Borrower and
the Subsidiaries; (vii) the fact that the Agent and the Lenders are
material creditors of the Borrower and are alleged to influence directly or
indirectly the business decisions or affairs of the Borrower and the
Subsidiaries or their financial condition; (viii) the exercise of any
right or remedy the Agent or the Lenders may have under this Agreement or the
other Loan Documents; provided, however, that the Borrower shall not be
obligated to indemnify any Indemnified Party for any acts or omissions of such
Indemnified Party in connection with matters described in this
clause (viii) that constitute gross negligence or willful misconduct
of such Indemnified Party; or (ix) any violation or non-compliance by the
Borrower or any Subsidiary of any Applicable Law (including any Environmental
Law) including, but not limited to, any Indemnity Proceeding commenced by
(A) the Internal Revenue Service or state taxing authority or (B) any
Governmental Authority or other Person under any Environmental Law, including
any Indemnity Proceeding commenced by a Governmental Authority or other Person
seeking remedial or other action to cause the Borrower or its Subsidiaries (or
its respective properties) (or the Agent and/or the Lenders as successors to
the Borrower) to be in compliance with such Environmental Laws.

 

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

 

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

 

95

 

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

 

(e)           An Indemnified Party
may conduct its own investigation and defense of, and may formulate its own
strategy with respect to, any Indemnity Proceeding covered by this
Section and, as provided above, all costs and expenses incurred by such
Indemnified Party shall be reimbursed by the Borrower.  No action taken by legal counsel chosen by an
Indemnified Party in investigating or defending against any such Indemnity
Proceeding shall vitiate or in any way impair the obligations and duties of the
Borrower hereunder to indemnify and hold harmless each such Indemnified Party;
provided, however, that (i) if the Borrower is required to indemnify an
Indemnified Party pursuant hereto and (ii) the Borrower has provided
evidence reasonably satisfactory to such Indemnified Party that the Borrower
has the financial wherewithal to reimburse such Indemnified Party for any
amount paid by such Indemnified Party with respect to such Indemnity
Proceeding, such Indemnified Party shall not settle or compromise any such
Indemnity Proceeding without the prior written consent of the Borrower (which
consent shall not be unreasonably withheld or delayed).

 

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

 

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

 

Section 13.11.  Termination; Survival.

 

At such time as (a) all of the Commitments have been terminated,
(b) none of the Lenders is obligated any longer under this Agreement to
make any Loans and (c) all Obligations (other than obligations which
survive as provided in the following sentence) have been paid and satisfied in
full, this Agreement shall terminate. The indemnities to which the Agent and
the Lenders are entitled under the provisions of Sections 3.11., 5.1.,
5.4., 12.7., 13.2. and 13.10. and any other provision of this Agreement and the
other Loan Documents, and the provisions of Section 13.5., shall continue
in full force and effect and shall protect the Agent and the Lenders
(i) notwithstanding any termination of this Agreement, or of the other
Loan Documents, against events arising after such termination as well as before
and (ii) at all times after any such party ceases to be a party to this
Agreement with respect to all matters and events existing on or prior to the
date such party ceased to be a party to this Agreement.

 

96

 

Section 13.12.  Severability of Provisions.

 

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

 

Section 13.13.  GOVERNING LAW.

 

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

 

Section 13.14.  USA Patriot Act Notice; Compliance.

 

The USA Patriot Act of 2001 (Public Law 107-56) and federal regulations
issued with respect thereto require all financial institutions to obtain,
verify and record certain information that identifies individuals or business
entities which open an “account” with such financial institution.  Consequently, the Agent (for itself and/or as
agent for all Lenders hereunder) may from time-to-time request, and Borrower
shall provide to the Agent, Borrower’s name, address, tax identification number
and/or such other identification information as shall be necessary for the
Agent to comply with federal law.  An “account”
for this purpose may include, without limitation, a deposit account, cash
management service, a transaction or asset account, a credit account, a loan or
other extension of credit, and/or other financial services product.

 

Section 13.15.  Counterparts.

 

This Agreement and any amendments, waivers, consents or supplements may
be executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed and delivered shall be
deemed an original, but all of which counterparts together shall constitute but
one and the same instrument.

 

Section 13.16.  Obligations with Respect to Loan Parties.

 

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

 

Section 13.17.  Independence of Covenants.

 

All covenants hereunder shall be given in any jurisdiction independent
effect so that if a particular action or condition is not permitted by any of
such covenants, the fact that it would be permitted by an exception to, or be
otherwise within the limitations of, another covenant shall not avoid the
occurrence of a Default or an Event of Default if such action is taken or
condition exists.

 

97

 

Section 13.18.  Limitation of Liability.

 

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

 

Section 13.19.  Entire Agreement.

 

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

 

Section 13.20.  Construction.

 

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

 

Section 13.21.  No Novation.

 

THE PARTIES HERETO HAVE ENTERED INTO THIS AGREEMENT
SOLELY TO AMEND AND RESTATE THE TERMS OF THE EXISTING CREDIT AGREEMENT.  THE PARTIES DO NOT INTEND THIS AGREEMENT NOR
THE TRANSACTIONS CONTEMPLATED HEREBY TO BE, AND THIS AGREEMENT AND THE TRANSACTIONS
CONTEMPLATED HEREBY SHALL NOT BE CONSTRUED TO BE, A NOVATION OF ANY OF THE
OBLIGATIONS OWING BY THE BORROWER UNDER OR IN CONNECTION WITH THE EXISTING
CREDIT AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS (AS DEFINED IN THE EXISTING
CREDIT AGREEMENT).

 

[Signatures on Following Pages]

 

98

 

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

 

 

	
   

  	
  BORROWER:

  
	
   

  	
   

  	
   

  
	
   

  	
  REALTY INCOME CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
					

 

 

[Signatures Continued on Next Page]

 

99

 

Signature Page to Credit Agreement dated
as of

             ,
2005 with Realty Income Corporation

 

	
   

  	
  WELLS FARGO BANK, NATIONAL ASSOCIATION,
  as Agent, as a

  
	
   

  	
  Lender and as Swingline Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Commitment Amount:

  
	
   

  	
   

  	
   

  
	
   

  	
  $80,000,000

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Lending Office (all Types of Loans) and

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  	
   

  
	
   

  	
  401 B Street, Suite 304

  
	
   

  	
  San Diego, CA 92101

  
	
   

  	
  Attn: Cara D’Angelo

  
	
   

  	
  Telecopier:

  	
  (619) 699-3105

  
	
   

  	
  Telephone:

  	
  (619) 699-3025

  
								

 

 

[Signatures Continued on Next Page]

 

100

 

Signature Page to Credit Agreement dated
as of

              ,
2005 with Realty Income Corporation

 

	
   

  	
  THE BANK OF NEW YORK, as Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Commitment Amount:

  
	
   

  	
   

  
	
   

  	
  $40,000,000

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lending Office (all Types of Loans) and

  
	
   

  	
  Address for Notices Relating to Funding:

  
	
   

  	
   

  
	
   

  	
  One Wall Street, 22nd Floor

  
	
   

  	
  New York, NY 10005

  
	
   

  	
  Attn: Dawn Hertling

  
	
   

  	
  Telecopier:

  	
  (212) 635-6399

  
	
   

  	
  Telephone:

  	
  (212) 635-6742

  
	
   

  	
   

  
	
   

  	
  Address for Notices Relating to All Other
  Matters:

  
	
   

  	
   

  
	
   

  	
  10990 Wilshire Blvd, Ste 1125

  
	
   

  	
  Los Angeles, CA 90024

  
	
   

  	
  Attn: Elizabeth Ying

  
	
   

  	
  Telecopier:

  	
  (310) 996-8667

  
	
   

  	
  Telephone:

  	
  (310) 996-8661

  
								

 

101

 

Signature Page to Credit Agreement dated
as of

                ,
2005 with Realty Income Corporation

 

	
   

  	
  BANK OF AMERICA, NA, as Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Commitment Amount:

  
	
   

  	
   

  
	
   

  	
  $40,000,000

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lending Office (all Types of Loans) and

  
	
   

  	
  Address for Notices Relating to Funding:

  
	
   

  	
   

  
	
   

  	
  901 Main Street, 14th Floor

  
	
   

  	
  Dallas, TX 75202

  
	
   

  	
  Attn: Alan Tapley

  
	
   

  	
  Telecopier:

  	
  (214) 209-9419

  
	
   

  	
  Telephone:

  	
  (214) 209-0993

  
	
   

  	
   

  
	
   

  	
  Address for Notices Relating to All Other
  Matters:

  
	
   

  	
   

  
	
   

  	
  901 Main Street, 64th Floor

  
	
   

  	
  Dallas, TX 75202

  
	
   

  	
  Attn: Steven P. Renwick

  
	
   

  	
  Telecopier:

  	
  (214) 209-9390

  
	
   

  	
  Telephone:

  	
  (214) 209-1867

  
								

 

102

 

Signature Page to Credit Agreement dated
as of

                ,
2005 with Realty Income Corporation

 

	
   

  	
  WACHOVIA BANK, NATIONAL ASSOCIATION, as Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Commitment Amount:

  
	
   

  	
   

  
	
   

  	
  $40,000,000

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lending Office (all Types of Loans) and

  
	
   

  	
  Address for Notices Relating to Funding:

  
	
   

  	
   

  
	
   

  	
  201 South College Street

  
	
   

  	
  CP9, NC1183

  
	
   

  	
  Charlotte, NC 28288

  
	
   

  	
  Attn: Sharon Holman

  
	
   

  	
  Telecopier:

  	
  (704) 715-0094

  
	
   

  	
  Telephone:

  	
  (704) 715-7608

  
	
   

  	
   

  
	
   

  	
  Address for Notices Relating to All Other
  Matters:

  
	
   

  	
   

  
	
   

  	
  301 South College Street

  
	
   

  	
  NC0172

  
	
   

  	
  Charlotte, NC 28288

  
	
   

  	
  Attn: Rex Rudy

  
	
   

  	
  Telecopier:

  	
  (704) 383-6205

  
	
   

  	
  Telephone:

  	
  (704) 383-6506

  
								

 

103

 

Signature Page to Credit Agreement dated
as of

               ,
2005 with Realty Income Corporation

 

	
   

  	
  AMSOUTH BANK, as Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Commitment Amount:

  
	
   

  	
   

  
	
   

  	
  $25,000,000

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lending Office (all Types of Loans) and

  
	
   

  	
  Address for Notices Relating to Funding:

  
	
   

  	
   

  
	
   

  	
  1900 5th Avenue North

  
	
   

  	
  Birmingham, AL 35203

  
	
   

  	
  Attn: Crystal Cassels

  
	
   

  	
  Telecopier:

  	
  (205) 326-4075

  
	
   

  	
  Telephone:

  	
  (205) 581-7645

  
	
   

  	
   

  
	
   

  	
  Address for Notices Relating to All Other
  Matters:

  
	
   

  	
   

  
	
   

  	
  1900 5th Avenue North

  
	
   

  	
  Birmingham, AL 35203

  
	
   

  	
  Attn: Lee Surtees

  
	
   

  	
  Telecopier:

  	
  (205) 326-4075

  
	
   

  	
  Telephone:

  	
  (205) 801-0621

  
								

 

104

 

Signature Page to Credit Agreement dated
as of

                ,
2005 with Realty Income Corporation

 

	
   

  	
  BANK OF MONTREAL, as Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Commitment Amount:

  
	
   

  	
   

  
	
   

  	
  $25,000,000

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lending Office (all Types of Loans) and

  
	
   

  	
  Address for Notices Relating to Funding:

  
	
   

  	
   

  
	
   

  	
  115 South LaSalle Street, 17W

  
	
   

  	
  Chicago, IL 60603

  
	
   

  	
  Attn: DebraAnn Delaney

  
	
   

  	
  Telecopier:

  	
  (312) 461-5283

  
	
   

  	
  Telephone:

  	
  (312) 293-6910

  
	
   

  	
   

  
	
   

  	
  Address for Notices Relating to All Other
  Matters:

  
	
   

  	
   

  
	
   

  	
  115 South LaSalle Street, 10W

  
	
   

  	
  Chicago, IL 60603

  
	
   

  	
  Attn: Greg Steele

  
	
   

  	
  Telecopier:

  	
  (312) 383-6205

  
	
   

  	
  Telephone:

  	
  (312) 383-6506

  
									

 

105

 

Signature Page to Credit Agreement dated
as of

               ,
2005 with Realty Income Corporation

 

	
   

  	
  CHEVY CHASE BANK, F.S.B., as Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Commitment Amount:

  
	
   

  	
   

  
	
   

  	
  $25,000,000

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lending Office (all Types of Loans) and

  
	
   

  	
  Address for Notices Relating to Funding:

  
	
   

  	
   

  
	
   

  	
  14601 Sweitzer Lane

  
	
   

  	
  Laurel, MD 20707

  
	
   

  	
  Attn: Doris Lakkis

  
	
   

  	
  Telecopier:

  	
  (301) 939-6959

  
	
   

  	
  Telephone:

  	
  (301) 939-6986

  
	
   

  	
   

  
	
   

  	
  Address for Notices Relating to All Other
  Matters:

  
	
   

  	
   

  
	
   

  	
  7501 Wisconsin Avenue, 12th Floor

  
	
   

  	
  Bethesda, MD 20814

  
	
   

  	
  Attn: Sadhvi K. Subramanian

  
	
   

  	
  Telecopier: (240) 497-7714

  
	
   

  	
  Telephone: (240) 497-7702

  
								

 

106

 

Signature Page to Credit Agreement dated
as of

              ,
2005 with Realty Income Corporation

 

	
   

  	
  U.S. BANK NATIONAL ASSOCIATION, as Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Commitment Amount:

  
	
   

  	
   

  
	
   

  	
  $25,000,000

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lending Office (all Types of Loans) and

  
	
   

  	
  Address for Notices Relating to Funding:

  
	
   

  	
   

  
	
   

  	
  4330 La Jolla Village Drive,
  Suite 200

  
	
   

  	
  San Diego, CA 92122

  
	
   

  	
  Attn: Marcy Marlow / Lancy Kim

  
	
   

  	
  Telecopier:

  	
  (503) 275-8181 / (858) 642-4641

  
	
   

  	
  Telephone:

  	
  (503) 275-4824 / (858) 642-4635

  
	
   

  	
   

  
	
   

  	
  Address for Notices Relating to All Other
  Matters:

  
	
   

  	
   

  
	
   

  	
  4330 La Jolla Village Drive,
  Suite 200

  
	
   

  	
  San Diego, CA 92122

  
	
   

  	
  Attn: Chris Elmendorf

  
	
   

  	
  Telecopier:

  	
  (858) 642-4641

  
	
   

  	
  Telephone:

  	
  (858) 642-4632

  
								

 

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