Document:

Exhibit
      10.2

     

    AMENDMENT
      NO. 1 TO FORBEARANCE AGREEMENT

     

    AMENDMENT
      NO. 1 (the “Amendment”), dated as of February 14, 2008, to the
      Forbearance Agreement (the “Agreement”)1 dated as of January 16,
      2008 by and among
      Tekni-Plex, Inc. (the “Company”), each of the Company’s subsidiaries
      identified on the signature pages thereof (the “Subsidiaries”), the
      Holders of the Company’s 12 3/4% Senior Subordinated Notes due 2010 (the
“Notes”) that were issued pursuant to that certain Indenture, dated as of
      June 21, 2000 (as supplemented on May 6, 2002, August 22, 2002, and April 25,
      2005, the “Indenture”), that are signatories thereto (each a
“Noteholder,” and collectively, the “Noteholders,” and together
      with the Company, the “Parties”) and U.S. Bank National Association,
      as
      successor indenture trustee (the “Indenture Trustee”) under the
      Indenture.

     

    RECITALS

     

    WHEREAS,
      the parties hereto are desirous of extending the Agreement on the terms set
      forth herein;

     

    WHEREAS,
      the Noteholders continue to collectively hold not less than $286,650,000 in
      aggregate principal amount of the Notes, representing not less than 91% of
      the
      aggregate principal amount of the Notes that are outstanding, and not less
      than
      $184,250,000 in aggregate principal amount of the Second Lien Notes,
      representing not less than 67% of the aggregate principal amount of the Second
      Lien Notes that are outstanding.

     

     
      
        

      

    

    
      1 
Each
        capitalized term used but not
        defined herein shall have the meaning ascribed to it in the Agreement (and
        to
        the extent not defined therein, the meaning ascribed to it in the
        Indenture).

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    NOW
      THEREFORE, in consideration of the premises and the respective covenants and
      agreements set forth in this Agreement, the Parties, each intending to be
      legally bound, agree as follows:

     

    1.  Forbearance.  Section
      1(c) of the Agreement is hereby amended and restated in its entirety as
      follows:

     

    “(c)  As
      used herein, the term “Forbearance Period” shall mean the period
      beginning on January 17, 2008 and ending upon the occurrence of a Termination
      Event.  As used herein, “Termination Event” shall mean the
      earliest to occur of (i) March 17, 2008; (ii) four Business Days after the
      delivery by Paul, Weiss, as counsel to the Noteholder Group, to the Company
      and
      the Indenture Trustee of a written notice terminating the Forbearance Period
      (the “Termination Notice”), which notice may be delivered at any time but
      only upon or after the occurrence of any Forbearance Default (as defined below);
      provided, however, that notwithstanding the foregoing, this
      Agreement shall immediately terminate upon the occurrence of a Forbearance
      Default under subsection (G) below, without the need for delivery of the
      Termination Notice or any other notice.  As used herein, the term
“Forbearance Default” shall mean: (A) the valid acceleration of
      obligations arising under (i) the 8 3/4% Senior Secured Notes due 2013 (the
      “Second Lien Notes”) issued pursuant to that certain indenture dated as
      of November 21, 2003 (the “Second Lien Indenture”); (ii) the 10 7/8 %
      Senior Secured Notes due 2012 (the “First Lien Notes”) issued pursuant to
      that certain indenture dated as of June 10, 2005 (the “First Lien
      Indenture”); or (iii) the Credit Agreement dated as of June 10, 2005,
      between the Company, as borrower, Citicorp USA, Inc. as administrative

     

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

     

    agent,
      General Electric Capital Corporation as syndication agent, and the lenders
      and
      issuers party thereto (as amended, restated, supplemented or otherwise modified
      from time to time, the “Credit Agreement”); (B) the Company’s payment of
      or entry into an agreement to pay the fees or expenses of any ad-hoc group
      of
      holders of First Lien Notes or Second Lien Notes (other than the Noteholder
      Group); (C) the failure of the Company, after four business days’ written notice
      from Paul, Weiss, Rifkind, Wharton & Garrison LLP (“Paul Weiss”,
      together with Houlihan, Lokey, Howard & Zukin Capital, Inc. (“Houlihan
      Lokey”), the “Advisors”) as counsel to the Noteholder Group alleging
      such a failure, to (i) engage in good faith negotiations with the Noteholder
      Group regarding a potential restructuring transaction, which determination
      shall
      be made by the holders of a majority in principal amount of the Notes in good
      faith and their reasonable discretion or (ii) engage in good faith efforts
      to
      produce documentation and due diligence materials reasonably requested by the
      Advisors, which determination shall be made by the holders of a majority in
      principal amount of the Notes in good faith and their reasonable discretion;
      (D)
      the occurrence of any Event of Default other than the Interest Default; (E)
      the
      failure of the Company to comply with any material term, condition, covenant
      or
      agreement set forth in this Agreement; (F) the failure of any representation
      or
      warranty made by the Company under this Agreement to be true and correct in
      all
      material respects as of the date when made; (G) the commencement by or against
      the Company or any Subsidiary that is a Significant Subsidiary as defined in
      the
      Indenture of a case under title 11 of the United States Code; (H) the Company
      engages in any material asset sales (other than the disposition of inventory),
      material sale-leaseback, or material financing transaction (including any
      increase in commitment under the Credit Agreement) without 

     

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    the
      consent of a majority in principal amount of the Notes held by the Noteholder
      Group; (I) the Company pays any management, sponsor or consulting fees to its
      preferred stockholders or their affiliates; (J) from and after February 14,
      2008, the Company enters into any material amendment, restatement, supplement
      or
      modification to or under the Credit Agreement without the consent of a majority
      in principal amount of the Notes held by the Noteholder Group (except to the
      extent that such requirement that the Company obtain such consent would violate
      Section 6.8 of the Credit Agreement); or (K) the failure of the Company to
      deliver to the Advisors on or before February 22, 2008 a preliminary valuation
      report prepared by Rothschild Inc.”

     

    2.  Limitation
      on and Notice of Transfers of Notes.  Section 15 of the Agreement
      is hereby amended by:

     

    (a)  adding
      the
      following proviso at the end of the first sentence of such section:

     

    “;
      provided, however, that each of Barclays Bank, PLC, Glenview Capital
      Management, LLC (and any funds for which it is an investment advisor) and Morgan
      Stanley & Co., Inc. may sell, assign, pledge, hypothecate or otherwise
      transfer Notes (or any rights in respect thereof, including the right to vote)
      held by such Noteholder as of the execution date of this Agreement, each in
      an
      amount of up to the amount of Notes disclosed in writing to the Advisors and
      the
      Company on February 14, 2008, without complying with the foregoing restrictions
      or the notice requirements set forth below.”; and

     

    (b)  adding
      the
      following sentence at the end of such section:

     

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    “Notwithstanding
      anything contained herein to the contrary, each of Barclays Bank PLC, Glenview
      Capital Management, LLC (and any funds for which it is an investment advisor)
      and Morgan Stanley & Co., Inc. may sell, assign, pledge, hypothecate or
      otherwise transfer any Notes (or any rights in respect thereof, including the
      right to vote) that such Noteholder acquired from and after February 14, 2008
      from any person who is not a Noteholder, without complying with any of the
      restrictions or notice requirements contained in this Section 15.”

     

    3.  Amendments.  Section
      6 of the Agreement is hereby amended by deleting the first sentence thereof
      and
      replacing it with the following sentence:

     

    “This
      Agreement constitutes the full agreement between the Parties with respect to
      the
      subject matter hereof, and it may not be modified or amended except by a written
      instrument, signed by each of the Parties, expressing such amendment or
      modification; provided, however, that any extension of this Agreement
      on or after March 17, 2008 shall be effective only as to those Noteholders
      that
      are signatory thereto.”

     

    4.  Effectiveness.  This
      Amendment shall become effective on the first date on which each of the
      following conditions is satisfied and evidence of its satisfaction has been
      delivered to counsel to the Noteholder Group:

     

    (a)  execution
      and delivery of counterparts of this Agreement by the Noteholders, the Company
      and the Subsidiaries;

     

    (b)  execution
      and delivery of an amendment and restatement of the Credit Agreement
      substantially in the form delivered to the Advisors on February 13,
      2008.

     

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

     

    (c)  execution
      and delivery of Houlihan Lokey’s engagement letter by the Company;
      and

     

    (d)  payment
      of
      the third monthly fee of $150,000 to Houlihan Lokey for the period through
      March
      14, 2008.

     

    This
      Amendment shall be effective as to the Noteholders, the Company and the
      Subsidiaries in accordance with Section 4 hereof regardless of whether the
      Indenture Trustee executes this Agreement.  This Amendment shall be
      effective as to the Indenture Trustee upon the Indenture Trustee becoming a
      signatory hereto.

     

    5.  Representations,
      Warranties and Covenants.

     

    (a)  The
      Company and the Subsidiaries represent, warrant and covenant as
      follows:

     

    (i)  Except
      for
      the Interest Default, no other Default or Event of Default has occurred and
      is
      continuing.

     

    (ii)  The
      execution, delivery and performance by the Company and the Subsidiaries of
      this
      Agreement:

     

    (1)  are
      within
      their corporate powers;

     

    (2)  have
      been
      duly authorized by all necessary corporate action;

     

    (3)  do
      not and
      will not (A) contravene their certificate of incorporation or by-laws or limited
      partnership or other constituent documents, (B) violate any (i) applicable
      material requirement of law or (ii) material order or decree of any governmental
      authority or arbitrator applicable to them, (C) materially conflict with or
      result in the breach of, or constitute a default under, or result in or permit
      the termination or acceleration of, any material contractual obligation of
      the
      Company or the Subsidiaries, or (D) result in the creation or imposition of
      any
      material lien or encumbrance upon any of the material property of the Company
      or
      the Subsidiaries; and

     

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    (4)  do
      not and
      will not require the consent of, authorization by, approval of any governmental
      authority.

     

    (b)  The
      Noteholders represent as follows:

     

    (i)  As
      of the
      date hereof, based on the representations of each of the individual Noteholders,
      the Noteholders, in the aggregate, hold, with all rights, including without
      limitation the right to vote, not less than $286,650,000 in principal amount
      of
      the Notes, representing not less than 91% of the aggregate principal amount
      of
      the Notes outstanding.

     

     

    (ii)  As
      of the
      date hereof, based on the representations of each of the individual Noteholders,
      the Noteholders, in the aggregate, hold, with all rights, including without
      limitation the right to vote, not less than $184,250,000 in principal amount
      of
      the Second Lien Notes, representing not less than 67% of the aggregate principal
      amount of the Second Lien Notes outstanding.

     

    6.  Ratification
      of Liability.  The Company and its Subsidiaries hereby ratify and
      reaffirm all of their payment and performance obligations and obligations to
      indemnify, contingent or otherwise, under the Indenture.

     

    7.  Complete
      Integration; Amendments.  This Amendment, together with the
      Agreement – which remains in full force and effect except as expressly modified
      by this Amendment – constitutes the full and final agreement between the Parties
      with respect to the subject matter hereof, and may not be modified or amended
      except by a written instrument, signed by each of the Parties, expressing such
      amendment or modification.  The Parties warrant, promise and represent
      that in executing this Amendment, each Party is not relying upon any oral
      representation, promise or statement made by any other Party hereto and that
      each Party is not relying upon any promise, statement or representation
      contained in any other written instrument.

     

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    8.  No
      Other Amendments; Reservation of Rights, No Waiver.  Other than as
      otherwise expressly provided herein, this Amendment shall not be deemed to
      operate as an amendment or waiver of, or to prejudice, any right, power,
      privilege or remedy of the Noteholders or the Indenture Trustee, as applicable,
      under the Indenture or applicable law, nor shall the entering into this
      Amendment preclude the Noteholders from refusing to enter into any further
      amendments or forbearances with respect to the Indenture.  Other than
      as expressly provided herein, this Amendment shall not constitute a forbearance
      with respect to (i) any failure by the Company to comply with any covenant
      or
      other provision in the Indenture or (ii) the occurrence or continuance of any
      present or future Event of Default.

     

    9.  Counterparts/Facsimile
      Transmission.  This Amendment may be signed in counterparts, each
      of which, when taken together, shall be deemed an original.  Execution
      of this Amendment is effective if a signature is delivered by facsimile
      transmission or electronic (e.g., “pdf”) transmission.

     

    10.  Successors
      and Assigns.  This Amendment shall be binding upon and inure to
      the benefit of the Parties hereto and each of their respective successors,
      assigns, heirs and personal representatives.

     

    11.  Authority.  Any
      person signing this Amendment in a representative capacity (i) represents and
      warrants that he/she is authorized to sign this Amendment on behalf of the
      Party
      he/she represents and that his/her signature upon this Amendment will bind
      the
      represented Party to the terms of this Amendment, and (ii) acknowledges that
      the
      other Party to this Amendment has relied upon such representation and
      warranty.

     

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    12.  Governing
      Law.  This Amendment shall be governed by and construed in
      accordance with the laws of the State of New York, without regard to its choice
      of law provisions.

     

    13.  Direction
      to Indenture Trustee.  The Noteholders’ agreement to forbear as
      provided in the Agreement as amended by this Amendment shall constitute a
      direction from such Noteholders to the Indenture Trustee to similarly forbear
      during the Forbearance Period as extended hereby.

    
 

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

      
       

    

    IN
      WITNESS
      WHEREOF, each of the Parties hereto has caused this Amendment to be duly
      executed and delivered as of the date first above written.

    
      

       

      
        	
                Tekni-Plex,
                  Inc.,

              	 
	 	 
	
                By:

              	
                /s/
                  James E. Condon

              	 
	 	
                Name:

              	
                James
                  E. Condon

              	 
	 	
                Title:

              	
                Chief
                  Financial Officer

              	 

      

      

       

      
        	
                SUBSIDIARIES

                 

                PURETEC
                  CORPORATION

                NATVAR
                  HOLDINGS, INC.

                TRI-SEAL
                  HOLDINGS, INC.

                PLASTIC
                  SPECIALTIES AND TECHNOLOGIES, INC.

                BURLINGTON
                  RESINS, INC.

                PLASTIC
                  SPECIALTIES AND TECHNOLOGIES

                INVESTMENTS,
                  INC.

                DISTRIBUTORS
                  RECYCLING, INC.

                TPI
                  ACQUISITION SUBSIDIARY, INC.

                TP/ELM
                  ACQUISITION SUBSIDIARY, INC.,

                collectively,
                  as Guarantors 

              
	 	 
	
                By:

              	
                /s/
                  James E. Condon

              	 
	 	
                Name:

              	
                James
                  E. Condon

              	 
	 	
                Title:

              	
                Chief
                  Financial Officer

              	 

      

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
 

      
        	
                THE
                  NOTEHOLDERS

                 

                AVENUE
                  INVESTMENTS, L.P.

              	 
	 	 
	
                By:

              	
                Avenue
                  Partners,
                  LLC,

                its
                  General
                  Partner

              	 
	 	 	 
	
                By:

              	
                /s/
                  Sonia Gardner

              	 
	 	
                Name:

              	
                Sonia
                  Gardner

              	 
	 	
                Title:

              	
                Member

              	 

      

      

      
        	
                AVENUE-CDP
                  GLOBAL OPPORTUNITIES
                  FUND, L.P. 

              
	 	 
	
                By:

              	
                Avenue
                  Global Opportunities Fund
                  GenPar, LLC,

                its
                  General
                  Partner

              	 
	 	 	 
	
                By:

              	
                /s/
                  Sonia Gardner

              	 
	 	
                Name:

              	
                Sonia
                  Gardner

              	 
	 	
                Title:

              	
                Member

              	 

      

      

      
        	
                AVENUE
                  INTERNATIONAL MASTER,
                  L.P. 

              
	 	 
	
                By:

              	
                Avenue
                  International Master
                  GenPar, Ltd.,

                its
                  General
                  Partner

              	 
	 	 	 
	
                By:

              	
                /s/
                  Sonia Gardner

              	 
	 	
                Name:

              	
                Sonia
                  Gardner

              	 
	 	
                Title:

              	
                Member

              	 

      

      

      
        	
                AVENUE
                  SPECIAL SITUATIONS FUND IV,
                  L.P.

              	 
	 	 
	
                By:

              	
                Avenue
                  Capital Partners IV, LLC,
                  its General Partner

              	 
	
                By:

              	
                GL
                  Partners IV,
                  LLC,

                its
                  General
                  Partner

              	 
	 	 	 
	
                By:

              	
                /s/
                  Sonia Gardner

              	 
	 	
                Name:

              	
                Sonia
                  Gardner

              	 
	 	
                Title:

              	
                Member

              	 

      

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
 

      
        	
                AVENUE
                  SPECIAL SITUATIONS FUND V,
                  L.P.

              	 
	 	 
	
                By:

              	
                Avenue
                  Capital Partners V,
                  LLC,

                its
                  General
                  Partner

              	 
	
                By:

              	
                GL
                  Partners V,
                  LLC,

                its
                  General
                  Partner

              	 
	 	 	 
	
                By:

              	
                /s/
                  Sonia Gardner

              	 
	 	
                Name:

              	
                Sonia
                  Gardner

              	 
	 	
                Title:

              	
                Member

              	 

      

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        	
                BARCLAYS
                  BANK, PLC

              	 
	 	 
	
                By:

              	
                /s/
                  Brian Berman

              	 
	 	
                Name:

              	
                Brian
                  Berman

              	 
	 	
                Title:

              	
                Managing
                  Director

              	 

      

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
 

      
        	
                GLENVIEW
                  CAPITAL MANAGEMENT, LLC,

                as
                  investment adviser for GCM Little Arbor Partners, L.P.,

                GCM
                  Little Arbor Institutional Partners, L.P., and

                GCM
                  Little Arbor Master Fund, Ltd.

              	 
	 	 
	
                By:

              	
                /s/
                  Mark Horowitz

              	 
	 	
                Name:

              	
                Mark
                  Horowitz

              	 
	 	
                Title:

              	
                Chief
                  Operating Officer and General Counsel

              	 

      

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        	
                MORGAN
                  STANLEY & CO.,
                  INC

              	 
	 	 
	
                By:

              	
                /s/
                  Andrew Brenner

              	 
	 	
                Name:

              	
                Andrew
                  Brenner

              	 
	 	
                Title:

              	
                Managing
                  Director

              	 

      

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
 

      
        	
                OAKTREE
                  CAPITAL MANAGEMENT, L.P.,

                on
                  behalf of itself and certain funds and accounts managed

                by
                  it or its affiliates

              	 
	 	 
	
                By:

              	
                /s/
                  Ken Liang

              	 
	 	
                Name:

              	
                Ken
                  Liang

              	 
	 	
                Title:

              	
                Managing
                  Director

              	 
	 	 	 	 
	
                By:

              	
                /s/
                  Aaron Bendikson

              	 
	 	
                Name:

              	
                Aaron
                  Bendikson

              	 
	 	
                Title:

              	
                Senior
                  Vice PresidentEX-10.1

 

Exhibit 10.1

EXECUTION COPY

SECOND AMENDED AND RESTATED

LIMITED PARTNERSHIP AGREEMENT

OF

NET LEASE STRATEGIC ASSETS FUND L.P.

Dated as of February 20, 2008

 

 

TABLE
OF CONTENTS

	 	 	 	 	 
	 	 	Page	 
	ARTICLE I DEFINITIONS
	 	 	1	 
	Section 1.1 Definitions
	 	 	1	 
	ARTICLE II FORMATION, DURATION AND PURPOSES; PURCHASE OF INITIAL PROPERTIES
	 	 	18	 
	Section 2.1 Formation
	 	 	18	 
	Section 2.2 Name; Registered Agent and Registered Office
	 	 	18	 
	Section 2.3 Principal Office
	 	 	18	 
	Section 2.4 Purposes and Business
	 	 	18	 
	Section 2.5 Term
	 	 	18	 
	Section 2.6 Other Qualifications
	 	 	19	 
	Section 2.7 Limitation on the Rights of Partners
	 	 	19	 
	Section 2.8 Purchase of Qualified Sale Assets
	 	 	19	 
	Section 2.9 Remuneration To Partners
	 	 	19	 
	ARTICLE III MANAGEMENT RIGHTS, DUTIES, AND POWERS OF THE GENERAL PARTNER; TRANSACTIONS INVOLVING
PARTNERS
	 	 	19	 
	Section 3.1 Management
	 	 	19	 
	Section 3.2 Actions of the General Partner
	 	 	21	 
	Section 3.3 Authority of the General Partner
	 	 	21	 
	Section 3.4 Major Decisions
	 	 	23	 
	Section 3.5 Preliminary and Annual Plans
	 	 	26	 
	Section 3.6 Qualified Asset Acquisitions
	 	 	27	 
	Section 3.7 Sale of Qualified Assets
	 	 	30	 
	Section 3.8 Partnership Indebtedness
	 	 	31	 
	Section 3.9 Business Opportunity
	 	 	32	 
	Section 3.10 Payments to the Asset Manager of the General Partner
	 	 	34	 
	Section 3.11 Exculpation
	 	 	35	 
	Section 3.12 Indemnification
	 	 	36	 
	ARTICLE IV BOOKS AND RECORDS; REPORTS TO PARTNERS
	 	 	37	 
	Section 4.1 Books
	 	 	37	 
	Section 4.2 Monthly and Quarterly Reports
	 	 	37	 

-i-

 

TABLE OF CONTENTS

(continued)

	 	 	 	 	 
	 	 	Page	 
	Section 4.3 Annual Reports
	 	 	38	 
	Section 4.4 Accountants; Tax Returns
	 	 	38	 
	Section 4.5 Accounting and Fiscal Year
	 	 	38	 
	Section 4.6 Partnership Funds
	 	 	38	 
	Section 4.7 Insurance
	 	 	39	 
	ARTICLE V CONTRIBUTIONS
	 	 	39	 
	Section 5.1 Capital Contributions
	 	 	39	 
	Section 5.2 Preferred Equity Capital Contribution
	 	 	42	 
	Section 5.3 Return of Capital Contribution
	 	 	42	 
	Section 5.4 Liability of the Limited Partners
	 	 	42	 
	Section 5.5 No Third Party Beneficiaries
	 	 	42	 
	ARTICLE VI MAINTENANCE OF CAPITAL ACCOUNTS; ALLOCATION OF PROFITS AND LOSSES FOR BOOK AND TAX
PURPOSES
	 	 	42	 
	Section 6.1 Capital Accounts
	 	 	42	 
	Section 6.2 Profits and Losses
	 	 	43	 
	Section 6.3 Regulatory Allocations
	 	 	44	 
	Section 6.4 Allocation of Tax Items for Tax Purposes
	 	 	46	 
	Section 6.5 Tax Matters Partner
	 	 	47	 
	Section 6.6 Adjustments
	 	 	47	 
	ARTICLE VII DISTRIBUTIONS
	 	 	47	 
	Section 7.1 Cash Available for Distributions
	 	 	47	 
	ARTICLE VIII TRANSFER; REMOVAL OF GENERAL PARTNER
	 	 	51	 
	Section 8.1 Prohibition on Transfers and Withdrawals by Partners
	 	 	51	 
	Section 8.2 Removal of LMLP GP as General Partner
	 	 	52	 
	ARTICLE IX TERMINATION
	 	 	52	 
	Section 9.1 Dissolution
	 	 	52	 
	Section 9.2 Termination
	 	 	53	 
	Section 9.3 Certificate of Cancellation
	 	 	54	 
	Section 9.4 Acts in Furtherance of Liquidation
	 	 	54	 
	ARTICLE X REPRESENTATIONS OF THE PARTNERS
	 	 	54	 

-ii-

 

TABLE OF CONTENTS

(continued)

	 	 	 	 	 
	 	 	Page	 
	Section 10.1 Representations of Inland
	 	 	54	 
	Section 10.2 Representations of the LMLP Partners
	 	 	56	 
	ARTICLE XI SPECIAL PARTNER RIGHTS AND OBLIGATIONS
	 	 	57	 
	Section 11.1 Right of First Offer
	 	 	57	 
	Section 11.2 Buy/Sell
	 	 	58	 
	Section 11.3 Provisions Applicable to Right of First Offer and Buy/Sell
	 	 	60	 
	ARTICLE XII GENERAL PROVISIONS
	 	 	61	 
	Section 12.1 Notices
	 	 	61	 
	Section 12.2 Governing Laws
	 	 	62	 
	Section 12.3 Entire Agreement
	 	 	63	 
	Section 12.4 Waiver
	 	 	63	 
	Section 12.5 Validity
	 	 	63	 
	Section 12.6 Terminology; Captions
	 	 	63	 
	Section 12.7 Remedies Not Exclusive
	 	 	63	 
	Section 12.8 Action by the Partners
	 	 	64	 
	Section 12.9 Further Assurances
	 	 	64	 
	Section 12.10 Liability of the Limited Partners
	 	 	64	 
	Section 12.11 Binding Effect
	 	 	64	 
	Section 12.12 Amendments
	 	 	64	 
	Section 12.13 Counterparts
	 	 	64	 
	Section 12.14 Waiver of Partition
	 	 	64	 
	Section 12.15 No Third Party Beneficiaries
	 	 	64	 
	Section 12.16 Expenses
	 	 	64	 
	Section 12.17 Jurisdiction; Venue
	 	 	65	 
	Section 12.18 Jury Waiver
	 	 	65	 
	Section 12.19 REIT Provisions.
	 	 	65	 

-iii-

 

TABLE OF CONTENTS

(continued)

	 	 	 	 	 
	 	 	 	 	Page
	SCHEDULE 1

	 	CAPITAL COMMITMENT OF PARTNERS/INITIAL CAPITAL CONTRIBUTIONS/PERCENTAGE

INTERESTS/PREFERRED EQUITY CAPITAL CONTRIBUTION/QUALIFIED CONTRIBUTED ASSETS	 	 
	SCHEDULE 2

	 	ACQUISITION PARAMETERS	 	 
	SCHEDULE 2.8

	 	QUALIFIED SALE ASSETS	 	 
	SCHEDULE 3.5

	 	FORM OF ANNUAL PLAN	 	 
	SCHEDULE 3.9

	 	LMLP EXISTING JOINT VENTURE EXCLUSIVITY TERMS	 	 
	SCHEDULE 4.7

	 	INSURANCE REQUIREMENTS	 	 
	 
	 	 	 	 
	EXHIBIT A 

EXHIBIT B 

EXHIBIT C 

EXHIBIT D 

EXHIBIT E

	 	FORM OF ANNUAL BUDGET

FORM OF CONTRIBUTION AGREEMENT

FORM OF MANAGEMENT AGREEMENT

FORM OF PURCHASE AGREEMENT

FORM OF SP SUBSIDIARY PARTNERSHIP AGREEMENT	 	 
	EXHIBIT F

	 	FORM OF SP SUBSIDIARY LIMITED LIABILITY COMPANY AGREEMENT	 	 

-iv-

 

SECOND AMENDED AND RESTATED

LIMITED PARTNERSHIP AGREEMENT

OF

NET LEASE STRATEGIC ASSETS FUND L.P.

     THIS SECOND AMENDED AND RESTATED LIMITED PARTNERSHIP AGREEMENT (as it may be amended,
modified, supplemented or restated from time to time, this “Agreement”) of NET LEASE STRATEGIC
ASSETS FUND L.P. (the “Partnership”), made and entered into as of February 20, 2008 by and among
The Lexington Master Limited Partnership, a Delaware limited partnership (“LMLP”), as a
limited partner of the Partnership, LMLP GP LLC, a Delaware limited liability company
(“LMLP GP”), as a general partner of the Partnership, and Inland American (Net Lease) Sub,
LLC, a Delaware limited liability company (“Inland”), as a limited partner of the Partnership,
amends and restates in its entirety the Amended and Restated Limited Partnership Agreement, made
and entered into as of November 5, 2007 (the “Prior Agreement”), by and among LMLP, LMLP GP and
Inland, as amended by that certain First Amendment to the Limited Partnership Agreement of the
Partnership, dated December 20, 2007.

     LMLP and Inland are sometimes individually referred to herein as a “Limited Partner” and
collectively referred to herein as the “Limited Partners”. The Limited Partners and the General
Partner are sometimes individually referred to herein as a “Partner” and collectively referred to
herein as the “Partners”. LMLP and LMLP GP are sometimes individually referred to herein as a
“LMLP Partner” and collectively referred to herein as the “LMLP Partners”.

     In consideration of the covenants and agreements set forth herein, the Partners hereby amend
and restate the Prior Agreement in its entirety and agree as follows:

ARTICLE I

DEFINITIONS

          Section 1.1 Definitions. For the purposes of this Agreement, initially
capitalized terms used herein shall have the following meanings:

     “Acquisition Activities” is defined in Section 3.6(f) hereof.

     “Acquisition Costs” is defined in Section 3.6(f) hereof.

     “Acquisition Fee” is defined in Section 3.6(g) hereof.

     “Acquisition Memorandum” shall mean a memorandum with respect to any Proposed
Qualified Asset as provided in Section 3.6(b) hereof.

     “Acquisition Parameters” shall mean the guidelines and requirements for any Proposed
Qualified Asset that are set forth on Schedule 2 hereto.

 

 

     “Acquisition Period” shall mean the period commencing on August 10, 2007 and ending
the earliest of (a) the second anniversary of August 10, 2007 and (b) a Removal Event; provided
that, if the Acquisition Period has not ended because of a Removal Event, the Acquisition Period
may, pursuant to Section 3.4 hereof, be extended for a period of six months.

     “Act” is defined in Section 2.1 hereof.

     “Additional Capital Contribution” is defined in Section 5.1(b) hereof.

     “Adjusted Capital Account Deficit” shall mean the deficit balance, if any, in a
Partner’s Capital Account at the end of any fiscal year, with the following adjustments:
(a) credit to such Capital Account any amount that such Partner is obligated or deemed obligated to
restore under Regulations Section 1.704-1(b)(2)(ii)(c), as well as any additions thereto pursuant
to the next to last sentences of Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5), after taking
into account thereunder any changes during such year in Partnership Minimum Gain and in the minimum
gain attributable to any Partner Nonrecourse Debt; and (b) debit to such Capital Account the items
described in Regulations Section 1.704-1(b)(2)(ii)(d)(4), (5) and (6). The foregoing definition of
Adjusted Capital Account Deficit is intended to comply with the provisions of Regulations
Section 1.704-1(b)(2)(ii)(d) and shall be interpreted in a manner consistent with such intent.

     “Affiliate” when used with respect to any particular Person, shall mean (a) any Person
or group of Persons acting in concert that directly or indirectly through one or more
intermediaries controls or is controlled by or is under common control with such particular Person,
(b) any Person that is an officer, partner, manager, member or trustee of, or serves in a similar
capacity with respect to, such particular Person or of which such particular Person is an officer,
partner, manager, member or trustee or with respect to which such particular Person serves in a
similar capacity, (c) any Person that, directly or indirectly, is the beneficial owner of 10% or
more of any class of voting securities of, or otherwise has an equivalent beneficial interest in,
such particular Person or of which such particular Person is directly or indirectly the owner of
10% or more of any class of voting securities or in which such particular Person has an equivalent
beneficial interest or (d) any relative or spouse of such particular Person. Notwithstanding the
foregoing, (a) neither LMLP nor LMLP GP shall be deemed to be an Affiliate of Inland and (b) Inland
shall not be deemed to be an Affiliate of the LMLP Partners. The definition of “Affiliate” as used
in this Agreement shall not be affected by the Regulations under Code Section 752 describing
certain “related” parties.

     “Agreement” is defined in the Preamble hereto. This Agreement shall be the
“partnership agreement” for the Partnership within the meaning of Section 17-101(12) of the Act.

     “Annual Budget” shall mean the annual budget for the Partnership and each Qualified
Asset for any fiscal year, including without limitation a reasonable description of the amount,
source and character of each item of gross income, expense and services to be rendered in the form
attached hereto as Exhibit A, approved by the Executive Committee as provided in
Section 3.5 hereof.

2

 

     “Annual Plan” is defined in Section 3.5(a) hereof.

     “Approved Qualified Asset” is defined in Section 3.6(d) hereof.

     “Asset Manager” shall mean (i) so long as LMLP GP is the General Partner, Lexington
Realty Advisors, Inc. or another Affiliate of LMLP, or (ii) so long as LMLP GP is no longer the
General Partner, such other entity, including an Affiliate of Inland, that may be appointed by the
Executive Committee, in each case to provide asset management services to the Partnership on market
terms if a third party manager is hired or pursuant to the terms of the Management Agreement if an
Inland Affiliate.

     “Bankruptcy” of the Partnership or a Partner shall be deemed to have occurred upon the
happening of any of the following: (a) the filing of an application by the Partnership or such
Partner for, or a consent to, the appointment of a trustee, receiver or liquidator of its assets;
(b) the filing by the Partnership or such Partner of a voluntary petition or answer in bankruptcy
or the filing of a pleading in any court of record admitting in writing its inability to pay its
debts as such debts come due or seeking reorganization, arrangement, composition, readjustment,
liquidation, dissolution or similar relief under any statute, law or regulation; (c) the making by
the Partnership or such Partner of a general assignment for the benefit of creditors; (d) the
filing by the Partnership or such Partner of an answer admitting the material allegations of, or
its consenting to or defaulting in answering, a bankruptcy or insolvency petition filed against it
in any bankruptcy or similar proceeding; (e) the entry by any court of competent jurisdiction of an
order for relief in any bankruptcy or insolvency proceeding involving the Partnership or such
Partner or of an order, judgment or decree adjudicating the Partnership or such Partner a bankrupt
or insolvent or appointing a trustee, receiver or liquidator of its assets; or (f) the filing by a
third party against the Partnership of such Partner of an involuntary petition under any bankruptcy
or insolvency law, which petition is not dismissed within sixty (60) days from the date of such
filing.

     “Book Basis” shall mean, with respect to any asset of the Partnership, the adjusted
basis of such asset for federal income tax purposes; provided, however, that (a) if any asset is
contributed to the Partnership, the initial Book Basis of such asset shall equal its fair market
value on the date of contribution (as agreed to by the Partners), and (b) if the Capital Accounts
of the Partners are adjusted pursuant to Treasury Regulations Section 1.704-1(b) to reflect the
fair market value of any asset of the Partnership, the Book Basis of such asset shall be adjusted
to equal its respective fair market value as of the time of such adjustment (as agreed to by the
Partners), in accordance with such Treasury Regulations. The Book Basis of all assets of the
Partnership shall be adjusted thereafter by depreciation or amortization as provided in Treasury
Regulations Section 1.704-1(b)(2)(iv)(g) and any other adjustment to the basis of such assets other
than depreciation or amortization.

     “Book Depreciation” shall mean all deductions attributable to the depreciation,
amortization or other cost recovery, including additions, of any Qualified Asset or other asset
(whether tangible or intangible) acquired by the Partnership that has a useful life in excess of
one year, as such deductions are computed for federal income tax purposes; provided, that
with respect to any Partnership asset the tax basis of which differs from the Book Value of such
asset, Book Depreciation for any period shall equal (a) the sum total of all deductions taken
during

3

 

such period attributable to depreciation, amortization or other cost recovery deduction for
federal income tax purposes with respect to such asset, multiplied by (b) the Book Value of such
asset divided by the tax basis thereof; provided further, that if the depreciation,
amortization or other cost recovery deduction for federal income tax purposes with respect to any
Partnership asset for any period is zero ($0.00), Book Depreciation shall be determined by the Tax
Matters Partner using any reasonable method selected by the Tax Matters Partner that is based on
the Book Value of such asset.

     “Book Value” shall mean, with respect to any Partnership asset at any time, the
adjusted basis of such asset for federal income tax purposes, except that (a) the initial Book
Value of any asset contributed by a Partner to the Partnership shall be the Fair Market Value of
such asset, and (b) the Book Value of all Partnership assets shall be adjusted to equal their Fair
Market Values, as determined in good faith by the General Partner, upon the occurrence of certain
events as described below. In either case, the Book Value of Partnership assets shall thereafter
be adjusted for Book Depreciation taken into account with respect to such asset. Provided the Tax
Matters Partner makes an election to do so as provided under Section 1.704-1(b)(2)(iv)(f) of the
Regulations, the Book Value of Partnership assets shall be adjusted to equal their Fair Market
Value, as determined in good faith by the General Partner, as of the following times to which the
election relates: (a) the admission of a new Partner to the Partnership or acquisition by an
existing Partner of an additional interest in the Partnership, provided that the consideration
contributed to the Partnership upon such admission or acquisition is more than a de minimis amount
of money or assets; (b) the distribution by the Partnership to a Partner of more than a de minimis
amount of money or other assets; and (c) the termination of the Partnership for federal income tax
purposes pursuant to Code Section 708(b)(1)(B).

     The Book Value of all Partnership assets shall also be increased (or decreased) to the extent
that adjustments to the adjusted basis of such assets pursuant to Code Section 734(b) or Code
Section 743(b) have been taken into account for purposes of determining Capital Accounts in
accordance with Regulation Section 1.704-1(b)(2)(iv)(m), unless such adjustments have already been
accounted for pursuant to the preceding paragraph. If the Book Value of an asset has been
determined or adjusted pursuant hereto, such value shall thereafter be the basis for, and be
adjusted by, the depreciation taken into account with respect to, such asset for purposes of
computing Profits and Losses. Moreover, notwithstanding the foregoing, the Book Value of any
Partnership asset distributed to any Partner shall be the gross Fair Market Value of such asset on
the date of distribution.

     “Business Day” shall mean any day other than a Saturday, Sunday or any day on which
national banks in New York, New York are not open for business.

     “Buy/Sell Asset” is defined in Section 11.2(a) hereof.

     “Buy/Sell Notice” is defined in Section 11.2(a) hereof.

     “Buy/Sell Offer Price” is defined in Section 11.2(a) hereof.

     “Buy/Sell Offering Partner” is defined in Section 11.2(a) hereof.

4

 

     “Buy/Sell Responding Interest Price” is defined in Section 11.2(c) hereof.

     “Buy/Sell Responding Partner” is defined in Section 11.2(a) hereof.

     “Buy/Sell Response Notice” is defined in Section 11.2(a) hereof.

     “Cap Ex/Lease Assumed Asset” shall mean the following Qualified Assumed Assets: (i)
the property located at 940 Industrial Road, Marshall, Michigan; (ii) the property located at 10419
North 30th Street, Tampa, Florida; and (iii) the property located at 601 & 701 Experian
Parkway, Allen, Texas.

     “Cap Ex/Lease Assumed Asset Amount” is defined in Section 5.1(a) hereof.

     “Capital Account” shall mean, with respect to any Partner, the separate “book” account
which the Partnership shall establish and maintain for such Partner as provided in
Section 6.1 hereof and in accordance with Section 704(b) of the Code and Regulations
Section 1.704-1(b)(2)(iv) and such other provisions of Section 1.704-1(b) of the Regulations as
must be complied with in order for the Capital Accounts to be determined in accordance with the
provisions of said Regulations. In furtherance of the foregoing, the Capital Accounts shall be
maintained in compliance with Section 1.704-1(b)(2)(iv) of the Regulations, and the provisions
hereof shall be interpreted and applied in a manner consistent therewith.

     “Capital Call” is defined in Section 5.1(b) hereof.

     “Capital Commitment” shall mean, with respect to each Partner, the amount set forth
opposite its name on Schedule 1 hereto, as such Schedule may be amended or modified from
time to time upon the Partners’ unanimous consent.  Any payment of the Acquisition Fees by Inland
shall decrease Inland’s Capital Commitment, and, in such event, LMLP’s Capital Commitment shall be
decreased by 17.65% of the amount Inland’s Capital Commitment is decreased. 

     “Capital Contribution” shall mean, (a) the Initial Capital Contributions set forth on
Schedule 1 hereto, (b) the Remaining Qualified Assumed Assets Capital Contribution, which
when made shall be added to Schedule 1 hereto, and (c) at any particular time thereafter
and with respect to any Partner, an amount equal to the sum of (a) the total amount of cash and
(b) the Fair Market Value of any asset (determined as of the date such asset is contributed by such
Partner and net of any liabilities secured by such asset that the Partnership is considered to
assume or take subject to under Section 752 of the Code) that has in each case been contributed to
the Partnership by such Partner pursuant to Section 5.1 hereof.

     “Change of Control” shall be deemed to occur upon (a) any Person (and its Affiliates)
becoming the beneficial owner, directly or indirectly, of more than fifty percent (50%) of the
outstanding partnership interests in LMLP (other than an LMLP Affiliated Party) and (b) the
resignation or removal (including death or permanent disability) of at least two of the following
individuals from the management of LMLP: Michael L. Ashner, E. Robert Roskind and T. Wilson Eglin.

     “Closing” is defined in Section 11.3(c) hereof.

     “Closing Date” is defined in Section 11.3(c) hereof.

5

 

     “Code” shall mean the Internal Revenue Code of 1986, as amended, or corresponding
provisions of future laws.

     “Contributed Asset” is defined in the Contribution Agreement.

     “Contribution Agreement” shall mean the Contribution Agreement, dated as of August 10,
2007, pursuant to which LMLP contributes the Qualified Contribution Assets to the Partnership
pursuant to Section 5.1 hereof and a copy of which is attached as Exhibit B to this
Agreement.

     “CPI” shall mean the Revised Consumer Price Index for All Urban Consumers published by
the Bureau of Labor Statistics of the United States Department of Labor, U.S. City Average, All
Items, based on 2002 as 100. If the CPI hereafter ceases to use the 2002 Base as 100, then the CPI
with the new base shall be used. If the Bureau of Labor Statistics ceases to publish the CPI, then
the successor or most nearly comparable index shall be used. In the event that the U.S.
Department of Labor, Bureau of Labor Statistics, changes the publication frequency of the CPI so
that it is not available when required under the Agreement, then the CPI for the closest preceding
month for which a CPI is available shall be used in place of the CPI no longer available.

     “Default Sale Period” is defined in Section 11.3(d) hereof.

     “Defaulting Partner” is defined in Section 11.3(b) hereof.

     “Delayed Qualified Assumed Assets” shall mean the following Qualified Assumed Assets:
(i) the property located at 9110 Grogans Mill Road, Houston, Texas; and (ii) the property located
at 1200 Jupiter Road, Garland, Texas.

     “Deposit” is defined in Section 5.1(d) hereof.

     “Distributable Cash” shall mean the amounts distributed pursuant to Sections
7.1(b) and (c) hereof.

     “Distribution Date” is defined in Section 7.1(b)(i) hereof.

     “Economic Interest” shall mean, with respect to any Percentage Interest, (a) all
income, profits, cash flow, proceeds of sales and/or refinancing of the Qualified Assets, fees or
payments of whatever nature and all distributions to which any Partner would be entitled, now or at
any time hereafter, of whatsoever description or character; (b) all of any Partner’s present and
future rights to and in its Capital Account, whether by way of liquidating distributions or
otherwise, and all of such Partner’s right to receive or share in any surplus of the Partnership in
the event of the dissolution of the Partnership; and (c) all damages, awards, money and
considerations of any kind or character to which any Partner would be entitled, now or at any time
hereafter, arising out of or derived from any proceeding by or against such Partner in any federal
or state court, under any bankruptcy or insolvency law or under any law relating to assignments for
the benefit of creditors, compositions, extensions or adjustments of
indebtedness, or to any other relief of debtors, or otherwise in connection with its interest
in the Partnership.

6

 

     “Economic Risk of Loss” shall have the meaning specified in Regulations
Section 1.752-2.

     “Environmental Assessment” shall mean with respect to any Proposed Qualified Asset, a
phase one environmental site assessment performed by a qualified environmental consultant selected
by the General Partner in accordance with the then current ASTM Standard Practice for Environmental
Site Assessments, E1527 and, if required by the General Partner, any additional Phase II sampling,
investigation, monitoring or other activities performed by a qualified environmental consultant.

     “Environmental Law” shall mean every federal, state, county or other governmental law,
statute, ordinance, rule, regulation, requirement, order (including any consent order), or other
binding obligation, injunction, writ or decision relating to or addressing the environment or
hazardous materials, including, but not limited to, those federal statutes commonly referred to as
the Clean Air Act, Clean Water Act, Resource Conservation Recovery Act, Toxic Substances Control
Act, Comprehensive Environmental Response, Compensation and Liability Act and the Endangered
Species Act as well as all regulations promulgated thereunder and all state laws and regulations
equivalent thereto, as each such statute, regulation or state law or regulation equivalent may be
amended from time to time.

     “Equity Capital” shall mean the book equity of the Partnership, computed in accordance
with GAAP and based on the monthly average over the fiscal year, adjusted to exclude the effect of
any depreciation, unrealized gains, unrealized losses and other non-cash items. For realized gains
or losses, the amount of gain or loss shall be based on unadjusted book value.

     “Event of Default” shall mean with respect to or by any Partner (a) the declaration of
Bankruptcy, (b) a failure to timely perform its obligations under this Agreement (or with respect
to the LMLP Partners, the failure by an LMLP Affiliated Party to timely perform its obligations
under the Contribution Agreement, the Purchase Agreement or the Management Agreement), including
the failure of the General Partner to timely enforce any material term of the Management Agreement,
or other material breach of this Agreement (or with respect to the LMLP Partners, any other
material breach by an LMLP Affiliated Party of a material provision of the Contribution Agreement,
the Purchase Agreement or the Management Agreement) and the continuation of such failure or other
material breach beyond the applicable grace, notice or cure periods, if any, including, without
limitation, the obligation to make any Additional Capital Contributions, (c) any attempted
assignment, mortgage, pledge, transfer or other disposition, whether voluntary or involuntary, of
its Percentage Interests (in whole or in part) not expressly permitted in this Agreement, (d) the
dissolution, withdrawal or incapacity of such Partner, which prohibits such Partner’s ability to
continue as a Partner of the Partnership, (e) the intentional misrepresentation by such Partner or
any of its Affiliates of a material fact involving the Partnership to another Partner or an
Affiliate thereof or to the Partnership, (f) the entry of a final judgment or decree of a court or
governmental agency having proper jurisdiction, declaring such Partner guilty of a felony involving
moral turpitude, fraud or wrongdoing in connection with any
business activity, (g) the misapplication by such Partner or any of its Affiliates of any
assets of the Partnership, or (h) fraud or material and willful misconduct by such Partner or any
of its Affiliates involving the Partnership or in the performance of its obligations under this
Agreement

7

 

or the Management Agreement, Contribution Agreement or Purchase Agreement. The matters
set forth in clauses (b), (c), (e), (f), (g) and (h) above shall not constitute an Event of Default
if such matter does not pertain to wrongdoing involving a criminal conviction and such matter is
cured (including the payment of any damages) within thirty (30) days following receipt of notice of
such failure from any other Partner, unless such matter by its very nature is incapable of being
cured within such thirty (30) day period and the defaulting Partner has commenced and is diligently
pursuing a cure, in which event such defaulting Partner shall have a commercially reasonable period
not to exceed ninety (90) days to effect such cure; provided that in the case of matters set forth
in (f), (g) and (h), the cure shall include the removal of the employees or agents involved in such
event from the active management of the Partnership. So long as LMLP GP is the General Partner, a
breach of Section 3.8(a) or Section 12.19 shall be considered an Event of Default
by LMLP, unless such breach (i) has been cured within ninety (90) days of such breach and a similar
breach of Section 3.8(a) has not occurred in the previous twelve (12) months in the case of
Section 3.8(a), (ii) was directly and proximately caused by an action approved by a
Supermajority Vote of the Executive Committee or consented to by Inland and Inland had knowledge of
the possibility of such breach.

     “Executive Committee” shall mean a committee of five (5) members, consisting of three
(3) members appointed by LMLP and two (2) members appointed by Inland. The initial members of the
Executive Committee appointed by the LMLP Partners shall be Michael L. Ashner, T. Wilson Eglin and
Brendan P. Mullinix. The initial members of the Executive Committee appointed by Inland shall be
Lori Foust and Thomas McGuinness.

     “Exclusivity Right” is defined in Section 3.9(a)(ii) hereof.

     “Existing Indebtedness” shall mean the existing indebtedness encumbering the Qualified
Contribution Assets and the Qualified Sale Assets, the principal balances as of August 1, 2007 are
respectively set forth on Schedules 1 and 2.8 hereto.

     “Extraordinary Call” is defined in Section 5.1(c) hereof.

     “Extraordinary Call Cap” is defined in Section 5.1(c) hereof.

     “Extraordinary Capital Contribution” is defined in Section 5.1(c) hereof.

     “Extraordinary Funding” is defined in Section 5.1(c) hereof.

     “Fair Market Value” shall mean an amount (in cash) that a bona fide, willing buyer
under no compulsion to buy and a bona fide, willing and unrelated seller under no compulsion to
sell would pay and accept, respectively, for the purchase and sale of a Qualified Asset, taking
into account any liens, restrictions and agreements then in effect and binding upon the Qualified
Asset or any successor owner thereof and any options, rights of first refusal or offer or other
rights or options that either burden the Qualified Asset or run to the benefit of the owner of the
Qualified Asset; provided, however, that in determining the Fair Market Value of any
Qualified Asset, none of the options, rights of first refusal or offer or other rights of the
Partners hereunder shall be taken into consideration.

8

 

     “General Partner” shall mean the Person appointed general partner of the Partnership
pursuant to the terms of this Agreement. The initial General Partner shall be LMLP GP.

     “Gross Revenues” is defined in Section 3.10(a) hereof.

     “Indemnified Party” is defined in Section 3.12(a) hereof.

     “Initial Capital Contribution” shall mean, (a) with respect to Inland, the amount of
cash and (b) with respect to each LMLP Partner, the amount of cash and the amount of the
Contribution Value (as defined in the Contribution Agreement), in each case as pursuant to
Section 5.1 hereof, as set forth on Schedule 1 hereto.

     “Initiating Partner” is defined in Section 11.3(f) hereof.

     “Inland” is defined in the Preamble hereto.

     “Inland Priority Return” is defined in Section 7.1(b)(i)(A) hereof.

     “Letter Agreement” shall mean that certain Letter Agreement, dated as of February 20,
2008, among Inland, LMLP and LMLP GP, as the same may be amended from time to time upon agreement
by each of the Partners.

     “Limited Partner” is defined in the Preamble hereto.

     “Liquidating Events” is defined in Section 9.1 hereof.

     “Liquidation” shall mean (a) when used with respect to the Partnership, the date upon
which the Partnership ceases to be a going concern, and (b) when used with respect to any Partner,
the earlier of (i) the date upon which there is a Liquidation of the Partner and (ii) the date upon
which such Partner’s entire interest in the Partnership is terminated other than by transfer,
assignment or other disposition to a Person other than the Partnership.

     “Liquidator” shall mean any Person designated as such by a Supermajority Vote of the
Executive Committee.

     “Losses” and “Profits” are defined in Section 6.2(b) hereof.

     “LMLP” is defined in the Preamble hereto.

     “LMLP Affiliated Party” shall mean any LMLP Partner, the Asset Manager and/or any of
their respective Affiliates (but shall in no event include the Partnership, any SP Subsidiary,
Inland or any of its Affiliates).

     “LMLP GP” is defined in the Preamble hereto.

     “LMLP Partner” is defined in the Preamble hereto.

     “LMLP Priority Return” is defined in Section 7.1(b)(i)(C) hereof.

9

 

     “LMLP Sale Affiliates” shall mean the LMLP Affiliates set forth on Schedule
2.8 hereto that are selling the Qualified Sale Assets to the Partnership pursuant to
Section 2.8 hereof.

     “LXP” shall mean Lexington Realty Trust, a Maryland real estate investment trust, or
its successors or assigns.

     “Major Decision” is defined in Section 3.4 hereof.

     “Majority Vote” shall mean the written consent of three (3) of the five (5) members of
the Executive Committee.

     “Management Agreement” shall mean the Management Agreement, dated as of August 10,
2007, between the Asset Manager and the Partnership, a copy of which is attached as Exhibit
C hereto, and the agreement between any subsequent Asset Manager and the Partnership, which
shall be substantially in the form as the Management Agreement attached hereto as
Exhibit C, and which shall in all cases provide that the Management Agreement may be
terminated by the Partnership at any time and the terms of which shall be monitored and enforced by
the General Partner.

     “Management Fees” shall mean the Property Management Fee and the Partnership
Management Fee.

     “Material Modification” shall mean a modification relating to the treatment of Capital
Accounts, distributions and/or allocations hereunder which, when considered on a cumulative basis
with the effect of all other such modifications previously made, is likely to adversely affect the
amount ultimately distributable or paid to any Partner hereunder as determined by the independent
accountants of the Partnership.

     “Net Cash Flow” shall mean Net Cash Flow from Operations and Net Cash Flow from Sales
and Refinancings.

     “Net Cash Flow from Operations” shall mean Net Cash Flow from Operations of Qualified
Acquired Assets and Net Cash Flow from Operations of Qualified Assumed Assets.

     “Net Cash Flow from Operations of Qualified Acquired Assets” shall mean the gross
revenues from Qualified Acquired Assets (excluding sales or other dispositions or refinancings of
Qualified Acquired Assets) less, without duplication, the sum of any portion thereof used to (a)
pay Operating Expenses, capital improvements, replacements or debt payments related to the
Qualified Acquired Assets or the Qualified Acquired Assets Portion thereof; (b) pay the Qualified
Acquired Assets Portion of (i) the general and administrative costs and overhead of the
Partnership, (ii) any Management Fees payable to the General Partner or Asset Manager pursuant to
Section 3.10 hereof, (iii) any credits reserved pursuant to Section 3.10 hereof,
indemnities and other extraordinary payments made pursuant to this Agreement; or
(c) establish reasonable reserves for Operating Expenses, capital improvements, replacements,
debt payments and contingencies as provided in the Annual Plan, in each case related to the
Qualified Acquired Assets or the Qualified Acquired Assets Portion thereof, as such reserves are
calculated, established and maintained by the General Partner pursuant to Section 3.4.
“Net

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Cash Flow from Operations of Qualified Acquired Assets” shall not be reduced by real estate
depreciation or by cost amortization, cost recovery deductions or similar allowances related to the
Qualified Acquired Assets, but shall be increased by any related reduction of reserves related to
the Qualified Acquired Assets previously described in an Annual Plan.

     “Net Cash Flow from Operations of Qualified Assumed Assets” shall mean the gross
revenues from Qualified Assumed Assets (excluding sales or other dispositions or refinancings of
Qualified Assumed Assets) less, without duplication, the sum of any portion thereof used to (a) pay
Operating Expenses, capital improvements, replacements or debt payments related to the Qualified
Assumed Assets or the Qualified Assumed Assets portion thereof; (b) pay the Qualified Assumed
Assets Portion of (i) the general and administrative costs and overhead of the Partnership, (ii)
any Management Fees payable to the General Partner or Asset Manager pursuant to
Section 3.10 hereof, (iii) any credits reserved pursuant to Section 3.10 hereof,
indemnities and other extraordinary payments made pursuant to this Agreement; or (c) establish
reasonable reserves for Operating Expenses, capital improvements, replacements, debt payments and
contingencies as provided in the Annual Plan, in each case related to the Qualified Assumed Assets
or the Qualified Assumed Assets Portion thereof, as such reserves are calculated, established and
maintained by the General Partner pursuant to Section 3.4. “Net Cash Flow from Operations
of Qualified Assumed Assets” shall not be reduced by real estate depreciation or by cost
amortization, cost recovery deductions or similar allowances related to the Qualified Assumed
Assets, but shall be increased by any related reduction of reserves related to the Qualified
Assumed Assets previously described in an Annual Plan.

     “Net Cash Flow from Sales or Refinancings” shall mean Net Cash Flow from Sales or
Refinancings of Qualified Acquired Assets and Net Cash Flow from Sales or Refinancings of Qualified
Assumed Assets.

     “Net Cash from Sales or Refinancings of Qualified Acquired Assets” shall mean the
gross cash proceeds from the sale or other disposition or refinancing or repayment or exercise of
Qualified Acquired Assets less (a) any closing, transaction and other costs incurred by the
Partnership in connection with such sale or other disposition or refinancing or repayment or
exercise, as the case may be; (b) the amount required to retire any debt outstanding against such
Qualified Acquired Assets; and (c) any amounts required to fund any related reserves up to the
levels required. Net Cash from Sales or Refinancings of Qualified Acquired Assets shall be
increased by releases of reserves previously funded from Net Cash from Sales or Refinancings of
Qualified Acquired Assets. “Net Cash from Sales or Refinancings of Qualified Acquired Assets”
shall include all principal and interest payments made with respect to any note or other obligation
received by the Partnership in connection with the sale or other disposition of any Qualified
Acquired Asset.

     “Net Cash from Sales or Refinancings of Qualified Assumed Assets” shall mean the gross
cash proceeds from the sale or other disposition or refinancing or repayment or exercise of
Qualified Assumed Assets less (a) any closing, transaction and other costs incurred
by the Partnership in connection with such sale or other disposition or refinancing or
repayment or exercise, as the case may be; (b) the amount required to retire any debt outstanding
against such Qualified Assumed Assets; and (c) any amounts required to fund any related reserves up
to the levels required. Net Cash from Sales or Refinancings of Qualified Assumed Assets shall be

11

 

increased by releases of reserves previously funded from Net Cash from Sales or Refinancings of
Qualified Assumed Assets. “Net Cash from Sales or Refinancings of Qualified Assumed Assets” shall
include all principal and interest payments made with respect to any note or other obligation
received by the Partnership in connection with the sale or other disposition of any Qualified
Assumed Asset.

     “9% Cash on Cash Return” shall mean, with respect to either Inland or LMLP a return
sufficient to achieve a 9% cash on cash annual yield calculated by dividing (a) Distributable Cash
distributed to such Partner by (b) the Capital Contributions (including credited amounts under
Section 3.10 hereof) made, plus, (i) solely with respect to Inland, the Acquisition Fees
(if any) paid by Inland, or (ii) solely with respect to LMLP, 17.65% of the amount the Acquisition
Fees (if any) paid by Inland; provided, that if the Partnership fails to (i) make a distribution to
either Inland or LMLP in an amount equal to the applicable 9% Cash on Cash Return on a Distribution
Date, such amount shall accrue, and such Partner shall be entitled to additional distributions on
such accrued amount, at the rate of 9% per annum compounded quarterly. For purposes of calculating
Inland’s 9% Cash on Cash Return, clause (b) hereof shall be increased by the outstanding Cap
Ex/Lease Assumed Asset Amount. For the avoidance of doubt, the amount of Capital Contributions
under clause (b) herein shall not include the outstanding amount, if any, of Preferred Equity
Capital Contributions for purposes of calculating the 9% Cash on Cash Return.

     “Nonrecourse Liability” shall mean any Partnership liability (or portion thereof) the
Economic Risk of Loss of which is not borne by any Partner or any party related to any Partner, as
such related party is described in the applicable Regulations under Code Section 752.

     “Non-Parameter Asset” is defined in Section 3.6(c) hereof.

     “Offer Price” shall mean the ROFO Offer Price or the Buy/Sell Offer Price, as
applicable.

     “Offered Agreement” is defined in Section 11.2(a) hereof.

     “O.P. Unit” shall mean a partnership interest in a partnership in which LXP or its
Affiliate is a partner.

     “Operating Expenses” shall mean (a) all reasonable and customary costs and expenses of
Third Parties retained in connection with the ownership, leasing, operation, repair and maintenance
of the Qualified Assets and (b) real estate taxes, insurance premiums, utility charges, rent
collection and lease enforcement costs, brokerage commissions to the extent applicable to the
period in question (but excluding any Acquisition Fees payable to the Asset Manager under
Section 3.6(g) hereof), maintenance expenses, costs of repairs and replacements (which,
under generally accepted accounting principles consistently applied, may be expensed during the
period when made) and management fees (including any Management Fees payable to
the Asset Manager pursuant to Section 3.10 hereof) in connection with the ownership,
leasing, operation, repair and maintenance of the Qualified Assets. Operating Expenses shall not
include general and administrative costs and overhead of the Partnership and debt payments.

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     “Other Partner(s)” in respect of either or both of the LMLP Partners shall mean Inland
and in respect of Inland shall mean either or both of the LMLP Partners.

     “Partially Adjusted Capital Account” shall mean, with respect to any Partner for any
taxable year of the Partnership, the Capital Account balance of such Partner at the beginning of
such year, adjusted for all contributions and distributions during such year and all special
allocations pursuant to Section 6.3 hereof with respect to such year but before giving
effect to any allocations pursuant to Section 6.2 hereof with respect to such year.

     “Partner” is defined in the Preamble hereto.

     “Partner Nonrecourse Debt” shall have the meaning set forth in Regulations
Section 1.704-2(b)(4).

     “Partner Nonrecourse Debt Minimum Gain” shall have the meaning set forth in
Regulations Section 1.704-2(i)(2).

     “Partner Nonrecourse Deductions” is defined in Section 6.3(d) hereof.

     “Partnership” is defined in the Preamble hereto.

     “Partnership Management Fee” is defined in Section 3.10(b) hereof.

     “Partnership Minimum Gain” shall have the meaning set forth in Section 1.704-2(b)(2)
and (d) of the Regulations.

     “Percentage Interest” shall mean the entire undivided ownership interest in the
Partnership of any Partner at any particular time, (a) expressed as a percentage rounded to the
nearest one one-hundredth (0.01%), (b) determined at such time by dividing the total Capital
Contributions (excluding Preferred Equity Capital Contributions) made by such Partner by the total
Capital Contributions (excluding Preferred Equity Capital Contributions) made to the Partnership by
all Partners and (z) as may be adjusted from time to time in accordance with the terms hereof. The
Percentage Interest of each Partner as of the date first set forth above shall be as described on
Schedule 1 hereto (without regard to the Preferred Equity Capital Contribution).

     “Permitted Expenses” shall mean, for each annual period covered by an Annual Plan,
Operating Expenses, capital improvements, replacements and debt payments as set forth therein plus,
with respect to each budget line item in the Annual Budget portion of such Annual Plan, the greater
of (a) five percent (5%) of each such budget line item or (b) Twenty Thousand Dollars ($20,000.00);
provided, however, that the aggregate Permitted Expenses (other than the Management Fees
payable to the Asset Manager pursuant to Section 3.10 hereof), when added to all other
obligations incurred or reserve amounts accrued in excess of the applicable budget line items in
such Annual Budget portion of the Annual Plan, shall not exceed (i) One Hundred Thousand Dollars
($100,000) in any fiscal year for a particular Qualified Asset or (ii) an average
(taking into account all Qualified Assets then owned by the Partnership) of Fifty Thousand
Dollars ($50,000) per Qualified Asset. Permitted Expenses shall also mean (a) all reasonable and
customary costs and expenses of Third Parties retained in connection with the Acquisition
Activities as provided in Section 3.6(f) hereof, (b) any reasonable costs or expenses
incurred in

13

 

implementing a Major Decision approved as provided in Section 3.4 hereof and
not otherwise already included in an Annual Plan, and (c) costs and expenses incurred by and on
behalf of the Partnership in connection with the formation of the Partnership, including legal fees
and costs and expenses associated with assumption or refinancing the Existing Indebtedness, but
excluding fees and expenses set forth in Section 12.16 hereof.

     “Person” shall mean any individual, trust (including a business trust), unincorporated
association, corporation, limited liability company, joint stock company, general partnership,
limited partnership, joint venture, governmental authority or other entity.

     “Physical Inspection Report” shall mean a report prepared by a qualified independent
third party engineer, architect or other real estate inspector selected by the General Partner
concerning the physical condition of any Proposed Qualified Asset.

     “Plan Amendment” is defined in Section 3.5(c).

     “Preferred Equity” shall mean the Preferred Equity Capital Contribution by LMLP
pursuant to Section 5.2 hereof.

     “Preferred Equity Capital Contribution” shall mean the contribution to the Partnership
by LMLP pursuant to Section 5.2 hereto.

     “Preferred Equity Redemption Amount” shall mean one hundred and twenty five (125%)
percent of the allocated amount of the outstanding Preferred Equity Capital Contribution set forth
opposite a Qualified Assumed Asset on Schedule 1 hereto; provided, that for the purposes of
Section 3.8(e) hereof only, if LMLP is no longer the General Partner because of an Event of
Default caused by an LMLP Partner or an LMLP Affiliated Party, then the Preferred Equity Redemption
Amount shall mean one hundred percent (100%) of the allocated amount of the Outstanding Preferred
Equity Capital Contribution set forth opposite a Qualified Assumed Asset on Schedule 1
hereto.

     “Preferred Equity Return” shall mean a cumulative distribution on the outstanding
Preferred Equity paid quarterly in accordance with Section 7.1 hereof at a rate of 6.5% per
annum; provided, that if the Partnership fails to (i) make a distribution to LMLP in an amount
equal to the Preferred Equity Return on a Distribution Date, such amount shall accrue, and LMLP
shall be entitled to additional distributions on such accrued amount, at the rate of 6.5% per annum
compounded quarterly, or (ii) redeem any Preferred Equity when such redemption is required
hereunder, such redemption amount shall accrue, and LMLP shall be entitled to additional
distributions on such accrued amount, at the rate of 10.5% per annum compounded quarterly.

     “Prior Agreement” is defined in the Preamble hereto.

     “Priority Loan” is defined in Section 5.1(a) hereof.

     “Priority Return” shall mean the Inland Priority Return and/or the LMLP Priority
Return, as applicable.

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     “Profits” and “Losses” are defined in Section 6.2(b) hereof.

     “Property Management Fee” is defined in Section 3.10(a) hereof.

     “Proposed Plan” is defined in Section 3.5(a) hereof.

     “Proposed Qualified Asset” is defined in Section 3.6(a) hereof.

     “Purchase Agreement” shall mean the Purchase Agreement, dated as of August 10, 2007,
pursuant to which the Partnership purchases the Qualified Sale Assets from the LMLP Sale Affiliates
pursuant to Section 2.8 hereof and a copy of which is attached as Exhibit D to this
Agreement.

     “Purchasing Partner” shall mean the purchasing Partner under Section 11.1 or
Section 11.2 hereof, as the case may be.

     “Purchase Price” shall mean (a) with respect to each Qualified Contribution Asset, the
Contribution Value which will be set forth on Schedule 1 to the Contribution Agreement upon
acquisition of the Qualified Contribution Asset, (b) with respect to each Qualified Sale Asset, the
Sales Price which will be set forth on Schedule 1 to the Purchase Agreement upon acquisition of the
Qualified Sale Asset, and (c) with respect to each other Qualified Asset, the gross purchase cost
of the Qualified Asset.

     “Qualified Acquired Assets” shall mean the Qualified Assets acquired by the
Partnership pursuant to Section 3.6 hereof, but shall not include Qualified Assumed Assets.

     “Qualified Acquired Assets Portion” shall mean a portion of an applicable amount
determined by dividing such amount by a quotient, the numerator of which is the gross acquisition
cost of the Qualified Acquired Assets and the denominator of which is the gross acquisition cost of
the Qualified Assets.

     “Qualified Asset” or “Qualified Assets” shall mean the direct or indirect
interest of the Partnership in (a) each Approved Qualified Asset and Non-Parameter Asset acquired
by the Partnership pursuant to Section 3.6 hereof, and (b) the Qualified Assumed Assets.

     “Qualified Assumed Assets” shall mean the Qualified Contribution Assets and the
Qualified Sale Assets.

     “Qualified Assumed Assets Portion” shall mean a portion of an applicable amount
determined by dividing such amount by a quotient, the numerator of which is the gross acquisition
cost of the Qualified Assumed Assets and the denominator of which is the gross acquisition cost of
the Qualified Assets.

     “Qualified Contribution Assets” shall mean the assets set forth on Schedule 1,
each of which shall be a Qualified Asset upon contribution to the Partnership pursuant to the
Contribution Agreement and Section 5.1(a) hereof.

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     “Qualified Sale Assets” shall mean the interests of the LMLP Sale Affiliates in the
assets set forth on Schedule 2.8, each of which shall be a Qualified Asset upon acquisition
by the Partnership pursuant to the Purchase Agreement.

     “Recoverable Amounts” is defined in Section 3.10(a) hereof.

     “Regulations” shall mean the income tax regulations promulgated under the Code,
whether temporary, proposed or finalized, as such regulations may be amended from time to time
(including corresponding provisions of future regulations).

     “Regulatory Allocations” is defined in Section 6.3(f) hereof.

     “REIT” shall mean “real estate investment trust” within the meaning of Sections
856-860 of the Code.

     “Remaining Qualified Assumed Assets Capital Contribution” shall mean, (a) with respect
to Inland, the amount of cash and (b) with respect to each LMLP Partner, the amount of cash and/or
the amount of the Contribution Value (as defined in the Contribution Agreement), in each case as
pursuant to Section 5.1(a) hereof and made prior to June 30, 2008 and as set forth on
Schedule 1 hereto, which shall be amended and restated to reflect each the acquisition of
each Qualified Assumed Asset acquired after the date hereof.

     “Removal Event” shall mean (a) an Event of Default caused by an LMLP Partner or an
LMLP Affiliated Party or (b) a Change of Control.

     “Required Third Party Price” is defined in Section 11.1(a) hereof.

     “Responding Partner” shall mean the ROFO Responding Partner or the Buy/Sell Responding
Partner, as applicable.

     “Rights Trigger Date” shall mean the earliest of the following: (a) the fourth
anniversary of the date first set forth above; (b) an Event of Default; (c) a Change of Control;
(d) termination of the Management Agreement by the Partnership; and (e) a Removal Event.

     “ROFO Notice” is defined in Section 11.1(a) hereof.

     “ROFO Offer Price” is defined in Section 11.1(a) hereof.

     “ROFO Offering Partner” is defined in Section 11.1(a) hereof.

     “ROFO Responding Partner” is defined in Section 11.1(a) hereof.

     “ROFO Response Notice” is defined in Section 11.1(a) hereof.

     “ROFO Terms” is defined in Section 11.1(a) hereof.

     “Section 704(c) Property” shall mean (a) each item of property to which Section 704(c)
of the Code or Section 1.704-3(a)(3) of the Regulations applies that is contributed to the
Partnership, and (b) any property owned by the Partnership which is governed by the principles of
Section 704(c) of the Code, as contemplated by Section 1.704-1(b)(4)(i) and other analogous
provisions of the Regulations.

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     “Selling Partner” shall mean the selling Partner under Section 11.1 or
Section 11.2 hereof, as the case may be.

     “SP Subsidiary” shall mean an entity selected by the General Partner which shall be
wholly-owned (directly or indirectly) by the Partnership, the purpose of which is limited to
acquiring, financing, holding for investment, preserving, managing, operating, improving, leasing,
selling, exchanging, transferring and otherwise using or disposing of a Qualified Asset or
Qualified Assets.

     “SP Subsidiary Limited Liability Company Agreement” shall mean the limited liability
company agreement of an SP Subsidiary that is the general partner of another SP Subsidiary, which,
except as provided in Section 3.4 hereof, shall be substantially in the form attached
hereto as Exhibit E.

     “SP Subsidiary Partnership Agreement” shall mean the limited partnership agreement of
an SP Subsidiary that is the owner of a Qualified Asset, which, except as provided in Section
3.4 hereof, shall be substantially in the form attached hereto as Exhibit F.

     “SP Subsidiary Agreements” shall mean the SP Subsidiary Limited Liability Company
Agreements and the SP Subsidiary Partnership Agreements.

     “Supermajority Vote” shall mean the written consent of four (4) of the five (5)
members of the Executive Committee.

     “Target Account” shall mean, with respect to any Partner for any taxable year of the
Partnership, the excess of (a) an amount (which may be either a positive balance or a negative
balance) equal to the hypothetical distribution (or contribution) such Partner would receive (or
contribute) if all assets of the Partnership, including cash, were sold for cash equal to their
Book Basis (taking into account any adjustments to Book Basis for such year), all liabilities
(including prepayment penalties, yield maintenance fees and similar costs) of the Partnership were
then satisfied according to their terms (except that if the nonrecourse liabilities secured by an
asset exceed the Book Basis of such asset, such calculation shall be made assuming that the asset
were transferred to the lender in satisfaction of the debt) and all remaining proceeds from such
sale were distributed pursuant to Section 9.2 over (b) such Partner’s share of Partnership
Minimum Gain and Partner Nonrecourse Debt Minimum Gain immediately prior to such sale.

     “Tax Depreciation” shall mean with respect to any property owned by the Partnership
depreciation, accelerated cost recovery, or modified cost recovery, and any other amortization or
deduction allowed or allowable for federal, state or local income tax purposes.

     “Tax Matters Partner” is defined in Section 6.5 hereof.

     “Third Parties” shall mean consultants, engineers, environmental consultants,
accountants, attorneys, contractors and subcontractors, brokers or managers, but excluding any LMLP
Affiliated Party.

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     “Third Party Sale Period” is defined in Section 11.1(b) hereof.

ARTICLE II

FORMATION, DURATION AND PURPOSES; PURCHASE OF INITIAL PROPERTIES

               Section 2.1 Formation. Pursuant to the Delaware Revised Uniform Limited Partnership
Act, codified in the Delaware Code Annotated, Title 6, Sections 17-101 to 17-1111, as the same may
be amended from time to time (the “Act”), the Partners agree to form and hereby form the
Partnership by entering into this Agreement. The Partners hereby acknowledge that a certificate of
limited partnership has been executed and filed in the office of the Delaware Secretary of State on
August 8, 2007. The execution and filing of such certificate of limited partnership with the
Delaware Secretary of State is hereby authorized, ratified and approved by the Partners. The
rights, liabilities and obligations of any Partner with respect to the Partnership shall be
determined in accordance with the Act and this Agreement. To the extent anything contained in this
Agreement modifies, supplements or otherwise affects any such right, liability, or obligation
arising under the Act, this Agreement shall supercede the Act to the extent not restricted thereby.

               Section 2.2 Name; Registered Agent and Registered Office. The name of the Partnership
and the name under which the business of the Partnership shall be conducted shall be “Net Lease
Strategic Assets Fund L.P.” The registered agent of the Partnership shall be Corporation Service
Company, and the registered office of the Partnership shall be at Corporation Service Company, 2711
Centerville Road, Suite 400, Wilmington, Delaware 19808. The General Partner may select another
such registered agent or registered office from time to time.

               Section 2.3 Principal Office. The principal place of business and office of the
Partnership shall be located at c/o The Lexington Master Limited Partnership, One Penn Plaza, Suite
4015, New York, New York 10119-4015, or at such other place as the General Partner may determine
from time to time. The business of the Partnership may also be conducted at such additional place
or places as the General Partner may determine.

               Section 2.4 Purposes and Business. The business of the Partnership is to, directly or
indirectly, acquire, finance, refinance, hold for investment, preserve, manage, operate, improve,
lease, sell, exchange, transfer and otherwise use or dispose of the Qualified Assets as may be,
directly or indirectly, acquired by the Partnership from time to time pursuant to the terms hereof,
which Qualified Assets may be located anywhere in the United States. In connection therewith and
without limiting the foregoing, the Partnership shall have the power to dispose of the Qualified
Assets in accordance with the terms of this Agreement and to engage in any and all activities
related or incidental thereto, all for the benefit of the Partners.

               Section 2.5 Term. The term of the Partnership shall commence on the date of this
Agreement and shall continue in full force and effect until terminated pursuant to the terms
hereof. No Partner may withdraw from the Partnership without the prior consent of the General
Partner, other than as expressly provided in this Agreement.

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               Section 2.6 Other Qualifications. The Partnership shall file or record such documents
and take such other actions under the laws of any jurisdiction in which the Partnership does
business as are necessary or desirable to permit the Partnership to do business in any such
jurisdiction and to promote the limitation of liability for the Partners in any such jurisdiction.

               Section 2.7 Limitation on the Rights of Partners. Except as otherwise specifically
provided in this Agreement, (a) no Partner shall have the right to withdraw or retire from, or
reduce its contribution to the capital of, the Partnership; (b) no Partner shall have the right to
demand or receive assets other than cash in return for its Capital Contribution; and (c) no Partner
shall have priority over any other Partner either as to the return of its Capital Contribution or
as to profits or distributions.

               Section 2.8 Purchase of Qualified Sale Assets. The LMLP Sale Affiliates have agreed
to sell, and the Partnership has agreed to purchase the Qualified Sale Assets described on
Schedule 2.8 hereto at the purchase prices set forth on Schedule 2.8 hereto
pursuant to the Purchase Agreement.

               Section 2.9 Remuneration To Partners. No Partner is entitled to remuneration for
acting on behalf of the Partnership. Except as otherwise authorized in this Agreement, including
but not limited to Sections 3.6 and 3.10, no Partner is entitled to remuneration
for acting in the Partnership business.

ARTICLE III

MANAGEMENT RIGHTS, DUTIES, AND POWERS

OF THE GENERAL PARTNER; TRANSACTIONS INVOLVING PARTNERS

               Section 3.1 Management.

               (a) Management by the General Partner. LMLP GP shall be the General Partner until
(x) a Removal Event, or (y) LMLP GP resigns as the General Partner. The General Partner shall
manage the investments, business and day-to-day affairs of the Partnership and shall be responsible
for acquisitions and dispositions of Qualified Assets, subject, however, to the provisions of
Section 3.4 hereof with respect to Major Decisions, of Section 3.6,
Section 3.7 and Article XI hereof with respect to the acquisition or sale of
Qualified Assets and any other provisions of this Agreement concerning the investments, business
and day-to-day affairs of the Partnership. The General Partner shall use commercially reasonable
efforts to manage the investments, business and day-to-day affairs of the Partnership in accordance
with the Annual Plan approved in accordance with Section 3.5 hereof. Any action taken by
the General Partner in accordance with the terms of this Agreement shall constitute the act of and
serve to bind the Partnership. The General Partner may delegate certain of the tasks that are to
be performed in connection with the acquisition of Qualified Assets, the management of the
Qualified Assets or the business and day-to-day affairs of the Partnership. Any such delegation to
third parties provided in the previous sentence shall be at the cost of the General Partner and
supervised by the General Partner and such delegation shall not relieve the General Partner of

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any
of its obligations hereunder. Any right of any Partner to consent to any action requiring its
consent hereunder shall not be diminished or otherwise affected by such delegation.

               (b) Delegation to the Executive Committee.

          (i) The Executive Committee shall be delegated the authority to exercise the authority
conferred on it by this Agreement. No member of the Executive Committee shall (x) have any
interest in or rights under this Agreement, (y) be admitted as a substitute for any Partner or (z)
have any of the rights of a Partner under the Act or this Agreement.

          (ii) Action requiring a Supermajority Vote by the Executive Committee shall be taken without a
meeting by a consent in writing setting forth the action taken, which shall be signed by at least
four (4) of the five (5) members of the Executive Committee. Action requiring a Majority Vote of
the Executive Committee shall be taken at a special meeting of the Executive Committee, upon not
less than five (5) Business Days’ prior written notice by the General Partner to the members of the
Executive Committee. Such meetings shall be held at the time specified in the notice at a location
selected by the General Partner or, if requested by any member of the Executive Committee, by
teleconference.

          (iii) Any member of the Executive Committee may resign at any time by giving written notice to
each Partner. The resignation of any member of the Executive Committee shall take effect upon
receipt of the notice thereof or at such later time as shall be specified in such notice; and,
unless otherwise specified therein, the acceptance of such resignation shall not be necessary to
make such resignation effective. The Partner who appointed the resigning Executive Committee
member shall appoint a replacement Executive Committee member within seven (7) Business Days of
such resignation. Any Partner who appointed an Executive Committee member may remove such member
at any time upon written notice to the other Partners, which notice shall name and appoint a new
Executive Committee member to replace the Executive Committee member so removed.

          (iv) The members of the Executive Committee shall not be entitled to receive any fees or
reimbursement for any expenses for their service in such capacity.

               (c) Delegation to the Asset Manager. The General Partner shall retain the Asset
Manager pursuant to a Management Agreement substantially in the from attached hereto as Exhibit
C and delegate (pursuant to Sections 3.1(a) and (b) above) to the Asset Manager
the management of the Qualified Assets and, during the Acquisition Period, the performance of the
tasks necessary for the evaluation of Proposed Qualified Assets and the acquisition of Approved
Qualified Assets as contemplated in Section 3.6 hereof. The Asset Manager shall (x) have
no interest in or rights under this Agreement, (y) not be admitted as a substitute for any Partner
and (z) not have any of the rights of a Partner under the Act or this Agreement. Any delegation to
the Asset Manager provided in this Section 3.1(b) shall be
supervised by the General Partner and the Executive Committee and such delegation shall not
relieve the General Partner of any of its obligations hereunder as General Partner.

20

 

               (d) Right to Rely on Authority of the General Partner. Any action taken by the
General Partner, acting on behalf of the Partnership pursuant to the authority conferred thereon in
this Agreement, shall be binding on the Partnership. In no event shall any Person dealing with the
General Partner with respect to the conduct of the affairs of the Partnership be obligated to
ascertain whether the terms of this Agreement have been complied with, or be obligated to inquire
into the necessity or expediency of any action of the General Partner.

               (e) Inland’s Right to Enforce Partnership Rights Against LMLP Affiliated Parties.
Notwithstanding anything herein to the contrary, if LMLP GP, in its capacity as General Partner,
has failed to enforce any of the Partnership’s rights against any LMLP Affiliated Party that has
defaulted on any obligation owed to the Partnership under this Agreement, the Contribution
Agreement, the Purchase Agreement or any agreement between the Partnership and any LMLP Affiliated
Party (including the Management Agreement), Inland shall be entitled to exercise, on behalf of the
Partnership and at the expense of the Partnership, the Partnership’s rights and obligations arising
under such agreements all without the consent or approval of LMLP GP or the Executive Committee.

               Section 3.2 Actions of the General Partner.

               (a) Acts of the General Partner. Any action required or permitted to be taken by the
General Partner shall be taken by written consent of the General Partner, and the writing or
writings shall be filed with the books and records of the Partnership.

               (b) General Informational Meetings. The General Partner shall hold informational
meetings with the Partners to review and discuss the Partnership’s activities and business at least
once annually and, so long as LMLP GP is the general partner and if requested by Inland upon not
less than ten (10) Business Days’ prior written notice, at least once quarterly. Such meetings
shall be held at a mutually convenient time at a location selected by the General Partner and
teleconferencing will be made available.

               Section 3.3 Authority of the General Partner.

               (a) Except as otherwise provided in this Article III, the General Partner is hereby
authorized to do the following, for and in the name and on behalf of the Partnership, as may be
necessary, convenient or incidental to the implementation of the Annual Plan or to the
accomplishment of the purposes of the Partnership (provided, that if any of the following
constitutes a Major Decision that is not specifically set forth in the Annual Plan, the General
Partner shall first obtain the consent of the Executive Committee pursuant to Section 3.4
hereof):

          (i) enter into a good faith non-binding letter of intent concerning the acquisition of a
Proposed Qualified Asset.

          (ii) acquire by purchase, exchange or otherwise, any Proposed Qualified Asset consistent with
the purposes of the Partnership, but only in accordance with Sections 3.4 and  3.6
hereof;

21

 

          (iii) operate, manage and maintain each of the Qualified Assets;

          (iv) take such action as is necessary to form, create or set up any SP Subsidiary that has
been approved in accordance with Section 3.6 hereof;

          (v) dissolve, terminate or wind-up any SP Subsidiary, provided that any Qualified
Asset held by such SP Subsidiary has been disposed of in accordance with Article XI hereof
or transferred to the Partnership or any other SP Subsidiary;

          (vi) enter into, amend, extend or renew any lease of any Qualified Asset or any part thereof
or interest therein approved as part of the Annual Plan;

          (vii) initiate legal proceedings or arbitration with respect to any lease of any Qualified
Asset or part thereof or interest therein; provided that the initiation of such legal
proceedings or arbitration shall have arisen (x) in connection with any matter of an emergency
nature, (y) for the collection of rent or (z) involving an uninsured claim of less than $100,000;

          (viii) dispose of any or all of the Qualified Assets by sale, lease, exchange or otherwise,
and grant an option for the sale, lease, exchange or otherwise of any or all the Qualified Assets,
but only in accordance with Section 3.7 hereof;

          (ix) employ and dismiss from employment any and all employees, agents, independent
contractors, attorneys and, subject to Section 3.4 hereof, independent accountants for the
Partnership;

          (x) pay all Permitted Expenses (and maintain in reserve the amount of any credits pursuant to
Section 3.10 hereof);

          (xi) execute and deliver any and all agreements, contracts, documents, certifications and
instruments necessary or convenient in connection with the management, maintenance and ownership of
the Qualified Assets and in connection with any other matters with respect to which the General
Partner has authority to act pursuant to the Annual Plan or as set forth in this
Section 3.3;

          (xii) draw down funds as needed under any approved lines of credit or other financing
previously approved under Section 3.4 hereof;

          (xiii) finance or refinance a portion of the purchase price of any Qualified Asset and incur
(and refinance) indebtedness secured by any Qualified Asset, or any portion thereof or any interest
or estate therein and incur any other secured or unsecured borrowings or other indebtedness;

          (xiv) implement those Major Decisions that are specifically set forth in the Annual Plan or
that have been approved by the Executive Committee pursuant to Section 3.4 below; and

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          (xv) subject to any conditions expressly provided in this Agreement, engage in any kind of
activity and perform and carry out contracts of any kind necessary or incidental to or in
connection with the accomplishment of the purposes of the Partnership as may be lawfully carried
out or performed by a limited partnership under the laws of each state in which the Partnership is
then formed or registered or qualified to do business.

               Section 3.4 Major Decisions.

               (a) Major Decisions. Notwithstanding anything to the contrary contained in this
Agreement, but subject to Section 3.4(b), Section 3.8(e) and Section 3.8(f)
hereof, the General Partner shall not take, on behalf of the Partnership, and shall not permit the
Partnership or the Asset Manager to take, any action, make any decision, expend any sum or
undertake or suffer any obligation which comes within the scope of any Major Decision unless such
Major Decision is approved by the Executive Committee in the manner required by Section
3.4(b) in advance in writing or as specifically set forth in the Annual Plan.

               As used herein, “Major Decision” shall mean a decision to take any of the following actions
directly or indirectly through or for an SP Subsidiary:

          (i) the acquisition (including any decisions under Section 3.6) by purchase, exchange
or otherwise of any Qualified Asset or other asset and except for the acquisition of the Qualified
Assumed Assets; provided that acquisitions of Qualified Assets shall only occur during the
Acquisition Period;

          (ii) the construction, alteration, improvement, repair, rehabilitation, razing, rebuilding or
replacement of any building or other improvements or the making of any capital improvements,
replacements, repairs, alterations or changes in, to or on any Qualified Asset, or any part
thereof, except to the extent provided for in the Annual Plan; provided that repairs of an
emergency nature may be undertaken without prior approval of a majority of the members of the
Executive Committee provided the General Partner notifies each member of the Executive Committee in
writing thereof within two (2) Business Days following the commencement of such emergency repairs;

          (iii) the reinvestment for restoration purposes of (i) insurance proceeds in excess of
$500,000 received by the Partnership in connection with the damage or destruction of any Qualified
Asset or (ii) condemnation proceeds in excess of $500,000 received by the Partnership in connection
with the taking or settlement in lieu of a threatened taking of all or any portion of any Qualified
Asset; provided that (x) if the determination is made not to reinvest any such insurance or
condemnation proceeds, then so much thereof as may be necessary shall be applied to the razing or
other disposition of the remaining improvements as may be required by law or by a reasonably
prudent property manager and the balance of such insurance or condemnation proceeds shall be
distributed in
accordance with this Agreement and (y) any distribution of such insurance or condemnation
proceeds shall be made in accordance with Section 7.1(c) hereof.

          (iv) the commencement of any case, proceeding or other action seeking protection for the
Partnership as debtor under any existing or future law of any

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jurisdiction relating to Bankruptcy,
insolvency, reorganization or relief of debtors; any consent to the entry of an order for relief in
or institution of any case, proceeding or other action brought by any third party against the
Partnership as a debtor under any existing or future law of any jurisdiction relating to
Bankruptcy, insolvency, reorganization or relief of debtors; the filing of an answer in any
involuntary case or proceeding described in the previous clause admitting the material allegations
of the petition therefor or otherwise failing to contest any such involuntary case or proceeding;
the seeking of or consent to the appointment of a receiver, liquidator, assignee, trustee,
sequestrator, custodian or any similar official for the Partnership or for a substantial portion of
its Qualified Assets; any assignment for the benefit of the creditors of the Partnership; or the
admission in writing that the Partnership is unable to pay its debts as they mature or that the
Partnership is not paying its debts as they become due;

          (v) the extension of the statute of limitations for assessing or computing any tax liability
against the Partnership or the amount of any Partnership tax item or to settle any dispute with
respect to any income, or any other material, tax;

          (vi) a merger, sale or recapitalization of the Partnership or a sale or other disposition,
including a disposition by lease, of any or all of the Qualified Assets, except in accordance with
Article XI hereof;

          (vii) the financing or refinancing of, or the increasing of any mortgage indebtedness
encumbering, any Qualified Asset, or any portion thereof or any interest or estate therein, whether
recourse or non-recourse to the Partnership, or the incurrence of indebtedness secured by any
Qualified Asset, or any portion thereof or any interest or estate therein, or the incurrence of any
other secured or unsecured borrowings or other indebtedness by the Partnership, including
determination of the terms and conditions thereof, and any amendments to such terms and conditions
or otherwise with respect to anything in this clause (vii) except (A) in accordance with
Section 3.8(f) hereof or (B) as contemplated in an Annual Plan or in accordance with
Section 3.4 hereof;

          (viii) the approval of the Annual Plan, including any budget line item, and any amendment to
the Annual Plan;

          (ix) the incurring of any cost or expense for any fiscal year, other than a Permitted Expense;

          (x) the entering into of any transaction or agreement with or for the benefit of, or the
employment or engagement of, any LMLP Affiliated Party, except as expressly contemplated in
Sections 3.1(c) and 3.10 hereof;

          (xi) except as required by the lenders under the loan documents governing indebtedness of the
Partnership, the establishment of a reserve for working
capital, capital expenditures or to pay other costs and expenses incident to ownership of the
Qualified Assets and for such other Partnership purposes in excess of an aggregate of (A) $100,000
or (B) $500,000;

          (xii) the initiation of legal proceedings or arbitration by the Partnership or the settlement
of any litigation against the Partnership involving an uninsured

24

 

claim in excess of (A) $100,000 or
(B) $500,000; provided that the initiation of such legal proceedings or arbitration (x) in
connection with any matter of an emergency nature, or (y) for the collection of rent, shall not be
a Major Decision subject to this Section 3.4(a);

          (xiii) with respect to any lease of any Qualified Asset, or part thereof or interest therein,
the entering into, amending, extending or renewing thereof, in each case not already approved as
part of the Annual Plan;

          (xiv) the admission of a new Partner to the Partnership or acquisition by an existing Partner
of an additional interest in the Partnership, except in accordance with Article VIII and XI
hereof;

          (xv) the engagement of an accounting firm to audit the financial statements of the
Partnership;

          (xvi) the extension of the Acquisition Period, which decision to extend shall be made not less
than 60 days prior to the end of the Acquisition Period;

          (xvii) making an Extraordinary Call to the Partners to fund an operating deficit of the
Partnership in excess of the Extraordinary Call Cap;

          (xviii) except in connection with items set forth in the Annual Budget or items constituting a
Permitted Expense, the entry into any agreement by the Partnership involving more than $100,000 of
consideration or having a term in excess of 1 year and in all cases any property management
agreement or brokerage agreement;

          (xix) the winding up or dissolution of the Partnership;

          (xx) any deviation from the SP Subsidiary Agreements, which directly or indirectly impairs the
economic or management rights of the Partnership; and

          (xxi) subject to Section 3.3 hereof, the execution of any agreement, contract or
understanding or other arrangement to effectuate a Major Decision.

                    (b) Vote Required. Major Decisions shall require the following approvals:

               (i) A Supermajority Vote shall be required for the Major Decisions set forth in Section
3.4(a)(i)-(iv), (vi)-(x), (xi)(B), (xii)(B) and (xiii)-(xxi).

               (ii) A Majority Vote shall be required for the Major Decisions set forth in Section 3.4
(v), (xi)(A) and (xii)(A).

                    (c) Non-Binding Letters of Intent. Notwithstanding the foregoing, the General Partner
shall be authorized to execute non-binding letters of intent with respect to property and
operational actions that constitute Major Decisions.

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               Section 3.5 Preliminary and Annual Plans.

               (a) Preparation and Approval of Plans. The General Partner shall prepare and deliver
to the Executive Committee for its approval or disapproval a proposed annual plan for the next
fiscal year of the Partnership (as further described below, a “Proposed Plan”). The Proposed Plan
shall cover the Partnership and each Qualified Asset and shall include:

          (i) a proposed Annual Budget covering the Partnership and each Qualified Asset and a brief
narrative description of the material portions thereof;

          (ii) a plan of operations for each Qualified Asset, including anticipated repairs and
improvements;

          (iii) estimated financing needs and estimated financing costs for the Partnership and each
Qualified Asset;

          (iv) estimated cash flow projections for the Partnership and each Qualified Asset;

          (v) a description of tenants then in occupancy in each Qualified Asset;

          (vi) a schedule of Qualified Assets, any leases which are expiring during such fiscal year and
the plans for the re-leasing of such Qualified Assets and any lease restructures (such as
subleasing or expansion by a tenant) of which the General Partner is aware;

          (vii) projected capital improvements and capital repairs;

          (viii) a description of any Proposed Qualified Assets to the extent identified, including the
terms of acquisition, provided that nothing in the Proposed Plan shall affect or limit the
provisions of Section 3.6 hereof; and

          (ix) any other information relative to the management of the Qualified Assets or the
Partnership reasonably requested by any member of the Executive Committee.

               The General Partner shall prepare and submit a Proposed Plan to the Executive Committee on or
before November 15th of the year prior to such fiscal year. The Executive Committee shall approve
or disapprove such revised Proposed Plan no later than December 15th of the year prior to the
fiscal year covered by such revised Proposed Plan. Any Proposed Plan approved by the Executive
Committee in accordance with Section 3.4 shall become the annual plan for the next fiscal
year of the Partnership (any Proposed Plan approved
by the Executive Committee for any fiscal year of the Partnership, and as may be amended from
time to time by a Plan Amendment, an “Annual Plan”). A model of an Annual Plan is attached as
Schedule 3.5 and made a part hereof. The General Partner, within thirty (30) days after
the closing of the last to be acquired of Qualified Assumed Assets, shall submit the initial Annual

26

 

Plan, covering all of the Qualified Assets held by the Partnership for the remainder of the then
current year, to the Executive Committee for approval or disapproval in accordance with the
procedures outlined herein which Proposed Plan upon approval shall become the Annual Plan.

               (b) Dispute Concerning an Annual Budget. If, prior to the commencement of any fiscal
year, the Executive Committee has disapproved the Proposed Plan because it could not reach an
agreement as to the amount to be allocated to any budget line item set forth in the Annual Budget
portion of the Proposed Plan for such fiscal year, then (i) as to any such disputed budget line
item, the Annual Budget portion of the Annual Plan for the immediately preceding fiscal year
(exclusive of any non-recurring capital expenditures) shall be controlling but only with respect to
such disputed budget line item (in each case adjusted to reflect the increases in the CPI for
November of such fiscal year over the CPI for November of such immediately preceding fiscal year)
and only until such time as the Executive Committee has approved the amount to be allocated to such
budget line item, and (ii) as to any budget line item or items that are not in dispute, the Annual
Budget portion of the Proposed Plan shall control.

               (c) Amendments to Annual Plans. If in any Partner’s judgment an Annual Plan requires
amendment, such Partner shall deliver to the Executive Committee a written notice setting forth the
proposed amendment to the Annual Plan and the basis therefor. The Executive Committee shall
approve or disapprove, in accordance with Section 3.4 hereof, such proposed amendment
within ten (10) Business Days after receipt thereof, and, if the Executive Committee shall approve
such proposed amendment (any such amendment, a “Plan Amendment”), the Annual Plan (including,
without limitation any amendments to the Annual Budget portion thereof) shall be amended by the
Plan Amendment as set forth in the written notice described in the preceding sentence. If the
Executive Committee shall disapprove a Plan Amendment, then the Annual Plan then in effect shall
not be amended pursuant to such disapproved Plan Amendment.

               Section 3.6 Qualified Asset Acquisitions. 

               (a) Generally; Approval by Executive Committee. During the Acquisition Period, LMLP
GP shall identify net-leased assets that meet the Acquisition Parameters as candidates for
acquisition, directly or indirectly, by the Partnership (any such asset, a “Proposed Qualified
Asset”). LMLP GP or Asset Manager shall submit the Acquisition Memorandum described in
Section 3.6(b) hereof with respect to the Proposed Qualified Asset or a Non-Parameter Asset
that LMLP GP recommends for acquisition by the Partnership to the Executive Committee. The
Executive Committee shall have seven (7) Business Days after its receipt of the Acquisition
Memorandum to approve or disapprove of the acquisition of a Proposed Qualified Asset or
Non-Parameter Asset in accordance with Section 3.4 hereof.

               (b) Acquisition Memorandum. For each Proposed Qualified Asset and Non-Parameter
Asset, LMLP GP or Asset Manager shall deliver to the Executive
Committee an Acquisition Memorandum describing such Proposed Qualified Asset or Non-Parameter
Asset in reasonable detail, including without limitation:

          (i) whether it is a Proposed Qualified Asset or a Non-Parameter Asset;

27

 

          (ii) the size and location thereof;

          (iii) the improvements thereon;

          (iv) the operating history, if any, financial status and financial projections (for a minimum
of five (5) years, including any anticipated expenditures or allowances) thereof;

          (v) market data, including rental and sales comparables and competitive submarket survey, if
necessary;

          (vi) the material findings of all due diligence undertaken to date with respect thereto, if
any, including a summary of any litigation involving the Proposed Qualified Asset or Non-Parameter
Asset and the material findings to date of any Environmental Assessment and/or Physical Inspection
Report;

          (vii) photographs and site plans;

          (viii) the estimated cost to the Partnership, including the estimated purchase price and
estimated due diligence costs, the amount and material terms of any mortgage indebtedness to be
assumed, incurred or taken subject to;

          (ix) the material provisions of the net lease or leases thereon and copies of such leases (or
in the case of proposed leases, drafts or reasonably detailed abstracts of proposed leases);

          (x) the identification of each tenant and financial information relating to each such tenant;

          (xi) such other information and documentation any member of the Executive Committee may
reasonably request and is reasonably available, including the purchase and sale agreement and loan
documents.

               (c) Assets Which Do Not Comply With Acquisition Parameters. LMLP GP may submit
net-leased assets that do not comply in all respects with the Acquisition Parameters (each, a
“Non-Parameter Asset”) to the Executive Committee for approval pursuant to
Section 3.6(a) hereof.

               (d) Acquisition of Approved Qualified Assets. Upon receipt of the written approval of
a majority of the members of the Executive Committee as provided in Section 3.6(a) above of
the acquisition by the Partnership of a Proposed Qualified Asset or Non-Parameter Asset (any
Proposed Qualified Asset or Non-Parameter Asset so approved, an
“Approved Qualified Asset”), LMLP GP or Asset Manager shall take all commercially reasonable
efforts on behalf of the Partnership to negotiate and execute all documents necessary to acquire
the Approved Qualified Asset pursuant to and in accordance with the terms approved by the Partners
(including formation of an SP Subsidiary, if applicable) and to complete due diligence that the
General Partner deems reasonably necessary, including (to the extent not already completed)
obtaining an Environmental Assessment and a Physical Inspection Report.

28

 

LMLP GP or Asset Manager
shall keep the Executive Committee reasonably informed of the progress of the Partnership’s
acquisition of any Approved Qualified Asset, including the material findings of all due diligence
and of any material matters that arise during the course thereof. Upon completion of all due
diligence undertaken as specified above with respect to an Approved Qualified Asset and as a
condition to completing the acquisition of the Approved Qualified Asset, LMLP GP or Asset Manager
shall deliver to the Executive Committee a memorandum summarizing the material findings of the
completed due diligence and any changes in the status of such Approved Qualified Asset since the
date of the Acquisition Memorandum described in Section 3.6(b) above and the Executive
Committee, in accordance with Section 3.4 hereof, shall confirm its continuing approval of
the acquisition before LMLP GP commits (on a nonrefundable basis) the Partnership’s funds as
provided below. Upon request by any member of the Executive Committee, LMLP GP or Asset Manager
will provide to the Executive Committee copies of the Environmental Assessment, the Physical
Inspection Report and the survey after completion thereof.

                    It is understood and agreed that (x) LMLP GP may deposit its own funds, or cause the
Partnership to deposit Partnership funds, as refundable earnest money, and (y) the Partnership’s
funds shall be substituted (and such funds reimbursed to LMLP GP) or committed, as the case may be,
on a nonrefundable basis only after due diligence is completed and the Executive Committee has
confirmed its continuing approval of the acquisition. After the Partnership has committed its
funds on a nonrefundable basis in accordance with the prior sentence, if the terms of the
acquisition change in any material respect from the terms described in the Acquisition Memorandum,
such change shall require the consent of a majority of the members of the Executive Committee.

                    An acquisition of a Approved Qualified Asset shall be made through SP Subsidiaries utilizing
the SP Subsidiary Agreements.

                    Within five (5) Business Days after the closing of the acquisition of an Approved Qualified
Asset, LMLP GP shall deliver to the Partners a closing statement acknowledging the receipt of and
setting forth the application of the Partners’ Capital Contributions and any other funds of the
Partnership used to acquire such Approved Qualified Asset or to pay closing costs (including an
estimate of costs not finalized at closing, including legal fees and costs) associated therewith.

               (e) Disapproved Qualified Assets. If the Executive Committee (x) disapproves any
Proposed Qualified Asset or any proposed Non-Parameter Asset, (y) fails after the completion of due
diligence to confirm its continuing approval of the acquisition of an Approved Qualified Asset as
provided in Section 3.6(d) above, or (z) otherwise withdraws its approval of an Approved Qualified
Asset as provided in Section 3.6(d) above, LMLP GP shall not cause or permit the
Partnership to acquire such Proposed Qualified Asset, proposed Non-
Parameter Asset or Approved Qualified Asset and the LMLP Partners or their designee shall have
the right to acquire such Proposed Qualified Asset, proposed Non-Parameter Asset or Approved
Qualified Asset for their own account or with or in connection with any other Person;
provided that such right shall not apply if the members of the Executive Committee
appointed by Inland vote to approve the acquisition in accordance with Section 3.4 hereof.

29

 

               (f) Acquisition Costs. Except as provided in this Section 3.6(f) and in
Section 3.6(g) hereof, LMLP GP or the Asset Manager (as the case may be) shall be liable
for all costs and expenses (“Acquisition Costs”) arising in connection with the identification or
evaluation of, the bidding on and the structuring and negotiation of and contracting for the
acquisition or attempted acquisition of, and the due diligence undertaken in connection with, any
Proposed Qualified Asset or Approved Qualified Asset (such activities, the “Acquisition
Activities”); provided that:

          (i) the Partnership shall (x) reimburse LMLP GP or the Asset Manager (as the case may be) for
all Acquisition Costs and (y) be liable for all reasonable and customary costs and expenses of
Third Parties retained in connection with the Acquisition Activities related to Approved Qualified
Assets;

          (ii) the Partnership shall reimburse LMLP GP or the Asset Manager (as the case may be) for 60%
of the Acquisition Costs in connection with Acquisition Activities related to Proposed Qualified
Assets and Approved Qualified Assets that are disapproved by the Executive Committee;

               Notwithstanding the foregoing, but subject to Section 3.9 hereof, if for any reason
other than pursuant to Article XI hereof any LMLP Affiliated Party (instead of the
Partnership or an SP Subsidiary) acquires title to any Proposed Qualified Asset or Approved
Qualified Asset, LMLP shall pay all of the costs and expenses (and reimburse the Partnership for
any refundable or nonrefundable deposits funded by the Partnership in connection with the
acquisition of such asset) incurred or to be incurred in connection with the Acquisition Activities
relating to such Proposed Qualified Asset or Approved Qualified Asset.

               (g) Acquisition Fee. Upon the acquisition of any Approved Qualified Asset by the
Partnership or by an SP Subsidiary (including any Approved Qualified Asset contributed in whole or
in part by LMLP to the Partnership), pursuant to this Section 3.6, Inland shall pay LMLP GP
or the Asset Manager an acquisition fee (the “Acquisition Fee”) equal to the sum of the gross
purchase price of such acquired Approved Qualified Asset multiplied by 0.425%.

               For example, if the purchase price of such acquired Approved Qualified Asset were $25 million,
Inland’s Acquisition Fee would equal $106,250.

               Section 3.7 Sale of Qualified Assets.

               (a) Authority to Sell. Subject to Article XI, the General Partner shall have
no authority to and shall not initiate the sale of any Qualified Asset without approval by the
Executive Committee in accordance with Section 3.4 of this Agreement.

               (b) Assets in Foreclosure. In the event a lender to the Partnership or a SP
Subsidiary has initiated or threatens to initiate a foreclosure proceeding with respect to any
Qualified Asset securing such lender’s loan to the Partnership or such SP Subsidiary, and a Partner
disagrees as to whether such Qualified Asset shall be transferred to the lender in satisfaction of
such loan, the Partner not in favor of such transfer shall have the right to purchase such
Qualified Asset from the Partnership for One Dollar ($1.00) provided such Partner

30

 

assumes such loan
in full and such lender releases the Partnership and any guarantors therefrom. No adjustments to
the Capital Contributions, Capital Commitments, or Capital Account shall be made on account of a
transfer made in accordance with this Section 3.7(b).

               Section 3.8 Partnership Indebtedness.

               (a) Maximum Debt. The Partnership on a consolidated basis with the SP Subsidiaries
shall maintain a total debt (secured or unsecured) of not greater than seventy-five percent (75%)
of the gross acquisition cost of the Partnership’s Qualified Assets; provided, that the gross
acquisition cost of a Qualified Assumed Asset shall include the refinancing costs (including
defeasance costs and prepayment costs) related to the Qualified Assumed Asset. The total debt
secured by any Qualified Asset shall not exceed 75% of the gross acquisition cost of such Qualified
Asset; provided, that the gross acquisition cost of a Qualified Assumed Asset shall include the
refinancing costs (including defeasance costs and prepayment costs) related to the Qualified
Assumed Asset.

               (b) Non-Recourse to the Partners. Notwithstanding anything to the contrary contained
in this Agreement, the Partnership shall not incur debt that is recourse to the Partners, and the
Partners shall not be liable for any debts or other obligations or liabilities incurred by the
Partnership; provided, that, if a lender will not accept the Partnership as a guarantor for
“non-recourse carve-outs,” LMLP shall provide such “non-recourse carve-out” guarantee.

               (c) Cross-Default Provisions. Unless approved by a Supermajority Vote of the
Executive Committee, the Partnership shall not incur any indebtedness that contains cross-default
provisions, except for any financing the Partnership shall obtain pursuant to Sections 3.8
(e) and (f) hereof.

               (d) Loan Terms. The Partnership shall endeavor to procure indebtedness, the terms of
which will:

                    (i) not prohibit the replacement of the General Partner or the Asset Manager with a Person,
including an Affiliate of Inland, so long as such Person meets the standards of the commercial
mortgage backed securities market; and

                    (ii) not prohibit transfers pursuant to Articles VIII or XI hereof;

                    in each case without triggering the due on sale provision, a prepayment penalty or an
assumption fee (other than administrative fees and other nominal lender fees, including legal
costs).

               (e) Restriction on Indebtedness. Notwithstanding anything in this Agreement to the
contrary, but subject to Sections 3.8(a), (b), (c) and (d), so long
as any Preferred Equity is outstanding, the Partnership shall be prohibited from refinancing any
Qualified Assumed Asset with allocated Preferred Equity without the prior written consent of LMLP;
provided that the Partnership shall, without the approval of LMLP, be permitted to obtain a loan or
loans to refinance any such Qualified Assumed Assets if (i) the annual total debt

31

 

service payments
required to be paid on such loan or loans is equal to or less than the payments that the
Partnership is otherwise required to make on any Existing Indebtedness and any other indebtedness
related to such Qualified Assumed Assets and the Preferred Equity being redeemed with the proceeds
of such loan or loans, (ii) a portion of the proceeds of such loan or loans will be used to
sufficiently redeem the Preferred Equity Redemption Amount related to such Qualified Assumed Asset
in accordance with Section 7.1(c) hereof, (iii) such loan or loans are on commercially
reasonable terms and (iv) LMLP is provided with 10 Business Days advance notice of the terms of
each such loan or loans.

               (f) Qualified Assumed Asset Debt Placement. Notwithstanding anything in this
Agreement to the contrary, but subject to Sections 3.8(a), (b), (c) and
(d), LMLP GP or LMLP is hereby authorized to obtain a loan or loans on behalf of the
Partnership or an SP Subsidiary to refinance any or all of the Qualified Assumed Assets with
allocated Preferred Equity, without the approval of the Executive Committee or the consent of
Inland, so long as (i) the annual total debt service payments required to be paid on such loan or
loans is equal to or less than the payments that the Partnership is otherwise required to make on
any Existing Indebtedness and any other indebtedness related to such Qualified Assumed Assets and
the Preferred Equity being redeemed with the proceeds of such loan or loans, (ii) a portion of the
proceeds of such loan or loans will be used to redeem the Preferred Equity Redemption Amount
related to such Qualified Assumed Asset in accordance with Section 7.1(c) hereof, (iii)
such loan or loans are on commercially reasonable terms and (iv) Inland is provided with 10
Business Days advance notice of the terms of each such loan or loans.

               (g) Future Debt Placement. For any future debt financings, the Partnership shall give
each of Inland Mortgage Brokerage Corporation and Concord Debt Holdings LLC the opportunity to bid
to place or originate such debt financing, but the Partnership shall not be obligated to use either
Inland Mortgage Brokerage Corporation or Concord Debt Holdings LLC for any future debt financing.

               Section 3.9 Business Opportunity.

               (a) LMLP.

          (i) General. Each LMLP Affiliated Party may each engage in or possess any interest in
other business ventures of any kind, independently or with others, including but not limited to the
ownership, operation and management of net-leased real estate assets, except as provided in this
Section 3.9(a).

          (ii) Exclusivity. During the Acquisition Period and except as provided in Section
3.9(iii) hereof or with respect to obligations to the existing joint ventures set forth on
Schedule 3.9 hereto, (a) the LMLP Affiliated Parties shall not acquire, or earn any
incentive fee for the management or leasing of, any net-leased assets which satisfy or comply
with all of the “Acquisition Parameters,” and (b) LMLP GP shall make available for purchase by the
Partnership, and the Partnership shall have the right to purchase pursuant to Section 3.6
hereof, all net-leased assets offered to or discovered by the LMLP Affiliated Parties which satisfy
or comply with all of the “Required Parameters” comprising the Acquisition Parameters
(collectively, the “Exclusivity Right”).

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          (iii) Acquisition by LMLP Affiliated Parties. Notwithstanding anything to the contrary
contained in this Agreement, any LMLP Affiliated Party may acquire (A) the assets LMLP GP is
required to offer to the Partnership in accordance with this Section 3.9(a) only (1) if the
asset is owned by an LMLP Affiliated Party or related (through adjacent or common ownership or
constitutes land or other assets underlying or constituting part of an asset owned by an LMLP
Affiliated Party) to an asset owned by an LMLP Affiliated Party, (2) if the seller will accept only
O.P. Units in exchange therefor, (3) if any LMLP Affiliated Party is required to offer the asset
pursuant to an existing joint venture arrangement, or (4) after the Executive Committee (including
at least one (1) of the two (2) members appointed by Inland) has disapproved such acquisition as
provided in Section 3.4 hereof and (B) assets that it is not required to offer to the
Partnership under this Section 3.9(a).

          (iv) Termination of Exclusivity Right. Notwithstanding anything to the contrary
contained in this Agreement, the Exclusivity Right and the provisions of this Section
3.9(a) shall terminate on the earlier of (A) the expiration of the Acquisition Period and (B)
at such time as the Executive Committee (including at least one (1) of the two (2) members
appointed by Inland) disapproves, within any consecutive twelve (12) month period, the lesser of
(x) four (4) Proposed Qualified Assets or Approved Qualified Assets pursuant to this Agreement and
(x) the number (but in no event less than three (3)) of Proposed Qualified Assets and Approved
Qualified Assets requiring an equity investment by the Partnership of at least $100,000,000.00
assuming 70% debt to the proposed purchase price.

          (v) LMLP Existing Joint Ventures. From time to time, upon reasonable written request
from Inland, the LMLP Partners shall provide a schedule of the LMLP Affiliated Parties’ existing
joint ventures’ respective investment criteria and exclusivity terms. A current list the LMLP
Affiliated Parties’ existing joint ventures’ respective investment criteria and exclusivity terms
is set forth on Schedule 3.9 hereto.

          (vi) LMLP Restrictions.

               (A) The LMLP Partners shall cause the LMLP Affiliated Parties not to directly or indirectly
solicit or otherwise attempt to persuade any tenant of any Qualified Asset to vacate the Qualified
Asset to purchase, or relocate to, another asset that is not a Qualified Asset.

               (B) LMLP and its Affiliates shall not discriminate against any Qualified Asset when making a
proposal to any existing or prospective tenant in connection with the leasing of available space.

               (C) In the event that an LMLP Affiliated Party leases space to a then tenant of a Qualified
Asset, LMLP GP, so long as it is the General Partner, shall provide written notice to Inland of
such leasing activity.

               (b) Inland. Inland and any of its Affiliates and related parties may engage in or
possess any interest in other business ventures of any kind, independently or with others,
including but not limited to the ownership, operation and management of net-leased real estate
asset.

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               (c) Duties and Conflicts. Subject to LMLP GP’s obligation to present net-leased real
estate assets to the Partnership pursuant to Section 3.6 and Section 3.9(a) hereof,
each Partner recognizes that the other Partners and their Affiliates have or may have other
business interests, activities and investments, some of which may be in conflict or competition
with the business of the Partnership, and that such Persons are entitled to carry on such other
business interests, activities and investments. The Partners and their Affiliates may engage in or
possess an interest in any other business or venture of any kind, independently or with others, on
their own behalf or on behalf of other entities with which they are affiliated or associated, and
such Persons may engage in any activities, whether or not competitive with the Partnership, without
any obligation (except as expressed in Sections 3.6 and 3.9(a)) to offer any
interest in such activities to the Partnership or to any Partner. Except as provided in
Sections 3.6 or 3.9(a), neither the Partnership nor any Partner shall have any
right, by virtue of this Agreement, in such activities, or the income or profits derived therefrom,
and the pursuit of such activities, even if competitive with the business of the Partnership, shall
not be deemed wrongful or improper.

               Section 3.10 Payments to the Asset Manager of the General Partner.

               (a) Property Management Fee. The General Partner shall cause the Partnership to pay
to the Asset Manager (or its designee) pursuant to the Management Agreement an annual Property
Management Fee (“Property Management Fee”) equal to the sum of (x) three percent (3%) of actual
gross revenues for the fiscal year (or applicable portion thereof) derived from Qualified Assets
encumbered by leases that provide for full recovery of the Property Management Fee from the tenant
(“Gross Revenues”), plus (y) on Qualified Assets where the leases do not provide for full recovery
of the Property Management Fee from the tenant, the amount recoverable for the fiscal year (or
applicable portion thereof) from the tenants of such Qualified Assets for property management
expenses under such leases (“Recoverable Amounts”), payable monthly.

               (b) Partnership Management Fee. The General Partner shall cause the Partnership to
pay to the Asset Manager pursuant to the Management Agreement an annual Partnership Management Fee
(“Partnership Management Fee”) equal to (x) so long as LMLP GP is the General Partner, Inland’s
Percentage Interest multiplied by three hundred seventy five thousandths of a percent (0.375%) of
the Equity Capital for a fiscal year (pro rated for partial years), or (y) so long as LMLP GP is no
longer the General Partner, three hundred seventy five thousandths of a percent (0.375%) of the
Equity Capital for a fiscal year (pro rated for partial years), in either case payable monthly and
adjusted as provided herein. Within thirty
(30) days of the Partnership’s receipt of the annual reports described in Section 4.3
hereof for a fiscal year, the Asset Manager shall provide to the Partners a written statement of
reconciliation (which the Partners shall have the right to contest) setting forth (x) the Equity
Capital for such fiscal year (or partial year) and the Partnership Management Fee payable to the
Asset Manager in connection therewith, pursuant to this Agreement, (y) the Partnership Management
Fee already paid by the Partnership to the Asset Manager during such fiscal year (or partial year),
and (z) either the amount owed to the Asset Manager by the Partnership (which shall be the excess,
if any, of the Partnership Management Fee payable to the Asset Manager for such fiscal year (or
partial year) pursuant to this Agreement over the Partnership Management Fee actually paid by

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the
Partnership to the Asset Manager for such fiscal year (or partial year)) or the amount owed to the
Partnership by the Asset Manager (which shall be the excess, if any, of the Partnership Management
Fee actually paid by the Partnership to the Asset Manager for such fiscal year (or partial year)
over the Partnership Management Fee payable to the Asset Manager for such fiscal year pursuant to
this Agreement). The Asset Manager or the Partnership, as the case may be, shall pay to the other
the amount owed pursuant to clause (z) above within five (5) Business Days of the receipt by the
Partners of the written statement of reconciliation described in this Section 3.10(b).

               In addition, a credit in an amount equal to three hundred seventy five thousandths of a
percent (0.375%) of the Equity Capital for a fiscal year (pro rated for partial years), less the
Partnership Management Fee, as adjusted above (or the applicable portion thereof), shall accrue and
be reserved on the Partnership books until a Capital Call is made by the General Partner in
accordance with Section 5.1(b) hereof, whereupon the amount of the credit shall be applied,
in whole or in part, to the extent necessary to fund LMLP’s pro rata shares of such Capital Call
and will be treated for purposes of this Agreement as if each pro rata share of such amount were an
actual Capital Contribution made by the respective LMLP Partner which (1) reduces the respective
aggregate Capital Commitment of each LMLP Partner and (2) gives rise to an entitlement to
allocations (but only out of subsequent Profits), and related distributions, in amounts that
reflect the amounts that would have been allocated and distributed if such notional capital
contributions had constituted actual Capital Contributions, including a return of such notional
capital contributions to LMLP pursuant to Section 7.1 hereof.

               (c) Acquisition Fees. Inland shall pay the Acquisition Fees in accordance with the
provisions of Section 3.6(g).

               Section 3.11 Exculpation.

               (a) LMLP. No LMLP Affiliated Party nor or any officer, director, trustee,
shareholder, member, manager, partner, employee, Affiliate or agent of any LMLP Affiliated Party
shall be liable, responsible or accountable in damages or otherwise to the Partnership or any other
Partner for any act or omission on behalf of the Partnership, in good faith and within the scope of
the authority conferred on LMLP GP as General Partner under this Agreement or otherwise under this
Agreement or the Asset Manager, as the case may be, or by law unless such act or failure to act
(i) is or results in a breach of any representation, warranty or covenant of any LMLP Partner
contained in this Agreement or any other agreement entered into in connection therewith or related
thereto, (ii) was fraudulent or committed in bad faith or (iii) constituted gross negligence,
willful misconduct or a breach of fiduciary duty.

               (b) Inland. None of Inland, or any officer, director, trustee, shareholder, member,
manager, partner, employee, Affiliate or agent of Inland, or any Affiliate of Inland shall be
liable, responsible or accountable in damages or otherwise to the Partnership or to any other
Partner for any act or omission on behalf of the Partnership, in good faith and within the scope of
authority conferred on Inland under this Agreement or by law unless such act or failure to act
(i) is or results in a breach of any representation, warranty or covenant of Inland contained in
this Agreement or any other agreement entered into in connection therewith or

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related thereto,
(ii) was fraudulent or committed in bad faith or (iii) constituted gross negligence, willful
misconduct or a breach of fiduciary duty.

               (c) Survival. The provisions of this Section 3.12 shall survive any
termination of the Partnership or this Agreement.

               Section 3.12 Indemnification.

               (a) By the Partnership. The Partnership shall indemnify, defend and hold harmless any
Person (an “Indemnified Party”) who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative, by reason of any act or omission or alleged act or omission
arising out of such Indemnified Party’s activities as (i) a Partner or an officer, director,
trustee, shareholder, member, manager, partner, employee, Affiliate or agent of the Partner,
(ii) the General Partner or the Asset Manager or an officer, director, trustee, shareholder,
member, manager, partner, employee, Affiliate or agent of any of them on behalf of the Partnership
or in furtherance of the interest of the Partnership, or (iii) LMLP or any LMLP Affiliated Party,
but only if LMLP GP is no longer the General Partner, that is obligated to enter into a direct
financial obligation (including, without limitation, a “non-recourse carve-out” guarantee) in
connection with the financing of any Qualified Asset, in each case against personal liability,
claims, losses, damages and expenses for which such Indemnified Party has not been reimbursed by
insurance proceeds or otherwise (including reasonable attorneys’ fees, judgments, fines and amounts
paid in settlement) actually and reasonably incurred by such Indemnified Party in connection with
such action, suit or proceeding and any appeal therefrom, unless such Indemnified Party (A) acted
fraudulently, in bad faith or with gross negligence or willful misconduct or (B) by such act or
failure to act breached any representation, warranty or covenant contained in this Agreement, which
breach had or has a material adverse effect on the Partnership or any Partner and, if capable of
cure, is not cured within fifteen (15) days after notice thereof by the aggrieved Partner(s). Any
indemnity by the Partnership under this Agreement shall be provided out of, and to the extent of,
Partnership revenues and assets only, and no Partner shall have any personal liability on account
thereof. The indemnification provided under this Section 3.12 shall (x) be in addition to,
and shall not limit or diminish, the coverage of the Partners or any Affiliates under any insurance
maintained by the Partnership and (y) apply to any legal action, suit or proceeding commenced by a
Partner or in the right of a Partner or the Partnership. The indemnification provided under this
Section 3.12 shall be a contract right and shall include the right to be reimbursed for
reasonable expenses incurred by any such Indemnified Party within thirty (30) days after such
expenses are incurred.

               (b) By the LMLP Partners. The LMLP Partners, so long as LMLP GP is the General
Partner, shall indemnify and hold harmless Inland and any Affiliate and
related party or agent thereof from and against any liabilities, claims, losses, damages and
expenses incurred by any such person (including reasonable attorneys’ fees, judgments, fines and
amounts paid in settlement) as a result of any act or omission by any LMLP Affiliated Party which
(i) constitutes or results in a breach of any representation, warranty or covenant of any LMLP
Partner contained in this Agreement or any other agreement entered into in connection herewith or
related hereto, (ii) was performed or omitted fraudulently or in bad faith or (iii) constituted
gross negligence, willful misconduct or breach of fiduciary duty.

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               (c) By Inland. Inland, so long as LMLP GP is no longer the General Partner, shall
indemnify and hold harmless the LMLP Affiliated Parties or agent thereof from and against any
liabilities, claims, losses, damages and expenses incurred by any such person (including reasonable
attorneys’ fees, judgments, fines and amounts paid in settlement) as a result of any act or
omission by Inland or any successor General Partner which (i) constitutes or results in a breach of
any representation, warranty or covenant of Inland or any successor General Partner contained in
this Agreement or any other agreement entered into in connection herewith or related hereto,
(ii) was performed or omitted fraudulently or in bad faith or (iii) constituted gross negligence,
willful misconduct or breach of fiduciary duty.

ARTICLE IV

BOOKS AND RECORDS; REPORTS TO PARTNERS

               Section 4.1 Books. The General Partner shall maintain or cause to be maintained
separate, full and accurate books and records of the Partnership, and any Partner or any authorized
representative of any Partner, shall have the right to inspect, examine and copy the same and to
meet with employees of the General Partner responsible for preparing the same at reasonable times
during business hours and upon reasonable notice. All policies of the Partnership with respect to
the maintenance of such books and records shall be subject to approval by all of the Partners.

               Section 4.2 Monthly and Quarterly Reports.

               (a) Monthly Reports. The General Partner shall prepare and distribute to Inland
within twenty (20) days after the last day of each month a report with respect to the Partnership,
which shall include (i) unaudited financial statements, consisting of at least an operating
statement for the monthly period and year-to-date showing variances from the Annual Budget portion
of the Annual Plan and (ii) a schedule of aged accounts receivable and accounts payable. Variances
from any line item in the Annual Budget exceeding the greater of One Hundred Thousand Dollars
($100,000) and ten percent (10%) of the amount allocated to such budget line item through the end
of such month shall be explained in writing, unless already approved by the Executive Committee
pursuant to Section 3.4 hereof.

               (b) Quarterly Reports. The General Partner shall, no later than the thirtieth (30th)
day after the end of each fiscal quarter, prepare and distribute:

          (i) a year-to-date consolidated report with respect to the Partnership (with the last month of
each such report comprised of forecasted, rather than actual, results), prepared in accordance with
generally accepted accounting principles, consistently
applied, including (a) a balance sheet, (b) a profit and loss statement, (c) a statement of
changes in the Partners’ Capital Accounts, (d) a report briefly describing each variance from the
applicable budget line item in the consolidated Annual Budget portion of the Annual Plan exceeding
the greater of One Hundred Thousand Dollars ($100,000) and ten percent (10%) of the amount
allocated to such budget line item through the date of such report, and (e) calculations in
sufficient detail to verify the accuracy of all fees and other amounts paid or payable to the
Asset Manager under the Management Agreement;

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          (ii) a report with respect to each Qualified Asset, including an operating statement for the
quarter and year-to-date showing each variance from the budget line items in the Annual Budget
portion of the Annual Plan, and a narrative describing material changes in property operations,
physical condition, capital expenditures and leasing and occupancy; and

          (iii) so long as LMLP GP is the General Partner, such other reports, statements and
information regarding the Partnership and Qualified Assets as Inland may reasonably request from
time to time.

               Section 4.3 Annual Reports. The General Partner shall prepare and distribute to
Inland within (x) forty-five (45) days after the end of each fiscal year draft unaudited financial
statements with respect to the Partnership, and (y) within seventy-five (75) days after the end of
each fiscal year audited financial statements with respect to the Partnership. Such financial
statements shall be prepared in accordance with generally accepted accounting principles,
consistently applied, and shall be audited at the Partnership’s expense by such nationally
recognized firm of independent certified public accountants approved by the Executive Committee as
provided in Section 3.4 hereof. All reports delivered pursuant to this Section 4.3
shall also include unaudited calculations in sufficient detail to verify the accuracy of all
distributions paid by the Partnership.

               Section 4.4 Accountants; Tax Returns. The General Partner shall also engage such
nationally recognized firm of independent certified public accountants approved by the Executive
Committee as provided in Section 3.4 hereof to review, or to sign as preparer, all federal,
state and local tax returns which the Partnership is required to file. The General Partner will
furnish to each Partner within one hundred twenty (120) days after the end of each calendar year,
or as soon thereafter as is practicable, a Schedule K-1 or such other statement as is required by
the Internal Revenue Service which sets forth such Partner’s share of the profits or losses and
other relevant fiscal items of the Partnership for such fiscal year. If requested by a Partner,
the General Partner shall deliver to such Partner copies of any federal, state and local income tax
returns and information returns which the Partnership is required to file.

               Section 4.5 Accounting and Fiscal Year. The General Partner shall keep the
Partnership books and records on the accrual basis. The fiscal year of the Partnership shall end
on December 31.

               Section 4.6 Partnership Funds.

               (a) Generally. The funds of the Partnership shall be deposited into such account or
accounts as are designated by the General Partner. All withdrawals from or charges against such
accounts shall be made by the General Partner or by those Persons designated from time to time by
the General Partner.

               (b) Restrictions on Deposits. Pending distribution or expenditure in accordance with
the terms of this Agreement, funds of the Partnership may be invested, in the reasonable discretion
of the General Partner, in United States government

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obligations, insured obligations which are rated not lower than AA by Standard & Poor’s or
have a comparable rating from a nationally recognized rating agency, collateralized bank time
deposits, repurchase agreements, money market funds, commercial paper which is rated not lower than
P-1, certificates of deposit which are rated not lower than AA by Standard & Poor’s or have a
comparable rating from a nationally recognized rating agency, banker’s acceptances eligible for
purchase by the Federal Reserve and bonds and other evidences of indebtedness and preferred stock
which are rated not lower than AA by Standard & Poor’s or are of a comparable credit quality.

               Section 4.7 Insurance. The General Partner shall cause the tenant or tenants of each
Qualified Asset to maintain insurance thereon of such types and in such amounts that are in
accordance with the applicable lease. Unless otherwise determined by Supermajority Vote of the
Executive Committee, the General Partner shall cause the Partnership to obtain, at the
Partnership’s expense, such types and amounts of insurance that the tenant or tenants of any
Qualified Asset are not required to maintain and that are included within the insurance standards
listed on Schedule 4.7 hereto, as may be revised from time to time by a Supermajority Vote
of the Executive Committee.

ARTICLE V

CONTRIBUTIONS

               Section 5.1 Capital Contributions.

               (a) Generally; Percentage Interests.

                    (i) LMLP has made an Initial Capital Contribution to the Partnership by contributing to the
Partnership cash in an amount set forth on Schedule 1 hereto and Contributed Assets
pursuant to the Contribution Agreement having a value set forth on Schedule 1 to the Contribution
Agreement. Inland has made an Initial Capital Contribution to the Partnership by contributing to
the Partnership cash in the amount set forth on Schedule 1 hereto (which reflects a
$250,000 credit as satisfaction of its underwriting fees in connection with the formation of the
Partnership).

                    (ii) The aggregate of Inland’s Initial Capital Contribution and Remaining Qualified Assumed
Asset Capital Contribution shall not exceed $214,259,817, less the designated amounts with respect
to each Cap/Ex Lease Assumed Asset (which shall not exceed $3,000,000) (the “Cap Ex/Lease Assumed
Asset Amount”), but only to the extent one or more of the Cap Ex/Lease Assumed Assets are acquired
        .

                    (iii) Except as provided in this Section 5.1, (i) no Partner shall be obligated to
make any Additional Capital Contribution or Extraordinary Funding to the Partnership and (ii) any
Additional Capital Contribution or Extraordinary Funding shall be made by the Partners in
proportion to their respective Percentage Interests as determined at the time of the Capital Call
or Extraordinary Call.

                    (iv) The Partners shall have the Percentage Interests in the Partnership set forth opposite
each Partner’s name on Schedule 1 hereto.

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                    (v) The aggregate Purchase Price for all of the Qualified Assumed Assets shall be
$747,474,914, subject to adjustment in accordance with the Contribution Agreement, the Purchase
Agreement and the Letter Agreement. Subject to the Contribution Agreement, the Purchase Agreement
and the Letter Agreement, the Qualified Assumed Assets shall be acquired by the Partnership, from
time to time, on or prior to March 31, 2008; provided, that the Delayed Qualified Assumed Assets
shall be acquired by the Partnership, from time to time, on or prior to June 30, 2008.
Simultaneously with the acquisition of a Qualified Assumed Asset, (i) Inland shall make an
attendant Remaining Qualified Assumed Assets Capital Contribution in cash in an amount equal to the
product of 0.85 multiplied by the difference between (x) the Purchase Price (as adjusted pursuant
to the Contribution Agreement or the Purchase Agreement and the Letter Agreement) of such Qualified
Assumed Asset and (y) the principal balance of any mortgage financing secured by such Qualified
Assumed Asset and the amount of Preferred Equity determined in accordance with the Letter
Agreement; and (i) LMLP shall make an attendant Remaining Qualified Assumed Assets Capital
Contribution in cash or in Contributed Assets in an amount or having a value equal to the product
of 0.15 multiplied by the difference between the Purchase Price (as adjusted pursuant to the
Contribution Agreement or the Purchase Agreement and the Letter Agreement) of such Qualified
Assumed Asset less the principal balance of any mortgage financing secured by such Qualified
Assumed Asset and the amount of Preferred Equity determined in accordance with the Letter
Agreement.

                    (vi) In the event that by June 30, 2008 not all of the Qualified Assumed Assets have been
acquired by the Partnership and LMLP has made a Capital Contribution in excess of 15% of the
aggregate Capital Contributions of the Partners, then the General Partner shall cause the amount of
LMLP’s Capital Contribution that is in excess of 15% of the aggregate Capital Contributions of the
Partners to accrue and be reserved on the Partnership’s books as a credit toward satisfying LMLP’s
share of any future Capital Call and such credit shall be treated as if it were an actual Capital
Contribution for purposes of determining corresponding allocations and distributions.

               (b) Additional Capital Contributions. In the event the Partnership requires capital
to acquire an Approved Qualified Asset during the Acquisition Period, the General Partner shall be
entitled to require, by written notice to the Partners, an additional Capital Contribution (an
“Additional Capital Contribution”) from the Partners in an amount not in excess of the amount
necessary to acquire such Approved Qualified Asset plus all reasonable and customary costs and
expenses incurred by the Partnership in connection therewith; provided that (x) each
Partner shall be required to contribute the amount determined by multiplying such Partner’s
Percentage Interest by the amount of such Additional Capital Contribution and (y) no Partner shall
be required to contribute the amount described in clause (x) above if such amount, when added to
the total of all of such Partner’s prior Capital Contributions, exceeds such Partner’s Capital
Commitment. If the General Partner shall provide to the Partners a written notice calling for an
Additional Capital Contribution (any such notice, a “Capital Call”) setting forth the total amount
of such Additional Capital Contribution, the amount of each Partner’s share of such Additional
Capital Contribution as determined pursuant to clause (x) above and the due date on which the
General Partner is requiring that such Additional Capital Contribution be contributed to the
Partnership, which due date shall be at least ten (10) Business Days after the date on which the
Partners actually received the Capital Call and not more than one (1) Business Day prior to the
scheduled closing of the acquisition of

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such Approved Qualified Asset; each Partner shall contribute its share of such Additional
Capital Contribution in immediately available funds on or before such due date. If the acquisition
of an Approved Qualified Asset fails to close and the General Partner determines there will not be
a closing within fifteen (15) days of the date of the originally scheduled closing, the General
Partner (x) shall inform the Partners of such failure and return each Partner’s share of the
Additional Capital Contribution made with respect thereto and (y) each Partner’s Capital
Contribution shall be restored to the level thereof immediately prior to such Additional Capital
Contribution. If, at any time after the Partners have each contributed their entire Capital
Commitment, the Partners elect to contribute additional capital, the Partners shall contribute such
additional capital in accordance with their respective Percentage Interests.

               (c) Extraordinary Fundings. In the event the Partnership requires additional funds to
cover any costs and expenses for which the Partnership has insufficient funds, including tenant
improvements and capital expenditures, the General Partner may make a written request therefor (any
such request, an “Extraordinary Call”) setting forth the amount requested and the due date
therefor, which due date shall be at least ten (10) Business Days after the date on which the
Partners actually received the Extraordinary Call; provided that (i) any amount requested
shall not exceed 5% of the Purchase Price of the Qualified Asset if such funds are to be used for a
specific Qualified Asset or (ii) the aggregate of all amounts requested shall not exceed
$20,000,000 if such funds are to be used for the Partnership generally (such amount, the
“Extraordinary Call Cap”); provided further that no Partner shall be required to contribute
any capital to the Partnership in excess of such Partner’s Capital Commitment. Each Partner shall
be required to fund an amount equal to the amount determined by multiplying such Partner’s
Percentage Interest by the amount set forth in such approved Extraordinary Call (each such
Extraordinary Call required to be funded hereunder, an “Extraordinary Funding”). Each
Extraordinary Funding shall be made as a supplementary capital contribution by the Partners to the
Partnership (any such contribution, an “Extraordinary Capital Contribution”). Each Partner shall
contribute its share of such Extraordinary Capital Contribution in immediately available funds on
or before the due date in the Extraordinary Call.

               (d) Failure to Fund an Additional Capital Contribution or Extraordinary Funding. If
any Partner (a “Defaulting Partner”) fails to make any Additional Capital Contribution or
Extraordinary Funding which it is required to make under this Section 5.1 by the due date
therefor, then any non-defaulting Partner shall not be permitted to make such Additional Capital
Contribution or Extraordinary Funding, but may, at its election, make a loan to the Partnership (a
“Priority Loan”) in an amount equal to the amount that Additional Capital Contribution or
Extraordinary Funding required. Upon election to make a Priority Loan, (i) the non-defaulting
Partner shall loan to the Partnership the amount of the Defaulting Partner’s share of the
Additional Capital Contribution or Extraordinary Funding, as the case may be, as determined in
accordance with Section 5.1(b) or Section 5.1(c), as the case may be, (ii) such Priority Loan shall
bear interest at a rate of 18% per annum cumulative compounded from the date such Priority Loan is
made, (iii) the Annual Budget portion of the Annual Plan shall be amended to reflect such Priority
Loan, and (iv) such Priority Loan (including interest accrued thereon) shall be repaid from Net
Cash Flow from Operations or Net Cash from Sales or Refinancing prior to any distribution.

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               Section 5.2 Preferred Equity Capital Contribution. Upon the acquisition of a
Qualified Assumed Asset and subject to Section 3.8(a), LMLP shall make a Preferred Equity
Capital Contribution in an amount determined in accordance with this Agreement and the Letter
Agreement; provided that the aggregate Preferred Equity Capital Contribution shall not exceed
$163,500,000. The Preferred Equity shall be redeemed by the Partnership (i) in accordance with
Section 7.1(c) and Section 11.3(g) hereof and (ii) at the election of either the
Partnership or LMLP, if any Preferred Equity remains outstanding on the tenth anniversary of the
date first set forth above, on the tenth anniversary of the date first set forth above in full
together with all accrued and unpaid Preferred Equity Return. The General Partner shall update
Schedule 1 hereto to reflect the Preferred Equity Capital Contribution and any redemption
of Preferred Equity pursuant to this Section 5.2 or Section 7.1 hereof.

               Section 5.3 Return of Capital Contribution. Except as otherwise expressly provided in
this Agreement, (a) the Capital Contribution of a Partner will be returned to that Partner only in
the manner and to the extent provided in Article VII and Article IX hereof and
(b) no Partner shall have any right to demand or receive the return of its Capital Contribution.
In the event the Partnership is required or compelled to return any Capital Contribution, no
Partner shall have the right to receive assets other than cash. No Partner shall be entitled to
interest on its Capital Contribution or Capital Account notwithstanding any disproportion therein
as between the Partners.

               Section 5.4 Liability of the Limited Partners. No Limited Partner shall have any
personal liability to the Partnership, to any Partner, to the creditors of the Partnership or to
any other Person for any debt, liability or obligation of the Partnership. No Limited Partner
shall be required to contribute funds or capital to the Partnership in excess of its Capital
Commitment although Limited Partners may at their option contribute funds in excess of their
respective Capital Commitments pursuant to Section 5.1(c) and Section 5.1(d)
hereof.

               Section 5.5 No Third Party Beneficiaries. The foregoing provisions of this
Article V are not intended to be for the benefit of any creditor of the Partnership or any
other Person, and no creditor of the Partnership or any other Person may rely on the commitment of
any Partner to make any Capital Contribution. Additional Capital Contributions and Extraordinary
Fundings are not payable unless and until the conditions set forth in Section 5.1 hereof
have been satisfied, and no creditor of the Partnership or any other Person shall have, or be
given, any right to cause a Capital Call or Extraordinary Call to be given by the General Partner.

ARTICLE VI

MAINTENANCE OF CAPITAL ACCOUNTS;

ALLOCATION OF PROFITS AND LOSSES

FOR BOOK AND TAX PURPOSES

               Section 6.1 Capital Accounts.

               (a) Generally: Credits to Capital Accounts. A Capital Account shall be established
and maintained for each Partner. Initially, the Capital Account of each Partner shall be credited
with each Partner’s respective Initial Capital Contribution.

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Thereafter, each Partner’s Capital Account shall be credited with any Remaining Qualified
Assumed Assets Capital Contributions, Preferred Equity Capital Contributions, Additional Capital
Contributions or Extraordinary Capital Contributions made or contributed by such Partner and such
Partner’s allocable share of Profits, any individual items of income and gain allocated to such
Partner pursuant to the provisions of this Article VI, and the amount of additional cash,
or the Fair Market Value of any Partnership asset (net of any liabilities assumed by the
Partnership and liabilities to which the asset is subject), contributed to the Partnership by such
Partner or deemed contributed to the Partnership by such Partner in accordance with Regulations
Section 1.704-1(b)(2)(iv)(c).

               (b) Debits to Capital Account. The Capital Account of each Partner shall be debited
with the Partner’s allocable share of Losses, any individual items of expenses and loss allocated
to such Partner pursuant to the provisions of this Article VI, the amount of any cash
distributed to such Partner and the Fair Market Value of any Partnership asset (net of any
liabilities assumed by the Partner and liabilities to which the asset is subject) distributed to
such Partner or deemed distributed to such Partner in accordance with Regulations
Section 1.704-1(b)(2)(iv)(c).

               (c) Capital Account of Transferee. In the event that any Percentage Interest of a
Partner is transferred in accordance with the terms of this Agreement, the transferee shall succeed
to the Capital Account of the transferor to the extent it relates to the transferred Percentage
Interest in such Partner.

               (d) Adjustments of Book Value. In the event that the Book Value of any Partnership
asset is adjusted as described in the definition of “Book Value”, the Capital Accounts of all
Partners shall be adjusted in accordance with Regulation Section 1.704-1(b)(2)(iv)(f) or Regulation
Section 1.704-1(b)(2)(iv)(m), as applicable, to reflect such adjustment.

               (e) Compliance with Regulations. The foregoing provisions and the other provisions of
this Agreement relating to the maintenance of Capital Accounts are intended to comply with
Regulation Section 1.704-1(b) and shall be interpreted and applied in a manner consistent with such
Regulation. In the event that the General Partner shall determine that it is prudent to modify the
manner in which the Capital Accounts, or any debits or credits thereto, are computed in order to
comply with such Regulation, the General Partner may make such modification; provided, however,
that if such modification constitutes a Material Modification, it shall become effective only upon
the consent of any Partner to whom such modification would constitute a Material Modification.

               Section 6.2 Profits and Losses.

               (a) Allocation. For each Partnership taxable year or portion thereof, Profit and Loss
shall be allocated (after all allocations pursuant to Section 6.3 hereof have been made) in
such a manner so as to cause the Partially Adjusted Capital Accounts of the Partners to equal, as
nearly as possible, their respective Target Accounts.

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               (b) Adjustments to “Profits” and “Losses”. When used in this Agreement, “Profits” and
“Losses” shall mean, for each fiscal year or other period, an amount equal to the Partnership’s
taxable income or loss for such year or period, determined in accordance with Code Section 703(a)
(for this purpose, all items of income, gain, loss or deduction required to be stated separately
pursuant to Code Section 703(a)(1) shall be included in taxable income or loss), and otherwise in
accordance with the methods of accounting followed by the Partnership for federal income tax
purposes, with the following adjustments:

          (i) any income of the Partnership that is exempt from federal income tax and not otherwise
taken into account in computing Profits or Losses shall be added to such taxable income or loss;

          (ii) any items that are specially allocated pursuant to this Agreement shall not be taken into
account in computing Profits or Losses;

          (iii) any expenditure of the Partnership described in Section 705(a)(2)(B) of the Code (or
treated as such under Regulation Section 1.704-1(b)(2)(iv)(i)) and not otherwise taken into account
in computing Profits or Losses pursuant to this Definition shall be deducted from such taxable
income or loss;

          (iv) any depreciation, amortization and/or cost recovery deductions with respect to any asset
shall be deemed to be equal to the Book Depreciation available with respect to such asset;

          (v) the computation of all items of income, gain, loss and deduction shall be made without
regard to any basis adjustment under Section 743 of the Code;

          (vi) in the event the Book Value of any Partnership asset is adjusted pursuant to the
definition of Book Value, the amount of such adjustment shall be taken into account as gain or loss
from the disposition of such asset for purposes of computing Profits or Losses; and

          (vii) gain or loss resulting from any disposition of assets with respect to which gain or loss
is recognized for federal income tax purposes shall be computed by reference to the Book Value of
the asset disposed of, notwithstanding that the adjusted tax basis of such asset differs from its
Book Value.

               Section 6.3 Regulatory Allocations.

               (a) Minimum Gain Chargeback. If there is a net decrease in Partnership Minimum Gain
during any fiscal year, each Partner shall be specially allocated items of Partnership income and
gain for such fiscal year (and, if necessary, subsequent fiscal years) in an amount equal to such
Partner’s share of the net decrease in Partnership Minimum Gain, as determined under Regulations
Section 1.704-2(g). Allocations pursuant to the previous sentence shall be made in proportion to
the respective amounts required to be allocated to each Partner pursuant thereto. The items to be
so allocated shall be determined in accordance with Regulations Sections 1.704-2(f)(6) and
1.704-2(j)(2). This Section 6.3(a) is intended to comply

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with the “minimum gain chargeback” requirements of Regulations Section 1.704-2(f) and shall be
interpreted consistently therewith.

               (b) Chargeback Attributable to Partner Nonrecourse Debt. If there is a net decrease
in Partner Nonrecourse Debt Minimum Gain during any fiscal year attributable to a Partner
Nonrecourse Debt, each Partner with a share of Partner Nonrecourse Debt Minimum Gain attributable
to such Partner Nonrecourse Debt at the beginning of such year shall be specially allocated items
of income and gain for such fiscal year (and, if necessary, for subsequent fiscal years) in an
amount equal to such Partner’s share of the net decrease in Partner Nonrecourse Debt Minimum Gain
attributable to such Partner Nonrecourse Debt, determined in accordance with Regulations
Section 1.704-2(i)(4) and (5). Allocations pursuant to the previous sentence shall be made in
proportion to the respective amounts required to be allocated to each Partner pursuant thereto.
The items to be so allocated shall be determined in accordance with Regulations Sections
1.704-2(i)(4) and 1.704-2(j)(2). This Section 6.3(b) is intended to comply with the
“minimum gain chargeback” requirements of Regulations Section 1.704-2(i)(4) and shall be
interpreted consistently therewith.

               (c) Qualified Income Offset. If any Partner unexpectedly receives any adjustment,
allocation or distribution described in Regulations Section 1.704-1(b)(2)(ii)(d)(4), (5) or (6)
which results in or increases an Adjusted Capital Account Deficit for the Partner, such Partner
shall be allocated items of income and book gain in an amount and manner sufficient to eliminate
such Adjusted Capital Account Deficit or increase therein as quickly as possible; provided, that an
allocation pursuant to this Section 6.3(c) shall be made if and only to the extent that
such Partner would have an Adjusted Capital Account Deficit after all other allocations provided in
this Article VI have been tentatively made as if this Section 6.3(c) were not in
the Agreement. This Section 6.3(c) is intended to constitute a “qualified income offset”
as provided by Regulations Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently
therewith.

               (d) Partner Nonrecourse Deductions. Items of Partnership loss, deduction or
Section 705(a)(2)(B) expenditures that are attributable to a Partner Nonrecourse Debt (“Partner
Nonrecourse Deductions”) shall be allocated among the Partners who bear the Economic Risk of Loss
for such Partner Nonrecourse Debt in the ratio in which they share Economic Risk of Loss for such
Partner Nonrecourse Debt. This provision is to be interpreted in a manner consistent with the
requirements of Regulations Section 1.704-2(b)(4) and (i)(1).

               (e) Limitation on Allocation of Net Loss. To the extent any allocation of Losses or
other items of loss or deduction would cause or increase an Adjusted Capital Account Deficit as to
any Partner, such allocation shall be reallocated among the other Partners in accordance with their
respective Percentage Interests, subject to the limitations hereof.

               (f) Curative Allocation. The allocations set forth in this Section 6.3 (the
“Regulatory Allocations”) are intended to comply with certain requirements of the applicable
Regulations promulgated under Code Section 704(b). Notwithstanding any other provision of this
Article VI, the Regulatory Allocations shall be taken into account in allocating other
operating Profits, Losses and other items of income, gain, loss and deduction to the

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Partners for Capital Account purposes so that, to the extent possible, the net amount of such
allocations of Profits, Losses and other items shall be equal to the amount that would have been
allocated to each Partner if the Regulatory Allocations had not occurred.

               Section 6.4 Allocation of Tax Items for Tax Purposes.

               (a) Generally. Subject to Sections 1.704-1(b)(4)(i) and 1.704-1(b)(2)(iv)(m) of the
Regulations and except as otherwise provided in this Article VI, allocations of income,
gain, loss, deduction and credit for federal, state and local tax purposes shall be allocated to
the Partners in the same manner and amounts as the book items corresponding to such tax items are
allocated for Capital Account purposes.

               (b) Recapture Income. Notwithstanding Section 6.4(a) hereof, if there is a
gain on any sale, exchange or other disposition of Partnership assets and all or a portion of such
gain is characterized as ordinary income by virtue of the recapture rules of Code Section 1245 or
1250, or under the corresponding recapture rules of state or local income tax law, as the case may
be, then, to the extent possible, such recapture income for United States and state and local tax
purposes shall be allocated to the Partners in the ratio that they were allocated Tax Depreciation
previously taken and allowed with respect to the Partnership assets being sold or otherwise
disposed of.

               (c) Section 754 Adjustments. Notwithstanding Section 6.4(a) hereof, any
increase or decrease in the amount of any items of income, gain, loss, deduction or credit for tax
purposes attributable to an adjustment to the basis of Partnership assets made pursuant to a valid
election or deemed election under Sections 732(d), 734, 743, and 754 of the Code, and any increase
or decrease in the amount of any item of credit or tax preference attributable to any such
adjustment, shall be allocated to those Partners entitled thereto under such law. Such items shall
be excluded in determining the Capital Accounts of the Partners, except as otherwise provided by
Section 1.704-1(b)(2)(iv)(m) of the Regulations.

               (d) Nonrecourse Deductions. Any “Nonrecourse Deductions” as defined in Treasury
Regulations Section 1.704-2(c) for any fiscal year or other period shall be specially allocated as
items of loss in the manner provided in Treasury Regulations Section 1.704-2(j)(1)(ii).
Depreciation deductions shall be treated as Nonrecourse Deductions with respect to a property only
to the extent that such deductions reduce the property’s tax basis below the amount of the
Nonrecourse Liability encumbering the property.

               (e) Sharing of Excess Nonrecourse Liabilities. For purposes of Section 1.752-3(a)(3)
of the Regulations, the excess Nonrecourse Liabilities of the Partnership shall be allocated one
hundred (100%) percent to LMLP. In the event it is determined that Inland would be allocated less
than its proportionate share of depreciation in any year as a result of the allocation of
liabilities to LMLP, the Partners agree to reallocate the liabilities in accordance with Percentage
Interests.

               (f) Section 704(c). Notwithstanding Section 6.4 hereof, if the Partnership
owns or acquires Section 704(c) Property, or if the Tax Matters Partner makes an election referred
to in the definition of “Book Value” herein, then, solely for tax purposes and

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not for Capital Account purposes, Tax Depreciation, and any gain or loss, attributable to such
Section 704(c) Property shall be allocated between or among the Partners in a manner that takes
into account the variation between such Book Value and such adjusted tax basis, using the
traditional method of allocation, in accordance with the principles of Code Section 704(c) and the
Regulations promulgated thereunder and such method set forth in Regulations Section 1.704-3(b).

               Section 6.5 Tax Matters Partner. The General Partner is hereby designated as the “tax
matters partner” for the Partnership as such term is defined in Section 6231(a)(7) of the Code (the
“Tax Matters Partner”), and all federal, state and local tax audits and litigation shall be
conducted under the direction of the General Partner. All expenses incurred with respect to any
tax matter which does or may affect the Partnership, including but not limited to expenses incurred
in connection with Partnership level administrative or judicial tax proceedings, shall be paid out
of Partnership assets, whether or not included in an Annual Plan. The Tax Matters Partner shall,
promptly upon receipt thereof, forward to each Partner a copy of any correspondence relating to the
Partnership received from the Internal Revenue Service or any other tax authority which relates to
matters that are of material importance to the Partnership and/or the Partners. The Tax Matters
Partner shall promptly advise each Partner in writing of the substance of any material conversation
held with any representative of the Internal Revenue Service which relates to an audit or
administrative proceeding relating to a tax return of the Partnership.

               Section 6.6 Adjustments.

               (a) Generally. Except as otherwise provided in this Agreement, all items of
Partnership income, gain, loss and deduction and any other allocations not otherwise provided for
shall be divided among the Partners in the same proportions as they share Profits and Losses, as
the case may be, for the year.

               (b) Upon Transfer or Change in Percentage Interest. If any Percentage Interest is
transferred in any fiscal year in accordance with this Agreement, or if a Partner’s Percentage
Interest changes during any fiscal year, all Profits and Losses attributable to such Percentage
Interest for such fiscal year shall be divided and allocated in accordance with an interim closing
of the books as of the date of a transfer or change.

               (c) Amendments to this Article VI. The General Partner is specifically authorized by
each Partner, upon the advice of the accountants or legal counsel for the Partnership, to amend
this Article VI to comply with any Regulations with respect to the distributions and
allocations of the Partnership and any such amendment shall become effective; provided,
however, that if such amendment constitutes a Material Modification for any Partner, then such
amendment shall become effective only upon the express written consent of such Partner.

ARTICLE VII

DISTRIBUTIONS

               Section 7.1 Cash Available for Distributions.

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               (a) Generally. Notwithstanding anything herein to the contrary, no distribution shall
be made until all Priority Loans are paid in full.

               (b) Net Cash Flow from Operations.

          (i) Net Cash Flow from Operations of Qualified Acquired Assets. Following (x) the
satisfaction of accrued and unpaid interest on Priority Loans, in proportion to the outstanding
Priority Loans, if any, and (y) the satisfaction of outstanding principal balances on Priority
Loans, in proportion to the outstanding Priority Loans, if any, the General Partner shall cause the
Partnership to distribute all Net Cash Flow from Operations of Qualified Acquired Assets quarterly
on the 15th of January, April, July and October (each a “Distribution Date”, as follows:

               (A) first, to Inland until such time as Inland has received cumulative distributions in an
amount sufficient to achieve a 9% Cash-On-Cash Return (“Inland Priority Return”);

               (B) second, to LMLP in an amount equal to the Preferred Equity Return;

               (C) third, to LMLP, until such time as LMLP has received cumulative distributions in an amount
sufficient to achieve a 9% Cash-On-Cash Return (“LMLP Priority Return”);

               (D) fourth, to LMLP until all of the Preferred Equity has been redeemed (and any allocation of
Preferred Equity shall be reduced ratably in accordance with the Preferred Equity allocation set
forth on Schedule 1 hereto);

               (E) fifth, to the Partners pro rata in accordance with their Percentage Interests until all
Capital Contributions related to Qualified Acquired Assets made by the Partners have been returned
(for the purposes of this Section 7.1(a)(i)(E), Capital Contributions made by Inland
related to the Qualified Acquired Assets shall include Acquisition Fees (if any) paid by Inland and
Capital Contributions made by LMLP related to the Qualified Acquired Assets shall include 17.65% of
the amount of the Acquisition Fees (if any) paid by Inland); and

               (F) thereafter, (x) so long as LMLP GP is the General Partner, (1) 65% to Inland and (2) 35%
to LMLP, or (y) so long as LMLP GP is no longer the General Partner, (2) 85% to Inland and (2) 15%
to LMLP.

          (ii) Net Cash Flow from Operations of Qualified Assumed Assets. Following (x) the
satisfaction of accrued and unpaid interest on Priority Loans, in proportion to the outstanding
Priority Loans, if any, and (y) the satisfaction of outstanding principal balances on Priority
Loans, in proportion to the outstanding Priority Loans, if any, the General Partner shall cause the
Partnership to distribute all Net Cash Flow from Operations of Qualified Assumed Assets quarterly
on the Distribution Dates, as follows:

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               (A) first, to Inland until such time as Inland has received the Inland Priority Return;

               (B) second, to LMLP in an amount equal to the Preferred Equity Return;

               (C) third, to LMLP, until such time as LMLP has received the LMLP Priority Return;

               (D) fourth, to LMLP until all of the Preferred Equity has been redeemed (and any allocation of
Preferred Equity shall be reduced ratably in accordance with the Preferred Equity allocation set
forth on Schedule 1 hereto);

               (E) fifth, to Inland until all Capital Contributions related to Qualified Assumed Assets made
by Inland have been returned;

               (F) sixth, to LMLP until all Capital Contributions (excluding Preferred Equity Capital
Contributions) made by LMLP or credited on LMLP’s behalf have been returned; and

               (G) thereafter, (x) so long as LMLP GP is the General Partner, (1) 65% to Inland and (2) 35%
to LMLP, or (y) so long as LMLP GP is no longer the General Partner, (2) 85% to Inland and (2) 15%
to LMLP.

               (c) Net Cash Flow from Sales and Refinancings.

          (i) Net Cash Flow from Sales and Refinancings of Qualified Acquired Assets. Following
(w) the satisfaction of accrued and unpaid interest on Priority Loans, in proportion to the
outstanding Priority Loans, if any, and (x) the satisfaction of outstanding principal balances on
Priority Loans, in proportion to the outstanding Priority Loans, if any, the General Partner shall
cause the Partnership to distribute Net Cash from Sales and Financings of Qualified Acquired Assets
as soon as practicable after the receipt of such Net Cash from Sales or Refinancings of Acquired
Assets, as follows:

               (A) first, to LMLP to the extent of any unpaid Preferred Equity Redemption Amount related to a
prior sale or refinancing;

               (B) second, to Inland to the extent of any unpaid Inland Priority Return;

               (C) third, to LMLP to the extent of any accrued and unpaid Preferred Equity Return;

               (D) fourth, to LMLP to the extent of any unpaid LMLP Priority Return;

               (E) fifth, to the Partners pro rata in accordance with their Percentage Interests until all
Capital Contributions related to Qualified Acquired Assets made by

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the Partners have been returned (for the purposes of this Section 7.1(b)(i)(E),
Capital Contributions made by Inland related to the Qualified Acquired Assets shall include
Acquisition Fees (if any) paid by Inland and Capital Contributions made by LMLP related to the
Qualified Acquired Assets shall include 17.65% of the amount of the Acquisition Fees (if any) paid
by Inland); and

               (F) thereafter, (x) so long as LMLP GP is the General Partner, (1) 65% to Inland and (2) 35%
to LMLP, or (y) so long as LMLP GP is no longer the General Partner, (2) 85% to Inland and (2) 15%
to LMLP.

                    (ii) Net Cash Flow from Sales and Refinancings of Qualified Assumed Assets. Following
(w) the satisfaction of accrued and unpaid interest on Priority Loans, in proportion to the
outstanding Priority Loans, if any, and (x) the satisfaction of outstanding principal balances on
Priority Loans, in proportion to the outstanding Priority Loans, if any, the General Partner shall
cause the Partnership to distribute Net Cash from Sales and Financings of Qualified Assumed Assets
as soon as practicable after the receipt of such Net Cash from Sales or Refinancings of Qualified
Assumed Assets, as follows:

               (A) first, to LMLP to the extent of any unpaid Preferred Equity Redemption Amount related to a
prior sale or refinancing;

               (B) second, to Inland to the extent of any unpaid Inland Priority Return;

               (C) third, to LMLP to the extent of any accrued and unpaid Preferred Equity Return;

               (D) fourth to LMLP in an amount equal to the Preferred Equity Redemption Amount related to
such Qualified Assumed Asset (but in no event will the total amount distributed under this clause
(D) exceed the outstanding Preferred Equity Capital Contribution);

               (E) fifth, to LMLP to the extent of any unpaid LMLP Priority Return;

               (F) sixth, to Inland until all Capital Contributions related to Qualified Assumed Assets made
by Inland have been returned;

               (G) seventh, to LMLP until all Preferred Equity Capital Contributions have been returned or
redeemed;

               (H) eighth, to LMLP until all Capital Contributions related to Qualified Assumed Assets
(excluding Preferred Equity Capital Contributions) made by LMLP or credited on LMLP’s behalf have
been returned; and

               (I) thereafter, (x) so long as LMLP GP is the General Partner, (1) 65% to Inland and (2) 35%
to LMLP, or (y) so long as LMLP GP is no longer the General Partner, (1) 85% to Inland and (2) 15%
to LMLP.

50

 

               (d) Restrictions on Use of Distributable Cash. Distributable Cash shall not be used to
acquire Qualified Assets or make capital improvements on Qualified Assets unless approved in
accordance with Section 3.4 hereof.

               (e) Withholdings. The General Partner is authorized to withhold from distributions or
allocations to any Partner (or, in the event there are insufficient funds, require such Partner to
contribute to the Partnership) and to pay over to any federal, state or local government any
amounts required to be withheld pursuant to the Code or any provisions of any other federal, state
or local law with respect to any payment, distribution or allocation to the Partnership or such
Partner and shall allocate any such amounts to such Partner with respect to which such amount was
withheld. All amounts so withheld (including such amounts contributed by the Partner) shall be
treated as amounts distributed to such Partner, and will reduce the amount otherwise distributable
to such Partner, pursuant to this Article VII for all purposes under this Agreement.

               (f) Restrictions on Distributions. Notwithstanding anything to the contrary contained
in this Section 7.1, the Partnership shall not make a distribution to the extent that, at
the time of such distribution and after giving effect to such distribution, all liabilities of the
Partnership (other than liabilities to the Partners on account of their Capital Contributions or
liabilities for which the recourse of creditors is limited to specific assets of the Partnership)
shall exceed the Fair Market Value of the Partnership assets, except that the Fair Market Value of
Qualified Asset that is subject to a liability for which the recourse of the creditors is limited
shall be included in the Partnership assets only to the extent that the Fair Market Value of such
Qualified Asset exceeds that liability.

ARTICLE VIII

TRANSFER; REMOVAL OF GENERAL PARTNER

               Section 8.1 Prohibition on Transfers and Withdrawals by Partners.

               (a) The Partners shall be prohibited from, directly or indirectly, transferring, assigning,
pledging or hypothecating their respective interests (or any part of such interests) in the
Partnership and any attempted transfer shall be void ab initio; provided, that the following
transfers shall be permitted:

          (i) assignments of a Partner’s interest in the Partnership (but only its entire interest) to
an Affiliate of such Partner, but only upon fifteen (15) days written notice to the other Partners;

          (ii) transfers up to 49% of the ownership interests in a Partner, so long as the management of
such Partner immediately prior to such transfer possesses, directly or indirectly, the power to
direct or cause the direction of the management or policies of such Partner following such
transfer, whether through the ability to exercise voting power, by contract or otherwise;

          (iii) transfers by inheritance, devise, bequest or by operation of law upon the death of a
natural person; and

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          (iv) sales, transfers or issuance of shares of capital stock in LXP and securities convertible
into capital stock in LXP, provided a class of capital stock in LXP is listed on a nationally
recognized stock exchange or market.

               (b) Except as provided in this Section 8.1 and in Section 8.2,
Section 11.1 and Section 11.2 hereof, the Partners shall be prohibited from
withdrawing from the Partnership. If any Partner withdraws from the Partnership, it shall be and
remain liable for all obligations and liabilities incurred by it as a Partner, and shall be liable
to the Partnership and the other Partners for all indemnifications set forth herein and for any
liabilities, losses, claims, damages, costs and expenses (including reasonable attorneys’ fees)
incurred by the Partnership as a result of any withdrawal in breach of this Agreement.

               Section 8.2 Removal of LMLP GP as General Partner. Upon a Removal Event, Inland shall
have the right to remove the General Partner for a period of sixty (60) days following the
occurrence of a Removal Event, and if such right is timely exercised, Inland shall have the right
to appoint either Inland or an Affiliate of Inland as the new General Partner. Such removal of
LMLP GP shall be effective ten (10) Business Days after receipt by LMLP GP of written notice from
Inland. Upon such removal, notwithstanding anything in this Agreement or the Management Agreement
to the contrary, (a) LMLP GP shall cease to be a general partner and a partner of the Partnership;
(b) two of the three members of the Executive Committee appointed by LMLP shall be removed and
replacements shall be appointed by Inland; (c) the Management Agreement shall terminate; and (d)
either Inland or one of its Affiliates shall be appointed the General Partner of the Partnership
and this Agreement shall be amended to reflect such appointment.

ARTICLE IX

TERMINATION

               Section 9.1 Dissolution. The Partnership shall dissolve and commence winding up and
liquidating upon the first to occur of any of the following (collectively, the “Liquidating
Events”):

          (i) the reduction to cash or cash equivalents (other than purchase money notes obtained by the
Partnership from the sale of Qualified Asset) of the last remaining Qualified Asset;

          (ii) the agreement in writing by the Partners to dissolve the Partnership;

          (iii) the entry of a decree of judicial dissolution of the Partnership pursuant to
Section 17-802 of the Act;

          (iv) the election of any Partner to dissolve the Partnership on the seventh anniversary of
March 1, 2008 or any anniversary thereafter;

          (v) all of the Qualified Assets have been sold to LMLP, or its designees, or to Inland, or its
designees, pursuant to the exercise of the Buy/Sell as provided in Section 11.2 hereof;

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          (vi) the Bankruptcy of any LMLP Partner or Inland;

          (vii) the election of LMLP to dissolve the Partnership after (A) LMLP GP is no longer the
General Partner and (B) a breach by Inland or the General Partner of (x) Articles VI or
VII hereof, which remains uncured for thirty (30) days following receipt of notice of such
breach from LMLP, or (y) Section 12.19 hereof.

          (viii) the election of Inland to dissolve the Partnership after the removal of LMLP GP as the
General Partner upon a Removal Event.

               Section 9.2 Termination. In all cases of dissolution of the Partnership, the business
of the Partnership shall be wound up and the Partnership terminated as promptly as practicable
thereafter, and each of the following shall be accomplished:

          (i) The Liquidator shall cause to be prepared a statement setting forth the assets and
liabilities of the Partnership as of the date of dissolution, a copy of which statement shall be
furnished to each Partner;

          (ii) The Qualified Assets and assets of the Partnership shall be liquidated by the Liquidator
as promptly as possible, but in an orderly and businesslike and commercially reasonable manner,
consistent with maximizing the price to be received. The Liquidator in its reasonable discretion
shall determine whether to sell any Qualified Asset at a public or private sale, for such price and
on such terms as the Liquidator shall determine in its sole discretion. The Liquidator may, in the
exercise of its good faith business judgment and if commercially reasonable, determine not to sell
a portion of the Qualified Assets and assets of the Partnership, in which event such Qualified
Assets and assets shall be distributed in kind pursuant to clause (iv) below;

          (iii) Any Profit or Loss realized by the Partnership upon the sale or other disposition of its
assets pursuant to Section 9.2(ii) above shall be allocated to the Partners as required by
Article VI hereof; and

          (iv) The proceeds of sale and all other assets of the Partnership shall be applied and
distributed as follows and in the following order of priority:

               (A) To the payment of the debts and liabilities of the Partnership and the expenses of
Liquidation;

               (B) To the setting up of any reserves which the Liquidator shall reasonably determine to be
necessary for contingent, unliquidated or unforeseen liabilities or obligations of the Partnership
or the Partners arising out of or in connection with the Partnership. Such reserves may, in the
discretion of the Liquidator, be paid over to a national bank or national title company selected by
it and authorized to conduct business as an escrowee to be held by such bank or title company as
escrowee for the purposes of disbursing such
reserves to satisfy the liabilities and obligations described above, and at the expiration of
such period as the Liquidator may reasonably deem advisable, distribute any remaining balance in
the manner set forth below; and

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               (C) The balance, if any, to the Partners in accordance with Sections 7.1(c) hereof.

               No payment or distribution in any of the foregoing categories shall be made until all payments
in each prior category shall have been made in full. If the payments due to be made in any of the
foregoing categories exceed the remaining assets available for such purpose, such payment shall be
made to the Persons entitled to receive the same pro rata in accordance with the
respective amount due them.

               Payments described in clause (iv) above must be made in cash. The Partners shall continue to
share profits, losses and other tax items during the period of liquidation in the same proportions
as before dissolution.

               Section 9.3 Certificate of Cancellation. Upon completion of the distribution of the
Partnership’s assets as provided in this Article IX and the completion of the winding-up of
the affairs of the Partnership, the Partnership shall be terminated, and the Liquidator shall cause
the filing of a certificate of cancellation of the certificate of limited partnership in the office
of the Secretary of State of the State of Delaware in accordance with the Act and shall take all
such other actions as may be necessary to terminate the Partnership in accordance with the Act and
shall take such other actions as may be necessary to terminate the Partnership’s registration in
any other jurisdictions where the Partnership is registered or qualified to do business.

               Section 9.4 Acts in Furtherance of Liquidation. Each Partner or former Partner, upon
the request of the Liquidator, shall promptly execute, acknowledge and deliver all documents and
other instruments as the Liquidator shall reasonably request to effectuate the proper dissolution
and termination of the Partnership, including the winding up of the business of the Partnership.

ARTICLE X

REPRESENTATIONS OF THE PARTNERS

               Section 10.1 Representations of Inland. Inland hereby represents and warrants to the
LMLP Partners and the Partnership as follows:

          (i) this Agreement constitutes the valid and binding agreement of Inland, enforceable against
Inland in accordance with its terms, subject as to enforcement of bankruptcy, insolvency and other
similar laws affecting the rights of creditors and to general principles of equity;

          (ii) Inland has been duly formed and is validly existing as a limited liability company in
good standing under the laws of the State of Delaware, with all requisite power and authority to
enter into this Agreement, to carry out the provisions and
conditions hereof and to perform all acts necessary or appropriate to consummate all of the
transactions contemplated hereby;

          (iii) Inland has all requisite power and authority to enter into this Agreement, to carry out
the provisions and conditions hereof and to perform all acts

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necessary or appropriate to consummate all of the transactions contemplated hereby and no further action by Inland is necessary to
authorize the execution or delivery of this Agreement;

          (iv) this Agreement has been duly and validly executed and delivered by Inland and the
execution, delivery and performance hereof by Inland does not and will not (i) require the approval
of any other Person, or (ii) contravene or result in any breach of or constitute any default under,
or result in the creation of any lien upon Inland’s assets under, any indenture, mortgage, loan
agreement, lease or other agreement or instrument to which Inland is a party or by which Inland or
any of its assets is bound;

          (v) the formation of the Partnership does not and the consummation of the transactions
contemplated herein will not result in any violation of the organizational documents of Inland;

          (vi) Inland has the financial capacity to perform its obligations under this Agreement;

          (vii) no finder’s, broker’s or similar fee or commission has been paid or shall be paid by
Inland to any individual or organization in connection with the formation of the Partnership;
provided, however, that Inland may pay fees to related parties;

          (viii) there is no action, suit or proceeding pending or, to its knowledge, threatened against
Inland that questions the validity or enforceability of this Agreement or, if determined adversely
to it, would materially adversely affect the ability of Inland to perform its obligations
hereunder;

          (ix) Inland is not the subject of any Bankruptcy;

          (x) to Inland’s knowledge, Inland has not received from any governmental agency any notice of
violation of any law, statute or regulation which would have a material adverse effect on the
Partnership;

          (xi) to Inland’s knowledge, Inland is not in default in the performance or observation of any
obligation under any agreement or instrument to which it is a party or by which it or any of its
assets is bound, which default would individually or in the aggregate with other defaults
materially adversely affect the business or financial condition of Inland or the Partnership; and

          (xii) Inland (which for the purposes of this Section 10.2(x) includes its partners, members,
principal stockholders owning more than ten percent (10%) of the outstanding capital stock of
Inland, and any other constituent entities) (1) has not been designated as a “specifically
designated national and blocked person” on the most current list published by the U.S. Treasury
Department Office of Foreign Assets Control at its official
website, http://www.treas.gove/ofac/t11sdn.pdf or at any replacement website or other
replacement official publication of such list, and (2) is currently in compliance with the
regulations of the Office of Foreign Asset Control of the Department of the Treasury and any
statute, executive order (including the September 24, 2001, Executive Order Blocking Property

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and Prohibiting Transactions with Persons Who Commit, Threaten to Commit, or Support Terrorism), or
other governmental action relating thereto.

               Section 10.2 Representations of the LMLP Partners. Each LMLP Partner represents and
warrants to Inland and the Partnership as follows:

          (i) this Agreement constitutes the valid and binding agreement of such LMLP Partner
enforceable against such LMLP Partner in accordance with its terms, subject as to enforcement to
bankruptcy, insolvency and other similar laws affecting the rights of creditors and to general
principles of equity;

          (ii) LMLP has been duly formed and is validly existing as a limited partnership in good
standing under the laws of the State of Delaware, with all requisite power and authority to enter
into this Agreement, to carry out the provisions and conditions hereof and to perform all acts
necessary or appropriate to consummate all of the transactions contemplated hereby;

          (iii) LMLP GP has been duly formed and is validly existing as a limited liability company in
good standing under the laws of the State of Delaware, with all requisite power and authority to
enter into this Agreement, to carry out the provisions and conditions hereof and to perform all
acts necessary or appropriate to consummate all of the transactions contemplated hereby;

          (iv) such LMLP Partner has all requisite power and authority to enter into this Agreement, to
carry out the provisions and conditions hereof and to perform all acts necessary or appropriate to
consummate all of the transactions contemplated hereby and no further action by such LMLP Partner
is necessary to authorize the execution or delivery of this Agreement;

          (v) this Agreement has been duly and validly executed and delivered by such LMLP Partner and
the execution, delivery and performance hereof by such LMLP Partner does not and will not
(x) require the approval of any other Person or (y) contravene or result in any breach of or
constitute any default under, or result in the creation of any lien upon such LMLP Partner’s assets
under, any indenture, mortgage, loan agreement, lease or other agreement or instrument to which
such LMLP Partner or any LMLP Affiliated Party is a party or by which such LMLP Partner or any of
its assets is bound;

          (vi) to such LMLP Partner’s knowledge, such LMLP Partner is not in default in the performance
or observation of any obligation under any agreement or instrument to which it is a party or by
which it or any of its assets is bound, which default would individually or in the aggregate with
other defaults materially adversely affect the business or financial condition of such LMLP Partner
or the Partnership;

          (vii) the formation of the Partnership does not and the consummation of the transactions
contemplated herein will not result in any violation of the organizational documents of such LMLP
Partner;

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          (viii) no finder’s, broker’s or similar fee or commission has been paid or shall be paid to
any individual or organization in connection with the formation of the Partnership except for fees
payable to Wachovia Capital Markets, LLC, which shall be paid by LMLP and not the Partnership;

          (ix) there is no action, suit or proceeding pending or, to its knowledge, threatened against
such LMLP Partner that questions the validity or enforceability of this Agreement or, if determined
adversely to it, would materially adversely affect the ability of such LMLP Partner to perform its
obligations hereunder;

          (x) such LMLP Partner is not the subject of any Bankruptcy;

          (xi) to such LMLP Partner’s knowledge, such LMLP Partner has not received from any
governmental agency any notice of violation of any law, statute or regulation which would have a
material adverse effect on the financial condition of such LMLP Partner or of the Partnership;

          (xii) each LMLP Partner has the financial capacity to perform its obligations under this
Agreement; and

          (xiii) each LMLP Partner (which for the purposes of this Section 10.2(x) includes its
partners, members, principal stockholders owning more than ten percent (10%) of the outstanding
capital stock of such LMLP Partner, and any other constituent entities) (1) has not been designated
as a “specifically designated national and blocked person” on the most current list published by
the U.S. Treasury Department Office of Foreign Assets Control at its official website,
http://www.treas.gove/ofac/t11sdn.pdf or at any replacement website or other replacement official
publication of such list, and (2) is currently in compliance with the regulations of the Office of
Foreign Asset Control of the Department of the Treasury and any statute, executive order (including
the September 24, 2001, Executive Order Blocking Property and Prohibiting Transactions with Persons
Who Commit, Threaten to Commit, or Support Terrorism), or other governmental action relating
thereto.

ARTICLE XI

SPECIAL PARTNER RIGHTS AND OBLIGATIONS

               Section 11.1 Right of First Offer.

               (a) At any time after the Rights Trigger Date, if either Inland or LMLP (except if the Rights
Trigger Date occurs because of an Event of Default by an LMLP Partner) wishes to sell their
Percentage Interest or cause the Partnership to sell any Qualified Asset (for the purposes of this
section, such selling Partner, the “ROFO Offering Partner”), the ROFO Offering Partner shall
deliver a written notice (a “ROFO Notice”) to the Other Partner (the “ROFO Responding Partner)”)
specifying to the ROFO Responding Partner in writing the terms and conditions (the “ROFO Terms”) and the price (the “ROFO Offer Price”) at which the
ROFO Offering Partner would be willing to sell their entire Percentage Interest or the ROFO
Offering Partner would be willing to permit the Partnership to sell any of the Qualifying Assets,
as the case may be, to the ROFO Responding Partner. Any ROFO Notice shall reference the

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invocation of this Section 11.1 and shall constitute an irrevocable offer from the
ROFO Offering Partner to the ROFO Responding Partner to sell its entire Percentage Interest or
permit the sale by the Partnership of the stated Qualifying Assets, as the case may be, at the ROFO
Offer Price. If the ROFO Responding Partner does not elect to buy the ROFO Offering Partner’s
entire Percentage Interest or the stated Qualifying Assets, as the case may be, within forty-five
(45) days following receipt of the ROFO Notice by delivering an election notice to the ROFO
Offering Partner (the “ROFO Response Notice”), subject to Sections 11.1(b) and (c),
the ROFO Offering Partner shall be permitted to sell their entire Percentage Interest or the stated
Qualifying Assets on behalf of the Partnership, as the case may be, to a bona fide third party
pursuant to an arm’s length transaction on terms not more favorable to such bona fide third party
than the ROFO Terms and for an amount equal to or greater than the ROFO Offer Price (the “Required
Third Party Price and Terms”). In the event the ROFO Responding Partner fails to timely deliver a
ROFO Response Notice, subject to Sections 11.1(b) and (c), the ROFO Offering
Partner shall be permitted to sell its entire Percentage Interest or any of the Qualifying Assets
on behalf of the Partnership, as the case may be, for the Required Third Party Price and Terms.

               (b) In the event the ROFO Offering Partner is permitted to sell its entire Percentage Interest
or the stated Qualifying Assets on behalf of the Partnership, as the case may be, pursuant to
Section 11.1(a) above, the ROFO Offering Partner shall have the right for a period of six
(6) months after the date of the ROFO Notice (the “Third Party Sale Period”) to sell its entire
Percentage Interest or the stated Qualifying Assets on behalf of the Partnership, as the case may
be, to a bona fide third party for and on the Required Third Party Price and Terms. In the event
the ROFO Offering Partner fails to consummate the sale of its entire Percentage Interest or the
stated Qualifying Assets on behalf of the Partnership, as the case may be, for the Required Third
Party Price prior to the expiration of the Third Party Sale Period, the ROFO Offering Partner’s
right to sell its entire Percentage Interest or the stated Qualifying Assets on behalf of the
Partnership, as the case may be, to a bona fide third party will be revoked until such time as the
ROFO Offering Partner has repeated the process set forth in Section 11.1(a) and provided
the ROFO Responding Partner with the right to make its election pursuant to Section 11.1(a)
above.

               (c) Any exercise of the provisions of this Section 11.1 is also subject to the
provisions of Section 11.3 below.

               Section 11.2 Buy/Sell.

               (a) Generally. After the Rights Trigger Date, Inland or LMLP (except if the Rights
Trigger Date occurs because of an Event of Default by an LMLP Partner), as specified therein (the
"Buy/Sell Offering Partner”), may provide the Other Partner (the “Buy/Sell Responding Partner”)
with notice (the “Buy/Sell Notice”) of a price (the “Buy/Sell Offer Price”) that the Buy/Sell
Offering Partner, or its designated Affiliate(s), is willing to pay to purchase (A) those Qualified
Assets which the Buy/Sell Offering Partner, or its designated Affiliate(s), desire to purchase if
the Buy/Sell Offering Partner, or its designated Affiliate(s), desire to purchase less than all of
the Qualified Assets from the Partnership, or (B) all of the Qualified Assets if the Buy/Sell
Offering Partner, or its designated Affiliate(s), desire to purchase all of the Qualified Assets
(provided that an offer to purchase all of the Qualified Assets shall be implemented as a purchase
by the Buy/Sell Offering Partner, or its designated

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Affiliate(s), of the Percentage Interests of the Buy/Sell Responding Partner) (such Qualified
Assets or such Percentage Interests, as the case may be, the “Buy/Sell Asset”). The Buy/Sell
Notice shall include, as an attachment thereto, a bona fide proposed purchase and sale agreement on
terms reasonably customary for the sale of real estate assets or for the sale of partnership
interests in a limited partnership that owns primarily real estate assets (the “Offered
Agreement”). Upon receipt of the Buy/Sell Notice, the Buy/Sell Responding Partner shall have
forty-five (45) days to provide to the Buy/Sell Offering Partner a notice (the “Buy/Sell Response
Notice”) specifying the Buy/Sell Responding Partner’s election either, (i) if the Buy/Sell Asset
comprises less than all of the Qualified Assets, to cause the Partnership to sell the Buy/Sell
Asset to the Buy/Sell Offering Partner, or its designated Affiliate(s), at the Buy/Sell Offer Price
pursuant to the Offered Agreement or (y) to purchase (or have a designated Affiliate(s) purchase)
the Buy/Sell Asset from the Partnership for a purchase price equal to the Buy/Sell Offer Price and
on substantially the same terms and conditions as provided in the Offered Agreement, or, (ii) if
the Buy/Sell Asset comprises all of the Qualified Assets, purchase the Percentage Interest of the
Buy/Sell Offering Partner or sell its Percentage Interest to the Buy/Sell Offering Partner, or its
designated Affiliate(s), for a purchase price equal to the amount the Buy/Sell Responding Partner
would receive under Section 9.2 hereof if the Partnership assets were sold at the Buy/Sell
Offer Price and the Partnership were liquidated and dissolved (the “Buy/Sell Responding Interest
Price”) and on substantially the same terms and conditions as provided in the Offered Agreement.
Any Buy/Sell Notice made with respect to all of the Qualified Assets in connection with an Event of
Default shall supersede and render of no further effect any Buy/Sell Notice or ROFO Notice (x) made
with respect to less than all of the Qualified Assets and (y) to which no Buy/Sell Response Notice
or ROFO Response Notice, as the case may be, has been provided to the Buy/Sell Offering Partner or
ROFO Offering Partner, as the case may be.

               (b) Buy/Sell Responding Partner’s Election to Purchase. If the Responding Partner
timely delivers a Buy/Sell Response Notice that specifies the Buy/Sell Responding Partner’s
election to purchase the Buy/Sell Asset, as described in Section 11.2(a) above, then the
Buy/Sell Responding Partner shall have up to seventy-five (75) days from the date of the delivery
of the Buy/Sell Response Notice to close the purchase of the Buy/Sell Asset on substantially the
same terms and conditions as contained in the Offered Agreement.

               (c) Buy/Sell Responding Partner’s Election not to Purchase. If the Buy/Sell
Responding Partner timely delivers a Buy/Sell Response Notice that specifies the Buy/Sell
Responding Partner’s election not to purchase the Buy/Sell Asset, or if the Buy/Sell Responding
Partner fails to deliver a timely Buy/Sell Response Notice, then (i) if the Buy/Sell Asset
comprises less than all of the Qualified Assets, the General Partner shall cause the Partnership to
proceed to close the acquisition of the Buy/Sell Asset at the Buy/Sell Offer Price in accordance
with the terms and conditions of the Offered Agreement, provided, however, that such
closing must take place within the seventy-five (75) day period beginning on the date of delivery
of the Buy/Sell Response Notice, or, (ii) if the Buy/Sell Asset comprises all of the Qualified
Assets, the Buy/Sell Offering Partner shall purchase the Percentage Interests of the Buy/Sell
Responding Partner within the seventy-five (75) day period described in clause (i) above, for the
Buy/Sell Responding Interest Price. In determining the amount of the Buy/Sell Responding Interest
Price, it will be assumed that no reserves will be required pursuant to Section 9.2 hereof.

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               Section 11.3 Provisions Applicable to Right of First Offer and Buy/Sell 

               (a) The Purchasing Partner shall deliver to a mutually acceptable escrow agent a
non-refundable cash deposit within forty-five (45) days of the Responding Partner’s actual or
deemed notice in an amount equal to the lesser of (i) five percent (5%) of the Offer Price, as
applicable, or (ii) $1,000,000 (the “Deposit”) to secure the Purchasing Partner’s obligations
hereunder.

               (b) Closing of any transfer pursuant to Section 11.1 or Section 11.2 above
(“Closing”) shall occur on the thirtieth (30th) day following the date of the escrow agent’s
receipt of the Purchasing Partner’s deposit as contemplated by Section 11.3(b) above (or,
if such day is not a Business Day, the next succeeding Business Day) (the “Closing Date”), at the
principal place of business of the Partnership, or at such other time and place as may be mutually
agreed upon by the Purchasing Partner and the Selling Partner, and (unless otherwise agreed to by
the Purchasing Partner and the Selling Partner) shall be on a cash basis. At such Closing: (i) the
Selling Partner shall convey all of its Percentage Interest in the Partnership, and, if applicable,
all of their debt claims against the Partnership, and warrant that such interests and claims are
free of all adverse claims and encumbrances (unless otherwise agreed upon by the Purchasing Partner
and the Selling Partner); (ii) the Purchasing Partner shall pay the Selling Partner the Offer
Price, less a credit for the Deposit (which shall be delivered by the escrow agent to the Selling
Partner and the amount thereof credited against the Offer Price), and as adjusted by customary
closing prorations and customary closing costs, in cash; and (iii) the Selling Partner, the
Purchasing Partner and the Partnership shall execute and deliver such other documents as may be
appropriate to effect, evidence and perfect the transaction.

               (c) Should the Purchasing Partner fail to close the transactions elected pursuant to
Section 11.1 or Section 11.2 above prior to the Closing Date, the Selling Partner,
as its exclusive remedies in the circumstances, (i) shall be entitled to receive from the escrow
agent, as liquidated damages for such failure, the Deposit deposited pursuant to Section
11.3(b) of this Agreement, (ii) shall have the right for a period of twelve (12) months after
the scheduled Closing Date (the “Default Sale Period”) to acquire the Purchasing Partner’s
Percentage Interest or interest in the stated Qualified Assets, as the case may be, for 95% of the
Offer Price, and (iii) the Purchasing Partner’s rights pursuant to Section 11.1 and
11.2 hereof shall be suspended for a period of twelve (12) months after the scheduled
Closing Date.

               (d) In connection with a transfer pursuant to Sections 11.1 or 11.2, the
Purchasing Partner may designate an Affiliate or Affiliates to acquire the Selling Partner’s
Percentage Interests or interests in the stated Qualified Assets, as the case may be, in which
event such Affiliate(s) shall acquire such Percentage Interest or interests in the stated Qualified
Assets, as the case may be, but no such designation or acquisition shall relieve the Purchasing
Partner (as determined without regard to this Section 11.3(e)) from any obligation under this
Article XI.

               (e) Each of Inland and LMLP shall have the right to exercise either the Right of First Offer
pursuant to Section 11.1 above or the Buy/Sell pursuant to Section 11.2 above (such
Partner being the “Initiating Partner”); provided, however, that upon any

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Initiating Partner’s exercise of either of these provisions, the Other Partner may not again
trigger the provisions of either Section 11.1 or 11.2 until the termination of all
procedures and timeframes pursuant to the Initiating Partner’s chosen provision.

               (f) As a condition to any transfer by either Inland or LMLP of its Percentage Interest or the
stated Qualified Assets by the Partnership, as the case may be, pursuant to either Section
11.1 or Section 11.2 of this Agreement, the Selling Partner must be released at the
closing from any indemnities, guaranties or other credit enhancements granted by such Selling
Partner on behalf of the Partnership to any third party relating to the interest being transferred.

               (g) As a condition to any transfer by Inland of its Percentage Interest or the stated
Qualified Assets by the Partnership, as the case may be, pursuant to either Section 11.1 or
Section 11.2 of this Agreement, any Preferred Equity relating to a Qualified Assumed Asset
that is being, directly or indirectly, transferred shall be redeemed as if such Qualified Assumed
was sold and the proceeds were distributed in accordance with Section 7.2(c) hereof.

               (h) If either Inland or LMLP initiates a legal action with respect to any exercise of the
other Partner’s rights under this Article XI, the losing Partner shall pay all attorneys’
fees and court costs arising in connection with such legal action.

               (i) Each Partner shall bear its own costs, such as due diligence expenses and consultants’ and
attorneys’ fees, incurred in connection with its exercise of, or response to, any rights under this
Article XI.

ARTICLE XII

GENERAL PROVISIONS

               Section 12.1 Notices.

               (a) Generally. All notices, demands, approvals, consents or requests provided for or
permitted to be given pursuant to this Agreement must be in writing.

               (b) Manner of Notice. All notices, demands, approvals, consents and requests to be
sent to the Partnership or any Partner pursuant to the terms hereof shall be deemed to have been
properly given or served, if personally delivered, sent by recognized messenger or next day courier
service, or sent by United States mail, telex or facsimile transmission to the addresses or
facsimile numbers listed below, and will be deemed received, unless earlier received: (a) if sent
by express, certified or registered mail, return receipt requested, when actually received or
delivery refused; (b) if sent by messenger or courier, when actually received; (c) if sent by telex
or facsimile transmission, on the date sent, so long as a confirming notice is sent by messenger or
courier or by express, certified, registered, or first-class mail; (d) if delivered by hand, on the
date of delivery; and (e) if sent by first-class mail, seven days after it was mailed. Rejection
or other refusal to accept or the inability to deliver because of changed address of which no
notice was given shall be deemed to be receipt of the notice, demand or request sent.

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	If to the Partnership:

	 	Net Lease Strategic Assets Fund L.P.

c/o Lexington Realty Trust

One Penn Plaza, Suite 4015

New York, New York 10119-4015

Attention: Chief Executive Officer

Fax No. (212) 594-6600
	 
	 	 
	with a copy to:

	 	Inland American (Net Lease) Sub, LLC

c/o Inland American Real Estate Trust, Inc.

2901 Butterfield Road

Oak Brook, Illinois 60523

Attention:

Fax No.: (630)
	 
	 	 
	If to either LMLP
Partner:

	 	c/o Lexington Realty Trust

One Penn Plaza, Suite 4015

New York, New York 10119-4015

Attention: Chief Executive Officer

Fax No. (212) 594-6600

	 
	 	 
	with a copy of any
notice to:

	 	Post, Heymann & Koffler LLP

Wing A, Suite 211

Two Jericho Plaza

Jericho, New York 11753

Attention: David Heymann, Esq.

Fax No.: (516) 433-2777
	 
	 	 
	If to Inland:

	 	Inland American (Net Lease) Sub, LLC

c/o Inland America Real Estate Trust, Inc.

2901 Butterfield Road

Oak Brook, Illinois 60523

Attention: Lori Foust and Scott Wilton

Fax No.: (630)
	 
	 	 
	and a copy of any
notices to:

	 	Levenfeld Pearlstein LLC

2 North LaSalle, Suite 1300

Chicago, Illinois 60602

Attention: Marc Joseph and Russell Shapiro

Fax No.: (312) 346-8434

               (c) Right to Change Addresses. A Partner shall have the right from time to time and
at any time during the term of this Agreement to change its notice address or addresses by giving
to the Other Partners at least ten (10) Business Days’ prior written notice thereof in the manner
provided by this Section 12.1.

               Section 12.2 Governing Laws. This Agreement and the obligations of the Partners
hereunder shall be interpreted, construed and enforced in accordance with the laws of the State of
Delaware without regard to its choice of law provisions. Except as otherwise provided herein, the
rights and obligations of the Partners and the administration and termination of the Partnership
shall be governed by the Act.

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               Section 12.3 Entire Agreement. This Agreement (including the exhibits and schedules
hereto) contains the entire agreement between the parties, supercedes any prior agreements or
understandings between them and may not be modified or amended in any manner other than pursuant to
Section 12.12 hereof; provided that this Agreement shall not supercede the Agreement
Relating To Post Closing Matters, dated December 20, 2007, among the Partners.

               Section 12.4 Waiver. No consent or waiver, express or implied, by any Partner to or
of any breach or default by any other Partner in the performance by the other Partner of its
obligations hereunder shall be deemed or construed to be a consent or waiver to or of any other
breach or default in the performance by such other Partner of the same or any other obligations of
such other Partner hereunder. Failure on the part of any Partner to complain of any act or failure
to act of any of the other Partners or to declare any of the other Partners in default,
irrespective of how long such failure continues, shall not constitute a waiver by such Partner of
its rights hereunder. No custom, practice or course of dealings arising among the Partners in the
administration hereof shall be construed as a waiver or diminution of the right of any Partner to
insist upon the strict performance by any other Partner of the terms, covenants, agreements and
conditions herein contained.

               Section 12.5 Validity. If any provision of this Agreement or the application thereof
to any Person or circumstance shall be invalid or unenforceable to any extent, the remainder of
this Agreement and the application of such provisions to other Persons or circumstances shall not
be affected thereby and shall be enforced to the greatest extent permitted by law.

               Section 12.6 Terminology; Captions. All personal pronouns used in this Agreement,
whether used in the masculine, feminine, or neuter gender, shall include all other genders; the
singular shall include the plural, and vice versa and shall refer solely to the parties signatory
hereto except where otherwise specifically provided. Titles of Articles, Sections, Subsections,
Schedules and Exhibits are for convenience only, and neither limit nor amplify the provisions of
the Agreement itself, and all references herein to Articles, Sections, Subsections, Schedules and
Exhibits shall refer to the corresponding Articles, Sections, Subsections, Schedules and Exhibits
of this Agreement unless specific reference is made to such Articles, Sections, Subsections,
Schedules and Exhibits of another document or instrument. Any use of the word “including” herein
shall, unless the context otherwise requires, be deemed to mean “including without limitation”.

               Section 12.7 Remedies Not Exclusive. Except as otherwise provided herein, the rights
and remedies of the Partnership and of the Partners hereunder shall not be mutually exclusive,
i.e., the exercise of one or more of the provisions hereof shall not preclude the exercise of any
other provisions hereof. Each of the Partners confirms that damages at law may be an inadequate
remedy for a breach or threatened breach of this Agreement and agrees that in the event of a breach
or threatened breach of any provision hereof, the respective rights and obligations hereunder shall
be enforceable by specific performance, injunction or other equitable remedy but nothing herein
contained is intended to, nor shall it, limit or affect any rights or rights at law or by statute
or otherwise of any party aggrieved as against the other for breach or threatened breach of any
provision hereof, it being the intention by this section to

63

 

make clear the agreement of the Partners that the respective rights and obligations of the
Partners hereunder shall be enforceable in equity as well as at law or otherwise.

               Section 12.8 Action by the Partners. No approval, consent, designation or other
action by a Partner shall be binding upon such Partner unless the same is in writing and executed
on behalf of such Partner by a duly authorized representative of such Partner.

               Section 12.9 Further Assurances. Each of the Partners shall hereafter execute and
deliver such further instruments and do such further acts and things as may be required or useful
to carry out the intent and purpose of this Agreement and as are not inconsistent with the terms
hereof.

               Section 12.10 Liability of the Limited Partners. Each Limited Partner’s exposure to
liabilities hereunder is limited to its interest in the Partnership. No Limited Partner shall be
personally liable for the expenses, liabilities, debts, or obligations of the Partnership.

               Section 12.11 Binding Effect. Except as otherwise provided in this Agreement, every
covenant, term, and provision of this Agreement shall be binding upon and inure to the benefit of
the Partners and their respective successors, transferees, and assigns.

               Section 12.12 Amendments. Except as otherwise provided in this Agreement, this
Agreement may not be amended without the written consent of all the Partners.

               Section 12.13 Counterparts. This Agreement may be executed in any number of
counterparts and by the different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed to be an original, but all such counterparts together shall
constitute but one and the same instrument; signature and acknowledgment pages may be detached from
multiple separate counterparts and attached to a single counterpart so that all signature and
acknowledgement pages are physically attached to the same document. This Agreement shall become
effective upon the execution of a counterpart hereof by each of the parties hereto and delivery to
each of the Partners of a fully executed original counterpart of this Agreement.

               Section 12.14 Waiver of Partition. Each of the Partners hereby irrevocably waives any
and all rights (if any) that it may have to maintain any action for partition of any of the
Qualified Assets to be acquired.

               Section 12.15 No Third Party Beneficiaries. Supplementing Section 5.4 hereof,
nothing in this Agreement, expressed or implied, is intended to confer any rights or remedies upon
any Person, other than the Partners and, subject to the restrictions on assignment contained
herein, their respective successors and assigns.

               Section 12.16 Expenses. Each party hereto shall pay all of its own legal and
accounting fees and expenses incurred in connection with the formation of the Partnership and the
preparation and negotiation of this Agreement and the agreements ancillary hereto.

64

 

               Section 12.17 Jurisdiction; Venue. Each party hereto hereby irrevocably and
unconditionally (a) agrees that any action, suit or other legal proceeding brought in connection
with or relating to this Agreement or any matter contemplated hereby shall be brought exclusively
in a court of competent jurisdiction located in New Castle County, Delaware, whether a state or
federal court, and shall not be brought in any court or forum outside New Castle County, Delaware;
(b) consents and submits to, and agrees that it will not assert (by way of motion, as a defense or
otherwise) that it is not subject to, personal jurisdiction in connection with any such action,
suit or proceeding in any such court; and (c) waives to the fullest extent permitted by law, and
agrees that it will not assert (by way of motion, as a defense or otherwise), any claim that the
laying of venue of any such action, suit or proceeding in any such court is improper or that any
such action, suit or proceeding brought in any such court was brought in an inconvenient forum or
should be stayed by reason of the pendency of some other action, suit or other legal proceeding in
a court or forum other than any such court.

               Section 12.18 Jury Waiver. EACH PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY
WAIVES TO THE FULLEST EXTENT PERMITTED BY LAW, AND AGREES THAT IT WILL NOT ASSERT (WHETHER AS
PLAINTIFF, DEFENDANT OR OTHERWISE), ANY RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT OR OTHER LEGAL
PROCEEDING IN CONNECTION WITH OR RELATING TO THIS AGREEMENT OR ANY MATTER CONTEMPLATED HEREBY.

               Section 12.19 REIT Provisions.

               (a) The General Partner and the Partnership shall use commercially reasonable efforts to cause
the Partnership to operate as if it were subject to the real estate investment trust (“REIT”) rules
of the Code described below, except as otherwise permitted by prior written consent of the
Partners:

                    (i) the “75 percent gross income test” set forth in Section 856(c)(3) of the Code and the
"95 percent gross income test” set forth in Section 856(c)(2) of the Code; and

                    (ii) the gross assets tests set forth in Section 856(c) of the Code: (A) the “75 percent asset
test" set forth in Section 856(c)(4)(A) of the Code, (B) the “25 percent asset
test" set forth in Section 856(c)(4)(B)(i) of the Code, (C) the "20 percent
value limitation” set forth in Section 856(c)(4)(B)(ii) of the Code, (D) the “5 percent value
limitation” set forth in Section 856(c)(4)(B)(iii)(I) of the Code and (E) the “10 percent vote and
value limitations” set forth in Sections 856(c)(4)(B)(iii)(II) and (III) of the Code.

          For purposes of the foregoing tests, any “mezzanine” loans secured by an equity interest in an
entity and any interest therefrom shall not be treated as satisfying such tests unless such loans
and interest are in substantial compliance with the requirements of Revenue Procedure 2003-65,
except as otherwise permitted by prior written consent of the Partners.

               (b) The General Partner and the Partnership shall use commercially reasonable efforts to cause
the Partnership not to dispose of any real property in a transaction that would be treated as a
“prohibited transaction” within the meaning of Section

65

 

857(b)(6)(B)(iii) of the Code, unless (i) the transaction qualifies for the safe harbor, set
forth in Section 857(b)(6)(C) of the Code, applied to the Partnership as if the Partnership were
subject to Section 857(b)(6), taking into account any other “safe harbor” transactions engaged in
by the respective Partner in determining whether seven sales has occurred during the year,
including any such transactions engaged in by a joint venture, partnership or limited liability
company in which such Partner invests (which information such Partner will provide to the General
Partner and Partnership upon written request), (ii) the transaction is required under this
Agreement, (iii) the property is disposed of in connection with or in lieu of foreclosure, (iv) the
property is transferred in a tax free exchange under the Code, (v) the Partners consent or (vi) the
Executive Committee approves such transaction by a Supermajority Vote.

               (c) The General Partner and the Partnership shall use commercially reasonable efforts to cause
the Partnership to make distributions to the Partners in compliance with the “90% distribution
requirement” of Section 857(a)(1) of the Code, provided that the General Partner and the
Partnership shall not be in violation of this Section 12.19(c) if:

                    (i) the Partnership makes the distributions required by Articles 7 and 9 of this Agreement,
and

                    (ii) if the distributions required by Articles 7 and 9 of this Agreement are insufficient to
satisfy the 90% distribution requirement, the General Partner and Partnership shall

                         (A) notify the Partners of the insufficiency,

                         (B) (B) notify the Partners of whether the Partnership is fully leveraged to the extent
permitted by the debt ratio set forth in Section 3.8(a) of the Agreement (75%), and

                         (C) (C) (1) if the Partnership’s debt ratio is below the permitted threshold (75%), the
General Partner shall not be required to incur debt to make additional distributions unless a
Partner requests it, in which case the General Partner and the Partnership shall use commercially
reasonable efforts to cause the Partnership to incur additional debt on commercially reasonable
terms in order to make such additional distributions to the requesting Partner and (2) if the
Partnership’s debt ratio is at the maximum permitted (75%), the General Partner shall not be
required to incur debt to make additional distributions unless both LMLP and Inland consent, in
which case the General Partner and the Partnership shall use commercially reasonable efforts to
cause the Partnership to incur additional debt on commercially reasonable terms in order to make
such additional distributions to both Partners.

          If an amount otherwise available for distribution pursuant to Article 7 of the Agreement is
used to acquire an Approved Qualified Asset or fund a capital expenditure approved by a
Supermajority Vote of the Executive Committee or consented to by the distributee Partner, such
Partner’s share of such distribution shall be treated as distributed to the Partner for purposes of
satisfying this Section 12.19(c).

               (d) Without limiting the foregoing, the General Partner and the Partnership shall take such
other reasonable steps as shall be requested in writing in good faith

66

 

by each Partner and its ultimate Parent entity (Inland Real Estate Trust, Inc. in the case of
Inland and Lexington Realty Trust in the case of LMLP), which the requesting Partner and Parent
believe in good faith is necessary in order for the Parent (and, in the case of LMLP, LMLP) to
continue to qualify as a REIT (determined assuming that, without regard to its investment in the
Partnership, such ultimate Parent entity (or LMLP) otherwise would qualify as a REIT) and no other
reasonable steps or action could be taken by the requesting Partner or Parent (in lieu of the
Partnership taking any requested steps) to enable the Parent to so qualify.

               (e) Notwithstanding anything to the contrary in this Agreement, in no event shall the General
Partner or Partnership have any liability to a Partner or Affiliate with respect to its failure to
qualify as a REIT so long as the General Partner and Partnership have acted in good faith and used
commercially reasonable efforts to satisfy the obligations set forth in this Section 12.19.

[THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.]

67

 

          IN WITNESS WHEREOF, this Agreement is executed effective as of the date first set forth above.

	 	 	 	 	 	 	 
	 	 	LMLP GP	 	 
	 
	 	 	 	 	 	 
	 	 	LMLP GP LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Joseph S. Bonventre
 

	 	 
	 	 	Name: Joseph S. Bonventre	 	 
	 	 	Title: Senior Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	LMLP	 	 
	 
	 	 	 	 	 	 
	 	 	THE LEXINGTON MASTER LIMITED PARTNERSHIP	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	Lex GP-1 Trust, its general partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Joseph S. Bonventre	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Joseph S. Bonventre	 	 
	 	 	Title: Senior Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	INLAND	 	 
	 
	 	 	 	 	 	 
	 	 	INLAND AMERICAN (NET LEASE) SUB, LLC	 	 
	 

	 

	 	By:
	 	Inland American Real Estate Trust, Inc.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Lori Foust	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Lori Foust	 	 
	 	 	Title: Treasurer	 	 
	 
	 	 	 	 	 	 
	 	 	The undersigned hereby unconditionally and irrevocably guarantees the
obligations of Inland American (Net Lease) Sub, LLC under Sections 3.10(c),
3.11, 3.12 and 5.1:	 	 
	 
	 	 	 	 	 	 
	 	 	INLAND AMERICAN REAL ESTATE TRUST, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Lori Foust	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Lori Foust	 	 
	 	 	Title: Treasurer	 	 

68

 

SCHEDULE 1

Capital Commitment; Initial Capital Contribution; Percentage Interest

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	Remaining	 	 
	 	 	 	 	 	 	 	 	 	 	Qualified	 	 
	 	 	 	 	 	 	 	 	 	 	Assumed Assets	 	 
	 	 	Capital	 	Initial Capital	 	Capital	 	Percentage
	Partner Name	 	Commitment	 	Contribution	 	Contribution	 	Interest
	The Lexington Master Limited Partnership
	 	$	22,500,000.00	 	 	$	21,516,440.08	 	 	$	[                    ]	 	 	 	15.00	%
	LMLP GP LLC
	 	$	0.00	 	 	$	0.00	 	 	$	0.00	 	 	 	0.00	%
	Inland American (Net Lease) Sub, LLC
	 	$	127,500,000.00	 	 	$	121,926,493.79	 	 	$	[                    ]	 	 	 	85.00	%

Preferred Equity Capital Contribution

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Preferred Equity
	Partner Name	 	Tenant	 	Address	 	Capital Contribution
	 
	The Lexington Master 

Limited Partnership

	 	Advance PCS, Inc.
	 	2401 Cherahala Boulevard, Knoxville, Tennessee
	 	$	2,639,426	 
	 
	The Lexington Master 

Limited Partnership

	 	American Electric Power
	 	420 Riverport Road, Kingport, Tennessee
	 	$	2,632,074	 
	 
	The Lexington Master 

Limited Partnership

	 	American Golf

Corporation
	 	11411 N. Kelly Avenue, Oklahoma City, Oklahoma
	 	$	2,799,838	 
	 
	The Lexington Master 

Limited Partnership

	 	ASML Lithography

Holding NV
	 	8555 South River Parkway, Tempe, Arizona	 	$	—	 
	 
	The Lexington Master 

Limited Partnership

	 	AT&T Wireless Services,
Inc.
	 	3201 Quail Springs Parkway, Oklahoma City, Oklahoma
	 	$	393,154	 
	 
	The Lexington Master 

Limited Partnership

	 	Baker Hughes, Inc.
	 	9110 Grogans Mill Road, Houston, Texas
	 	$	—	 
	 
	The Lexington Master 

Limited Partnership

	 	Baker Hughes, Inc.
	 	2529 West Thorne Drive, Houston, Texas
	 	$	—	 
	 
	The Lexington Master 

Limited Partnership

	 	Bay Valley Foods, LLC
	 	2935 Van Vactor Way, Plymouth, Indiana
	 	$	442,985	 
	 
	The Lexington Master 

Limited Partnership

	 	Corning, Inc.
	 	736 Addison Road, Erwin, New York
	 	$	929,272	 
	 
	The Lexington Master 

Limited Partnership

	 	Cox Communications, Inc.
	 	1440 East 15th Street, Tucson, Arizona
	 	$	1,968,812	 
	 
	The Lexington Master 

Limited Partnership

	 	Dana Corporation
	 	6938 Elm Valley Drive, Kalamazoo, Michigan
	 	$	—	 
	 
	The Lexington Master

	 	EDS Information Services,

LLC (Electronic Data
	 	3600 Army Post Road, Des Moines, Iowa
	 	$	2,811,473	 

Schedule 1-1

 

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Preferred Equity
	Partner Name	 	Tenant	 	Address	 	Capital Contribution
	 
	Limited Partnership

	 	Systems Corporation)	 	 	 	 	 	 
	 
	The Lexington Master 

Limited Partnership

	 	Entergy Services, Inc.
	 	5201 W. Barraque Street, Pine Bluff, Arkansas
	 	$	1,633,393	 
	 
	The Lexington Master 

Limited Partnership

	 	Georgia Power Company
	 	2500 Patrick Henry Parkway, McDonough, Georgia
	 	$	788,468	 
	 
	The Lexington Master 

Limited Partnership

	 	Honeywell, Inc.
	 	19019 N. 59th Avenue, Glendale, Arizona
	 	$	—	 
	 
	The Lexington Master 

Limited Partnership

	 	Ivensys Systems, Inc.

(Siebe, Inc.)
	 	70 Mechanic Street, Foxboro, Massachusetts
	 	$	—	 
	 
	The Lexington Master 

Limited Partnership

	 	Kelsey Hayes Company

(TRW Automotive)
	 	1200 & 12025 Tech Center Drive, Livonia, Michigan
	 	$	6,202,234	 
	 
	The Lexington Master 

Limited Partnership

	 	Kelsey-Seybold Clinic
(St. Lukes Episcopal
Health System)
	 	11555 University Boulevard, Houston, Texas
	 	$	—	 
	 
	The Lexington Master 

Limited Partnership

	 	Lithia Motors
	 	101 Creger, Fort Collins, Colorado
	 	$	1,990,894	 
	 
	The Lexington Master 

Limited Partnership

	 	Litton Loan Servicing
L.P.
(Credit-Based Asset
Servicing and
Securitization LLC)
	 	3500 North Loop Court, McDonough, Georgia
	 	$	9,333,584	 
	 
	The Lexington Master 

Limited Partnership

	 	Montgomery County

Management, LLC
	 	17191 St. Lukes Way, Woodlands, Texas
	 	$	353,061	 
	 
	The Lexington Master 

Limited Partnership

	 	Nextel of Texas
	 	1600 Eberhardt Road, Temple, Texas
	 	$	4,209,577	 
	 
	The Lexington Master 

Limited Partnership

	 	Nextel West Corporation
	 	6455 State Highway 303 N.E., Bremerton, Washington
	 	$	3,399,973	 
	 
	The Lexington Master 

Limited Partnership

	 	Northrop Grumman 

Systems Corp.
	 	3943 Denny Avenue, Pascagoula, Mississippi
	 	$	4,909,261	 
	 
	The Lexington Master 

Limited Partnership

	 	Omnipoint Holdings, Inc.

(T-Mobile USA, Inc.)
	 	133 First Park Drive, Oakland, Maine
	 	$	1,042,339	 
	 
	The Lexington Master 

Limited Partnership

	 	Owens Corning
	 	590 Ecology Lane, Chester, South Carolina
	 	$	6,949,242	 
	 
	The Lexington Master 

Limited Partnership

	 	Owens Corning
	 	1901 49th Avenue, Minneapolis, Minnesota
	 	$	4,960,221	 
	 
	The Lexington Master 

Limited Partnership

	 	Parkway Chevrolet, Inc.
	 	25500 SH 249, Tomball, Texas
	 	$	1,394,239	 
	 
	The Lexington Master 

Limited Partnership

	 	Raytheon Company
	 	1200 Jupiter Road, Garland, Texas
	 	$	—	 
	 
	The Lexington Master 

Limited Partnership

	 	Seimens Dematic Postal

Automation
	 	1404-1501 Nolan Ryan Parkway, Arlington, Texas
	 	$	—	 
	 
	The Lexington Master 

Limited Partnership

	 	Silver Spring Gardens, Inc.
(Huntsinger Farms, Inc.)
	 	2424 Alpine Road, Eau Claire, Wisconsin
	 	$	8,419,695	 

 

 

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Preferred Equity
	Partner Name	 	Tenant	 	Address	 	Capital Contribution
	 
	The Lexington Master 

Limited Partnership

	 	SKF USA Inc.
	 	324 Industrial Park Road, Franklin, North Carolina
	 	$	1,930,711	 
	 
	The Lexington Master 

Limited Partnership

	 	Tenneco Automotive
Operation Company
(Tenneco Automotive Inc.)
	 	904 Industrial Road, Marshall, Michigan
	 	$	—	 
	 
	The Lexington Master 

Limited Partnership

	 	TI Group Automotive

Systems, LLC (TI

Automotive LTD)
	 	359 Gateway Drive, Livonia, Georgia
	 	$	629,591	 
	 
	The Lexington Master 

Limited Partnership

	 	Time Customer Service,
Inc. (Time, Inc.)
	 	10419 North 30th Street, Tampa, Florida
	 	$	—	 
	 
	The Lexington Master 

Limited Partnership

	 	TRW, Inc. (Experian
Information Solutions,
Inc.)
	 	601 & 701 Experian Parkway, Allen, Texas
	 	$	—	 
	 
	The Lexington Master 

Limited Partnership

	 	Unisource Worldwide, Inc.
	 	109 Stevens Street, Jacksonville, Florida
	 	$	5,297,120	 
	 
	The Lexington Master 

Limited Partnership

	 	United Technologies Corp.
	 	120 S.E. Parkway Drive, Franklin, Tennessee
	 	$	—	 
	 
	The Lexington Master 

Limited Partnership

	 	Voicestream PCS I
(T-Mobile USA, Inc.)
	 	2999 S.W. 6th Street, Redmond, Oregon
	 	$	3,507,105	 
	 
	The Lexington Master 

Limited Partnership

	 	Voicestream PCS II
(T-Mobile USA, Inc.)
	 	9601 Renner Boulevard, Lenexa, Kansas
	 	$	1,247,249	 
	 
	The Lexington Master 

Limited Partnership

	 	Voicestream PCS II
(T-Mobile USA, Inc.)
	 	3265 East Goldstone Drive, Meridian, Idaho
	 	$	1,119,875	 
	 
	The Lexington Master 

Limited Partnership

	 	Voicestream PCS II
(T-Mobile USA, Inc.)
	 	3711 San Gabrial, Mission, Texas
	 	$	1,425,877	 
	 
	The Lexington Master 

Limited Partnership

	 	Wachovia Bank, N.A.
	 	265 Lehigh Street, Allentown, Pennsylvania
	 	$	2,254,111	 

Qualified Contribution Assets

     Property (defined in Contribution Agreement)

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Existing	 	 
	 	 	 	 	 	 	Indebtedness at	 	Contributed Asset (defined
	 	 	Primary Tenant	 	Address	 	Contribution	 	in Contribution Agreement)
	 
	Fee interest

	 	Advance PCS, Inc.
	 	2401 Cherahala Boulevard,

Knoxville, Tennessee
	 	$	5,022,910	 	 	100% membership

interest in

Lexington Knoxville

Manager LLC
	 
	Fee Interest

	 	American Electric Power
	 	420 Riverport Road, Kingport,

Tennessee
	 	 	—	 	 	Fee Interest
	 
	Leasehold 

interest

	 	ASML Lithography

Holding NV
	 	8555 South River Parkway, Tempe,

Arizona	 	$	—	 	 	100% membership
interest in
Lexington Tempe
Manager LLC and
100% limited
partnership
interest

 

 

     Property (defined in Contribution Agreement)

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Existing	 	 
	 	 	 	 	 	 	Indebtedness at	 	Contributed Asset (defined
	 	 	Primary Tenant	 	Address	 	Contribution	 	in Contribution Agreement)
	 
	 

	 	 	 	 	 	 	 	 	 	in Lexington Tempe L.P.
	 
	Fee interest

	 	Baker Hughes, Inc.
	 	2529 West Thorne Drive, Houston,

Texas
	 	$	—	 	 	100% membership
interest in NLSAF
BHI Train GP LLC
(after transfer of
general partner
interest in Texan
Training Limited
Partnership from
Lexington BHI
Trust) and 99.5%
limited partnership
interest in Texan
Training Limited
Partnership
	 
	Fee interest

	 	Dana Corporation
	 	6938 Elm Valley Drive, Kalamazoo,

Michigan
	 	$	—	 	 	100% membership
interest in
Lexington Kalamazoo
Manager LLC and
100% limited
partnership
interest in
Lexington Kalamazoo
L.P.
	 
	Fee interest

	 	EDS Information

Services, LLC

(Electronic Data

Systems Corporation)
	 	3600 Army Post Road, 
Des Moines,

Iowa
	 	$	22,761,297	 	 	100% membership
interest in
Lexington TNI Des
Moines Manager LLC
and 100% limited
partnership
interest in
Lexington TNI Des
Moines L.P.
	 
	Fee Interest

	 	Entergy Services, Inc.
	 	5201 W. Barraque Street, Pine
Bluff, Arkansas
	 	 	—	 	 	Fee Interest
	 
	Fee interest

	 	Honeywell, Inc.
	 	19019 N. 59th Avenue, Glendale,
Arizona
	 	$	—	 	 	100% interest in

Lexington Manager

Glendale LLC
	 
	Fee Interest

	 	Lithia Motors
	 	101 Creger, Fort Collins, Colorado
	 	 	—	 	 	Fee Interest
	 
	Fee interest

	 	Owens Corning
	 	590 Ecology Lane, Chester, South

Carolina
	 	$	13,055,864	 	 	100% interest in a
to be formed SP
Subsidiary and 100%
interest in
Lexington Chester
Industrial LLC
	 
	Fee Interest (to be 

acquired)

	 	Raytheon Company
	 	1200 Jupiter Road, Garland, Texas
	 	 	—	 	 	100% interest in
NLSAF Garland L.P.
(to be formed)
	 
	Leasehold interest

	 	TI Group Automotive

Systems, LLC (TI

Automotive LTD)
	 	359 Gateway Drive, Livonia,

Georgia
	 	$	9,715,415	 	 	100% membership
interest in
Lexington Livonia
TI Manager LLC and
100% limited
partnership
interest in
Lexington Livonia
TI L.P.
	 
	Fee interest

	 	Unisource Worldwide,
Inc.
	 	109 Stevens Street, Jacksonville,

Florida
	 	—
	 	 	Fee interest
	 
	Ground Lease

	 	United Technologies
	 	120 S.E. Parkway Drive, Franklin,
	 	—	 	 	 

 

 

     Property (defined in Contribution Agreement)

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Existing	 	 
	 	 	 	 	 	 	Indebtedness at	 	Contributed Asset (defined
	 	 	Primary Tenant	 	Address	 	Contribution	 	in Contribution Agreement)
	 
	 

	 	Corp.
	 	Tennessee	 	 	 	 	 	 
	 
	Fee interest

	 	Voicestream PCS II
(T-Mobile USA, Inc.)
	 	3265 East Goldstone Drive,

Meridian, Idaho
	 	$	10,033,141	 	 	100% membership

interest in

Acquiport Meridian

Manager LLC
	 
	Fee interest

	 	Voicestream PCS II
(T-Mobile USA, Inc.)
	 	3711 San Gabrial, Mission, Texas
	 	$	6,251,476	 	 	100% membership
interest in
Lexington Mission
Manager LLC and
99.5% limited
partnership
interest in
Lexington Mission
L.P.
	 
	Fee Interest

	 	Wachovia Bank, N.A.
	 	265 Lehigh Street, Allentown,

Pennsylvania
	 	—
	 	 	 

 

 

SCHEDULE 2

Acquisition Parameters

               Required Parameters

	 	•	 	Single tenant, net leased, commercial real estate properties in the office, retail and
industrial sectors.
	 
	 	•	 	Real estate properties that have a specialized use, design or other feature providing for
higher initial capitalization rates than those of more conventional net leased assets.
	 
	 	•	 	Not less than $15,000,000 nor greater than $75,000,000 in total acquisition costs.
	 
	 	•	 	Real estate properties that are fully occupied and rent bearing at purchase.
	 
	 	•	 	Tenants are solvent.
	 
	 	•	 	Real estate properties that have strategic value and/or are mission critical to tenant’s
business.

Schedule 2-1

 

SCHEDULE 2.8

Qualified Sale Assets

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Existing	 	 	 	 
	 	 	 	 	 	 	Indebtedness at	 	Sold Assets (defined in Purchase	 	 
	 	 	Primary Tenant	 	Address	 	Sale	 	Agreement)	 	LMLP Sale Affiliate
	 
	40% tenancy-in-common
	 	 	 	 	 	 	 	100% membership interest in	 	Lexington TIC OK
	interest
	 	 	 	 	 	 	 	Lexington Oklahoma City Manager	 	Holdings L.P.
	 
	 	 	 	 	 	$5,889,549	 	LLC and 100% limited	 	 
	 
	 	AT&T Wireless	 	3201 Quail Springs Parkway,	 	(proportionate	 	partnership interest in	 	 
	 
	 	Services, Inc.	 	Oklahoma City, Oklahoma	 	share)	 	Lexington Oklahoma City L.P.	 	 
	 
	Fee interest
	 	 	 	 	 	           
    —	 	100% membership interest in	 	LSAC Operating
	 
	 	 	 	 	 	 	 	LSAC Oklahoma City Manager LLC	 	Partnership L.P.
	 
	 	American Golf	 	11411 N. Kelly Avenue,	 	 	 	and 100 limited partnership	 	 
	 
	 	Corporation	 	Oklahoma City, Oklahoma	 	 	 	interest in LSAC Oklahoma L.P.	 	 
	 
	Fee interest
	 	 	 	 	 	$         
    —	 	100% membership interest in	 	Lexington Realty Trust
	 
	 	 	 	 	 	 	 	NLSAF BHI Christen GP LLC	 	 
	 
	 	 	 	 	 	 	 	(after transfer of general	 	 
	 
	 	 	 	 	 	 	 	partner interest in Texan	 	 
	 
	 	 	 	 	 	 	 	Christen Limited Partnership	 	 
	 
	 	 	 	 	 	 	 	from Lexington BHI Trust) and	 	 
	 
	 	 	 	 	 	 	 	99.5% limited partnership	 	 
	 
	 	 	 	9110 Grogans Mill Road,	 	 	 	interest in Texan Christensen	 	 
	 
	 	Baker Hughes, Inc.	 	Houston, Texas	 	 	 	Limited Partnership	 	 
	 
	Fee interest
	 	 	 	 	 	$6,584,860	 	100% membership interest in	 	LSAC Operating
	 
	 	 	 	 	 	 	 	LSAC Plymouth Manager LLC and	 	Partnership L.P.
	 
	 	Bay Valley Foods,	 	2935 Van Vactor Way,	 	 	 	100% limited partnership	 	 
	 
	 	LLC	 	Plymouth, Indiana	 	 	 	interest in LSAC Plymouth L.P.	 	 
	 
	Fee interest
	 	 	 	 	 	$9,299,052	 	100% membership interest in	 	Triple Net Investment
	 
	 	 	 	 	 	 	 	Lexington TNI Erwin Manager LLC	 	Company LLC
	 
	 	 	 	 	 	 	 	and 100% limited partnership	 	 
	 
	 	 	 	736 Addison Road, Erwin,	 	 	 	interest in Lexington TNI Erwin	 	 
	 
	 	Corning, Inc.	 	New York	 	 	 	L.P.	 	 
	 
	Fee interest
	 	Cox Communications,	 	1440 East
15th Street,	 	$2,257,957	 	100% membership interest in Net	 	Net 3 Acquisition  L.P.
	 
	 	Inc.	 	Tucson, Arizona	 	 	 	2 Cox LLC	 	 

Schedule 2.8-1

 

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Existing	 	 	 	 
	 	 	 	 	 	 	Indebtedness at	 	Sold Assets (defined in Purchase	 	 
	 	 	Primary Tenant	 	Address	 	Sale	 	Agreement)	 	LMLP Sale Affiliate
	 
	Fee interest
	 	 	 	 	 	$12,675,000	 	100% membership interest in	 	Lexington Acquiport
	 
	 	 	 	 	 	 	 	Acquiport McDonough Manager LLC	 	Company II, LLC
	 
	 	 	 	 	 	 	 	and 100% limited partnership	 	 
	 
	 	Georgia Power	 	2500 Patrick Henry Parkway,	 	 	 	interest in Acquiport McDonough	 	 
	 
	 	Company	 	McDonough, Georgia	 	 	 	L.P.	 	 
	 
	Fee interest
	 	Ivensys Systems,	 	70 Mechanic Street,	 	 	 	 	 	Lepercq Corporate
	 
	 	Inc. (Siebe, Inc.)	 	Foxboro, Massachusetts	 	$         
    —	 	Fee interest	 	Income Fund L.P.
	 
	Fee interest
	 	Kelsey Hayes	 	 	 	 	 	 	 	 
	 
	 	Company (TRW	 	1200 & 12025 Tech Center	 	$10,467,458	 	100% interest in Lexington	 	Lepercq Corporate
	 
	 	Automotive)	 	Drive, Livonia, Michigan	 	 	 	Livonia L.L.C.	 	Income Fund L.P.
	 
	Fee interest
	 	 	 	 	 	$         
    —	 	100% membership interest in	 	Westport View
	 
	 	Kelsey-Seybold	 	 	 	 	 	Lexington Sugarland Manager LLC	 	Corporate Center L.P.
	 
	 	Clinic (St. Lukes	 	 	 	 	 	and 100% limited partnership	 	 
	 
	 	Episcopal Health	 	11555 University Boulevard,	 	 	 	interest in Lexington Sugarland	 	 
	 
	 	System)	 	Houston, Texas	 	 	 	L.P.	 	 
	 
	Fee interest
	 	 	 	 	 	$ 7,500,000	 	100% membership interest in	 	LSAC Operating
	 
	 	 	 	 	 	 	 	LSAC Woodlands Manager LLC and	 	Partnership L.P.
	 
	 	Montgomery County	 	17191 St. Lukes Way,	 	 	 	100% limited partnership	 	 
	 
	 	Management, LLC	 	Woodlands, Texas	 	 	 	interest in LSAC Woodlands L.P.	 	 
	 
	Fee interest
	 	 	 	 	 	$ 8,757,807	 	100% membership interest in	 	Lexington Realty Trust
	 
	 	 	 	 	 	 	 	Lexington Temple Manager LLC	 	 
	 
	 	 	 	 	 	 	 	(current Lexington Temple	 	 
	 
	 	 	 	 	 	 	 	Trust) and 99% limited	 	 
	 
	 	 	 	1600 Eberhardt Road,	 	 	 	partnership interest in	 	 
	 
	 	Nextel of Texas	 	Temple, Texas	 	 	 	Lexington Temple L.P.	 	 
	 
	Fee interest
	 	Nextel West	 	6455 State Highway 303 N.E.,	 	$ 6,473,162	 	100% membership interest in 	 	Lexington Realty Trust
	 
	 	Corporation	 	Bremerton, Washington	 	 	 	Lexington Bremerton Manager LLC	 	 
	 
	Fee interest
	 	 	 	 	 	            
    —	 	100% membership interest in	 	LSAC Operating
	 
	 	 	 	 	 	 	 	LSAC Pascagoula Manager LLC and	 	Partnership L.P.
	 
	 	 	 	 	 	 	 	100% limited partnership	 	 
	 
	 	Northrop Grumman	 	3943 Denny Avenue,	 	 	 	interest in LSAC Pascagoula	 	 
	 
	 	Systems Corp.	 	Pascagoula, Mississippi	 	 	 	L.P.	 	 
	 
	Fee interest
	 	 	 	 	 	$10,226,839	 	100% membership interest in	 	Lexington Acquiport
	 
	 	 	 	 	 	 	 	Acquiport Oakland Manager LLC	 	Company II, LLC
	 
	 	Omnipoint Holdings,	 	 	 	 	 	and 100% limited partnership	 	 
	 
	 	Inc. (T-Mobile USA,	 	133 First Park Drive,	 	 	 	interest in Acquiport Oakland	 	 
	 
	 	Inc.)	 	Oakland, Maine	 	 	 	L.P.	 	 

Schedule 2.8-2

 

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Existing	 	 	 	 
	 	 	 	 	 	 	Indebtedness at	 	Sold Assets (defined in Purchase	 	 
	 	 	Primary Tenant	 	Address	 	Sale	 	Agreement)	 	LMLP Sale Affiliate
	 
	Fee interest
	 	 	 	1901 49th	 	 	 	 	 	 
	 
	 	 	 	Avenue, Minneapolis,	 	             
    —	 	100% membership interest in	 	Lepercq Corporate
	 
	 	Owens Corning	 	Minnesota	 	 	 	Lexington Minneapolis L.L.C.	 	Income Fund L.P.
	 
	Fee interest
	 	 	 	 	 	$  9,308,850	 	100% membership interest in	 	LSAC Operating
	 
	 	 	 	 	 	 	 	LSAC Tomball Manager LLC and	 	Partnership L.P.
	 
	 	Parkway Chevrolet,	 	 	 	 	 	100% limited partnership	 	 
	 
	 	Inc.	 	25500 SH 249, Tomball, Texas	 	 	 	interest in LSAC Tomball L.P.	 	 
	 
	Fee interest
	 	 	 	 	 	$            
    —	 	100% membership interest in	 	Lexington Acquiport
	 
	 	 	 	 	 	 	 	Lexington Arlington Manager LLC	 	Company II, LLC
	 
	 	 	 	 	 	 	 	and 99.5% limited partnership	 	 
	 
	 	Seimens Dematic	 	1404-1501 Nolan Ryan	 	 	 	interest in Lexington Arlington	 	 
	 
	 	Postal Automation	 	Parkway, Arlington, Texas	 	 	 	L.P.	 	 
	 
	Fee interest
	 	 	 	 	 	             
    —	 	100% membership interest in	 	LSAC Operating
	 
	 	Silver Spring	 	 	 	 	 	LSAC Eau Claire Manager LLC and	 	Partnership L.P.
	 
	 	Gardens, Inc.	 	 	 	 	 	100% limited partnership	 	 
	 
	 	(Huntsinger Farms,	 	2424 Alpine Road, Eau	 	 	 	interest in LSAC Eau Claire	 	 
	 
	 	Inc.)	 	Claire, Wisconsin	 	 	 	L.P.	 	 
	 
	 
	 	 	 	324 Industrial Park Road,	 	 	 	 	 	 
	Fee interest
	 	SKF USA Inc.	 	Franklin, North Carolina	 	$  1,472,638	 	Fee interest	 	Lexington Realty Trust
	 
	Fee interest
	 	Tenneco Automotive	 	 	 	 	 	 	 	 
	 
	 	Operation Company	 	 	 	 	 	 	 	 
	 
	 	(Tenneco Automotive	 	904 Industrial Road,	 	 	 	 	 	 
	 
	 	Inc.)	 	Marshall, Michigan                -	 	              
    —	 	Fee interest	 	LXP I, L.P.
	 
	Fee interest
	 	Time Customer	 	 	 	 	 	 	 	 
	 
	 	Service, Inc.	 	10419 North 30th	 	 	 	 	 	 
	 
	 	(Time, Inc.)	 	Street, Tampa, Florida	 	$            
    —	 	Fee interest	 	North Tampa Associates
	 
	 
	 	 	 	 	 	 	 	100% membership interest in	 	 
	 
	 	 	 	 	 	 	 	Lexington Allen Manager LLC and	 	 
	 
	Fee interest
	 	TRW, Inc. (Experian	 	 	 	$            
    —	 	100% limited partnership	 	Lexington Texas
	 
	 	Information	 	601 & 701 Experian Parkway,	 	 	 	interest in Lexington Allen	 	Holdings L.P.
	 
	 	Solutions, Inc.)	 	Allen, Texas	 	 	 	L.P.	 	 
	 
	Fee interest
	 	Voicestream PCS I	 	 	 	 	 	 	 	 
	 
	 	(T-Mobile USA,	 	2999 S.W. 6th	 	$  9,605,384	 	100% membership interest in	 	Lepercq Corporate
	 
	 	Inc.)	 	Street, Redmond, Oregon	 	 	 	Lexington Redmond Manager LLC	 	Income Fund II L.P.
	 
	Fee interest
	 	Voicestream PCS II	 	 	 	 	 	 	 	 
	 
	 	(T-Mobile USA,	 	9601 Renner Boulevard,	 	$10,098,936	 	100% membership interest in	 	Lexington Acquiport
	 
	 	Inc.)	 	Lenexa, Kansas	 	 	 	Acquiport Lenexa Manager LLC	 	Company II, LLC
	 
	Fee interest
	 	Litton Loan	 	 	 	 	 	100% membership interest in	 	Lexington Realty Trust
	(currently under
	 	Servicing L.P.	 	 	 	 	 	NLSAF McDonough Manager LLC and	 	 
	contract)
	 	(Credit-Based Asset	 	 	 	 	 	100% limited partnership	 	 
	 
	 	Servicing and	 	3500 North Loop Court,	 	 	 	interest in NLSAF McDonough	 	 
	 
	 	Securitization LLC)	 	McDonough, Georgia	 	             
    —	 	L.P.	 	 

     Property ( defined in Purchase Agreement)

Schedule 2.8-3

 

SCHEDULE 3.5

[Intentionally omitted from filing]

 

 

SCHEDULE 3.9

LMLP Existing Joint Venture Exclusivity Terms

Lex-Win Acquisition LLC — exclusive vehicle through which LMLP and its Affiliates will
enter into any transaction or acquire directly or indirectly, any shares of common stock of Wells
Real Estate Investment Trust, Inc. (“Wells”), any interest in Wells or any asset owned by Wells.

Schedule 3.9-1

 

SCHEDULE 4.7

INSURANCE REQUIREMENTS

EXHIBIT C

INSURANCE REQUIREMENTS

     The Partnership shall, at a minimum, obtain and maintain, and/or cause the SP Subsidiaries to
obtain and maintain, without interruption, the insurance coverages stipulated hereunder for the
benefit of the Partnership and each Partner thereof, but only to the extent of such party’s
interest in each Qualified Asset:

     (a) Property and Related Insurance.

          (i) Qualified Assets. At all times following commencement of construction of any above-ground
improvements thereon, each Qualified Asset shall be insured on a 100% Full Replacement Cost basis.
Full Replacement Cost is defined as the cost of replacing the improvements, together with
appurtenances and betterments in compliance with prevailing building codes, without deduction for
physical depreciation thereof, at the time of replacement of the Qualified Asset, following a loss.
The value so determined shall be binding and conclusive. The policy shall further provide that,
in the event of a total or constructive total loss, the Partnership or SP Subsidiary shall not be
unreasonably restricted from applying the proceeds to the re-building of the improvements at such
other location as the Partnership shall elect. At all times following commencement of construction
of any vertical improvements thereon, Qualified Assets shall be insured against physical loss or
damage by fire, lightning and other risks and supplementary perils from time to time included under
Special Form policies including, vandalism and malicious mischief (with agreed amount
endorsements), windstorm, earthquake, and certified and non-certified acts of terrorism. The
policy shall be endorsed to provide coverage for demolition and increased cost of construction to
conform to local ordinance, and will include “extra expense” and “expediting expense” coverage.

          (ii) Rent Loss/Business Interruption. The Partnership shall maintain, after substantial
completion of any above-ground improvements, rent loss/business interruption insurance sufficient
to prevent the Partnership or the SP Subsidiary from being a coinsurer under the terms of the
policy, and in an amount equal to twelve months’ projected gross income from the Qualified Asset.
The policy must contain an extended period of indemnity endorsement which provides that after the
loss to the Improvements and personal property has been repaired, the continued loss of income will
be insured until the earlier of such time that such income returns to the same level it was prior
to the loss or the expiration of six (6) months from the date of restoration. This requirement
shall apply in the event the Partnership, by upon approval of the Executive Committee by a
Supermajority vote,, has elected to offer all or any portion of the Qualified Asset for rent
pursuant to leases or other occupancy agreements.

          (iii) Boiler and Machinery. The Partnership or the SP Subsidiary shall maintain, after
substantial completion of any above-ground improvements, boiler and machinery insurance covering
physical damage to the Qualified Asset and to the major components of any central heating, air
conditioning or ventilation systems, and such other equipment as is usual for similar properties in
the area. The policy shall include coverage for business interruption, including expediting and
extra expense, in an amount not less than $500,000. Unless the insurance required in subsections
(a) (i), (iii) and (iv) is provided on the same policy or by the same insurance carrier, a Joint
Loss Agreement between separate primary policies will be required.

Schedule 4.7-1

 

          (iv) Builder’s Risk. During the period of any construction, repair, renovation, restoration
or replacement of the improvements or the Qualified Asset, the Partnership shall obtain and
maintain or cause to be obtained and maintained a completed value “All Risk” Builder’s Risk policy
in an amount equal to one hundred percent (100%) of the replacement cost of the Qualified Asset.
Coverage should include, but not be limited to, collapse, soft costs, transit, earthquake, flood,
windstorm, terrorism, off-site storage, expediting expenses, demolition and increased cost of
construction (for renovation and/or additions to existing structures), water damage, permission for
partial occupancy, and automatic reinstatement. The policy is to be in an amount not less than the
total value of the Qualified Asset (less the value of such uninsurable items as land, site
preparation, grading, paving, parking lots). The coverage may be provided as an extension to the
property policy in force if the requirements herein are satisfied, subject to approval by the
Partners of the Partnership. The Partnership shall cause the contracts with any contractors to
provide that (i) such contractor will be responsible for claims arising out of such contractor’s
negligence, and (ii) except to the extent that such contractor’s tools and equipment will become
part of the job, such tools and equipment shall not be considered insurable items.

          (v) Flood. If the Qualified Asset is located in a federally designated flood zone A or V and
flood insurance has been made available under the National Flood Insurance Act of 1968, flood
insurance is required in an amount equal to maximum coverage available, replacement cost, or such
amount as a mortgage lender may require.

          (vi) Earthquake. If a Qualified Asset is in an area identified by any governmental,
engineering or any hazard underwriting agencies as being subject to the peril of earthquake, and
the project is in a high-risk seismic area denoted as Zones 3 and 4 under the Uniform Building Code
(UBC), appropriate earthquake insurance coverage as required by lender is required.

     (b) Liability.

          (i) The Partnership and the SP Subsidiaries shall obtain and maintain Commercial General
Liability insurance on the broadest forms available for similar risks, written on an “occurrence
policy form,” against all claims for bodily injury, disease or death, property damage, personal
injury, certified and non-certified acts of terrorism products and completed operations, and
contractual liability (deleting any exclusion restricting coverage for contractual obligations for
claims occurring on, in or about the Qualified Asset and adjoining premises, and for explosion,
collapse, and underground property damage) in an amount of not less than $5,000,000 arising out of
any one occurrence; provided, however that coverage for explosion, collapse, and underground
property damage shall not be required until such time as any excavation at the Qualified Asset
commences, and may be in the form of coverage carried by the applicable contractor. Such insurance
may be provided under a primary and an umbrella policy or policies, provided that such umbrella
policy or policies shall not exclude “real estate activities.” If liability coverage for any
Qualified Asset procured by the contractor is included under any blanket policy written on an
aggregate form, then the annual aggregate limit of insurance must apply per location. The policy
shall be endorsed to include the SP Subsidiary, the Partnership, the lender and each Partner
thereof as an additional insured subject to the benefits stipulated under subsection (i)(iv)
hereof. Such insurance will be endorsed as primary and non-contributory with any other insurance
available to the SP Subsidiary, the Partnership, the lender and each Partner.

          (ii) During any period of construction, repair, restoration, renovation or replacement of the
Qualified Asset, the Partnership shall cause the general contractor to maintain commercial
liability insurance (or the Partnership’s or SP Subsidiary’s and Contractor’s protective liability
insurance in the name of the Partnership or SP Subsidiary and each Partner thereof), with extension
for, but not limited to, products/completed operations, with limits of not less than $10,000,000
per occurrence. Completed Operations insurance shall remain in effect for the length of time
statutorily required in the state in which

Sched. 4.7-2

 

the construction occurs. This coverage shall be maintained as was agreed to at the time of
substantial completion of the Qualified Asset and shall be for the same limits as required above.
The Partnership shall also cause the general contractor to require its subcontractors of any tier
to provide confirmation of commercial liability coverage (including products/completed operations),
and such insurance shall be on a primary and non-contributory basis with a limit of not less than
$1,000,000 per Qualified Asset. The general contractors and the subcontractors shall have the
Partnership and the SP Subsidiary included on the insurance required herein as additional insureds.

     (c) Worker’s Compensation. The Partnership and the SP Subsidiaries will maintain Worker’s
Compensation as statutorily required and Employer’s Liability insurance, or their equivalent, for
all of their respective employees, and will cause any of their agents, contractors and
subcontractors of any tier to maintain similar insurance for all their respective employees, to the
fullest extent required under the laws of the jurisdiction in which a Qualified Asset is located.

     (d) Errors and Omission. The Partnership will cause any professional consultants, including,
but not limited to, architects and engineers, to maintain coverage in limits of not less than
$1,000,000.

     (e) Crime. The Partnership will maintain crime insurance in an amount of not less than
$1,000,000 for the benefit of the Partnership and each Partner thereof against loss caused by
infidelity of its officers, agents, servants and employees; and against robbery or burglary both on
and off premises.

     (f) Other Insurance. In addition to the above, the Partnership and the SP Subsidiaries shall
maintain all insurance, surety and fidelity bonds in amounts and for such periods that are deemed
to be prudent, or are customarily maintained by persons or entities operating properties of like
kind, construction and occupancy in the locality of each Qualified Asset. Compliance with
insurance requirements will not in itself be construed to be a limitation of the Partnership’s or
the SP Subsidiaries’ liability.

     (g) All Insurance. All insurance required herein will be primary and not excess over,
contributory or participating with any other insurance carried by individual Partners of the
Partnership or their respective affiliates or agents.

     (h) Other Requirements With Respect to Insurance. The following provisions shall apply with
respect to all insurance coverage required above:

          (i) Insurance Companies: All insurance required herein shall be issued by insurance companies
of recognized good standing, with a rating of at least A-VII in Best’s Key Rating Guide, except for
loans in excess of $35,000,000 where required by lender and in in such case a rating of at lease
AVII in Best’s Key Rating Guide, and must be licensed to do business in the state in which the
Qualified Asset is located or must otherwise be acceptable to the Partnership. Insurance ratings
are subject to the approval of mortgagee. Coverage under blanket policies may be extended by
endorsements provided the insurers meet the requirements stipulated herein. Each policy shall not
have more than a $25,000 deductible for any occurrence, except for mandatory deductibles where
required under local regulations, or when required by insurers for specific catastrophic perils, or
with respect to flood insurance pursuant to Section (a)(v) which deductible shall not exceed
$250,000 for any occurrence. An allowance for deductibles in excess of $25,000 on all-risk policies
will be allowed upon the approval of mortgagee, but in any event cannot exceed $100,000.

          (ii) Evidence of Insurance: The Partnership or the SP Subsidiaries shall obtain, before the
expiration date of each such policy, original policies (or renewals or extensions of the insurance
afforded thereby) or certified duplicates thereof, or binders evidencing such insurance, or

Sched. 4.7-3

 

endorsements, or certificates thereof. Evidence of Property insurance shall be on ACORD 28
forms acceptable to lenders and naming lender as mortgagee and loss payee. Certificates of General
Liability shall be on ACORD 25 forms and shall name lender as additional insured.

          (iii) Insurance (Cut-Through Endorsement). Except to the extent prohibited by applicable law,
insurance placed with a non-admitted insurer or excess and surplus lines insurer will (upon written
request of the Partners) require a “cut-through” endorsement for reinsurance purposes to allow for
recovery directly from a reinsurer in the event of the primary insurer’s insolvency or cessation of
insurance operations. This will be addressed on a case by case basis, dependent on the insurance
carriers involved.

          (iv) Cancellation: The Partnership shall immediately notify each Partner of the Partnership
of any cancellation of, non-renewal, or such material change as may adversely affect any insurance
policy or coverage in force. Each policy shall contain a provision obligating the insurer to send
at least thirty (30) days’ prior written notice to any party included as an additional insured or
loss payee notifying them of the intent to cancel or make such change, and that any loss otherwise
payable to them thereunder shall be paid notwithstanding any act or negligence on their part or
that of the Partnership which might, absent such provision, result in a forfeiture of all or part
of such insurance payment.

          (v) Separate Insurance: Without the prior written consent of all Partners of the Partnership,
neither the Partnership not any SP Subsidiary shall purchase separate insurance concurrent in form
or contributing in the event of loss, with the insurance required hereunder.

          (vi) Payment of Premium. The Partnership or the applicable SP Subsidiary shall be solely
responsible for, and promptly pay when due, any and all premiums on all such insurance.

Sched. 4.7-4

 

EXHIBIT A

Form of Annual Budget

[Intentionally omitted from filing]

Exhibit A-1

 

EXHIBIT B

Contribution Agreement

[Intentionally omitted from filing]

Exhibit B-1

 

EXHIBIT C

Management Agreement

[Intentionally omitted from filing]

Exhibit C-2

 

EXHIBIT D

Purchase Agreement

[Intentionally omitted from filing]

Exhibit D-1

 

EXHIBIT E

SP Subsidiary Limited Liability Company Agreement

[Intentionally omitted from filing]

Exhibit E-2

 

EXHIBIT F

SP Subsidiary Partnership Agreement

[Intentionally omitted from filing]

Exhibit I-1

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