Document:

Exhibit
4.4

 

 

 

INDENTURE

 

 

by and between

 

 

OMX Timber Finance Investments I, LLC,

as the Issuer,

 

 

and

 

 

WELLS FARGO BANK NORTHWEST, N.A.,

not in its individual capacity but solely in its capacity

as the Indenture Trustee

 

 

Dated
as of December 21, 2004

 

 

 

$735,000,000
(approximate) Class A-1 Notes due 2019

Secured by $817,500,000
Installment Notes Guaranteed by Wachovia Corporation

 

 

TABLE OF CONTENTS

 

	
    

   	
    

   	
   Page

   
	
   

  	
   

  	
   

  
	
  ARTICLE
  I

  	
  DEFINITIONS

  	
  1

  
	
   

  	
   

  	
   

  
	
  Section 1.01.

  	
  Definitions

  	
  1

  
	
  Section 1.02.

  	
  Rules of
  Construction

  	
  11

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  II

  	
  THE
  NOTES

  	
  12

  
	
   

  	
   

  	
   

  
	
  Section 2.01.

  	
  Form

  	
  12

  
	
  Section 2.02.

  	
  Execution,
  Authentication and Delivery

  	
  12

  
	
  Section 2.03.

  	
  Opinions
  of Counsel

  	
  12

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  III

  	
  COVENANTS

  	
  13

  
	
   

  	
   

  	
   

  
	
  Section 3.01. 

  	
  Collection of Payments on Indenture Collateral; Class A-1
  Notes Account 

  	
  13 

  
	
  Section 3.02.

  	
  Maintenance
  of Office or Agency

  	
  13

  
	
  Section 3.03.

  	
  Money
  for Payments To Be Held in Trust; Paying Agent

  	
  13

  
	
  Section 3.04.

  	
  Existence;
  Separate Legal Existence

  	
  15

  
	
  Section 3.05.

  	
  Payment
  of Principal and Interest

  	
  15

  
	
  Section 3.06.

  	
  Protection
  of Indenture Collateral

  	
  15

  
	
  Section 3.07.

  	
  Opinions
  as to Indenture Collateral

  	
  16

  
	
  Section 3.08.

  	
  Furnishing
  of Rule 144A Information

  	
  16

  
	
  Section 3.09.

  	
  Performance
  of Obligations

  	
  17

  
	
  Section 3.10.

  	
  Negative
  Covenants

  	
  17

  
	
  Section 3.11.

  	
  Annual
  Statement as to Compliance

  	
  18

  
	
  Section 3.12.

  	
  Recording
  of Assignments

  	
  18

  
	
  Section 3.13.

  	
  Investment
  Company Act

  	
  18

  
	
  Section 3.14.

  	
  Issuer
  May Consolidate, etc., only on Certain Terms

  	
  18

  
	
  Section 3.15.

  	
  No
  Other Business

  	
  18

  
	
  Section 3.16.

  	
  No
  Borrowing

  	
  19

  
	
  Section 3.17.

  	
  Use
  of Initial Proceeds

  	
  19

  
	
  Section 3.18.

  	
  Guarantees,
  Loans, Advances and Other Liabilities

  	
  19

  
	
  Section 3.19.

  	
  Capital
  Expenditures

  	
  19

  
	
  Section 3.20.

  	
  Representations
  and Warranties of the Issuer

  	
  19

  
	
  Section 3.21.

  	
  Restricted
  Payments

  	
  21

  
					

 

i

 

TABLE
OF CONTENTS

(continued)

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Section 3.22.

  	
  Notice
  of Events of Default

  	
  21

  
	
  Section 3.23.

  	
  Further
  Instruments and Acts

  	
  22

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV 

  	
  THE NOTES; SATISFACTION AND DISCHARGE OF INDENTURE
  

  	
  22 

  
	
   

  	
   

  	
   

  
	
  Section 4.01.

  	
  The
  Notes

  	
  22

  
	
  Section 4.02.

  	
  Registration
  of Transfer and Exchange of Notes

  	
  22

  
	
  Section 4.03.

  	
  Mutilated,
  Destroyed, Lost or Stolen Notes

  	
  27

  
	
  Section 4.04. 

  	
  Payment of Principal and Interest; Extension of
  Maturity Date; Defaulted Interest 

  	
  28 

  
	
  Section 4.05.

  	
  Tax
  Treatment

  	
  29

  
	
  Section 4.06.

  	
  Satisfaction
  and Discharge of Indenture

  	
  30

  
	
  Section 4.07.

  	
  Application
  of Trust Money

  	
  31

  
	
  Section 4.08.

  	
  Repayment
  of Moneys Held by Paying Agent

  	
  31

  
	
   

  	
   

  	
   

  
	
  ARTICLE V

  	
  REMEDIES

  	
  31

  
	
   

  	
   

  	
   

  
	
  Section 5.01.

  	
  Events
  of Default

  	
  31

  
	
  Section 5.02.

  	
  Acceleration
  of Maturity; Rescission and Annulment

  	
  32

  
	
  Section 5.03. 

  	
  Collection of Indebtedness and Suits for
  Enforcement by Indenture Trustee 

  	
  33 

  
	
  Section 5.04.

  	
  Remedies;
  Priorities

  	
  35

  
	
  Section 5.05.

  	
  Optional
  Preservation of the Indenture Collateral

  	
  36

  
	
  Section 5.06.

  	
  Limitation
  of Suits

  	
  37

  
	
  Section 5.07. 

  	
  Unconditional Rights of Holders To Receive
  Principal and Interest 

  	
  37 

  
	
  Section 5.08.

  	
  Restoration
  of Rights and Remedies

  	
  37

  
	
  Section 5.09.

  	
  Rights
  and Remedies Cumulative

  	
  38

  
	
  Section 5.10.

  	
  Delay
  or Omission Not a Waiver

  	
  38

  
	
  Section 5.11.

  	
  Control
  by Holders

  	
  38

  
	
  Section 5.12.

  	
  Waiver
  of Past Defaults

  	
  39

  
	
  Section 5.13.

  	
  Undertaking
  for Costs

  	
  39

  
	
  Section 5.14.

  	
  Waiver
  of Stay or Extension Laws

  	
  39

  
	
  Section 5.15.

  	
  Sale
  of Indenture Collateral

  	
  40

  
				

 

ii

 

TABLE
OF CONTENTS

(continued)

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Section 5.16.

  	
  Action
  on Notes

  	
  41

  
	
  Section 5.17.

  	
  Performance
  and Enforcement of Certain Obligations

  	
  41

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI

  	
  THE
  INDENTURE TRUSTEE

  	
  41

  
	
   

  	
   

  	
   

  
	
  Section 6.01.

  	
  Duties
  of Indenture Trustee

  	
  41

  
	
  Section 6.02.

  	
  Rights
  of Indenture Trustee

  	
  43

  
	
  Section 6.03.

  	
  Individual
  Rights of Indenture Trustee

  	
  43

  
	
  Section 6.04.

  	
  Indenture
  Trustee’s Disclaimer

  	
  44

  
	
  Section 6.05.

  	
  Notice
  of Event of Default

  	
  44

  
	
  Section 6.06.

  	
  Reports
  by Indenture Trustee to Holders

  	
  44

  
	
  Section 6.07.

  	
  Compensation
  and Indemnity

  	
  44

  
	
  Section 6.08.

  	
  Replacement
  of Indenture Trustee

  	
  45

  
	
  Section 6.09.

  	
  Successor
  Indenture Trustee by Merger

  	
  46

  
	
  Section 6.10. 

  	
  Appointment of Co–Indenture Trustee or Separate
  Indenture Trustee 

  	
  47 

  
	
  Section 6.11.

  	
  Eligibility;
  Disqualification

  	
  48

  
	
  Section 6.12. 

  	
  Representations, Warranties and Covenants of
  Indenture Trustee 

  	
  48 

  
	
  Section 6.13.

  	
  Directions
  to Indenture Trustee

  	
  49

  
	
  Section 6.14.

  	
  Conflicts

  	
  50

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  VII 

  	
  HOLDERS’
  LISTS AND REPORTS

  	
  50

  
	
   

  	
   

  	
   

  
	
  Section 7.01. 

  	
  Issuer To Furnish Indenture Trustee Names and
  Addresses of Holders 

  	
  50 

  
	
  Section 7.02.

  	
  Preservation
  of Information; Communications to Holders

  	
  50

  
	
  Section 7.03.

  	
  Fiscal
  Year

  	
  51

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  VIII 

  	
  CLASS A-1
  NOTES ACCOUNT, DISBURSEMENTS AND RELEASES

  	
  51

  
	
   

  	
   

  	
   

  
	
  Section 8.01.

  	
  Collection
  of Money

  	
  51

  
	
  Section 8.02.

  	
  Class A-1
  Notes Account

  	
  51

  
	
   

  	
   

  	
   

  
	
  ARTICLE IX

  	
  SUPPLEMENTAL
  INDENTURES

  	
  52

  
	
   

  	
   

  	
   

  
	
  Section 9.01.

  	
  Supplemental
  Indentures Without Consent of Holders

  	
  52

  
	
  Section 9.02.

  	
  Supplemental
  Indentures With Consent of Holders

  	
  54

  
				

 

iii

 

TABLE OF CONTENTS

(continued)

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Section 9.03.

  	
  Execution of Supplemental
  Indentures

  	
  55

  
	
  Section 9.04.

  	
  Effect of Supplemental
  Indenture

  	
  56

  
	
  Section 9.05.

  	
  Reference in Notes to
  Supplemental Indentures

  	
  56

  
	
  Section 9.06.

  	
  Amendment of this
  Indenture Generally

  	
  56

  
	
   

  	
   

  	
   

  
	
  ARTICLE X

  	
  MISCELLANEOUS

  	
  56

  
	
   

  	
   

  	
   

  
	
  Section 10.01.

  	
  Compliance Certificates
  and Opinions, etc

  	
  56

  
	
  Section 10.02.

  	
  Form of Documents
  Delivered to Indenture Trustee

  	
  57

  
	
  Section 10.03.

  	
  Acts of Holders

  	
  57

  
	
  Section 10.04.

  	
  Notices, etc., to
  Indenture Trustee and Others

  	
  58

  
	
  Section 10.05.

  	
  Notices to Holders; Waiver

  	
  59

  
	
  Section 10.06.

  	
  Alternate Payment and
  Notice Provisions

  	
  59

  
	
  Section 10.07.

  	
  Effect of Headings

  	
  59

  
	
  Section 10.08.

  	
  Successors and Assigns

  	
  60

  
	
  Section 10.09.

  	
  Severability

  	
  60

  
	
  Section 10.10.

  	
  Benefits of Indenture

  	
  60

  
	
  Section 10.11.

  	
  Legal Holidays

  	
  60

  
	
  Section 10.12.

  	
  GOVERNING LAW

  	
  60

  
	
  Section 10.13.

  	
  Counterparts

  	
  61

  
	
  Section 10.14.

  	
  Issuer Obligation

  	
  61

  
	
  Section 10.15.

  	
  No Petition

  	
  61

  
	
  Section 10.16.

  	
  Inspection;
  Confidentiality

  	
  62

  
	
   

  	
   

  	
   

  
				

 

	
  EXHIBITS

  	
   

  	
   

  
	
  Exhibit A

  	
  —

  	
   Form of Class A-1  Note

  
	
  Exhibit B

  	
  —

  	
   Form of Wiring
  Instructions

  
	
  Exhibit C-1

  	
  —

  	
   Form of Transferee
  Letter

  
	
  Exhibit C-2

  	
  —

  	
  Form of
  Rule 144A Certification

  
	
  Exhibit D

  	
  —

  	
  Form of Redemption
  Notice

  
				

 

iv

 

INDENTURE

 

THIS INDENTURE, dated as of
December 21, 2004 (as amended, modified, restated, supplemented or waived
from time to time, the “Indenture”), is by and between OMX TIMBER FINANCE INVESTMENTS I, LLC, a
Delaware limited liability company, as the issuer (together with its successors
and assigns in such capacity, the “Issuer”), and WELLS FARGO BANK NORTHWEST, N.A., a
national banking association, not in its individual capacity but solely in its
capacity as the indenture trustee (together with its successors and assigns, in
such capacity, the “Indenture Trustee”).

 

Each
party agrees as follows for the benefit of the other party and for the equal
and ratable benefit of the Holders of the Issuer’s Notes.

 

GRANTING CLAUSE

 

The
Issuer Grants to the Indenture Trustee, on behalf of and for the benefit of the
Holders of the Notes, without recourse, subject to the terms of this Indenture
and the other Transaction Documents, a continuing security interest in and lien
on all of its right, title and interest in and to all of the property of the
Issuer consisting of, arising out of, or related to (i) the Installment
Notes and the Guaranty, (ii) any and all funds now or hereafter deposited
in or credited to the Class A-1 Notes Account, and (iii) all present
and future claims, demands and causes of action in respect of any or all of the
foregoing and all payments on or under and all proceeds of every kind and
nature whatsoever in respect of any or all of the foregoing, including all
proceeds of the conversion, voluntary or involuntary, into cash or other liquid
property, rights to payment of any and every kind and other forms of
obligations and receivables, instruments and other property which at any time
constitute all or part of or are included in the proceeds of any of the
foregoing (collectively, the “Indenture Collateral”).

 

The
foregoing Grant is made in trust to secure (x) the payment of principal of
and interest on, and any other amounts owing in respect of, the Notes and all
other sums owing by the Issuer hereunder or under any other Transaction
Document, and (y) to secure compliance with the covenants and agreement in
this Indenture and the other Transaction Documents.

 

The
Indenture Trustee, on behalf of the Holders (1) acknowledges such Grant,
and (2) accepts the trusts under this Indenture in accordance with this
Indenture and agrees to perform its duties required in this Indenture to the
best of its ability to the end that the interests of the Holders may be
adequately and effectively protected.

 

ARTICLE I            DEFINITIONS

 

Section 1.01. Definitions.

 

Certain
defined terms used throughout the Indenture are defined above or in this Section
1.01.

 

“Affiliate”
of any specified Person means any other Person controlling or controlled by, or
under common control with, such specified Person. For the purposes of this
definition,

 

 

“control”
(including the terms “controlling”, “controlled by” and “under common control
with”) when used with respect to any specified Person means the possession,
direct or indirect, of the power to vote 20% or more of the voting securities
of such Person or to direct or cause the direction of the management and
policies of such Person whether through the ownership of voting securities, by
contract or otherwise. The Indenture Trustee may conclusively presume that a
Person is not an Affiliate of another Person unless an Authorized Officer of
the Indenture Trustee has actual knowledge to the contrary.

 

“Aggregate
Outstanding Principal Balance” means, as of any date of determination, the
sum of the Outstanding principal balances of each Note outstanding on such
date.

 

“Applicable
Procedures” has the meaning given to such term in subsection 4.02(1)(i).

 

“Authorized
Newspaper” means a newspaper of general circulation in the Borough of
Manhattan, The City of New York, printed in the English language and
customarily published on each Business Day, whether or not published on
Saturdays, Sundays or holidays.

 

“Authorized
Officer” means, (i) with respect to any Person, any person who is
authorized to act for such Person in matters relating to the Transaction
Documents and whose action is binding upon such Person, (ii) with respect
to the Issuer, any member, manager or officer who is authorized to act for the
Issuer, and (iii) with respect to the Indenture Trustee, the Chairman or
Vice President of the Board of Directors or Trustees, the Chairman or Vice
Chairman of the Executive or Standing Committee of the Board of Directors or
Trustees, the President, the Chairman of the Committee on Trust Matters, any
vice president, any assistant vice president, the Secretary, any assistant
secretary, the Treasurer, any assistant treasurer, the Cashier, any assistant
cashier, any trust officer, the Controller and any assistant controller or any
other officer of the Indenture Trustee customarily performing functions similar
to those performed by any of the above designated officers and also, with
respect to a particular matter, any other officer to whom such matter is
referred because of such officer’s knowledge of and familiarity with particular
subject.

 

“Beneficial
Owner” means, with respect to a Note, the Person who is the beneficial
owner of such Note, as reflected on the books of the Depository or on the books
of a Person maintaining an account with such Depository (directly or as an
indirect participant, in accordance with the rules of such Depository), as
the case may be.

 

“Business
Day” means any day other than (a) a Saturday or Sunday, or (b) a
day on which banking institutions in the cities of New York, New York and Salt
Lake City, Utah are authorized or obligated, by law or executive order, to be
closed.

 

“Class A-1
Note Interest Rate” means the rate of interest payable with respect to the
Class A-1 Notes, which shall be equal to 5.420% per annum.

 

“Class A-1
Note Extension Interest Rate” means the rate of interest which is the
greater of (i) the Class A-1 Note Interest Rate plus two hundred
(200) basis points (2.00%) and (ii) a rate per annum equal to the lesser of (A) LIBOR plus 255
basis points (2.55%) and (B) thirteen percent (13.00%).

 

2

 

“Class A-1
Notes Account” has the meaning given to such term in Section 3.01.

 

“Closing
Date” means December 21, 2004.

 

“Code”
means the Internal Revenue Code of 1986, as amended, or any successor
legislation thereto.

 

“Contribution
Agreement” means the Contribution Agreement dated as of the date of this
Indenture, between the Member and the Issuer.

 

“Corporate
Trust Office” means in the case of the Indenture Trustee: Wells Fargo Bank
Northwest, N.A., 299 South Main Street, 12th Floor, Salt Lake City, Utah 84111,
Attention: Corporate Trust Services, or at such other address as the Indenture
Trustee may designate from time to time by notice to the Issuer, or the
principal corporate trust officer of any successor Indenture Trustee at the
address designated by such successor by notice to the Issuer.

 

“Default”
means any occurrence that is, or with notice or the lapse of time or both would
become, an Event of Default.

 

“Depository”
means The Depository Trust Company or its successors or assigns.

 

“Depository
Participant” means a Person for whom, from time to time, the Depository
effects book–entry transfers and pledges of securities deposited with the
Depository.

 

“Direct
Participant” means any broker–dealer, bank or other financial institution
for whom the nominee of the Depository holds an interest in any Note.

 

“DTC”
means The Depository Trust Company, and its successors.

 

“DTC
Custodian” means the Indenture Trustee as a custodian for DTC.

 

“Eligible
Deposit Account” means either a segregated account with a Qualified
Institution, or a segregated trust account with the corporate trust department
of a depository institution organized under the laws of the United States or
any one of the states thereof, including the District of
Columbia (or any domestic branch of a foreign bank), and acting as a trustee for
funds deposited in such account, so long as any of the securities of such
depository institution shall have a credit rating from in the case of Moody’s a
short–term credit rating of “P-1” and in the case of S&P a commercial paper
short–term debt rating of “A-1+” and a long–term unsecured debt rating of
“AA-”.

 

“ERISA”
means the Employee Retirement Income Security Act of 1974, as amended from time
to time, or any successor legislation thereto and the regulations promulgated
and the rulings issued thereunder.

 

“Event
of Default” has the meaning given to such term in Section 5.01.

 

“Exchange
Act” means the Securities Exchange Act of 1934, as amended or supplemented
from time to time.

 

3

 

“Extended
Maturity Date” means January 29, 2020.

 

“FDIC”
shall mean the Federal Deposit Insurance Corporation and any successor thereto.

 

“Global
Notes” means the Notes sold within the United States to U.S. Persons,
initially issued to Qualified Institutional Buyers in the form of beneficial
interests in one or more Global Notes, deposited with the
Indenture Trustee as custodian for the Depository and registered in the name of
the Depository or its nominee, beneficial interests of which are reflected on
the books of the Depository or on the books of a Person maintaining any account
with such Depository (directly or as an indirect participant in accordance with
the rules of such Depository).

 

“Governmental
Authority” means, with respect to any Person, any nation or government, any
state or other political subdivision thereof, any central bank (or similar
monetary or regulatory authority) thereof, any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government and any court or arbitrator having jurisdiction over such Person.

 

“Grant”
means to mortgage, pledge, sell, bargain, warrant, alienate, remise, release,
convey, assign, transfer, create, and grant a lien upon and a security interest
in and right of set off against, deposit, set over and confirm pursuant to the
Indenture. A Grant of Indenture Collateral or of any other agreement or
instrument shall include all rights, powers and options (but none of the
obligations) of the granting party thereunder, including the immediate and
continuing right to claim for, collect, receive and give receipt for principal
and interest payments in respect of such collateral or other agreement or
instrument and all other moneys payable thereunder, to give and receive notices
and other communications, to make waivers or other agreements, to exercise all
rights and options, to bring proceedings in the name of the granting party or
otherwise, and generally to do and receive anything that the granting party is
or may be entitled to do or receive thereunder or with respect thereto.

 

“Guarantor”
means Wachovia Corporation, a North Carolina corporation.

 

“Guaranty”
means the Guaranty executed as of October 29, 2004, by Guarantor for the
benefit of Issuer, as successor-in-interest to OfficeMax Southern Company
(formerly known as Boise Southern Company) and OfficeMax Incorporated (formerly
known as Boise Cascade Corporation).

 

“Holder”
means, with respect to a Note, the Person in whose name such Note is registered
in the Note Register.

 

“Indenture
Collateral” has the meaning given to such term in the Granting Clause.

 

“Indenture
Trustee” has the meaning given to such term in the Preamble.

 

“Indirect
Participant” means any financial institution for whom any Direct
Participant holds an interest in any Note.

 

“Individual
Note” means any Note in permanent certificated form registered in the name
of a Holder other than the Depository or its nominee.

 

4

 

“Indenture Trustee Fee”
shall have the meaning given to such term in Section 6.07.

 

“Independent” means, when
used with respect to any specified Person, the Person (a) is in fact
independent of the Issuer, any other obligor on the Notes, the Indenture
Trustee and any Affiliate of any of the foregoing Persons, (b) does not
have any direct financial interest or any material indirect financial interest
in the Issuer, any such other obligor, the Indenture Trustee or any Affiliate
of any of the foregoing Persons and (c) is not connected with the Issuer,
any such other obligor, the Indenture Trustee or any Affiliate of any of the
foregoing Persons as an officer, employee, trustee, partner, director or person
performing similar functions.

 

“Initial
Purchasers” means Wachovia Capital Markets, LLC and Lehman
Brothers Inc.

 

“Initial
Principal Balance” means $735,000,000.

 

“Installment
Notes” means, collectively, (i) the Installment Note in the principal
amount of $559,500,000 dated as of October 29, 2004, by Boise
Land & Timber, L.L.C. for the benefit of Issuer, as
successor-in-interest to Boise Cascade Corporation, and (ii) the
Installment Note in the principal amount of $258,000,000, dated as of
October 29, 2004, by Boise Land & Timber, L.L.C. for the benefit
of Issuer, as successor-in-interest to Boise Southern Company.

 

“Institutional
Accredited Investor” means any Person meeting the requirements of
Rule 501 (a) (1) – (3) or (7) of Regulation D under
the Securities Act.

 

“Issuer
Order” means a written order or request signed in the name of the Issuer by
any one of its Authorized Officers and delivered to the Indenture Trustee.

 

“Interest
Accrual Period” means the period commencing on a Payment Date and
ending on the day immediately preceding the next Payment Date (or, with respect
to the first Payment Date, the period commencing on the Closing Date and ending
on the day before the first Payment Date).

 

“Investment
Company Act” means the Investment Company Act of 1940, as
amended.

 

“Letter
of Representations” means the Letter of Representations, dated as of
the date of this Indenture, by and among the Issuer, the Indenture Trustee and
the Depository.

 

“LIBOR” means the rate
for deposits in the U.S. dollars having a maturity date of three
(3) months commencing on the first day of the applicable interest period
that appears on Telerate Page 3750 as of 11:00 a.m., London time, on
the date which is two (2) Business Days prior to the Scheduled Maturity
Date. If such rate ceases to be available on Telerate Page 3750, the
Indenture Trustee will request the principal London offices of four major banks
in the London interbank market (as selected by the Indenture Trustee) to
provide the Indenture Trustee with an offered quotation for deposits in U.S.
dollars for the period of three (3) months, commencing on the date which
is two (2) Business Days prior to the Scheduled Maturity Date, to prime
banks in the London interbank market at approximately 11:00 a.m., London
time, on such date and in a principal amount equal to not less than $1,000,000
that is representative for a single transaction in U.S. dollars in that market
at that time. If at least two quotations are provided, then LIBOR on such date
will be the arithmetic mean of those quotations (rounded upwards, if necessary,
to the

 

5

 

nearest
one hundred-thousandth of a percentage point, with 5 one-millionths of a
percentage point rounded upwards). If fewer than two quotations are provided by
such reference banks, then LIBOR on such date will be the arithmetic mean
(rounded upwards, if necessary, to the nearest one hundred-thousandth of a
percentage point, with 5 one-millionths of a percentage point rounded upwards)
of the rates quoted in The City of New York on such date by three major banks
in The City of New York (as selected by the Indenture Trustee) for loans in
U.S. dollars to leading European banks, having a three-month maturity and in a
principal amount equal to not less than $1,000,000 that is representative for a
single transaction in U.S. dollars in that market at that time.

 

“Lien”
means any mortgage, deed of trust, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), preference, priority or
other security agreement or preferential arrangement of any kind or nature
whatsoever, including, without limitation, any conditional sale or other title
retention agreement, and any financing lease having substantially the same
economic effect as any of the foregoing (including any UCC financing statement
or any similar instrument filed against a Person’s assets or properties).

 

“Limited
Liability Company Agreement” means the Limited Liability Company Agreement
of the Issuer, dated as of the date of this Indenture but effective as of
November 24, 2004, between the Member and managers of the Issuer, as such
agreement may be amended, modified, waived, supplemented or restated from time
to time.

 

“Majority
Holders” means the Holders evidencing more than 50% of the Aggregate
Outstanding Principal Balance of all of the Notes.

 

“Maturity
Date” means either (i) the Scheduled Maturity Date, or (ii) if
the term of the Notes is extended pursuant to Section 4.04, the
Extended Maturity Date.

 

“Member”
means OMX Timber Finance Holdings I, LLC, a Delaware limited liability company.

 

“Moody’s”
means Moody’s Investors Service or any successor thereto.

 

“Moody’s
Rating Condition” means, with respect to any action or series of related
actions or proposed transaction or series of proposed transactions, that
Moody’s shall have notified the Indenture Trustee in writing that such action
or series of related actions or the consummation of such proposed transaction
or series of related transactions will not result in a reduction or withdrawal
of the rating issued by Moody’s on the Closing Date with respect to any
outstanding class of Notes as a result of such action or series of related
actions or the consummation of such proposed transaction or series of related
transactions.

 

“Notes”
means collectively, the Class A-1 Secured Notes due 2019 issued pursuant
to this Indenture

 

“Note
Register” has the meaning given to such term in subsection 4.02(a).

 

“Note
Registrar” has the meaning given to such term in subsection 4.02(a).

 

6

 

“Officer’s
Certificate” means a certificate delivered to the Indenture Trustee signed
by a Regular Manager of the Issuer, as required by this Agreement or any other
Transaction Document.

 

“Opinion
of Counsel” means a written opinion of counsel, who may be outside counsel
or internal counsel, for the Issuer, from King & Spalding LLP,
Dechert LLP or other counsel reasonably acceptable to the Indenture
Trustee, as the case may be.

 

“Outstanding”
means as of the date of determination, all Notes theretofore executed,
authenticated and delivered under the Indenture except:

 

(i)            Notes in exchange
for or in lieu of which other Notes have been executed, authenticated and
delivered pursuant to the Indenture unless proof satisfactory to the Indenture
Trustee is presented that any such Notes are held by a holder in due course;
and

 

(ii)           Notes theretofore
canceled by the Note Registrar or delivered to the Indenture Trustee for
cancellation.

 

“Owner”
means each Holder of a Note.

 

“Participant”
means a Person that has an account with DTC.

 

“Payment
Date” means each April 30 and October 31 beginning April 30,
2005, through and including the Maturity Date.

 

“Payment
Direction Letters” means those letters dated as of the date of this
Indenture, from Issuer to the makers of each Installment Note directing that
payment under such Installment Notes be made directly to the Indenture Trustee.

 

“Paying
Agent” means, with respect to the Notes, any paying agent or co–paying
agent appointed pursuant to Section 3.03 of the Indenture, which
initially shall be the Indenture Trustee.

 

“Percentage
Interest” means, with respect to a Note, the fraction, expressed as a
percentage, the numerator of which is the denomination represented by such Note
and the denominator of which is the Initial Principal Balance.

 

“Permitted
Liens” means

 

(a)           with respect to any portion of the
Indenture Collateral, Liens in favor of the Indenture Trustee created pursuant
to this Indenture;

 

(b)           with respect to the interest of the
Issuer in the Indenture Collateral: (i) Liens arising by operation of law
in the ordinary course of business for sums not due or sums that are being
contested in good faith, (ii) Liens for state, municipal and other local
taxes if such taxes shall not at the time be due and payable or if the Issuer
shall currently be contesting the validity thereof in good faith by appropriate
proceedings, and (iii) Liens in favor of the Indenture Trustee created
pursuant to this Indenture; and

 

7

 

(c)           with respect to any assets of the
Issuer, including the Indenture Collateral, Liens securing the Refinancing
Indebtedness, the proceeds of which are used to redeem fully the Notes under Section 4.04.

 

“Person”
means any individual, corporation, estate, partnership, business or statutory trust, limited
liability company, sole proprietorship, joint venture, association, joint stock
company, trust (including any beneficiary thereof), unincorporated
organization or government or any agency or political
subdivision thereof or other entity.

 

“Plan” has the
meaning given to such term in subsection 4.02(v).

 

“Proceeding” means any suit
in equity, action at law or other judicial or administrative proceeding.

 

“Qualified
Institutional Buyer” has the meaning given to such term in Rule 144A under the Securities Act.

 

“Qualified
Institution” means (a) the corporate trust department of
the Indenture Trustee or the corporate trust department of Wachovia Bank,
National Association, or (b) a depository institution organized under the
laws of the United States or any one of the states thereof or the District of
Columbia (or any domestic branch of a foreign bank), (i)(A) that has
either (1) a long-term unsecured debt rating acceptable to the Rating
Agencies, which, in the case of S&P, shall be “AA-” and in the case of
Moody’s, shall be “Aa3,” or (2) a short–term unsecured debt rating or
certificate of deposit rating acceptable to the Rating Agencies, which, in the
case of S&P, shall be “A-1+” and in the case of Moody’s, shall be “P-1,” (B) the parent
corporation, if such parent corporation guarantees the obligations of the
depository institution, of which has either (1) a long–term unsecured debt
rating acceptable to the Rating Agencies, which, in the case of S&P, shall
be “AA-” and in the case of Moody’s, shall be “Aa3” or (2) a short—term
unsecured debt rating or certificate of deposit rating acceptable to the Rating
Agencies, which, in the case of S&P, shall be “A-1+” and in the case of
Moody’s, shall be “P-1,” or (C) otherwise satisfies the Rating Agency
Condition, and (ii) whose deposits are insured by the FDIC and satisfies
the Rating Agency Condition.

 

“Qualified
Purchaser” means a “qualified purchaser” within the meaning of
Section 3(c)(7) of the Investment Company Act.

 

“Rating
Agency” means each of S&P and Moody’s, so long as such Persons maintain a
rating on the Notes; and if any of S&P or Moody’s no longer maintains a
rating on the Notes, such other nationally recognized statistical rating
organization selected by the Indenture Trustee.

 

“Rating
Agency Condition” means, with respect to any action or series of
related actions or proposed transaction or series of related proposed
transactions, that each Rating Agency shall have notified the Indenture Trustee
in writing that such action or series of related actions or the consummation of
such proposed transaction or series of related transactions will not result in
a Ratings Effect.

 

“Ratings
Effect” means, with respect to any action or series of related
actions, a reduction or withdrawal of the then current rating issued by a
Rating Agency with respect to any Notes as a

 

8

 

result
of such action or series of related actions or the consummation of such
proposed transaction or series of related transactions.

 

“Record
Date” means, for book–entry Notes, the calendar day immediately preceding
the applicable Payment Date, and for the Individual Notes, the last Business
Day of the immediately preceding calendar month.

 

“Redemption
Notice” has the meaning given to such term in subsection 4.04(b).

 

“Refinancing
Indebtedness” means indebtedness incurred by the Issuer the
proceeds of which are used to redeem the aggregate principal amount of the
Outstanding Notes, together with all accrued and unpaid interest thereon.

 

“Requirements
of Law” for any Person means the certificate of incorporation or articles of
association and by–laws or other organizational or governing documents of such
Person, and any law, treaty, rule or regulation, or order or determination
of an arbitrator or Governmental Authority, in each case applicable to or
binding upon such Person or to which such Person is subject, whether Federal,
state or local (including, without limitation, usury laws).

 

“Rule 144A
Certification” means a letter substantially in the form attached
as Exhibit C–2.

 

“Satisfaction
Date” means the date which is one hundred eighty-one (181) days after the
date on which all obligations of the Issuer under this Indenture and the Notes
have been paid and/or satisfied in full (other than any ongoing indemnities
contained in this Indenture which by their terms survive the satisfaction of
all other monetary obligations under such Indenture and Notes).

 

“S&P” means Standard
and Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc.
or any successor thereto.

 

“S&P
Rating Condition” means, with respect to any action or series of
related actions or proposed transaction or series of proposed transactions,
that S&P shall have notified the Indenture Trustee in writing that such
action or series of related actions or the consummation of such proposed
transaction or series of related transactions will not result in a reduction or
withdrawal of the then current rating issued by S&P with respect to any
outstanding class of Notes as a result of such action or series of related
actions or the consummation of such proposed transaction or series of related
transactions.

 

“Sale” has the
meaning given to such term in Section 5.15.

 

“Scheduled
Maturity Date” means October 31, 2019.

 

“Securities
Legend” “THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER
ANY STATE SECURITIES OR BLUE SKY LAW OF ANY STATE. THE HOLDER HEREOF, BY
PURCHASING THIS NOTE, AGREES THAT THIS NOTE MAY BE REOFFERED, RESOLD,
PLEDGED OR OTHERWISE

 

9

 

TRANSFERRED
ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER REQUIREMENTS OF LAWS
AND ONLY (1) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”)
TO A U.S. PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A “QIB”) AND WHO IS
A QUALIFIED PURCHASER WITHIN THE MEANING OF SECTION 3(c)(7) UNDER THE
INVESTMENT COMPANY ACT OF 1940, AS AMENDED (A “QUALIFIED PURCHASER”),
PURCHASING FOR ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A QIB WHO
IS ALSO A QUALIFIED PURCHASER, WHOM THE HOLDER HAS INFORMED THAT THE REOFFER,
RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A,
(2) IN CERTIFICATED FORM TO A U.S. PERSON WHO IS AN INSTITUTIONAL
“ACCREDITED INVESTOR” (WITHIN THE MEANING OF RULE 501 (a)(1)-(3) OR
(7) UNDER THE SECURITIES ACT) AND WHO IS ALSO A QUALIFIED PURCHASER,
PURCHASING FOR INVESTMENT AND NOT FOR DISTRIBUTION IN VIOLATION OF THE
SECURITIES ACT, IN EACH CASE, SUBJECT TO (A) THE RECEIPT BY THE INDENTURE
TRUSTEE OF A LETTER SUBSTANTIALLY IN THE FORM PROVIDED IN THE INDENTURE
AND (B) THE RECEIPT BY THE INDENTURE TRUSTEE OF SUCH OTHER EVIDENCE ACCEPTABLE
TO THE INDENTURE TRUSTEE THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN
COMPLIANCE WITH THE SECURITIES ACT AND OTHER REQUIREMENTS OF LAWS OR IN EACH
CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES AND
SECURITIES AND BLUE SKY LAWS OF ANY STATE OF THE UNITED STATES AND ANY OTHER
APPLICABLE JURISDICTION, OR (3) TO A U.S. PERSON PURSUANT TO ANOTHER
EXEMPTION AVAILABLE UNDER THE SECURITIES ACT AND IN ACCORDANCE WITH ANY
APPLICABLE STATE SECURITIES LAWS. THE PURCHASE OF THIS NOTE WILL BE DEEMED A
REPRESENTATION BY THE ACQUIRER THAT EITHER: (I) IT IS NOT, AND IS NOT
ACQUIRING OR HOLDING THIS NOTE, DIRECTLY OR INDIRECTLY, ON BEHALF OF OR WITH
ANY ASSETS OF, AN “EMPLOYEE BENEFIT PLAN” WITHIN THE MEANING OF SECTION 3(3) OF
THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”),
THAT IS SUBJECT TO TITLE I OF ERISA, A “PLAN” WITHIN THE MEANING OF AND SUBJECT
TO SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”);
AN ENTITY THE UNDERLYING ASSETS OF WHICH ARE DEEMED TO INCLUDE ASSETS OF ANY
SUCH PLAN, OR A PLAN THAT IS SUBJECT TO ANY FEDERAL, STATE, LOCAL OR NON-U.S.
LAW (“SIMILAR LAW”) THAT IS SUBSTANTIVELY SIMILAR TO THE PROVISIONS OF
SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE, OR (B) ITS
ACQUISITION AND HOLDING OF THIS NOTE WILL NOT CONSTITUTE OR RESULT IN A
NON-EXEMPT PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR
SECTION 4975 OF THE CODE OR A VIOLATION OF SIMILAR LAW.

 

“Telerate
Page 3750” means the display designated as “Page 3750” on
MoneyLine Telerate, or such other page as may replace the 3750
page on that service or any successor service or services that may be
nominated by the British Bankers’ Association for the purpose of displaying the
London interbank rates of major banks for U.S. dollars.

 

10

 

“Transaction
Documents” means this Indenture, the Notes, the Contribution
Agreement, the Limited Liability Company Agreement, the Installment Notes, the
Guaranty, the Payment Direction Letters and any documents or agreements
executed in connection with the forgoing, as the forgoing documents and
agreements are amended, modified, restated, replaced, substituted, waived,
supplemented or extended from time to time.

 

“Transfer” has the
meaning given to such term in subsection 4.02(r).

 

“Transferee
Letter” means the letter set forth in Exhibit C-1.

 

“Trust
Indenture Act” or “TIA” means the Trust Indenture Act of
1939, as amended from time to time, as in effect on any relevant date.

 

“UCC” means the
Uniform Commercial Code, as amended from time to time, as in effect in any
specified jurisdiction.

 

“U.S.
Person” means a Person who is both (i) a “U.S. person” as defined in
Regulation S under the Securities Act and (ii) a “United States person”
under Section 7701(a)(30) of the Code.

 

“USA
PATRIOT Act” means the United States Uniting and Strengthening
America By Providing Appropriate Tools Required to Intercept and Obstruct
Terrorism Act of 2001, signed into law on and effective as of October 26,
2001, which, among other things, requires that financial institutions, a term
that includes banks, broker-dealers and investment companies, establish and
maintain compliance programs to guard against money laundering activities.

 

Section 1.02.        Rules of
Construction.

 

Unless
the context otherwise requires:

 

(i)            a term has the
meaning given to it;

 

(ii)           an accounting term
not otherwise defined has the meaning given to it in accordance with generally
accepted accounting principles;

 

(iii)          “or” is not exclusive;

 

(iv)          “including” means including
without limitation;

 

(v)           words in the
singular include the plural and words in the plural include the singular;

 

(vi)          any pronouns shall
be deemed to cover all genders; and

 

(vii)         any agreement, instrument or
statute defined or referred to herein or in any instrument or certificate
delivered in connection herewith means such agreement, instrument or statute as
from time to time amended, modified, waived or supplemented and includes (in
the case of agreements or instruments) references to all attachments thereto
and instruments incorporated therein; references to a Person are also to its
permitted successors and assigns.

 

11

 

ARTICLE II          THE
NOTES

 

Section 2.01. Form.

 

The
Notes, together with the Indenture Trustee’s certificate of authentication,
shall be in substantially the form set forth as Exhibit A to this
Indenture with such appropriate insertions, omissions, substitutions and other
variations as are required or permitted by this Indenture and may have
such letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may, consistently herewith, be determined by the
appropriate Authorized Officers executing such Notes, as evidenced by their
execution of the Notes. Any portion of the text of any Note may be set forth on
the reverse thereof, with an appropriate reference thereto on the face of the
Note.

 

The
Notes shall be typewritten, printed, lithographed or engraved or produced by
any combination of these methods (with or without steel engraved borders), all
as determined by the Authorized Officers executing such Notes, as evidenced by
their execution of such Notes.

 

The
terms of the Notes set forth in Exhibit A are part of
the terms of this Indenture. 

 

Section 2.02.   Execution, Authentication
and Delivery.

 

The
Notes shall be executed on behalf of the Issuer by any of its Authorized
Officers. The signature of any such Authorized Officer on the Notes may be
manual or facsimile.

 

A
Note bearing the manual or facsimile signature of an individual who was at any
time an Authorized Officer of the Issuer shall bind the Issuer, notwithstanding
that such individual has ceased to hold such office prior to the authentication
and delivery of such Note or did not hold such office at the date of such Note.

 

The
Indenture Trustee shall upon receipt of an Issuer Order authenticate and
deliver the Notes for original issue in an aggregate amount equal to the
Initial Principal Balance.

 

Each
Note shall be dated the date of its authentication. The Notes shall be issuable
as registered Notes in the minimum initial denominations of $500,000 and in
integral multiples of $1,000 in excess thereof; provided, however, that one Note
may be issued in a different denomination.

 

No
Note shall be entitled to any benefit under this Indenture or be valid or
obligatory for any purpose, unless there appears on such Note a certificate of
authentication substantially in the form provided for herein executed by the
Indenture Trustee by the manual signature of one of its authorized signatories,
and such certificate upon any Note shall be conclusive evidence, and the only
evidence, that such Note has been duly authenticated and delivered hereunder.

 

Section 2.03.   Opinions of Counsel.

 

On
the Closing Date, the Indenture Trustee shall have received: (i) an
Opinion of Counsel, with respect to securities law matters; (ii) an
Opinion of Counsel, with respect to certain U.S. federal income tax matters
relating to the Notes; and (iii) an Opinion of Counsel to

 

12

 

the
Issuer, with respect to the due authorization, valid execution and delivery of
this Indenture and with respect to its binding effect on the Issuer.

 

ARTICLE III         COVENANTS

 

Section 3.01.   Collection of Payments on
Indenture Collateral; Class A-1 Notes Account.

 

The
Indenture Trustee shall establish and cause to be maintained an account owned
by the Indenture Trustee for the benefit of the Issuer for the
collection of payments from the Indenture Collateral (the “Class A-1 Notes Account”). Any amounts
on deposit in the Class A-1 Notes Account shall remain
uninvested. The Indenture Trustee shall ensure that the Class A-1 Notes Account
is established and maintained as an Eligible Deposit Account with a Qualified
Institution. If any institution with which any of the Class A-1 Notes
Account established pursuant to this Indenture is established ceases to be a
Qualified Institution, the Indenture Trustee shall within ten (10) Business
Days establish a replacement account at a Qualified Institution after notice of
such event. The Indenture Trustee shall make all payments of principal of and
interest on the Notes, subject to Section 3.03 and as provided in Section 3.05
herein from moneys on deposit in the Class A-1 Notes Account.

 

Section 3.02.   Maintenance of Office or
Agency.

 

The
Issuer will maintain with the Indenture Trustee an office or agency where,
subject to satisfaction of conditions set forth herein, Notes may be surrendered
for registration of transfer or exchange, and where notices and demands to or
upon the Issuer in respect of the Notes and this Indenture may be served. The
Issuer hereby initially appoints the Indenture Trustee to serve as its agent
for the foregoing purposes. The Issuer will
give prompt written notice to the Indenture Trustee of the location,
and of any change in the location, of any such office or agency. If at any time
the Issuer shall fail to maintain any such office or agency or shall fail to
furnish the Indenture Trustee with the address thereof, such surrenders,
notices and demands may be made or served at the Corporate Trust Office of the
Indenture Trustee, and the Issuer hereby appoints the Indenture Trustee as its
agent to receive all such surrenders, notices and demands.

 

Section 3.03.   Money for Payments To Be
Held in Trust; Paying Agent.

 

The
Issuer appoints the Indenture Trustee as Paying Agent for the payment of
principal and interest on the Notes. As provided in Section 3.01,
all payments of amounts due and payable with respect to any Notes that are to
be made from amounts withdrawn from the Class A-1 Notes Account pursuant
to Section 3.01 shall be made on behalf of the Issuer by the Paying
Agent, and no amounts so withdrawn from the Class A-1 Notes Account for
payments of Notes shall be paid over to the Issuer except as provided in this Section 3.03
and in Section 8.02.

 

The
Issuer may at any time and from time to time vary or terminate the appointment
of any such agent or appoint any additional paying agents for any or all of
such purposes; provided, that, no Paying Agent shall be appointed in a
jurisdiction that subjects payments on the Notes to withholding tax. The Issuer
shall give prompt written notice to the Indenture Trustee, the Rating Agencies
and the Holders of the appointment or termination of any such agent and of
the location and any change in the location of any such office or agency.

 

13

 

The
Issuer will cause each Paying Agent other than the Indenture Trustee to execute
and deliver to the Indenture Trustee an instrument in which such Paying
Agent shall agree with the Indenture Trustee (and if the Indenture Trustee acts
as Paying Agent, it so agrees), subject to the provisions of this Section 3.03, that such
Paying Agent will:

 

(i)            hold all sums held
by it for the payment of amounts due with respect to the Notes in trust for the
benefit of the Persons entitled thereto until such sums shall be paid to such
Persons or otherwise disposed of as herein provided and pay such sums to such
Persons as herein provided;

 

(ii)           give the Indenture
Trustee notice of any default by the Issuer in the making of any payment
required to be made with respect to the Notes;

 

(iii)          at any time during
the continuance of any such default, upon the written request of the Indenture
Trustee, forthwith pay to the Indenture Trustee all sums so held in trust by
such Paying Agent;

 

(iv)          immediately resign
as Paying Agent and forthwith pay to the Indenture Trustee all sums held by it
in trust for the payment of Notes if at any time it ceases to meet the
standards required to be met by a Paying Agent at the time of its appointment;
and

 

(v)           comply with all
requirements of the Code with respect to the withholding from any payments made
by it on any Notes of any applicable withholding taxes imposed thereon and with
respect to any applicable reporting requirements in connection therewith.

 

Subject
to applicable laws with respect to escheat of funds, any money held by the Indenture
Trustee or any Paying Agent in trust for the payment of any amount due with
respect to any Note and remaining unclaimed for two (2) years after such
amount has become due and payable shall be discharged from such trust and be
paid to the Issuer on an Issuer Order; and the Holder of such Note shall
thereafter, as an unsecured general creditor, look only to the Issuer for
payment thereof (but only to the extent of the amounts so paid to the Issuer),
and all liability of the Indenture Trustee or such Paying Agent with respect to
such trust money shall thereupon cease; provided, however,
that the Indenture Trustee or such Paying Agent, before being required to make
any such repayment, shall at the expense and direction of the Issuer cause to
be published once, in an Authorized Newspaper, notice that such money remains
unclaimed and that, after a date specified therein, which shall not be less
than thirty (30) days from the date of such publication, any unclaimed balance
of such money then remaining will be repaid to the Issuer. The Indenture
Trustee shall also adopt and employ, at the expense and direction of the
Issuer, any other reasonable means of notification of such repayment
(including, but not limited to, mailing notice of such repayment to Holders whose
Notes have been called but have not been surrendered for repurchase or whose
right to or interest in moneys due and payable but not claimed is determinable
from the records of the Indenture Trustee or of any Paying Agent, at the last
address of record for each such Holder).

 

14

 

Section 3.04.   Existence; Separate Legal Existence.

 

Prior
to the Satisfaction Date:

 

(a)           The Issuer will keep in full effect
its existence, rights and franchises as a limited liability company
under the laws of the State of Delaware and will obtain and preserve its qualification
to do business in each jurisdiction in which such qualification is or shall be
necessary to protect the validity and enforceability of this
Indenture, the Notes, the other Transaction Documents, the Indenture Collateral
and each other instrument or agreement included in the Indenture Collateral.

 

(b)           The Issuer shall ensure that it is at
all times in compliance with Sections 7 and 9(i) of its Limited Liability
Company Agreement.

 

(c)           The Issuer shall conduct its affairs
strictly in accordance with its organizational documents and observe all
necessary, appropriate and customary statutory limited liability company
formalities.

 

Section 3.05.   Payment of Principal and Interest.

 

The
Issuer will duly and punctually pay the principal of and interest on the Notes
in accordance with the terms of such Notes and this Indenture. On each Payment
Date in accordance with Section 8.02, the Issuer
will cause to be distributed amounts on deposit in the Class A-1 Notes
Account for the benefit of the Holders of the Notes to pay all interest on and
principal of the Notes then due and payable. Amounts properly withheld under
the Code or any applicable state law by any Person from a payment to any Holder
of interest and/or principal shall be considered as having been paid by the
Issuer to such Holder for all purposes of this Indenture.

 

Section 3.06. Protection
of Indenture Collateral.

 

(a)           The Issuer intends the security
interest Granted pursuant to this Indenture in favor of the Indenture Trustee
on behalf of the Holders to be prior to all other liens in respect of the
Indenture Collateral, and the Issuer shall take all actions necessary to obtain
and maintain, for the benefit of the Indenture Trustee on behalf of the
Holders, a first lien on and a first priority, perfected security interest in
the Indenture Collateral. In connection therewith, the Issuer shall cause to be
delivered into the possession of the Indenture Trustee as pledgee hereunder,
indorsed in blank, any “instruments” (within the meaning of the UCC), not
constituting part of chattel paper, evidencing any part of the Indenture
Collateral. The Indenture Trustee acknowledges and agrees that it holds the
Indenture Collateral delivered to it pursuant to this Indenture for the benefit
of the Holders. The Indenture Trustee agrees to maintain continuous possession
of such Indenture Collateral as pledgee hereunder until this Indenture shall
have terminated in accordance with its terms or until the Indenture Trustee is
otherwise authorized to release such instrument from the Indenture Collateral.
The Issuer will from time to time prepare (or shall cause to be prepared),
execute and deliver all such supplements and amendments hereto and all such
financing statements, continuation statements, instruments of further assurance
and other instruments, and will take such other action necessary or advisable to:

 

15

 

(i)            maintain or preserve
the lien and security interest (and the priority thereof) of this Indenture or
carry out more effectively the purposes hereof;

 

(ii)           perfect, publish
notice of or protect the validity of any Grant made by this Indenture;

 

(iii)          enforce any rights
of the Issuer under the Indenture Collateral to the extent commercially
reasonable; or

 

(iv)          preserve and defend title to
the Indenture Collateral and the rights of the Indenture Trustee and
the Holders in such Indenture Collateral against the claims of all other
Persons and parties.

 

Except
as otherwise provided in or permitted by this Indenture, the Indenture Trustee
shall not remove any portion of the Indenture Collateral that consists of money
or is evidenced by an instrument, certificate or other writing from the
jurisdiction in which it was held at the date of the most recent Opinion of
Counsel delivered pursuant to Section 3.07 unless the
Indenture Trustee shall have first received an Opinion of Counsel to the effect
that the lien and security interest created by this Indenture with respect to
such property will continue to be maintained after giving effect to such action
or actions.

 

The
Issuer designates the Indenture Trustee its agent and attorney–in–fact to
execute any financing statement, continuation statement or other instrument
required to be executed pursuant to this Section 3.06.

 

Section 3.07.   Opinions as to Indenture
Collateral.

 

On
or before the Closing Date, the Issuer shall furnish to the Indenture Trustee
an Opinion of Counsel either stating that, in the opinion of such counsel, such
action has been taken with respect to the delivery of Indenture and any other
requisite documents, and with respect to the execution and filing of any
financing statements and continuation statements, as are necessary to perfect
and make effective the lien and security interest of this Indenture and
reciting the details of such action, or stating that, in the opinion of such
counsel, no such action is necessary to make such lien and security interest
effective.

 

Section 3.08.   Furnishing of
Rule 144A Information.

 

The
Issuer will furnish, upon the written request of any Holder or of any owner of
a beneficial interest therein, such information as is specified in paragraph
(d)(4) of Rule 144A under the Securities Act (i) to such Holder
or beneficial owner, (ii) to a prospective purchaser of such Note or
interest therein who is a Qualified Institutional Buyer (and who is also a
Qualified Purchaser) designated by such Holder or beneficial owner, or (iii) to
the Indenture Trustee for delivery to such Holder, beneficial owner or
prospective purchaser, in order to permit compliance by such Holder or
beneficial owner with Rule 144A in connection with the resale of such Note
or beneficial interest therein by such Holder or beneficial owner in reliance
on Rule 144A unless, at the time of such request, the Issuer is
subject to the reporting requirements of Section 13 or 15(d) of the
Exchange Act, or exempt from reporting pursuant to Rule 12g3-2(b) under the
Exchange Act.

 

16

 

Section 3.09. Performance of Obligations.

 

(a)                                  The Issuer will
punctually perform and observe all of its obligations and agreements contained
in this Indenture, the Transaction Documents and in the instruments and agreements
included in the Indenture Collateral.

 

(b)                                 The Issuer may
contract with other Persons to assist it in performing its duties under this
Indenture, the Transaction Documents and in the instruments and agreements
included in the Indenture Collateral, and any performance of such duties by a
Person identified to the Indenture Trustee in an Officer’s Certificate of the
Issuer shall be deemed to be action taken by the Issuer.

 

(c)                                  The Issuer will not
take any action or permit any action to be taken by others which would release
any Person from any of such Person’s covenants or obligations under any of the
documents relating to the Indenture Collateral, or which would result in the
amendment, hypothecation, subordination, termination or discharge of, or impair
the validity or effectiveness of, any of the documents relating to the
Indenture Collateral.

 

Section 3.10. Negative Covenants.

 

So long as any Notes are Outstanding, the Issuer shall not:

 

(i)                                     except
as expressly permitted by this Indenture or any other Transaction Document,
sell, transfer, exchange or otherwise dispose of the Indenture Collateral,
unless directed to do so by the Indenture Trustee;

 

(ii)                                  claim
any credit on, or make any deduction from the principal or interest payable in
respect of, the Notes (other than amounts properly withheld from such payments
under the Code or applicable state law) or assert any claim against any present
or former Holder by reason of the payment of the taxes levied or assessed upon
any part of the Indenture Collateral;

 

(iii)                               permit
the validity or effectiveness of this Indenture to be impaired, or permit the
lien Granted by this Indenture to be amended, hypothecated, subordinated,
terminated or discharged, or permit any Person to be released from any
covenants or obligations with respect to the Notes under this Indenture except
as may be expressly permitted hereby, permit any lien, charge, excise, claim,
security interest, mortgage or other encumbrance (other than the lien of this
Indenture or any other Transaction Document or any other Permitted Lien) to be
created on or extend to or otherwise arise upon or burden the Indenture
Collateral or any part thereof or any interest therein or the proceeds thereof
or permit the lien of this Indenture not to constitute a valid first priority
security interest in the Indenture Collateral;

 

(iv)                              to
the fullest extent permitted by the Delaware Limited Liability Company Act (6
Del. C. Section 18-101, et. seq.), dissolve or liquidate in whole or in
part;

 

17

 

(v)                                 enter
into any agreement which does not contain non-petition and limited recourse
provisions substantially to the effect of Section 11.15 and will
not consent to any amendment or waiver of such provisions;

 

(vi)                              create
any subsidiaries;

 

(vii)                           modify
or amend any of Sections 7, 9(a), 9(b), 9(f)(iii), 9(g), 9(h), 9(i), 10, 11,
12, 13, 14, 15, 19, 20, 25 or 35 under the Limited Liability Company Agreement;
or

 

(viii)                        permit the
modification or amendment of any Transaction Document without delivering notice
of such modification or amendment to each Rating Agency then rating the Notes.

 

Section 3.11. Annual Statement as to
Compliance.

 

If so requested in writing by
the Indenture Trustee, the Majority Holders or a Rating Agency, the Issuer will
deliver to the Indenture Trustee and the Rating Agencies, within ninety (90)
days after the end of each calendar year (commencing with the calendar year
ending 2004), an Officer’s Certificate stating, as to the Person signing such
Officer’s Certificate, that to the best of such Person’s knowledge, based on
such review, the Issuer has complied with all conditions and covenants under
this Indenture throughout such year, or, if there has been such a default in
its compliance with any such condition or covenant, specifying each such
default known to such Person and the nature and status thereof.

 

Section 3.12. Recording of
Assignments.

 

The Issuer shall submit or cause to be submitted for recording any
assignments of the Indenture Collateral requested by the Indenture Trustee
necessary to accomplish the Grant of the security interest of this Indenture.

 

Section 3.13. Investment Company Act.

 

Neither the Issuer nor the Indenture Trustee shall take any action that
would cause the Issuer to be required to register as an “investment company”
under the Investment Company Act.

 

Section 3.14. Issuer
May Consolidate, etc., only on Certain Terms.

 

(a)                                  The
Issuer shall not consolidate or merge with or into any other Person.

 

(b)                                 Except
as otherwise permitted under this Indenture or under the Transaction Documents,
the Issuer shall not convey or transfer all or substantially all of its
properties or assets, including those included in the Indenture Collateral, to
any Person.

 

Section 3.15. No Other Business.

 

Prior to the Satisfaction Date, the Issuer shall not engage in any
business other than financing,
purchasing, owning, selling, managing and enforcing the Indenture Collateral in
the manner contemplated by this Indenture and the Transaction Documents
and issuing the Notes and all activities incidental thereto.

 

18

 

Section 3.16. No Borrowing.

 

Until such time as the Notes have been fully redeemed and all other
amounts due and payable under this Indenture have been indefeasibly paid and
satisfied in full (which redemption may occur contemporaneously with the
incurrence or issuance of Refinancing Indebtedness by the Issuer), the Issuer
shall not issue, incur, assume, guarantee or otherwise become liable, directly
or indirectly, for any indebtedness except for the Notes.

 

Section 3.17. Use of Initial Proceeds.

 

The proceeds from the initial sale of the Notes shall be used
exclusively to pay the transactional expenses of the Issuer, and, after paying
such expenses, the balance will be paid to the Member as a return on capital.

 

Section 3.18. Guarantees, Loans, Advances and Other
Liabilities.

 

Except as contemplated by this Indenture or the other Transaction
Documents, the Issuer shall not make any loan or advance or credit to, or
guarantee (directly or indirectly or by an instrument having the effect of
assuring another’s payment or performance on any obligation or capability of so
doing or otherwise), endorse or otherwise become contingently liable, directly
or indirectly, in connection with the obligations, stocks or dividends of, or
own, purchase, repurchase or acquire (or agree contingently to do so) any
stock, obligations, assets or securities of, or any other interest in, or make
any capital contribution to, any other Person.

 

Section 3.19. Capital Expenditures.

 

The Issuer shall not make any expenditure for capital assets. 

 

Section 3.20. Representations and Warranties of the
Issuer. 

 

The Issuer represents and warrants as follows:

 

(a)                                  Power
and Authority. It has full power, authority and legal right to execute,
deliver and perform its obligations as Issuer under this Indenture and the
Notes (the foregoing documents, the “Issuer
Documents”) and under each of the other Transaction Documents to
which the Issuer is a party.

 

(b)                                 Due
Authorization and Binding Obligation. The execution and delivery of the
Issuer Documents and the other Transaction Documents to which the Issuer is a
party, and the consummation of the transactions provided for therein have been
duly authorized by all  necessary action
on its part. Each of the Issuer Documents and the other Transaction Documents
to which the Issuer is a party constitutes the legal, valid and binding
obligation of the Issuer and is enforceable in accordance with its terms,
except as enforcement of such terms may be limited by bankruptcy, insolvency or
similar laws affecting the enforcement of creditors’ rights generally and by
the availability of equitable remedies.

 

(c)                                  No
Conflict. The execution and delivery of the Issuer Documents and the other
Transaction Documents to which the Issuer is a party, the performance of the
transactions contemplated thereby and the fulfillment of the terms thereof will
not conflict with, result in any

 

19

 

breach
of any of the materials terms and provisions of, or constitute (with or without
notice or lapse of time or both) a default under, any indenture, contract,
agreement, mortgage, deed of trust, or other instrument to which the Issuer is
a party or by which it or any of its property is bound.

 

(d)                                 No Violation. The execution and delivery of the Issuer
Documents and the other Transaction Documents to which the Issuer is a party,
the performance of the transactions contemplated thereby and the fulfillment of
the terms thereof will not conflict with or violate, in any material respect,
any Requirements of Law applicable to the Issuer.

 

(e)                                  All Consents Required. All approvals, authorizations, consents,
orders or other actions of any Person or any Governmental Authority required in
connection with the execution and delivery of the Issuer Documents and the
other Transaction Documents to which the Issuer is a party, the performance of
the transactions contemplated thereby and the fulfillment of the terms thereof
have been obtained.

 

(f)                                    No Proceedings. No litigation or administrative proceeding
of or before any court, tribunal or governmental body is currently pending, or
to the knowledge of the Issuer, threatened, against the Issuer or any of its
respective properties or with respect to the Issuer Documents or any other
Transaction Document to which the Issuer is a party that, if adversely
determined, would have a material adverse effect on the business, properties,
assets or condition (financial or otherwise) of the Issuer or the transactions
contemplated by the Issuer Documents or any of the other Transaction Documents
to which the Issuer is a party.

 

(g)                                 Organization and Good Standing. The Issuer is a limited liability company
duly organized, validly existing and in good standing under the laws of
Delaware and has the requisite power to own its assets and to transact the
business in which it is currently engaged, and had at all relevant times, and
now has, all necessary power, authority and legal right to acquire, own and
pledge the Indenture Collateral.

 

(h)                                 Investment Company Act. The Issuer is not an “investment company”
within the meaning of the Investment Company Act.

 

(i)                                     Location. The Issuer is located (within the meaning of Article 9 of the
UCC) in Delaware. The Issuer agrees that it will not change its location
(within the meaning of Article 9 of the UCC) without at least thirty (30)
days prior written notice to the Indenture Trustee and the Rating Agencies.

 

(j)                                     Security Interest in Collateral.

 

(i)                                     This Indenture creates a valid, continuing
and enforceable security interest (as defined in the applicable UCC) in the
Indenture Collateral in favor of the Indenture Trustee, which security interest
is prior to all other Liens (except for Permitted Liens), and is enforceable as
such against creditors of and purchasers from the Issuer;

 

(ii)                                  the Installment Notes constitute
“instruments” and the Guaranty constitutes a “supporting obligation” within the
meaning of the applicable UCC;

 

20

 

(iii)                               the
Issuer owns and has good and marketable title to such Indenture Collateral free
and clear of any Lien (other than Permitted Liens), claim or encumbrance of any
Person;

 

(iv)                              the
Issuer has caused or will have caused, within ten (10) days, the filing of
all appropriate financing statements in the proper filing office in the
appropriate jurisdictions under Requirements of Law in order to perfect the
security interest in such Indenture Collateral granted to the Indenture Trustee
under this Indenture;

 

(v)                                 other
than the security interest granted by the Issuer pursuant to this Indenture,
the Issuer has not pledged, assigned, sold, granted a security interest in or
otherwise conveyed any of such Indenture Collateral. The Issuer has not
authorized the filing of and is not aware of any financing statements against
the Issuer that include a description of collateral covering such Indenture
Collateral other than any financing statement relating to the security interest
granted by the Issuer under this Indenture. The Issuer is not aware of the
filing of any judgment or tax Lien filings against the Issuer;

 

(vi)                              all
original executed copies of each underlying document that constitute or
evidence the Indenture Collateral have been delivered to and to the knowledge
of the Issuer are in the possession of the Indenture Trustee;

 

(vii)                           the
Issuer has received a written acknowledgment from the Indenture Trustee that
the Indenture Trustee or its bailee is holding the underlying documents that
constitute or evidence the Indenture Collateral solely on behalf of and for the
benefit of the Holders; and

 

(viii)                        none of
the underlying documents that constitute or evidence the Indenture Collateral
has any marks or notations indicating that they have been pledged, assigned or
otherwise conveyed to any Person other than the Issuer and the Indenture
Trustee.

 

Section 3.21. Restricted Payments.

 

Except as permitted by Section 8.02, the Issuer shall not,
directly or indirectly, (i) pay any dividend or make any distribution (by
reduction of capital or otherwise), whether in cash, property, securities or a
combination thereof, to any owner of a beneficial interest in the Issuer or
otherwise with respect to any ownership or equity interest or security in or of
the Issuer, (ii) redeem, purchase, retire or otherwise acquire for value
any such ownership or equity interest or security or (iii) set aside or
otherwise segregate any amounts for any such purpose. The Issuer will not,
directly or indirectly, make payments to or distributions from the Class A-1
Notes Account except in accordance with this Indenture and the Transaction
Documents.

 

Section 3.22. Notice of Events of Default.

 

The Issuer shall give the Indenture Trustee and the Rating Agencies
prompt written notice of each Event of Default hereunder and of any event of
default of any Transaction Document and of any other amendment or waiver of any
Transaction Document, such notice to be given in accordance with Section 10.04.

 

21

 

Section 3.23. Further Instruments and
Acts.

 

Upon request of the Indenture Trustee, the Issuer will execute and
deliver such further instruments and do such further acts as may be reasonably
necessary or proper to carry out more effectively the purpose of this Indenture.

 

ARTICLE
IV                                                  THE
NOTES; SATISFACTION AND DISCHARGE OF INDENTURE

 

Section 4.01. The Notes.

 

(a)                                  Certain
of the Notes shall be registered initially in the name of Cede & Co.
Beneficial Owners will hold interests in such Notes through the book–entry
facilities of the Depository in minimum denominations of $500,000 and integral
multiples of $1,000 in excess thereof. Subject to subsections 4.02(b), (p),
(q) and (r), the Notes shall be issued in such names and
denominations as may be set forth on an Issuer Order delivered to the Indenture
Trustee.

 

(b)                                 The
Notes shall, on original issue, be executed on behalf of the Issuer by an
Authorized Officer of the Issuer, authenticated by the Note Registrar and
delivered by the Indenture Trustee to or upon the order of the Issuer.

 

(c)                                  The
Notes may be held only by U.S. Persons. 

 

Section 4.02. Registration of
Transfer and Exchange of Notes.

 

(a)                                  The
Indenture Trustee shall cause to be kept a Note Register (the “Note Register”)
in which, subject to such reasonable regulations as it may prescribe, the
Issuer shall provide for the registration of Notes and the registration of
transfers and exchanges of Notes as herein provided. The Indenture Trustee
shall be “Note Registrar” for the purpose of registering Notes and transfers of
Notes as herein provided. The Note Register shall contain the name, remittance
instructions, the series and the number in the series.

 

(b)                                 The
Notes shall be issued in minimum denominations of $500,000 initial principal
amount and integral multiples of $1,000 in excess thereof, except that one Note
may be in a different denomination so that the sum of the denominations of all
outstanding Notes shall equal the Initial Principal Balance. On the Closing
Date, the Indenture Trustee will execute and authenticate one or more
(i) Global Notes and/or (ii) Individual Notes all in an aggregate
principal amount that shall equal the Initial Principal Balance.

 

(c)                                  The
Global Notes shall be delivered by the Issuer to the Depository or, pursuant to
the Depository’s instructions, shall be delivered by the Issuer on behalf of
the Depository to and deposited with the DTC Custodian, and in each case shall
be registered in the name of Cede & Co. and shall bear a legend
substantially to the following effect:

 

“Unless this Note is presented by an authorized representative of The
Depository Trust Company, a New York corporation (“DTC”), to the Note
Registrar or its agent for registration of transfer, exchange or payment, and
any Note issued is registered in

 

22

 

the
name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC (and any payment is made to Cede &
Co. or to such other entity as is requested by an authorized representative of
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede &
Co., has an interest herein.”

 

The
Global Notes may be deposited with such other Depository as the Issuer may from
time to time designate, and shall bear such legend as may be appropriate; provided,
that, such successor Depository maintains a book–entry system that
qualifies to be treated as “registered form” under Section 163(f)(3) of
the Code.

 

The
Issuer and the Indenture Trustee are hereby authorized to execute and deliver a
Letter of Representations with the Depository relating to the Notes.

 

(d)                                 With respect to Notes registered in the Note
Register in the name of Cede & Co., as nominee of the Depository, the
Issuer and the Indenture Trustee shall have no responsibility or obligation to
Direct or Indirect Participants or Beneficial Owners for which the Depository
holds Notes from time to time as a Depository. Without limiting the immediately
preceding sentence, the Issuer and the Indenture Trustee shall have no
responsibility or obligation with respect to (a) the accuracy of the
records of the Depository, Cede & Co., or any Direct or Indirect
Participant with respect to the ownership interest in the Notes, (b) the
delivery to any Direct or Indirect Participant or any other Person, other than
a registered Holder of a Note, (c) the payment to any Direct or Indirect
Participant or any other Person, other than a registered Holder of a Note as
shown in the Note Register, of any amount with respect to any distribution of
principal or interest on the Notes or (d) the making of book–entry
transfers among Participants of the Depository with respect to Notes registered
in the Note Register in the name of the nominee of the Depository. No Person
other than a registered Holder of a Note as shown in the Note Register shall
receive a Note evidencing such Note.

 

(e)                                  Upon delivery by the Depository to the
Indenture Trustee of written notice to the effect that the Depository has
determined to substitute a new nominee in place of Cede & Co., and
subject to the provisions hereof with respect to the payment of distributions
by the mailing of checks or drafts to the registered Holders of Notes appearing
as registered Owners in the Note Register on a Record Date, the name
“Cede & Co.” in this Indenture shall refer to such new nominee of the
Depository.

 

(f)                                    In the event that the Depository advises the
Indenture Trustee in writing that the Depository is no longer willing or able
to discharge properly its responsibilities as nominee and depository with
respect to the Global Notes and the Indenture Trustee is unable to locate a
qualified successor, the Global Notes shall no longer be restricted to being
registered in the Note Register in the name of Cede & Co. (or a
successor nominee) as nominee of the Depository. At that time, the Indenture
Trustee may determine that the Global Notes shall be registered in the name of
and deposited with a successor depository operating a global book–entry system,
as may be acceptable to the Indenture Trustee, or such depository’s agent or
designee but, if the Indenture Trustee does not select such alternative global
book–entry system, then upon surrender to the Note Registrar of the Global
Notes by the Depository, accompanied by the registration

 

23

 

instructions
from the Depository for registration, the Indenture Trustee authenticate
Individual Notes. The Indenture Trustee shall not be liable for any
delay in delivery of such instructions and may conclusively rely on, and shall
be protected in relying on, such instructions. Upon the issuance of Individual
Notes, the Indenture Trustee, the
Note Registrar, any Paying Agent and the Issuer shall recognize the
Holders of the Individual Notes as Holders hereunder.

 

(g)                                 Notwithstanding any
other provision of this Agreement to the contrary, so long as any Global Notes are registered in the name of
Cede & Co., as nominee of the Depository, all distributions of
principal and interest on such Global Notes and all notices with respect to
such Global Notes shall be made and given, respectively, in the manner provided
in the Letter of Representations.

 

(h)                                 Subject to the
preceding paragraphs, upon surrender for registration of transfer of any Note
at the office of the Note Registrar and, upon satisfaction of the conditions
set forth below, the Issuer shall execute in the name of the designated
transferee or transferees, a new Note or Notes of the same Percentage Interest
and dated the date of authentication by the Indenture Trustee. The Note
Registrar shall notify the Indenture Trustee of any such transfer.

 

(i)                                     At the option of a
Holder, the Notes held by such Holder may be exchanged for other Notes in
authorized denominations, upon surrender of the Notes to be exchanged at such
office. Whenever any Notes are so surrendered for exchange, the Issuer shall
execute the Notes which such Holder making the exchange is entitled to receive.
Every Note presented or surrendered for transfer or exchange shall be
accompanied by wiring instructions, if applicable, in the form of Exhibit B.
The preceding provisions of this section notwithstanding, the Issuer shall not
be required to make and the Note Registrar shall not register transfers or
exchanges of Notes called for repurchase.

 

(j)                                     No service charge
shall be made for any transfer or exchange of Notes, but prior to transfer the
Note Registrar may require payment by the transferor of a sum sufficient to
cover any tax or governmental charge that may be imposed in connection with any
transfer or exchange of Notes.

 

All Notes surrendered for payment, transfer
and exchange or repurchase shall be marked canceled by the Note Registrar and
retained for one year and destroyed thereafter.

 

(k)                                  By acceptance of an
Individual Note, whether upon original issuance or subsequent transfer, each
Holder of such a Note acknowledges the restrictions on the transfer of such
Note set forth in the Securities Legend and agrees that it will transfer such a
Note only as provided herein. In addition to the provisions of subsection
4.02(m) and (n) the following restrictions shall apply
with respect to the transfer and registration of transfer of an Individual Note
to a transferee that takes delivery in the form of an Individual Note:

 

(i)                                     The
Note Registrar shall register the transfer of an Individual Note if the
requested transfer is being made to a transferee who has provided the Note
Registrar with a Rule 144A Certification; or

 

(ii)                                  The
Note Registrar shall register the transfer of any Individual Note if (x) the transferor has advised
the Note Registrar in writing that the Note is being

 

24

 

transferred to a U.S. Person that is both an Institutional Accredited
Investor and a Qualified Purchaser; and (y) prior to the transfer the
transferee furnishes to the Note Registrar a Transferee Letter; provided,
that, if based upon an Opinion of Counsel to the effect that the
delivery of (x) and (y) above are not sufficient to confirm that the
proposed transfer is being made pursuant to an exemption from, or in a
transaction not subject to, the registration requirements of the Securities Act
and other applicable laws, the Note Registrar may as a condition of the
registration of any such transfer require the transferor to furnish other
certifications, legal opinions or other information prior to registering the
transfer of an Individual Note.

 

(1)                                  Subject to subsection
4.02(n), so long as a Global Note remains outstanding and is held by or on
behalf of the Depository, transfers of beneficial interests in the Global Note,
or transfers by Holders of Individual Notes to transferees that take delivery
in the form of beneficial interests in the Global Note, may be made only in
accordance with the rules of the Depository.

 

(m)                               Transfers of
Interests in Global Notes to Individual Notes. Any and all transfers from a
Global Note to a transferee wishing to take delivery in the form of an
Individual Note will require the transferee to take delivery subject to the
restrictions on the transfer of such Individual Note described on the face of
such Note, and such transferee agrees that it will transfer such Individual
Note only as provided therein and herein. No such transfer shall be made and
the Note Registrar shall not register any such transfer unless such transfer is
made in accordance with this subsection 4.02(m).

 

(i)                                     Transfers
of a beneficial interest in a Global Note to a U.S. Person who is both an
Institutional Accredited Investor and a Qualified Purchaser will require
delivery of such Note to the transferee in the form of an Individual Note and
the Note Registrar shall register such transfer only if prior to the transfer
such transferee furnishes to the Note Registrar (1) a Transferee Letter to
the effect that the transfer is being made to U.S. Person who is both an
Institutional Accredited Investor and a Qualified Purchaser in accordance with
an applicable exemption under the Securities Act, and (2) an Opinion of
Counsel acceptable to the Indenture Trustee that such transfer is in compliance
with the Securities Act.

 

(ii)                                  Transfers
of a beneficial interest in a Global Note to a U.S. Person who is both a
Qualified Institutional Buyer and a Qualified Purchaser wishing to take
delivery in the form of an Individual Note will be registered by the Note
Registrar only if the Note Registrar is provided with a Rule 144A
Certification.

 

(n)                                 Transfers of
Individual Notes to a Global Note. If a Holder of an Individual Note wishes
at any time to transfer such Note to a Person who wishes to take delivery
thereof in the form of a beneficial interest in a Global Note, such transfer
may be effected only in accordance with the Applicable Procedures, and this subsection
4.02(n). Upon receipt by the Note Registrar at the Corporate Trust Office
of (1) the Individual Note to be transferred with an assignment and
transfer, (2) written instructions given in accordance with the Applicable
Procedures from a Depository Participant directing the Note Registrar to credit
or cause to be credited to another specified Depository Participant’s account a
beneficial interest in such Global Note in an amount equal to the denomination
of the Individual Note to be so transferred, (3) a written order given in
accordance with the Applicable Procedures containing information regarding the
account of the

 

25

 

Depository
Participant to be credited with such beneficial interest, and (4) a
Transferee Letter from the transferee of such interest to the effect
that such transferee is a U.S. Person who is both a Qualified Institutional
Buyer and a Qualified Purchaser, the Note Registrar shall cancel such Individual Note, execute and deliver a new
Individual Note for the denomination of the Individual Note not so
transferred, registered in the name of the Holder, and the Note Registrar shall instruct the Depository to increase the
denomination of the Global Note by the denomination of the Individual
Note to be so transferred, and to credit or cause to be credited to the account
of the Person specified in such instructions a corresponding denomination of
the Global Note.

 

It is the intent of the foregoing that under no circumstances may an
Institutional Accredited Investor that is not both a U.S. Person and a
Qualified Institutional Buyer take delivery in the form of a beneficial
interest in a Global Note.

 

(o)                                 An
exchange of a beneficial interest in a Global Note for an Individual Note or
Notes, an exchange of an Individual Note or Notes for a beneficial interest in
a Global Note and an exchange of an
Individual Note or Notes for another Individual Note or Notes (in each case,
whether or not such exchange is made in anticipation of subsequent transfer)
may be made only in accordance with this Section 4.02 and in accordance with the rules of
the Depository and Applicable Procedures.

 

(p)                                 (i)                                     Upon
acceptance for exchange or transfer of an Individual Note for a beneficial
interest in the Global Note as provided herein, the Note Registrar shall cancel
such Individual Note and shall (or shall request the Depository to) endorse on
the schedule affixed to the applicable Global Note (or on a continuation of
such schedule affixed to the Global Note and made a part thereof) an
appropriate notation evidencing the date of such exchange or transfer and an
increase in the Note balance of the Global Note equal to the Note balance of
such Individual Note exchanged or transferred therefor.

 

(ii)                                  Upon acceptance for
exchange or transfer of a beneficial interest in the Global Note for an
Individual Note as provided herein, the Note Registrar shall (or shall request
the Depository to) endorse on the schedule affixed to the Global Note (or on a
continuation of such schedule affixed to the Global Note and made a part
thereof) an appropriate notation evidencing the date of such exchange or
transfer and a decrease in the Note balance of the Global Note equal to the
Note balance of such Individual Note issued in exchange therefor or upon
transfer thereof.

 

(q)                                 The
Securities Legend shall be placed on any Individual Note issued in exchange for
or upon transfer of another Individual Note or of a beneficial interest in the
Global Note.

 

(r)                                    Subject
to the restrictions on transfer and exchange set forth in this Section 4.02, the Holder of any Individual Note
may transfer or exchange the same in whole or in part (in an initial Note
balance equal to the minimum authorized denomination of $500,000 or any
integral multiple of $1,000 in excess thereof) by surrendering such Note at the
Corporate Trust Office, or at the office of any transfer agent, together with
an executed instrument of assignment and transfer satisfactory in form and
substance to the Note Registrar in the case of transfer and a written request
for exchange in the case of exchange. The Holder of a beneficial interest in a
Global Note may, subject to the rules and procedures of the Depository,
cause the Depository (or

 

26

 

its
nominee) to notify the Note Registrar in writing of a request for transfer or
exchange of such beneficial interest for an Individual Note or Notes.
Following a proper request for transfer or exchange, the Note Registrar shall,
within five (5) Business Days of such request made at such Corporate Trust Office, cause the Indenture
Trustee to authenticate and the Note Registrar to deliver at such
Corporate Trust Office, to the transferee (in the case of transfer) or Holder
(in the case of exchange) or send by first class mail at the risk of the
transferee (in the case of transfer) or Holder (in the case of exchange) to
such address as the transferee or Holder, as applicable, may request, an
Individual Note or Notes, as the case may require, for a like aggregate Percentage Interest and in such authorized
denomination or denominations as may be requested. The presentation for
transfer or exchange of any Individual Note shall not be valid unless made at
the Corporate Trust Office by the registered Holder in person, or by a duly
authorized attorney–in–fact.

 

(s)                                  No
transfer of any Note shall be made unless such transfer is exempt from the
registration requirements of the Securities Act and any applicable state
securities laws or is made in accordance with the Securities Act and laws. No
transfer of any Note shall be made if such transfer would require the Issuer to
register as an “investment company” under the Investment Company Act. In the
event of any such transfer, unless such transfer is made in reliance upon
Rule 144A under the Securities Act, the Indenture Trustee may require a
written Opinion of Counsel acceptable to and in form and substance reasonably
satisfactory to the Indenture Trustee that such transfer may be made pursuant
to an exemption, describing the applicable exemption and the basis therefor,
from the Securities Act and laws or is being made pursuant to said Act and
laws, which Opinion of Counsel shall not be an expense of the Indenture Trustee
or the Issuer. The Holder of a Note desiring to effect such transfer shall, and
by accepting a Note and the benefits of this Indenture does hereby agree to,
indemnify the Indenture Trustee, the Issuer and the Initial Purchasers against
any liability that may result if the transfer is not so exempt or is not made
in accordance with such federal and state laws. None of the Issuer, the
Indenture Trustee or the Initial Purchasers intends or is obligated to register
or qualify any Note under the Securities Act or any state securities laws.

 

Section 4.03. Mutilated, Destroyed, Lost or
Stolen Notes.

 

Subject to UCC Section 8–405, if
(i) any mutilated Note is surrendered to the Indenture Trustee, or the
Indenture Trustee receives evidence to its satisfaction of the destruction,
loss or theft of any Note, and (ii) there is delivered to the Indenture
Trustee such security or indemnity as may be required by it to hold the Issuer
and the Indenture Trustee harmless, then, in the absence of notice to the
Issuer, the Note Registrar or the Indenture Trustee that such Note has been
acquired by a protected purchaser, the Issuer shall execute, and upon its
request the Indenture Trustee shall authenticate and deliver, in exchange for
or in lieu of any such mutilated, destroyed, lost or stolen Note, a replacement
Note; provided, however, that if any such
destroyed, lost or stolen Note, but not a mutilated Note, shall have become or
within seven (7) days shall be due and payable, or shall have been called
for repurchase, instead of issuing a replacement Note, the Issuer may pay such
destroyed, lost or stolen Note when so due or payable without surrender
thereof. If, after the delivery of such replacement Note or payment of a
destroyed, lost or stolen Note pursuant to the proviso to the preceding
sentence, a protected purchaser of the original Note in lieu of which such
replacement Note was issued presents for payment such original Note, the Issuer
and the Indenture Trustee shall be entitled to recover such

 

27

 

replacement Note (or such payment) from the Person to whom it was
delivered or any Person taking such replacement Note from such Person to whom
such replacement Note was delivered or any assignee of such Person, except a
protected purchaser, and shall be entitled to recover upon the security or
indemnity provided therefor to the extent of any loss, damage, cost or expense
incurred by the Issuer or the Indenture Trustee in connection therewith.

 

Upon the issuance of any replacement Note under this Section 4.03,
the Issuer may require the payment by the Holder of such Note of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other reasonable expenses (including the fees and
expenses of the Indenture Trustee) connected therewith.

 

Every replacement Note issued pursuant to this Section 4.03
in replacement of any mutilated, destroyed, lost or stolen Note shall
constitute an original additional contractual obligation of the Issuer, whether
or not the mutilated, destroyed, lost or stolen Note shall be at any time
enforceable by anyone, and shall be entitled to all the benefits of this
Indenture equally and proportionately with any and all other Notes duly issued
hereunder.

 

The provisions of this Section 4.03 are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Notes.

 

Section 4.04. Payment of Principal and Interest;
Extension of Maturity Date;  Defaulted
Interest.

 

(a)                                  The
Notes shall accrue interest during each Interest Accrual Period on the basis of
twelve 30-day months in a 360-day year. Any interest or principal, if any,
payable on any Note which is paid or duly provided for by the Issuer on the
applicable Payment Date shall be paid to the Person in whose name such Note is
registered on the Record Date, by wire transfer or, if no account information
is provided, by check mailed first–class, postage prepaid, to such Person’s
address as it appears on the Note Register on such Record Date, except that,
unless Global Notes have been issued pursuant to Section 4.02, with
respect to Notes registered on the Record Date in the name of the nominee of the
Depository (initially, such nominee to be Cede & Co.), payment will be
made by wire transfer in immediately available funds to the account designated
by such Person and except for the payment of principal payable with respect to
such Note on the Maturity Date. The funds represented by any such checks
returned undelivered shall be held in accordance with Section 3.03.

 

(b)                                 The
principal balance of each Outstanding Note shall be due and payable, together
with all accrued and unpaid interest thereon, on the Scheduled Maturity Date.
It is anticipated that the Issuer will redeem fully the Notes, together with
all accrued and unpaid interest thereon, on the Scheduled Maturity Date. The
Issuer shall deliver an irrevocable notice in the form attached as Exhibit D
(a “Redemption Notice”) to the Indenture Trustee of such intent to
redeem at any time on or after September 1, 2019, but prior to October 1,
2019.

 

(c)                                  If
on October 1, 2019, the Issuer has not delivered to the Indenture Trustee
a Redemption Notice, the Indenture Trustee will provide written notice to each
Holder that (A) no such Redemption Notice has been received and
(B) the Indenture Trustee will be obligated to

 

28

 

extend
the maturity of the Notes to the Extended Maturity Date unless instructed, on
or before October 21, 2019, by the Majority Holders not to extend such
maturity.

 

(d)                                 If on October 1, 2019, the Issuer has
delivered to the Indenture Trustee a Redemption Notice, the Indenture
Trustee will provide written notice to each Holder that (A) such Redemption Notice has been received and (B) that, in
the event the Issuer fails to so redeem the Notes on the Scheduled
Maturity Date, the Indenture Trustee will be obligated to extend the maturity of the Notes to the Extended
Maturity Date unless instructed, on or before October 21, 2019, by
the Majority Holders not to extend such maturity.

 

(e)                                  If
(i) in connection with the provisions of Section 4.04(c), the
Indenture Trustee does not receive instructions from the Majority Holders not
to extend by October 21, 2019, or (ii) in connection with the
provisions of Section 4.04(d), the Issuer fails to so redeem the
Notes on the Scheduled Maturity Date and the Indenture Trustee does not receive
by October 21, 2019, instruction from the Majority Holders not to extend
the term of the Notes, then in each case the term of the Notes shall be
extended to the Extended Maturity Date. Upon such Extended Maturity Date, the
Indenture Trustee shall apply the proceeds from the Indenture Collateral
pursuant to Section 8.02(d). If the Indenture Trustee does receive
instructions from the Majority Holders not to extend, then the term of the
Notes shall not be extended, and the Indenture Trustee shall exercise remedies
available pursuant to Article V.

 

(f)                                    If
an extension of the Maturity Date is made, in consideration of such extension,
the Class A-1 Note Interest Rate shall be increased (for the period
beginning on the Scheduled Maturity Date and extending to the Extended Maturity
Date) to the Class A-1 Note Extension Interest Rate.

 

(g)                                 Notwithstanding
the foregoing, the entire unpaid principal balance of the Notes shall be due
and payable, if not previously paid, on the date on which an Event of Default
shall have occurred and be continuing, if the Indenture Trustee with the
consent of the Majority Holders have declared the Notes to be immediately due
and payable in the manner provided in Section 5.02. All principal
payments among the Notes shall be made pro
rata to the Holders. The Indenture Trustee shall notify the Person
in whose name a Note is registered at the close of business on the Record Date
preceding the Payment Date on which the Issuer expects that the final
installment of principal of and interest
on such Note will be paid. Such notice shall be mailed or transmitted by
facsimile prior to such final Payment Date and shall specify that such final
installment will be payable only upon presentation and surrender of such Note
and shall specify the place where such Note may be presented and surrendered
for payment of such installment. Notices in connection with repurchase of Notes
shall be mailed to Holders as provided in Section 10.02.

 

Section 4.05. Tax Treatment.

 

The Issuer has entered into this Indenture, and the Notes will be
issued, with the intention that, for federal, state and local income, business
and franchise tax purposes, (i) the Notes will qualify as indebtedness
secured by the Indenture Collateral and (ii) the Issuer shall not be
treated as an association, taxable mortgage pool or publicly traded partnership
taxable as a corporation. The Issuer, by entering into this Indenture, and each Holder, by the
acceptance of any such Note (and each Beneficial Owner of a Note, by its
acceptance of an interest in the applicable Note),

 

29

 

agree
to treat such Notes for federal, state and local income, business and franchise
tax purposes as indebtedness. Each Holder of such Note agrees that it will
cause any beneficial owner of such Note acquiring an interest in a Note through
it to comply with this Indenture as to treatment of indebtedness under
applicable tax law, as described in this Section 4.05. The parties
hereto agree that they shall not cause or permit the making, as applicable, of any election
under Treasury Regulation
Section 301.7701–3 or any corresponding provision of applicable state law,
whereby the Issuer or any portion thereof would be treated as a corporation for
federal income tax purposes and, except as required by law or the terms of this
Indenture, shall not file tax returns or obtain any federal employer
identification number for the Issuer, but shall treat the Issuer as a security
device and as a disregarded entity for federal and any applicable state income
tax purposes. The provisions of this Indenture shall be construed in
furtherance of the foregoing intended tax treatment.

 

Section 4.06. Satisfaction and
Discharge of Indenture.

 

This
Indenture shall cease to be of further effect with respect to the Notes except
as to (i) rights of registration of transfer and exchange,
(ii) substitution of mutilated, destroyed, lost or stolen Notes,
(iii) rights of Holders to receive payments of principal thereof and
interest thereon, (iv) Sections 3.03, 3.04, 3.15, 4.05,
6.07, 10.15 and the second sentence of 10.16, and
(v) the rights, obligations and immunities of the Indenture Trustee
hereunder (including the rights of the Indenture Trustee under Section 6.07
and the obligations of the Indenture Trustee under Section 4.07), when:

 

(A)                              either

 

(1)                                  all Notes theretofore authenticated and
delivered (other than (i) Notes that have been destroyed, lost or stolen
and that have been replaced or paid as provided in Section 4.03 and
(ii) Notes for whose payment money has theretofore been deposited in trust
or segregated and held in trust by the Issuer and thereafter repaid to the
Issuer or discharged from such trust, as provided in Section 3.03)
have been delivered to the Indenture Trustee for cancellation; or

 

(2)                                  all Notes not theretofore delivered to the
Indenture Trustee for cancellation have been indefeasibly redeemed in full, and
all other obligations of the Issuer under this Indenture have been completely
discharged, whether on the Maturity Date or earlier as provided in this Indenture;
and

 

(B)                                the Issuer has delivered to the Indenture
Trustee an Officer’s Certificate meeting the applicable requirements of Section 10.01
and, subject to Section 10.01, stating that all conditions
precedent herein provided for relating to the satisfaction and discharge of
this Indenture with respect to the Notes have been complied with (or, in the
case of obligations of the Issuer which survive the satisfaction and discharge
of this Indenture, stating that such obligations are currently being complied
with); and

 

(C)                                By acceptance of any Note, the Holder thereof agrees to surrender such
Note to the Indenture Trustee promptly upon such Holder’s receipt of the
Outstanding principal balance of such Note, together with all accrued and
unpaid interest and fees (if any) thereon.

 

30

 

Upon the delivery of the Officer’s Certificate described in subclause
(B) above, the respective obligations and responsibilities of the Issuer
and the Indenture Trustee created hereby shall terminate; and the Indenture Trustee, on written demand of and
at the expense of the Issuer, shall execute (i) proper instruments
acknowledging satisfaction and discharge of this Indenture with respect to the Notes and (ii) any necessary
reconveyance instruments or assignments releasing any remaining
Indenture Collateral to the Issuer.

 

Section 4.07. Application of Trust Money.

 

All moneys deposited with the Indenture Trustee into the Class A-1
Notes Account shall be held in trust and applied by it, in accordance with the
provisions of the Notes and this Indenture, to the payment, either directly or
through any Paying Agent, as the Indenture Trustee may determine, to the Holders of Notes for the
payment or repurchase of which such moneys have been deposited with the
Indenture Trustee, of all sums due and to become due thereon for principal and
interest; but such moneys need not be segregated from other funds except to the
extent required herein or required by law.

 

Section 4.08. Repayment of Moneys Held by Paying
Agent.

 

In connection with the satisfaction and discharge of this Indenture
with respect to the Notes, all moneys then held by any Paying Agent other than
the Indenture Trustee under the provisions of this Indenture with respect to
such Notes shall, upon demand of the Issuer, be paid to the Indenture Trustee
to be held and applied according to Section 3.05 and Section 8.02 and thereupon
such Paying Agent shall be released from all further liability with respect to
such moneys.

 

ARTICLE V                              REMEDIES

 

Section 5.01. Events of Default.

 

Any one of the following events (whatever the reason for such Event of
Default and whether it shall be voluntary or involuntary or be effected by
operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body)
shall constitute an Event of Default:

 

(i)                                     a default in the
payment of any interest on any Note when the same becomes due and payable and
such default shall continue for a period of two (2) Business Days;

 

(ii)                                  failure to pay the
Outstanding principal balance of the Notes on the Maturity Date;

 

(iii)                               there occurs a default
in the observance or performance in any material respect of any covenant or
agreement of the Issuer made in this Indenture, or any representation or
warranty of the Issuer made in this Indenture proving to have been incorrect in
any material respect as of the time when the same shall have been made and such
default or incorrect representation or warranty has a material adverse effect
on the rights of the Holders, and such default shall continue or not be cured,
or the circumstance

 

31

 

or
condition in respect of which such representation or warranty was incorrect
shall not have been eliminated or otherwise cured, for a period of thirty (30)
days (if such failure can be remedied) after there shall have been given to the Issuer by the
Indenture Trustee or to the
Issuer and the Indenture Trustee, by any Holder, a written notice specifying
such default or incorrect representation or warranty and requiring it to be
remedied and stating that such notice is a notice of default hereunder;

 

(iv)                              there occurs the filing of a decree or order
for relief by a court having jurisdiction over the Issuer or any substantial
part of the Indenture Collateral in an involuntary case under any applicable
federal or state bankruptcy, insolvency or other similar law now or hereafter
in effect, or appointing a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of the Issuer or for any substantial part of
the Indenture Collateral, or ordering the winding–up or liquidation of the
Issuer’s affairs, and such decree or order shall remain unstayed and in effect
for a period of thirty (30) consecutive days;

 

(v)                                 there occurs the commencement by the Issuer
of a voluntary case under any applicable federal or state bankruptcy,
insolvency or other similar law now or hereafter in effect, or the consent by
the Issuer to the entry of an order for relief in an involuntary case under any
such law, or the consent by the Issuer to the appointment or taking possession
by a receiver, liquidator, assignee, custodian, trustee, sequestrator or
similar official of the Issuer or for any substantial part of the assets of the
Indenture Collateral, or the making by the Issuer of any general assignment for
the benefit of creditors, or the failure by the Issuer generally to pay its
debts as such debts become due, or the taking of any action by the Issuer in
furtherance of any of the foregoing;

 

(vi)                              the Indenture Trustee, on behalf of the
Holders, shall fail to have a valid and perfected first priority security
interest in the Indenture
Collateral, and such failure to have a perfected first priority security
interest shall have a material adverse effect on the Holders;

 

(vii)                           the Issuer is required to be registered as an
“investment company” under the Investment Company Act; or

 

(viii)                        the failure by the Guarantor to honor a demand for payment by the Indenture
Trustee under the terms of the Guaranty.

 

The
Issuer shall deliver to the Indenture Trustee and the Rating Agencies, within
two (2) Business Days after the occurrence of an Event of Default, written
notice in the form of an Officer’s Certificate of any event which with the
giving of notice and the lapse of time would become an Event of Default under
clause (v) of the definition of “Event of Default,” its status and what
action the Issuer is taking or proposes to take with respect thereto.

 

Section 5.02. Acceleration of Maturity; Rescission
and Annulment.

 

If
an Event of Default should occur and be continuing, (other than an Event of
Default specified in Section 5.01(iv), 5.01(v), or 5.01(viii)), then and in every such case the Indenture Trustee
or the Majority Holders may declare the Notes to be immediately due and payable, by a

 

32

 

notice in writing to the Issuer and the Rating Agencies (and to the
Indenture Trustee if given by Holders), and upon any such declaration the
unpaid principal balance of such Notes, together with accrued and unpaid
interest thereon through the date of acceleration, shall become immediately due
and payable. If an Event of Default specified in Section 5.01(iv) or Section 5.01(v) occurs, the unpaid principal balance of the Notes, together with accrued
and unpaid interest thereon through the date of acceleration, shall become
immediately due and payable.

 

At any time after such declaration of acceleration of maturity has been
made and before a judgment or decree for payment of the money due has been
obtained by the Indenture Trustee as hereinafter in this Article V provided, the
Majority Holders, by written notice to the Issuer and the Indenture Trustee,
may rescind and annul such declaration and its consequences if:

 

(A)                              the Issuer has paid or
deposited with the Indenture Trustee a sum sufficient to pay:

 

(i)                                     all payments of
principal of and accrued and unpaid interest on the Notes and all other amounts
that would then be due hereunder and upon the Notes if the Event of Default
giving rise to such acceleration had not occurred; and

 

(ii)                                  all sums paid or
advanced by the Indenture Trustee hereunder and the reasonable compensation,
expenses, disbursements and advances of the Indenture Trustee and its agents
and counsel; and

 

(B)                                all Events of Default,
other than the nonpayment of the principal of the Notes that has become due
solely by such acceleration, have been cured or waived as provided in Section 5.12.

 

No such rescission or annulment shall affect any subsequent default or
impair any right consequent thereto.

 

Section 5.03. Collection of Indebtedness and
Suits for Enforcement by Indenture Trustee.

 

(a)                                  The
Issuer covenants that if (i) default is made in the payment of any
interest on any Note when the same becomes due and payable, and such default
continues for a period of five (5) Business Days, or (ii) default is
made in the payment of the principal any Note when the same becomes due and
payable, the Issuer will, upon demand of the Indenture Trustee, pay to it, for
the benefit of the Holders, the whole amount then due and payable on the Notes
for principal and interest, with interest upon the overdue principal, and in
addition thereto such further amount as shall be sufficient to cover the costs
and expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Indenture Trustee and its agents and counsel.

 

(b)                                 In
case the Issuer shall fail forthwith to pay such amounts upon such demand, the Indenture
Trustee, in its own name and as trustee of an express trust, with the consent
of the Majority Holders and subject to the provisions of Section 10.17 may institute a
Proceeding for the collection of the sums so due and unpaid, and may prosecute
such Proceeding to judgment or

 

33

 

final
decree, and may enforce the same against the Issuer or other obligor upon the
Notes and collect in the manner provided by law out of the Indenture Collateral,
wherever situated, the moneys
adjudged or decreed to be payable.

 

(c)                                  If an Event of Default occurs and is
continuing, the Indenture Trustee may, as more particularly provided in Section 5.04, in its discretion, proceed to protect and
enforce its rights and the
rights of the Holders and by such appropriate Proceedings as the Indenture Trustee shall deem most effective to protect
and enforce any such rights, whether for the specific enforcement of any
covenant or agreement in this Indenture or in aid of the exercise of any power
granted herein, or to enforce any other proper remedy or legal or equitable
right vested in the Indenture Trustee
by this Indenture or by law.

 

(d)                                 In case there shall be pending, relative to
the Issuer or any other obligor upon the Notes, to the Guarantor upon the Guaranty or any Person having or
claiming an ownership interest in the Indenture Collateral, Proceedings under Title 11 of the United States
Code or any other applicable
federal or state bankruptcy, insolvency or other similar law, or in case a
receiver, assignee or trustee in bankruptcy or reorganization, liquidator,
sequestrator or similar official shall have been appointed for or taken
possession of the Issuer or the Guarantor or their respective property or such
other obligor or Person, or in case of any other comparable judicial
Proceedings relative to the Issuer or other obligor upon the Notes, to the
Guarantor upon the Guaranty or to the creditors or property of the Issuer or
such other obligor, the Indenture Trustee, irrespective of whether the
principal of any Notes shall then be due and payable as therein expressed or by
declaration or otherwise and irrespective of whether the Indenture Trustee
shall have made any demand pursuant to the provisions of this Section 5.03, shall be entitled and empowered, by intervention in such Proceedings or
otherwise:

 

(i)                                     to file and prove a claim or claims for the
whole amount of principal and interest owing and unpaid in respect of the Notes
or the Guaranty, as applicable, and to file such other papers or documents as
may be necessary or advisable in order to have the claims of the Indenture
Trustee (including any claim for reasonable compensation to the Indenture
Trustee and each predecessor Indenture Trustee, and their respective agents,
attorneys and counsel, and for reimbursement of all reasonable expenses and
liabilities incurred, and all advances made, by the Indenture Trustee and each
predecessor Indenture Trustee, except as a result of negligence or bad faith)
and of the Holders allowed in such Proceedings;

 

(ii)                                  unless prohibited by applicable law and
regulations, to vote on behalf of the Holders of Notes in any election of a
trustee, a standby trustee or Person performing similar functions in any such
Proceedings;

 

(iii)                               to collect and receive any moneys or other
property payable or deliverable on any such claims and to distribute all
amounts received with respect to the claims of the Holders and of the Indenture
Trustee on their behalf;

 

(iv)                              to file such proofs of claim and other papers
or documents as may be necessary or advisable in order to have the claims of
the Indenture Trustee or the
Holders allowed in any judicial proceedings relative to the Issuer, its
creditors and its property; and

 

34

 

(v)                                 to participate as a member, voting or
otherwise, of any official committee of creditors appointed in such matter;

 

and any trustee, receiver,
liquidator, custodian or other similar official in any such Proceeding is
hereby authorized by each of such Holders to make payments to the Indenture
Trustee, and, in the event that the Indenture Trustee shall consent to the
making of payments directly to such Holders, to pay to the Indenture Trustee
such amounts as shall be sufficient to cover reasonable compensation to the
Indenture Trustee, each predecessor Indenture Trustee and their respective
agents, attorneys and counsel, and all other expenses and liabilities incurred,
and all advances made, by the Indenture Trustee and each predecessor Indenture
Trustee except as a result of negligence or bad faith.

 

(e)                                  Nothing
herein contained shall be deemed to authorize the Indenture Trustee to
authorize or consent to or vote for or accept or adopt on behalf of any Holder
any plan of reorganization, arrangement, adjustment or composition affecting
the Notes or the rights of any Holder thereof or to authorize the Indenture
Trustee to vote in respect of the claim of any Holder in any such proceeding
except, as aforesaid, to vote for the election of a trustee in bankruptcy or
similar Person.

 

(f)                                    All
rights of action and of asserting claims under this Indenture, or under any of
the Notes, may be enforced by the Indenture Trustee without the possession of
any of the Notes or the production thereof in any trial or other Proceedings
relative thereto, and any such action or proceedings instituted by the
Indenture Trustee shall be brought in its own name as trustee of an express
trust, and any recovery of judgment, subject to the payment of the expenses, disbursements
and compensation of the Indenture Trustee, each predecessor Indenture Trustee
and their respective agents and attorneys, shall be for the ratable benefit of the Holders of the Notes.

 

(g)                                 In
any Proceedings brought by the Indenture Trustee (and also any Proceedings
involving the interpretation of any provision of this Indenture to which the
Indenture Trustee shall be a party), the Indenture Trustee shall be held to
represent all the Holders of the Notes, and it shall not be necessary to make any
Holder a party to any such Proceedings.

 

Section 5.04. Remedies; Priorities.

 

(a)                                  If
an Event of Default shall have occurred and be continuing, the Indenture Trustee
may do one or more of the following (subject to Section 5.05 and Section 5.15):

 

(i)                                     institute
Proceedings in its own name and as trustee of an express trust for the
collection of all amounts then payable on the Notes or under this Indenture
with respect thereto, whether by declaration or otherwise, and all amounts
payable under the Indenture Collateral, enforce any judgment obtained, and
collect from the Issuer and any other obligor upon such Notes and from the
Guarantor upon the Guaranty moneys adjudged due;

 

(ii)                                  institute Proceedings
from time to time for the complete or partial foreclosure of this Indenture with respect to the Indenture Collateral
or for enforcement of its rights
in the Indenture Collateral;

 

35

 

(iii)                               exercise any remedies of
a secured party under the UCC and take any other appropriate action to protect
and enforce the rights and remedies of the Indenture Trustee and the Holders of
the Notes; and

 

(iv)                              sell the Indenture
Collateral or any portion thereof or rights or interest therein;

 

provided, however, that the Indenture
Trustee may not sell or otherwise liquidate the Indenture Collateral following
an Event of Default, other than a default in the payment of any principal or
interest on the Notes for thirty (30) days or more, unless (A) the Holders
unanimously consent thereto, (B) the proceeds of such sale or liquidation
distributable to the Holders are sufficient to discharge in full all amounts
then due and unpaid upon the Notes for principal and accrued and unpaid
interest, or (C) the Indenture Trustee determines that the Indenture
Collateral will not continue to provide sufficient funds for the payment of
principal of and interest on the Notes, in accordance with their respective
terms as they would have become due if the Notes had not been declared due and
payable, and the Indenture Trustee obtains the consent of the Holders
evidencing 66 2/3% of the Aggregate Outstanding Principal Balance. In
determining such sufficiency or insufficiency with respect to clauses
(B) and (C), the Indenture Trustee may, but need not, obtain and rely upon
an opinion of an Independent investment banking or accounting firm of national
reputation as to the feasibility of such proposed action and as to the
sufficiency of the Indenture Collateral for such purpose.

 

(b)                                 If
the Indenture Trustee collects any money or property pursuant to this Article V,
it shall pay out the money or property pro rata to the Holders.

 

The Indenture Trustee may fix a record date and Payment Date for any
payment to Holders pursuant to this Section 5.04.  At least
five (5) days before such record date, the Issuer shall mail to each
Holder and the Indenture Trustee a notice that states the record date, the
Payment Date and the amount to be paid.

 

Section 5.05. Optional Preservation of the
Indenture Collateral.

 

If the Notes have been declared to be due and payable under Section 5.02
following an Event of Default and such declaration and its consequences have
not been rescinded and annulled, the Indenture Trustee may, but need not, elect
to maintain possession of the Indenture Collateral. It is the desire of the
parties hereto and the Holders that there be at all times sufficient funds for
the payment of principal of and interest on the Notes and other obligations of
the Issuer and the Indenture Trustee shall take such desire into account when
determining whether or not to maintain possession of the Indenture Collateral.
In determining whether to maintain possession of the Indenture Collateral, the
Indenture Trustee may, but need not, obtain and rely upon an opinion of an
Independent investment banking or accounting firm of national reputation as to
the feasibility of such proposed action and as to the sufficiency of the
Indenture Collateral for such purpose.

 

36

 

Section 5.06. Limitation of Suits.

 

No Holder of any Note shall have any right to institute any Proceeding,
judicial or otherwise, with respect to this Indenture, or for the appointment
of a receiver or trustee, or for any other remedy hereunder, unless and subject
to the provisions of Section 10.17 hereof:

 

(i)                                     the Indenture
Trustee has received from the Issuer or from such Holder a notice that an Event
of Default has occurred and is continuing;

 

(ii)                                  the Holders
evidencing 25% of the Aggregate Outstanding Principal Balance have made written
request to the Indenture Trustee to institute such Proceeding in respect of
such Event of Default in its own name as Indenture Trustee hereunder;

 

(iii)                               such Holder or Holders
have offered to the Indenture Trustee reasonable indemnity against the costs,
expenses and liabilities to be incurred in complying with such request;

 

(iv)                              the Indenture Trustee for
sixty (60) days after its receipt of such notice, request and offer of
indemnity has failed to institute such Proceedings; and

 

(v)                                 no direction
inconsistent with such written request has been given to the Indenture Trustee
during such sixty (60) day period by the Holders of a majority of the
Outstanding principal balance of the Notes.

 

It is understood and intended that no one or more Holders of Notes
shall have any right in any manner whatever by virtue of, or by availing of,
any provision of this Indenture to affect, disturb or prejudice the rights of
any other Holders of Notes or to obtain or to seek to obtain priority or
preference over any other Holders or to enforce any right under this Indenture,
except in the manner herein provided.

 

In the event the Indenture Trustee shall receive conflicting or
inconsistent requests and indemnity from two or more groups of Holders of
Notes, each representing less than a majority of the Aggregate Outstanding
Principal Balance, the Indenture Trustee in its sole discretion may determine
what action, if any, shall be taken, notwithstanding any other provisions of
this Indenture.

 

Section 5.07. Unconditional Rights of
Holders To Receive Principal and Interest.

 

Notwithstanding any other provisions in this Indenture, the Holder of
any Note shall have the right, which is absolute and unconditional, to receive payment of the
principal of and interest, if any, on such Note on or after the
respective due dates thereof expressed in such Note or in this Indenture and
such right shall not be impaired without the consent of such Holder.

 

Section 5.08. Restoration of Rights and
Remedies.

 

If the Indenture Trustee or any Holder has instituted any Proceeding to
enforce any right or remedy under this Indenture and such Proceeding has been
discontinued or abandoned for any reason or has been determined adversely to
the Indenture Trustee or to such Holder, then and in every such case the
Issuer, the Indenture Trustee and the Holders shall, subject to any

 

37

 

determination in such Proceeding, be restored severally and
respectively to their former positions hereunder, and thereafter all rights and
remedies of the Indenture Trustee and the Holders shall continue as though no
such Proceeding had been instituted.

 

Section 5.09. Rights and Remedies
Cumulative.

 

No right or remedy herein conferred upon or reserved to the Indenture
Trustee or to the Holders is intended to be exclusive of any other right or
remedy, and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder or now
or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent
the concurrent assertion or employment of any other appropriate right or
remedy.

 

Section 5.10. Delay or Omission Not a
Waiver.

 

No delay or omission of the Indenture Trustee or any Holder of any Note
to exercise any right or remedy accruing upon any Event of Default shall impair
any such right or remedy or constitute a waiver of any such Event of Default or
an acquiescence therein. Every right and remedy given by this Article V
or by law to the Indenture Trustee or to the Holders may be exercised from time
to time, and as often as may be deemed expedient, by the Indenture Trustee or
by the Holders, as the case may be.

 

Section 5.11. Control by Holders.

 

The Majority Holders shall have the right to direct the time, method
and place of conducting any Proceeding for any remedy available to the
Indenture Trustee with respect to the Notes or exercising any trust or power
conferred on the Indenture Trustee; provided, that:

 

(i)                                     such direction
shall not be in conflict with any rule of law or with this Indenture;

 

(ii)                                  subject to the
express terms of Section 5.04, any direction to the Indenture
Trustee to sell or liquidate the Indenture Collateral shall be by Holders of
the Notes representing 100% of the Aggregate Outstanding Principal Balance of
all Notes;

 

(iii)                               subject to the express
terms of Section 5.04, any direction to the Indenture Trustee to
terminate or release the Guaranty shall be by Holders of the Notes representing
100% of the Aggregate Outstanding Principal Balance of all Notes;

 

(iv)                              if the conditions set
forth in Section 5.05 have been satisfied and the Indenture Trustee
elects to retain the Indenture Collateral pursuant to such Section, then any
direction to the Indenture Trustee to sell or liquidate the Indenture
Collateral shall be of no force and effect unless the Holders unanimously
consent thereto; and

 

(v)                                 the Indenture Trustee
may take any other action deemed proper by the Indenture Trustee that is not
inconsistent with such direction.

 

38

 

Notwithstanding the rights of Holders set forth in this Section 5.11, subject to Section 6.01, the Indenture Trustee need not take
any action that it determines might involve it in liability or might materially
adversely affect the rights of any Holders not consenting to such action.

 

Section 5.12. Waiver of Past Defaults.

 

Prior to the declaration of the acceleration of the maturity of the
Notes as provided in Section 5.02, the
Majority Holders may waive any past Event of Default and its consequences
except an Event of Default with respect to payment of principal of or interest
on any of the Notes or in respect of a covenant or provision hereof which
cannot be modified or amended without the consent of the Holder of each Note.
In the case of any such waiver, the Issuer, the Indenture Trustee and the
Holders shall be restored to their former positions and rights hereunder,
respectively; but no such waiver shall extend to any subsequent or other Event
of Default or impair any right consequent thereto.

 

Upon any such waiver, any Event of Default arising therefrom shall be
deemed to have been cured and not to have occurred, for every purpose of this
Indenture; but no such waiver shall extend to any subsequent or other Event of
Default or impair any right consequent thereto.

 

Section 5.13. Undertaking for Costs.

 

All parties to this Indenture agree, and each Holder of any Note by
such Holder’s acceptance thereof shall be deemed to have agreed, that any court
may in its discretion require, in any suit for the enforcement of any right or
remedy under this Indenture, or in any suit against the Indenture Trustee for
any action taken, suffered or omitted by it as Indenture Trustee, the filing by
any party litigant in such suit of an undertaking to pay the costs of such
suit, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys’ fees, against any party litigant in such suit,
having due regard to the merits and good faith of the claims or defenses made
by such party litigant; but the provisions of this Section 5.13 shall not apply
to (a) any suit instituted by the Indenture Trustee, (b) any suit
instituted by any Holder, or group of Holders, in each case holding in the
aggregate more than 25% of the Aggregate Outstanding Principal Balance or
(c) any suit instituted by any Holder for the enforcement of the payment
of principal of or interest on any Note on or after the respective due dates
expressed in such Note and in this Indenture.

 

Section 5.14. Waiver of Stay or Extension
Laws.

 

The Issuer covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, or plead or in any manner whatsoever, claim
or take the benefit or advantage of, any stay or extension law wherever
enacted, now or at any time hereafter in force, that may affect the covenants
or the performance of this Indenture; and the Issuer (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and covenants that it will not hinder, delay or impede the execution of
any power herein granted to the Indenture Trustee, but will suffer and permit
the execution of every such power as though no such law had been enacted.

 

39

 

Section 5.15. Sale of Indenture
Collateral.

 

(a)                                  The
power to effect any sale or other disposition (a “Sale”) of any portion
of a Indenture Collateral pursuant to Section 5.04
is expressly subject to the provisions of Section 5.05 and this Section 5.15. The power to effect any such Sale
shall not be exhausted by any one or
more Sales as to any portion of the Indenture Collateral remaining unsold, but
shall continue unimpaired until the entire Indenture Collateral shall have been
sold or all amounts payable on the Notes and under this Indenture shall
have been paid. The Indenture Trustee hereby expressly waives its right to any amount fixed by law as compensation for any
Sale.

 

(b)                                 The Indenture Trustee shall not in any
private Sale sell the Indenture Collateral, or any portion thereof,
unless the Holders of all of the Notes consent to or direct the Indenture
Trustee to make such Sale and:

 

(i)                                     the proceeds of
such Sale would be not less than the entire amount which would be payable to the Holders under the
Notes, in full payment thereof on the Payment Date next succeeding the date of
such Sale, or

 

(ii)                                  the Indenture Trustee determines, in its sole
discretion, that the conditions for retention of the Indenture Collateral set
forth in Section 5.05 cannot be satisfied (in making any such
determination, the Indenture Trustee may rely upon an opinion of an Independent
investment banking or accounting firm obtained and delivered as provided in Section 5.05,
and the Majority Holders consent to such Sale, which consent will not be
unreasonably withheld).

 

(c)                                  In connection with a Sale of all or any
portion of the Indenture Collateral:

 

(i)                                     any Holder or Holders of Notes may bid for
and purchase the property offered for Sale, and upon compliance with the terms
of Sale may hold, retain and possess and dispose of such property,
without further accountability, and may, in paying the purchase money therefor, deliver any Notes or claims for interest
thereon in lieu of cash up to the amount which shall, upon distribution
of the net proceeds of such Sale, be payable
thereon, and such Notes, in case the amounts so payable thereon shall be less
than the amount due thereon, shall be returned to the Holders thereof after
being appropriately stamped to show such partial payment;

 

(ii)                                  the Indenture Trustee
may bid for and acquire the property offered for Sale in connection with any Sale thereof, and,
subject to any requirements of, and to the extent permitted by, Requirements of
Law in connection therewith, may purchase all or any portion of the Indenture
Collateral in a private sale, and, in lieu of paying cash therefor, may make
settlement for the purchase price by crediting the gross Sale price against the
sum of (A) the amount which would be distributable to the Holders of the
Notes as a result of such Sale in accordance with subsection 5.04(b) on the Payment Date next
succeeding the date of such Sale and (B) the expenses of the Sale and of any Proceedings in connection therewith
which are reimbursable to it, without being required to produce the Notes in
order to complete any such Sale or in order for the net Sale price to be
credited against such Notes, and any property so acquired by the Indenture
Trustee shall be held and dealt with by it in accordance with the provisions of
this Indenture;

 

40

 

(iii)                               the Indenture Trustee shall execute and
deliver an appropriate instrument of conveyance transferring its interest in
any portion of the Indenture Collateral in connection with a Sale thereof;

 

(iv)                              the Indenture Trustee is hereby irrevocably
appointed the agent and attorney–in–fact of the Issuer to transfer and convey
its interest in any portion of the Indenture Collateral in connection with a
Sale thereof, and to take all
action necessary to effect such
Sale; and

 

(v)                                 no purchaser or transferee at such a Sale
shall be bound to ascertain the Indenture Trustee’s authority, inquire into the
satisfaction of any conditions precedent or see to the application of any
moneys.

 

Section 5.16. Action on Notes.

 

The
Indenture Trustee’s right to seek and recover judgment on the Notes or under
this Indenture shall not be affected by the seeking, obtaining or application
of any other relief under or with respect to this Indenture. Neither the lien
of this Indenture nor any rights or remedies of the Indenture Trustee or the
Holders shall be impaired by the recovery of any judgment by the Indenture
Trustee against the Issuer or by the levy of any execution under such judgment
upon any portion of the
Indenture Collateral or upon any of the assets of the Issuer. Any money or property collected by the Indenture
Trustee shall be applied in accordance with subsection 5.04(b).

 

Section 5.17. Performance and Enforcement of Certain
Obligations.

 

Promptly
following a request from the Indenture Trustee to do so, the Issuer shall take
all such lawful action as the Indenture Trustee may request to compel or secure
the performance and observance by the Issuer, any issuer of the Installment
Notes or the Guarantor of each of their obligations to the Issuer under or in
connection with the Installment Notes, the Guaranty and the other the
Transaction Documents, and to exercise any and all rights, remedies, powers and
privileges lawfully available to the Issuer under or in connection with the
Installment Notes, the Guaranty and the other Transaction Documents to the
extent and in the manner directed by the Indenture Trustee, including
institution of legal or administrative actions or proceedings to compel or
secure performance of obligations under the Transaction Documents.

 

ARTICLE VI                          THE INDENTURE TRUSTEE

 

Section 6.01. Duties of Indenture Trustee.

 

(a)                                  If an Event of Default has occurred and is
continuing, the Indenture Trustee shall exercise the rights and powers vested
in it by this Indenture and use the same degree of care and skill in their
exercise as a prudent person would exercise or use under the circumstances in
the conduct of such person’s own affairs with respect to the Indenture
Collateral.

 

(b)                                 Except during the continuance of an Event of
Default:

 

41

 

(i)                                     the Indenture
Trustee undertakes to perform such duties and only such duties as are
specifically set forth in this Indenture and no implied covenants or
obligations shall be read into this Indenture against the Indenture Trustee;
and

 

(ii)                                  in the absence of bad
faith on its part, the Indenture Trustee may conclusively rely, as to the truth
of the statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Indenture Trustee and conforming to
the requirements of this Indenture; however, the Indenture Trustee shall
examine the certificates and opinions to determine whether or not they conform
to the requirements of this Indenture.

 

(c)                                  The
Indenture Trustee may not be relieved from liability for its own negligent action,
its own negligent failure to act, its own willful misconduct or actions taken
in bad faith, except that:

 

(i)                                     this paragraph
does not limit the effect of paragraph
(b) of this Section 6.01;

 

(ii)                                  the Indenture Trustee
shall not be liable for any error of judgment made in good faith by a Responsible
Officer unless it is proved that the Indenture Trustee was negligent in
ascertaining the pertinent facts; and

 

(iii)                               the Indenture Trustee
shall not be liable with respect to any action it takes or omits to take in
good faith in accordance with a direction received by it pursuant to Section 5.11.

 

(d)                                 Every
provision of this Indenture that
in any way relates to the Indenture Trustee is subject to paragraphs (a), (b), (c) and (g) of
this Section 6.01.

 

(e)                                  The
Indenture Trustee shall not be liable
for interest on any money received by it except as the Indenture Trustee may
agree in writing with the Issuer.

 

(f)                                    Money held in trust by the Indenture Trustee
need not be segregated from other funds except to the extent required by law or
the terms of this Indenture.

 

(g)                                 The Indenture Trustee shall be under
no obligation to exercise any of the rights or powers vested in it by this
Indenture, to expend or risk its own funds or otherwise incur financial
liability or to honor the request or direction of any of the Holders pursuant
to this Indenture, unless the Holders shall have offered to the Indenture
Trustee reasonable security or indemnity against the costs, expenses, and
liabilities that might be incurred by it in compliance with the request or direction.

 

(h)                                 Every
provision of this Indenture relating to
the conduct or affecting the liability of or affording protection to the
Indenture Trustee shall be subject to the provisions of this Section 6.01.

 

(i)                                     The Indenture Trustee shall not be
deemed to have notice of any Event of Default unless a Responsible Officer
assigned to and working in the Indenture Trustee’s Corporate Trust

 

42

 

Office has actual knowledge thereof or if such notice has been
delivered in accordance with Section 10.09.

 

Section 6.02. Rights of Indenture Trustee.

 

(a)                                  The
Indenture Trustee may rely on any document believed by it to be genuine and to
have been signed or presented by the proper person. The Indenture Trustee need
not investigate any fact or matter stated in the document.

 

(b)                                 Before
the Indenture Trustee acts or refrains from acting, it may require an Officer’s
Certificate, or, with respect to legal matters, an Opinion of Counsel. The
Indenture Trustee shall not be liable for any action it takes or omits to take
in good faith in reliance on an Officer’s Certificate or Opinion of Counsel.

 

(c)                                  The
Indenture Trustee may execute any of the trusts or powers hereunder or perform
any duties hereunder either directly or by or through agents or attorneys or a
custodian or nominee, and the Indenture Trustee shall not be responsible for
any misconduct or negligence on the part of, or for the supervision of, any
such agent, attorney, custodian or nominee appointed with due care by it hereunder.

 

(d)                                 The
Indenture Trustee shall not be liable for any action it takes or omits to take
in good faith which it believes to be authorized or within its rights or
powers; provided, however, that the Indenture Trustee’s conduct does not
constitute willful misconduct, negligence or bad faith.

 

(e)                                  The
Indenture Trustee may consult with counsel, and the advice or opinion of
counsel with respect to legal matters relating to this Indenture and the Notes
shall be full and complete authorization and protection from liability in
respect to any action taken, omitted or suffered by it hereunder in good faith
and in accordance with the advice or opinion of such counsel.

 

(f)                                    The
Indenture Trustee shall not be bound to make any investigation into the performance
of the Issuer under this Indenture or any other Transaction Document or into
the matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, note or
other document, but the Indenture Trustee, in its discretion, may make any
further inquiry or investigation into those matters that it deems appropriate,
and if the Indenture Trustee determines to inquire further, it shall be
entitled to examine the books, records and premises of the Issuer, personally
or by agent or attorney.

 

(g)                                 If
the Indenture Trustee is also acting as Paying Agent or as Note Registrar, the rights
and protections afforded to the Indenture Trustee pursuant to this
Article shall also be afforded to it in such additional capacities.

 

Section 6.03. Individual Rights of
Indenture Trustee.

 

The Indenture Trustee in its individual or any other capacity may
become the owner or pledgee of Notes and may otherwise deal with the Issuer or
its Affiliates with the same rights it would have if it were not Indenture
Trustee. Any Note Registrar, co–registrar, Paying Agent or

 

43

 

co–paying
agent may do the same with like rights. However, the Indenture Trustee must
comply with Section 6.11.

 

Section 6.04. Indenture Trustee’s
Disclaimer.

 

The Indenture Trustee (a) shall not be responsible for and makes no
representation as to the validity or adequacy of this Indenture, the Limited
Liability Company Agreement or any other Transaction Document, the validity or
sufficiency of any security interest intended to be created or the
characterization of the Notes for tax purposes; (b) shall not be accountable
for the Issuer’s use of the proceeds from the Notes; and (c) shall not be
responsible for any statement of the Issuer in the Indenture or in any document
issued in connection with the sale of the Notes or in the Notes other than the
Indenture Trustee’s certificate of authentication.

 

Section 6.05. Notice of Event of
Default.

 

The Indenture Trustee shall mail to each Holder notice of an Event of
Default within thirty (30) days after the Indenture Trustee has actual
knowledge thereof in accordance with Section 6.01. Except in the
case of an Event of Default in payment of principal of or interest on any Note,
the Indenture Trustee may withhold the notice if and so long as a committee of
its Responsible Officers in good faith determines that withholding the notice
is in the interests of Holders.

 

Section 6.06. Reports by Indenture
Trustee to Holders.

 

The Indenture Trustee shall deliver to each Holder such information as
may be required to enable such Holder to prepare its federal and state income
tax returns. In addition, upon the Issuer’s or a Holder’s written request, the
Indenture Trustee shall promptly furnish information reasonably requested by
the Issuer or such Holder that is reasonably available to the Indenture Trustee
to enable the Issuer or such Holder to perform its federal and state income tax
reporting obligations.

 

The Indenture Trustee shall not be responsible for the tax reporting,
disclosure, record keeping or other requirements of the Issuer, if any, under
Internal Revenue Code sections 6011(a) or 6112, including, but not limited
to, the preparation of IRS Form 8886 pursuant to Treasury Regulations
Section 1.6011-4(d) or any successor provision.

 

Section 6.07. Compensation and
Indemnity.

 

The Issuer shall pay to the Indenture Trustee (i) on the Closing
Date a fee in the amount of $10,000 and (ii) on each Payment Date a fee in
the amount of $7,500 (the “Indenture Trustee Fee”). By its execution of this Indenture, the Indenture Trustee
acknowledges receipt of (A) the initial $10,000 fee and
(B) $15,000 representing the prepayment of the $7,500 payments due in
connection with the first two (2) Payment
Dates. The Indenture Trustee’s compensation shall not be limited by any law on
compensation of a trustee of an express trust. The Issuer shall
reimburse the Indenture Trustee for all reasonable out–of–pocket expenses
incurred or made by it, including costs of collection, in addition to the
compensation for its services. Such expenses shall include the reasonable
compensation and expenses, disbursements and advances of the Indenture Trustee’s agents,
counsel, accountants and experts. The Issuer shall indemnify the

 

44

 

Indenture
Trustee against any and all loss, liability or expense (including attorneys’
fees) incurred by it in connection with the administration of this trust
and the performance of its duties hereunder. The Indenture Trustee shall notify
the Issuer promptly of any claim for which it may seek indemnity. Failure by the Indenture
Trustee to so notify the Issuer shall not relieve the Issuer of its
obligations hereunder or under the Limited Liability Company Agreement. The
Issuer need not reimburse any expense or indemnify against any loss, liability
or expense incurred by the Indenture Trustee through the Indenture Trustee’s
own willful misconduct, negligence or bad faith.

 

The Indenture Trustee hereby agrees not to cause the filing of a
petition in bankruptcy, insolvency, reorganization, moratorium, receivership,
conservatorship or other similar laws now or hereafter in effect against the
Issuer for the non-payment to the Indenture Trustee of any amounts provided by
this Section 6.07 until at least one year and one day, or, if
longer, the applicable preference period then in effect, after the payment in
full of all Notes issued under this Indenture.

 

The Indenture Trustee shall receive amounts pursuant to this Section 6.07,
and only to the extent that the payment thereof would not result in an Event of
Default and the failure to pay such amounts to the Indenture Trustee will not, by itself,
constitute an Event of Default. Subject
to Section 6.08, the Indenture Trustee shall continue to
serve as Indenture Trustee under this Indenture notwithstanding the fact that
the Indenture Trustee shall not have received amounts due it hereunder and
hereby agrees not to cause the filing of a petition in bankruptcy, insolvency,
reorganization, moratorium, receivership, conservatorship or other similar laws
now or hereafter in effect against the Issuer for the nonpayment to the
Indenture Trustee of any amounts provided by this Section 6.07
until at least one year and one day, or, if longer, the applicable preference
period then in effect, after the payment in full of all Notes issued under this
Indenture.

 

Section 6.08. Replacement of Indenture Trustee.

 

No resignation or removal of the Indenture Trustee and no appointment
of a successor Indenture Trustee shall become effective until the acceptance of
appointment by the successor Indenture Trustee pursuant to this Section 6.08.
The Indenture Trustee may resign at any time by so notifying the Issuer. The
Majority Holders or the Issuer, with the written consent of the Majority
Holders, may remove the Indenture Trustee by so notifying the Indenture Trustee
and the Rating Agencies in writing and may appoint a successor Indenture
Trustee. The Issuer shall remove the Indenture Trustee if:

 

(i)                                     the Indenture
Trustee fails to comply with Section 6.11;

 

(ii)                                  the Indenture Trustee
is adjudged a bankrupt or insolvent;

 

(iii)                               a receiver or other
public officer takes charge of the Indenture Trustee or its property;

 

(iv)                              the Indenture Trustee
otherwise becomes incapable of acting; or

 

45

 

(v)                                 the Indenture Trustee
defaults in any of its obligations under the Transaction Documents and such
default is not cured within thirty (30) days after a Responsible Officer of the
Indenture Trustee receives written
notice of such default.

 

If the Indenture Trustee resigns or is removed or if a vacancy exists
in the office of Indenture Trustee for any reason (the Indenture Trustee in
such event being referred to herein as the retiring Indenture Trustee), the
Issuer shall promptly appoint a successor Indenture Trustee.

 

A successor Indenture Trustee shall deliver a written acceptance of its
appointment to the retiring Indenture Trustee and to the Issuer. Thereupon the
resignation or removal of the retiring Indenture Trustee shall become
effective, and the successor Indenture Trustee shall have all the rights, powers and duties of the Indenture
Trustee under this Indenture. No successor Indenture Trustee shall
accept appointment as provided in this Section 6.08 unless at the
time of such acceptance such Person shall be eligible under the provisions of Section 6.11.
The successor Indenture Trustee shall mail a notice of its succession to
Holders. The retiring Indenture Trustee shall promptly transfer all property
(including all Indenture Collateral) held by it as Indenture Trustee to the
successor Indenture Trustee and shall execute and deliver such instruments and
such other documents as may reasonably be required to more fully and certainly
vest and confirm in the successor Indenture Trustee all such rights, powers,
duties and obligations.

 

If a successor Indenture Trustee does not take office within sixty (60)
days after the retiring Indenture Trustee resigns or is removed, the retiring
Indenture Trustee, the Issuer or the Majority Holders, may petition any court
of competent jurisdiction for the appointment of a successor Indenture Trustee.

 

If the Indenture Trustee fails to comply with Section 6.11,
any Holder may petition any court of competent jurisdiction for the removal of
the Indenture Trustee and the appointment of a successor Indenture Trustee.

 

Notwithstanding the replacement of the Indenture Trustee pursuant to
this Section 6.08, the Issuer’s obligations under Section 6.07
shall continue for the benefit of the retiring Indenture Trustee.

 

Upon acceptance of appointment by a successor Indenture Trustee as
provided in this Section 6.08, the Issuer shall mail notice of such
succession hereunder to all Holders of Notes at their addresses as shown in the
Note Register at their addresses as shown on the register kept by the Issuer,
as provided to the Indenture Trustee. If the Issuer fails to mail such notice
within ten (10) days after acceptance of appointment by the successor
Indenture Trustee, the successor Indenture Trustee shall cause such notice to
be mailed at the expense of the Issuer.

 

Section 6.09. Successor Indenture
Trustee by Merger.

 

If the Indenture Trustee consolidates with, merges or converts into, or
transfers all or substantially all its corporate trust business or assets to,
another corporation or banking association, the resulting, surviving or
transferee corporation without any further act shall be the successor Indenture
Trustee; provided, that, such corporation or banking association
shall be otherwise qualified and eligible under Section 6.11. The
Indenture Trustee shall provide the Rating Agencies prior written notice of any
such transaction.

 

46

 

In
case at the time such successor or successors by merger, conversion or
consolidation to the Indenture Trustee shall succeed to the trusts created by
this Indenture any of the Notes shall have been authenticated but not
delivered, any such successor to the Indenture Trustee may adopt the
certificate of authentication of any predecessor trustee, and deliver such
Notes so authenticated; and in case at that time any of the Notes shall not
have been authenticated, any successor to the Indenture Trustee may authenticate
such Notes either in the name of any predecessor hereunder or in the name of
the successor to the Indenture Trustee; and in all such cases such certificates
shall have the full force which it is anywhere in the Notes or in this
Indenture provided that the certificate of the Indenture Trustee shall have.

 

Section 6.10.   Appointment
of Co—Indenture Trustee or Separate Indenture Trustee.

 

(a)           Notwithstanding any other provisions
of this Indenture, at any time, for the purpose of meeting any legal requirement
of any jurisdiction in which any part of the Indenture Collateral may at the
time be located, the Indenture Trustee shall have the power and may execute and
deliver all instruments to appoint one or more Persons, to act as a co—trustee
or co—trustees, or separate trustee or separate trustees, of all or any part of
the Indenture Collateral, and to vest in such Person or Persons, in such
capacity and for the benefit of the Holders, such interest to the Indenture
Collateral, or any part hereof, and, subject to the other provisions of this Section 6.10, such powers,
duties, obligations, rights and trusts as the Indenture Trustee may consider
necessary or desirable. No co—trustee or separate trustee hereunder shall be
required to meet the terms of eligibility as a successor Indenture Trustee
under Section 6.11 and no notice to the Holders of the
appointment of any co—trustee or separate trustee shall be required under Section 6.08 hereof.  No appointment of a co—trustee or a separate
trustee shall relieve the Indenture Trustee of its duties and obligations
hereunder.

 

(b)           Every separate trustee and co—trustee
shall, to the extent permitted by law, be appointed and act subject to the
following provisions and conditions:

 

(i)            all rights, powers,
duties and obligations conferred or imposed upon the Indenture Trustee shall be
conferred or imposed upon and exercised or performed by the Indenture Trustee
and such separate trustee or co—trustee jointly (it being understood that such
separate trustee or co—trustee is not authorized to act separately without the
Indenture Trustee joining in such act), except to the extent that under any law
of any jurisdiction in which any particular act or acts are to be performed the
Indenture Trustee shall be incompetent or unqualified to perform such act or
acts, in which event such rights, powers, duties and obligations (including the
holding of title to the Indenture Collateral or any portion thereof in any such
jurisdiction) shall be exercised and performed singly by such separate trustee
or co—trustee, but solely at the direction of the Indenture Trustee;

 

(ii)           no trustee
hereunder shall be personally liable by reason of any act or omission of any
other trustee hereunder; and

 

(iii)          the Indenture
Trustee may at any time accept the resignation of or remove any separate
trustee or co—trustee.

 

47

 

(c)           Any notice, request or other writing
given to the Indenture Trustee shall be deemed to have been given to each of
the then separate trustees and co—trustees, as effectively as if given to
each of them. Every instrument appointing any separate trustee or co—trustee shall refer to this
Indenture and the conditions of this Article VI. Each separate
trustee and co—trustee, upon its acceptance of the
trusts conferred, shall be vested with the estates or property specified in
its instrument of appointment, either jointly with the Indenture Trustee or
separately, as may be provided therein, subject to all the provisions
of this Indenture, specifically including every provision of this Indenture
relating to the conduct of affecting the liability of, or affording protection
to, the Indenture Trustee. Every such instrument shall be filed with the
Indenture Trustee.

 

(d)           Any separate trustee or co—trustee
may at any time constitute the Indenture Trustee, its agent or attorney—in—fact
with full power and authority, to the extent not prohibited by law, to do any lawful
act under or in respect of this Indenture on its behalf and in its name. If any separate
trustee or co—trustee shall die, become incapable of
acting, resign or be removed, all of its estates, properties,
rights, remedies and trusts shall vest in and be exercised by the Indenture
Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee.

 

Section 6.11.   Eligibility; Disqualification.

 

The
Indenture Trustee hereunder shall at all times be (i) a
national banking association or banking corporation or trust
company organized and doing business under the laws of any state or the United
States, (ii) authorized under such laws to exercise corporate trust
powers, (iii) having a combined capital and surplus of at least
$200,000,000, (iv) having unsecured and unguaranteed long—term debt
obligations rated at least “Baa3” by Moody’s and “BBB—” by S&P, and
(v) is subject to supervision or examination by federal or state
authority. If such banking association publishes reports of condition at least
annually, pursuant to law or to the requirements of the aforesaid supervising
or examining authority, then for the purposes of this Section 6.11
its combined capital and surplus shall be deemed to be as set forth in its most
recent report of condition so published. In case at any time the Indenture
Trustee shall cease to be eligible in accordance with the provisions of this Section 6.11,
the Indenture Trustee shall (a) give prompt notice to the Issuer and
the Holders that it has so ceased to be eligible to be the Indenture Trustee
and (b) resign, upon the request of the Majority Holders in the manner and
with the effect specified in Section 6.08.

 

Section 6.12.   Representations, Warranties
and Covenants of Indenture Trustee.

 

The
Indenture Trustee hereby makes the following representations, warranties and
covenants on which the Issuer and the Holders shall rely:

 

(a)           the Indenture Trustee is a national
banking association and trust company duly organized, validly existing and in
good standing under the laws of the United States.

 

(b)           it satisfies the criteria
specified in Section 6.11.

 

(c)           The Indenture Trustee has
full power, authority and legal right to execute, deliver and perform this
Indenture and the other Transaction Documents to which it is a party and shall

 

48

 

have
taken all necessary action to authorize the execution, deliver and performance
by it of this Indenture and the other Transaction Documents to which it is a
party.

 

(d)           The execution, delivery and
performance by the Indenture Trustee of this Indenture and the other
Transaction Documents to which it is a party shall not (i) violate any provision of
any law or any order, writ, judgment or decree of any court, arbitrator or governmental
authority applicable to the Indenture Trustee or any of its assets, (ii) violate
any provision of, the corporate charter or by–laws of the Indenture Trustee
or (iii) violate any provision of or constitute, with or without
notice or lapse of time, a default under, or result in the creation or
imposition of any lien on any, properties included in the Indenture Collateral
pursuant to the provisions of, any mortgage, indenture, contract, agreement or
other undertaking to which it is a party, which violation, default or lien
could reasonably be expected to materially and adversely affect the Indenture
Trustee’s performance or ability to perform its duties under this Indenture and
the other Transaction Documents to which it is a party or the transactions
contemplated in this Indenture and the other Transaction Documents to which it
is a party.

 

(e)           The execution, delivery and
performance by the Indenture Trustee of this Indenture and the other
Transaction Documents to which it is a party shall not require the
authorization, consent or approval of, the giving of notice to, the filing or registration
with or the taking of any other action in respect of any governmental authority
or agency regulating the banking and corporate trust activities of the
Indenture Trustee.

 

(f)            This Indenture and the other
Transaction Documents to which it is a party have been duly executed and
delivered by the Indenture Trustee and constitute the legal, valid and binding
agreements of the Indenture Trustee, enforceable in accordance with their
respective terms, subject to the effect of bankruptcy, insolvency, reorganization,
moratorium and other similar laws relating to or affecting creditors’ rights
generally or the application of equitable principles in any proceeding, whether
at law or in equity. The Indenture Trustee agrees and covenants that it will
not at any time in the future, deny that this Indenture and the other
Transaction Documents to which it is a party constitute the legal, valid and
binding agreement of the Indenture Trustee.

 

(g)           The Indenture Trustee shall not take
any action, or fail to take any action, if such action or failure to take
action will materially interfere with the enforcement of any rights of the
Holders under this Indenture or the other Transaction Documents.

 

Section 6.13.   Directions to Indenture
Trustee. 

 

The
Indenture Trustee is hereby directed:

 

(i)            to accept a
collateral assignment of and to hold the assets of the Indenture Collateral as
security for the Holders and to open the Class A-1 Notes Account in
accordance with Section 3.01 and Section 8.02;

 

(ii)           to authenticate and
deliver the Notes substantially in the form prescribed by Exhibit A
in accordance with the terms of this Indenture;

 

(iii)          to execute and
deliver the Transaction Documents to which it is a party;

 

49

 

(iv)          to take all other
actions as shall be required to be taken by the terms of this Indenture;

 

(v)           if, by 12:00 noon
(Eastern Standard Time or Daylight Time, as applicable) on the Business Day
immediately preceding a Payment Date, there are not sufficient funds in the
Class A-1 Notes Account to make the applicable interest payment on the
Notes, to make a demand for payment under the Guaranty;

 

(vi)          if, by 12:00 noon
(Eastern Standard Time or Daylight Time, as applicable) on the Business Day
immediately after the Extended Maturity Date, there are not sufficient funds in
the Class A-1 Notes Account to pay in full the Aggregate Outstanding
Principal Balance of the Notes, together with all accrued and unpaid interest
thereon, to make a demand for payment under the Guaranty; and

 

(vii)         upon the occurrence
of an Accelerated Payment Default (as defined in Guaranty), to make a demand
for payment under the Guaranty.

 

Section 6.14.   Conflicts.

 

If
a Default occurs and is continuing and the Indenture Trustee is deemed to have
a “conflicting interest” (as defined in the TIA) as a result of acting as
trustee for the Notes, the Issuer shall appoint a successor Indenture Trustee
pursuant to the terms of this Indenture. No such event shall alter the voting
rights of the Holders under this Indenture or under any of the other
Transaction Documents.

 

ARTICLE VII       HOLDERS’
LISTS AND REPORTS

 

Section 7.01.   Issuer To Furnish Indenture Trustee Names and Addresses of Holders.

 

The
Issuer will furnish or cause to be furnished to the Indenture Trustee
(a) within one day after each Record Date, a list, in such form as the
Indenture Trustee may reasonably require, of the names and addresses of the
Holders of Notes as of such Record Date and (b) at such other times as the
Indenture Trustee may reasonably request in writing, within thirty (30) days
after receipt by the Issuer of any such request, a list of similar
form and content as of a date not more than ten (10) days
prior to the time such list is furnished; provided, however,  that
so long as the Indenture Trustee is the Note Registrar, no such list shall be
required to be furnished.

 

Section 7.02.   Preservation of Information; Communications to Holders.

 

(a)           The Indenture Trustee shall preserve,
in as current a form as is reasonably practicable, the names and addresses of
the Holders of Notes contained in the most recent list furnished to the
Indenture Trustee as provided in Section 7.01 and the names and
addresses of Holders of Notes received by the Indenture Trustee in its capacity
as Note Registrar. The Indenture Trustee may destroy any list furnished to it
as provided in such Section 7.01 upon receipt of a new list so
furnished.

 

50

 

(b)           Holders may communicate pursuant to
TIA Section 312(b) with other Holders with respect to their rights
under this Indenture or under the Notes.

 

(c)           The Issuer, the Indenture Trustee and
the Note Registrar shall have the protection of TIA Section 312(c).

 

(d)           The Indenture Trustee shall furnish
to the Holders promptly upon receipt of a written request therefor, duplicates
or copies of all reports, notices, requests, demands, certificates, financial
statements and any other instruments furnished to the Indenture Trustee under
the Transaction Documents.

 

Section 7.03.   Fiscal Year.

 

Unless
the Issuer otherwise determines, the fiscal year of the Issuer shall end on
December 31 of each year.

 

ARTICLE VIII      CLASS A-1
NOTES ACCOUNT, DISBURSEMENTS AND RELEASES

 

Section 8.01.   Collection of Money.

 

Except
as otherwise expressly provided herein, the Indenture Trustee may demand
payment or delivery of, and shall receive and collect, directly and without
intervention or assistance of any fiscal agent or other intermediary, all
money and other property payable to or receivable by the Indenture Trustee
pursuant to this Indenture. The Indenture Trustee shall apply all such money
received by it as provided in this Indenture. Except as otherwise expressly
provided in this Indenture, if any Event of Default occurs in
the making of any payment or performance under any agreement or instrument that
is part of the Indenture Collateral, the Indenture Trustee may take such action
as may be appropriate to enforce such payment or performance, including
the institution and prosecution of appropriate Proceedings. Any such action
shall be without prejudice to any right to claim a Default or Event of Default
under this Indenture and any right to proceed thereafter as provided in Article V.

 

Section 8.02.   Class A-1 Notes
Account.

 

(a)           On or prior to the Closing Date, the
Indenture Trustee shall establish and maintain for the benefit of the Issuer,
the Class A-1 Notes Account.

 

(b)           All funds received by Indenture
Trustee which are (i) proceeds of the Installment Notes or the Guaranty
(including any amounts received as payment on the Guaranty after a demand is
made thereon) or (ii) other moneys that are accompanied by directions of
the Issuer and/or the Member, as applicable, that such moneys are to be
deposited into the Class A-1 Notes Account, shall be deposited in the
Class A-1 Notes Account.

 

(c)           On the Business Day immediately
preceding each Payment Date, the Indenture Trustee shall determine whether the
amount of interest and/or principal on the Notes that will be due for payment
on such Payment Date exceeds the amount on deposit in the Class A-1 Notes
Account. If there are insufficient funds on deposit in the Class A-1 Notes
Account to make such

 

51

 

interest
and/or principal payments, the Indenture Trustee shall send a notice on such
Business Day immediately preceding such Payment Date, to the Paying Agent and
to the Issuer stating (i) that there will be a
shortfall in the payment of interest and/or principal on such Payment Date and
(ii) the amount of such shortfall.

 

(d)           On each Payment Date and on the
Maturity Date (if applicable), the Paying Agent shall pay from funds in the
Class A-1 Notes Account:

 

(i)            FIRST, to the
Indenture Trustee, the Indenture Trustee Fee from the preceding Interest
Accrual Period (to the extent not previously paid);

 

(ii)           SECOND, to each
Holder (A) on each Payment Date, the interest (and principal, if any) due
and owing in respect of such Holder’s Notes, and (B) on the Maturity Date,
an amount equal to the Outstanding principal balance of the Notes held by such
Holder, together with all accrued and unpaid interest thereon;

 

(iii)          THIRD, to the
Indenture Trustee, any additional expenses incurred by Indenture Trustee in
connection with the transactions contemplated by the Transaction Documents; and

 

(iv)          FOURTH, provided no
Event of Default has occurred and is continuing, to the Issuer, any remaining
funds to or at the Issuer’s direction for payment of the Issuer’s expenses of
operation and for distribution to the Member as a return on capital.

 

(e)           All moneys deposited from time to
time in the Class A-1 Notes Account pursuant to this Indenture are held
for the benefit of the Issuer and are pledged to the Indenture Trustee for the
benefit of the Holders.

 

ARTICLE IX         SUPPLEMENTAL
INDENTURES

 

Section 9.01.   Supplemental Indentures Without Consent of Holders.

 

(a)           Without the consent of the Holders of
any Notes but with the prior notice to the Rating Agencies, the Issuer and the
Indenture Trustee, when authorized by an Issuer Order, at any time and from
time to time, may enter into one or more indentures supplemental, in form
satisfactory to the Indenture Trustee, for any of the following purposes;
provided, however, that the Issuer shall only enter into an indenture supplemental
hereunder in compliance the provisions of the Limited Liability Company
Agreement:

 

(i)            to correct or
amplify the description of any assets at any time subject to the lien of this
Indenture, or better to assure, convey and confirm unto the Indenture Trustee
any property subject or required to be subjected to the lien of this Indenture,
or to subject to the lien of this Indenture additional property;

 

(ii)           to evidence the
succession, in compliance with the applicable provisions hereof, of another
person to the Issuer, and the assumption by any such successor of the covenants
of the Issuer herein and in the Notes contained;

 

52

 

(iii)          to add to the
covenants of the Issuer, for the benefit of the Holders of the Notes, or to surrender
any right or power herein conferred upon the Issuer;

 

(iv)          to convey, transfer,
assign, mortgage or pledge any property to or with the Indenture Trustee;

 

(v)           to cure any
ambiguity, to correct or supplement any provision herein or in any supplemental
indenture that may be inconsistent with any other provision herein or in any
supplemental indenture or to make any other provisions with respect to matters
or questions arising under this Indenture or in any supplemental indenture; provided,
that, such action shall not as evidenced by an Opinion of Counsel delivered to
the Indenture Trustee, adversely affect the interests of the Holders in any
material respect;

 

(vi)          to evidence and
provide for the acceptance of the appointment hereunder by a successor trustee
with respect to the Notes and to add to or change any of the provisions of this
Indenture as shall be necessary to facilitate the administration of the trusts
hereunder by more than one trustee, pursuant to the requirements of Article VI;

 

(vii)         to add to the
conditions, limitations and restrictions on the authorized amount, terms and
purposes of the issuance, authentication and delivery of any of the Notes, as
herein set forth, additional conditions, limitations and restrictions thereafter
to be observed;

 

(viii)        to modify the
restrictions on and procedures for resales and other transfers of the Notes to
reflect any changes in Applicable Law or regulations (or the interpretation
thereof) or to enable the Issuer or the Indenture Trustee to rely upon the
exemption from registration under the Securities Act or the Investment Company
Act or to remove restrictions on resale or transfer to the extent required
hereunder; and

 

(ix)           to evidence or
implement any change to this Indenture required by regulations or guidelines
enacted to comply with the USA PATRIOT Act.

 

The
Indenture Trustee is hereby authorized to join in the execution of any such
supplemental indenture and to make any further appropriate agreements and
stipulations that may be therein contained.

 

(b)           The Issuer and the Indenture Trustee,
when authorized by an Issuer Order, may, also without the consent of any of the
Holders of the Notes but with the receipt of written confirmation from each
Rating Agency then rating the Notes that such Act of the Holders will not
result in a downgrade, withdrawal or qualification of the ratings then assigned
to the Notes, enter into an indenture or indentures supplemental hereto for the
purpose of adding any provisions to, or changing in any manner or eliminating
any of the provisions of, this Indenture or of modifying in any manner the
rights of the Holders of the Notes under this Indenture; provided, however,
that such action shall not, as evidenced by an Opinion of Counsel,
(i) adversely affect in any material respect the interest of any Holder,
(ii) cause the Issuer to be subject to an entity level tax or be
classified as a taxable mortgage pool within the meaning of Section 7701(i) of
the Code, or (iii) cause the Issuer to violate the provisions of Sections
7 or 9(i) of its Limited Liability Company Agreement.

 

53

 

(c)           Notwithstanding any provision
contained herein to the contrary, prior to entering into any supplemental
indenture pursuant to Section 9.01,  the Issuer and
Indenture Trustee shall (i) obtain written confirmation
from Moody’s that entry by the Issuer and Indenture Trustee into such
supplemental indenture satisfies the Moody’s Rating Condition, and
(ii) obtain written confirmation from S&P that entry by the
Issuer and Indenture Trustee into such supplemental indenture satisfies the
S&P Rating Condition.

 

Section 9.02.   Supplemental Indentures
With Consent of Holders.

 

The
Issuer and the Indenture Trustee, when authorized by an Issuer Order, also may,
with the consent of the Majority Holders by Act of such Holders and upon the
receipt of written confirmation from each Rating Agency rating
the Notes that such Act of the Holders will not result in a downgrade,
withdrawal or qualification of the ratings then assigned to the Notes, enter
into an indenture or indentures supplemental hereto for the purpose of
adding any provisions to, or changing in any manner or eliminating
any of the provisions of, this Indenture or of modifying in any manner the
rights of the Holders of the Notes under this Indenture; provided, however,
that (x) that the Issuer shall only enter into an indenture
supplemental hereunder in compliance with the terms of the Limited Liability
Company Agreement, and (y) no such supplemental indenture shall, without
the consent of the Holder of each Note affected thereby:

 

(i)            change the date of
payment of principal of or interest on any Note, or reduce the principal
balance thereof or the interest rate thereon with respect thereto, change the
provisions of this Indenture relating to the application of collections on, or
the proceeds of the sale of the Indenture Collateral to payment of principal of
or interest on the Notes, or change any place of payment where, or the coin or currency
in which, any Note or the interest thereon is payable, or impair the right to
institute suit for the enforcement of the provisions of this Indenture
requiring the application of funds available therefor, as provided in Article V, to the payment
of any such amount due on the Notes on or after the respective due dates
thereof;

 

(ii)           change any of the
terms of the Guaranty;

 

(iii)          reduce the
percentage of the Aggregate Outstanding Principal Balance, the consent of the
Holders of which is required for any such supplemental indenture, or the
consent of the Holders of which is required for any waiver of compliance with
any provision of this Indenture or defaults hereunder and their consequences
provided for in this Indenture;

 

(iv)          modify or alter the
provisions of the proviso to the definition of the term “Outstanding” or modify
or alter the exception in the definition of the term “Holder”;

 

(v)           reduce the
percentage of the Aggregate Outstanding Principal Balance required to direct
the Indenture Trustee to direct the Issuer to sell or liquidate the Indenture
Collateral pursuant to Section 5.04;

 

(vi)          modify any provision
of this Section 9.02 except to increase any percentage specified
herein or to provide that certain additional provisions of this

 

54

 

Indenture
or the Transaction Documents cannot be modified or waived without the consent
of the Holder of each Note affected thereby; or

 

(vii)         permit the creation of
any lien ranking prior to or on a parity with the lien of this
Indenture with respect to any part of the Indenture Collateral or, except as otherwise
permitted or contemplated herein, terminate the lien of this Indenture on any property at any
time subject hereto or deprive any Holder of the security provided by the lien of this
Indenture; and provided, further, that such action shall not, as
evidenced by an Opinion of Counsel, cause the Issuer to be subject to an entity
level tax or be classified as a taxable mortgage pool within the meaning of
Section 7701(i) of the Code.

 

The
Indenture Trustee may in its discretion determine whether or not any Notes
would be affected by any supplemental indenture and any such determination
shall be conclusive upon the Holders of all Notes, whether theretofore or
thereafter authenticated and delivered hereunder. The Indenture Trustee shall
not be liable for any such determination made in good faith.

 

It
shall not be necessary for any Act of Holders under this Section 9.02
to approve the particular form of any proposed supplemental indenture, but it
shall be sufficient if such Act shall approve the substance thereof.

 

Promptly
after the execution by the Issuer and the Indenture Trustee of any supplemental
indenture pursuant to this Section 9.02, the Indenture Trustee
shall mail to the Holders of the Notes to which such amendment or supplemental
indenture relates a copy of such supplemental Indenture or a notice setting
forth in general terms the substance of such supplemental indenture. Any failure of
the Indenture Trustee to mail such notice, or any defect therein, shall not, however,
in any way impair or affect the validity of any such supplemental indenture.

 

Notwithstanding
any provision contained herein to the contrary, prior to entering into any
supplemental indenture pursuant to Section 9.02, the Issuer and
Indenture Trustee shall obtain written confirmation from each of Moody’s and
S&P that entry by the Issuer and Indenture Trustee into such supplemental
indenture satisfies the Moody’s Rating Condition and the S&P Rating
Condition, respectively.

 

Section 9.03.   Execution of Supplemental
Indentures.

 

In
executing, or permitting the additional trusts created by, any supplemental
indenture permitted by this Article IX or the modification thereby
of the trusts created by this Indenture, the Indenture Trustee shall be
entitled to receive, and subject to Sections 6.01 and 6.02, shall
be fully protected in relying upon, an Opinion of Counsel stating that the
execution of such supplemental indenture is authorized or permitted by this
Indenture. The Indenture Trustee may, but shall not be obligated to, enter into
any such supplemental indenture that affects the Indenture Trustee’s own
rights, duties, liabilities or immunities under this Indenture or otherwise.
The Indenture Trustee shall provide copies of each supplemental indenture to
the Rating Agencies.

 

55

 

Section 9.04.   Effect of Supplemental Indenture.

 

Upon
the execution of any supplemental indenture pursuant to the provisions hereof,
this Indenture shall be and shall be deemed to be modified and amended in
accordance therewith with respect to the Notes affected thereby, and the
respective rights, limitations of rights, obligations, duties, liabilities and
immunities under this Indenture of the Indenture Trustee, the Issuer and the
Holders shall thereafter be determined, exercised and enforced hereunder subject
in all respects to such modifications and amendments, and all the terms and
conditions of any such supplemental indenture shall be and be deemed to be part
of the terms and conditions of this Indenture for any and all purposes.

 

Section 9.05.   Reference in Notes to Supplemental Indentures.

 

Notes
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article IX may, and if required by the Indenture Trustee
shall, bear a notation in form approved by the Indenture Trustee as to any
matter provided for in such supplemental indenture. If the Issuer or the
Indenture Trustee shall so determine, new Notes so modified as to conform, in
the opinion of the Indenture Trustee and the Issuer, to any such supplemental
indenture may be prepared and executed by the Issuer and authenticated and
delivered by the Indenture Trustee in exchange for Outstanding Notes.

 

Section 9.06.   Amendment of this Indenture Generally.

 

The
parties acknowledge and agree that this Indenture may only be amended, modified
or restated through the execution of a Supplemental Indenture pursuant to the
terms of this Article IX.

 

ARTICLE X          MISCELLANEOUS

 

Section 10.01.   Compliance Certificates and Opinions, etc.

 

Upon
any application or request by the Issuer to the Indenture Trustee to take any
action under any provision of this Indenture (including a notice of redemption
under Section 4.04), the Issuer shall furnish to the Indenture
Trustee an Officer’s Certificate stating that all conditions precedent, if any,
provided for in this Indenture relating to the proposed action have been
complied with, and, if required, an Opinion of Counsel stating that in the
opinion of such counsel all such conditions precedent, if any, have been
complied with, except that, in the case of any such application or request as
to which the furnishing of such documents is specifically required by any
provision of this Indenture, no additional certificate or opinion need be
furnished.

 

Every
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture shall include:

 

(a)           a statement that each signatory of
such certificate or opinion has read or has caused to be read such covenant or
condition and the definitions herein relating thereto;

 

(b)           a brief statement as to the nature
and scope of the examination or investigation upon which the statements or
opinions contained in such certificate or opinion are based;

 

56

 

(c)           a statement that, in the opinion
of each such signatory, such signatory has made such examination or
investigation as is necessary to enable such signatory to express an informed
opinion as to whether or not such covenant or condition has been complied with;

 

(d)           a statement as to whether, in the
opinion of each such signatory, such condition or covenant has been complied
with; and

 

(e)           if the signer of document is required
to be Independent, the Statement required by the definition of the term “Independent”.

 

Section 10.02.   Form of Documents Delivered to Indenture Trustee.

 

In
any case where several matters are required to be certified by, or covered by
an opinion of, any specified Person, it is not necessary that all such matters
be certified by, or covered by the opinion of, only one such Person, or that
they be so certified or covered by only one document, but one such Person may
certify or give an opinion with respect to some matters and one or more other
such Persons as to other matters, and any such Person may certify or give an
opinion as to such matters in one or several documents.

 

Any
certificate or opinion of an Authorized Officer of the Issuer may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows that the certificate or
opinion or representations with respect to the matters upon which the
certificate or opinion is based are erroneous. Any such certificate of an
Authorized Officer or Opinion of Counsel may be based, insofar as it relates to
factual matters, upon a certificate or opinion of, or representations by, an
officer or officers of an appropriate Person stating that the information with
respect to such factual matters is in the possession of the such Person, unless
such counsel knows that the certificate or opinion or representations with
respect to such matters are erroneous.

 

Where
any Person is required to make, give or execute two or more applications,
requests, consents, certificates, statements, opinions or other instruments
under this Indenture, they may, but need not, be consolidated and form one
instrument.

 

Whenever
in this Indenture, in connection with any application or certificate or report
to the Indenture Trustee, it is provided that the Issuer shall deliver any
document as a condition of the granting of such application, or as evidence of
the Issuer’s compliance with any term hereof, it is intended that the truth and
accuracy in all material respects, at the time of the granting of such
application or at the effective date of such certificate or report (as the case
may be), of the facts and opinions stated in such document shall in such case
be conditions precedent to the right of the Issuer to have such application
granted or to the sufficiency of such certificate or report. The foregoing
shall not, however, be construed to affect the Indenture Trustee’s right to
rely upon the truth and accuracy of any statement or opinion contained in any
such document as provided in Article VI.

 

Section 10.03.   Acts of Holders.

 

(a)           Any request, demand, authorization,
direction, notice, consent, waiver or other action provided by this Indenture
to be given or taken by Holders may be embodied in and

 

57

 

evidenced
by one or more instruments of substantially similar tenor signed by such
Holders in person or by agents duly appointed in writing; and except as herein
otherwise expressly provided such action shall become effective when such
instrument or instruments are delivered to the Indenture Trustee, and, where it
is hereby expressly required, to the Issuer. Such instrument or instruments
(and the action embodied therein and evidenced thereby) are herein sometimes
referred to as the “Act” of the Holders signing such instrument or instruments.
Proof of execution of any such instrument or of a writing appointing any such
agent shall be sufficient for any purpose of this Indenture and (subject to Section 6.01)
conclusive in favor of the Indenture Trustee and the Issuer, if made in the
manner provided in this Section 10.03.

 

(b)           The fact and date of the execution by
any person of any such instrument or writing may be proved in any manner that
the Indenture Trustee deems sufficient.

 

(c)           The ownership of Notes shall be
proved by the Note Register.

 

(d)           Any request, demand, authorization,
direction, notice, consent, waiver or other action by the Holder of any Notes
shall bind the Holder of every Note issued upon the registration thereof or in
exchange therefor or in lieu thereof, in respect of anything done, omitted or
suffered to be done by the Indenture Trustee or the Issuer in reliance thereon,
whether or not notation of such action is made upon such Note.

 

Section 10.04.   Notices,
etc., to Indenture Trustee and Others.

 

Any
request, demand, authorization, direction, notice, consent, waiver or Act of
Holders or other documents provided or permitted by this Indenture shall be in
writing and if such request, demand, authorization, direction, notice, consent,
waiver or act of Holders is to be made upon, given or furnished to or filed
with:

 

(i)                 the
Indenture Trustee by any Holder or by the Issuer shall be sufficient for every
purpose hereunder if made, given, furnished or filed in writing to or with the
Indenture Trustee and received at the Corporate Trust Office, or

 

(ii)                the
Issuer by the Indenture Trustee or by any Holder shall be sufficient for every
purpose hereunder if in writing and mailed first–class, postage prepaid to the
Issuer addressed to: OMX Timber Finance Investments I, LLC, 150 Pierce Road,
Itasca, IL 60143, Attention: Executive Vice-President and Chief Financial
Officer, or at any other address previously furnished in writing to the
Indenture Trustee by the Issuer. The Issuer shall promptly transmit any notice
received by it from the Holders to the Indenture Trustee.

 

Notices
required to be given to the Rating Agencies by the Issuer or the Indenture
Trustee shall be in writing, personally delivered or mailed by certified mail,
return receipt requested, to (i) in the case of S&P, at the following
address: Standard and Poor’s Ratings Services, 55 Water Street, 41st Floor, New
York, New York 10007, Attention: ABS Surveillance Group, and (ii) in the
case of Moody’s, at the following address: Moody’s Investors Service, 99 Church
Street, 4th Floor, New York, New York 10007, Attention: Monitoring Group -
Asset Finance Group; or as to each of the foregoing, at such other address as
shall be designated by written notice to the

 

58

 

other
parties; provided, however, that no notice
shall be required to be given to the Rating agencies until the
Notes has been rated by such Rating Agency.

 

Section 10.05.   Notices
to Holders; Waiver.

 

Where
this Indenture provides for notice to Holders of any event, such notice shall
be sufficiently given (unless otherwise herein expressly provided) if in
writing and mailed, by nationally recognized overnight courier or by first–class,
postage prepaid to each Holder affected by such event, at his address as it
appears on the Note Register, not later than the latest date, and not earlier
than the earliest date, prescribed for the giving of such notice. In any case
where notice to Holders is given by mail, neither the failure to mail such
notice nor any defect in any notice so mailed to any particular Holder shall
affect the sufficiency of such notice with respect to other Holders, and any
notice that is mailed in the manner herein provided shall conclusively be
presumed to have been duly given.

 

Where
this Indenture provides for notice in any manner, such notice may be waived in
writing by any Person entitled to receive such notice, either before or after
the event, and such waiver shall be the equivalent of such notice. Waivers of
notice by Holders shall be filed with the Indenture Trustee but such filing
shall not be a condition precedent to the validity of any action taken in
reliance upon such a waiver.

 

In
case, by reason of the suspension of regular mail service as a result of a
strike, work stoppage or similar activity, it shall be impractical to mail
notice of any event to Holders when such notice is required to be given
pursuant to any provision of this Indenture, then any manner of giving such
notice as shall be satisfactory to the Indenture Trustee shall be deemed to be
a sufficient giving of such notice.

 

Where
this Indenture provides for notice to the Rating Agencies, failure to give such
notice shall not affect any other rights or obligations created hereunder, and
shall not under any circumstance constitute an Event of Default.

 

Section 10.06.   Alternate
Payment and Notice Provisions.

 

Notwithstanding
any provision of this Indenture or any of the Notes to the contrary, the Issuer
may enter into any agreement with any Holder of a Note providing for a method
of payment, or notice by the Indenture Trustee or any Paying Agent to such
Holder, that is different from the methods provided for in this Indenture for
such payments or notices. The Issuer will furnish to the Indenture Trustee a
copy of each such agreement and the Indenture Trustee will cause payments to be
made and notices to be given in accordance with such agreements.

 

Section 10.07.   Effect
of Headings.

 

The
Article and Section headings herein are for convenience only and
shall not affect the construction hereof.

 

59

 

Section 10.08.   Successors and Assigns.

 

All
covenants and agreements in this Indenture and the Notes by the Issuer shall
bind its successors and assigns, whether so expressed or not. All agreements of
the Indenture Trustee in this Indenture shall bind its successors, co-trustees
and agents.

 

Section 10.09.   Severability.

 

In
case any provision in this Indenture or in the Notes shall be invalid, illegal
or unenforceable, the validity, legality, and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.

 

Section 10.10.   Benefits of Indenture.

 

Nothing
in this Indenture or in the Notes, express or implied, shall give to any
Person, other than the parties hereto and their successors hereunder, and the
Holders, and any other party secured hereunder, and any other Person with an
ownership interest in any part of the Indenture Collateral, any benefit or any
legal or equitable right, remedy or claim under this Indenture.

 

Section 10.11.   Legal Holidays.

 

In
any case where the date on which any payment is due shall not be a Business
Day, then (notwithstanding any other provision of the Notes or this
Indenture) payment need not be made on such date, but may be made on the next
succeeding Business Day with the same force and effect as if made on the date
on which nominally due, and no interest shall accrue for the period from and
after any such nominal date.

 

Section 10.12.   GOVERNING LAW.

 

(a)              THIS INDENTURE,
EACH SUPPLEMENT AND THE NOTES SHALL BE CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF
LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

 

(b)              EACH PARTY HERETO
HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING
OUT OF, UNDER OR IN CONNECTION WITH THIS INDENTURE. Each party hereto (i) certifies
that no representative, agent or attorney of any other party has represented,
expressly or otherwise, that such other party would not, in the event of
litigation, seek to enforce the foregoing waiver and (ii) acknowledges
that it and the other parties hereto have been induced to enter into this
Indenture by, among other things, the mutual waivers and certifications in this
subsection 11.12(b).

 

60

 

Section 10.13.   Counterparts.

 

This
Indenture may be executed in any number of counterparts (including by
facsimile), each of which so executed shall be deemed to be an original, but
all such counterparts shall together constitute but one and the same
instrument.

 

Section 10.14.   Issuer Obligation.

 

No
recourse may be taken, directly or indirectly, with respect to the obligations
of the Issuer or the Indenture Trustee on the Notes or
under this Indenture or any certificate or other writing delivered in
connection herewith or therewith, against (i) the Indenture Trustee in its
individual capacity, (ii) any owner of a beneficial interest in the Issuer
or (iii) any partner, owner, beneficiary, agent, officer, director,
employee or agent of the Indenture Trustee in its individual capacity, any
holder of a beneficial interest in the Issuer or the Indenture Trustee or of
any successor or assign of the Indenture Trustee in its individual capacity,
except as any such Person may have expressly agreed (it being understood that
the Indenture Trustee has no such obligations in their individual capacity) and
except that any such partner, owner or beneficiary shall be fully liable, to
the extent provided by applicable law, for any unpaid consideration for stock,
unpaid capital contribution or failure to pay any installment or call owing to
such entity. For all purposes of this Indenture, in the performance of any
duties or obligations of the Issuer hereunder shall be subject to, and entitled
to the benefits of, the terms and provisions of the Limited
Liability Company Agreement.

 

Section 10.15.   No Petition.

 

(a)              The Indenture
Trustee, by entering into this Indenture, and each Holder, by accepting a Note,
hereby covenant and agree that they will not prior to the date which is one
year and one day or, if longer, the preference period then in effect after
payment in full of the Notes rated by any Rating Agency, institute against the
Issuer, or join in any institution against the Issuer of, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or other
proceedings under any United States federal or state bankruptcy or similar law
in connection with any obligations relating to the Notes, this Indenture or any
of the Transaction Documents.

 

(b)              Notwithstanding
any other provisions of the Notes, this Indenture or any other Transaction
Document, the obligations of the Issuer under the Notes and this Indenture and
any other Transaction Document are limited recourse obligations of the Issuer
payable solely from the Indenture Collateral and, following realization of the
Indenture Collateral and distribution, any claims of the Holders and the other
Secured Parties, and any other parties to any Transaction Document shall be
extinguished. No recourse shall be had against any officer, administrator,
member, director, employee, security holder or incorporator of the Issuer or
their respective successors or assigns for the payment of any amounts payable
under the Notes, this Indenture or any other Transaction Document. It is understood
that the foregoing provisions of this Section 10.15(b) shall not (i) prevent
recourse to the Indenture Collateral for the sums due or to become due under
any security, instrument or agreement which is part of the Indenture Collateral
or (ii) constitute a waiver, release or discharge of any indebtedness or
obligation evidenced by the Notes or secured by this Indenture or payable under
any other Transaction Document until such

 

61

 

Indenture
Collateral has been realized and distributed, whereupon any such outstanding
indebtedness or obligation shall be extinguished.

 

Section 10.16.   Inspection; Confidentiality.

 

The
Issuer agrees that, on reasonable prior notice, it will permit any
representative of the Indenture Trustee, during the Issuer’s normal business
hours, and in a manner that does not unreasonably interfere with the Issuer’s
normal operations, to examine all the books of account, records, reports and
other papers of the Issuer, to make copies and extracts therefrom, to cause
such books to be audited by Independent certified public accountants, and to
discuss the Issuer’s affairs, finances and accounts with the Issuer’s officers,
employees, and Independent certified public accountants, all at such reasonable
times, in such reasonable manner, and as often as may be reasonably requested.
The Indenture Trustee shall and shall cause its representatives, its legal
counsel and its auditors to hold in confidence all such information except to
the extent disclosure may be required by law (and all reasonable applications
for confidential treatment are unavailing) and except to the extent that the
Indenture Trustee may reasonably determine that such disclosure is consistent
with its obligations hereunder and under applicable law. Notwithstanding
anything to the contrary contained herein, all parties to which this Indenture
relates may disclose to any and all persons, without limitation of any kind,
the tax treatment and tax structure of the transaction and all materials of any
kind (including opinions or other tax analyses) that are provided to such
investors relating to such tax treatment and tax structure. For purposes of
this paragraph, the terms “tax treatment” and “tax structure” have the meaning
given to such terms under Treasury Regulation section 1.6011-4(c).

 

62

 

IN WITNESS WHEREOF,  the Issuer and the Indenture
Trustee have caused their names to be signed hereto by their respective
officers thereunto duly authorized, all as of the day and year first above
written.

 

	
   

  	
  OMX
  TIMBER FINANCE INVESTMENTS I,

  LLC, a Delaware limited liability company

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Ted Crumley

  
	
   

  	
   

  	
  Ted
  Crumley, Regular Manager

  
				

 

Indenture
Signature Pages

OMX
Timber Finance Investments I, LLC

 

 

	
  STATE
  OF IDAHO

  	
  )

  
	
   

  	
  )
  ss.:

  
	
  COUNTY
  OF ADA

  	
  )

  

 

On
this 8th day of December, 2004, before me personally
appeared TED CRUMLEY, to me known, who being by me duly sworn, did depose and
say that he resides at, Boise, Idaho, that he is the Regular Manager of the
Issuer, the limited liability company described in and which executed the above
instrument; and that he signed his name thereto by like order.

 

	
   

  	
  /s/
  Cherie H. Anderson

  
	
   

  	
  Notary
  Public for Idaho

  
	
   

  	
  Residing
  at Meridian, Idaho

  
	
   

  	
  My
  Comission expires: 8/5/09

  

 

Signature
Pages

OMX
Timber Finance Investments I, LLC

 

 

IN WITNESS WHEREOF, the Issuer and the
Indenture Trustee have caused their names to be signed hereto by their
respective officers thereunto duly authorized, all as of the day and year first above
written.

 

	
   

  	
  WELLS
  FARGO BANK NORTHWEST, N.A., 

  not in its individual capacity but solely as the

  Indenture Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Val T. Orton

  
	
   

  	
  Name:

  	
  Val
  T. Orton

  
	
   

  	
  Title:

  	
  Vice
  President

  
					

 

Indenture
Signature Pages

OMX
Timber Finance Investments I, LLC

 

 

	
  STATE
  OF Utah

  	
  )

  
	
   

  	
  )
  ss.:

  
	
  COUNTY
  OF Salt Lake

  	
  )

  

 

On
this December 8, 2004, before me personally appeared Val T.
Orton, to me known, who being by me duly sworn, did depose and say, that he
resides at Salt Lake City and that he is the Vice President of the
Indenture Trustee, one of the entities described in and which executed the
above instrument; and that he signed his name thereto by like order.

 

	
   

  	
  /s/
  SHARLEE HACKWORTH

  
	
   

  	
  Notary
  Public

  
	
   

  	
   

  
	
   

  	
  NOTARY
  PUBLIC

  SHARLEE
  HACKWORTH

  299
  S Main Street, 12th Floor

  Salt
  Lake City, UT 84111 

  My
  Commission Expires Dec 4, 2007

  State
  of Utah

  

 

Indenture
Signature Pages

OMX
Timber Finance Investments I, LLC

 

 

EXHIBIT A

 

[FORM OF CLASS A-1 NOTE]

 

CLASS A-1 NOTE

 

THIS
NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES OR BLUE
SKY LAW OF ANY STATE. THE HOLDER HEREOF, BY PURCHASING THIS NOTE, AGREES THAT
THIS NOTE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY
IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER REQUIREMENTS OF LAWS AND ONLY (1) PURSUANT
TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”) TO A U.S. PERSON
THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN
THE MEANING OF RULE 144A (A “QIB”), AND WHO IS ALSO A QUALIFIED PURCHASER
WITHIN THE MEANING OF SECTION 3(c)(7) UNDER THE INVESTMENT COMPANY
ACT OF 1940, AS AMENDED (A “QUALIFIED 
PURCHASER”), PURCHASING FOR ITS OWN ACCOUNT OR A QIB PURCHASING FOR
THE ACCOUNT OF A QIB WHO IS ALSO A QUALIFIED PURCHASER, WHOM THE HOLDER HAS
INFORMED THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A, (2) IN CERTIFICATED FORM TO A U.S. PERSON WHO
IS AN INSTITUTIONAL “ACCREDITED INVESTOR” (WITHIN THE MEANING OF RULE 501
(a)(1)—(3) OR (7) UNDER THE SECURITIES ACT) WHO IS ALSO A QUALIFIED
PURCHASER, PURCHASING FOR INVESTMENT AND NOT FOR DISTRIBUTION IN VIOLATION OF
THE SECURITIES ACT, IN EACH CASE, SUBJECT TO (A) THE RECEIPT BY THE
INDENTURE TRUSTEE OF A LETTER SUBSTANTIALLY IN THE FORM PROVIDED IN THE
INDENTURE AND (B) THE RECEIPT BY THE INDENTURE TRUSTEE OF SUCH OTHER
EVIDENCE ACCEPTABLE TO THE INDENTURE TRUSTEE THAT SUCH REOFFER, RESALE, PLEDGE
OR TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER REQUIREMENTS OF
LAWS OR IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE
UNITED STATES AND SECURITIES AND BLUE SKY LAWS OF ANY STATE OF THE UNITED
STATES AND ANY OTHER APPLICABLE JURISDICTION, OR (3) TO A U.S. PERSON
PURSUANT TO ANOTHER EXEMPTION AVAILABLE UNDER THE SECURITIES ACT AND IN
ACCORDANCE WITH ANY APPLICABLE STATE SECURITIES LAWS. THE PURCHASE OF THIS NOTE
WILL BE DEEMED A REPRESENTATION BY THE ACQUIRER THAT EITHER: (I) IT IS
NOT, AND IS NOT ACQUIRING OR HOLDING THIS NOTE, DIRECTLY OR INDIRECTLY, ON
BEHALF OF OR WITH ANY ASSETS OF, AN “EMPLOYEE BENEFIT PLAN” WITHIN THE MEANING
OF SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED (“ERISA”), THAT IS SUBJECT TO TITLE I OF ERISA, A
“PLAN” WITHIN THE MEANING OF AND SUBJECT TO SECTION 4975 OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED (THE “CODE”); AN ENTITY THE UNDERLYING
ASSETS OF WHICH ARE DEEMED TO INCLUDE ASSETS OF ANY SUCH PLAN, OR A PLAN THAT
IS SUBJECT TO ANY FEDERAL, STATE, LOCAL OR NON-U.S. LAW (“SIMILAR LAW”)
THAT IS SUBSTANTIVELY SIMILAR TO THE PROVISIONS OF SECTION 406 OF ERISA OR
SECTION 4975 OF THE CODE, OR

 

A-1

 

(B) ITS
ACQUISITION AND HOLDING OF THIS NOTE WILL NOT CONSTITUTE OR RESULT IN A
NON-EXEMPT PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975
OF THE CODE OR A VIOLATION OF SIMILAR LAW.

 

[IF HELD BY DTC] [UNLESS THIS
NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]

 

A-2

 

	
  REGISTERED

  	
  $                        

  
	
  No.
  A–1–

  	
  December [    ], 2004

  

 

SEE REVERSE FOR CERTAIN DEFINITIONS

 

	
   

  	
  [144A
  CUSIP
  NO.                     ]

  

 

OMX
TIMBER FINANCE INVESTMENTS I, LLC, a limited liability company organized and
existing under the laws of the State of Delaware (herein referred to as the “Issuer”),
for value received, hereby promises to pay to
                     
, or registered assigns, the principal sum of                     
DOLLARS payable on October 31, 2019, or on January 29, 2020, if
extended pursuant to Section 4.04 of the
Indenture (such date, the “Maturity Date”). The unpaid
principal balance of this Note shall bear interest at a rate of [                ]% per annum (the “Note Interest Rate”), calculated based on twelve
30-day months in a 360-day year. Interest on the unpaid principal balance shall
be due and payable on each April 30 and October 31, beginning April 30,
2005, through and until the Maturity Date (each, a “Payment
Date”). If the Maturity Date is extended pursuant to Section 4.04 of the Indenture, in consideration of such
extension, the Note Interest Rate shall be increased (for the period beginning
on October 31, 2019, and extending to January 29, 2020) to a rate of
interest (the “Extension Note Interest Rate”) which is the
greater of (i) the Class A-1 Note Interest Rate plus two hundred
(200) basis points (2.00%) and (ii) a rate per annum equal to the
lesser of (A) LIBOR plus [        ] basis points ([      ]%)and (B) thirteen (13.00%). This Note is not subject to
prepayment at the Issuer’s option prior to the Maturity Date.

 

The
principal of and interest on this Note are payable in such coin or currency of
the United States as at the time of payment is legal tender for payment of
public and private debts. All payments made by the Issuer with respect to this
Note shall be applied in accordance with Section 8.02 of the
Indenture.

 

Reference
is made to the further provisions of this Note set forth on the reverse hereof,
which shall have the same effect as though fully set forth on the face of this
Note.

 

Unless
the certificate of authentication hereon has been executed by the Indenture
Trustee whose name appears below by manual signature, this Note shall not be
entitled to any benefit under the Indenture referred to on the reverse hereof,
or be valid or obligatory for any purpose.

 

A-3

 

IN
WITNESS WHEREOF, the Issuer has caused this instrument to be signed, manually
or in facsimile, by its Responsible Officer as of the date set forth above.

 

	
   

  	
  OMX
  TIMBER FINANCE INVESTMENTS I, 

  LLC,  a Delaware limited liability company

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					

 

INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

This
is one of the Notes of OMX Timber Finance Investments I, LLC designated above
and referred to in the within–mentioned Indenture.

 

	
   

  	
  WELLS
  FARGO BANK NORTHWEST, N.A., 

  not in its individual capacity but solely as Indenture 

  Trustee,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Authorized Signatory

  

 

A-4

 

[REVERSE OF NOTE]

 

This Note is one of a duly authorized issue of Notes
of the Issuer, designated as its OMX Timber Finance Investments I, LLC Notes
due 2019 (herein called the “Notes”), all issued under an Indenture,
dated as of December 21, 2004 (such indenture, as supplemented or amended,
is herein called the “Indenture”), between the Issuer and Wells Fargo
Bank Northwest, N.A., as indenture trustee (the “Indenture Trustee”, which
term includes any successor Indenture Trustee under the Indenture), to which
Indenture and all indentures supplemental thereto reference is hereby made for
a statement of the respective rights and obligations thereunder of the Issuer,
the Indenture Trustee and the Holders of the Notes. The Notes are subject to
all terms of the Indenture. All terms used in this Note that are defined in the
Indenture, as supplemented or amended, shall have the meanings assigned to them
in or pursuant to the Indenture, as so supplemented or amended.

 

Notwithstanding the foregoing, the entire unpaid
principal balance of the Notes shall be due and payable on the date on which an
Event of Default shall have occurred and be continuing and the Indenture
Trustee or the Majority Holders have declared the Notes to be immediately due
and payable in the manner provided in Section 5.02 of the
Indenture. All principal payments on the Notes shall be made pro rata to the
Holders entitled thereto.

 

Each Holder by acceptance of a Note covenants and
agrees that no recourse may be taken, directly or indirectly, with respect to
the obligations of the Issuer under the Indenture on the Notes or under any
certificate or other writing delivered in connection therewith, against the
Indenture Trustee in its individual capacity.

 

On each Payment Date, commencing April 30,
2005, the Indenture Trustee or Paying Agent shall distribute to the Person in
whose name this Note is registered at the close of business on the Record Date
the interest and principal due on this Note.

 

During each Interest Accrual Period, this Note will
bear interest at the Note Interest Rate, provided that for the period beginning
on October 31, 2019, and extending to January 29, 2020, this Note
will bear interest at the Extension Note Interest Rate.

 

Distributions on this Note will be made by the
Indenture Trustee or Paying Agent by wire transfer or, if no account
information is provided, by check mailed to the address of the Person entitled
thereto as such name and address shall appear on the Note Register or, upon
written request to the Indenture Trustee, by wire transfer of immediately
available funds to the account of the Person entitled thereto as shall appear
on the Note Register without the presentation or surrender of this Note or the
making of any notation thereon, at a bank or other entity having appropriate
facilities therefor, and, in the case of wire transfers, at the expense of such
Person unless such Person shall own of record Notes which have principal
balances aggregating at least $500,000.

 

Notwithstanding the above, the final distribution on
this Note, whether upon the Scheduled Maturity Date or the Extended Maturity
Date, as applicable, will be made after due notice by the Indenture Trustee of
the pendency of such distribution and only upon presentation

 

A-5

 

and
surrender of this Note at the office or agency maintained for that purpose by
the Note Registrar in New York, New York.

 

As
provided in the Indenture, deposits and withdrawals from the Class A-1
Notes Account may be made by the Indenture Trustee from
time to time for purposes other than distributions to the Holders
pursuant to the terms of Section 8.02 of the
Indenture.

 

As
provided in the Indenture and subject to certain limitations therein set forth,
the transfer of this Note is registrable in the Note Register upon surrender of
this Note for registration of transfer at the offices or agencies maintained by
the Note Registrar in New York, New York, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to, the Indenture Trustee,
duly executed by the holder hereof or such holder’s attorney duly authorized in
writing, and thereupon one or more new Notes in authorized denominations
evidencing the same aggregate principal balance will be issued to the
designated transferee or transferees.

 

The
Note is issuable only as a registered Note. As provided in the Indenture and
subject to certain limitations therein set forth, the Note is exchangeable for
a new Note evidencing the same undivided ownership interest, as requested by
the holder surrendering the same.

 

No
service charge will be made for any such registration of transfer or exchange,
but the Note Registrar may require payment of a sum sufficient to cover any tax
or other governmental charge payable in connection therewith.

 

The
Indenture Trustee and any agent of the Indenture Trustee may treat the person
in whose name this Note is registered as the owner hereof for all purposes, and
none of the foregoing shall be affected by notice to the contrary.

 

The
obligations and responsibilities created by the Indenture shall terminate upon
the payment to Holders of all amounts required to be paid to them pursuant to
the Indenture and the other Transaction Documents and the disposition of all of
the Indenture Collateral pursuant to the terms of Section 4.06 of the
Indenture.

 

A-6

 

SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE(1)

 

The following exchanges of a part of this Global Note for
an interest in another Global Note or for an Individual
Note, or exchanges of a part of another Global Note or Individual Note for an interest in this Global Note, have been made:

 

	
  Date of

  Exchange

  	
   

  	
  Amount of

  decrease in

  Principal Amount

  of this Global

  Note

  	
   

  	
  Amount of

  increase in

  Principal Amount

  of this Global

  Note

  	
   

  	
  Principal Amount

  of this Global

  Note following

  such decrease (or

  increase)

  	
   

  	
  Signature of

  Responsible

  Officer of Note

  Registrar

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

(1)                 This should be included only if the Note
is issued in global form.

 

A-7

 

ASSIGNMENT

 

Social
Security or taxpayer I.D. or other identifying number of assignee

 

FOR
VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto

 

 

 

(name and address of assignee)

 

the
within Note and all rights thereunder, and hereby irrevocably constitutes and
appoints                        ,
attorney, to transfer said Note on the books kept for registration thereof,
with full power of substitution in the premises.

 

	
  Dated:

  	
   

  	
   

  	
  (2)

  

 

 

Signature Guaranteed:

 

(2)     NOTE: The
signature to this assignment must correspond with the name of the registered
owner as it  appears on the face of the
within Note in every particular, without alteration, enlargement or any change
whatsoever.

 

A-8

 

EXHIBIT B

 

WIRING INSTRUCTIONS FORM

 

, 2004

 

Wells
Fargo Bank Northwest, N.A.,

as
the Indenture Trustee and Paying Agent

299
South Main Street

12th
Floor

Salt
Lake City, Utah 84111

Attention:
Corporate Trust Services

 

Re:    OMX Timber Finance
Investments I, LLC Class A-1 Secured Notes due 2019

 

Dear
Sir:

 

In connection with the sale of the above–captioned Note by                     to
                         ,
(“Transferee”) you, as Paying Agent, are instructed to make all
remittances to Transferee as Holder as of                 ,                
by wire transfer. For such wire transfer, the wiring instructions are as
follows:

 

 

 

	
   

  	
   

  
	
   

  	
  Transferee

  

 

Holder’s
mailing address: 

Name:

Address:

 

B-1

 

EXHIBIT C-1

 

FORM OF TRANSFEREE LETTER

 

OMX Timber Finance Investments I, LLC,

as the Issuer

c/o
Office Max Incorporated

150
Pierce Road

Itasca,
IL 60143

Attention:
Executive Vice-President and Chief Financial Officer

 

Wells
Fargo Bank Northwest, N.A.,

as
the Indenture Trustee

299
South Main Street

12th
Floor

Salt
Lake City, Utah 84111

Attention:
Corporate Trust Services

 

                    ,
20   

 

Re:          OMX Timber Finance
Investments I, LLC Notes due 2019

 

Ladies
and Gentlemen:

 

In
connection with our acquisition of the above–captioned Notes, we certify that (a) we
understand that the Notes are not being registered under the Securities Act of
1933, as amended (the “Act”), or any state securities laws and are being
transferred to us in a transaction that is exempt from the registration
requirements of the Act and any such laws, (b) we are a “U.S. Person” as
defined in the Indenture pursuant to which the Notes were issued (the “Indenture”),
(c) we are an “Institutional Accredited Investor,” as defined in the
Indenture, and a “Qualified Purchaser” as defined in the Indenture, and have
such knowledge and experience in financial and business matters that we are
capable of evaluating the merits and risks of investments in the Notes, (d) we
have had the opportunity to ask questions of and receive answers from the
Issuer concerning the purchase of the Notes and all matters relating thereto or
any additional information deemed necessary to our decision to purchase the
Notes, (e) we are acquiring the Notes for investment for our own account
and not with a view to any distribution of such Notes (but without prejudice to
our right at all times to sell or otherwise dispose of the Notes in accordance
with clause (g) below), (f) we have not
offered or sold any Notes to, or solicited offers to buy any Notes from, any
person, or otherwise approached or negotiated with any person with respect
thereto, or taken any other action which would result in a violation of Section 5
of the Act, (g) we will not sell, transfer or otherwise dispose of any
Note unless (1) such sale, transfer or other disposition is made pursuant
to an effective registration statement under the Act or is exempt from such
registration requirements, and if requested, we will at our expense provide an
opinion of counsel satisfactory to the addressees of this certificate that such
sale, transfer or other disposition may be made pursuant to an exemption from
the Act, (2) the

 

C-1-1

 

purchaser
or transferee of such Note has executed and delivered to you a certificate to
substantially the same effect as this certificate if required by the Indenture,
and (3) the purchaser or transferee has otherwise complied with any
conditions for transfer set forth in the Indenture, (h) the purchaser will
comply with the provisions of Section 4.05 of the Indenture as to
treatment of the Notes under applicable tax law, and (i) the purchaser is
not, and is not acquiring or holding a Note, directly or indirectly on behalf
of or with any assets of an “employee benefit plan” within the meaning of Section 3(3) of
the Employee Retirement Income Security Act of 1974, as amended (“ERISA”) that is
subject to Title I of ERISA, a “plan” within the meaning of and subject to Section 4975
of the Internal Revenue Code of 1986, as amended (the “Code”), an entity
the underlying assets of which are deemed to include assets of any such plan,
or a plan that is subject to any federal, state, local or non-U.S. law (“Similar
Law”) that is substantively similar to the provisions of Section 406 of
ERISA or Section 4975 of the Code; or the purchaser’s acquisition and
holding of such Note will not constitute or result in a non-exempt prohibited
transaction under Section 406 of ERISA or Section 4975 of the Code or
a violation of Similar Law.

 

	
   

  	
  Very
  truly yours,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Print
  Name of Transferee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Responsible Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  cc:
  

  	
  Office
  Max Incorporated

  	
   

  
	
   

  	
  150 Pierce Road

  	
   

  
	
   

  	
  Itasca, IL 60143

  	
   

  
	
   

  	
  Attention: Executive
  Vice-President and General Counsel

  	
   

  

 

C-1-2

 

EXHIBIT C-2

 

FORM OF RULE 144A CERTIFICATION

 

OMX Timber Finance Investments I, LLC,

as the Issuer

c/o
OfficeMax Incorporated

150
Pierce Road

Itasca,
IL 60143

Attention:
Executive Vice-President and Chief Financial Officer

 

Wells
Fargo Bank Northwest, N.A.,

as the Indenture Trustee

299
South Main Street

12th
Floor

Salt
Lake City, Utah 84111

Attention:
Corporate Trust Services

 

                    ,
20    

 

Re:          OMX Timber Finance
Investments I, LLC Notes due 2019

 

Ladies
and Gentlemen:

 

In
connection with our acquisition any of the above Notes we certify that (a) we
understand that the Notes are not being registered under the Securities Act of
1933, as amended (the “Act”), or any state securities laws and are being
transferred to us in a transaction that is exempt from the registration
requirements of the Act and any such laws, (b) we have had the opportunity
to ask questions of and receive answers from the Issuer concerning the purchase
of the Notes and all matters relating thereto or any additional information
deemed necessary to our decision to purchase the Notes, (c) we have not,
nor has anyone acting on our behalf offered, transferred, pledged, sold or
otherwise disposed of the Notes, any interest in the Notes or any other similar
security to, or solicited any offer to buy or accept a transfer, pledge or
other disposition of the Notes, any interest in the Notes or any other similar
security from, or otherwise approached or negotiated with respect to the Notes,
any interest in the Notes or any other similar security with, any person in any
manner, or made any general solicitation by means of general advertising or in
any other manner, or taken any other action, that would constitute a
distribution of the Notes under the Act or that would render the disposition of
the Notes a violation of Section 5 of the Act or require registration
pursuant thereto, nor will act, nor has authorized or will authorize any person
to act, in such manner with respect to the Notes, (d) we are a U.S.
person, as defined in Regulation S under the Act, (e) we are a “qualified
institutional buyer” as that term is defined in Rule 144A under the Act
and a “qualified purchaser” within the meaning of Section 3(c)(7) of
the Investment Company Act of 1940, as amended, and have completed the form of
certification to that effect attached hereto as Annex 1, and (f) we are
not, and are not acquiring or holding the

 

C-2-1

 

Notes,
directly or indirectly on behalf of or with any assets of an “employee benefit
plan” within the meaning of Section 3(3) of the Employee Retirement
Income Security Act of 1974, as amended (“ERISA”) that is subject to
Title I of ERISA, a “plan” within the meaning of and subject to Section 4975
of the Internal Revenue Code of 1986, as amended (the “Code”), an entity
the underlying assets of which are deemed to include assets of any such plan,
or a plan that is subject to any federal, state, local or non-U.S. law (“Similar
Law”) that is substantively similar to the provisions of Section 406
of ERISA or Section 4975 of the Code; or the purchaser’s acquisition and
holding of such Note will not constitute or result in a non-exempt prohibited
transaction under Section 406 of ERISA or Section 4975 of the Code or
a violation of Similar Law. We are acquiring the Notes for our own account or
for resale pursuant to Rule 144A and further, understand that such Notes
may be resold, pledged or transferred only (i) to a person reasonably
believed to be a qualified institutional buyer that purchases for its own
account or for the account of a qualified institutional buyer to whom notice is
given that the resale, pledge or transfer is being made in reliance on Rule 144A,
or (ii) pursuant to another exemption from registration under the Act.

 

	
   

  	
  Very
  truly yours,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Print
  Name of Transferee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Responsible Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
  cc: 

  	
  Office Max Incorporated

  	
   

  
	
   

  	
  150 Pierce Road

  	
   

  
	
   

  	
  Itasca, IL 60143

  	
   

  
	
   

  	
  Attention: Executive
  Vice-President and General Counsel

  	
   

  

 

C-2-2

 

ANNEX 1 TO EXHIBIT C-2

 

[FORM OF CERTIFICATION]

 

[Date]

 

OMX Timber Finance Investments I, LLC,

as the Issuer

c/o
OfficeMax Incorporated

150
Pierce Road

Itasca,
IL 60143

Attention:
Executive Vice-President and Chief Financial Officer

 

Wells
Fargo Bank Northwest, N.A.,

as
the Indenture Trustee

299
South Main Street

12th
Floor

Salt
Lake City, Utah 84111

Attention:
Corporate Trust Services

 

                    ,
20  

 

Re:          OMX Timber Finance Investments
I, LLC Notes due 2019

 

Ladies
and Gentlemen:

 

In
connection with our purchase of the Notes, the undersigned certifies to each of
the parties to whom this letter is addressed that it is a qualified
institutional buyer (as defined in Rule 144A under the Securities Act of
1933, as amended (the “Act”)) as follows:

 

1.             It owns and/or
invests on a discretionary basis eligible securities (excluding affiliate’s
securities, bank deposit notes and CD’s, loan participations, repurchase
agreements, securities owned but subject to a repurchase agreement and
currency, interest rate and commodity swaps), as described below:

 

Amount: $                           ;
and

 

2.             The dollar
amount set forth above is:

 

a.             greater than $100 million
and the undersigned is one of the following entities:

 

C-2-3

 

	
   

  	
  (1)

  	
  o

  	
   

  	
  an insurance company as
  defined in Section 2(13) of the Act*; or

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (2)

  	
  o

  	
   

  	
  an investment company
  registered under the Investment Company Act or any business development
  company as defined in Section 2(a)(48) of the Investment Company Act of
  1940 or as defined in Section 202(a)(22) of the Investment Advisers Act
  of 1940; or

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (3)

  	
  o

  	
   

  	
  a Small Business
  Investment Company licensed by the U.S. Small
  Business Administration under Section 301(c) or (d) of the
  Small Business Investment Act of 1958; or

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (4)

  	
  o

  	
   

  	
  a plan
  (i) established and maintained by a state, its political subdivisions,
  or any agency or instrumentality of a state or its political subdivisions,
  the laws of which permit the purchase of securities of this type, for the
  benefit of its employees and (ii) the governing investment guidelines of
  which permit the purchase of securities of this type; or

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (5)

  	
  o

  	
   

  	
  a corporation (other than
  a U.S. bank, savings and loan association or equivalent foreign institution),
  partnership, Massachusetts or similar statutory or business trust, or an
  organization described in Section 501 (c)(3) of the Internal
  Revenue Code; or

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (6)

  	
  o

  	
   

  	
  a U.S. bank, savings and loan
  association or equivalent foreign institution, which has an audited net worth
  of at least $25 million as demonstrated in its latest annual financial
  statements as of a date not more than 16 months preceding the date of sale in
  the case of a U.S. institution or 18 months in the case of a foreign
  institution; or

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (7)

  	
  o

  	
   

  	
  an investment adviser
  registered under the Investment Advisers Act of 1940; or

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  b.

  	
  o

  	
   

  	
   

  	
  greater than $10 million,
  and the undersigned is a broker-dealer registered with the SEC; or

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  c.

  	
  o

  	
   

  	
   

  	
  less than $10 million, and
  the undersigned is a broker-dealer registered with the SEC and will only
  purchase Rule 144A securities in riskless principal transactions (as
  defined in Rule 144A); or

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  d.

  	
  o

  	
   

  	
   

  	
  less than $100 million,
  and the undersigned is an investment company registered under the Investment
  Company Act of 1940, which, together with one or more registered investment
  companies having the same or an affiliated investment adviser, owns at least
  $100 million of eligible securities; or

  

 

*              A  purchase by an insurance company for one or more of
its separate accounts, as defined by section 2(a)(37) of the Investment Company
Act of 1940, which
are neither registered nor required to be registered thereunder, shall be
deemed to be a purchase for the account of such insurance company.

 

D-4

 

	
  e.

  	
  o

  	
   

  	
   

  	
  less than $100 million,
  and the undersigned is an entity, all the equity owners of which are
  qualified institutional buyers.

  

 

The
undersigned further certifies that it is purchasing Notes for its own account
or for the account of others that independently qualify as “Qualified
Institutional Buyers” as defined in Rule 144A. It is aware that the sale
of the Notes is being made in reliance on its continued compliance with Rule 144A.
It is aware that the transferor may rely on the exemption from the provisions
of Section 5 of the Act provided by Rule 144A. The undersigned
understands that the Notes may be resold, pledged or transferred pursuant to Rule 144A
only to a person reasonably believed to be a Qualified Institutional Buyer that
purchases for its own account or for the account of a Qualified Institutional
Buyer to whom notice is given that the resale, pledge or transfer is being made
in reliance in Rule 144A.

 

The
undersigned agrees that if at some time before the expiration of the holding
period described in Rule 144 it wishes to dispose of or exchange any of
the Notes, it will not transfer or exchange any of the Notes to a Qualified
Institutional Buyer without first obtaining a letter in the form hereof from
the transferee and delivering such certificate to the addressees hereof.

 

The
undersigned further certifies that it is (x) a “U.S. person” as defined in
Regulation S of under the Securities Act and (y) a “qualified purchaser”
within the meaning of Section 3(c)(7) of the Investment Company Act
of 1940.

 

IN WITNESS WHEREOF, this document has been executed by the undersigned
who is duly authorized to do so on behalf of the undersigned Qualified
Institutional Buyer on the          day
of                             ,
         .

 

	
   

  	
  Name
  of Institution

  
	
   

  	
  Signature

  
	
   

  	
  Name

  
	
   

  	
  Title

  

 

	
  cc:

  	
  Office
  Max Incorporated

  
	
   

  	
  150
  Pierce Road

  
	
   

  	
  Itasca,
  IL 60143

  
	
   

  	
  Attention:
  Executive Vice-President and General Counsel

  

 

D-5

 

EXHIBIT D

 

[FORM OF REDEMPTION NOTICE]

 

[TO
EACH HOLDER]

October 1, 2019

 

Re:          OMX Timber Finance
Investments I, LLC Notes due 2019 (the “Notes”)

 

Ladies
and Gentlemen:

 

Pursuant
to the terms of Section 4.04 of the Indenture dated as of December 21,
2004, (the “Indenture”) between OMX Timber Finance Investments I, LLC,
as issuer (the “Issuer”) and Wells Fargo Bank Northwest, N.A., as
indenture trustee (the “Indenture Trustee”), this letter serves as
notice to you that, as of the date hereof:

 

[Check
one below]

 

o    We have not
received notice from the Issuer that it intends to redeem fully the captioned
Notes on the Scheduled Maturity Date (which is October 31, 2019). We are
obligated as Indenture Trustee to extend the term of the Notes to the Extended
Maturity Date (which is January 29, 2020) unless we receive instruction by
October 21, 2019, from Holders evidencing more than 50% of the Aggregate
Outstanding Principal Balance of all of the Notes not to extend such maturity.

 

o    We have
received notice from the Issuer dated September [  ], 2019, that
it intends to redeem fully the captioned Notes, together with all accrued and
unpaid interest thereon, on the Scheduled Maturity Date. In the event the Issuer
fails to so redeem the Notes on the Scheduled Maturity Date, we will be
obligated as Indenture Trustee to extend the term of the Notes to the Extended
Maturity Date (which is January 29, 2020) unless we receive instruction by
October 21, 2019, from Holders evidencing more than 50% of the Aggregate
Outstanding Principal Balance of all of the Notes not to extend such maturity
upon such failure to redeem.

 

If,
under the circumstances described above, you do not wish for the maturity of
the Notes to be extended to the Extended Maturity Date, you must notify us in
writing at the address set forth below:

 

Wells Fargo Bank Northwest, N.A.,

299 South Main Street, 12th Floor

Salt Lake City, Utah 84111

Attention: Corporate Trust Services

Reference: OMX Timber Finance Investments I, LLC Notes due 2019

 

We
must receive your notice on or before October 21, 2019.

 

In
the event that Holders evidencing more than 50% of the Aggregate Outstanding
Principal Balance of all of the Notes instruct us not to extend the maturity of
the Notes as described

 

D-1

 

above,
remedies shall be exercised pursuant to Article V of the
Indenture after the Scheduled Maturity Date.

 

Capitalized
terms used but not defined herein shall have the meanings assigned in the
Indenture.

 

	
   

  	
  WELLS
  FARGO BANK NORTHWEST, N.A.,

  not in its individual capacity but solely as the 

  Indenture Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					

 

D-2Exhibit 10.1

 

LOAN AGREEMENT

 

 

Dated as of November 27, 2006

 

 

Between

 

ART MORTGAGE BORROWER PROPCO 2006-1A L.P.

and

ART MORTGAGE BORROWER OPCO 2006-1A L.P.,

collectively, as Borrower

 

 

and

 

 

UBS REAL ESTATE SECURITIES INC.,

as Lender

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  I.

  	
  DEFINITIONS;
  PRINCIPLES OF CONSTRUCTION

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 1.1

  	
  Definitions

  	
  1

  
	
  Section 1.2

  	
  Principles
  of Construction

  	
  22

  
	
   

  	
   

  	
   

  
	
  II.

  	
  THE
  LOAN

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 2.1

  	
  The
  Loan

  	
  23

  
	
  2.1.1

  	
  Agreement
  to Lend and Borrow

  	
  23

  
	
  2.1.2

  	
  Single
  Disbursement to Borrower

  	
  23

  
	
  2.1.3

  	
  The
  Note

  	
  23

  
	
  2.1.4

  	
  Use
  of Proceeds

  	
  23

  
	
  Section 2.2

  	
  Interest
  Rate

  	
  23

  
	
  2.2.1

  	
  Applicable
  Interest Rate

  	
  23

  
	
  2.2.2

  	
  Interest
  Calculation

  	
  23

  
	
  2.2.3

  	
  Intentionally
  Omitted

  	
  23

  
	
  2.2.4

  	
  Usury
  Savings

  	
  24

  
	
  Section 2.3

  	
  Loan
  Payments

  	
  24

  
	
  2.3.1

  	
  Payment
  Before Maturity Date

  	
  24

  
	
  2.3.2

  	
  Payment
  on Maturity Date

  	
  24

  
	
  2.3.3

  	
  Interest
  Rate and Payment after Default

  	
  24

  
	
  2.3.4

  	
  Late
  Payment Charge

  	
  24

  
	
  2.3.5

  	
  Method
  and Place of Payment

  	
  25

  
	
  Section 2.4

  	
  Prepayments

  	
  25

  
	
  2.4.1

  	
  Voluntary
  Prepayments

  	
  25

  
	
  2.4.2

  	
  Mandatory
  Prepayments

  	
  29

  
	
  2.4.3

  	
  Prepayments
  After Default

  	
  29

  
	
  Section 2.5

  	
  Defeasance

  	
  30

  
	
  2.5.1

  	
  Total
  Defeasance

  	
  30

  
	
  2.5.2

  	
  Partial
  Defeasance

  	
  32

  
	
  2.5.3

  	
  Defeasance
  Collateral Account

  	
  35

  
	
  2.5.4

  	
  Successor
  Borrower

  	
  36

  
	
   

  	
   

  	
   

  
	
  III.

  	
  REPRESENTATIONS
  AND WARRANTIES

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 3.1

  	
  Borrower
  Representations

  	
  36

  
	
  3.1.1

  	
  Organization

  	
  36

  
	
  3.1.2

  	
  Proceedings

  	
  37

  
	
  3.1.3

  	
  No
  Conflicts

  	
  37

  
	
  3.1.4

  	
  Litigation

  	
  37

  
	
  3.1.5

  	
  Orders
  and Decrees

  	
  37

  
	
  3.1.6

  	
  Consents

  	
  37

  
	
  3.1.7

  	
  Title

  	
  37

  
	
  3.1.8

  	
  No
  Plan Assets

  	
  38

  
					

 

i

 

	
  3.1.9

  	
  Compliance

  	
  38

  
	
  3.1.10

  	
  Financial
  Information

  	
  38

  
	
  3.1.11

  	
  Condemnation

  	
  39

  
	
  3.1.12

  	
  Utilities
  and Public Access

  	
  39

  
	
  3.1.13

  	
  Separate
  Lots

  	
  39

  
	
  3.1.14

  	
  Assessments

  	
  39

  
	
  3.1.15

  	
  Enforceability

  	
  39

  
	
  3.1.16

  	
  Assignment
  of Leases

  	
  39

  
	
  3.1.17

  	
  Insurance

  	
  39

  
	
  3.1.18

  	
  Licenses

  	
  39

  
	
  3.1.19

  	
  Flood
  Zone

  	
  40

  
	
  3.1.20

  	
  Physical
  Condition

  	
  40

  
	
  3.1.21

  	
  Boundaries

  	
  40

  
	
  3.1.22

  	
  Leases

  	
  40

  
	
  3.1.23

  	
  Filing
  and Recording Taxes

  	
  41

  
	
  3.1.24

  	
  Single
  Purpose

  	
  41

  
	
  3.1.25

  	
  Tax
  Filings

  	
  46

  
	
  3.1.26

  	
  Solvency

  	
  46

  
	
  3.1.27

  	
  Federal
  Reserve Regulations

  	
  46

  
	
  3.1.28

  	
  Organizational
  Chart

  	
  47

  
	
  3.1.29

  	
  Bank
  Holding Company

  	
  47

  
	
  3.1.30

  	
  No
  Other Debt

  	
  47

  
	
  3.1.31

  	
  Investment
  Company Act

  	
  47

  
	
  3.1.32

  	
  Intentionally
  Omitted

  	
  47

  
	
  3.1.33

  	
  No
  Bankruptcy Filing

  	
  47

  
	
  3.1.34

  	
  Full
  and Accurate Disclosure

  	
  47

  
	
  3.1.35

  	
  Foreign
  Person

  	
  47

  
	
  3.1.36

  	
  Intentionally
  Omitted

  	
  47

  
	
  3.1.37

  	
  No
  Change in Facts or Circumstances; Disclosure

  	
  47

  
	
  3.1.38

  	
  Property
  Management

  	
  48

  
	
  3.1.39

  	
  Perfection
  of Accounts

  	
  48

  
	
  3.1.40

  	
  Agreements

  	
  48

  
	
  3.1.41

  	
  Intentionally
  Omitted

  	
  48

  
	
  3.1.42

  	
  SPE
  Separateness Covenants

  	
  48

  
	
  Section 3.2

  	
  Survival
  of Representations

  	
  48

  
	
   

  	
   

  	
   

  
	
  IV.

  	
  BORROWER
  COVENANTS

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 4.1

  	
  Borrower
  Affirmative Covenants

  	
  49

  
	
  4.1.1

  	
  Existence;
  Compliance with Legal Requirements

  	
  49

  
	
  4.1.2

  	
  Taxes
  and Other Charges

  	
  49

  
	
  4.1.3

  	
  Litigation

  	
  49

  
	
  4.1.4

  	
  Access
  to Property

  	
  50

  
	
  4.1.5

  	
  Further Assurances;
  Supplemental Mortgage Affidavits

  	
  50

  
	
  4.1.6

  	
  Financial Reporting

  	
  50

  
	
  4.1.7

  	
  Title to the
  Property

  	
  53

  
	
  4.1.8

  	
  Estoppel Statement

  	
  54

  
				

 

ii

 

	
  4.1.9

  	
  Leases

  	
  54

  
	
  4.1.10

  	
  Alterations

  	
  55

  
	
  4.1.11

  	
  Intentionally Omitted

  	
  57

  
	
  4.1.12

  	
  Material Agreements

  	
  57

  
	
  4.1.13

  	
  Performance by Borrower

  	
  57

  
	
  4.1.14

  	
  Costs of
  Enforcement/Remedying Defaults

  	
  57

  
	
  4.1.15

  	
  Business and
  Operations

  	
  57

  
	
  4.1.16

  	
  Intentionally Omitted

  	
  58

  
	
  4.1.17

  	
  Intentionally Omitted

  	
  58

  
	
  4.1.18

  	
  Cash
  Management Agency Agreement

  	
  58

  
	
  Section 4.2

  	
  Borrower
  Negative Covenants

  	
  58

  
	
  4.2.1

  	
  Due on Sale and
  Encumbrance; Transfers of Interests

  	
  58

  
	
  4.2.2

  	
  Liens

  	
  58

  
	
  4.2.3

  	
  Dissolution

  	
  58

  
	
  4.2.4

  	
  Change in Business

  	
  59

  
	
  4.2.5

  	
  Debt Cancellation

  	
  59

  
	
  4.2.6

  	
  Affiliate Transactions

  	
  59

  
	
  4.2.7

  	
  Zoning

  	
  59

  
	
  4.2.8

  	
  Assets

  	
  59

  
	
  4.2.9

  	
  No
  Joint Assessment

  	
  59

  
	
  4.2.10

  	
  Principal Place of
  Business

  	
  59

  
	
  4.2.11

  	
  ERISA

  	
  59

  
	
  4.2.12

  	
  Material Agreements

  	
  60

  
	
  4.2.13

  	
  Intentionally Omitted

  	
  60

  
	
  4.2.14

  	
  Intentionally Omitted

  	
  60

  
	
  4.2.15

  	
  Intentionally Omitted

  	
  60

  
	
  4.2.16

  	
  Cash Management
  Agency Agreement

  	
  60

  
	
   

  	
   

  	
   

  
	
  V.

  	
  INSURANCE, CASUALTY
  AND CONDEMNATION

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 5.1

  	
  Insurance

  	
  61

  
	
  5.1.1

  	
  Insurance Policies

  	
  61

  
	
  5.1.2

  	
  Insurance Company

  	
  64

  
	
  5.1.3

  	
  Current Insurance

  	
  65

  
	
  Section 5.2

  	
  Casualty
  and Condemnation

  	
  65

  
	
  5.2.1

  	
  Casualty

  	
  65

  
	
  5.2.2

  	
  Condemnation

  	
  66

  
	
  5.2.3

  	
  Casualty Proceeds

  	
  66

  
	
  Section 5.3

  	
  Delivery
  of Net Proceeds

  	
  67

  
	
  5.3.1

  	
  Minor
  Casualty or Condemnation

  	
  67

  
	
  5.3.2

  	
  Major
  Casualty or Condemnation

  	
  67

  
	
   

  	
   

  	
   

  
	
  VI.

  	
  RESERVE
  FUNDS

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 6.1

  	
  Required
  Repairs

  	
  70

  
	
  6.1.1

  	
  Required
  Repairs and Deposits of Required Repair Funds

  	
  70

  
	
  6.1.2

  	
  Release
  of Required Repair Funds

  	
  70

  
					

 

iii

 

	
  Section 6.2

  	
  Tax
  Funds

  	
  72

  
	
  6.2.1

  	
  Deposits
  of Tax Funds

  	
  72

  
	
  6.2.2

  	
  Release
  of Tax Funds

  	
  72

  
	
  Section 6.3

  	
  Insurance
  Funds

  	
  73

  
	
  6.3.1

  	
  Deposits
  of Insurance Funds

  	
  73

  
	
  6.3.2

  	
  Release
  of Insurance Funds

  	
  73

  
	
  Section 6.4

  	
  Capital
  Expenditure Funds

  	
  74

  
	
  6.4.1

  	
  Deposits
  of Capital Expenditure Funds

  	
  74

  
	
  6.4.2

  	
  Release
  of Capital Expenditure Funds

  	
  74

  
	
  Section 6.5

  	
  Borrower
  Cash Collateral Funds

  	
  76

  
	
  6.5.1

  	
  Deposits
  of Borrower Cash Collateral Funds

  	
  76

  
	
  6.5.2

  	
  Release
  of Borrower Cash Collateral Funds

  	
  76

  
	
  Section 6.6

  	
  Intentionally
  Omitted

  	
  76

  
	
  Section 6.7

  	
  Intentionally
  Omitted

  	
  76

  
	
  Section 6.8

  	
  Application
  of Reserve Funds

  	
  76

  
	
  Section 6.9

  	
  Security
  Interest in Reserve Funds

  	
  76

  
	
  6.9.1

  	
  Grant
  of Security Interest

  	
  76

  
	
  6.9.2

  	
  Income
  Taxes

  	
  76

  
	
  6.9.3

  	
  Prohibition
  Against Further Encumbrance

  	
  77

  
	
  Section 6.10

  	
  Intentionally
  Omitted

  	
  77

  
	
  Section 6.11

  	
  Provisions
  Regarding Letters of Credit

  	
  77

  
	
  6.11.1

  	
  Security
  for Debt

  	
  77

  
	
  6.11.2

  	
  Additional
  Rights of Lender

  	
  77

  
	
  Section 6.12

  	
  Guaranty
  or Letter of Credit in Lieu of Cash Deposit

  	
  77

  
	
   

  	
   

  	
   

  
	
  VII.

  	
  PROPERTY
  MANAGEMENT

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 7.1

  	
  The
  Management Agreement

  	
  78

  
	
  Section 7.2

  	
  Prohibition
  Against Termination or Modification

  	
  79

  
	
  Section 7.3

  	
  Replacement
  of Manager

  	
  79

  
	
  Section 7.4

  	
  The
  Cash Management Agency Agreement

  	
  79

  
	
   

  	
   

  	
   

  
	
  VIII.

  	
  PERMITTED
  TRANSFERS

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 8.1

  	
  Permitted
  Transfer of Property

  	
  80

  
	
  Section 8.2

  	
  Permitted
  Transfers of Interest in Borrower

  	
  82

  
	
   

  	
   

  	
   

  
	
  IX.

  	
  SALE
  AND SECURITIZATION OF MORTGAGE

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 9.1

  	
  Sale
  of Mortgage and Securitization; Loan Components; Mezzanine Loans

  	
  83

  
	
  Section 9.2

  	
  Securitization
  Indemnification

  	
  85

  
	
   

  	
   

  	
   

  
	
  X.

  	
  DEFAULTS

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 10.1

  	
  Event
  of Default

  	
  87

  
	
  Section 10.2

  	
  Remedies

  	
  90

  
	
  Section 10.3

  	
  Right
  to Cure Defaults

  	
  91

  
						

 

iv

 

	
  Section 10.4

  	
  Remedies
  Cumulative

  	
  92

  
	
   

  	
   

  	
   

  
	
  XI.

  	
  MISCELLANEOUS

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 11.1

  	
  Successors
  and Assigns

  	
  92

  
	
  Section 11.2

  	
  Lender’s
  Discretion

  	
  92

  
	
  Section 11.3

  	
  Governing
  Law

  	
  92

  
	
  Section 11.4

  	
  Modification,
  Waiver in Writing

  	
  94

  
	
  Section 11.5

  	
  Delay
  Not a Waiver

  	
  94

  
	
  Section 11.6

  	
  Notices

  	
  94

  
	
  Section 11.7

  	
  Trial
  by Jury

  	
  95

  
	
  Section 11.8

  	
  Headings

  	
  96

  
	
  Section 11.9

  	
  Severability

  	
  96

  
	
  Section 11.10

  	
  Preferences

  	
  96

  
	
  Section 11.11

  	
  Waiver
  of Notice

  	
  96

  
	
  Section 11.12

  	
  Remedies
  of Borrower

  	
  96

  
	
  Section 11.13

  	
  Expenses;
  Indemnity

  	
  97

  
	
  Section 11.14

  	
  Schedules
  Incorporated

  	
  98

  
	
  Section 11.15

  	
  Offsets,
  Counterclaims and Defenses

  	
  98

  
	
  Section 11.16

  	
  No
  Joint Venture or Partnership; No Third Party Beneficiaries

  	
  98

  
	
  Section 11.17

  	
  Publicity

  	
  98

  
	
  Section 11.18

  	
  Waiver
  of Marshalling of Assets

  	
  99

  
	
  Section 11.19

  	
  Waiver
  of Offsets/Defenses/Counterclaims

  	
  99

  
	
  Section 11.20

  	
  Conflict;
  Construction of Documents; Reliance

  	
  99

  
	
  Section 11.21

  	
  Brokers
  and Financial Advisors

  	
  99

  
	
  Section 11.22

  	
  Exculpation

  	
  99

  
	
  Section 11.23

  	
  Prior
  Agreements

  	
  101

  
	
  Section 11.24

  	
  Servicer

  	
  101

  
	
  Section 11.25

  	
  Joint
  and Several Liability

  	
  102

  
	
  Section 11.26

  	
  Creation
  of Security Interest

  	
  102

  
	
  Section 11.27

  	
  Assignments
  and Participations

  	
  103

  
	
  Section 11.28

  	
  Intentionally
  Omitted

  	
  104

  
	
  Section 11.29

  	
  Substitution

  	
  104

  
	
  Section 11.30

  	
  Partial
  Release – Expansion

  	
  110

  
				

 

v

 

SCHEDULES

 

	
  Schedule
  I -

  	
   

  	
  Major
  Customer List

  
	
  Schedule
  II -

  	
   

  	
  Required
  Repairs

  
	
  Schedule
  III -

  	
   

  	
  Organizational
  Chart

  
	
  Schedule
  IV -

  	
   

  	
  Form of
  Subordination, Non-Disturbance and Attornment Agreement

  
	
  Schedule
  V -

  	
   

  	
  Reserved

  
	
  Schedule
  VI -

  	
   

  	
  List
  of Properties, Allocated Loan Amounts, Allocated UCF Amounts, Allocated
  Capital Expenditure Amounts and Title

  
	
  Schedule
  VII -

  	
   

  	
  Proposed
  Annual Budget

  
	
  Schedule
  VIII -

  	
   

  	
  Leases
  with Major Tenants

  
	
  Schedule
  IX -

  	
   

  	
  List
  of Properties with no Certificate of Occupancy

  
	
  Schedule
  X -

  	
   

  	
  Reserved

  
	
  Schedule
  XI -

  	
   

  	
  Excluded
  Lender Transferees

  
	
  Schedule
  XII -

  	
   

  	
  Form of
  Alteration Guaranty

  
	
  Schedule
  3.1 -

  	
   

  	
  Disclosure
  Schedule

  

 

vi

 

LOAN
AGREEMENT

 

THIS LOAN
AGREEMENT, dated as of November 27, 2006 (as amended,
restated, replaced, supplemented or otherwise modified from time to time, this “Agreement”),
between UBS REAL ESTATE SECURITIES INC., a
Delaware corporation, having an address at 1285 Avenue of the Americas, New York, New York 10019 (“Lender”),
and ART MORTGAGE BORROWER PROPCO 2006-1A
L.P., a Delaware limited partnership (“Propco Borrower”), and
ART MORTGAGE BORROWER OPCO 2006-1A L.P., a
Delaware limited partnership (“Opco Borrower”, and together with Propco
Borrower, individually or collectively, as the context may require, “Borrower”),
each having an address at 10 Glenlake Parkway, Suite 800, Atlanta, Georgia
30328.

 

All capitalized terms used
herein shall have the respective meanings set forth in Article I hereof.

 

W I T N E S S E T H:

 

WHEREAS, Borrower
desires to obtain the Loan (as hereinafter defined) from Lender; and

 

WHEREAS, Lender is
willing to make the Loan to Borrower, subject to and in accordance with
the terms of this Agreement and the other Loan Documents (as hereinafter
defined).

 

NOW, THEREFORE, in
consideration of the covenants set forth in this Agreement, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto hereby agree, represent and warrant as follows:

 

I.                                         DEFINITIONS; PRINCIPLES OF
CONSTRUCTION

 

Section 1.1            Definitions.  For all purposes of this Agreement, except as
otherwise expressly provided:

 

“Accounts” shall have
the meaning set forth in the Cash Management Agreement.

 

“Affiliate” shall
mean, as to any Person, any other Person that, directly or indirectly, owns
forty percent (40%) or more of, is in control of, is controlled by or is under
common ownership or control with such Person or is a director, trustee or
officer of such Person or of an Affiliate of such Person.  As used in this definition, the term “control”
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management, policies or activities of a Person, whether
through ownership of voting securities, by contract or otherwise.

 

“Agent” shall mean
U.S. Bank National Association or any successor Eligible Institution thereto
acting as Agent under the Cash Management Agreement.

 

 

“Allocated Capital
Expenditure Amount” shall mean the portion of the Capital Expenditure
Maximum Amount allocated to each Individual Property, as set forth on Schedule
VI.

 

“Allocated Loan Amount”
shall mean the portion of the Loan allocated to each Individual Property, as
set forth on Schedule VI as the same may be reduced pursuant to Section 2.4.2.

 

“Allocated UCF Amount”
shall mean, with respect to any Individual Property, one hundred percent (100%)
of the portion of the Underwritable Cash Flow allocated to such Individual
Property as of the date hereof, as set forth on Schedule VI.

 

“Allocated UCF Cash Trap
Amount” shall mean, with respect to any Individual Property, eighty percent
(80.0%) of the Allocated UCF Amount for such Individual Property, as set forth
on Schedule VI.

 

“Allocated UCF Trigger
Amount” shall mean, with respect to any Individual Property, eighty-five
percent (85.0%) of the Allocated UCF Amount for such Individual Property, as
set forth on Schedule VI.

 

“ALTA” shall mean
American Land Title Association, or any successor thereto.

 

“Alteration” shall
mean any demolition, alteration, installation, improvement or decoration of or
to any Improvements at any Individual Property or any part thereof (it being
agreed that any expansion of the Improvements at any Individual Property shall
not be deemed to be an “Alteration” hereunder so long as such expansion is
undertaken and completed in accordance with Legal Requirements and this
definition shall specifically exclude Required Repairs).

 

“Alteration Collateral”
shall have the meaning set forth in Section 4.1.10(a).

 

“Alteration Guaranty”
shall have the meaning set forth in Section 4.1.10(a).

 

“Alteration Security”
shall have the meaning set forth in Section 4.1.10(a).

 

“Alteration Threshold”
shall mean the lesser of (i) five percent (5%)
of the aggregate outstanding principal amount of the Loan with respect
to all Alterations at any time to all of the Properties or, (ii) with
respect to any affected Individual Property, fifteen percent (15%) of the Allocated
Loan Amount for such Individual Property.

 

“Annual Budget” shall
mean the operating and capital budget for the Property setting forth Borrower’s
good faith estimate of Gross Revenue, Operating Expenses, and Capital
Expenditures for the applicable Fiscal Year.

 

“Applicable Interest Rate”
shall mean 5.5505% per annum.

 

“Appraisal” shall
mean an M.A.I. appraisal of the Property in its then “as is” condition,
prepared not more than ninety (90) days (or such longer period as shall be
acceptable

 

2

 

to
Lender) prior to the date delivered to Lender or Servicer in connection with
the relevant event or approval; which appraisal (i) shall meet the minimum
appraisal standards for national banks promulgated by the Comptroller of the
Currency pursuant to Title XI of the Financial Institutions Reform, Recovery,
and Enforcement Act of 1989, as amended (FIRREA), and (ii) otherwise shall
be in both form and substance (including with respect to methods, procedures
and scope of services) reasonably satisfactory to Lender.

 

“Approved Annual Budget”
shall have the meaning set forth in Section 4.1.6(e).

 

“Assignment of Leases”
shall mean, with respect to each Individual Property, that certain first
priority Assignment of Leases and Rents, dated as of the date hereof, from
Propco Borrower, as assignor, to Lender, as assignee, as the same may be
amended, restated, replaced, supplemented or otherwise modified from time to time.

 

“Assignment of Management
Agreement” shall mean that certain Assignment of Management Agreement and
Subordination of Management Fees, dated as of the date hereof, among Lender,
Propco Borrower and Manager, as the same may be amended, restated, replaced,
supplemented or otherwise modified from time to time.

 

“Award” shall mean
any compensation paid by any Governmental Authority in connection with a Condemnation in respect of all or any part of
any Individual Property.

 

“Bankruptcy Action”
shall have the meaning set forth in Section 3.1.24(y).

 

“Bankruptcy Code”
shall mean Title 11 of the United
States Code entitled “Bankruptcy,” as amended from time to time, and any
successor statute or statutes and all rules and regulations from time to
time promulgated thereunder, and any comparable foreign laws relating to
bankruptcy, insolvency or creditors’ rights.

 

“Basic Carrying Costs”
shall mean the sum of the following costs associated with the Property for the
relevant Fiscal Year or payment period: (i) Taxes and (ii) Insurance
Premiums.

 

“Borrower” shall
mean, individually or collectively as the context may require, Propco Borrower
and/or Opco Borrower.

 

“Borrower Cash Collateral
Funds” shall have the meaning set forth in Section 6.5.1.

 

“Borrower Excess Cash
Flow” shall have the meaning set forth in the Cash Management Agreement.

 

“Borrower GP” shall
have the meaning set forth in Section 3.1.24(z).

 

“Business Day” shall
mean any day other than a Saturday, a Sunday or a legal holiday on which
national banks are not open for general business in (i) the State of New York,
(ii) the state where the corporate trust office of the Trustee is located,
or (iii) the state where the servicing offices of the Servicer are
located.

 

3

 

“Capital Expenditure
Funds” shall have the meaning set forth in Section 6.4.1.

 

“Capital Expenditure
Maximum Amount” shall mean, as of any date, an amount equal to Two Million
Sixty-Nine Thousand Three Hundred Thirty-Three and No/100 Dollars
($2,069,333.00) less the Allocated Capital Expenditure Amount of each
Individual Property previously released from the lien of the Mortgage (or, in
lieu of such release, which Mortgage is assigned by Lender) pursuant to Section 2.4 or Section 2.5, and less the
Allocated Capital Expenditure Amount of a Substituted Property pursuant to Section 11.29,
but plus the Allocated Capital Expenditure Amount of a Substitute Property
pursuant to Section 11.29, subject in all cases to a maximum
aggregate of $2,069,333.00.

 

“Capital Expenditures”
for any period shall mean amounts expended for replacements and alterations to
the Property and required to be capitalized according to GAAP.

 

“Capital Expenditures
Work” shall mean any labor performed or materials installed in connection
with any Capital Expenditure.

 

“Carthage Property” shall
have the meaning set forth in the definition of “Expansion Parcel”.

 

“Cash Management Agency
Agreement” shall mean, collectively, (i) that certain Cash Management
Agency Agreement, dated as of the date hereof, between Propco Borrower and
Guarantor, (ii) that certain Cash Management Sub-Agency Agreement dated as
of the date hereof between Guarantor and Logistics and (iii) that certain
Administrative Services and Cost Allocation Agreement dated as of the date
hereof between Opco Borrower and Logistics, in each case as the same may be
amended, restated, replaced, supplemented or otherwise modified from time to
time in accordance with the terms of this Agreement.

 

“Cash Management
Agreement” shall mean that certain Cash Management Agreement, dated as of
the date hereof, among Lender, Borrower, Manager and Agent.

 

“Cash Trap Event”
shall mean, on the relevant date, the fact that the annual Underwritable Cash
Flow for the Property determined by Lender as of the end of each fiscal quarter
(based on Borrower’s Fiscal Year) on a trailing four (4) quarter basis is
less than the Cash Trap UCF Amount.

 

“Cash Trap Period”
shall mean a period commencing on the first (1st) Business Day after a Cash
Trap Event has occurred to the first (1st) Business Day after the related Cash
Trap Event has not existed for a period of two (2) consecutive fiscal
quarters.

 

“Cash Trap UCF Amount”
shall mean, as of any date, an amount equal to the aggregate of the Allocated
UCF Cash Trap Amounts of all Individual Properties less the Allocated UCF Cash
Trap Amount of each Individual Property previously released from the lien of
the Mortgage (or, in lieu of such release, which Mortgage was assigned by
Lender) pursuant to Section 2.4 or Section 2.5.

 

“Casualty” shall mean
the occurrence of any casualty, damage or injury, by fire or otherwise, to any
Individual Property or any part thereof.

 

4

 

“Casualty Consultant”
shall mean an independent architect selected
by Lender.

 

“Casualty Retainage”
shall have the meaning set forth in Section 5.3.2(d).

 

“CEI” shall mean
Crescent Real Estate Equities Company, a Texas real estate investment trust,
and its permitted successors by merger, consolidation or transfer of all or
substantially all of the assets of CEI, subject to any terms, covenants and/or
conditions of this Agreement.

 

“Closing Date” shall
mean the date hereof.

 

“Code” shall mean the
Internal Revenue Code of 1986, as amended, and as it may be further amended
from time to time, any successor statutes thereto, and applicable U.S.
Department of Treasury regulations issued pursuant thereto in temporary or
final form.

 

“Condemnation” shall
mean a temporary or permanent taking by any Governmental Authority as the
result or in lieu or in anticipation of the exercise of the right of
condemnation or eminent domain, of all or any part of any Individual Property,
or any interest therein or right accruing thereto, including any right of
access thereto or any change of grade affecting any Individual Property or any
part thereof.

 

“Confidential” shall
mean that, prior to the occurrence of an Event of Default or special servicing
of the Loan for any reason whatsoever, such information shall not be
disseminated by Lender to the general public unless such information is already
in the public domain or unless Lender is otherwise required by law, legal
requirement or order, writ, subpoena or other directive of any Governmental
Authority.  Notwithstanding the
foregoing, Lender shall not be restricted or prohibited in any manner
whatsoever from providing such information to its consultants, attorneys or
accountants, the Servicer, any Rating Agencies or any potential participants or
assignees (other than any Excluded Lender Transferee) of all or any portion of
the Loan or in connection with a Securitization of all or any portion of the Loan.

 

“CRE” shall mean
Crescent Real Estate Equities Limited Partnership, a Delaware limited
partnership, and its permitted successors by merger, consolidation or transfer
of all or substantially all of the assets of CRE, subject to any terms,
covenants and/or conditions of this Agreement.

 

“Debt” shall mean the
outstanding principal amount of the Loan together with all interest accrued and
unpaid thereon and all other sums (including, without limitation, any Yield
Maintenance Premium) due to Lender in respect
of the Loan under the Note, this Agreement, the Mortgage, the Environmental
Indemnity or any other Loan Document.

 

“Debt Service” shall
mean, with respect to any particular period of time, scheduled principal and
interest payments under the Note.

 

“Debt Service Coverage
Ratio” shall mean, as of any date of calculation, the ratio of (i) Underwritable
Cash Flow for the twelve (12) calendar month period immediately preceding such
date to (ii) the projected Debt Service
that would be due for the twelve (12)

 

5

 

calendar
month period immediately following such date based upon an assumed loan
constant for such period equal to the Applicable Interest Rate.

 

“Default” shall mean
the occurrence of any event hereunder or under any other Loan Document which,
but for the giving of notice or passage of time, or both, would be an Event of
Default.

 

“Default Rate” shall
mean, with respect to the Loan, a rate per annum equal to the lesser of (i) the maximum rate permitted by applicable
law, or (ii) three percent (3%) above the Applicable Interest Rate.

 

“Defeasance Collateral”
shall mean the Total Defeasance Collateral or the Partial Defeasance Collateral as the context may require.

 

“Defeasance Collateral
Account” shall have the meaning set forth in Section 2.5.3.

 

“Defeasance Date”
shall mean the Total Defeasance Date or the Partial Defeasance Date as the
context may require.

 

“Defeasance Event”
shall the Total Defeasance Event or the Partial Defeasance Event as the context
may require.

 

“Defeasance Security
Agreement” shall mean a security agreement in form and substance that would
be reasonably satisfactory to a reasonably prudent lender originating
commercial loans for securitization similar to the Loan pursuant to which
Borrower grants Lender a perfected, first priority security interest in the Defeasance Collateral Account
and the Defeasance Collateral.

 

“Defeased Note” shall
have the meaning set forth in Section 2.5.2(a)(iv).

 

“Disclosure Document”
shall have the meaning set forth in Section 9.2(a).

 

“Disqualified Transferee”
shall mean any Person that (i) has (within the past seven (7) years)
defaulted, or is now in default, beyond any applicable cure period, of its
material obligations, under any written agreement with Lender, any affiliate of
Lender, any financial institution or other Person providing or arranging
financing; (ii) has been convicted in a criminal proceeding for a felony
or a crime involving moral turpitude or that is an organized crime figure or is
reputed (as determined by Lender in its sole discretion) to have substantial
business or other affiliations with an organized crime figure; (iii) has
at any time filed a voluntary petition under the Bankruptcy Code or any other
federal or state bankruptcy or insolvency law; (iv) as to which an
involuntary petition has at any time been filed under the Bankruptcy Code or
any other federal or state bankruptcy or insolvency law; (v) has at any
time filed an answer consenting to or acquiescing in any involuntary petition
filed against it by any other person under the Bankruptcy Code or any other
federal or state bankruptcy or insolvency law; (vi) has at any time
consented to or acquiesced in or joined in an application for the appointment
of a custodian, receiver, trustee or examiner for itself or any of its
property; (vii) has at any time made a general assignment for the benefit
of creditors, or has at any time admitted its insolvency or inability to

 

6

 

pay
its debts as they become due; or (viii) has been found by a court of
competent jurisdiction or other governmental authority in a comparable
proceeding to have violated any federal or state securities laws or regulations
promulgated thereunder.

 

“Downgrade Event”
shall have the meaning set forth in Section 10.1(a)(xvi).

 

“Eligible Account”
shall mean an identifiable account which is separate from all other funds held
by the holding institution that is either (a) an account or accounts
maintained with the corporate trust department of a federal or state-chartered
depository institution or trust company which complies with the definition of
Eligible Institution or (b) a segregated trust account or accounts maintained
with the corporate trust department of a federal or state chartered depository
institution or trust company acting in its fiduciary capacity which, in the
case of a state chartered depository institution or trust company is subject to
regulations substantially similar to 12 C.F.R. § 9.10(b), having in either case
a combined capital and surplus of at least $50,000,000 and subject to
supervision or examination by federal and state authority. An Eligible Account
will not be evidenced by a certificate of deposit, passbook or other
instrument.

 

“Eligible Institution”
shall mean a federal or state chartered depository institution or trust company
insured by the Federal Deposit Insurance Corporation the short-term unsecured
debt obligations or commercial paper of which are rated at least “A-1” (or the
equivalent) by S&P, Moody’s and Fitch in the case of accounts in which
funds are held for thirty (30) days or less or, in the case of accounts in
which funds are held for more than thirty (30) days, the long-term unsecured
debt obligations of which are rated at least “AA-” (or the equivalent) by
S&P, Fitch and Moody’s.

 

“Environmental Indemnity”
shall mean that certain Environmental Indemnity Agreement dated as of the date
hereof executed by Borrower and Guarantor in connection with the Loan for the
benefit of Lender.

 

“Equipment” shall
have the meaning set forth in the granting clause of the Mortgage.

 

“ERISA” shall have
the meaning set forth in Section 3.1.8.

 

“Event of Default”
shall have the meaning set forth in Section 10.1.

 

“Exchange Act” shall
have the meaning set forth in Section 9.2(a).

 

“Excess Alteration Amount”
shall have the meaning set forth in Section 4.1.10(a).

 

“Excluded Lender
Transferee” shall mean any Person listed on Schedule XI and its Affiliates.

 

“Excusable Delay”
shall mean a delay due to acts of God, governmental restrictions, stays,
judgments, orders, decrees, enemy actions, civil commotion, fire, casualty,
strikes, work stoppages, shortages of labor or materials or other causes beyond
the reasonable control of Borrower, but lack of funds in and of itself shall
not be deemed a cause beyond the control of Borrower.

 

7

 

“Expansion Date”
shall have the meaning set forth in Section 11.30(a)(i).

 

“Expansion Parcel”
shall mean an unimproved area or areas of any Individual Property on which
Rents are not payable and Improvements (other than utilities and the like that
are permitted pursuant to a recorded agreement) are not situated, which area or
areas are not necessary for the use and operation of the remainder of such
Individual Property (except to the extent such use or operation is permitted
pursuant to a separate agreement), are designated by Borrower for expansion or
any other reasonable business purpose in order to service any customer or
prospective customer of Borrower or any Affiliate of Borrower, the transfer and
separate development of which would not, in Borrower’s judgment (provided
Borrower has certified  the same)
materially adversely affect the value of the remaining portion of such
Individual Property or the Underwritable Cash Flow from the remaining portion
of such Individual Property (taking into account, to the extent applicable, any
potential loss of revenue resulting if the transfer and development of the
Expansion Parcel were not to occur), and, with respect to the Individual
Property located in Carthage, Missouri (the “Carthage Property”) only,
will not be used as a dry and/or cold storage warehousing facility or
distribution center.

 

“Fiscal Year” shall
mean each twelve month period commencing on January 1 and ending on December 31
during each year of the term of the Loan.

 

“Fitch” shall mean
Fitch, Inc.

 

“GAAP” shall mean
generally accepted accounting principles in the United States of America set
forth in the opinions and pronouncements of the Accounting Principles Board and
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board (or agencies with similar
functions of comparable stature and authority within the accounting
profession), or in such other statements by such entity as may be in general
use by significant segments of the U.S. accounting profession.

 

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

 

“Gross Revenue” shall
mean all revenue, derived from the ownership and operation of the Property from
whatever source, including, but not limited to, Rents, but excluding receipts,
revenues and other income generated from transportation operations conducted or
performed by Borrower or any of its Affiliates from or with respect to any one
or more individual Properties, sales, use and occupancy or other taxes on
receipts required to be accounted
for by the owner or operator of the Property to any Governmental Authority,
non-recurring revenues as reasonably determined by Lender, proceeds from the
sale or refinancing of any Individual Property, security deposits (except to
the extent determined by Lender to be properly utilized to offset a loss of
Rent), refunds and uncollectible accounts, proceeds of casualty insurance and
Awards (other than business interruption or other loss of income insurance
related to business interruption or loss of income for the period in question),
and any disbursements to Borrower or any operator of the Property from the Reserve
Funds or any other fund established by the Loan Documents.

 

8

 

“Guarantor” shall
mean Americold Realty Trust, a Maryland real estate investment trust, and its
permitted successors by merger, consolidation or transfer of all or
substantially all of the assets of Americold Realty Trust, subject to any
terms, covenants and/or conditions of this Agreement.

 

“Guaranty” shall mean
that certain Recourse Guaranty dated as of the date hereof executed by the
Guarantor in connection with the Loan for the benefit of Lender.

 

“Improvements” with
respect to each Individual Property, shall have the meaning set forth in the
granting clause of the applicable Mortgage.

 

“Indebtedness” shall
mean, for any Person, without duplication: (i) all indebtedness of such
Person for borrowed money, for amounts drawn under a letter of credit, or for
the deferred purchase price of property for which such Person or its assets is
liable, (ii) all unfunded amounts under a loan agreement, letter of
credit, or other credit facility for which such Person would be liable if such
amounts were advanced thereunder, (iii) all amounts required to be paid by
such Person as a guaranteed payment to partners or a preferred or special
dividend, including any mandatory redemption of shares or interests, (iv) all
indebtedness guaranteed by such Person, directly or indirectly, (v) all
obligations under leases that constitute capital leases for which such Person
is liable, and (vi) all obligations of such Person under interest rate
swaps, caps, floors, collars and other interest hedge agreements, in each case
whether such Person is liable contingently or otherwise, as obligor, guarantor
or otherwise, or in respect of which obligations such Person otherwise assures
a creditor against loss.

 

“Indemnified Liabilities”
shall have the meaning set forth in Section 11.13(b).

 

“Independent Director”
shall have the meaning set forth in Section 3.1.24(p).

 

“Individual Loan-to-Value
Ratio” shall mean, with respect to an Individual Property, as of any date
of determination, a ratio (as reasonably determined by Lender), (x) the
numerator of which is equal to the Allocated Loan Amount for such Individual
Property, and (y) the denominator of which is equal to the “as-is” fair market
value of such Individual Property, determined with respect to the Closing Date
by the Appraisals delivered to Lender on or prior to the date hereof, and with
respect to future dates, on the basis of Lender’s reasonable determination of
the fair market value of such Individual Property, or, if Borrower disputes
Lender’s valuation or otherwise elects to deliver an Appraisal, on the basis of
an Appraisal commissioned by the Lender and at Borrower’s expense.

 

“Individual Property”
shall mean the parcel of real property located at each address listed on Schedule
VI other than any Release Property or Expansion Parcel released pursuant to
Section 2.4, 2.5  or 11.30, the Improvements thereon and all personal property
owned by Borrower and encumbered by a Mortgage, together with all of Borrower’s
rights pertaining to such property and Improvements, all as more particularly
described in the Granting Clauses of the applicable Mortgage.

 

“Insolvency Opinion”
shall mean that certain bankruptcy nonconsolidation opinion letter dated the
date hereof delivered by Arnall Golden Gregory LLP in connection with the Loan.

 

9

 

“Insurance Funds”
shall have the meaning set forth in Section 6.3.1.

 

“Insurance Premiums”
shall have the meaning set forth in Section 5.1.1(b).

 

“Interest Period”
shall mean, with respect to any Monthly Payment Date, the period commencing on
the eleventh (11th) day of the preceding calendar month and terminating on the
tenth (10th) day of the calendar month in which such Monthly Payment Date
occurs; provided that the initial Interest Period shall begin on the
Closing Date and shall end on the immediately following tenth (10th) day of a
calendar month.

 

“Investment Grade Rating”
shall mean a long-term unsecured debt rating of at least “BBB-” (or the
equivalent) by S&P, Fitch and Moody’s.

 

“Lease” shall mean
any lease, sublease or subsublease, letting, license, concession or other
agreement (whether written or oral and whether now or hereafter in effect)
pursuant to which any Person is granted a possessory interest in, or right to
use or occupy all or any portion of any space in any Individual Property, and every
modification, amendment or other agreement relating to such lease, sublease,
subsublease, or other agreement entered into in connection with such lease,
sublease, subsublease, or other agreement and every guarantee of the
performance and observance of the covenants, conditions and agreements to be
performed and observed by the other party thereto.  As used herein and in the other Loan
Documents, the term “Lease” shall be deemed to include any Warehouse
Agreements.

 

“Legal Requirements”
shall mean all federal, state, county, municipal and other governmental
statutes, laws, rules, orders, regulations, ordinances, judgments, decrees and
injunctions of Governmental Authorities affecting Borrower, Manager or any
Individual Property or any part thereof or the construction, use, alteration or
operation thereof, or any part thereof, whether now or hereafter enacted and in
force, including, without limitation, the Americans with Disabilities Act of
1990, and all permits, licenses and authorizations and regulations relating
thereto, and all covenants, agreements, restrictions and encumbrances contained
in any instruments, either of record or known to Borrower, at any time in force
affecting the Borrower or any Individual Property or any part thereof,
including, without limitation, any which may (i) require repairs,
modifications or alterations in or to any Individual Property or any part
thereof, or (ii) in any way limit the use and enjoyment thereof.

 

“Lender” shall mean
UBS Real Estate Securities Inc., a Delaware corporation, together with its
successors, assigns, and, subject to and for the purposes set forth in Section 11.27,
Participants.

 

“Lender Group” shall
have the meaning set forth in Section 9.2(b).

 

“Lender Indemnitees”
shall have the meaning set forth in Section 11.13(b).

 

“Letter of Credit”
shall mean an irrevocable, unconditional, transferable,. clean sight draft
letter of credit acceptable to Lender and the Rating Agencies in favor of
Lender and entitling Lender to draw thereon in New York, New York, issued by a
domestic Eligible Institution or the U.S. agency or branch of a foreign
Eligible Institution.  The Letter of
Credit shall have a term of at least one (1) year (or such shorter period
of time necessary for such Letter 

 

10

 

of
Credit to have a term which does not expire until at least thirty (30) days
after the Maturity Date); provided, however, that any such Letter
of Credit which is in effect upon the Maturity Date shall not expire until at
least thirty (30) days after the Maturity Date. 
If Borrower has not provided Lender with a new Letter of Credit at least
ten (10) Business Days prior to the expiration of any Letter of Credit,
then Lender shall have the not to immediately draw down the same in full and
hold the proceeds of such draw as cash security in accordance with the
applicable provisions hereof.  If at any
time the bank issuing any such Letter of Credit shall cease to be an Eligible
Institution and Borrower does not replace such Letter of Credit with a Letter
of Credit issued by an institution that is an Eligible Institution prior to the
earlier to occur of (i) five (5) days
after Borrower has knowledge of such event or (ii) five (5) days after Lender has provided Borrower with notice
thereof, then Lender shall have the right immediately to draw down the same in
full and hold the proceeds of such draw
in accordance with the applicable provisions hereof.

 

“Liabilities” shall
have the meaning set forth in Section 9.2(b).

 

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

 

“Loan” shall mean the
loan in the original principal amount of One Hundred Ninety-Four Million and
No/100 Dollars ($194,000,000.00) made by Lender to Borrower pursuant to this
Agreement.

 

“Loan Documents”
shall mean, collectively, this Agreement, the Note, the Mortgage, the
Assignment of Leases, the Cash Management Agreement, the Environmental
Indemnity, the Guaranty, the Assignment of Management Agreement, the Security
Agreement and any other document pertaining to the Property as well as all other
documents now or hereafter executed and/or delivered in connection with the
Loan, as the same may be amended, restated, replaced, supplemented or otherwise
modified from time to time.

 

“Loan-to-Value Ratio”
shall mean, as of any date of determination, a ratio (as reasonably determined
by Lender), (x) the numerator of which is equal to (i) the
outstanding principal balance of the Loan, and (y) the denominator of
which is equal to the “as-is” fair market value of the Property, determined on
the basis of Lender’s reasonable determination of the fair market value of the
Property, or, if Borrower disputes Lender’s valuation, on the basis of an
Appraisal commissioned by the Lender and at Borrower’s expense.

 

“Logistics” shall
mean AmeriCold Logistics LLC, a Delaware limited liability company, and its
permitted successors by merger, consolidation or transfer of all or
substantially all of the assets of AmeriCold Logistics LLC, subject to any
terms, covenants and/or conditions of this Agreement.

 

11

 

“Major Customer List”
shall mean a list of those customers each of which, pursuant to one or more
Leases or Service Contracts for space at one or more of the Individual
Properties, is required to make aggregate annual payments to the Borrowers of
not less than $4,000,000.  The Major
Customer List as of the date hereof is attached hereto as Schedule I.

 

“Major Lease” shall
mean any Lease covering all or substantially all of an Individual Property.

 

“Major Tenant” shall
mean (i) any Tenant occupying all or substantially all of any Individual
Property pursuant to a Lease (other than any month-to-month Lease) and (ii) any
Tenant under any Lease listed on Schedule VIII.

 

“Management Agreement”
shall mean (a) that certain Management Agreement, dated as of the date
hereof, between Propco Borrower and Manager, as the same may be amended or
otherwise modified from time to time in accordance with the terms of this
Agreement, or (b) if the context requires, a replacement management agreement
entered into by and between Borrower and a Qualified Manager in accordance with
the terms of this Agreement.

 

“Manager” shall mean (a) ART
Manager L.L.C. or (b) if the
context requires, any other Qualified Manager which becomes manager of the
Property in accordance with the terms of
this Agreement.

 

“Material Adverse Effect”
shall mean any event or condition that has a material and adverse effect, in
each case, taken as a whole on (a) the business operations, economic
performance, assets, financial condition, equity, contingent liabilities,
prospects, material agreements or results of operations of Borrower, Guarantor
or the Property, (b) the ability of Borrower or Guarantor to perform, in
all material respects, its respective obligations under the Loan Documents, (c) the
enforceability or validity of any Loan Document, the perfection or priority of
any Lien created under any Loan Document or the remedies of Lender under any
Loan Document, (d) the value of, or cash flow (other than cash flow from
transportation operations conducted or performed by Borrower or any of its
Affiliates from or with respect to any one or more Individual Properties) from,
the Property or the operations thereof or (e) the value of the Loan.

 

“Material Agreements”
means each contract and agreement relating to the ownership, management,
development, use, operation, leasing, maintenance, repair or improvement of any
one (1) or more Individual Properties, other than the Management Agreement
and the Leases, under which there is an obligation of Borrower to pay more than
One Million and No/100 Dollars ($1,000,000.00) per annum.

 

“Maturity Date” shall
mean December 11, 2016 or such other date on which the final payment of
principal of the Note becomes due and payable as therein or herein provided,
whether at such stated maturity date, by declaration of acceleration, or
otherwise.

 

“Maximum Legal Rate”
shall mean the maximum nonusurious interest rate, if any, that at any time or from time to time may be contracted for, taken, reserved,
charged or received on the indebtedness evidenced by the Note and as provided
for herein or the other Loan 

 

12

 

Documents,
under the laws of such state or states whose laws are held by any court of
competent jurisdiction to govern the interest rate provisions of the Loan.

 

“Minimum Disbursement
Amount” shall mean Twenty-Five Thousand and No/100 Dollars ($25,000).

 

“Monthly Debt Service
Payment Amount” shall mean, with respect to any Monthly Payment Date, the
interest amount determined in accordance with Section 2.2.2 of this
Agreement.

 

“Monthly Payment Date”
shall mean the eleventh (11th) calendar day of each calendar month during the
term of the Loan, and if such day is not a Business Day, then the Business Day
immediately preceding Business Day, commencing on January 11, 2007, and
continuing to and including the Maturity Date.

 

“Moody’s” shall mean
Moody’s Investors Service, Inc.

 

“Mortgage” shall
mean, with respect to each Individual Property, that certain first priority
Mortgage, Deed of Trust or Deed to Secure Debt, dated as of the date hereof,
executed and delivered by Propco Borrower and encumbering the applicable
Individual Property, as the same may be amended, restated, replaced,
supplemented or otherwise modified from time to time.

 

“Net Proceeds” shall
mean: (i) the net amount of all insurance proceeds payable as a result of
a Casualty to any Individual Property, after deduction of reasonable costs and
expenses (including, but not limited to, reasonable attorneys’ fees), if any,
in collecting such insurance proceeds, or (ii) the net amount of the
Award, after deduction of reasonable costs and expenses (including, but not
limited to, reasonable attorneys’ fees), if any, in collecting such Award.

 

“Net Proceeds Deficiency”
shall have the meaning set forth in Section 5.3.2(f).

 

“Note” shall mean
that certain Promissory Note dated as of the date hereof made by Borrower in
the original principal amount of One Hundred Ninety-Four Million and No/100
Dollars ($194,000,000.00), and, if applicable, the Defeased Note and the
Undefeased Note, in each case as the same may be amended, restated, replaced,
supplemented, increased, extended, consolidated or otherwise modified from time
to time.

 

“Notice” shall have
the meaning set forth in Section 11.6.

 

“Officer’s Certificate”
shall mean a certificate delivered to Lender by Borrower which is signed by an
authorized senior officer of Borrower.

 

“Opco Borrower” shall
mean ART Mortgage Borrower Opco 2006-1A L.P., a Delaware limited partnership,
and its successors by merger, consolidation or transfer of all or substantially
all of the assets of such Person (except to the extent that any such merger,
consolidation or transfer may be prohibited hereunder).

 

13

 

“Opco Borrower GP”
shall have the meaning set forth in Section 3.1.24(z).

 

“Operating Agreements”
shall mean any covenants, restrictions or agreements of record relating to the
construction, operation or use of the Property.

 

“Operating Expenses”
shall mean all costs and expenses incurred by or on behalf of Borrower relating
to the operation, maintenance and management of the Property, including,
without limitation, utilities, repairs and maintenance, insurance, property
taxes and assessments, advertising expenses, payroll and related taxes,
equipment lease payments, a management fee equal to the greater of 2% of annual
Rents (less management salaries and related taxes) or the actual management fee
and $0.03 per gross cubic foot of the Improvements per annum with respect to
capital costs, but excluding actual Capital Expenditures, depreciation,
amortization, obligations to post security to secure workers’ compensation
obligations, deposits required to be
made to the Reserve Funds and sales, use and occupancy or other taxes on
receipts required to be accounted for by the owner or operator of the Property
to any Governmental Authority; provided, however such costs and
expenses shall be subject to adjustment by Lender in its reasonable discretion to normalize such costs and
expenses.  Notwithstanding the foregoing,
“Operating Expenses” shall exclude all costs and expenses incurred in
connection with transportation operations conducted or performed by Borrower or
any of its Affiliates from or with respect to any one or more Individual
Properties.

 

“Other Charges” shall
mean all ground rents, maintenance charges, impositions other than Taxes, and
any other charges, including, without limitation, vault charges and license
fees for the use of vaults, chutes and similar areas adjoining any Individual
Property, now or hereafter levied or assessed or imposed against any Individual
Property or any part thereof.

 

“Otherwise Rated Insurer”
shall have the meaning set forth in Section 5.1.2.

 

“Partial Defeasance
Collateral” shall mean U.S. Obligations which provide payments (i) on
or prior to, but as close as possible to, the Business Day immediately
preceding all Monthly Payment Dates, under the Defeased Note after the
Defeasance Date and up to and including the Monthly Payment Date which Borrower
shall specify occurring concurrently with or after the Permitted Prepayment
Date, and (ii) in amounts equal to or greater than the Scheduled
Defeasance Payments relating to such Monthly Payment Dates.

 

“Partial Defeasance Date”
shall have the meaning set forth in Section 2.5.2(a)(i).

 

“Partial Defeasance Event”
shall have the meaning set forth in Section 2.5.2(a).

 

“Participant” shall
mean any Person that has purchased a participation in this Loan Agreement pursuant
to Section 11.27.

 

“Permitted Encumbrances”
shall mean, collectively, (i) the Liens and security interests created by
the Loan Documents, (ii) all Liens, encumbrances and other matters
disclosed in the Title Insurance Policy, (iii) Liens, if any, for Taxes
imposed by any Governmental Authority not yet due or delinquent, (iv) mechanics’,
materialmen’s or other similar Liens for delinquent Taxes being contested in
good faith if permitted by and in 

 

14

 

accordance
with the terms and provisions of the Loan Documents and (v) such other
title and survey exceptions as Lender has approved or may approve in writing in
Lender’s sole discretion.

 

“Permitted Investments”
shall have the meaning set forth in the Cash Management Agreement.

 

“Permitted Prepayment
Date” shall mean the Monthly Payment Date occurring in August 2016.

 

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

 

“Physical Conditions
Report” shall mean, with respect to each Individual Property, a report
prepared by a company satisfactory to Lender regarding the physical condition
of such Individual Property, satisfactory in form and substance to Lender in
its sole discretion, which report shall, among other things, (i) confirm
that the applicable Individual Property and its use comply, in all material
respects, with all applicable Legal Requirements (including, without
limitation, zoning, subdivision and building laws) and (ii) include a copy
of a final certificate of occupancy with respect to all Improvements.

 

“Plan Assets Regulation”
shall have the meaning specified in Section 3.1.8.

 

“Policies” shall have
the meaning specified in Section 5.1.1(b).

 

“Prepayment Date”
shall mean the date on which the Loan is prepaid in whole or in part in
accordance with the terms hereof.

 

“Prescribed Laws”
shall mean, collectively, (a) the Uniting and Strengthening America by
Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of
2001 (Public Law 107-56) (The U.S.A. PATRIOT Act), (b) Executive Order No. 13224
on Terrorist Financing, effective September 24, 2001, and relating to
Blocking Property and Prohibiting Transactions With Persons Who Commit,
Threaten to Commit, or Support Terrorism, (c) the International Emergency
Economic Power Act, 50 U.S.C. § 1701 et  seq. and (d) all
other Legal Requirements relating to money laundering or terrorism.

 

“primary Servicer”
shall have the meaning set forth in Section 11.24(d).

 

“Propco Borrower”
shall mean ART Mortgage Borrower Propco 2006-1A L.P., a Delaware limited
partnership, and its successors by merger, consolidation or transfer of all or
substantially all of the assets of such Person (except to the extent that any
such merger, consolidation or transfer may be prohibited hereunder).

 

“Propco Borrower GP”
shall have the meaning set forth in Section 3.1.24(z).

 

“Property” shall
mean, collectively, the individual Properties.

 

15

 

“Public Company”
shall mean a Person whose stock or ownership interests are publicly traded on
the New York Stock Exchange or other nationally recognized stock exchange.

 

“Qualified Appraiser”
means any member of the American Institute of Real Estate Appraisers selected
by Borrower and reasonably acceptable to the Lender.

 

“Qualified Transferee”
shall mean any one of the following Persons:

 

(i)            a corporation, partnership or limited liability company
acceptable to Lender in its sole discretion;

 

(ii)           a pension fund, pension trust or pension account that immediately
prior to such transfer owns, directly or indirectly, total real estate assets
of at least $1,000,000,000;

 

(iii)          a pension fund advisor who (a) immediately prior to
such transfer, controls, directly or indirectly, at least $1,000,000,000 of
real estate assets and (b) is acting on behalf of one or more pension
funds that, in the aggregate, satisfy the requirements of clause (ii) of
this definition;

 

(iv)          an insurance company which is subject to supervision by the
insurance commissioner, or a similar official or agency, of a state or
territory of the United States (including the District of Columbia) (a) with
a net worth, determined under GAAP as of a date no more than six (6) months
prior to the date of the transfer of at least $500,000,000 and (b) who,
immediately prior to such transfer, controls, directly or indirectly, real
estate assets of at least $1,000,000,000;

 

(v)           a corporation organized under the banking laws of the
United States or any state or territory of the United States (including the District
of Columbia) (a) with a combined capital and surplus of at least
$500,000,000 and (b) who, immediately prior to such transfer, controls,
directly or indirectly, real estate assets of at least $1,000,000,000; or

 

(vi)          any Person in which
fifty-one percent (51%) of the ownership interests are owned directly or
indirectly by any of the entities listed in subsections (i) through (v) of
this definition of “Qualified Transferee”, or any combination of more than one
such entity, and which is controlled directly or indirectly by such entity or entities;

 

provided, in each case,
that such Person (a) qualifies as a bankruptcy remote entity under
criteria established by the Rating Agencies and (b) has delivered to
Lender a non-consolidation opinion reasonably acceptable to Lender and
acceptable the Rating Agencies in their sole discretion.

 

“Qualified Manager”
shall mean (a) ART Manager L.L.C., (b) any other Affiliate of
Borrower, (c) any other Person as to which Borrower shall have obtained a
Rating Agency Confirmation or (d) any Person designated by Lender, provided
that in the case of (a), (b) and (c) Lender has not required Borrower
to replace such Person (or any Affiliate
of such Person) as Manager pursuant to Section 7.3.

 

“Rating Agencies”
shall mean, prior to the final Securitization of the Loan, each of S&P,
Moody’s and Fitch, or any other nationally recognized statistical rating agency
which 

 

16

 

has
been designated by Lender and, after the final Securitization of the Loan,
shall mean any of the foregoing that have rated any of the Securities.

 

“Rating Agency
Confirmation” shall mean a written affirmation from each of the Rating
Agencies that the credit rating of the Securities by such Rating Agency immediately
prior to the occurrence of the event with respect to which such Rating Agency
Confirmation is sought will not be qualified, downgraded or withdrawn as a
result of the occurrence of such event, which affirmation may be granted or
withheld in such Rating Agency’s sole and absolute discretion.

 

“Register” shall have
the meaning set forth in Section 11.27(e).

 

“Registration Statement”
shall have the meaning set forth in Section 9.2(b).

 

“Regulation AB” shall
mean Regulation AB under the Securities Act and the Exchange Act, as such
Regulation may be amended from time to time.

 

“Regulation D” shall
mean Regulation D of the Board
of Governors of the Federal Reserve System from time to time in effect,
including any successor or other Regulation or official interpretation of said
Board of Governors relating to reserve requirements applicable to member banks
of the Federal Reserve System.

 

“Related Loan” shall
mean a loan made to an Affiliate of Borrower or secured by a Related Property,
that is included in a Securitization with the Loan.

 

“Related Persons”
shall have the meaning set forth in Section 8.1.

 

“Related Property”
shall mean a parcel of real property, together with improvements thereon and
personal property related thereto, that is “related”, within the meaning of the
definition of Significant Obligor, to one or more Individual Properties.

 

“Release Amount”
shall mean, in connection with the release of any Individual Property from the
Lien of the Mortgage (or, in lieu of such release, the assignment of the
Mortgage encumbering any Individual Property), (a) one hundred five
percent (105%) of the Allocated
Loan Amount of the applicable Individual Property, which, when taken together
with the Allocated Loan Amount of each Individual Property previously released
from the Lien of the Mortgage (or, with respect to which Individual Property,
Lender previously assigned the applicable Mortgage), is less than or equal to
the Tranche I Release Percentage Threshold Amount, (b) one hundred ten
percent (110%) of the Allocated Loan Amount of the applicable Individual
Property, which, when taken together with the Allocated Loan Amount of each
Individual Property previously released from the Lien of the Mortgage (or, with
respect to which Individual Property, Lender previously assigned the applicable
Mortgage), is greater than the Tranche I Release Percentage Threshold Amount
and less than or equal to the Tranche II Release Percentage Threshold Amount,
or (c) one hundred fifteen percent (115%)
of the Allocated Loan Amount of the applicable Individual Property,
which, when taken together with the Allocated Loan Amount of each Individual
Property previously released from the Lien of the Mortgage (or, with respect to
which Individual Property, Lender previously assigned the applicable Mortgage),
equals an amount which is greater than the Tranche II Release Percentage
Threshold Amount; 

 

17

 

provided that, in each
case, the Release Amount shall not be greater than the amount of the Debt
outstanding on the date the applicable Individual Property is released from the
Lien of the Mortgage (or, in lieu of such release, the applicable Mortgage is
assigned) in accordance with the terms of this Agreement and the other Loan
Documents.

 

“Release Date” shall
mean the earlier to occur of (a) the third anniversary of the Closing Date
and (b) the date that is two (2) years from the “startup day” (within
the meaning of Section 860G(a)(9) of the Code) of the REMIC Trust
established in connection with the last Securitization involving any portion of
this Loan.

 

“Release Property”
shall mean any Individual Property (other than a Substituted Property) with
respect to which the Lien of the related Mortgage has been released (or
assigned) by Lender in accordance with the terms of this Agreement.

 

“REMIC Trust” shall
mean a “real estate mortgage investment conduit” within the meaning of Section 860D
of the Code that holds the Note.

 

“Rents” shall mean
all rents, moneys payable as damages or in lieu of rent, revenues, deposits
(including, without limitation, security, utility and other deposits),
accounts, cash, issues, profits, charges for services rendered, and other
consideration of whatever form or nature received by or paid to or for the
account of or benefit of Borrower, Manager or any of their agents or employees
from any and all sources arising from or attributable to the Property.  Notwithstanding the foregoing, “Rents” shall
exclude all receipts, revenues and other income generated from transportation
operations conducted or performed by Borrower or any of its Affiliates from or
with respect to any one or more Individual Properties.

 

“Required Repair Funds”
shall have the meaning set forth in Section 6.1.1.

 

“Required Repairs”
shall have the meaning set forth in Section 6.1.1.

 

“Reserve Funds” shall
mean, collectively, the Capital Expenditure Funds, the Insurance Funds, the
Required Repair Funds, if any, the Tax Funds and the
Borrower Cash Collateral Funds.

 

“Reserve Guaranty”
shall have the meaning set forth in Section 6.12(a).

 

“Resizing Event”
shall have the meaning set forth in Section 9.1(c).

 

“Restoration” shall
have the meaning set forth in Section 5.2.1.

 

“Restoration Threshold”
shall mean, with respect to each Individual Property, five percent (5%) of the Allocated Loan Amount for
each such Individual Property.

 

“S&P” shall mean
Standard & Poor’s Ratings Services, a division of the McGraw-Hill
Companies, Inc.

 

“Scheduled Defeasance
Payments” shall mean scheduled payments of interest and principal under the
Note in the case of a Total Defeasance Event and under the Defeased Note in 

 

18

 

the
case of a Partial Defeasance Event for all Monthly Payment Dates occurring
after the Defeasance Date and up to
and including the Monthly Payment Date referred to in clause (i) of the
definition of Partial Defeasance Collateral or Total Defeasance Collateral, as
applicable (including, in the case of a total defeasance, the outstanding
principal balance on the Note as of such Monthly Payment Date and, in the case
of a partial defeasance, the outstanding principal balance on the Defeased Note
as of such Monthly Payment Date).

 

“Secondary Market
Transaction” shall have the meaning set forth in Section 9.1(a).

 

“Securities” shall
have the meaning set forth in Section 9.1(a).

 

“Securities Act”
shall have the meaning set forth
in Section 9.2(a).

 

“Securitization”
shall have the meaning set forth in Section 9.1(a).

 

“Security Agreement”
shall mean that certain Security Agreement, dated as of the date hereof, made
by Borrower in favor of Lender, as the same may be amended, restated, replaced,
supplemented or otherwise modified from time to time.

 

“Service Contract”
shall have the meaning set forth in Section 5.3.2(i).

 

“Servicer” shall have
the meaning set forth in Section 11.24.

 

“Servicing Agreement”
shall have the meaning set forth in Section 11.24.

 

“Severed Loan Documents”
shall have the meaning set forth in Section 10.2(c).

 

“Significant Obligor”
shall have the meaning set forth in Item 1101(k) of Regulation AB under
the Securities Act.

 

“SPC Party” shall
have the meaning set forth in Section 3.1.24(o).

 

“State” shall mean,
with respect to any Individual Property, the State or Commonwealth in which
such Individual Property or any part thereof is located.

 

“Substitute Allocated
Loan Amount” shall have the meaning set forth in Section 11.29.

 

“Substitute Property” and “Substitute
Properties” shall have the respective meanings set forth in Section 11.29.

 

“Substituted Property”
shall have the meaning set forth in Section 11.29.

 

“Successor Borrower”
shall have the meaning set forth in Section 2.5.4.

 

“Survey” shall mean,
with respect to each Individual Property, a survey of such Individual Property
prepared by a surveyor licensed in the
State and satisfactory to Lender and 

 

19

 

the
company or companies issuing the Title Insurance Policy, and containing a
certification of such surveyor satisfactory to Lender.

 

“Tax Funds” shall have
the meaning set forth in Section 6.2.1.

 

“Taxes” shall mean
all real estate and personal property taxes, assessments, water rates or sewer
rents, now or hereafter levied or assessed or imposed against any Individual
Property or part thereof, together with all interest and penalties thereon.

 

“Tenant” shall mean
any Person obligated by contract or otherwise to pay monies (including a
percentage of gross income, revenue or profits) under any Lease now or
hereafter affecting all or any part of any Individual Property.

 

“Title Insurance Policy”
shall mean, with respect to each Individual Property, an ALTA mortgagee title
insurance policy in the form acceptable to Lender issued with respect to such
Individual Property and insuring the lien of the Mortgage encumbering such
Individual Property.

 

“Total Defeasance
Collateral” shall mean U.S. Obligations, which provide payments (i) on
or prior to, but as close as possible to, the Business Day immediately
preceding all Monthly Payment Dates under the Note after the Defeasance Date
and up to and including the Monthly Payment Date which Borrower shall specify
occurring concurrently with or after the Permitted Prepayment Date, and (ii) in
amounts equal to or greater than the Scheduled Defeasance Payments relating to
such Monthly Payment Dates.

 

“Total Defeasance Date”
shall have the meaning set forth in Section 2.5.1(a).

 

“Total Defeasance Event”
shall have the meaning set forth in Section 2.5.1(a).

 

“Tranche I Release
Percentage Threshold Amount” shall mean the product of the original
principal amount of the Loan and twelve and one-half percent (12.5%).

 

“Tranche II Release
Percentage Threshold Amount” shall mean the product of the original
principal amount of the Loan and twenty-five percent (25%).

 

“Transfer” shall have
the meaning set forth in the Mortgage.

 

“Transferee” shall
mean a Person to whom a Transfer is being effected.

 

“Treasury Rate” shall
mean, as of the Business Day immediately prior to the Prepayment Date, the
yield, calculated by Lender by linear interpolation (rounded to the nearest
one-thousandth of one percent (i.e., 0.001%) of the yields of
non-inflation adjusted noncallable United States Treasury obligations with
terms (one longer and one shorter) most nearly approximating the period from
such date of determination to the Permitted Prepayment Date, as determined by
Lender on the basis of Federal Reserve Statistical Release H.15-Selected
Interest Rates under the heading U.S. Governmental Security/Treasury Constant
Maturities, or another recognized source of financial market information
selected by Lender.  Lender’s
determination of the Treasury Rate shall be final absent manifest error.

 

20

 

“TRIA” shall mean the
Terrorism Risk Insurance Act of 2002,
as heretofore amended and as the same may be further amended or otherwise
modified; provided that it provides substantially the same benefits to
insurance companies and insureds as are provided by TRIA as in effect on the
Closing Date.

 

“Trigger Event” shall
mean, on the relevant date, the fact that the annual Underwritable Cash Flow
for the Property determined by Lender as of the end of each fiscal quarter
(based on Borrower’s Fiscal Year) on a trailing four (4) quarter basis is
less than the Trigger UCF Amount.

 

“Trigger Period”
shall mean a period commencing on the first (1st) Business Day
after a Trigger Event has occurred to the first (1st) Business Day
after the related Trigger Event has not existed for a period of two (2) consecutive
fiscal quarters.

 

“Trigger UCF Amount” shall mean,
as of any date, an amount equal to the aggregate of the Allocated UCF Trigger
Amounts of all the Individual Properties less the Allocated UCF Trigger Amount
of each Individual Property previously released from the lien of the Mortgage
(or, in lieu of such release, which Mortgage was assigned by Lender) pursuant
to Section 2.4 or Section 2.5.

 

“Trustee” shall mean
any trustee holding the Loan in a Securitization.

 

“UCC” or “Uniform
Commercial Code” shall mean the Uniform Commercial Code as in effect in the State.

 

“Underwritable Cash Flow”
shall mean the excess of Gross Revenue over Operating Expenses.  Lender’s calculation of Underwritable Cash
Flow (including determination of items that do not qualify as Gross Revenue or
Operating Expenses) shall be calculated by Lender based upon Lender’s
reasonable determination of Rating Agency criteria generally applied.

 

“Underwriter Group”
shall have the meaning set forth in Section 9.2(b).

 

“Updated Information”
shall have the meaning set forth in Section 9.l(b)(i).

 

“U.S. Obligations”
shall mean (i) direct full faith and credit obligations of the United
States of America and (ii) other “government securities” within the meaning
of section 1.860G-2(a)(8)(i) of the Treasury Regulations that are
acceptable to the Rating
Agencies and in each case that are not subject to prepayment, call or early
redemption.

 

“VNO” shall mean
Vornado Realty Trust, a Maryland real estate investment trust, and its
permitted successors by merger, consolidation or transfer of all or
substantially all of the assets of VNO, subject to any terms, covenants and/or
conditions of this Agreement.

 

“VRLP” shall mean
Vornado Realty L.P., a Delaware limited partnership, and its permitted
successors by merger, consolidation or transfer of all or substantially all of
the assets of VRLP, subject to any terms, covenants and/or conditions of this
Agreement.

 

21

 

“Warehouse Agreements”
shall mean warehousing agreements, logistics and services agreements,
distribution agreements, handling agreements and other similar agreements in connection with the use of one or
more Individual Properties as a dry and/or cold storage warehousing facility
and for such other uses as may be necessary or incidental to such use
(including, without limitation, the provision of distribution services), in
each case, to the extent (but only to the extent) the same are for goods stored
or services rendered at an Individual Property (excluding transportation
services), together with any and all amendments and modifications to such
agreements.

 

“YAA” shall mean
Yucaipa American Alliance Fund I, LP, a Delaware limited partnership, and its
permitted successors by merger, consolidation or transfer of all or
substantially all of the assets of YAA, subject to any terms, covenants and/or
conditions of this Agreement.

 

“YAP” shall mean
Yucaipa American Alliance (Parallel) Fund I, LP, a Delaware limited partnership,
and its permitted successors by merger, consolidation or transfer of all or
substantially all of the assets of YAP, subject to any terms, covenants and/or
conditions of this Agreement.

 

“YCI”
shall mean Yucaipa Corporate Initiatives Fund I, LP, a Delaware limited
partnership, and its permitted successors
by merger, consolidation or transfer of all or substantially all of the assets of
YCI, subject to any terms, covenants and/or conditions of this Agreement.

 

“Yield Maintenance
Premium” shall mean an amount equal to the greater of (a) one percent
(1%) of the principal amount of the Loan being prepaid or (b) the present value as of the Prepayment Date of the Calculated Payments
from the Prepayment Date through the Permitted Prepayment Date determined by
discounting such payments at the Discount Rate. 
As used in this definition, the term “Calculated Payments” shall
mean the monthly payments of interest only which would be due based on the
principal amount of the Loan being prepaid on the Prepayment Date and assuming
an interest rate per annum equal to the difference (if such difference is
greater than zero) between (i) the Applicable Interest Rate and (ii) the
Yield Maintenance Treasury Rate.  As used
in this definition, the term “Discount Rate” shall mean the rate which,
when compounded monthly, is equivalent to the Yield Maintenance Treasury Rate,
when compounded semi-annually.  As used
in this definition, the term “Yield Maintenance Treasury Rate” shall
mean the yield calculated by Lender by the linear interpolation of the yields,
as reported in the Federal Reserve Statistical Release H.15-Selected Interest
Rates under the heading U.S. Government Securities/Treasury Constant Maturities
for the week ending prior to the Prepayment Date, of U.S. Treasury Constant
Maturities with maturity dates (one longer or one shorter) most nearly
approximating the Permitted Prepayment Date. 
In the event Release H.15 is no longer published, Lender shall select a
comparable publication to determine the Yield Maintenance Treasury Rate.  In no event, however, shall Lender be
required to reinvest any prepayment proceeds in U.S. Treasury obligations or
otherwise.

 

Section 1.2            Principles of
Construction.  All references to sections and schedules
are to sections and schedules in or to this Agreement unless otherwise
specified.  Unless otherwise specified,
the words “hereof,” “herein” and “hereunder” and words of similar

 

22

 

import when used
in this Agreement shall refer to this Agreement as a whole and not to any
particular provision of this Agreement. 
Unless otherwise specified, all meanings attributed to defined terms
herein shall be equally applicable to both the singular and plural forms of the
terms so defined.

 

II.                                     THE LOAN

 

Section 2.1            The
Loan.

 

2.1.1            Agreement to Lend and
Borrow.  Subject to and upon the terms and
conditions set forth herein, Lender shall make the Loan to Borrower and
Borrower shall accept the Loan from Lender on the Closing Date.

 

2.1.2            Single Disbursement to
Borrower.  Borrower shall receive only one borrowing
hereunder in respect of the Loan and any amount borrowed and repaid hereunder
in respect of the Loan may not be reborrowed.

 

2.1.3            The Note.  The Loan shall be evidenced by the Note and shall be
repaid in accordance with the terms of this Agreement and the Note.

 

2.1.4            Use of Proceeds.  Borrower shall use proceeds of the Loan to (i) pay and
discharge any existing loans relating to the Property, (ii) pay all past
due Basic Carrying Costs, if any, in respect of the Property, (iii) deposit
the Reserve Funds (to the extent required hereunder and not previously
deposited), (iv) pay costs and expenses incurred in connection with the
closing of the Loan, (v) fund any working capital requirements of the Property,
(vi) distribute to its parent entities and (vii) retain and/or
distribute the balance, if any.

 

Section 2.2            Interest
Rate.

 

2.2.1            Applicable Interest Rate.  Except as herein provided with respect to interest accruing
at the Default Rate, interest on the principal balance of the Loan outstanding
from time to time shall accrue from the Closing Date up to, but excluding, the
Maturity Date at the Applicable Interest Rate.

 

2.2.2            Interest Calculation.  Interest on the outstanding principal balance of the Loan
shall be calculated by multiplying (a) the actual number of days elapsed
in the period for which the calculation is being made by (b) a daily rate
based on a three hundred sixty (360) day year (that is, the Applicable Interest
Rate or the Default Rate, as then applicable, expressed as an annual rate
divided by 360) by (c) the outstanding principal balance.  Notwithstanding the foregoing, prior to a
Securitization of the Loan, Lender shall have the right to adjust the Interest
Period; provided that, after giving effect to such adjustment, Borrower
shall not be obligated hereunder or under any other Loan Document to pay
interest on any prepaid or repaid principal of the Loan for any period from and
after the Monthly Payment Date concurrent with or subsequent to such prepayment
or repayment.  If requested by Lender,
Borrower shall promptly execute an amendment to this Agreement and any other
Loan Documents to evidence such change.

 

2.2.3            Intentionally
Omitted.

 

23

 

2.2.4            Usury Saving.  This Agreement and the other Loan Documents are subject to
the express condition that at no time shall Borrower be required to pay
interest on the principal balance of the Loan at a rate which could subject
Lender to either civil or criminal liability as a result of being in excess of
the Maximum Legal Rate.  If by the terms
of this Agreement or the other Loan Documents, Borrower is at any time required
or obligated to pay interest on the principal balance due hereunder at a rate in
excess of the Maximum Legal Rate, the Applicable Interest Rate or the Default
Rate, as the case may be, shall be deemed to be immediately reduced to the
Maximum Legal Rate and all previous payments in excess of the Maximum Legal
Rate shall be deemed to have been payments in reduction of principal and not on
account of the interest due hereunder. 
All sums paid or agreed to be paid to Lender for the use, forbearance,
or detention of the sums due under the Loan, shall, to the extent permitted by
applicable law, be amortized, prorated, allocated, and spread throughout the
full stated term of the Loan until payment in full so that the rate or amount
of interest on account of the Loan does not exceed the Maximum Legal Rate from
time to time in effect and
applicable to the Loan for so long as the Loan is outstanding.

 

Section 2.3            Loan
Payments.

 

2.3.1            Payment Before Maturity
Date.  Borrower shall make a payment to Lender of
interest only on the Closing Date for the initial Interest Period.  Borrower shall make a payment to Lender of
interest only in the amount of the Monthly Debt Service Payment Amount on the
Monthly Payment Date occurring in January 2007 and on each Monthly Payment
Date thereafter to and including the Maturity Date.  Each payment shall be applied first to accrued and unpaid interest
and the balance to principal.

 

2.3.2            Payment on Maturity Date.  Borrower shall pay to Lender on the Maturity Date the
outstanding principal balance of the Loan, all accrued and unpaid interest and
all other amounts due hereunder and under the Note, the Mortgage and the other
Loan Documents.

 

2.3.3            Interest Rate and
Payment after Default.  In the event that, and for so long as, any
Event of Default shall have occurred and be
continuing, the
outstanding principal balance of the Loan shall accrue interest at the Default
Rate, calculated from the date the Event of Default occurred.  If all or any part of the principal amount of
the Loan is prepaid upon acceleration of the Loan following the occurrence of
an Event of Default, Borrower shall be required to pay Lender, in addition to
all other amounts then payable hereunder (including, without limitation, (i) in
the event that such prepayment is received on a Monthly Payment Date, interest
which has accrued on such amount through such Monthly Payment Date, or (ii) in
the event that such prepayment is received on a date other than a Monthly
Payment Date, interest which would have accrued on such amount through the last
day of the Interest Period during which such prepayment occurs).

 

2.3.4            Late Payment Charge.  If any principal, interest or any other sum due under
the Loan Documents, other than the payment of principal due on the Maturity
Date, is not paid by Borrower on the date on which it is due such that the same
would constitute an Event of Default hereunder, Borrower shall pay to Lender
upon demand an amount equal to the lesser of five percent (5%) of such
unpaid sum or the maximum amount permitted by applicable law in

 

24

 

order to defray
the expense incurred by Lender in handling and processing such delinquent
payment and to compensate Lender for the loss of the use of such delinquent
payment.  Any such amount shall be
secured by the Mortgage and the other Loan Documents.

 

2.3.5            Method and Place of Payment.  (a) Except as otherwise specifically provided herein, all
payments and prepayments under this Agreement and the Note shall be made to
Lender not later than 1:00 P.M., New York City time, on the date when due and shall be made in lawful money of
the United States of America in immediately available funds at Lender’s office,
and any funds received by Lender after such time shall, for all purposes hereof
be deemed to have been paid on the next succeeding Business Day.  Notwithstanding the foregoing, amounts due
for the payment of Debt Service under the Loan Documents shall be deemed paid
so long as there are sufficient sums on deposit in the Deposit Account (as
defined in the Cash Management Agreement) for payment of such amounts and
Lender’s access to such funds has not been inhibited or prevented in any manner
whatsoever due to circumstances or events which are directly or indirectly
caused by or otherwise relate to any actions or omissions of Borrower or any of
its Affiliates.

 

(b)           Whenever any payment
to be made hereunder or under any other Loan Document shall be stated to be due
on a day which is not a Business Day, the due date thereof shall be the
Business Day immediately preceding such day.

 

(c)           All payments
required to be made by Borrower
hereunder or under the Note or the other Loan Documents shall be made
irrespective of, and without deduction for, any setoff, claim or counterclaim
(other than a compulsory counterclaim), and any payment required under the Note
and the other Loan Documents shall be made Irrespective of any defense thereto.

 

Section 2.4            Prepayments.

 

2.4.1            Voluntary Prepayments.  (a) On and after the Permitted Prepayment Date, Borrower
may, at its option, prepay the Debt in whole but not in part on any Business Day, without payment of any Yield
Maintenance Premium, provided, the following conditions are satisfied:

 

(i)            Borrower shall provide prior written
notice to Lender specifying the date upon which the prepayment is to be made,
which notice shall be delivered to Lender not less than ten (10) Business Days prior to such
Prepayment Date (or such shorter period of time as may be permitted by Lender in its sole discretion).  Borrower’s notice of prepayment shall create
an obligation of Borrower to prepay the Loan or a portion thereof as set forth
therein, but may be rescinded by a written notice to Lender prior to the
applicable Prepayment Date.  Borrower
agrees to indemnify Lender and to hold Lender harmless from and against any and
all costs and expenses Lender sustains or incurs as a consequence of any such
rescission of a notice of prepayment; and

 

(ii)           If such prepayment is made on a day
other than a Monthly Payment Date, then in connection with such prepayment
Borrower shall pay to Lender, simultaneously with such prepayment, all interest
on the principal balance of this Note then being prepaid which would have
accrued through the last day of the Interest Period during

 

25

 

which such prepayment occurs.  Any prepayment received by Lender on a date
other than a Monthly Payment Date shall be held by Lender (and the interest
shall accrue for the benefit of Borrower as collateral security for the Loan
and shall be applied to the Debt on the next Monthly Payment Date.

 

(b)           Upon payment in full
of all principal and interest due on the Loan and all other amounts due and
payable under the Note and the other Loan Documents in accordance with the
terms and provisions of the Loan Documents, upon the written request of Borrower,
Lender shall (i) release the Lien of the Mortgages and all other security
interests granted herein and under the other Loan Documents pursuant to an
instrument or other document in form and substance reasonably satisfactory to
Lender or (ii)(A) assign, or sever into two (2) or more separate
loans and assign, the Mortgages and the other Loan Documents to any Person
designated by Borrower, which assignment and severance documents shall be in
recordable form, (B) deliver to or as directed by Borrower the original
executed Note and all originally executed other notes which may have been
consolidated, amended and/or restated in connection with the execution of the
Note or, with respect to any note where the original has been lost, destroyed
or mutilated, a lost note affidavit for the benefit of the assignee lender and
the title insurance company insuring the Mortgages, as assigned, in form
sufficient to permit such title insurance company to insure the lien of the
Mortgages as assigned to and held by the assignee without exception for any
matter relating to the lost, destroyed or mutilated note; provided that
in no event shall Lender be required to deliver any indemnity with respect
thereto, (C) execute and deliver an allonge with respect to the Note and
any other note(s) described in the clause (B) above, (D) deliver the original recorded copies of the Mortgages in Lender’s possession
or, at Borrower’s sole cost and expense, certified copies of record, and (E) execute
and deliver such other instruments of conveyance, assignment, termination,
severance and release (including appropriate UCC statements) in recordable form
as may reasonably be requested by Borrower to evidence such assignment and/or
severance, provided, in each case, without covenant, recourse, representation
(other than representations that such assignment has been duly authorized and
that Lender has not otherwise assigned or encumbered the Mortgages or the other
Loan Documents except as expressly contemplated therein) or warranty by Lender
and notwithstanding anything to the contrary contained herein, pursuant to
instruments or other documents in form and substance reasonably satisfactory to
Lender. Concurrently with the payment to Lender of all principal and interest
on, and all other amounts due and payable under the Note and the other Loan
Documents, and whether or not Borrower shall request a release or an assignment
as set forth in this Section 2.4.1(b), Lender shall deliver to Borrower (1) a payoff
letter in customary form, (2) all original insurance policies relating to
the Property held by or on behalf of Lender, (3) any amounts held in escrow or in any
reserve account pursuant to the Loan Documents or otherwise, (4) any other
collateral that may have been delivered to Lender in connection with the Loan,
and (5) a termination (subject to customary “clawback”
provisions) of any guaranties delivered to Lender in connection with the Loan
(except to the extent of any obligations thereunder that are expressly intended
to survive pursuant to the terms thereof), duly executed by Lender, in each
case with respect to clause (1) or (5), in form and substance reasonably
satisfactory to Lender.  In connection
with any transaction contemplated by this Section 2.4.1(b),
Borrower shall submit to Lender for its review, not less than ten (10) Business
Days prior to the date of any release or assignment of the Mortgages or the
payment in full of the Debt (or such shorter period of time as may be permitted
by Lender in its sole discretion), all instruments and documents to be executed
by Lender (other than a payoff letter under clause (1) above).  All

 

26

 

reasonable
out-of-pocket costs and expenses incurred by Lender pursuant to this Section 2.4.1(b) shall
be paid by Borrower (other than any costs and expenses incurred by Lender in
connection with the preparation and delivery of a lost note affidavit in
accordance with clause (ii)(B) above or a payoff letter as contemplated by
clause (1) above and provided that in no event shall Borrower be required
to pay any fee or premium in connection herewith).

 

(c)           Following either the
occurrence and during the continuance of (x) a Default (other than a
monetary Default) for which Lender has given written notice to Borrower or (y) an
Event of Default which, in either case, cannot be cured despite Borrower’s
commercially reasonable efforts (but which Default or Event of Default would be
cured or eliminated by the release of any Individual Property (or, in lieu of
such release, an assignment of the Mortgage encumbering such Individual
Property)), Borrower shall have the right, prior to the Release Date, to prepay
a portion of the Debt and obtain the release of such Individual Property from
the Lien of the applicable Mortgage (or, in lieu of such release, obtain an
assignment of the Mortgage encumbering such Individual Property), provided the
following conditions are satisfied:

 

(i)            Borrower shall provide prior written
notice to Lender specifying the date upon which the prepayment is to be made,
which notice shall be delivered to Lender not less than ten (10) Business
Days prior to such Prepayment Date (or such shorter period of time as may be
permitted by Lender in its sole discretion). 
Borrower’s notice of prepayment shall create
an obligation of
Borrower to prepay the Loan or a portion thereof as set forth therein, but may
be rescinded by a written notice to Lender prior to the applicable Prepayment
Date.  Borrower agrees to indemnify
Lender and to hold Lender harmless from and against any and all costs and
expenses Lender sustains or incurs as a consequence of any such rescission of a
notice of prepayment;

 

(ii)           If such prepayment is made on a day
other than a Monthly Payment Date, then in connection with such prepayment
Borrower shall pay to Lender, simultaneously with such prepayment, all interest
on the principal balance of the Note then being prepaid which would have
accrued through the last day of the Interest Period during which such
prepayment occurs.  Any prepayment
received by Lender on a date other than a Monthly Payment Date shall be held by
Lender (and the interest shall accrue for the benefit of and shall be payable
to Borrower) as collateral security for the Loan and shall be applied to the
Debt on the next Monthly Payment Date;

 

(iii)          In connection with the release of any
Individual Property (or the assignment of the Mortgage encumbering such
Individual Property), Lender shall have received (A) payment of the
applicable Release Amount, (B) payment of the Yield Maintenance Premium
with respect to the portion of the Loan to be prepaid and (C) payment of
any other amounts then due and owing to Lender pursuant to this Agreement and
the other Loan Documents;

 

(iv)          Immediately after giving effect to
such prepayment and the release of the applicable Individual Property from the
Lien of the related Mortgage (or, in lieu of such release, the assignment of
the Mortgage encumbering such Individual Property), no

 

27

 

Default or Event of Default shall have occurred and be
continuing (excluding any Default or Event of Default arising from the released
Individual Property);

 

(v)           In connection with the release of an
Individual Property pursuant to this Section 2.4.1(c),
Borrower shall submit to Lender for its review, not less than ten (10) Business
Days prior to the date of such release (or such shorter
period of time as may
be permitted by Lender in its sole
discretion), a
partial release of the applicable Mortgage and the related Loan Documents to be
executed by Lender. Such release shall be in a form appropriate for the
jurisdiction in which such Individual Property
is located and
otherwise reasonably acceptable to Lender;

 

(vi)          In lieu of a release of an Individual
Property in accordance with clause (v), upon Borrower’s written request not less than ten (10) Business Days prior to the date of
the proposed assignment (or such shorter period of time
as may be permitted
by Lender in its sole discretion), Lender shall (A) sever the Note and
assign or endorse over a severed note in the amount equal to the Release Amount
for such Individual Property and assign the applicable Mortgage to any Person
designated by Borrower, which assignment and severance documents shall be in
recordable form, (B) deliver to or as directed by Borrower the original
executed severed note, (C) deliver the original recorded
copy of the applicable Mortgage in Lender’s possession or, at Borrower’s sole
cost and expense, a certified copy of record, and (D) execute and deliver such
other instruments of conveyance, assignment, termination, severance and release
(including appropriate UCC statements) in recordable form as may reasonably be
requested by Borrower to evidence such assignment and/or severance, provided,
in each case, without covenant, recourse, representation (other than
representations that such assignment has been duly authorized and that Lender
has not otherwise assigned or encumbered the applicable Mortgage except as
expressly contemplated therein) or warranty by Lender and notwithstanding
anything to the contrary contained herein, pursuant to instruments or other
documents in form and substance reasonably satisfactory to Lender.  Borrower shall provide all other
documentation Lender reasonably requires to be delivered by Borrower in
connection with such severance and assignment (including, without limitation, a
severed note in the amount equal to the principal balance of the Loan after
giving effect to such assignment), together with an Officer’s Certificate
certifying that such severance and assignment will not impair or otherwise
adversely affect the Liens, security interests and other rights of Lender under
the Loan Documents not being assigned (or as to the parties to the Loan
Documents and the Individual Properties subject to the Loan Documents not being
assigned).  In connection with any
transaction contemplated by this Section 2.4.1(c)(vi), Borrower
shall submit to Lender for its review, not less than ten (10) Business
Days prior to the date of any assignment of a Mortgage (or such shorter period
of time as may be permitted by Lender in its sole discretion), all instruments
and documents to be executed by Lender;

 

(vii)         Simultaneously with the release (or
assignment), (A) Borrower shall convey its title to the applicable
Individual Property to a Person other than Borrower and (B) Borrower and
Manager shall execute an amendment to the Management Agreement effective as of
such release (or assignment) deleting the applicable Individual Property from
the list of properties managed thereunder;

 

28

 

(viii)        Borrower shall deliver an Officer’s
Certificate certifying that the requirements set forth in this Section 2.4.1(c) have
been satisfied; and

 

(ix)           All reasonable out-of-pocket costs
and expenses incurred by Lender pursuant to this Section 2.4.1(c) shall
be paid by Borrower

 

2.4.2            Mandatory Prepayments.  (a)  On each date on which Lender actually receives a
distribution of Net Proceeds, and if Lender exercises its right provided for
herein not to make such Net Proceeds available to Borrower for a Restoration,
one hundred percent (100%) of such Net Proceeds shall be applied to the
outstanding principal balance of the Loan, together with interest accruing on
such amount calculated through the next Monthly Payment Date.  Any prepayment received by Lender pursuant to
this Section 2.4.2 on a date other than a Monthly Payment Date
shall be held by Lender as collateral security for the Loan in an interest
bearing account, with such interest accruing to the benefit of and payable to
Borrower, and shall be applied by Lender on the next Monthly Payment Date.  The Allocated Loan Amount of an applicable
Individual Property shall be reduced by an amount equal to such prepayment of
principal upon such application of Net Proceeds pursuant to this Section 2.4.2.  Notwithstanding the foregoing and anything
else herein to the contrary, if in connection
with any Casualty or Condemnation at any Individual Property Lender exercises
its right provided for herein not to make the Net Proceeds available to
Borrower for a Restoration, then at Borrower’s option, Lender shall release the
applicable Individual Property from the lien of the Mortgage and related Loan
Documents (or, in lieu of such release, the assignment of the related Mortgage
by Lender on substantially the same terms as are provided in Section 2.4.1(c)),
provided that (i) Borrower shall pay Lender an amount which, when
added to the amount of Net Proceeds received in connection with such Casualty
or Condemnation, equals the Allocated Loan Amount of the Individual Property
for which the Net Proceeds were obtained together with interest on such amount
calculated for the same periods as Net Proceeds in the first sentence of this Section 2.4.2, (ii) no
Event of Default shall have occurred and be continuing (except for any Event of
Default which would be cured or eliminated by the release or assignment of the
Individual Property, (iii) Borrower shall provide to Lender a release of
the Mortgage as it relates to such individual Property and related Loan
Documents in a form appropriate for the jurisdiction in which the applicable
Individual Property is located and reasonably satisfactory to Lender for
execution by Lender and (iv) simultaneously with the release, Borrower
shall convey fee simple title to the Release Property to a Person other than
Borrower.

 

(b)           Any prepayment of
the Loan pursuant to this Section 2.4.2 shall be without premium
(including Yield Maintenance Premium) or penalty of any kind.

 

2.4.3            Prepayments After Default.  Subject to the terms set forth in Section 2.4.1(c),
if, after an Event of Default, payment of all or any part of the principal of
the Loan is tendered by Borrower, a purchaser at foreclosure or any other
Person, such tender shall be deemed an attempt to circumvent the prohibition
against prepayment set forth in Section 2.4.1 and Borrower, such
purchaser at foreclosure or other Person shall pay, in addition to the
outstanding principal balance, all accrued and unpaid interest and other
amounts payable under the Loan Documents, an amount equal to the applicable
Yield Maintenance Premium, if any.

 

29

 

Section 2.5            Defeasance.

 

2.5.1            Total Defeasance.  (a) Provided no Event of Default shall have occurred and
remain uncured, Borrower shall have the right at any time after the Release
Date and prior to the Permitted Prepayment Date to voluntarily defease the
entire Loan and obtain a release of the lien of the Mortgage by providing Lender with the Total Defeasance
Collateral (hereinafter, a “Total Defeasance Event”), subject to the
satisfaction of the following conditions precedent:

 

(i)            Borrower shall provide Lender not
less than fifteen (15) Business Days’ notice (or such shorter
period of time as may be permitted by Lender in its sole discretion) specifying a date (the “Total
Defeasance Date”) on which the Total Defeasance Event is to occur.  Borrower’s notice of defeasance shall create
an obligation of Borrower to defease the entire Loan as set forth therein, but
may be rescinded by a written notice to Lender prior to the applicable Total
Defeasance Date.  Borrower agrees to indemnify Lender and to hold Lender
harmless from and against any and all costs and expenses Lender sustains or
incurs as a consequence of any such rescission of a notice of defeasance;

 

(ii)           Borrower shall pay to Lender (A) all
payments of principal and interest due on the Loan to and including the Total
Defeasance Date and (B) all other sums, then due under the Note, this
Agreement, the Mortgage and the other Loan Documents;

 

(iii)          Borrower shall deposit the Total
Defeasance Collateral into the Defeasance Collateral Account and otherwise
comply with the provisions of Sections 2.5.3  and 2.5.4  hereof;

 

(iv)          Borrower shall execute and deliver to
Lender a Defeasance Security Agreement in respect of the Defeasance Collateral
Account and the Total Defeasance Collateral;

 

(v)           Borrower shall deliver to Lender an
opinion of counsel for Borrower that is standard in commercial lending
transactions and subject only to customary qualifications, assumptions and
exceptions opining, among other things, (A) that Lender has a legal and
valid perfected first priority security interest in the Defeasance Collateral
Account and the Total Defeasance Collateral, (B) that, if a Securitization
has occurred, the REMIC Trust formed pursuant to such Securitization will not
fail to maintain its status as a “real estate mortgage investment conduit”
within the meaning of Section 860D of the Code as a result of a Total
Defeasance Event pursuant to this Section 2.5  (assuming a “startup day” (within the
meaning of Section 860G(a)(9) of the Code) that is the earlier of the
actual start-up date and the date specified in clause (a) of the
definition of “Release Date” contained herein), and (C) a
non-consolidation opinion with respect to the Successor Borrower;

 

(vi)          If a Securitization has occurred,
Borrower shall deliver to Lender a Rating Agency Confirmation as to the Total
Defeasance Event;

 

(vii)         Borrower shall deliver an Officer’s
Certificate certifying that the requirements set forth in this Section 2.5  have been satisfied;

 

30

 

(viii)        Borrower shall deliver a certificate of
a “big four” or other nationally recognized public accounting firm acceptable
to Lender certifying that the Total Defeasance Collateral will generate monthly
amounts equal to or greater than the Scheduled Defeasance Payments;

 

(ix)           Intentionally omitted;

 

(x)            Borrower shall deliver such other
certificates, opinions, documents and instruments as Lender may reasonably
request; and

 

(xi)           Borrower shall pay all reasonable
out-of-pocket costs and expenses of Lender incurred in connection with the
Total Defeasance Event, including Lender’s reasonable attorneys’ fees and
expenses and Rating Agencies’ fees and expenses.

 

(b)           If Borrower has
elected to defease the entire Note and the requirements of this Section 2.5
have been satisfied, the Property shall be released from the lien of the
Mortgage and the Total Defeasance Collateral pledged pursuant to the Defeasance
Security Agreement shall be the sole source of collateral securing the Note.  In connection with the release of the Lien,
Borrower shall submit to Lender for its review, not less than fifteen (15) days
prior to the Defeasance Date (or such shorter period of time as may be
permitted by Lender in its sole discretion), a release of Lien (and related
Loan Documents) to be executed by Lender. Such release shall be in a form
appropriate in the applicable jurisdiction(s) in which the Property is
located and that contains standard provisions protecting the rights of the
releasing lender.  In addition, Borrower
shall provide all other documentation that a reasonably prudent lender
originating commercial loans for securitization similar to the Loan would
require to be delivered by Borrower in connection with such release, together
with an Officer’s Certificate certifying that such documentation (i) is in
compliance with all Legal Requirements, and (ii) will effect such release
in accordance with the terms of this Agreement. 
Borrower shall pay all costs, taxes and expenses associated with the
release of the lien of the Mortgage, including Lender’s reasonable attorneys’
fees.  Except as set forth in Section 2.4
or this Section 2.5, no repayment, prepayment or defeasance of all
or any portion of the Note shall cause, give rise to a right to require, or
otherwise result in, the release of the lien of the Mortgage on the Property.

 

(c)           If Borrower has
elected to defease the entire Note and the requirements of this Section 2.5  have been satisfied, in lieu of the
release of the Property in accordance with Section 2.5.1(b), upon
Borrower’s written request not less than fifteen (15) days prior to the date of
the proposed assignment (or such shorter period of time as may be permitted by
Lender in its sole discretion), Lender shall (i) assign, or sever into two
(2) or more separate loans and assign, the Mortgages and the other Loan
Documents to any Person designated by Borrower, which assignment and severance
documents shall be in recordable form, (ii) deliver to or
as directed by Borrower the original executed Note and all originally executed
other notes which may have been consolidated, amended and/or restated in
connection with the execution of the Note or, with respect to any note where
the original has been lost, destroyed or mutilated, a lost note affidavit for
the benefit of the assignee lender and the title insurance company insuring the
Mortgages, as assigned, in form sufficient to permit such title insurance
company to insure the lien of the Mortgages
as assigned to and held by the assignee without exception for any matter
relating to the lost, destroyed or mutilated note; provided that in no event shall Lender be required to deliver 

 

31

 

any indemnity with
respect thereto, (iii) execute and deliver an allonge with respect to the
Note and any other note(s) described in the clause (ii) above, (iv) deliver
the original recorded copies of the Mortgages in Lender’s possession or, at
Borrower’s sole cost and expense, certified copies of record, and (v) execute
and deliver such other instruments of conveyance, assignment, termination,
severance and release (including appropriate UCC statements) in recordable form
as may reasonably be requested by Borrower to evidence such assignment and/or
severance, provided, in each case, without covenant, recourse, representation
(other than representations that such assignment has been duly authorized and
that Lender has not otherwise assigned or encumbered the Mortgages or the other
Loan Documents except as expressly contemplated therein) or warranty by Lender
and notwithstanding anything to the contrary contained herein, pursuant to
instruments or other documents in form and substance reasonably satisfactory to
Lender. Concurrently with the delivery of the Total Defeasance Collateral to
Lender, and whether or not Borrower shall request a release or an assignment as
set forth in this Section 2.5.1, Lender
shall deliver to Borrower (1) a payoff letter in customary form, (2) all
original insurance policies relating to the Property held by or on behalf of Lender, (3) any
amounts held in escrow or in any reserve account pursuant to the Loan Documents
or otherwise, (4) any other collateral that may have been delivered to
Lender in connection with the Loan, and (5) a termination (subject to customary “clawback”
provisions) of any guaranties delivered to Lender
in connection with
the Loan (except to the extent of any obligations thereunder that are expressly
intended to survive pursuant to the terms thereof), duly executed by Lender, in
each case with respect to clause (1) or (5), in form and substance
reasonably satisfactory to Lender.  In
connection with any transaction contemplated by this Section 2.5.1(c),
Borrower shall submit to Lender for its review, not less than fifteen (15) days
prior to the Defeasance Date (or such shorter period of time as may be
permitted by Lender in its sole discretion), all instruments and documents to
be executed by Lender (other than a payoff letter under clause (1) above).  All reasonable out-of-pocket costs and
expenses incurred by Lender pursuant to this Section 2.5.1(c) shall be paid by Borrower (other than any
costs and expenses incurred by Lender in connection with the preparation and
delivery of a lost note affidavit in accordance with clause (ii) above or
a payoff letter as contemplated by clause (1) above and provided
that in no event shall Borrower be required to pay any fee or premium to the
Lender or the Servicer in connection herewith).

 

2.5.2            Partial Defeasance.  (a) Provided
no Event of Default shall have occurred and remain uncured, Borrower shall have
the right at any time after the Release Date and prior to Permitted Prepayment Date to voluntarily
defease a portion of the Loan and obtain a release of the lien of the Mortgage
as to any Individual Property by providing Lender with the Partial Defeasance
Collateral (hereinafter, a “Partial Defeasance Event”) upon satisfaction
of the following conditions precedent:

 

(i)            Borrower shall provide Lender not
less than fifteen (15) Business Days notice (or such shorter period
of time as may be permitted by Lender in its sole discretion) specifying a date
(the “Partial Defeasance Date”) on which the Partial Defeasance is to occur.  Borrower’s notice of defeasance shall create
an obligation of Borrower to defease a portion of the Loan as set forth
therein, but may be rescinded by a written notice to Lender prior to the
applicable Partial Defeasance Date. 
Borrower agrees to indemnify Lender and to hold Lender harmless from and
against any and all costs and expenses Lender sustains or incurs as a
consequence of any such rescission of a notice of defeasance;

 

32

 

(ii)           Borrower shall pay to Lender (A) all
payments of principal and interest due on the Loan to and including the Partial
Defeasance Date and (B) all other sums then due under the Note, this
Agreement, the Mortgage and the other Loan Documents;

 

(iii)          Borrower shall deposit the Partial
Defeasance Collateral into the Defeasance Collateral Account and otherwise
comply with the provisions of Sections 2.5.3 and 2.5.4 hereof;

 

(iv)          Borrower shall prepare all necessary
documents to modify this Agreement and to amend and restate the Note and issue
two substitute notes, one note having an aggregate principal balance equal to
Release Amount for the subject Individual Property (collectively, the “Defeased
Note”), and the other note having a principal balance equal to the excess
of (A) the original principal amount of the Loan, over (B) the amount
of the Defeased Note (collectively, the “Undefeased Note”).  The Defeased Note and Undefeased Note shall
have identical terms as the Note except for the principal balance.  The Defeased Note and the Undefeased Note
shall not be cross defaulted or cross collateralized unless the Rating Agencies
shall require otherwise.  A Defeased Note
may not be the subject of any further defeasance (but may be prepaid on the
same terms as the Note);

 

(v)           Borrower shall execute and deliver to
Lender a Defeasance Security Agreement in respect of the Defeasance Collateral
Account and the Partial Defeasance Collateral;

 

(vi)          Borrower shall deliver to Lender an
opinion of counsel for Borrower that is standard in commercial lending
transactions and subject only to customary qualifications, assumptions and
exceptions opining, among other things, (A) that Lender has a legal and
valid perfected first priority security interest in the Defeasance Collateral
Account and the Partial Defeasance Collateral, (B) that, if a
Securitization has occurred, the REMIC Trust formed pursuant to such
Securitization will not fail to maintain its status as a “real estate mortgage
investment conduit” within the meaning of Section 860D of the Code as a
result of the Partial Defeasance Event pursuant to this Section 2.5.2
(assuming a “startup day” (within the meaning of Section 860G(a)(9) of
the Code) that is the earlier of the actual start-up date and the date
specified in clause (a) of the definition of “Release Date” contained
herein), and (C) a non-consolidation opinion with respect to the Successor
Borrower;

 

(vii)         Borrower shall deliver to Lender a
Rating Agency Confirmation as to the Partial Defeasance Event;

 

(viii)        Borrower shall deliver to Lender a
certificate of a “big four” or other nationally recognized public accounting
firm acceptable to Lender certifying that the Partial Defeasance Collateral
will generate monthly amounts equal to or greater than the Scheduled Defeasance
Payments;

 

(ix)           Borrower shall deliver to Lender an
Officer’s Certificate certifying that
the requirements set forth in this Section 2.5.2(a) have
been satisfied;

 

33

 

(x)            After giving effect to the release
of any Individual Properties (including the amount prepaid in Section 2.5.2(a)(ii) above
and including any amount so paid in excess of 100% of the Allocated Loan Amount
for any such Release Properties), the Debt Service Coverage Ratio for the Loan
for the Individual Properties (excluding the Released Property) shall not be less than the greater of (i) the
Debt Service Coverage Ratio as of the Closing Date for the Property as of the
Closing Date and (ii) the Debt Service Coverage Ratio for the trailing
twelve (12) full calendar months as of the date immediately preceding the
release of the Release Properties for the Property as of such date; provided
that, in order to meet the Debt Service Coverage Ratio Test set forth in this
clause (x), Borrower may defease a portion of the Loan in excess of the Release Amounts of the
affected Individual Properties;

 

(xi)           Borrower shall continue to comply
with the terms and provisions of Section 3.1.24;

 

(xii)          Borrower shall pay all reasonable
out-of-pocket costs and expenses of Lender incurred in connection with the
Partial Defeasance Event, including Lender’s reasonable attorneys’ fees and
expenses, the Rating Agencies’ fees and expenses and any fees assessed by the
Servicer in connection with such Partial Defeasance Event.

 

(b)           If Borrower has
elected to make a partial defeasance and the requirements of this Section 2.5
have been satisfied, the Individual Property shall be released from the lien of
the Mortgage.  In connection with the
release of the Lien, Borrower shall submit to Lender for its review, not less
than fifteen (15) days prior to
the Partial Defeasance Date (or such shorter period of time as may be permitted
by Lender in its sole discretion), a release of Lien (and related Loan
Documents) to be executed by Lender. Such release shall be in a form
appropriate in the jurisdiction in which the Property is located and that contains
standard provisions protecting the rights of the releasing lender.  In addition, Borrower shall provide all other
documentation that a reasonably prudent lender originating commercial loans for
securitization similar to the Loan would reasonably require to be delivered by
Borrower in connection with such release, together with an Officer’s
Certificate certifying that such documentation (i) is in compliance with
all Legal Requirements, and (ii) will effect such release in accordance
with the terms of this Agreement. 
Borrower shall pay all taxes and all reasonable costs and expenses
associated with the release of the lien of the Mortgage, including Lender’s
reasonable attorneys’ fees.  Borrower
shall cause title to the Individual Property so released from the lien of the
Mortgage to be transferred to and held by a Person other than Borrower.  Except as set forth in Section 2.4
or this Section 2.5, no repayment, prepayment or
defeasance of all or any portion of the Note shall cause, give rise to a right
to require, or otherwise result in, the release of the lien of the Mortgage
from the Property or any part thereof.

 

(c)           If Borrower has
elected to make a partial defeasance and the requirements of this Section 2.5  have been satisfied, in lieu of the release
of the Individual Property in accordance with Section 2.5.2(b),
upon Borrower’s written request not less than fifteen (15) days prior to the
date of the proposed assignment (or such shorter period of time as may be
permitted by Lender in its sole discretion), Lender shall (i) sever the
Note and assign or endorse over a severed note in the amount equal to the
Release Amount for such Individual Property and assign the applicable Mortgage
to any Person designated by Borrower, which assignment and severance 

 

34

 

documents shall be
in recordable form, (ii) deliver to or as directed by Borrower the
original executed severed note, (iii) deliver the original recorded copy
of the applicable Mortgage in Lender’s possession or, at Borrower’s sole cost
and expense, a certified copy of record, and (iv) execute and deliver such
other instruments of conveyance, assignment, termination, severance and release
(including appropriate UCC statements) in recordable form as may reasonably be
requested by Borrower to evidence such assignment and/or severance, provided,
in each case, without covenant, recourse, representation (other than
representations that such assignment has been duly authorized and that Lender
has not otherwise assigned or encumbered the applicable Mortgage except as
expressly contemplated therein) or warranty by Lender and notwithstanding
anything to the contrary contained herein, pursuant to instruments or other
documents in form and substance reasonably satisfactory to Lender.  In connection with any transaction
contemplated by this Section 2.5.2(c), Borrower shall submit to
Lender for its review, not less than fifteen (15)
days prior to the
date of any assignment of a Mortgage (or such shorter period of time as may be
permitted by Lender in its sole discretion), all instruments and documents to
be executed by Lender.  In addition,
Borrower shall provide all other documentation Lender reasonably requires to be
delivered by Borrower in connection with such severance and assignment
(including, without limitation, a severed note in the amount equal to the
principal balance of the Loan after giving effect to such assignment), together
with an Officer’s Certificate certifying that such severance and assignment
will not impair or otherwise adversely affect the Liens, security interests and
other rights of Lender under the Loan Documents not being assigned (or as to
the parties to the Loan Documents and the Individual Properties subject to the
Loan Documents not being assigned).  All
reasonable out-of-pocket costs and expenses incurred by Lender pursuant to this
Section 2.5.2(c) shall be paid by Borrower; provided
that in no event shall Borrower be required to pay any fee or premium to the
Lender or the Servicer in connection therewith.

 

2.5.3            Defeasance Collateral Account.  On or before the date on which Borrower delivers the
Total Defeasance Collateral or Partial Defeasance Collateral, Borrower shall
open at any Eligible Institution the defeasance collateral account (the “Defeasance
Collateral Account”) which shall at all times be an Eligible Account.  The Defeasance Collateral Account shall
contain only (a) Total Defeasance Collateral or the applicable Partial
Defeasance Collateral, and (b) cash from interest and principal paid on
the Total Defeasance Collateral or the applicable Partial Defeasance
Collateral.  All cash from interest and
principal payments paid on the Total Defeasance Collateral or Partial
Defeasance Collateral shall be paid over to Lender on each Monthly Payment Date
and applied first to accrued and unpaid interest and then to principal.
Following the payment of all Scheduled Defeasance Payments, any cash from
interest and principal paid on the Total Defeasance Collateral or Partial
Defeasance Collateral in excess of the amounts necessary to pay the Scheduled
Defeasance Payments shall be paid to Borrower or, if there is a Successor
Borrower, to Successor Borrower. 
Borrower shall cause the Eligible Institution at which the Total
Defeasance Collateral or Partial Defeasance
Collateral is
deposited to enter into an agreement with Borrower or Successor Borrower, as
applicable, and Lender, satisfactory to Lender in its reasonable discretion,
pursuant to which such Eligible institution shall agree to hold and distribute
the Total Defeasance Collateral or Partial Defeasance Collateral in accordance
with this Agreement.  Borrower or
Successor Borrower, as applicable, shall be the owner of the Defeasance
Collateral Account and shall report all income accrued on Total Defeasance
Collateral or Partial Defeasance Collateral for federal, state and local income
tax purposes in its income tax return. 
Borrower shall prepay or cause to be prepaid all costs and

 

35

 

expenses associated
with opening and maintaining the Defeasance Collateral Account.  Lender shall not in any way be liable by
reason of any insufficiency in the Defeasance Collateral Account. At Borrower’s
election, different Defeasance Collateral Accounts may be established for each
defeasance consummated pursuant to Section 2.5.1  or Section 2.5.2.

 

2.5.4            Successor Borrower.  In connection with a Defeasance Event under this Section 2.5,
Borrower shall, if required by the Rating Agencies or if Borrower elects to do
so, establish or designate a successor entity (the “Successor Borrower”)
which shall be a single purpose bankruptcy remote entity and which shall be
approved by the Rating Agencies.  Any
such Successor Borrower may, at Borrower’s
option, be an Affiliate of Borrower. 
Borrower shall transfer and assign all obligations, rights and duties
under and to the Note or the Defeased Note, as applicable, together with the
Total Defeasance Collateral or Partial Defeasance Collateral, as applicable, to
such Successor Borrower. Such Successor Borrower shall assume the obligations
under the Note or the Defeased Note, as applicable, and the Defeasance Security
Agreement and Borrower shall be relieved of its obligations under such
documents except to the extent of any cross-collateralization required
hereunder.  Borrower shall pay all
reasonable out-of-pocket costs and expenses incurred by Lender, including
Lender’s attorney’s fees and expenses, incurred in connection therewith.

 

III.                                 REPRESENTATIONS AND WARRANTIES

 

Section 3.1            Borrower Representations.  Borrower represents and warrants as of the date hereof,
except as described on Schedule 3.1 attached hereto, that:

 

3.1.1            Organization.  (a) Each
of Borrower and each SPC Party is duly organized, validly existing and in good
standing with full power and authority to own its assets and conduct its
business, and is duly qualified in all jurisdictions in which the ownership or
lease of its property or the conduct of its business requires such
qualification, except where the failure to be so qualified would not have a
material adverse effect on its ability to perform its obligations hereunder,
and Borrower has taken all necessary action to authorize the execution,
delivery and performance of this Agreement and the other Loan Documents by it,
and has the power and authority to execute, deliver and perform under this
Agreement, the other Loan Documents and all the transactions contemplated
hereby.

 

(b)           Borrower’s exact
legal name is correctly set forth in the first paragraph of this Agreement.  Borrower is an organization of the type
specified in the first paragraph of this Agreement.  Borrower is incorporated or organized under
the laws of the state specified in the first paragraph of this Agreement.  Borrower’s principal place of business and
chief executive office, and the place where Borrower keeps its books and
records, including recorded data of any kind or nature, regardless of the
medium of recording, including software, writings, plans, specifications and
schematics will be the address of Borrower set forth in the first paragraph of
this Agreement (unless Borrower notifies Lender in writing at least thirty (30)
days prior to the date of such change). 
Propco Borrower’s organizational identification number, if any, assigned
by the state of its incorporation or organization is 4254295.  Propco Borrower’s federal tax identification
number is 20-5880999.  Opco Borrower’s
organizational identification number, if any, assigned by the state of its
incorporation or organization is 4254296. 
Opco Borrower’s 

 

36

 

federal tax
identification number is 20-5880830. 
Borrower is not subject to back-up withholding taxes.

 

3.1.2            Proceedings.  This Agreement and the other Loan Documents have been duly
authorized, executed and delivered by Borrower and constitute a legal, valid
and binding obligation of Borrower, enforceable against Borrower in accordance
with their respective terms, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the enforcement of creditors’ rights generally, and by general
principles of equity (regardless of whether such enforceability is considered
in a proceeding in equity or at law).

 

3.1.3            No Conflicts.  The execution and delivery of this Agreement and the
other Loan Documents by Borrower and the performance of its obligations
hereunder and thereunder will not conflict with any provision of any law or
regulation to which Borrower is subject, or conflict with, result in a breach
of, or constitute a default under, any of the terms, conditions or provisions
of any of Borrower’s organizational documents or any agreement or instrument to
which Borrower is a party or by which it is bound, or any order or decree applicable
to Borrower, or result in the creation or imposition of any lien on any of
Borrower’s assets or property (other than pursuant to the Loan Documents).

 

3.1.4            Litigation.  There is no action, suit, proceeding or investigation
pending or, to Borrower’s knowledge, threatened against Borrower in any court
or by or before any other Governmental Authority which would materially and
adversely affect the ability of Borrower to carry out the transactions
contemplated by this Agreement.

 

3.1.5            Orders and Decrees.  Borrower is not in default with respect to any order or
decree of any court or any order, regulation or demand of any Governmental
Authority, which default might have consequences that would materially and
adversely affect the condition (financial or other) or operations of Borrower
or its properties or might have consequences that would adversely affect its
performance hereunder.

 

3.1.6            Consents.  No consent, approval, authorization or order of any
court or Governmental Authority is required for the execution, delivery and
performance by Borrower of, or compliance by Borrower with, this Agreement or
the consummation of the transactions contemplated hereby, other than those
which have been obtained by Borrower.

 

3.1.7            Title.  (a) Borrower has good, marketable and insurable fee simple
title to the real property
comprising part of each Individual Property and good title to the balance of
each Individual Property owned by it, free and clear of all Liens whatsoever
except the Permitted Encumbrances.  The Mortgage,
when properly recorded in the appropriate records, together with any Uniform
Commercial Code financing statements required to be filed in connection
therewith, will create (i) a valid, first priority, perfected lien on the
Property, subject only to Permitted Encumbrances and (ii) perfected
security interests in and to, and perfected collateral assignments of, all
personalty comprising the Property (including the Leases), all in accordance
with the terms thereof, in each case subject only to any Permitted
Encumbrances.  Except as indicated on the
Title Insurance Policy for each Individual Property if insured over by the
title company issuing the Title Insurance Policy for each Individual Property
or those that are 

 

37

 

contested in
accordance with the terms of this Agreement, there are no mechanics’,
materialman’s or other similar liens or claims which have been filed for work,
labor or materials affecting the Property which are or may be liens prior to,
or equal or coordinate with, the lien of the Mortgage.  To Borrower’s knowledge, none of the
Permitted Encumbrances, individually or in the aggregate, materially interfere
with the benefits of the security intended to be provided by the Mortgage and
this Loan Agreement, materially and adversely affect the value of the Property
in light of the manner in which the same is currently being used, impair the
use or operations of the Property or impair Borrower’s ability to pay its
obligations in a timely manner.

 

(b)           The Security
Agreement, together with any Uniform Commercial Code financing statements
required to be filed in connection therewith, will create a valid perfected
lien and security interest in, and a perfected collateral assignment of, all
personalty of Opco Borrower, all in accordance with the terms thereof, subject
only to any Permitted Encumbrances.

 

3.1.8            No Plan Assets.  As of the date hereof and throughout the term of the
Loan (a) Borrower is not and will not be an “employee benefit plan,” as defined
in Section 3(3) of the Employee Retirement Income Security Act of
1974, as amended (“ERISA”), whether or not subject to Title I of ERISA,
or a “plan” as defined in Section 4975 of the Code, (b) none of the
assets of Borrower constitutes or will constitute “plan assets” of one or more
such plans within the meaning of U.S. Department of Labor Regulation 29 C.F.R. Section 2510.3101
(the “Plan Assets Regulation”)
and (c) transactions by or with Borrower are not and will not be
prohibited transactions under ERISA.

 

3.1.9            Compliance.  Borrower and each Individual Property and the use thereof
comply in all material respects with all applicable Legal Requirements,
including, without limitation, building and zoning ordinances and codes and
Prescribed Laws.  To Borrower’s
knowledge, Borrower is not in default or violation of any order, writ,
injunction, decree or demand of any Governmental Authority, the violation of
which would materially adversely affect the condition (financial or otherwise)
or business of Borrower.  To Borrower’s
knowledge, Borrower has not committed any act which may give any Governmental
Authority the right to cause Borrower to forfeit the Property or any part
thereof or any monies paid in performance of Borrower’s obligations under any
of the Loan Documents. With respect to those Individual Properties listed on Schedule
IX, Borrower hereby represents that no certificate of occupancy is
available or required in order for each such Individual Property to be in
compliance with local zoning rules and regulations in the jurisdiction
where each such Individual Property is located.

 

3.1.10         Financial Information.  All financial data taken as a whole, including, without
limitation, the statements of cash flow and income and operating expense, that
have been delivered to Lender in respect of the Property (other than financial
forecasts) fairly present in all material respects the financial condition of
the Property as of the date of such reports; the financial forecasts delivered
to Lender were prepared in good faith by Borrower for its own use in the
ordinary course of business.  Borrower
does not have any contingent liabilities other than its liabilities under the
Loan Documents, liabilities for taxes,
unusual forward or long-term commitments or unrealized or anticipated losses
from any unfavorable commitments that are known to Borrower and reasonably
likely to have a materially adverse effect on the Property or the operation
thereof, except as referred to or reflected in said financial statements. Since
the 

 

38

 

date of the
financial statements, there has been no material adverse change in the
financial condition, operations or business of Borrower or the Property from
that set forth in said financial statements.

 

3.1.11         Condemnation.  No Condemnation or other proceeding has been commenced
or, to Borrower’s best knowledge, is contemplated with respect to all or any
portion of the Property or for the relocation of roadways providing access to
the Property.

 

3.1.12         Utilities and Public
Access.  Each Individual Property has rights of access
to public ways and is served by water, sewer, sanitary sewer and storm drain
facilities adequate to service such Individual Property for its intended uses.  All roads necessary for the current
utilization of the Property for its current purpose have been dedicated to
public use and accepted by all governmental authorities or are the subject of
access easements for the benefit of the Property.

 

3.1.13         Separate Lots.  Each Individual Property is comprised of one (1) or
more parcels which constitute separate tax lots and do not constitute a portion
of any other tax lot not a part of the Property.

 

3.1.14         Assessments.  To Borrower’s knowledge, there are no pending or
proposed special or other assessments for public improvements or otherwise
affecting any Individual Property, nor are there any contemplated improvements
to any Individual Property that may result in such special or other assessments
which, in any such case, would have a material adverse effect on Borrower’s
ability to perform its obligations under the Loan Documents.

 

3.1.15         Enforceability.  The Loan Documents are not subject to any right of
rescission, set-off, counterclaim or defense by Borrower, including the defense
of usury, nor would the operation of any of the terms of the Loan Documents, or
the exercise of any right thereunder, render the Loan Documents unenforceable,
and Borrower has not asserted any right of rescission, set-off, counterclaim or
defense with respect thereto.

 

3.1.16         Assignment of Leases.  The Assignment of Leases creates a valid assignment of,
or a valid security interest in, certain rights under the Leases, subject only
to a license granted to Borrower to exercise certain rights and to perform
certain obligations of the lessor under the Leases, including the right to
operate the Property.  No Person other
than Lender or Borrower has any interest in or assignment of the Leases or any
portion of the Rents due and payable or to become due and payable thereunder.

 

3.1.17         Insurance.  Borrower has obtained and has delivered to Lender acceptable
evidence of the existence of all of the Policies, with all premiums due and
payable prepaid thereunder, reflecting the insurance coverages, amounts and
other requirements set forth in this Agreement. 
No Person, including Borrower, has done, by act or omission, anything
which would impair the coverage of any of the Policies.

 

3.1.18         Licenses.  All permits and approvals, including without limitation,
certificates of occupancy required by any Governmental Authority for the use,
occupancy and operation of the Property in the manner in which the Property is
currently being used, occupied 

 

39

 

and operated have
been obtained and are in full force and effect except for such permits and
approvals the absence of which would not result in a material adverse effect on
the financial condition of Borrower or the Individual Property for which
Borrower failed to obtain such permit or approval.

 

3.1.19         Flood Zone.  Except as shown on the Survey, none of the Improvements on
any Individual Property are located in an area identified by the Federal
Emergency Management Agency as a special flood hazard area.

 

3.1.20         Physical Condition.  To Borrower’s knowledge and except as set forth in the
applicable Physical Conditions Report, each Individual Property, including,
without limitation, all buildings, improvements, parking facilities, sidewalks,
storm drainage systems, roofs, plumbing systems, HVAC systems, fire protection
systems, electrical systems, equipment, elevators, exterior sidings and doors,
landscaping, irrigation systems and all structural components, are in good
condition, order and repair in all material respects; there exists no
structural or other material defects or damages in any Individual Property,
whether latent or otherwise, and Borrower has not received notice from any
insurance company or bonding company of any defects or inadequacies in any
Individual Property, or any part thereof, which would adversely affect the
insurability of the same or cause the imposition of extraordinary premiums or
charges thereon or of any termination or threatened termination of any policy
of insurance or bond.

 

3.1.21         Boundaries.  Except as shown on the Survey, all of the improvements which
were included in determining the appraised value of the Property lie wholly
within the boundaries and building restriction lines of each Individual
Property, and no improvements on adjoining properties encroach upon any
Individual Property, and no easements or other encumbrances affecting any
Individual Property encroach upon any of the improvements, so as to affect the
value or marketability of any Individual Property except those which are
insured against by title insurance.

 

3.1.22         Leases.  Borrower represents and warrants to Lender with respect to
the Leases that: (a) the “Major Customer List” attached hereto as Schedule
I is true, complete and correct in all material respects, (b) the
Leases identified on Schedule I are in full force and effect and there
are no material defaults thereunder by either party, (c) Borrower has
delivered to Lender copies of all Leases with terms in excess of one (1) year
or which generate revenue in excess of Five Hundred Thousand and No/100 Dollars
($500,000.00) annually, (d) there are no Leases which contain rights or
options of the Tenant thereunder to purchase all or any part of the Property or
require the Borrower to purchase any of the Improvements other than as set forth
on Schedule I, (e) the copies of the Leases delivered to Lender are
true and complete, and there are no oral agreements with respect thereto, (f) no
Rent (including security deposits) has been paid more than one (1) month
in advance of its due date, (g) all alterations or improvements at each
Individual Property to be performed by Borrower under each Lease has been
performed as required and has been accepted by the applicable Tenant, (h) any
payments, free rent, partial rent, rebate of rent or other payments, credits,
allowances or abatements required to be
given by Borrower to any Tenant has already been received by such Tenant
and (i) all security deposits are being held in accordance with Legal
Requirements.

 

40

 

3.1.23         Filing and Recording
Taxes.  All transfer taxes, deed stamps, intangible
taxes or other amounts in the nature of transfer taxes required to be paid
under applicable Legal Requirements in connection with the transfer of the
Property to Borrower have been paid or are being submitted for payment
simultaneously herewith.  All mortgage,
mortgage recording, stamp, intangible or other similar tax required to be paid
under applicable Legal Requirements in connection with the execution, delivery,
recordation, filing, registration, perfection or enforcement of any of the Loan
Documents, including, without limitation, the Mortgage, have been paid or are
being submitted for payment simultaneously herewith.  All taxes and governmental assessments due
and owing in respect of the Property have been paid, or an escrow of funds in
an amount sufficient to cover such payments has been established hereunder or
are insured against by the title insurance policy to be issued in connection
with the Mortgage.

 

3.1.24         Single Purpose.  Borrower hereby represents and warrants to, and covenants
with, Lender that as of the date hereof and until such time as the Debt shall
be paid in full:

 

(a)           (1) Propco
Borrower does not own and will not own any asset or property other than (i) the
Property, and (ii) incidental personal property necessary for the
ownership or operation of the Property and (2) Opco Borrower does not own
and will not own any asset or property other than the personalty and other
assets owned by it necessary for the operation of the Property.

 

(b)           (1) Propco Borrower will not engage in any business other than the ownership,
management and operation of the Property and (2) Opco Borrower will not
engage in any business other than the management and operation of the Property,
and each Borrower will conduct and operate its business as presently conducted
and operated.

 

(c)           Borrower will not
enter into any contract or agreement with any Affiliate of Borrower, any
constituent party of Borrower or any Affiliate of any constituent party, except
upon terms and conditions that are commercially reasonable (taking into account
all facts and circumstances) and either substantially similar to those that
would be available on an arm’s-length basis with third parties other than any
such party or a capital contribution or distribution.

 

(d)           Borrower has not
incurred and will not incur any Indebtedness other than (i) the Debt, (ii) unsecured
trade payables and operational debt not evidenced by a note and (iii) Indebtedness
incurred in the financing of equipment and other personal property used on the
Property; provided that any Indebtedness incurred pursuant to subclauses
(ii) and (iii) shall be (x) not
in excess of 5% of the outstanding principal amount of
the Loan in the aggregate, (y) paid not more than sixty (60) days from the
date incurred as to the matters in subclause (ii) above and not more than
sixty (60) days from the date due as to the matters in subclause (iii) above
and (z) incurred in the ordinary course of business.  No Indebtedness other than the Debt may be
secured (subordinate or pari passu) by the Property other than Indebtedness
of the type described in and subject to the requirements of clause (iii) of
this clause (d).

 

(e)           Except as expressly
contemplated by the Loan Documents with respect to the other Borrower, Borrower
has not made and will not make any loans or advances to any third 

 

41

 

party (including
any Affiliate or constituent party), and shall not acquire obligations or
securities of any of its Affiliates.

 

(f)            Borrower is and
will remain solvent and Borrower will pay all of its debts and liabilities
(including, as applicable, a fairly allocated portion of shared personnel and
overhead expenses) only from its own assets and as the same shall become due.

 

(g)           Borrower has done or
caused to be done and will do all things necessary to observe organizational
formalities applicable to Borrower and preserve Borrower’s existence, and
Borrower will not, nor will Borrower permit any constituent party to amend,
modify or otherwise change the partnership certificate, partnership agreement,
articles of incorporation and bylaws, operating agreement, trust or other
organizational documents of Borrower without the prior consent of Lender in any
manner that (i) violates or makes such organizational documents
inconsistent with the single purpose covenants set forth in this Section 3.1.24,
or (ii) amends, modifies or otherwise changes any provision thereof that
by its terms cannot be modified
at any time when the Loan is outstanding or by its terms cannot be modified
without Lender’s consent.

 

(h)           Borrower will
maintain all of its books, records, financial statements (it being acknowledged
that the agent under the Cash Management Agency Agreement shall be continuously
able to produce separate balance sheets of the Borrowers) and (except as
contemplated in the Cash Management Agency Agreement) hank accounts separate
from those of its Affiliates and from those of any other Person.  Borrower’s assets will not be listed as
assets on the financial statement of any other Person, provided, however,
that Borrower’s assets may be included in a consolidated financial statement of
its Affiliates provided that (i) appropriate notation shall be made
on such consolidated financial statements (and/or in Annual Reports on Form 10-K
filed with U.S. Securities and Exchange Commission in which such financial
statements are contained) to indicate the separateness of Borrower and such
Affiliates and to indicate that Borrower’s assets and credit are not available
to satisfy the debts and other obligations of such Affiliates or any other
Person and (ii) such assets are continuously able to be listed on Borrower’s
own separate balance sheet.  Borrower
will file its own tax returns (to the extent Borrower is required to file tax
returns).  Borrower shall maintain its
hooks, records, resolutions and agreements as official records.

 

(i)            Borrower will be,
and at all times will hold itself out to the public as, a legal entity separate
and distinct from any other entity (including any Affiliate of Borrower or any
constituent party of Borrower), shall correct any known misunderstanding
regarding its status as a separate entity, shall conduct business in its own
name, shall not identify itself or any of its Affiliates as a division or part
of the other and shall maintain and utilize separate stationery, invoices and
checks bearing its own name (except with respect to payments or communications
made on behalf of the Borrower by the counterparty to the Cash Management
Agency Agreement, in which event, such counterparty shall nevertheless identify
the Borrower as the party on whose behalf the payment or communication is being
made).

 

(j)            Borrower will
maintain adequate capital for the normal obligations reasonably foreseeable in
a business of its size and character and in light of its contemplated business
operations.

 

42

 

(k)           Neither Borrower nor
any constituent party will seek or effect the liquidation, dissolution, winding
up, consolidation or merger, in whole
or in part, of Borrower.

 

(l)            Except as expressly
contemplated by the Loan Documents and the Cash Management Agency Agreement,
Borrower will not commingle the funds or other assets of Borrower with those of
any Affiliate or constituent party or any other Person, and will hold all of
its assets in its own name.

 

(m)          Borrower has and will
maintain its assets in such a manner that it will not be costly or difficult to
segregate, ascertain or identify its individual assets from those of any
Affiliate or constituent party or any other Person.

 

(n)           Except as expressly
contemplated by the Loan Documents with respect to the other Borrower, Borrower
will not guarantee or become obligated for the debts of any other Person and
does not and will not hold itself out to be responsible for or have its credit
available to satisfy or hold out its credit as being available to satisfy the
debts or obligations of any other Person.

 

(o)           (i)  If Borrower is a limited
partnership or a limited liability company, (other than a single member limited
liability company that satisfies all of the requirements of Section 3.1.24(o)(ii)),
each general partner or managing member (each, an “SPC Party”) of Borrower
shall be a corporation or single
member limited liability company that satisfies all of the requirements of Section 3.1.24(o)(ii) whose
sole asset is a direct interest in Borrower of at least 0.5% (or 0.1% if Borrower is an entity formed under the
laws of Delaware) and each such SPC Party will at all times comply with each of the representations, warranties, and
covenants contained in this Section 3.1.24 as if such
representation, warranty or covenant was made directly by such SPC Party
(substituting the term “SPC Party” for the term Borrower” throughout) and will
cause Borrower to comply with this Section 3.1.24 (except for
subsections (a), (b), (d), (n) and (x)). 
Upon the withdrawal or the disassociation of an SPC Party from Borrower,
Borrower shall immediately appoint a new SPC Party whose constituent documents
are substantially similar to those of the withdrawing or disassociating SPC
Party and deliver a new non-consolidation opinion to
the Rating Agency or
Rating Agencies, as applicable, with respect to the new SPC Party and its
equity owners.  If Borrower is a limited partnership,
Borrower shall have at least one
general partner.  If Borrower is a
limited liability company (other than a single-member limited liability company
that satisfies all of the requirements of Section 3.1.24(o)(ii)),
Borrower shall have at least one (1) managing member. An SPC Party shall
be organized for the sole purpose of owning a direct interest in the Borrower,
shall own no other interests in any entity, and shall not incur indebtedness
except as it may be liable for
the debts of the Borrower in its capacity as general partner of the Borrower.

 

(ii)           if Borrower is a single member
limited liability company (“single member limited liability company”
meaning a limited liability company having only one equity member), Borrower
shall be a limited liability company organized under the laws of Delaware and
shall have either (A) two (2) non-equity members or (B) at least two springing
members, one of which, upon the dissolution of such sole member or the 

 

43

 

withdrawal or the disassociation of the sole member
from Borrower, shall immediately become the sole member of Borrower, and the
other of which shall become the sole member of Borrower if the first such
springing member no longer is available to serve as such sole member.

 

(p)           Borrower or its SPC Party shall at all times cause
there to be at least two duly appointed Independent Directors, who are provided
by a nationally recognized company that provides professional independent
directors, of each SPC Party and of Borrower if Borrower is a single member
limited liability company.  As used
herein, “Independent Director” shall mean a natural person serving as a
director of a corporation or manager of a limited liability company who is not
at the time of initial appointment, or at any time while serving, and has not
been at any time during the preceding five (5) years: (a) a stockholder or director
(with the exception of serving as the Independent Director of Borrower or any
SPC Party that is an SPC Party or managing member of Borrower), trustee,
officer, employee, partner, member, attorney or counsel of SPC Party, Borrower
or any affiliate of either of them; (b) a creditor, customer, supplier or
other person who derives any of its purchases or revenues from its activities
with SPC Party, Borrower or any affiliate of either of them; (c) a person
or other entity controlling or under common control with any Person excluded
from serving as Independent Director under subparagraph (a) or (b); or (d) a
member of the immediate family of any Person excluded from serving as
Independent Director under subparagraph (a) or (b).  As used in this definition, the term “affiliate”
means any person controlling, under common control with, or controlled by the
person in question; and the term “control” means the possession, directly or
indirectly, of the power to direct or cause the direction of management,
policies or activities of a person or entity, whether through ownership of
voting securities, by contract or otherwise. 
A natural person who satisfies the foregoing definition other than subparagraph (b) shall not
be disqualified from serving as an Independent Director if such individual has
been provided by a nationally-recognized company that provides professional
independent directors.  A natural person
who otherwise satisfies the foregoing definition except for being the
Independent Director of a “special purpose entity” affiliated with Borrower or
SPC Party shall not be disqualified from serving as an Independent Director of
Borrower or SPC Party if such “special purpose entity” does not own a direct or
indirect equity interest in Borrower or in any co-borrower of Borrower and if
such individual is an independent director provided by a nationally-recognized
company that provides professional independent directors. For purposes of this
paragraph, a “special purpose entity” is an entity, whose organizational
documents contain restrictions on its activities substantially similar to those
set forth in Section 3.1.24 of this Agreement.

 

(q)           Borrower shall not
cause or permit the board of directors, trustees or managers of any SPC Party
or of Borrower to take any action which, under the terms of any certificate of
incorporation, bylaws or any voting trust agreement with respect to any common
stock or under any organizational document of Borrower or SPC Party, requires
the vote or consent of such Independent Directors unless at the time of such
action there shall be at least two Independent Directors then serving in such
capacity who have provide the required vote or consent.

 

(r)            Borrower shall
conduct its business so that the assumptions made with respect to Borrower in
the Insolvency Opinion shall be true and correct in all respects.  In connection with the foregoing, Borrower
hereby covenants and agrees that it will comply with or 

 

44

 

cause the
compliance with, (i) all of the facts and assumptions (whether regarding
the Borrower or any other Person) set forth in the Insolvency Opinion, (ii) all
the representations, warranties and covenants in this Section 3.1.24.
and (iii) all the organizational documents of the Borrower and any SPC
Party.

 

(s)           Borrower will not
permit any Affiliate or constituent party independent access to its bank
accounts (subject to the requirements hereof, and except with respect to the
agency relationships contemplated by the Cash Management Agency Agreement and
the Cash Management Agreement).

 

(t)            Borrower will pay
the salaries of its own employees (if any) from its own funds and maintain a
sufficient number of employees in light of its contemplated business
operations; provided, however, that zero employees may be
sufficient for such operations given the services provided to Borrower by other
entities and that Borrower may lease employees on a full or part-time basis
pursuant to arms-length terms.

 

(u)           Borrower will
compensate each of its consultants and agents from its funds for services provided
to it and pay from its own assets all obligations of any kind that it incurs.

 

(v)           Borrower will not
buy or hold indebtedness issued by any other Person (other than cash and
investment grade securities).

 

(w)          Except as expressly
contemplated by the Loan Documents with respect to the other Borrower, Borrower
will not pledge its assets to secure the obligations of any other Person.

 

(x)            Borrower will not
form, acquire or hold any subsidiary or own any equity interest in any other
entity.

 

(y)           Borrower will not
engage in any Bankruptcy Action without the written consent of two Independent
Directors of Borrower or SPC Party.  As
used herein, “Bankruptcy Action” shall mean, with respect
to any Person, to
institute proceedings to have such Person be adjudicated bankrupt or insolvent,
or consent to the institution of bankruptcy or insolvency proceedings against
such Person or file a petition seeking, or consent to, reorganization or relief
with respect to such Person under any applicable federal or state law relating
to bankruptcy or insolvency, or consent to the appointment of a receiver,
liquidator, assignee, trustee, sequestrator (or other similar official) of such
Person or a substantial part of its property, or make any assignment for the
benefit of creditors of such Person, or admit in writing such Person’s
inability to pay its debts generally as they become due, or take action in
furtherance of any such action.

 

(z)            Neither (a) ART
Mortgage Borrower Propco GP 2006-1A LLC, a Delaware limited liability company
(the “Propco Borrower GP”), the general partner of Propco Borrower, nor (b) ART
Mortgage Borrower Opco GP 2006-1A LLC, a Delaware limited liability company
(the “Opco Borrower GP”, and together with PropCo Borrower GP,
individually or collectively, as the context may require, “Borrower GP”),
the general partner of Opco Borrower, will own any asset or property other than
(A) its respective general
partnership interest in Propco Borrower or Opco Borrower, as the case may be,
and (B) incidental personal property necessary 

 

45

 

for the ownership
of such interest or operation of Propco Borrower or Opco Borrower, as
applicable.

 

(aa)         Neither Borrower GP
will engage in any business other than being and acting as general partner of
Propco Borrower or Opco Borrower, as the case may be, and will conduct and
operate its business as presently conducted.

 

(bb)         Neither Borrower GP
has incurred or will incur any Indebtedness except as it may be liable for the
debts of Propco Borrower or Opco Borrower, as the case may be, in its capacity
as general partner of the Propco Borrower or Opco Borrower, as the case may be.

 

(cc)         Except as it is
liable in its capacity as general partner of Propco Borrower or Opco Borrower,
as the case may be, neither Borrower GP will guarantee or become obligated for
the debts of any other Person and does not and will not hold itself out to be
responsible for or have its credit available to satisfy or hold its credit as
being available to satisfy the debts or obligations of any other Person.

 

(dd)         Neither Borrower GP
will form, acquire or hold any subsidiary or own any equity interest in any
other entity other than Propco Borrower or Opco Borrower, as the case maybe.

 

3.1.25         Tax Filings.  To the extent required, Borrower timely has filed (or
has obtained effective extensions for filing) all federal, state and local tax
returns required to be filed and has paid or made adequate provision for the
payment of all federal, state and local taxes, charges and assessments payable
by Borrower.

 

3.1.26         Solvency.  Borrower (a) has not entered into the transaction or
any Loan Document with the actual intent to hinder, delay, or defraud any
creditor and (b) has received reasonably equivalent value in exchange for
its obligations under the Loan Documents. Giving effect to the Loan, the fair
saleable value of Borrower’s assets exceeds and will, immediately following the
making of the Loan, exceed Borrower’s total liabilities, including, without
limitation, subordinated, unliquidated, disputed and contingent
liabilities.  The fair saleable value of
Borrower’s assets is and will, immediately following the making of the Loan, be
greater than Borrower’s probable liabilities, including the maximum amount of
its contingent liabilities on its debts as such debts become absolute and
matured.  Borrower’s assets do not and,
immediately following the making of the Loan will not, constitute unreasonably
small capital to carry out its business as conducted or as proposed to be conducted.  Borrower does not intend to, and does not
believe that it will, incur Indebtedness and liabilities (including contingent
liabilities and other commitments) beyond its ability to pay such Indebtedness
and liabilities as they mature (taking into account the timing and amounts of
cash to be received by Borrower and the amounts to be payable on or in respect
of obligations of Borrower).

 

3.1.27         Federal Reserve
Regulations.  No part of the proceeds of the Loan will be
used by Borrower for the purpose of purchasing or acquiring any “margin stock”
within the meaning of Regulation U of the Board of Governors of the Federal
Reserve System or for any other purpose which would be inconsistent with such
Regulation U or any other Regulations of 

 

46

 

such Board of
Governors, or for any purposes prohibited by Legal Requirements or by the terms
and conditions of this Agreement or the other Loan Documents.

 

3.1.28         Organizational Chart.  The organizational chart attached as Schedule III
hereto, relating to Borrower and certain Affiliates and other parties, is true,
complete and correct on and as of the date hereof.

 

3.1.29         Bank Holding Company.  Borrower is not a “bank holding company” or a direct or
indirect subsidiary of a “bank holding company” as defined in the Bank Holding
Company Act of 1956, as amended, and Regulation Y thereunder
of the Board of Governors of the Federal Reserve System.

 

3.1.30         No Other Debt.  Borrower has not borrowed or received debt financing (other
than permitted pursuant to this Agreement) that has not been heretofore repaid
in full.

 

3.1.31         Investment Company Act.  Borrower is not (1) an “investment company” or a
company “controlled” by an “investment company,” within the meaning of the
Investment Company Act of 1940, as amended or (2) subject to any other
federal or state law or regulation which purports to restrict or regulate its
ability to borrow money.

 

3.1.32         Intentionally
Omitted.

 

3.1.33         No Bankruptcy Filing.  Borrower is not contemplating either the filing of a
petition by it under any state or federal bankruptcy or insolvency laws or the
liquidation of its assets or property, and Borrower does not have any knowledge
of any Person contemplating the filing of any such petition against it.

 

3.1.34         Full and Accurate
Disclosure.  To the best of Borrower’s knowledge, no
information contained in this Agreement, the other Loan Documents, or any
written statement furnished by or on behalf of Borrower pursuant to the terms
of this Agreement, when considered together, contains any untrue statement of a
material fact or omits to state a material fact necessary to make the
statements contained herein or therein not misleading in light of the
circumstances under which they were made. 
There is no fact or circumstance presently known to Borrower which has
not been disclosed to Lender and which materially adversely affects, or is
reasonably likely to materially adversely affect, the Property, Borrower or its
business, operations or condition (financial or otherwise).

 

3.1.35         Foreign Person.  Borrower is not a “foreign person” within the meaning of Section 1445(f)(3) of
the Code.

 

3.1.36         Intentionally
Omitted.

 

3.1.37         No Change in Facts or
Circumstances; Disclosure.  To Borrower’s knowledge, there has been no material
adverse change in any condition, fact, circumstance or event that would make
the financial statements, reports, certificates or other documents submitted in
connection with the Loan inaccurate, incomplete or otherwise misleading in any
material respect or that otherwise materially and adversely affects the
business operations or the financial condition of Borrower or the Property.

 

47

 

3.1.38         Property Management.  (a)  Each agreement comprising the Cash Management Agency
Agreement is in full force and effect
and there is no default by any party thereto and no event has occurred that,
with the passage of time and/or the giving of notice, would constitute a
default thereunder.

 

(b)           The Management Agreement
is in full force and effect and there is no default by any party thereto and no event has occurred that, with the
passage of time and/or the giving of notice, would constitute a default
thereunder.

 

3.1.39         Perfection of Accounts.  Borrower hereby represents and warrants to Lender that:

 

(a)           This Agreement,
together with the other Loan Documents, create a valid and continuing security
interest (as defined in the Uniform Commercial Code) in the Accounts in favor
of Lender, which security interest is prior to all other Liens, other than
Permitted Encumbrances, and is enforceable as such against creditors of and
purchasers from Borrower.  Other than in
connection with the Loan Documents and except for Permitted Encumbrances,
Borrower has not sold or otherwise conveyed the Accounts;

 

(b)           The Accounts
constitute “deposit accounts” or “securities accounts” within the meaning of
the Uniform Commercial Code, as set forth in the Cash Management Agreement;

 

(c)           Pursuant and subject
to the terms hereof, Agent has agreed to comply with all instructions
originated by Lender, without further consent by Borrower, directing
disposition of the Accounts and all sums at any time held, deposited or
invested therein, together with any interest or other earnings thereon, and all
proceeds thereof (including proceeds of sales and other dispositions), whether
accounts, general intangibles, chattel paper, deposit accounts, instruments,
documents or securities; and

 

(d)           The Accounts are not
in the name of any Person other than Borrower, as pledgor, or Lender, as
pledgee.  Borrower has not consented to
Agent’s complying with instructions with respect to the Accounts from any
Person other than Lender.

 

3.1.40         Agreements.  Borrower is not in default in any material respect in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in any agreement or instrument to which it is a party or
by which Borrower or the Property is bound which default is reasonably likely
to materially and adversely effect Borrower or its business, properties or
assets, operations or financial condition, financial or otherwise.

 

3.1.41         Intentionally
Omitted.

 

3.1.42         SPE Separateness
Covenants.  Borrower hereby represents that it has complied
with the separateness covenants contained in its organizational documents since its formation and in place
from time to time.

 

Section 3.2            Survival of
Representations.  The representations and warranties set forth
in Section 3.1 shall survive (but shall be deemed made only as of
the date hereof), and 

 

48

 

any covenants
contained in Section 3.1 shall continue, for so long as any amount
remains payable to Lender under this Agreement or any of the other Loan
Documents.

 

IV.                                BORROWER COVENANTS

 

Section 4.1            Borrower
Affirmative Covenants.  Borrower hereby covenants and
agrees with Lender that:

 

4.1.1            Existence; Compliance
with Legal Requirements.  Borrower shall do or cause to be done all things necessary
to preserve, renew and keep in full force and effect its existence, rights,
licenses, permits and franchises and comply in all material respects with all
Legal Requirements applicable to it and the Property, including, without
limitation, Prescribed Laws.

 

4.1.2            Taxes and Other Charges.  Borrower shall pay all Taxes and Other Charges now or
hereafter levied or assessed or imposed against the Property or any part
thereof as the same become due and payable;
provided, however, Borrower’s obligation
to directly pay Taxes shall, during the continuance of a Trigger Period, be
suspended for so long as Borrower complies with the terms and provisions of Section 6.2
hereof.  Borrower shall furnish to Lender
receipts for the payment of the Taxes and the Other Charges prior to the date
the same shall become delinquent; provided, however, that
Borrower is not required to furnish such receipts for payment of Taxes in the
event that such Taxes have been paid by Lender pursuant to Section 6.2
hereof.  Borrower shall not permit or
suffer and shall promptly discharge any lien or charge against the Property
(but subject to the foregoing provisions of this Section 4.1.2).  After prior notice to Lender (unless
subclause (v)(y) of this Section 4.1.2 is applicable),
Borrower, at its own expense, may contest by appropriate legal proceeding,
conducted in good faith and with due diligence, the amount or validity of any
Taxes or Other Charges, provided that (i) no Event of Default has
occurred and remains uncured; (ii) such proceeding shall be permitted
under and be conducted in accordance with all applicable statutes, laws and
ordinances; (iii) neither the Property nor any part thereof or interest
therein will be in danger of being sold, forfeited, terminated, canceled or
lost during the pendency of such contest; (iv) unless subclause (v)(y) of
this Section 4.1.2 is applicable, Borrower shall promptly upon
final determination thereof pay the amount of any such Taxes or Other Charges,
together with all costs, interest and penalties which may be payable in
connection therewith; (v) either (x) such proceeding shall suspend
the collection of Taxes or Other Charges from the Property or (y) Borrower
shall have paid or discharged by bond or otherwise all of the Taxes or Other
Charges under protest; and (vi) unless subclause (v)(y) of this Section 4.1.2
is applicable, Borrower shall have furnished such security (if any) as may be
required in the proceeding, or as may be reasonably requested by Lender to
insure the payment of any contested Taxes or Other Charges, together with all
interest and penalties thereon.  Lender
may pay over any such cash or other security held by Lender to
the claimant entitled thereto at any time when, in the judgment of Lender, the
entitlement of such claimant is established.

 

4.1.3            Litigation.  Borrower shall give prompt notice to Lender of any
litigation or governmental proceedings pending or threatened against Borrower
which is not covered by insurance and could reasonably be expected to
materially adversely affect the 

 

49

 

Property or
Borrower’s ability to perform its obligations hereunder or under the other Loan
Documents.

 

4.1.4            Access to Property.  Borrower shall permit agents, representatives and employees
of Lender, at Lender’s sole cost and expense (unless an Event of Default shall
have occurred and be continuing, in which case such inspection
shall be at Borrower’s sole cost and expense), to inspect the Property or any
part thereof at reasonable hours upon reasonable advance notice subject to the
terms of the Leases, and provided such entry and inspection shall not
unreasonably interfere with the usual operation and conduct of business at the
Property or the use and enjoyment of
the Property by
Borrower or its tenants, customers and guests.

 

4.1.5            Further Assurances;
Supplemental Mortgage Affidavits.  Borrower
shall, at Borrower’s sole cost and expense:

 

(a)           execute and deliver
to Lender such documents, instruments, certificates, assignments and other
writings, and do such other acts necessary or desirable, to evidence, preserve
and/or protect the collateral at any time securing or intended to secure the
obligations of Borrower under the Loan Documents, as Lender may reasonably
require; and

 

(b)           do and execute all
and such further lawful and reasonable acts, conveyances and assurances for the
better and more effective carrying out of the intents and purposes of this
Agreement and the other Loan Documents, as Lender shall reasonably require from
time to time.

 

4.1.6            Financial Reporting.  (a) Borrower
shall keep and maintain or will cause to be kept and maintained proper and
accurate books and records, in accordance with GAAP, reflecting the financial
affairs of Borrower.  Lender shall have
the right from time to time during normal business hours upon reasonable notice
to Borrower to examine such books and records at the office of Borrower or other Person maintaining such books
and records and to make such copies or extracts thereof as Lender shall desire.

 

(b)           Borrower shall
furnish Lender annually, within one hundred twenty (120) days following the end
of each Fiscal Year, a complete copy of Guarantor’s annual financial statements
audited by a “Big Four” accounting firm or other independent certified public
accountant acceptable to Lender prepared in accordance with GAAP, which audited
financial statements shall include a balance sheet for Guarantor and shall be
supplemented by schedules covering the Property which include statements of
income and expense for the Property and the so-called “key performance
indicators” utilized by Borrower (which shall be prepared in a manner
consistent with Borrower’s then-current practices). Such schedules shall set
forth gross revenue and operating expenses for the Property. Guarantor’s annual
financial statements (as supplemented pursuant to the preceding sentence) shall
be accompanied by (x) a certificate executed by the chief financial
officer (or its equivalent) of Guarantor stating that such annual financial
statement presents fairly the financial condition and the results of operations
of Guarantor and (y) a certificate executed by the chief financial officer
(or its equivalent) of Borrower stating that the schedules attached to such
annual financial statement presents fairly the financial operating condition
and the results of operations of Borrower and the Property.  Together with such annual financial
statements, Borrower shall furnish to Lender an Officer’s

 

50

 

Certificate
certifying as of the date thereof whether to the best of Borrower’s knowledge
there exists an event or circumstance which constitutes a Default or Event of
Default by Borrower under the Loan Documents and if such Default or Event of
Default exists, the nature thereof, the period of time it has existed and the
action then being taken to remedy the same.

 

(c)           Borrower will
furnish Lender on or before the forty-fifth (45th) day after the end of each
fiscal quarter (based on Borrower’s Fiscal Year), the following items,
accompanied by certificate from the chief financial officer (or its equivalent)
of Borrower, certifying that such items are true, correct, accurate and
complete and fairly present the financial condition and results of the operations
of Borrower and the Property in accordance with GAAP as applicable:

 

(i)            quarterly and year-to-date
statements of income and expense prepared for such quarter with respect to the
Property;

 

(ii)           a calculation reflecting the
Underwritable Cash Flow as of the last day of such quarter, for such quarter
and the last four quarters;

 

(iii)          a “Major Customer List” for the
Property, and such other reasonable information requested by Lender with
respect to such “Major Customers” and listing all newly-leased space or
customers at each Individual Property and such information as Lender may
reasonably request regarding same;

 

(iv)          from and after the occurrence of an
Event of Default or special servicing of the Loan for any reason whatsoever, a
reconciliation of the budgeted income and expenses and the actual income and
expenses for such quarter and year-to-date for the Property, prepared by
Borrower in a manner consistent with its past practices; and

 

(v)           any notice received from a Tenant
threatening non-payment of an amount of Rent that is material in light of the
Underwritable Cash Flow of the Individual Property to which such threatened
non-payment relates or other default, alleging or acknowledging a default by
landlord, requesting a termination of a Lease or a material modification of any
Lease or notifying Borrower of the exercise or non-exercise of any material
option provided for in such Tenant’s Lease, or any other similar material
correspondence received by Borrower from Tenants during the subject fiscal
quarter, in each case only if the same is material in light of the
Underwritable Cash Flow of the Individual Property to which it relates.

 

(d)           Intentionally
Omitted.

 

(e)           Borrower shall
submit the Annual Budget to Lender within thirty (30) days following the commencement
of each Fiscal Year (or as soon thereafter as the Board of Trustees of
Guarantor has approved the same). During the continuation of a Cash Trap Period
or an Event of Default only, discretionary operating and capital expense items
contained in said Annual Budget (and no other matters contained therein) shall
be subject to Lender’s approval (such approval not to be unreasonably withheld,
conditioned or delayed).  Each Annual
Budget shall set forth in reasonable detail budgeted monthly operating income
and monthly operating and capital expenses and other cash expenses for the
Property.  If Lender’s approval is
required 

 

51

 

hereunder,
(i) in the event Lender objects to any discretionary operating and capital
expense item contained in a proposed Annual Budget, Lender shall advise
Borrower of such objections in writing within ten (10) Business Days after
receipt thereof (and deliver to Borrower a reasonably detailed description of
such objections), and Borrower shall revise such Annual Budget within five (5) Business
Days after receipt of such notice and resubmit the same to Lender; and (ii) Lender
shall advise Borrower in writing of any reasonable objections to any
discretionary operating and capital expense items contained in such revised
Annual Budget within five (5) Business Days after receipt thereof (and
deliver to Borrower a reasonably detailed description of such objections), and
Borrower shall revise such Annual Budget in accordance with the process
described in this Section until Lender approves all of the discretionary
operating and capital expense items contained in such Annual Budget.  Each Annual Budget which contains
discretionary operating and capital expense items approved or deemed approved
by Lender in accordance with the terms hereof shall be referred to herein as an
“Approved Annual Budget”.  If
Lender’s approval is required hereunder, until such time that Lender approves all of the discretionary operating and
capital expense items contained
in such proposed Annual Budget, with respect to any discretionary operating and
capital expense items contained therein, an increase in an amount equal to the
increase in the Consumer Price Index for All Urban Consumers since the most
recently Approved Annual Budget shall be permitted with respect to such
discretionary operating and capital expense items.  Any proposed Annual Budget submitted for
Lender’s approval of the discretionary operating and capital expense items
contained therein pursuant to this Section 4.1.6(e) which
states at the top of such submittal “THIS
ANNUAL BUDGET IS BEING SUBMITTED FOR
APPROVAL OF THE DISCRETIONARY OPERATING AND CAPITAL EXPENSE ITEMS CONTAINED
THEREIN PURSUANT TO SECTION 4.1.6(e) OF THE LOAN AGREEMENT. THE
OPERATING AND CAPITAL EXPENSE DISCRETIONARY
ITEMS CONTAINED IN THIS ANNUAL BUDGET SHALL BE DEEMED APPROVED BY LENDER IF LENDER DOES NOT NOTIFY BORROWER IN WRITING OF ITS DISAPPROVAL, TOGETHER
WITH THE GROUNDS FOR SUCH DISAPPROVAL,
WITHIN TEN (10) BUSINESS DAYS,” shall be deemed approved if Lender shall
have not notified Borrower in writing of its disapproval (together with a reasonably detailed statement of
the grounds of such disapproval) within ten (10) Business Days after
Borrower has submitted such Annual Budget in such manner to Lender.  Any revised proposed Annual Budget
resubmitted for Lender’s approval of the discretionary operating and capital
expense items contained therein pursuant to this Section 4.1.6(e) due
to Lender’s reasonable objections to any discretionary operating and capital
expense items contained in an Annual Budget previously submitted to Lender
pursuant to this Section 4.1.6(e) which states at the top of
such submittal “THIS ANNUAL BUDGET IS BEING
RESUBMITTED FOR APPROVAL OF THE DISCRETIONARY OPERATING AND CAPITAL EXPENSE ITEMS CONTAINED THEREIN PURSUANT TO SECTION 4.1.6(e) OF
THE LOAN AGREEMENT. THE DISCRETIONARY OPERATING AND CAPITAL
EXPENSE ITEMS CONTAINED IN THIS REVISED ANNUAL BUDGET SHALL BE DEEMED APPROVED
BY LENDER IF LENDER DOES NOT NOTIFY BORROWER IN WRITING OF ITS DISAPPROVAL,
TOGETHER WITH THE GROUNDS FOR SUCH DISAPPROVAL, WITHIN FIVE (5) BUSINESS DAYS,” shall be deemed approved if Lender shall
have not notified Borrower in writing of its disapproval (together with a
reasonably detailed statement of the grounds of such disapproval) within five (5) 

 

52

 

Business
Days after Borrower has submitted such revised Annual Budget in such manner to
Lender.

 

(f)            If, at the time one
or more Disclosure Documents are being prepared for a Securitization, Lender
expects that Borrower alone or Borrower and one or more Affiliates of Borrower
collectively, or the Property and Related Property collectively, will be a
Significant Obligor, Lender will so notify Borrower in writing and Borrower
shall furnish to Lender upon written request (i) the selected financial
data or, if applicable, Underwritable Cash Flow, required under Item 1112(b)(1) of
Regulation AB, if Lender expects
that the principal amount of the Loan together with any Related Loans as of the
cut-off date for such Securitization may, or if the principal amount of the Loan together with any Related
Loans as of the cut-off date for such Securitization and at any time during
which the Loan and any Related Loans are included in a Securitization does,
equal or exceed ten percent (10%) (but less than twenty percent (20%)) of the
aggregate principal amount of all mortgage
loans included or expected to be included, as applicable, in the Securitization
or (ii) the financial statements required under Item 1112(b)(2) of
Regulation AB, if Lender expects that the principal amount of the Loan together
with any Related Loans as of the cut-off date for such Securitization may, or
if the principal amount of the Loan together with any Related Loans as of the
cut-off date for such Securitization and at any time during which the Loan and
any Related Loans are included in a Securitization does, equal or exceed twenty
percent (20%) of the aggregate principal amount of all mortgage loans included
or expected to be included, as applicable, in the Securitization. Such
financial data or financial statements shall be furnished to Lender (A) within
ten (10) Business Days after notice from Lender in connection with the
preparation of Disclosure Documents for the Securitization, (B) not later
than thirty (30) days after the end of each fiscal quarter of Borrower and (C) not
later than seventy-five (75) days after the end of each fiscal year of Borrower; provided,
however, that Borrower shall not be obligated to furnish financial data
or financial statements pursuant to clauses (B) or (C) of this
sentence with respect to any period for which a filing pursuant to the Exchange
Act in connection with or relating to the Securitization is not required.  If requested by Lender, Borrower shall
furnish to Lender financial data and/or financial statements for any Tenant of
any of the Individual Properties if available to Borrower and Borrower is not
restricted from disclosing the same to Lender by such Tenant and if, in connection with a Securitization,
Lender expects there to be, with respect to such Tenant or group of affiliated
Tenants, a concentration within all of the mortgage loans included or expected
to be included, as applicable, in the Securitization such that such Tenant or
group of affiliated Tenants would constitute a Significant Obligor.

 

(g)           If requested by
Lender, Borrower shall provide such financial and other information as shall be
required pursuant to Regulation AB in connection with a Securitization.

 

(h)           All financial data
and financial statements provided by Borrower pursuant to Section 4.1.6(f) or
Section 4.1.6(g) shall meet the requirements of Regulation AB
and other applicable legal requirements, if required by Lender.

 

4.1.7            Title to the Property.  Borrower will warrant and defend the validity and priority
of the Liens of the Mortgage and the Assignment of Leases on the Property
against the claims of all Persons whomsoever, subject only to Permitted
Encumbrances.

 

53

 

4.1.8            Estoppel Statement.  (a) After
request by Lender, Borrower shall within ten (10) Business Days furnish
Lender with a statement, duly acknowledged and certified, stating to the best
of Borrower’s knowledge (i) the unpaid principal amount of the Note, (ii) the
Applicable Interest Rate of the Note, (iii) the date installments of
interest and/or principal were last paid, (iv) any offsets or defenses to
the payment of the Debt, if any, and (v) that this Agreement and the other
Loan Documents have not been modified or
if modified, giving particulars of such modification.

 

(b)           After request by
Borrower, Lender shall within ten (10) Business
Days furnish Borrower with a statement, duly acknowledged and certified, stating
(i) the unpaid principal amount of the Note, (ii) the Applicable
Interest Rate of the Note, (iii) the date installments of interest and/or
principal were last paid and (iv) whether or not Lender has sent any
notice of default under the Loan Documents which remains uncured in the opinion
of Lender.

 

4.1.9            Leases.  (a) 
All Leases and all renewals of Leases executed after the date hereof shall (i) be
on commercially reasonable terms, (ii) provide that such Lease is
subordinate to the Mortgage and that the lessee will attorn to Lender and any
purchaser at a foreclosure sale (provided, however, that Borrower
shall be required only to use commercially reasonable efforts to obtain such
subordination and attornment provisions in the Warehouse Agreements) and (iii) not
contain any terms which would materially adversely affect Lender’s rights under
the Loan Documents.  Any Major Leases and
all renewals, amendments and modifications thereof executed after the date
hereof shall be subject to Lender’s prior approval, which approval shall not be
unreasonably withheld or delayed, and subject to delivery by Borrower of a
Rating Agency Confirmation with respect to such Major Lease.  Borrower shall pay all reasonable actual
out-of-pocket costs and expenses (including reasonable attorney’s fees but
excluding internal fees) incurred by Lender or Servicer in connection with its
review of a Major Lease, including, without limitation, the fees and charges of
the Rating Agencies.  Lender shall
execute and deliver a Subordination Non-Disturbance and Attornment Agreement in
the form annexed as Schedule IV to the Tenant under any future Major
Lease approved by Lender or any other Lease entered into, subject to and in
accordance with this Section 4.1.9(a) promptly upon request
with such commercially reasonable changes as may be requested by the Tenant,
from time to time, and which are reasonably acceptable to Lender, provided
that Borrower shall pay all reasonable costs and expenses incurred by Lender in
connection with such Subordination Non-Disturbance and Attornment Agreement.

 

(b)           Borrower:

 

(i)            shall observe and perform, or cause
to be observed and performed,
in a commercially reasonable
manner the material obligations imposed upon the lessor under Leases in which
Borrower is the lessor;

 

(ii)           shall enforce, or cause to be
enforced as against, the lessees, in a commercially reasonable manner the
material terms, covenants and conditions contained in the Leases under which
Borrower is the lessor, provided, however, Borrower shall not
terminate or accept a surrender of a Major Lease without Lender’s prior
approval (which approval may be conditioned upon receipt by Lender of a Rating
Agency Confirmation) 

 

54

 

and shall not terminate
or accept a surrender of any other Lease without Lender’s approval, unless such
termination or surrender, when taken together with any replacement Lease(s),
will not have a material adverse effect on the applicable Individual Property;

 

(iii)          shall not collect, or cause or permit
to be collected, any of the Rents more than one (1) month in advance and
shall not grant its approval of Manager’s collection of any of the Rents more
than one (1) month in advance (other than security deposits);

 

(iv)          shall not grant any assignment of
lessor’s interest in the Leases or the Rents (except as contemplated by the
Loan Documents);

 

(v)           intentionally omitted; and

 

(vi)          in its capacity as lessor, shall hold all security deposits under
all Leases in accordance with Legal Requirements and upon request, shall
furnish Lender with executed copies of all Leases.

 

(c)           Any proposed Lease,
or any amendment, modification or termination of a Lease, that in each case
requires Lender’s consent pursuant to this Section 4.1.9 which is,
in each case, accompanied by a summary of the material terms of such document(s) (including
any economic terms and any termination options) and which states at the top of
such submittal “THIS IS A REQUEST FOR APPROVAL OF A LEASE, AMENDMENT,
MODIFICATION OR TERMINATION OF A LEASE PURSUANT TO SECTION 4.1.9 OF THE
LOAN AGREEMENT. THIS LEASE OR AN AMENDMENT, MODIFICATION OR TERMINATION THEREOF
SHALL BE DEEMED APPROVED BY LENDER IF LENDER DOES NOT NOTIFY BORROWER IN
WRITING OF ITS DISAPPROVAL, TOGETHER WITH THE GROUNDS FOR SUCH DISAPPROVAL,
WITHIN FIFTEEN (15) CALENDAR DAYS,” shall be deemed approved
if Lender shall have not notified Borrower in writing of its disapproval
(together with a statement of the grounds of such disapproval) within fifteen
(15) calendar days after Borrower has submitted such Lease, or any such
amendment, modification or termination of a Lease in such manner to Lender.

 

(d)           Borrower shall use
good faith efforts to obtain, within sixty (60) days after Lender’s request
therefor, Subordination, Non-Disturbance and Attornment Agreements in the form annexed as Schedule IV
from all Major Tenants then in existence.

 

4.1.10         Alterations.  (a)  Lender’s prior approval shall be required in
connection with any (i) Alterations to any Improvements (except tenant
improvements under any Lease approved by Lender or Alterations required in
order to comply with applicable Legal Requirements) that would reasonably be
expected to have a material adverse effect on Borrower’s financial condition,
the value of the Property or the ongoing cash flow of the Property or (ii) any
Alterations that are structural in nature to any Improvements (except tenant
improvements under any Lease approved by Lender or Alterations required in
order to comply with applicable Legal Requirements), the aggregate cost of
which (including any related structural Alteration) is reasonably anticipated
to exceed the Alteration Threshold, which approval shall not be unreasonably
withheld, conditioned or delayed.  If the
total unpaid amounts 

 

55

 

incurred
and to be incurred with respect to such Alterations set forth in clause (i) and
(ii) above (whether or not Lender’s prior approval is required with
respect to such Alterations), shall at any time exceed the Alteration
Threshold, Borrower shall promptly deliver to Lender, at Borrower’s option, but
subject to the next succeeding sentence, any one or more of the following: (A) as
security for the payment of such amounts and as additional security for Borrower’s
obligations under the Loan Documents any of the following: (1) cash, (2) Letters
of Credit, (3) U.S. Obligations, (4) other securities acceptable to
Lender, provided that Lender shall have received a Rating Agency Confirmation
as to the form and issuer of same, or (5) a
completion bond, provided that Lender shall have received a Rating Agency
Confirmation as to the form and issuer of same (any of the foregoing, “Alteration
Security”) and/or (B) a guaranty in the form attached as Schedule
XII from Guarantor or a Person with an Investment Grade Rating reasonably
acceptable to Lender containing the “Guaranteed Obligations” as defined therein
(each, an “Alteration Guaranty”; any Alteration Security and/or
Alteration Guaranty so delivered are collectively, the “Alteration
Collateral”).  The amount of the
Alteration Security together with the amount of the “Guaranteed Obligations”
under any Alteration Guaranty delivered pursuant to this Section 4.1.10
shall be in an amount (the “Excess Alteration Amount”) equal to the
excess of the total unpaid amounts to be incurred with respect to such
Alterations (other than such amounts to be paid or reimbursed by Tenants under
the Leases) over the Alteration Threshold, which required amount (y) shall
be reduced as such Alteration progresses in an amount which is commensurate
with the amount expended in connection with such Alteration and (z) in the
case of any Capital Expenditures, shall be reduced by the amount of any Capital
Expenditure Funds on deposit at the time such Alteration is commenced.  If the Alteration Guaranty delivered in
accordance with this Section 4.1.10 is by Guarantor, and the
aggregate potential liability of Guarantor pursuant to such Alteration Guaranty
and any and all other guarantees and indemnities delivered by Guarantor
pursuant to this Agreement and the other Loan Documents (excluding for these
purposes the Guaranty) exceeds ten percent (10%), of the outstanding principal
amount of the Loan, then Borrower shall have delivered to Lender a new non-consolidation
opinion acceptable to the Rating Agencies which states that the existence of
such Alteration Guaranty does not alter any of the conclusions contained in any
non-consolidation opinion previously delivered to Lender in connection with the
Loan.  If any other Person other than
Guarantor delivers an Alteration Guaranty in accordance with this Section 4.1.10,
Borrower shall have delivered to Lender a new non-consolidation opinion
acceptable to the Rating Agencies which states that the existence of such
Alteration Guaranty does not alter any of the conclusions contained in any
non-consolidation opinion previously delivered to Lender in connection with the
Loan and which includes an additional pairing between Borrower and such other
Person.  Lender hereby agrees to accept
on a several (but not joint) basis the aggregate Alteration Collateral required
pursuant to this Section 4.1.10 in such proportions as Borrower may
specify.  Any and all Alterations shall
be performed in compliance with all Legal Requirements in a manner that does
not significantly disrupt the business otherwise conducted at each Individual
Property.  Upon completion of the
Alterations to which any security delivered by Borrower pursuant to this Section 4.1.10
relates, Lender shall promptly return such excess security to Borrower.

 

(b)           Any proposed
Alteration that requires Lender’s consent pursuant to this Section 4.1.10
which is, in each case, accompanied by a reasonably detailed description of the
Alteration and the plans and specifications therefor and which states at the
top of such submittal “THIS IS A REQUEST FOR
APPROVAL OF AN ALTERATION PURSUANT TO 

 

56

 

SECTION 4.1.10 OF THE LOAN AGREEMENT. THIS
ALTERATION SHALL BE DEEMED APPROVED BY LENDER IF LENDER DOES NOT NOTIFY
BORROWER IN WRITING OF ITS DISAPPROVAL, TOGETHER WITH THE GROUNDS FOR SUCH
DISAPPROVAL, WITHIN FIFTEEN (15) BUSINESS DAYS,” shall be deemed approved if Lender shall have not
notified Borrower in writing of its disapproval (together with a reasonably
detailed statement of the grounds of such disapproval) within fifteen (15) Business
Days after Borrower has submitted such request for approval of a proposed
Alteration in such manner to Lender.

 

4.1.11         Intentionally
Omitted.

 

4.1.12         Material
Agreements.  Borrower shall, to the extent Borrower’s
failure to so act would cause a material adverse effect upon Borrower’ ability
to perform its obligations under this Agreement or the other Loan Documents, (a) promptly
perform and/or observe all of the material covenants and agreements required to
be performed and observed by it under each Material Agreement to which it is a
party, and do all things necessary to preserve and to keep unimpaired its
rights thereunder unless the other party thereunder is in default of its
obligations to Borrower, (b) promptly notify Lender in writing of the
giving of any notice of any default by any party under any Material Agreement
of which it is aware and (c) promptly enforce the performance and
observance of all of the material covenants and agreements required to be
performed and/or observed by the other party under each Material Agreement to
which it is a party in a commercially reasonable manner.

 

4.1.13         Performance
by Borrower.  Borrower shall in a timely manner observe,
perform and fulfill each and every covenant, term and provision of each Loan
Document executed and delivered by Borrower, and shall not enter into or
otherwise suffer or permit any amendment, waiver, supplement, termination or
other modification of any Loan Document executed and delivered by Borrower
without the prior consent of Lender.

 

4.1.14         Costs
of Enforcement/Remedying Defaults. 
In the event (a) that the Mortgage is foreclosed in whole or in
part or, following the occurrence and during the continuance of an Event of
Default, the Note or any other Loan Document is put into the hands of an
attorney for collection, suit, action or foreclosure, (b) of the
foreclosure of any Lien or Mortgage prior to or subsequent to the Mortgage in
which proceeding Lender is made a party, (c) of the bankruptcy,
insolvency, rehabilitation or other similar proceeding in respect of Borrower
or Guarantor or an assignment by Borrower or Guarantor for the benefit of its
creditors, or (d) Lender shall remedy or attempt to remedy any Event of
Default hereunder, Borrower shall be chargeable with and agrees to pay all
costs incurred by Lender as a result thereof, including costs of collection and
defense (including reasonable attorneys’, experts’, consultants’ and witnesses’
fees and disbursements) in connection therewith and in connection with any
appellate proceeding or post-judgment action involved therein, which shall be
due and payable on demand, together with interest thereon from the date
incurred by Lender at the Default Rate, and together with all required service
or use taxes.

 

4.1.15         Business and Operations.  Borrower will continue to engage in the businesses currently
conducted by it as and to the
extent the same are necessary for the ownership, operation and leasing of the
Property.  Borrower will qualify to do business and will 

 

57

 

remain
in good standing under the laws of each jurisdiction as and to the extent the
same are required for the ownership, operation and leasing of the related
Property.  Borrower shall at all times
cause the Property to be maintained as cold and/or dry storage warehouse
facilities and uses incidental thereto.

 

4.1.16         Intentionally
Omitted.

 

4.1.17         Intentionally
Omitted.

 

4.1.18         Cash Management Agency
Agreement.  (a)  Borrower shall observe and perform, and
shall cause each party thereto to observe and perform, in a commercially
reasonable manner the material obligations imposed upon Borrower or any other
party thereto under each agreement comprising the Cash Management Agency
Agreement, except where the failure to so observe and perform would not have a
Material Adverse Effect.

 

(b)           Borrower shall
enforce, as against each counterparty thereto, its rights under each agreement
comprising the Cash Management Agency Agreement to which it is a party, in a commercially reasonable manner,
except where the failure to enforce such rights under the Cash Management
Agency Agreement would not have a Material Adverse Effect; provided, however,
that, Borrower shall not terminate or accept a surrender of, or cause or permit
the termination or surrender of any agreement comprising the Cash Management
Agency Agreement without Lender’s prior approval, except where the termination
or acceptance of a surrender of any such agreement comprising the Cash
Management Agency Agreement would not have a Material Adverse Effect.

 

Section 4.2            Borrower
Negative Covenants.  Borrower covenants and agrees with Lender
that:

 

4.2.1            Due on Sale and
Encumbrance; Transfers of Interests.  Without the prior written consent of Lender, neither Borrower
nor any other Person having a direct or indirect ownership or beneficial
interest in Borrower shall sell, convey, mortgage, grant, bargain, encumber,
pledge, assign or Transfer any interest, direct or indirect, in the Borrower,
the Property or any part thereof, whether voluntarily or involuntarily, by
operation of law or otherwise, in violation of the covenants and conditions set
forth in the Mortgage and this Agreement.

 

4.2.2            Liens.  Subject to Borrower’s right to contest Taxes or Other Charges
pursuant to this Agreement or any other Loan Documents, Borrower shall not
create, incur, assume or suffer to exist any Lien on any portion of the
Property except for Permitted Encumbrances.

 

4.2.3            Dissolution.  Borrower shall not (i) engage in any dissolution,
liquidation or consolidation or merger with or into any other business entity, (ii) engage in any
business activity not related to the ownership and operation of the Property or
(iii) transfer, lease or sell, in one transaction or any combination of
transactions, all or substantially all of the property or assets of Borrower except
to the extent expressly permitted by the Loan Documents.

 

58

 

4.2.4            Change in Business.  Borrower shall not enter into any line of business other
than the ownership and operation of the Property.

 

4.2.5            Debt Cancellation.  Borrower shall not
cancel or otherwise forgive or release any claim or debt (other than termination
of Leases subject to the requirements hereof) owed to Borrower by any Person,
except for adequate consideration and in the ordinary course of Borrower’s
business.

 

4.2.6            Affiliate Transactions.  Other than as expressly permitted herein, Borrower shall
not enter into, or be a party to, any transaction with an Affiliate of Borrower
or any of the partners of Borrower except in the ordinary course of business
and on terms which are fully disclosed to Lender in advance and are no less
favorable to Borrower or such Affiliate than would be obtained in a comparable
arm’s length transaction with an unrelated third party.

 

4.2.7            Zoning.  Except as would not have a material adverse effect on
Borrower’s ability to perform its obligations hereunder, Borrower shall not
initiate or consent to any zoning reclassification of any portion of any
Individual Property or seek any variance under any existing zoning ordinance or
use or permit the use of any portion of any Individual Property in any manner
that could result in such use becoming a non-conforming use under any zoning
ordinance or any other applicable land use law, rule or regulation, without the prior consent of Lender.

 

4.2.8            Assets.  Borrower shall not purchase or own any property other than
the Property and any property necessary or incidental for the operation of the
Property.

 

4.2.9            No Joint Assessment.  Borrower shall not suffer, permit or initiate the joint
assessment of any Individual Property (i) with any other real property
constituting a tax lot separate from any Individual Property, and (ii) with
any portion of any Individual Property which may be deemed to constitute
personal property, or any other procedure whereby the lien of any taxes which
may be levied against such personal property shall be assessed or levied or
charged to any Individual Property.

 

4.2.10         Principal Place of
Business.  Borrower shall not change its principal place
of business from the address set forth on the first page of this Agreement
without first giving Lender ten (10) days’ prior notice.

 

4.2.11         ERISA.  (a) 
Borrower shall not engage in any transaction which would cause any obligation,
or action taken or to be taken, hereunder (or the exercise by Lender of any of
its rights under the Note, this Agreement or the other Loan Documents) to be a
non-exempt (under a statutory or administrative class exemption) prohibited
transaction under ERISA or Section 4975
of the Code.

 

(b)           Borrower shall
deliver to Lender such certifications or other evidence from time to time
throughout the term of the Loan, as requested by Lender in its sole discretion,
that (A) Borrower is not an “employee benefit plan” as defined in Section 3(3) of
ERISA, whether or not subject to Title I of ERISA, or a “plan” within the
meaning of Section 4975 of
the Code; and (B) one or more of the following circumstances is true:

 

59

 

(i)            Equity interests in Borrower are
publicly offered securities, within the meaning of the Plan Assets Regulation;

 

(ii)           Less than twenty-five percent (25%) of each
outstanding class of equity interests in Borrower is held by “benefit plan
investors” within the meaning of the Plan Assets Regulation; or

 

(iii)          Borrower qualifies as an “operating
company” or a “real estate operating company” within the meaning of the Plan
Assets Regulation.

 

4.2.12         Material Agreements.  Except as would not have a material adverse
effect on Borrower’s ability to perform its obligations under this Agreement
and the other Loan Documents, Borrower shall not, without Lender’s prior
written consent: (a) enter into any Material Agreement, except on
commercially reasonable terms, (b) surrender or terminate any Material
Agreement to which it is a party other than in the ordinary course of Borrower’s
business, including where the same is being replaced or is no longer necessary
(unless the other party thereto is in material default and the termination of
such agreement would be commercially reasonable), (c) increase or consent
to the increase of the amount of any charges under any Material Agreement to
which it is a party, except as provided therein or on an arms’ length basis and
commercially reasonable terms; or (d) otherwise modify, change,
supplement, alter or amend, or waive or release any of its rights and remedies
under any Material Agreement to which it is a party in any material respect
other than in the ordinary course of Borrower’s business, except on an arm’s
length basis and commercially reasonable terms.

 

4.2.13         Intentionally
Omitted.

 

4.2.14         Intentionally
Omitted.

 

4.2.15         Intentionally
Omitted.

 

4.2.16         Cash Management Agency
Agreement.  Borrower shall not, without the prior written
consent of Lender, modify, supplement, restate, amend or waive any provision of
the Cash Management Agency Agreement in any manner whatsoever that (a) reduces
the amount payable by the counterparty thereto to Borrower thereunder, (b) reduces
or otherwise limits Borrower’s right to terminate the Cash Management Agency
Agreement or (c) would cause or result in a Material Adverse Effect.  Nothing contained in this Agreement or any
other Loan Document shall constrain the termination of the Cash Management
Agency Agreement so long as such termination would not have a Material Adverse
Effect.

 

V.                                    INSURANCE, CASUALTY AND CONDEMNATION

 

Section 5.1            Insurance.

 

5.1.1            Insurance Policies.  (a)  Borrower shall obtain and maintain, or cause to be
maintained, insurance for Borrower and the Property providing at least the
following coverages:

 

60

 

(i)            all risk insurance on the
Improvements and the personal property at the Property, including contingent
liability from Operation of Building Laws, Demolition Costs and Increased Cost
of Construction Endorsements, in each case (A) in an amount equal to (x) so
long as the Carthage Property is an Individual Property, one hundred percent (100%) of the “Full Replacement Cost” of the
Carthage Property which, for purposes of this Agreement, shall mean actual
replacement value (exclusive of costs of excavations, foundations, underground
utilities and footings) with a waiver of depreciation or, (y) if the
Carthage Property is no longer an Individual Property, One Hundred Fifty Million and No/100 Dollars
($150,000,000.00); (B) containing an agreed amount endorsement with respect
to the Improvements and personal property at the Property waiving all
co-insurance provisions; (C) providing for no deductible in excess of Two
Hundred Fifty Thousand and No/100 Dollars ($250,000) (except with respect to floods, wind and earthquakes,
each of which shall be limited to 5% of
the insurable value per loss) for all such insurance coverage; and (D) containing
an “Ordinance or Law Coverage” (sublimit of $10,000,000 for property damage and
$2,000,000 for business interruption in respect of the Property or such lesser
sublimits as may be commercially available as determined by Lender in its
reasonable discretion) or “Enforcement” endorsement if any of the Improvements
or the use of the Property shall at any time constitute legal non-conforming structures
or uses.  In addition, Borrower shall
obtain:  (y) if any portion of the
Improvements at any Individual Property is currently or at any time in the future located in a federally
designated “special flood hazard area,” flood hazard insurance in an amount
equal to the lesser of (1) the Allocated Loan Amount of such Individual
Property or (2) the maximum amount of such insurance available under the
National Flood Insurance Act of 1968, the Flood Disaster Protection Act of 1973
or the National Flood Insurance Reform Act of 1994, as each may be amended; and
(z) earthquake insurance in amounts and in form and substance satisfactory
to Lender in the event any Individual Property is located in an area with a
high degree of seismic activity, provided that the insurance pursuant to
clauses (y) and (z) hereof shall be on terms consistent with the all
risk insurance policy required under this subsection (i).

 

(ii)           commercial general liability
insurance against claims for personal injury, bodily injury, death or property
damage occurring upon, in or about the Property, such insurance (A) to be
on the so-called “occurrence” form with a combined limit, including umbrella
coverage, of not less than Twenty-Five Million and No/100 Dollars
($25,000,000); (B) to continue at not less than the aforesaid limit until
required to be changed by Lender by reason of changed economic conditions
making such protection inadequate; and (C) to cover at least the following
hazards: (1) premises and operations; (2) products and completed
operations on an “if any” basis; (3) independent contractors; (4) blanket
contractual liability for all legal contracts; and (5) contractual liability covering the indemnities
contained in Article 9 of the Mortgage to the extent the same is
available, the terms of excess coverage to “follow form” over the primary
general liability insurance and the commercial motor vehicle liability coverage
required under clause (viii) below;

 

(iii)          business income insurance (A) with
loss payable to Lender; (B) covering all risks required to be covered by
the insurance provided for in subsection (i) above for a period commencing
at the time of loss for such length of time as it takes to repair or 

 

61

 

replace with the exercise
of due diligence and dispatch, but in no event in an amount less than one year;
and (C) containing an extended period of indemnity endorsement which
provides that after the physical loss to the Improvements and Personal Property
has been repaired, the continued loss of income will be insured until such
income either returns to the same level it was at prior to the loss, or the
expiration of one hundred twenty (120) days from the date that the affected
Individual Property is repaired or replaced and operations are resumed,
whichever first occurs, and notwithstanding that the policy may expire prior to
the end of such period.  The amount of
coverage required for business income insurance pursuant to this Section 5.1.l(a)(iii) shall be included in the coverage
amounts specified in Section 5.1.1(a)(i) above.  All proceeds payable to Lender pursuant to
this subsection shall be held by Lender and shall be applied to the obligations
secured by the Loan Documents from time to time due and payable hereunder and under
the Note; provided, however, that nothing herein contained shall
be deemed to relieve Borrower of its obligations to pay the obligations secured
by the Loan Documents on the respective dates of payment provided for in the
Note and the other Loan Documents except to the extent such amounts are
actually paid out of the proceeds of such business income insurance;

 

(iv)          at all times during which structural
construction, repairs or alterations are being made with respect to the
Improvements, and only if the Property coverage form does not otherwise apply, (A) owner’s
contingent or protective liability insurance covering claims not covered by or
under the terms or provisions of the above mentioned commercial general
liability insurance policy; and (B) the insurance provided for in
subsection (i) above written in a so-called builder’s risk completed value
form (1) on a non-reporting basis, (2) against all risks insured
against pursuant to subsection (i) above, (3) including permission to
occupy the Property, and (4) with an agreed amount endorsement waiving
co-insurance provisions;

 

(v)           workers’ compensation, subject to the
statutory limits of the state in which the Property is located, and
employer’s liability insurance with a limit of at least One Million and No/100
Dollars ($1,000,000) per accident and per disease per employee, and One Million
and No/100 Dollars ($1,000,000) for disease aggregate in respect of any work or
operations on or about the Property, or in connection with the Property or its
operation (if applicable);

 

(vi)          boiler and machinery insurance, if
applicable, in amounts as shall be reasonably required by Lender on terms
consistent with the commercial property insurance policy required under
subsection (i) above;

 

(vii)         Intentionally Omitted;

 

(viii)        motor vehicle liability coverage for all
owned and non-owned vehicles, including rented and leased vehicles containing
minimum limits per occurrence, including umbrella coverage, of One Million and
No/100 Dollars ($1,000,000);

 

(ix)           Intentionally Omitted;

 

62

 

(x)            insurance against employee
dishonesty in an amount not less than Three Million and No/100 Dollars
($3,000,000) and with a deductible not greater than One Hundred Thousand and
No/100 Dollars ($100,000);

 

(xi)           (A)  during any period of the
term of the Loan that TRIA is in effect, if “acts of terrorism” or other
similar acts or events are hereafter excluded from Borrower’s all risk
insurance policy (including business income), Borrower shall obtain an
endorsement to such policy insuring against all “certified acts of terrorism”
as defined by TRIA, in an amount equal to the Release Amount applicable to the
Individual Property with the highest then-outstanding Allocated Loan
Amount.  The endorsement shall be in form
and substance reasonably satisfactory to Lender and shall meet Rating Agency
criteria for securitized loans; or

 

(B)           during any period of
the term of the Loan that TRIA is not in effect, or the endorsement referred to
in (A) above is not available, if “acts of terrorism” or other similar
acts are hereafter excluded from Borrower’s all risk insurance policy or
business income insurance coverage, Borrower shall obtain an endorsement to such policy or a
separate policy from
an insurance provider, insuring against all such excluded acts or events, to
the extent such policy or endorsement is available, in an amount determined by
Lender in its reasonable discretion (but in no event greater than the Release
Amount applicable to the Individual Property with the highest then-outstanding
Allocated Loan Amount, plus required business income coverage); provided,
however, Borrower shall not be required to pay annual premiums in excess
of $129,300.00 for such coverage. 
The endorsement or policy shall be in form and substance reasonably satisfactory to Lender and shall meet
Rating Agency criteria for securitized loans; and

 

(xii)          upon sixty (60) days’ notice, such
other reasonable insurance and in such reasonable amounts as Lender from time
to time may reasonably request against such other insurable hazards which at
the time are commonly insured against for property similar to the Property located
in or around the region in which the Property is located, provided such
insurance is generally available at commercially reasonable premiums.

 

(b)           All insurance
provided for in Section 5.1.1(a) shall
be obtained under valid and enforceable policies (collectively, the “Policies”
or in the singular, the “Policy”) and, to the extent not specified
above, shall be subject to the approval of Lender as to deductibles, loss
payees and insureds Not less than ten (10) days prior to the expiration
dates of the Policies theretofore furnished to Lender, certificates of
insurance evidencing the Policies accompanied by evidence satisfactory to
Lender of payment of the premiums then due thereunder (the “Insurance
Premiums”), shall be delivered by Borrower to Lender.

 

(c)           Borrower shall have
the right to effect the coverages required hereunder under one or more blanket
insurance Policies that cover the Property as well as other properties of
Borrower’s Affiliates, provided that any blanket insurance Policy shall
provide substantially the same protection required hereunder in respect of the
Property as would a separate Policy insuring only the Property in compliance
with the provisions of Section 5.1.1(a) taking
into account the geographic diversity of the Property.

 

63

 

(d)           All Policies of
insurance provided for or contemplated by Section 5.1.1(a) shall
be primary coverage and, except for the Policy referenced in Section 5.1.1(a)(v) and
Section 5.1.1(a)(x), shall name
Borrower as the insured and Lender and its successors and/or assigns as the
additional insured, as its interests may appear, and in the case of property
damage, boiler and machinery, flood, earthquake and terrorism insurance, shall
contain a so-called New York standard non-contributing mortgagee clause in
favor of Lender providing that the loss thereunder shall be payable to Lender.  Borrower shall not procure or permit any of
its constituent entities to procure any other insurance coverage which would be
on the same level of payment as the Policies or would adversely impact in any
way the ability of Lender or Borrower to collect any proceeds under any of the
Policies.

 

(e)           All Policies of
insurance provided for in Section 5.1.1(a), except for the Policies
referenced in Section 5.1.1(a)(v) and (a)(viii) shall
contain clauses or endorsements to the effect that:

 

(i)            no act or negligence of Borrower, or
anyone acting for Borrower, or of any Tenant or other occupant, or failure to
comply with the provisions of any Policy, which might otherwise result in a
forfeiture of the insurance or any part thereof, shall in any way affect the validity
or enforceability of the insurance insofar as Lender is concerned;

 

(ii)           the Policy shall not be canceled
without at least thirty (30) days’ written notice to Lender and any
other party named therein as an additional insured and, if obtainable by Borrower
using commercially reasonable efforts, shall not be materially changed (other
than to increase the coverage provided thereby) without such a thirty (30) day
notice; and

 

(iii)          Lender shall not be liable for any
Insurance Premiums thereon or subject to any assessments thereunder.

 

(f)            If at any time
Lender is not in receipt of written evidence that all insurance required
hereunder is in full force and effect, Lender shall have the right, upon ten (10) days
prior written notice to Borrower, to take such action as Lender deems necessary
to protect its interest in the Property, including, without limitation, the
obtaining of such insurance coverage as Lender in its sole discretion deems
appropriate and all premiums incurred by Lender in connection with such action
or in obtaining such insurance and keeping it in effect shall be paid by
Borrower to Lender upon demand and until paid shall be secured by the Mortgage
and shall bear interest at the Default Rate.

 

(g)           In the event of foreclosure of the
Mortgage or other transfer of title to the Property in extinguishment in whole
or in part of the Debt, all right, title and interest of Borrower in and to the
Policies that are not blanket Policies then in force concerning the Property
and all proceeds payable thereunder shall thereupon vest in the purchaser at
such foreclosure or Lender or other transferee in the event of such other
transfer of title.

 

5.1.2            Insurance Company.  The Policies shall be issued by financially sound and
responsible insurance companies permitted to do business in the State in which
each 

 

64

 

Individual
Property is located. For so long as six (6) or more insurance carriers are
providing the Policies, at least sixty percent (60%) of such coverage shall be
provided by insurance companies having a claims paying ability rating of “A-” or better by S&P with the
remaining forty percent (40%) of such coverage being provided by insurance
companies having a claims paying ability rating of “BBB-” or better by S&P;
provided, however, with respect to the first One Hundred Million
and No/l00 Dollars ($100,000,000.00) of coverage under such Policies, not more
than twenty percent (20%) of such coverage shall be provided by insurance
companies with a claims paying ability rating lower than “A-” by S&P (but
in no event lower than “BBB-” by S&P). 
In the event that five (5) or fewer insurance earners are providing
the Policies, each insurance company providing such coverage shall have with a
claims paying ability rating of “A-” or better by S&P.  If a Securitization occurs, (i) the
foregoing required insurance company rating by a Rating Agency not rating any
Securities shall be disregarded and (ii) if the insurance company complies
with the aforesaid S&P required rating (and S&P is rating the
Securities) and the other Rating Agencies rating the Securities do not rate the
insurance company, such insurance company shall be deemed acceptable with
respect to such Rating Agency not rating such insurance company.  Notwithstanding the foregoing, Borrower shall
be permitted to maintain the Policies with insurance companies which do not
meet the foregoing requirements (an “Otherwise Rated Insurer”), provided
Borrower obtains a “cut-through” endorsement (that is an endorsement which
permits recovery against the provider of such endorsement) with respect to any
Otherwise Rated Insurer from an insurance company which meets the claims paying
ability ratings required above. Moreover, if Borrower desires to maintain
insurance required hereunder from an insurance company which does not meet the
claims paying ability ratings set forth herein but the parent of such insurance
company, which owns at least fifty-one percent (51%)
of such insurance
company, maintains such ratings, Borrower may use such insurance companies if
approved by the Rating Agencies (such approval may be conditioned on items
required by the Rating Agencies including a requirement that the parent
guarantee the obligations of such insurance company).

 

5.1.3            Current Insurance.  Lender hereby acknowledges that the insurance coverages
under the certificates of insurance delivered to Lender in connection with the
execution and delivery of this Agreement are currently acceptable to Lender as
of the date hereof for the periods covered under the policies described in said
certificates for purposes of this Section 5.1.

 

Section 5.2            Casualty
and Condemnation.

 

5.2.1            Casualty.  If any Individual Property shall sustain a Casualty,
Borrower shall give prompt notice of such Casualty to Lender and shall promptly
commence and diligently prosecute to completion the repair and restoration of
such Individual Property as nearly as possible to the condition such Individual
Property was in immediately prior to such Casualty (a “Restoration”) and
otherwise in accordance with Section 5.3, it
being understood, however, that Borrower
shall not be
obligated to restore such Individual Property to the precise condition of such
Individual Property prior to such Casualty provided the Individual Property is
restored, to the extent practicable, to be of at least equal value and of
substantially the same character as prior to the Casualty.  Borrower shall pay all costs of such
Restoration whether or not such costs are covered by insurance.  Lender may, but shall not be obligated to,
make proof of loss if not made promptly by Borrower.  In the event of a Casualty where the loss
does not exceed the 

 

65

 

Restoration
Threshold, Borrower may settle and adjust such claim; provided that (a) no
Event of Default has occurred and is continuing and (b) such adjustment is
carried out in a commercially reasonable and timely manner.  In the event of a Casualty where the loss
exceeds the Restoration Threshold or if an Event of Default then exists,
Borrower may settle and adjust such claim only with the consent of Lender
(which consent shall not be unreasonably withheld or delayed) and Lender shall
have the opportunity to participate, at Borrower’s cost, in any such adjustments.  Notwithstanding any Casualty, Borrower shall
continue to pay the Debt at the time and in the manner provided for its payment
in the Note and in this Agreement.

 

5.2.2            Condemnation.  Borrower shall give Lender prompt notice of any actual or
threatened Condemnation by any Governmental Authority of all or any part of any
Individual Property and shall deliver to Lender a copy of any and all papers
served in connection with such proceedings. Provided no Event of Default has
occurred and is continuing, in the event of a Condemnation where the amount of
the taking does not exceed the Restoration Threshold, Borrower may settle and
compromise such Condemnation; provided that the same is effected in a
commercially reasonable and timely manner. 
In the event of a Condemnation where the amount of the taking exceeds
the Restoration Threshold or if an Event of Default then exists, Borrower may
settle and compromise the Condemnation only with the consent of Lender (which
consent shall not be unreasonably withheld or delayed) and Lender shall have
the opportunity to participate, at Borrower’s cost, in any litigation and
settlement discussions in respect thereof and Borrower shall from time to time
deliver to Lender all instruments requested by Lender to permit such participation.  Borrower shall, at its expense, diligently
prosecute any such proceedings, and shall consult with Lender, its attorneys
and experts, and cooperate with them in the carrying on or defense of any such
proceedings.  Notwithstanding any
Condemnation, Borrower shall continue to pay the Debt at the time and in the
manner provided for its payment in the Note and in this Agreement.  Lender shall not be limited to the
interest paid on the Award by any Governmental Authority but shall be entitled
to receive out of the Award interest at the rate or rates provided herein or in
the Note.  If any Individual Property or
any portion thereof is taken by any Governmental Authority, Borrower shall
promptly commence and diligently prosecute the Restoration of the Property and
otherwise comply with the provisions of Section 5.3.  If any Individual Property is sold by or on behalf of
Lender subsequent to acceleration, through foreclosure or otherwise, prior to
the receipt by Lender of the Award, Lender shall have the right,
whether or not a deficiency judgment on the Note shall have been
sought, recovered or denied, to receive the Award, or a portion thereof
sufficient to pay the Debt.

 

5.2.3            Casualty Proceeds.  Notwithstanding the last sentence of Section 5.1.1(a)(iii) and
provided no Event of Default exists hereunder, proceeds received by Lender on
account of the business interruption insurance specified in Section 5.1.1(a)(iii) above
with respect to any Casualty shall be deposited by Lender directly into
the Deposit Account (as defined in the Cash Management Agreement) but (a) only
to the extent it reflects a replacement for (i) lost Rents that would have
been due under Leases or Service Contracts existing on the date of such
Casualty, and/or (ii) lost Rents under Leases or Service Contracts that
had not yet been executed and delivered at the time of such Casualty which
Borrower has proven to the insurance company would have been due under such
Leases (and then only to the extent such proceeds disbursed by the insurance
company reflect a replacement for such past due Rents) and (b) only to the
extent necessary to fully make the disbursements required by Sections 3.3(a)(i) 

 

66

 

through
(vi) of the Cash Management Agreement.  All other such proceeds shall be held by
Lender and disbursed in accordance with Section 5.3  hereof.

 

Section 5.3            Delivery
of Net Proceeds.

 

5.3.1            Minor Casualty or
Condemnation.  If a Casualty or Condemnation has occurred
to any Individual Property and the Net Proceeds shall be less than the
Restoration Threshold and the costs of completing the Restoration shall be less
than the Restoration Threshold, and provided no Event of Default shall have
occurred and remain uncured, the Net Proceeds will be disbursed by Lender to
Borrower. Promptly after receipt of the Net Proceeds, Borrower shall commence
and satisfactorily complete with due diligence the Restoration in accordance
with the terms of this Agreement.  If any
Net Proceeds are received by Borrower and may be retained by Borrower pursuant
to the terms hereof, such Net Proceeds shall, until completion of the
Restoration, be held in trust for Lender and shall be segregated from other
funds of Borrower to be used to pay for the cost of Restoration in accordance
with the terms hereof.

 

5.3.2            Major Casualty or
Condemnation.  (a) If a Casualty or Condemnation has
occurred to any Individual Property and the Net Proceeds are equal to or
greater than the Restoration Threshold or the costs of completing the Restoration
is equal to or greater than the Restoration Threshold, Lender shall make the
Net Proceeds available for the Restoration, provided that each of the following
conditions are met:

 

(i)            no Event of Default shall have
occurred and be continuing;

 

(ii)           (A) in the event the Net
Proceeds are insurance proceeds, less than forty percent (40%) (or in the case
of the Carthage Property only, thirty percent (30%)) of the total floor area of
the Improvements at such Individual Property has been damaged, destroyed or rendered
unusable as a result of such Casualty or (B) in the event the Net Proceeds
are an Award, less than fifteen percent (15%)
of the land
constituting such Individual Property is taken, and such land is located along
the perimeter or periphery of such Individual Property, and no portion of the
Improvements is the subject of the Condemnation;

 

(iii)          The projected aggregate Gross Revenue
for the Property after completion of the Restoration (as reasonably determined
by Lender) shall not be reduced as a result of the occurrence of such Casualty
or Condemnation by more than twenty percent (20%) as compared to the Gross
Revenue received by Borrower during the twelve (12) month period immediately
preceding such Casualty or Condemnation;

 

(iv)          Borrower shall commence the
Restoration as soon as reasonably practicable and shall diligently pursue the
same to satisfactory completion;

 

(v)           Lender shall be satisfied that any
operating deficits and all payments of principal and interest under the Note
will be paid during the period required for Restoration from (A) the Net
Proceeds (including sums received from the proceeds of the coverage required
pursuant to Section 5.1.1(a)(iii)), or (B) other funds of
Borrower;

 

67

 

(vi)          Lender shall be satisfied that the
Restoration will be completed on or before the earliest to occur of (A) the
date six (6) months prior to the Maturity Date, (B) the earliest date
required for such completion under the terms of any Lease covering 25% or more
of the applicable Individual Property or (C) such time as may be required
under applicable Legal Requirements in order to repair and restore the Property
to the condition it was in immediately prior to such Casualty or to as nearly
as possible the condition it was in immediately prior to such Condemnation, as
applicable;

 

(vii)         such Individual Property and the use
thereof after the Restoration will be in compliance with and permitted under
all applicable Legal Requirements;

 

(viii)        the Restoration shall be done and
completed by Borrower in an expeditious and diligent fashion and in compliance
with all applicable Legal Requirements; and

 

(ix)           such Casualty or Condemnation, as
applicable, does not result in the loss of access to such individual Property or
the related Improvements (except if the same is effectively replaced).

 

(b)           The Net Proceeds
shall be paid directly to Lender and held by Lender in an interest-bearing
account (with such interest being credited to such account) and, until
disbursed in accordance with the provisions of this Section 5.3.2,
shall constitute additional security for the Debt.  The Net Proceeds shall be disbursed by Lender
to, or as directed by, Borrower from time to time during the course of the
Restoration, upon receipt of evidence satisfactory to Lender that (A) all
requirements set forth in Section 5.3.2(a) have been
satisfied, (B) all materials installed and work and labor performed
(except to the extent that they are to be paid for out of the requested
disbursement) in connection with the Restoration have been paid for in full,
and (C) there exist no notices of pendency, stop orders, mechanic’s or
materialman’s liens or notices of intention to file same, or any other liens or
encumbrances of any nature whatsoever on the Individual Property arising out of
the Restoration which have not been fully bonded to the reasonable satisfaction
of Lender, discharged of record or fully insured to the reasonable satisfaction
of Lender by the title company issuing the Title Insurance Policy (or another
reputable title company satisfactory to Lender).

 

(c)           The Restoration
shall be completed in a first class workmanlike manner at least equivalent to
the quality and character of the original work in the Improvements (provided,
however, that in the case of a partial Condemnation, the Restoration
shall be done to the extent reasonable practicable after taking into account
the consequences of such partial Condemnation), so that upon completion
thereof, the Individual Property shall be at least equal in value and general
utility to such Individual
Property prior to the damage or destruction; it being understood, however, that
Borrower shall not be obligated to restore the Individual Property to the
precise condition of such Individual Property prior to such Casualty provided
the Individual Property is restored, to the extent practicable, to be of at
least equal value and of substantially the same character as prior to the
Casualty.  Borrower shall restore all Improvements
such that when they are fully restored and/or repaired, such Improvements and
their contemplated use fully comply with all applicable material Legal
Requirements.  All reasonable
out-of-pocket costs and expenses incurred by Lender in connection with
recovering, holding and advancing the Net

 

68

 

Proceeds for the
Restoration including, without limitation, reasonable attorneys’ fees and
disbursements and the Casualty Consultant’s fees and disbursements, shall be
paid by Borrower.

 

(d)           In no event shall
Lender be obligated to make disbursements of the Net Proceeds in excess of an
amount equal to the costs actually incurred from time to time for work in place
as part of the Restoration, as certified by Borrower, less the Casualty
Retainage.  The term “Casualty
Retainage” shall mean, as to each contractor, subcontractor or materialman
engaged in the Restoration, an amount equal to ten percent (10%) of the costs actually incurred
for work in place as part of the Restoration, as certified by Borrower, until
the Restoration has been completed.  The
Casualty Retainage shall in no event, and notwithstanding anything to the contrary set forth above in
this Section 5.3.2(d), be less than the amount actually held hack
by Borrower from contractors, subcontractors and materialmen engaged in the
Restoration.  The Casualty Retainage
shall not be released until Borrower certifies to Lender that the Restoration
has been completed in accordance with the provisions of this Section 5.3.2(d) and that all approvals necessary for the re-occupancy and
use of the Property have been obtained from all appropriate Governmental
Authorities, and Lender receives evidence satisfactory to Lender that the costs
of the Restoration have been paid in full or will be paid in full out of the
Casualty Retainage; provided, however, that Lender will release
the portion of the Casualty Retainage being held with respect to any
contractor, subcontractor or materialman engaged in the Restoration as of the
date upon which Borrower certifies to Lender that the contractor, subcontractor
or materialman has substantially completed all work in a satisfactory manner
and has supplied all materials in accordance with the provisions of the
contractor’s, subcontractor’s or materialman’s contract, the contractor,
subcontractor or materialman delivers the lien waivers and evidence of payment
in full of all sums due to the contractor, subcontractor or materialman as may
be reasonably requested by Lender or by the title company issuing the Title
Insurance Policy (or another reputable title company satisfactory to Lender),
and Lender receives an endorsement to the Title Insurance Policy insuring the
continued priority of the lien of the Mortgage and evidence of payment of any
premium payable for such endorsement.  If
required by Lender, the release of any such portion of the Casualty Retainage
shall be approved by the surety company, if any, which has issued a payment or
performance bond with respect to the contractor, subcontractor or materialman.

 

(e)           Lender shall not be
obligated to make disbursements of the Net Proceeds more frequently than once
every calendar month.

 

(f)            If at any time the
Net Proceeds or the undisbursed balance thereof shall not, in the reasonable
opinion of Lender be sufficient to pay in full the balance of the costs which
are reasonably estimated by the Casualty Consultant to be incurred in
connection with the completion of the Restoration, Borrower shall deposit the
deficiency (the “Net Proceeds Deficiency”) with Lender before any
further disbursement of the Net Proceeds shall be made.  The Net Proceeds Deficiency deposited with
Lender shall be held by Lender and shall
be disbursed for costs actually incurred in connection with the
Restoration on the same conditions applicable to the disbursement of the Net
Proceeds, and until so disbursed pursuant to this Section 5.3.2  shall constitute additional security for
the Debt.

 

(g)           The excess, if any,
of the Net Proceeds and the remaining balance, if any, of the Net Proceeds Deficiency deposited with Lender after the
Casualty Consultant certifies to 

 

69

 

Lender
that the Restoration has been completed in accordance with the provisions of
this Section 5.3.2, and the receipt by Lender of evidence
satisfactory to Lender that all costs incurred in connection with the
Restoration have been paid in full, shall be remitted by Lender to Borrower,
provided no Event of Default shall have occurred and shall be continuing under
any of the Loan Documents.

 

(h)           Subject to Borrower’s
rights pursuant to Section 2.4.2, all Net Proceeds not required (i) to
be made available for the Restoration or (ii) to be returned to Borrower
as excess Net Proceeds pursuant to Section 5.3.2(g) may be retained and applied by Lender
toward the payment of the Debt, whether or not then due and payable, in such
order, priority and proportions as Lender in its sole discretion shall deem
proper, or, at the discretion of Lender, the same may be paid, either in whole
or in part, to Borrower for such purposes as Lender shall designate.

 

(i)            Notwithstanding
anything to the contrary contained herein, from and after the occurrence of a
Casualty or Condemnation, if (1) any Lease of all or any portion of an
Individual Property covering at least 25% of the total square footage of such
Individual Property and/or any contract for services at an Individual Property
(a “Service Contract”) for which the payments thereunder constitute at
least 25% of the Gross Revenue generated by such Individual
Property requires Borrower to restore such Individual Property after such
Casualty or Condemnation, (2) no default (beyond any applicable notice
and/or grace periods) shall have occurred and be continuing under such Lease or
Service Contract and (3) no Event of Default shall have occurred and be
continuing, then Lender shall disburse the Net Proceeds or Award in accordance
with the disbursement provisions specified in Section 5.3.2(b)- (g) to
Borrower (without Borrower having to satisfy the conditions specified in Section 5.3.2(a))
to facilitate Borrower’s compliance therewith.

 

VI.                                RESERVE FUNDS

 

Section 6.1            Required
Repairs.

 

6.1.1            Required Repairs and
Deposit of Required Repair Funds.  Borrower shall perform the repairs and the remediations at
the Property, as more particularly set forth on Schedule II hereto (such repairs
and remediations hereinafter collectively referred to as “Required Repairs”).  Borrower shall complete the Required Repairs
at each Individual Property by the required deadline for each repair or
remediation as set forth on Schedule II, subject to Excusable
Delays.  In the event that any amounts
are required to be deposited pursuant to Section 11.29(i), such
amounts, together with interest earned thereon, shall be referred to as the “Required
Repair Funds”.

 

6.1.2            Release of Required
Repair Funds.  (a)  Lender shall direct Agent to disburse
Required Repair Funds only for Required Repairs.

 

(b)           Lender shall direct
Agent to disburse Required Repair Funds upon satisfaction by Borrower of each
of the following conditions: (i) Borrower shall submit a request for
payment to Lender at least ten (10) days prior to the date on which
Borrower requests such payment be made and specifies the Required Repairs to be
paid, (ii) on the date such request is 

 

70

 

received
by Lender and on the date such payment is
to be made, no Event of Default shall exist and remain uncured, (iii) Lender
shall have received a certificate from Borrower (A) stating that the items
to be funded by the requested disbursement are Required Repairs, (B) stating
that all Required Repairs at the Property to be funded by the requested
disbursement have been performed to date in a good and workmanlike manner and
in accordance with all applicable Legal Requirements, such certificate to be
accompanied by a copy of any license, permit or other approval required by any
Governmental Authority in connection with the Required Repairs, (C) identifying
each Person that supplied materials or labor in connection with the Required
Repairs to be funded by the requested disbursement, and (D) stating that
each such Person has been paid amounts then due or will be paid such amount
upon such disbursement, such certificate to be accompanied by lien waivers or
other evidence of payment reasonably satisfactory to Lender, (iv) at
Lender’s option, a title search for the Individual Property at which such
Required Repairs are being performed indicating that such Individual Property
is free from all Liens, claims and other encumbrances not previously approved
by Lender, (v) at Lender’s option, if the cost of any individual Required
Repair exceeds $750,000, Lender shall have received a report satisfactory to
Lender in its reasonable discretion from an architect, engineer or consultant
approved (which approval shall not be unreasonably withheld, conditioned or
delayed) by Lender in respect of such architect’s, engineer’s or consultant’s
inspection of the Required Repairs, and (vi) Lender shall have received
such other evidence as Lender shall reasonably request that the portion of the
Required Repairs to be funded by the requested disbursement have been performed
to date and are paid for or will be paid upon such disbursement to
Borrower.  Lender shall not be required
to disburse Required Repair Funds more frequently than once each calendar
month, unless such requested disbursement is in an amount greater than the
Minimum Disbursement Amount (or a lesser amount if the total amount of Required
Repair Funds is less than the Minimum Disbursement Amount, in which case only
one disbursement of the amount remaining in the account shall be made).

 

(c)           Nothing in this Section 6.1.2,
shall (i) make Lender responsible for performing or completing the
Required Repairs; (ii) require Lender to expend funds in addition to the
Required Repair Funds to complete any Required Repairs; (iii) obligate
Lender to proceed with the Required Repairs; or (iv) obligate Lender to
demand from Borrower additional sums to complete any Required Repairs.

 

(d)           Borrower shall
permit Lender and Lender’s agents and representatives (including, without
limitation, Lender’s engineer, architect, inspector or consultant) or third
parties to enter onto the Property during normal business hours (subject to the
rights of Tenants under their Leases) to inspect the progress of any Required
Repairs and all materials being used in connection therewith and to examine, if
applicable, all plans and shop drawings relating to such Required Repairs.  Prior to the occurrence of an Event of
Default such entry and inspection shall be conducted in a manner that minimizes
any interference with Borrower’s business or the use and enjoyment of the
Property by Borrower, Borrower’s tenants and Borrower’s tenants’ customers and
guests.  Borrower shall cause all
contractors and subcontractors to cooperate with Lender or Lender’s
representatives or such other Persons described above in connection with
inspections described in this Section 6.1.2(d).

 

(e)           If a disbursement
for any single Required Repair at an Individual Property will exceed $750,000,
Lender may require an inspection of the Property at Borrower’s expense 

 

71

 

prior
to making a disbursement of Required Repair Funds, and in connection therewith,
such entry and inspection shall be conducted in a manner that minimizes any
interference with Borrower’s business or the use and enjoyment of the Property
by Borrower, Borrower’s tenants and Borrower’s tenants’ customers and
guests.  Lender may require that such
inspection be conducted by an appropriate independent qualified professional
selected by Lender and may require a certificate of completion by an
independent qualified professional engineer, architect or consultant acceptable
to Lender prior to the disbursement of such Required Repair Funds.  Borrower shall pay the reasonable
out-of-pocket expense of the inspection as required hereunder, whether such
inspection is conducted by Lender or by an independent qualified professional
engineer, architect or consultant.

 

(f)            In the event Lender
releases an Individual Property (or assigns the Mortgage encumbering such
Individual Property) as a result of the exercise of Borrower’s rights under Section 2.4
or Section 2.5  hereof,
Lender shall direct Agent, and Agent shall, promptly following the release
of the Lien of the Mortgage (or the assignment of the Mortgage) with respect to
such Individual Property, deliver, or cause the delivery, to Borrower from the
Required Repair Funds an amount equal to the undisbursed portion of the
Required Repair Funds deposited by Borrower with respect to the Required
Repairs to be performed on such Individual Property.

 

Section 6.2            Tax
Funds.

 

6.2.1            Deposits of Tax Funds.  Pursuant to the Cash Management Agreement, upon the occurrence
of (a) a Trigger Event and during the continuance of a Trigger Period or (b) an
Event of Default and during the continuance thereof, there shall be deposited
with Agent on each Monthly Payment Date an amount equal to one-twelfth of the
Taxes that Lender reasonably estimates will be payable during the next ensuing
twelve (12) months in order to accumulate sufficient funds to pay all such
Taxes at least ten (10) days prior to their respective due dates. Amounts
deposited pursuant to this Section 6.2.1, together with interest
earned thereon, are referred to herein as the “Tax Funds”.  If at any time Lender reasonably determines
that the Tax Funds will not be sufficient to pay the Taxes, Lender shall notify
Borrower of such determination and the monthly deposits for Taxes shall be
increased by the amount that Lender estimates is sufficient to make up the
deficiency at least fifteen (15) days prior to the respective due dates for the
Taxes; provided that if Borrower receives notice of any deficiency after
the date that is fifteen (15) days prior to the date that Taxes are
due, Borrower will deposit such amount within three (3) Business Days after its receipt of such
notice.

 

6.2.2            Release of Tax Funds.  Lender shall have the right to apply the Tax Funds to
payment of Taxes (and, at Borrower’s request, which shall be made not later
than ten (10) days prior to the date the applicable payment of Taxes is
due, Lender shall apply the Tax Funds to such payment of Taxes, provided that
no Event of Default has occurred and is continuing).  In making any payment relating to Taxes,
Lender may do so according to any bill, statement or estimate procured from the
appropriate public office (with respect to Taxes) without inquiry into the
accuracy of such bill, statement or estimate or into the validity of any tax,
assessment, sale, forfeiture, tax lien or title or claim thereof.  If the amount of the Tax Funds shall exceed
the amounts due for Taxes, Lender shall, in its sole discretion, return any
excess to Borrower or credit such excess against future payments to be made to
the Tax Funds.  Any Tax 

 

72

 

Funds
remaining after the Debt has been paid in full shall be returned to
Borrower.  In the event Lender releases
an Individual Property (or assigns the Mortgage encumbering such Individual
Property) as a result of the exercise of Borrower’s rights under Section 2.4
or Section 2.5  hereof,
Lender shall direct Agent, and Agent shall, promptly following the release of
the Lien of the Mortgage (or the assignment of the Mortgage) with respect to
such Individual Property, deliver, or cause the delivery, to Borrower from the
Tax Funds an amount equal to the Tax Funds deposited by Borrower into the Tax
Account with respect to such Individual Property (to the extent such Tax Funds
are in excess of the Tax Funds that will be required to be reserved in the Tax Account with respect to the Property
(excluding such Individual Property)).

 

Section 6.3            Insurance
Funds.

 

6.3.1            Deposits of Insurance
Funds.  Pursuant to the Cash Management Agreement, upon
the occurrence of (a) a Trigger Event and during the continuance
of a Trigger Period or (b) an Event of Default and during the continuance
thereof, there shall be deposited with Agent on each Monthly Payment Date an
amount equal to one-twelfth of the Insurance Premiums that Lender
reasonably estimates will be payable for the renewal of the coverage afforded
by the Policies upon the expiration thereof in order to accumulate
sufficient funds to pay all such Insurance Premiums at least thirty (30) days
prior to the expiration of the Policies. Amounts deposited pursuant to this Section 6.3.1
are referred to herein as the “Insurance Funds”.  If at any time Lender reasonably determines
that the Insurance Funds will not be sufficient to pay the Insurance Premiums,
Lender shall notify Borrower of such determination and the monthly deposits for
Insurance Premiums shall be increased by the amount that Lender estimates is
sufficient to make up the deficiency at least thirty (30) days prior to
expiration of the Policies; provided that if Borrower receives notice of any
deficiency after the date that is thirty (30) days prior to the expiration date
of the Policies, Borrower will deposit such amount within three (3) Business
Days after its receipt of such notice. 
Notwithstanding the foregoing provisions of this Section 6.3.1,
if insurance coverages required hereunder are effected under one or more
blanket insurance Policies in accordance with the terms set forth in Section 5.1.1(c),
Borrower shall not be required to make deposits under this Section 6.3.1,
provided that Borrower delivers to Lender certificates of insurance
evidencing such blanket insurance Policies, together with evidence reasonably
satisfactory to Lender that the premiums for such blanket insurance Policies
have been paid, and if such Policies are to expire within thirty (30) days,
that the premiums with respect to such blanket Policies for the next succeeding
period have been paid.

 

6.3.2            Release of Insurance
Funds.  Lender shall have the right to apply the Insurance
Funds to payment of Insurance Premiums (and, at Borrower’s request, which shall
be made not later than ten (10) days prior to the date the applicable
payment of Insurance Premiums is due, Lender shall apply the Insurance Funds to
such payment of Insurance Premiums, provided that no Event of Default has
occurred and is continuing).  In making
any payment relating to Insurance Premiums, Lender may do so according to any
bill, statement or estimate procured from the insurer or its agent, without
inquiry into the accuracy of such bill, statement or estimate.  If the amount of the Insurance Funds shall
exceed the amounts due for Insurance Premiums, Lender shall, in its sole
discretion, return any excess to Borrower or credit such excess against future
payments to be made to the Insurance Funds. 
Any Insurance Funds remaining after the Debt has been paid in full shall
be returned to Borrower.  In the event
Lender releases an Individual Property (or assigns the Mortgage encumbering
such Individual Property) as a result 

 

73

 

of
the exercise of Borrower’s rights under Section 2.4 or Section 2.5
hereof, Lender shall direct Agent, and Agent shall, promptly following the
release of the Lien of the Mortgage (or the assignment of the Mortgage) with
respect to such Individual Property, deliver, or cause the delivery, to
Borrower from the Insurance Funds an amount equal to the Insurance Funds
deposited by Borrower into the Insurance Account with respect to such Individual
Property (to the extent such Insurance Funds are in excess of the Insurance
Funds that will be required to be reserved in the Insurance Account with
respect to the Property (excluding such Individual Property)).

 

Section 6.4            Capital
Expenditure Funds.

 

6.4.1            Deposits of Capital
Expenditure Funds. 
Pursuant to
the Cash Management Agreement, upon (a) the occurrence of a Trigger Event
and during the continuance of a Trigger Period or (b) the occurrence of an
Event of Default and during the continuance thereof, Borrower shall deposit
with Agent on each Monthly Payment Date an amount equal to the lesser of (a) one-twelfth
of the product of $0.03 and the number of cubic feet of space at the Property
(it being agreed that, as of the date hereof there is 40,256,700 cubic feet of space at the Property comprised of the
number of cubic feet at each Individual Property set forth on Schedule VI)
and (b) the amount necessary to bring the amount of Capital Expenditure
Funds in the Capital Expenditure Account to the Capital Expenditure Maximum
Amount, which amounts shall be for Capital Expenditures. Amounts deposited
pursuant to this Section 6.4.1, together with interest earned
thereon, are referred to herein as the “Capital Expenditure Funds”.

 

6.4.2            Release of Capital Expenditure
Funds.  (a)  Lender shall direct
Agent to disburse Capital Expenditure Funds only for Capital Expenditures Work.

 

(b)           Lender shall direct
Agent to disburse to Borrower the Capital Expenditure Funds upon satisfaction
by Borrower of each of the following conditions: (i) Borrower shall submit
a request for payment to Lender at least ten (10) days prior to the date
on which Borrower requests such payment be made and specifies the Capital
Expenditures Work to be paid, (ii) on the date such request is received by
Lender and on the date such payment is to be made, no Event of Default shall
exist and remain uncured, (iii) Lender shall have received a certificate
from Borrower (A) stating that the items to be funded by the requested
disbursement are Capital Expenditures Work, (B) stating that all Capital
Expenditures Work at the Property to be funded by the requested disbursement
have been performed to date in a good and workmanlike manner and in accordance
with all applicable Legal Requirements, such certificate to be accompanied by a
copy of any license, permit or other approval required by any Governmental
Authority in connection with the Capital Expenditures Work, (C) identifying
each Person that supplied materials or labor in connection with the Capital Expenditures
Work to be funded by the requested disbursement, and (D) stating that each
such Person has been paid amounts then due or will be paid such amount upon
such disbursement, such certificate to be accompanied by lien waivers or other
evidence of payment reasonably satisfactory to Lender, (iv) at Lender’s
option, a title search for the Individual Property at which such Capital
Expenditures Work are being performed indicating that such Individual Property
is free from all Liens, claims and other encumbrances not previously approved
by Lender, (v) intentionally omitted, and (vi) Lender shall have
received such other evidence as Lender shall reasonably request that the
portion of the Capital Expenditures Work at the Property to be funded by the
requested disbursement have been 

 

74

 

performed
to date and are paid for or will be paid upon such disbursement to
Borrower.  Lender shall not be required
to disburse Capital Expenditure Funds more frequently than once each calendar
month, unless such requested disbursement is in an amount greater than the
Minimum Disbursement Amount (or a lesser amount if the total amount of Capital
Expenditure Funds is less than the Minimum Disbursement Amount, in which case
only one disbursement of the amount remaining in the account shall be made).

 

(c)           Nothing in this Section 6.4.2
shall (i) make Lender responsible for making or completing the Capital
Expenditures Work; (ii) require Lender to expend funds in addition to the
Capital Expenditure Funds to complete any Capital Expenditures Work; (iii) obligate
Lender to proceed with the Capital Expenditures Work; or (iv) obligate Lender to demand from Borrower additional
sums to complete any Capital Expenditures Work.

 

(d)           Borrower shall
permit Lender and Lender’s agents and representatives (including, without
limitation, Lender’s engineer, architect, or inspector) or third parties to
enter onto the Property during normal business hours (subject to the rights of
Tenants under their Leases) to inspect the progress of any Capital Expenditures
Work and all materials being used in connection therewith and to examine (if
applicable) all plans and shop drawings relating to such Capital Expenditures
Work.  Prior to the occurrence of an
Event of Default, such entry and inspection shall be conducted in a manner that
minimizes any interference with Borrower’s business or the use and enjoyment of
the Property by Borrower, Borrower’s tenants and Borrower’s tenants’ customers
and guests.  Borrower shall cause all
contractors and subcontractors to cooperate with Lender or Lender’s
representatives or such other Persons described above in connection with
inspections described in this Section 6.4.2(d).

 

(e)           If a disbursement
with respect to any individual Property will exceed fifteen percent (15%) of
the Allocated Loan Amount for such Individual Property, Lender may require an
inspection of such Individual Property at Borrower’s expense prior to making a
disbursement of Capital Expenditure Funds in connection therewith. Such entry
and inspection shall be conducted in a manner that minimizes any interference
with Borrower’s business or the use and enjoyment of the affected Individual
Property by Borrower, Borrower’s tenants and Borrower’s tenants’ customers and
guests.  Lender may require that such
inspection be conducted by an appropriate independent qualified professional
selected by Lender and may require a certificate of completion by an
independent qualified professional architect, engineer or consultant reasonably
acceptable to Lender prior to the disbursement of such Capital Expenditure
Funds.  Borrower shall pay the reasonable
out-of-pocket expense of the inspection as required hereunder, whether such
inspection is conducted by Lender or by an independent qualified professional
architect, engineer or consultant.

 

(f)            In addition to any
insurance required under the Loan Documents, Borrower shall provide or cause to
be provided workmen’s compensation insurance, builder’s risk, and public
liability insurance and other insurance to the extent required under applicable
law in connection with Capital Expenditures Work.  All such policies shall be in form and amount
reasonably satisfactory to Lender.

 

(g)           In the event Lender
releases an Individual Property (or assigns the Mortgage encumbering such
Individual Property) as a result of the exercise of Borrower’s rights 

 

75

 

under
Section 2.4, Section 2.5 or Section 11.29
hereof, Lender shall direct Agent, and Agent shall, promptly following the
release of the Lien of the Mortgage (or the assignment of the Mortgage) with
respect to such Individual Property, deliver, or cause the delivery, to
Borrower from the Capital Expenditure Funds an amount equal to the Capital Expenditure
Funds on deposit which are in excess of the Capital Expenditure Maximum Amount
(as reduced due to such release), and the amount required to be deposited
pursuant to Section 6.4.1 shall be reduced proportionately to
reflect the reduced cubic footage of such released Individual Property.

 

Section 6.5            Borrower
Cash Collateral Funds.

 

6.5.1            Deposits of Borrower
Cash Collateral Funds.  From and after the occurrence of a Cash Trap
Event and during the continuance of a Cash Trap Period, Borrower shall deposit
with Agent all of the Borrower Excess Cash Flow (the “Borrower Cash
Collateral Funds”).

 

6.5.2            Release of Borrower Cash
Collateral Funds.  All Borrower Cash Collateral Funds on deposit shall be released by Lender
in accordance with the Cash Management Agreement when Lender determines that a
Cash Trap Period no longer exists.

 

Section 6.6            Intentionally
Omitted.

 

Section 6.7            Intentionally
Omitted.

 

Section 6.8            Application of Reserve
Funds.  Upon the occurrence and during the continuance of an Event
of Default, Lender, at its option, may withdraw the Reserve Funds and apply the
Reserve Funds to the items for which the Reserve Funds were established or to
payment of the Debt in such order, proportion and priority as Lender may
determine in its sole discretion.  Lender’s
right to withdraw and apply the Reserve Funds shall be in addition to all other
rights and remedies provided to Lender under the Loan Documents.

 

Section 6.9            Security
Interest in Reserve Funds.

 

6.9.1            Grant of Security
Interest.  Borrower shall be the owner of the funds on
deposit in the Accounts.  Borrower hereby
pledges, assigns and grants a security interest to Lender, as security for
payment of the Debt and the performance of all other terms, conditions and
covenants of the Loan Documents on Borrower’s part to be paid and performed, in
all of Borrower’s right, title and interest in and to the funds on deposit in
the Accounts.  The Reserve Funds shall be
under the sole dominion and control of Lender, and Lender shall hold the
Reserve Funds now or hereafter deposited in the Accounts subject to the terms
of this Agreement and the Cash Management Agreement.  Notwithstanding anything to the contrary
contained herein or in the Cash Management Agreement or any other Loan
Document, Lender shall have no
security interest or Lien in any funds disbursed to Borrower in accordance with
the Cash Management Agreement following such disbursement.

 

6.9.2            Income Taxes.  The Reserve Funds shall be held in an interest-bearing
account and invested in Permitted Investments in accordance with the terms of
the Cash Management Agreement.  Borrower
shall report on its federal, state and local income tax returns all interest or
income accrued on the Reserve Funds.

 

76

 

6.9.3            Prohibition Against
Further Encumbrance. 
Borrower shall
not, without the prior consent of Lender, further pledge, assign or grant any
security interest in the Reserve Funds or permit any lien or encumbrance to
attach thereto, or any levy to be made thereon, or any UCC-1 Financing
Statements, except those naming Lender as the secured party, to be filed with
respect thereto.

 

Section 6.10         Intentionally
Omitted.

 

Section 6.11         Provisions
Regarding Letters of Credit.

 

6.11.1         Security for Debt.  Each Letter of Credit delivered under this Agreement shall
be additional security for the payment of the Debt.  Upon the occurrence and during the
continuance of an Event of Default, Lender shall have the right, at its option,
to draw on any Letter of Credit and to apply all or any part thereof to the
payment of the items for which such Letter of Credit was established or to
apply each such Letter of Credit to payment of the Debt in such order,
proportion or priority as Lender may determine. 
Any such application to the Debt shall be subject to the terms set forth
in Section 2.3.3 and Section 2.4.3.  On the Maturity Date, any such Letter of
Credit may be applied to reduce the Debt.

 

6.11.2         Additional Rights of
Lender.  In addition to any other right Lender may
have to draw upon a Letter of Credit pursuant to the terms and conditions of
this Agreement, Lender shall have the additional rights to draw in full any
Letter of Credit: (a) with respect to any evergreen Letter of Credit, if
Lender has received a notice from the issuing bank that the Letter of Credit
will not be renewed and a substitute Letter of Credit is not provided at least
thirty (30) days prior to the date on which the outstanding Letter of Credit is
scheduled to expire; (b) with respect to any Letter of Credit with a
stated expiration date, if Lender has not received a notice from the issuing
bank that it has renewed the Letter of Credit at least thirty (30) days prior
to the date on which such Letter of Credit is scheduled to expire and a
substitute Letter of Credit is not provided at least thirty (30) days prior to
the date on which the outstanding Letter of Credit is scheduled to expire; (c) upon
receipt of notice from the issuing bank that the Letter of Credit will be
terminated (except if the termination of such Letter of Credit is permitted
pursuant to the terms and conditions of this Agreement or a substitute Letter
of Credit is provided); or (d) if Lender has received notice that the bank
issuing the Letter of Credit shall cease to be an Eligible Institution, and
Borrower shall have failed to provide a replacement Letter of Credit within
five (5) Business Days thereof. 
Notwithstanding anything to the contrary contained in the above, Lender
is not obligated to draw any Letter of Credit upon the happening of an event
specified in (a), (b), (c) or (d) above and shall not be liable for
any losses sustained by Borrower due to the insolvency of the bank issuing the
Letter of Credit if Lender has not drawn the Letter of Credit.  If any Letter of Credit proceeds shall be
disbursed to Lender hereunder, Borrower shall thereafter be permitted to
deliver to Lender, as a replacement for such cash proceeds, either a Letter of
Credit or Reserve Guaranty in the amount of the cash proceeds then remaining
after application in accordance with the terms hereof, and Lender shall
promptly disburse such remaining cash proceeds to Borrower upon its receipt of
such replacement Letter of Credit or Reserve Guaranty.

 

Section 6.12         Guaranty or Letter of
Credit in Lieu of Cash Deposit.  (a)  In lieu
of making cash deposits of Required Repair Funds, Tax Funds, Insurance Funds
and/or 

 

77

 

Capital
Expenditure Funds, Borrower may deliver to Lender one or more of the following:
(i) a guaranty from Guarantor in form and substance reasonably acceptable
to Lender (a “Reserve Guaranty”) or (ii) a Letter of Credit in
accordance with the provisions of this Section 6.12.  Borrower shall be responsible for the payment
of all reasonable out-of-pocket costs and expenses incurred by the Servicer in
the administration of any Letter of Credit or Reserve Guaranty delivered
pursuant to this Section 6.12.

 

(b)           In the event
Borrower elects to deliver a Letter of Credit in lieu of making cash deposits
of Required Repair Funds, Tax Funds, Insurance Funds and/or Capital Expenditure
Funds, the aggregate amount of any Letter of Credit, Reserve Guaranty and/or
cash on deposit with respect to the Required Repair Funds, Tax Funds, Insurance
Funds and/or Capital Expenditure Funds shall at all times be at least equal to the aggregate amount
which Borrower is required to have on deposit in such Reserve Fund(s) pursuant
to this Agreement.  The aggregate amount
of any Letter of Credit, Reserve Guaranty and/or cash on deposit with respect
to the Tax Funds shall at all times be at least equal to the aggregate which
Borrower would be required to deposit in such Reserve Fund over the next twelve
(12) month period.  The aggregate amount
of any Letter of Credit, Reserve Guaranty and/or cash on deposit with respect
to the Insurance Funds shall at all times be at least equal to the aggregate
which Borrower would be required to deposit in such Reserve Fund over the next
twelve (12) month period.  In the event
that a Letter of Credit and/or Reserve Guaranty is delivered in lieu of any
portion of the Tax Funds or the Insurance Funds, Borrower shall be responsible
for the payment of Taxes or Insurance Premiums, as applicable, and Lender shall
not be responsible therefor.

 

(c)           Borrower shall give
Lender no less than thirty (30) days notice of Borrower’s election to deliver a
Letter of Credit pursuant to this Section 6.12 and Borrower shall
pay to Lender all of Lender’s reasonable out-of-pocket costs and expenses in
connection therewith.  Borrower shall not
be entitled to draw from any such Letter of Credit.  Upon thirty (30) days notice to Lender,
Borrower may replace a Letter
of Credit theretofore delivered to Lender pursuant to this Section 6.12
with a cash deposit to the applicable Reserve Fund and/or with a Reserve Guaranty.  Prior to such replacement of a Letter
of Credit, to the extent same is not replaced with a Reserve Guaranty, Borrower
shall deposit an amount equal to the amount that would have accumulated in the
applicable Reserve Fund and not been disbursed in accordance with this
Agreement if such Letter of Credit had not been delivered.

 

(d)           Borrower shall
provide Lender with notice of any increases in the annual payments for Taxes
and Insurance Premiums thirty (30) days prior to the effective date of any such
increase and any applicable Letter of Credit under this Section 6.12
shall be increased by such increased amount at least ten (10) days prior
to the effective date of such increase (unless such increase is covered by cash
or a Reserve Guaranty).

 

VII.                            PROPERTY MANAGEMENT

 

Section 7.1            The Management Agreement.  Borrower shall cause any Manager to manage the Property in
accordance with the Management Agreement. 
Borrower shall (i) diligently perform and observe all of the material
terms, covenants and conditions of the Management Agreement on the part of
Borrower to be performed and observed, (ii) promptly notify Lender of any
notice to Borrower of any default by Borrower in the performance or 

 

78

 

observance
of any of the terms, covenants or conditions of the Management Agreement on the
part of Borrower to be performed and observed, and (iii) if Manager is not
an Affiliate of Borrower, promptly deliver to Lender a copy of each financial
statement, business plan, capital expenditures plan, report and estimate
received by it under the
Management Agreement.  If Borrower shall
default in the performance or observance of any material term, covenant or
condition of any Management Agreement on the part of Borrower to be performed
or observed, then, without limiting Lender’s other rights or remedies under
this Agreement or the other Loan Documents, and without waiving or releasing
Borrower from any of its obligations hereunder or under the Management
Agreement, Lender shall have the right, but shall be under no obligation, to
pay any sums and to perform any act as may be appropriate to cause all the
material terms, covenants and conditions of the Management Agreement on the
part of Borrower to be performed or observed.

 

Section 7.2            Prohibition Against
Termination or Modification.  Borrower shall not (i) surrender, terminate or cancel
any Management Agreement, unless (A) Borrower has advised Lender of its
intention to terminate the Manager, (B) the replacement manager has
delivered to Lender copies of an Assignment of Management Agreement and a cash
management agreement in substantially the form of the Cash Management Agreement
in each case executed by Borrower and replacement manager and (C) the
replacement manager is a Qualified Manager, (ii) modify any Management
Agreement in such a way that would have a material adverse effect on the use, operation or value
of the Property or the ability of Borrower to pay its obligations in respect of
the Loan, (iii) enter into any other agreement with any Person for such
Person to act as the manager or operator of the Property, except as provided in
this Section 7.2, or (iv) consent to the Transfer by the
Manager of its interest under the Management Agreement except as provided in
this Section 7.2, in each case without the express consent of
Lender, which consent shall not be unreasonably withheld; provided, however,
with respect to a new manager (other than a Qualified Manager), such consent
may be conditioned upon Borrower delivering a Rating Agency Confirmation as to
such new manager and management agreement. 
If at any time Lender consents to the appointment of a new manager, or a
new manager is appointed without Lender’s consent being required, (a) such
new manager and Borrower shall, as a condition of Lender’s consent, if
required, execute an Assignment of Management Agreement and a cash management
agreement in substantially the form of the Cash Management Agreement and (b) if
such new manager is an Affiliate of Borrower, Borrower shall deliver a
non-consolidation opinion acceptable to the Rating Agencies.

 

Section 7.3            Replacement of Manager.  Lender shall have the right to require Borrower to replace
any Manager with a Person which
is not an Affiliate of, but is chosen
by, Borrower and approved by Lender (which approval, in the case of a
replacement due to the circumstances described in subsections (ii) and/or (iii) of
this Section 7.3, shall not be unreasonably withheld, conditioned
or delayed) upon the occurrence of any one or more of the following events: (i) at
any time following the acceleration of the Loan by Lender, (ii) if Manager
shall be in material default
under the Management Agreement beyond any applicable notice and cure period
and/or (iii) if at any time the Manager has engaged in gross negligence,
fraud or willful misconduct.

 

Section 7.4            The Cash Management
Agency Agreement.  Lender shall have the right to require Borrower
to terminate the Cash Management Agency Agreement upon the 

 

79

 

occurrence
of any one or more of the following events: (i) at any time following the
acceleration of the Loan by Lender, (ii) if Borrower’s counterparty to the
Cash Management Agency Agreement shall be in material default thereunder beyond any applicable notice and
cure period and/or (iii) if at any time such counterparty has engaged in
gross negligence, fraud or willful misconduct.

 

VIII.                        PERMITTED TRANSFERS

 

Section 8.1            Permitted Transfer of
Property.  The Loan may not be assumed in connection
with a Transfer of the Property during the period commencing on the date hereof
and expiring on the first anniversary of the date hereof.  Thereafter, Lender’s consent to a Transfer of
the Property and assumption of the Loan, or to a Transfer of all of the interests in Borrower,
which Transfer is otherwise prohibited hereunder, shall not be unreasonably
withheld, provided that the following requirements are satisfied:

 

(a)           Lender receives
sixty (60) days prior written notice of such Transfer;

 

(b)           no Event of Default
has occurred and is continuing and no Default or Event of Default shall occur
as a result of such Transfer;

 

(c)           Borrower shall pay
Lender a transfer fee which is payable to the Servicer equal to $25,000 at the
time of such Transfer; provided that no transfer fee shall be payable to
the Lender or the Servicer for the first such Transfer;

 

(d)           Borrower shall pay
any and all reasonable out-of-pocket costs incurred in connection with such
Transfer (including, without limitation, Lender’s reasonable counsel fees and
disbursements and all recording fees, title insurance premiums and mortgage and
intangible taxes and the fees and expenses of the Rating Agencies pursuant to
clause (1) below);

 

(e)           Transferee shall be
a Qualified Transferee;

 

(f)            Transferee must
have demonstrated expertise in owning and operating properties similar in
location, size, class and operation to the Property, which expertise shall be
reasonably determined by Lender;

 

(g)           Intentionally omitted;

 

(h)           If the Property is
being transferred and the Loan assumed, Transferee shall assume all of the
obligations of Borrower under the Loan Documents in a manner satisfactory to
Lender in all respects, including, without limitation, by entering into an assumption
agreement in form and substance reasonably satisfactory to Lender;

 

(i)            Transferee and the
general partner of Transferee (if Transferee is a limited partnership) or
economic member of Transferee (if Transferee is a limited liability company)
must be able to satisfy all the representations and covenants set forth in Section 3.1.8
(with respect to ERISA), Section 3.1.9 (with respect to Prescribed
Laws), Sections 4.1.1 (with respect to Prescribed Laws) and Section 4.2.11
(with respect to ERISA) of this Agreement;

 

80

 

(j)            Transferee and the
general partner of Transferee (if Transferee is a limited partnership) or
economic member of Transferee (if Transferee is a limited liability company)
shall deliver all organizational documentation reasonably requested by Lender,
which shall be reasonably satisfactory to Lender;

 

(k)           Borrower shall have
delivered a Rating Agency Confirmation with respect to Transferee and the
Transfer;

 

(l)            Borrower or
Transferee, at its sole cost and expense, shall deliver to Lender a bankruptcy
nonconsolidation opinion letter reflecting such Transfer reasonably
satisfactory in form and substance to Lender and acceptable to the Rating
Agencies;

 

(m)          (i) in the event
Guarantor has executed and delivered any guaranty in connection with the Loan,
prior to any release of Guarantor from its liabilities and obligations
thereunder, one (1) or more substitute guarantors reasonably acceptable to
Lender and acceptable to the Rating Agencies (A) shall have assumed all of
the liabilities and obligations of Guarantor under such guaranties or (B) shall
execute and deliver a replacement guaranty reasonably satisfactory to Lender
and acceptable to the Rating Agencies and (ii) prior to any release of
Guarantor from its liabilities and obligations under the Environmental
Indemnity, one (1) or more substitute indemnitors reasonably acceptable to
Lender and acceptable to the Rating Agencies (A) shall have assumed all of the liabilities and obligations
of Guarantor under the Environmental Indemnity or (B) shall execute and
deliver a replacement environmental indemnity reasonably satisfactory to Lender
and acceptable to the Rating Agencies;

 

(n)           Borrower shall
deliver, at its sole cost and expense, an endorsement to the Title Insurance
Policies, insuring the Mortgage, as modified by the assumption agreement, as a
valid first lien on the Property and naming the Transferee as owner of the
Property, which endorsement shall insure that, as of the date of the recording
of the assumption agreement, the Property shall not be subject to any
additional exceptions or liens other than those contained in the relevant Title
Insurance Policy issued on the date hereof and the Permitted Encumbrances
relating thereto; and

 

(o)           each individual
Property shall be managed by a Qualified Manager pursuant to a replacement
management agreement reasonably satisfactory to Lender.

 

The
consent of the Lender to a Transfer may be conditioned on, among other things,
whether or not the Transferee, the controlling principals of Transferee and all other entities which may be owned
or controlled directly or indirectly by Transferee’s controlling principals
(such principal and other entities, collectively, the “Related Persons”)
are Disqualified Transferees as of the date of the Transfer (unless, with
respect to any entity, the controlling principals of Transferee did not own or
control such entity at the time there occurred with respect to such entity the
event giving rise to it being regarded as a Disqualified Transferee).

 

Immediately
upon a Transfer to such Transferee and the satisfaction of all of the above
requirements, the named Borrower and Guarantor herein shall be released from
all liability under this Agreement, the Note, the Mortgage and the other Loan
Documents accruing after such 

 

81

 

Transfer.  The foregoing release shall be effective upon
the date of such Transfer, but Lender agrees to provide written evidence
thereof reasonably requested by Borrower.

 

Notwithstanding
the foregoing, nothing contained in this Agreement or the other Loan Documents
shall in any way restrict or prohibit, nor shall any notice to Lender or
consent of Lender be required in connection with, a Transfer effectuated in
compliance with the terms and provisions of clause (A) or clause (B) contained
in the last sentence of Section 8.2.

 

Section 8.2            Permitted Transfers of
Interest in Borrower.  A Transfer of (but not a mortgage, pledge,
hypothecation, encumbrance or grant of a security interest in) a direct or
indirect beneficial interest in Borrower or any SPC Party of Borrower shall be
permitted without Lender’s consent if (a) Lender receives thirty (30) days
prior written notice (or such shorter period of time as may be permitted by
Lender in its sole discretion) thereof and, to the extent required to permit
compliance by Borrower’s affiliates with Regulation FD, agrees to regard and
keep the same as Confidential, (b) Transferee and its Related Persons must
not be Disqualified Transferees as of the date of the Transfer; provided,
however, that in the event that the Transferee or any of its Related
Persons is a Disqualified Transferee, Lender shall not unreasonably withhold
its consent, and may consider such fact in making its determination, but such
fact shall not constitute the sole factor or reason for withholding its
consent, (c) immediately prior to such Transfer, no Event of Default shall
have occurred and be continuing (other than an Event of Default which would be
cured by such Transfer), (d) subsequent to such Transfer, Borrower and
each SPC Party continue to satisfy the conditions of Section 3.1.24,
(e) subsequent to such Transfer, Guarantor owns directly or indirectly
more than fifty percent (50%) of Borrower and each SPC Party and
controls Borrower and each SPC Party, and (f) if (i) such Transfer
causes Transferee to own, in the aggregate with the ownership interests of its
Affiliates, more than a 49% interest in Borrower or any SPC Party (and
Transferee together with its Affiliates did not, prior to such Transfer, own
more than a 49% interest in Borrower or such SPC Party), or (ii) such
Transfer, together with all other
Transfers of direct or indirect interest in Borrower or any SPC Party, whether
in a single Transfer or in a series of Transfers and whether or not effected
simultaneously, results in a transfer of more than 49% of the aggregate
ownership interests in Borrower or any SPC Party, an acceptable
non-consolidation opinion is delivered to Lender and to each of the Rating
Agencies concerning, as applicable, Borrower, each SPC Party, Transferee and/or
their respective owners.  Notwithstanding
the foregoing, nothing contained in this Agreement or the other Loan Documents shall
in any way restrict or prohibit, nor shall any notice to Lender or consent of
Lender or Rating Agency Confirmation (except as expressly provided below) be
required in connection with (A) the transfer, mortgage, pledge,
hypothecation, encumbrance or issuance of any ownership interests or securities
in VNO, VRLP, CEI, CRE, YAA, YAP or YCI or any Public Company (or of any
Persons owning an interest in any of the foregoing), (B) the merger or
consolidation of VNO, VRLP, CEI, CRE, YAA, YAP or YCI or any Public Company
with or into any other Person (or of any Persons owning an interest in any of
the foregoing), or a sale or transfer of all or substantially all of the assets
of VNO, VRLP, CEI, CRE, YAA, YAP or YCI or of any Public Company (or of any
Persons owning an interest in any of the foregoing), (C) the transfer,
mortgage, pledge, hypothecation or encumbrance of any ownership interests or
securities in Guarantor between or among VNO, VRLP, CEI, CRE, YAA, YAP and YCI
(or one or more entities owned and controlled by any one or more of the foregoing),
(D) the issuance of any ownership interests or securities in Guarantor so
long as Guarantor (or its permitted successor) or its direct or indirect owner
is or, in 

 

82

 

connection
with such issuance, becomes, a Public Company, and (E) the merger or
consolidation of Guarantor or its direct or indirect owner with or into any
other Person, provided that the surviving entity of such merger or
consolidation or its direct or indirect owner is a Public Company; provided
further that, if, after giving effect to any transaction described under clause
(D) or (E), VNO, VRLP, CEI, CRE, YAA, YAP and/or YCI would own in the
aggregate, directly or indirectly, less than fifty-one percent (51%) interest
of Borrower or any SPC Party or would not control Borrower and each SPC Party,
Borrower shall have obtained a Rating Agency Confirmation.

 

IX.                                SALE AND SECURITIZATION OF
MORTGAGE

 

Section 9.1            Sale of Mortgage and
Securitization; Loan Components; Mezzanine Loans.  (a) 
Subject to the limitations in Section 11.27, Lender shall have the
right (i) to sell or otherwise transfer the Loan or any portion thereof as
a whole loan, (ii) to sell participation interests in the Loan or (iii) to securitize the Loan or any portion thereof in a single-asset
securitization or a pooled-loan securitization. 
The transactions referred to in clauses (i), (ii) and (iii) shall
hereinafter be referred to collectively as “Secondary Market Transactions”
and the transactions referred to in clause (iii) shall hereinafter be
referred to as a “Securitization”. 
Any certificates, notes or other securities issued in connection with a
Securitization are hereinafter referred to as “Securities”.

 

(b)           If requested by
Lender, Borrower shall use reasonable efforts to assist Lender in satisfying
the market standards to which Lender customarily adheres or which may be
reasonably required in the marketplace or by the Rating Agencies in connection
with any Secondary Market Transactions, including, without limitation, to:

 

(i)            (A) provide updated financial
and other information with respect to the Property, the business operated at
the Property, Borrower and the Manager, (B) provide updated budgets
relating to the Property and (C) provide updated appraisals, market studies,
environmental reviews (Phase I’s and, if appropriate, Phase II’s), property condition reports and
other due diligence investigations of the Property (the “Updated Information”),
together, if customary, with appropriate verification of the Updated Information
through letters of auditors or opinions of counsel reasonably acceptable to
Lender and acceptable to the Rating Agencies;

 

(ii)           provide opinions of counsel, which
may be relied upon by Lender, the Rating Agencies and their respective counsel,
agents and representatives, as to non-consolidation, fraudulent conveyance, and
true sale or any other opinion customary in Secondary Market Transactions or
required by the Rating Agencies with respect to the Property and Borrower and
Affiliates, which counsel and opinions shall be reasonably satisfactory to
Lender and satisfactory to the Rating Agencies;

 

(iii)          provide updated, as of the closing
date of the Secondary Market Transaction if such closing date is more than six (6) months
after the date hereof, representations and warranties made in the Loan
Documents and such additional representations and warranties as the Rating
Agencies may reasonably require, in each 

 

83

 

case, with such
modifications as are necessary to make such representations and warranties true
in all material respects; and

 

(iv)          execute amendments to the Loan
Documents and Borrower’s organizational documents reasonably requested by
Lender; provided, however, that Borrower shall not be required to
modify or amend (A) any Loan Document if such modification or amendment
would change the interest rate, the stated maturity or the amortization of
principal as set forth herein or in the Note, or (B) any Loan Document or
organizational document of Borrower if in the reasonable judgment of Borrower
the same would modify or amend any other material economic
term of the Loan,
increase Borrower’s obligations or liabilities thereunder in any material
respect, adversely effect any right of Borrower under the Loan
Documents in any material respect or have a material adverse effect on the
manner in which Borrower operates its business.

 

(c)           Borrower covenants
and agrees that, upon Lender’s request, Borrower shall deliver
one or more new component notes to replace the original note or modify the
original note to reflect multiple components of the Loan or create one or more
new mezzanine loans (including amending Borrower’s organizational structure to
provide for one or more new mezzanine borrowers) (each a “Resizing Event”).  Lender agrees that such new notes, modified
notes or mezzanine notes shall immediately after the
Resizing Event have
the same initial weighted average interest rate as the original note
immediately prior to such Resizing Event. Such new notes, modified notes or
mezzanine notes may allocate principal and interest rates of the Loan between
or among such new components and/or mezzanine loans in a manner specified by
Lender in its sole discretion; provided that, unless an Event of Default
has occurred and is then continuing, all prepayments with respect to such new notes or
modified note or mezzanine notes shall be applied on a pro rata basis.  In connection with any Resizing Event,
Borrower covenants and agrees to modify and amend the Cash Management
Agreement, and execute amendments to the Loan Documents and Borrower’s
organizational documents reasonably requested by Lender; provided, however,
that Borrower shall not be required to modify or amend any Loan Document or
organizational document of Borrower if in the reasonable judgment of Borrower
the same would increase Borrower’s monetary obligations, modify or amend any
other material economic term of the Loan, increase Borrower’s other obligations
or liabilities thereunder in any material respect, adversely affect any right
of Borrower, under the Loan Documents in any material respect or have a
material adverse effect on the manner in which Borrower operates its business.

 

(d)           Notwithstanding
anything herein or in any other Loan Document to the contrary, (i) all
reasonable out-of-pocket costs and expenses (other than the first $14,485 of
legal fees) actually incurred by Borrower or its Affiliates in connection with
Borrower’s complying with requests made under this Section 9.1
shall be paid by Lender and (ii) Lender shall pay all other costs and
expenses incurred by any other parties in connection with any action
contemplated by this Section 9.1.

 

(e)           Nothing contained in
this Agreement or in the other Loan Documents shall restrict Lender from
requesting that Borrower deliver to Lender information regarding tenants or
customers at the Property and the impact such tenants or customers have or may
have on the Gross Revenue of the Property; provided, however,
that Borrower shall not be required to deliver 

 

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specific
information concerning the specific pricing structure applicable to any tenant
or customer.

 

Section 9.2            Securitization
Indemnification.  (a)  Borrower understands
that information provided to Lender by Borrower and its agents, counsel and
representatives may be included in disclosure documents in connection with the
Securitization, including, without limitation, an offering circular, a
prospectus, prospectus supplement, private placement memorandum or other
offering document (each, an “Disclosure Document”) and may also be
included in filings with the Securities and Exchange Commission pursuant to the
Securities Act of 1933, as amended (the “Securities Act”), or the
Securities and Exchange Act of 1934, as amended (the “Exchange Act”),
and may be made available to investors or prospective investors in the
Securities, the Rating Agencies, and service providers relating to the
Securitization.

 

(b)           Borrower shall
provide in connection with each of (i) a preliminary and a final private
placement memorandum or (ii) a preliminary and final prospectus or
prospectus supplement, as applicable, an agreement (the entering into of which
shall be at no cost to Borrower) (A) certifying that Borrower has examined
those portions of such Disclosure Documents specified by Lender for Borrower’s
review pertaining to Borrower, Borrower’s Affiliates, Manager or the Loan and
that each such Disclosure Document, as it relates to sections of the Disclosure
Documents specified with reasonable specificity by Lender relating to Borrower,
Borrower’s Affiliates, the Property, Manager and any material aspects of the
Loan, does not (except to the extent specified by Borrower if Borrower does not
agree with the statements therein) contain any untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements
made, in the light of the circumstances under which they were made, not
misleading, (B) indemnifying Lender (and for purposes of this Section 9.2,
Lender hereunder shall include its officers and directors), the Affiliate of
Lender that has filed the registration statement relating to the Securitization
(the “Registration Statement”), each of its directors, each of its
officers who have signed the Registration Statement and each Person that
controls the Affiliate within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act (collectively, the “Lender Group”),
and Lender, and any other placement agent or underwriter with respect to the
Securitization, each of their respective directors and each Person who controls
Lender or any other placement agent or underwriter within the meaning of Section 15
of the Securities Act and Section 20 of the Exchange Act (collectively,
the “Underwriter Group”) for any losses, claims, damages or liabilities,
including reasonable attorneys’ fees and disbursements, other than those
arising out of the gross negligence, willful misconduct or bad faith of any of
the foregoing proposed indemnitees (collectively, the “Liabilities”) to
which Lender, the Lender Group or the Underwriter Group may become subject
insofar as the Liabilities arise out of or are based upon any untrue statement
of any material fact contained in such sections or arise out of or are based
upon the omission to state therein a material fact required to be stated in
such sections or necessary in order to make the statements in such sections, in
light of the circumstances under which they were made, not misleading (except
that (x) Borrower’s obligation to indemnify in respect of any information
contained in such sections that is derived in part from information provided by
Borrower and in part from information provided by others unrelated to or not
employed by Borrower shall be limited to any untrue statement or omission of
material fact therein known to Borrower that results from an error in any
information provided (or which should have been provided) by Borrower which
Borrower has been given the opportunity to examine and reasonably and promptly
approve (Borrower 

 

85

 

hereby
confirms that it has reviewed and approved each of the appraisals, engineering,
environmental and asbestos reports prepared by third parties in connection with
the Loan) and (y) Borrower shall have no responsibility for the failure of
any member of the Underwriting Group to accurately transcribe written
information supplied by Borrower or the refusal of any member of the
Underwriting Group to include any written information supplied by Borrower
after an explicit direction from Borrower to do so) and (C) agreeing to
reimburse Lender, the Lender Group and/or the Underwriter Group for any legal
or other expenses reasonably incurred by Lender, the Lender Group and the
Underwriter Group in connection with investigating or defending the Liabilities
to the extent that such legal or other expenses are incurred in connection with
matters for which Borrower has agreed to indemnify the Underwriter Group
herein; provided, however, that Borrower will be liable in any
such case under clauses (B) or (C) above only to the extent that any
such loss, claim, damage or liability arises out of or is based upon any such
untrue statement or omission made therein in reliance upon and in conformity
with information furnished to Lender by or on behalf of Borrower in connection
with the preparation of the Disclosure Document or in connection with the
underwriting or closing of the Loan, including, without limitation, financial
statements of Borrower, operating statements and major customer lists with
respect to the Property and not subsequently retracted or modified in whole or
in part so as to eliminate the misstatement or omission in question prior to
any Securitization.  This indemnity agreement
will be in addition to any liability which Borrower may otherwise have.

 

(c)           Intentionally
Omitted.

 

(d)           Promptly after
receipt by an indemnified party under this Section 9.2 of notice of
the commencement of any action, such indemnified party will, if a claim in
respect thereof is to be made against the indemnifying party under this Section 9.2,
notify the indemnifying party in writing of the commencement thereof, but the
omission to so notify the indemnifying party will not relieve the indemnifying
party from any liability which the indemnifying party may have to any
indemnified party hereunder except to the extent that failure to notify causes
prejudice to the indemnifying party.  In
the event that any action is brought against any indemnified party, and it
notifies the indemnifying party of the commencement thereof, the indemnifying
party will be entitled, jointly with any other indemnifying party, to
participate therein and, to the extent that it (or they) may elect by written notice delivered to the
indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof with counsel reasonably
satisfactory to such indemnified party. 
After notice from the indemnifying party to such indemnified party under
this Section 9.2, such indemnified party shall pay for any legal or
other expenses subsequently incurred by such indemnified party in connection
with the defense thereof other than reasonable costs of investigation; provided,
however, if the defendants in any such action include both the
indemnified party and the indemnifying party and the indemnified
party shall have reasonably concluded that there are any legal defenses
available to it and/or other indemnified parties that are different from or additional
to those available to the indemnifying party, the indemnified party or parties
shall have the right to select separate counsel to assert such legal defenses
and to otherwise participate in the defense of such action on behalf of such
indemnified party at the cost of the indemnifying party.  The indemnifying party shall not be liable
for the expenses of more than one separate counsel unless an indemnified party
shall have reasonably concluded that there

 

86

 

may
be legal defenses available to it that are different from or additional to
those available to another indemnified party.

 

(e)           In order to provide
for just and equitable contribution in circumstances in which the indemnity
agreement provided for in Section 9.2(b) is for any reason
held to be unenforceable as to an indemnified party in respect of any losses,
claims, damages or liabilities (or action in respect thereof) referred to
therein which would otherwise be indemnifiable under Section 9.2(b),
the indemnifying party shall contribute to the amount paid or payable by the
indemnified party as a result of such losses, claims, damages or liabilities
(or action in respect thereof); provided, however, that no Person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall
be entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation.  In
addition, no right of contribution may be enforced by any party who shall have
committed gross negligence or willful misconduct in connection with the actions
or omissions that led to such liability against any party who was not guilty of
such gross negligence or willful misconduct in connection with the actions or
omissions that led to such liability.  In
determining the amount of contribution to which the respective parties are
entitled, the following factors shall be considered: (i) the applicable
Lender’s and Borrower’s relative knowledge and access to information concerning
the matter with respect to which the claim was asserted; (ii) the
opportunity to correct and prevent any statement or omission; (iii) the
responsibilities and obligations of Borrower specified herein; and (iv) any
other equitable considerations appropriate in the circumstances.  Lender and Borrower hereby agree that it
would not be equitable if the amount of such contribution were determined by
pro rata or per capita allocation.

 

(f)            The liabilities and
obligations of both Borrower and Lender under this Section 9.2 shall
survive the termination of this Agreement and the satisfaction and discharge of
the Debt.

 

X.                                    DEFAULTS

 

Section 10.1         Event of Default.  (a)  Each of the following events shall constitute an
event of default hereunder (an “Event of Default”):

 

(i)            if (A) the payment due on the
Maturity Date is not paid when due, (B) if any monthly installment of
interest due under the Note (other than the payment due on the Maturity Date)
is not paid on or prior to the applicable Monthly Payment Date; provided
that it shall not be an Event of Default if a monthly installment of interest
is not paid when due if there are sufficient sums on deposit in the Debt
Service Account (as defined in the Cash Management Agreement) for payment of
such amounts and Lender’s access to such funds has not been inhibited or
prevented in any manner whatsoever due to circumstances or events which are
directly or indirectly caused by or otherwise relate to any actions or
omissions of Borrower or any of its Affiliates, or (C) any other portion
of the Debt is not paid when due and such non-payment continues for five (5) days following notice to
Borrower that the same is due and payable;

 

(ii)           if any of the Taxes or Other Charges
are not paid when due, provided that it shall not be an Event of Default
if Taxes are not paid when due if there are sufficient

 

87

 

sums on deposit in the
Tax Account (as defined in the Cash Management Agreement) for payment of such
amounts and Lender’s access to such funds has not been inhibited or prevented
in any manner whatsoever due to circumstances or events which are directly or
indirectly caused by or otherwise relate to any actions or omissions of
Borrower or any of its Affiliates;

 

(iii)          if the Policies are not kept in full
force and effect;

 

(iv)          if Borrower breaches or permits or
suffers a breach of Section 4.2.1;

 

(v)           if any representation or warranty
made by Borrower herein or in any other Loan Document, or in any material
report, certificate, financial statement or other instrument, agreement or
document furnished to Lender shall have been false or misleading in any
material respect as of the date the representation or warranty was made and,
with respect to any such breach which is not the subject of any other subsection
of this Section 10.1(a) and which is capable of being cured,
Borrower fails to remedy such condition within ten (10) days following
notice to Borrower from Lender, in the case of any such breach which can be
cured by the payment of a sum of money, or within thirty (30) days following
notice from Lender in the case of any other such breach; provided, however,
that if such non-monetary breach is susceptible of cure but cannot reasonably
be cured within such 30-day period and provided further that Borrower shall
have commenced to cure such breach within such 30-day period and thereafter
diligently and expeditiously proceeds to cure the same, such 30-day period
shall be extended for such time as is reasonably necessary for Borrower in the
exercise of due diligence to cure such breach, such additional period not to
exceed sixty (60) days plus time permitted for Excusable Delays;

 

(vi)          if Borrower, any SPC Party or
Guarantor shall make an assignment for the benefit of creditors;

 

(vii)         if a receiver, liquidator or trustee
shall be appointed for Borrower, any SPC Party or Guarantor or if Borrower, any
SPC Party or Guarantor shall be adjudicated a bankrupt or insolvent, or if any petition for bankruptcy,
reorganization or arrangement pursuant to federal bankruptcy law, or any
similar federal or state law, shall be filed by or against, consented to, or
acquiesced in by, Borrower, any SPC Party or Guarantor, or if any proceeding
for the dissolution or liquidation of Borrower, any SPC Party or Guarantor
shall be instituted; provided, however, if such appointment,
adjudication, petition or proceeding was involuntary and not consented to by
Borrower, any SPC Party or Guarantor, upon the same not being discharged,
stayed or dismissed within ninety (90) days;

 

(viii)        if Borrower attempts to assign its
rights under this Agreement or any of the other Loan Documents or any interest
herein or therein in contravention of the Loan Documents;

 

(ix)           if any of the assumptions contained
in (A) the Insolvency Opinion, (B) any other non-consolidation
opinion delivered to Lender in connection with the Loan or

 

88

 

(C) any other non-consolidation opinion delivered
subsequent to the closing of the Loan is or shall become untrue in any material
respect;

 

(x)            if Borrower breaches in any material
respect any representation, warranty or covenant contained in Section 3.1.24
hereof;

 

(xi)           if Borrower breaches any of the
negative covenants contained in Section 4.2.12 hereof;

 

(xii)          intentionally omitted;

 

(xiii)         intentionally omitted;

 

(xiv)        if Guarantor breaches in any material
respect any covenant, warranty or representation contained in any guaranty
executed and delivered by Guarantor in connection with the Loan and such breach
is not cured to Lender’s satisfaction within fifteen (15) days of
notice to Guarantor from Lender;

 

(xv)         intentionally omitted;

 

(xvi)        if at any time
during the term of
the Loan an Alteration Guaranty is delivered pursuant to the terms of this
Agreement and the guarantor thereunder (other than Guarantor) fails to maintain
an Investment Grade Rating (a “Downgrade Event”) and Borrower fails to
deliver (A) a replacement Alteration Guaranty in an amount equal to the
amount of the “Guaranteed Obligations” under such Alteration Guaranty from
Guarantor or a guarantor with an Investment Grade Rating or (B) Alteration
Security within ten (10) Business Days of the occurrence of the applicable
Downgrade Event;

 

(xvii)       intentionally omitted;

 

(xviii)      if Borrower shall continue to be in
Default under any of the other terms, covenants or conditions of this Agreement
or any other Loan Document not specified in subsections (i) to (xvii)
above, for ten (10) days after notice to Borrower from Lender, in the case
of any Default which can be cured by the payment of a sum of money, or for
thirty (30) days after notice from Lender in the case of any other Default; provided,
however, that if such non-monetary Default is susceptible of cure but
cannot reasonably be cured within such 30-day period and provided further that
Borrower shall have commenced to cure such Default within such 30-day period
and thereafter diligently and expeditiously proceeds to cure the same, such
30-day period shall be extended for such time as is reasonably necessary for Borrower
in the exercise of due diligence
to cure such Default, such additional period not to exceed sixty (60) days plus
time permitted for Excusable Delays; or

 

(xix)         if any other such event shall occur or
condition shall exist, if the effect of such event or condition is to
accelerate the maturity of any portion of the Debt or to permit Lender to
accelerate the maturity of all or any portion of the Debt.

 

89

 

(b)           Upon the occurrence
of an Event of Default (other than an Event of Default described in clauses
(vi), (vii) or (viii) above) and at any time thereafter Lender may,
in addition to any other rights or remedies available to it pursuant to this
Agreement and the other Loan Documents or at law or in equity, take such
action, without notice or demand, that Lender deems advisable to protect and
enforce its rights against Borrower and in and to the Property, including,
without limitation, declaring the Debt to be immediately due and payable, and
Lender may enforce or avail itself of any or all rights or remedies provided in
the Loan Documents against Borrower and the Property, including, without
limitation, all rights or remedies available at law or in equity; and upon any
Event of Default described in clauses (vi), (vii) or (viii) above,
the Debt and all other obligations of Borrower hereunder and under the other
Loan Documents shall immediately and automatically become due and payable,
without notice or demand, and Borrower hereby expressly waives any such notice
or demand, anything contained herein or in any other Loan Document to the
contrary notwithstanding.

 

Section 10.2         Remedies.  (a)  Upon the occurrence and during the continuance of an
Event of Default, all or any one or more of the rights, powers, privileges and
other remedies available to Lender against Borrower under this Agreement or any
of the other Loan Documents executed and delivered by, or applicable to,
Borrower or at law or in equity may be exercised by Lender at any time and from
time to time, whether or not all or any of the Debt shall be declared due and
payable, and whether or not Lender shall have commenced any foreclosure
proceeding or other action for the enforcement of its rights and remedies under
any of the Loan Documents with respect to the Property.  Any such actions taken by Lender shall be
cumulative and concurrent and may be pursued independently, singly,
successively, together or otherwise, at such time and in such order as Lender
may determine in its sole discretion, to the fullest extent permitted by law,
without impairing or otherwise affecting the other rights and remedies of
Lender permitted by law, equity or contract or as set forth herein or in the
other Loan Documents.  Without limiting
the generality of the foregoing, if an Event of Default is continuing (i) Lender
is not subject to any “one action” or “election of remedies” law or rule, and (ii) all
liens and other rights, remedies or privileges provided to Lender shall remain
in full force and effect until Lender has exhausted all of its remedies against
the Property and the Mortgage has been foreclosed, sold and/or otherwise
realized upon in satisfaction of the Debt or the Debt has been paid in full.

 

(b)           Upon the occurrence
and during the continuance of an Event of Default, Lender shall have the right from time to time
to partially foreclose the
Mortgage in any manner and for any amounts secured by the Mortgage then due and
payable as determined by Lender in its sole discretion including, without
limitation, the following circumstances: (i) in the event Borrower
defaults beyond any applicable grace period in the payment of one or more scheduled payments of principal and
interest, Lender may foreclose the Mortgage to recover such delinquent
payments, or (ii) in the event Lender elects to accelerate less than the
entire outstanding principal balance of the Loan, Lender may foreclose the
Mortgage to recover so much of the principal balance of the Loan as Lender may
accelerate and such other sums secured by the Mortgage as Lender may
elect.  Notwithstanding one or more
partial foreclosures, the Property shall remain subject to the Mortgage to
secure payment of sums secured by the Mortgage and not previously recovered.

 

90

 

(c)           Lender shall have
the right from time to time to sever the Note and the other Loan Documents into
one or more separate notes, mortgages and other security documents (the “Severed
Loan Documents”) in such denominations as Lender shall determine in its
sole discretion for purposes of evidencing and enforcing its rights and
remedies provided hereunder.  Borrower
shall execute and deliver to Lender from time to time, promptly after the
request of Lender, a severance agreement and such other documents as Lender shall
request in order to effect the severance described in the preceding sentence,
all in form and substance reasonably satisfactory to Lender.  Borrower hereby absolutely and irrevocably
appoints Lender as its true and lawful attorney, coupled with an interest, in
its name and stead to make and execute all documents necessary or desirable to
effect the aforesaid severance, Borrower ratifying all that its said attorney
shall do by virtue thereof; provided, however, Lender shall not
make or execute any such documents under such power until three (3) days
after notice has been given to Borrower by Lender of Lender’s intent to
exercise its rights under such power. 
Borrower shall not be obligated to pay any costs or expenses incurred in
connection with the preparation, execution, recording or filing of the Severed
Loan Documents.  The Severed Loan
Documents shall contain only provisions which are substantially similar to
those contained in the Loan Documents (except to reflect reductions in
principal) and which do not have any material adverse effect on Borrower’s
rights or obligations thereunder in any material respect or increase Borrower’s
monetary obligations thereunder in any material respect or the operation of its
business and any representations and warranties contained in the Severed Loan
Documents will be given by Borrower only as of the date hereof.

 

(d)           Any amounts
recovered from the Property or any other collateral for the Loan after an Event
of Default may be applied by Lender toward the payment of any interest and/or
principal of the Loan and/or any other amounts due under the Loan Documents in
such order, priority and proportions as Lender in its sole discretion shall
determine; provided, however, that Borrower shall not be liable
for the misapplication of any amounts recovered and applied by Lender in its
sole discretion.

 

Section 10.3         Right to Cure Defaults.  Upon the occurrence and during the continuance of an Event
of Default, Lender may, but without any obligation to do so and without notice
to or demand on Borrower and without releasing Borrower from any obligation
hereunder or being deemed to have cured any Event of Default hereunder, make,
do or perform any obligation of Borrower hereunder in such manner and to such
extent as Lender may deem necessary in respect of such Event of Default.  Lender is authorized to enter upon the
Property for such purposes, or appear in, defend, or bring any action or
proceeding to protect its interest in the Property for such purposes, and the
cost and expense thereof (including reasonable attorneys’ fees to the extent
permitted by law), with interest as provided in this Section 10.3,
shall constitute a portion of the Debt and shall be due and payable to Lender
upon demand.  All such costs and expenses
incurred by Lender in remedying such Event of Default or such failed payment or
act or in appearing in, defending, or bringing any action or proceeding shall
bear interest at the Default Rate, for the period after such cost or expense
was incurred into the date of payment to Lender.  All such costs and expenses incurred by
Lender together with interest thereon calculated at the Default Rate shall be
deemed to constitute a portion of the Debt and be secured by the liens, claims
and security interests provided to Lender under the Loan Documents and shall be
immediately due and payable upon demand by Lender therefore.

 

91

 

Section 10.4         Remedies Cumulative.  The rights, powers and remedies of Lender under this
Agreement shall be cumulative and not exclusive of any other right, power or
remedy which Lender may have against Borrower pursuant to this Agreement or the
other Loan Documents, or existing at law or in equity or otherwise.  Lender’s rights, powers and remedies may be
pursued singly, concurrently or otherwise, at such time and in such order as
Lender may determine in Lender’s sole discretion.  No delay or omission to exercise any remedy,
right or power accruing upon an Event of Default shall impair any such remedy,
right or power or shall be construed as a waiver thereof, but any such remedy,
right or power may be exercised from time to time and as often as may be deemed
expedient. 
A waiver of
one Default or Event of Default with respect to Borrower shall not be construed
to be a waiver of any subsequent Default or Event of Default by
Borrower or to impair any remedy, right or power consequent
thereon.

 

XI.                                MISCELLANEOUS

 

Section 11.1         Successors and Assigns.  All covenants, promises and agreements in this Agreement
shall inure to the benefit of the legal representatives, successors and assigns
of the parties hereto.

 

Section 11.2         Lender’s Discretion.  Whenever pursuant to this Agreement Lender exercises any
right given to it to approve or disapprove, or any arrangement or term is to be
satisfactory to Lender, the decision of Lender to approve or disapprove or to
decide whether arrangements or terms are satisfactory or not satisfactory shall
(except as is otherwise specifically herein provided) be in the sole discretion
of Lender (which discretion shall be exercised in good faith) and shall be
final and conclusive.  Prior to a
Securitization, whenever pursuant to this Agreement the Rating Agencies are
given any right to approve or disapprove, or any arrangement or term is to be
satisfactory to the Rating Agencies, the decision of Lender to approve or
disapprove or to decide whether arrangements or terms are satisfactory or not
satisfactory, based upon Lender’s determination of Rating Agency criteria,
shall be substituted therefore.

 

Section 11.3         Governing
Law.  (A) THIS AGREEMENT
WAS NEGOTIATED IN THE STATE OF NEW YORK, THE LOAN WAS MADE BY LENDER AND
ACCEPTED BY BORROWER IN THE STATE OF NEW YORK, AND THE PROCEEDS OF THE LOAN
DELIVERED PURSUANT HERETO WERE DISBURSED FROM THE STATE OF NEW YORK, WHICH
STATE THE PARTIES AGREE HAS A SUBSTANTIAL RELATIONSHIP TO THE
PARTIES AND TO THE UNDERLYING TRANSACTION EMBODIED HEREBY, AND IN ALL RESPECTS,
INCLUDING, WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS AGREEMENT, THE NOTE AND THE OTHER
LOAN DOCUMENTS AND THE OBLIGATIONS ARISING HEREUNDER AND THEREUNDER SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH STATE (WITHOUT REGARD
TO PRINCIPLES OF CONFLICT OF LAWS) AND ANY APPLICABLE LAW OF THE UNITED STATES
OF AMERICA, EXCEPT THAT AT ALL TIMES THE PROVISIONS FOR THE CREATION,
PERFECTION, AND ENFORCEMENT OF THE LIEN AND SECURITY INTEREST CREATED

 

92

 

PURSUANT HERETO AND PURSUANT TO THE OTHER LOAN
DOCUMENTS (OTHER THAN WITH RESPECT TO LIENS AND SECURITY INTERESTS IN PROPERTY
WHOSE PERFECTION AND PRIORITY IS COVERED BY ARTICLE 9 OF THE UCC (EXCLUDING
FIXTURES AND INCLUDING, WITHOUT LIMITATION, THE ACCOUNTS) WHICH SHALL BE
GOVERNED BY THE LAW OF THE JURISDICTION APPLICABLE THERETO IN ACCORDANCE WITH
SECTIONS 9-301 THROUGH 9-307 OF THE UCC AS IN EFFECT IN THE STATE OF NEW YORK)
SHALL BE GOVERNED BY AND CONSTRUED ACCORDING TO THE LAW OF THE STATE IN WHICH
THE PROPERTY IS LOCATED, IT BEING UNDERSTOOD THAT, TO THE FULLEST EXTENT
PERMITTED BY THE LAW OF SUCH STATE, THE LAW OF THE STATE OF NEW YORK SHALL
GOVERN THE CONSTRUCTION, VALIDITY AND ENFORCEABILITY OF ALL LOAN DOCUMENTS AND
ALL OF THE OBLIGATIONS ARISING HEREUNDER OR THEREUNDER.  TO THE FULLEST EXTENT PERMITTED BY LAW,
BORROWER AND LENDER HEREBY UNCONDITIONALLY AND IRREVOCABLY WAIVE ANY CLAIM TO
ASSERT THAT THE LAW OF ANY OTHER JURISDICTION GOVERNS THIS AGREEMENT, THE NOTE
AND THE OTHER LOAN DOCUMENTS, AND THIS AGREEMENT, THE NOTE AND THE OTHER LOAN
DOCUMENTS SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK PURSUANT TO SECTION 5-1401 OF THE NEW YORK GENERAL
OBLIGATIONS LAW EXCEPT AS SPECIFICALLY SET FORTH ABOVE.

 

(B)           ANY LEGAL SUIT, ACTION OR
PROCEEDING AGAINST LENDER OR BORROWER ARISING OUT OF OR RELATING TO THIS
AGREEMENT MAY BE INSTITUTED IN ANY FEDERAL OR STATE COURT IN THE CITY OF NEW
YORK, COUNTY OF NEW YORK, PURSUANT TO SECTION 5-1402 OF THE NEW YORK
GENERAL OBLIGATIONS LAW AND LENDER AND BORROWER EACH WAIVES ANY OBJECTIONS
WHICH IT MAY NOW OR HEREAFTER HAVE BASED ON VENUE AND/OR FORUM NON
CONVENIENS OF ANY SUCH SUIT, ACTION OR PROCEEDING, AND BORROWER AND LENDER HEREBY IRREVOCABLY
SUBMIT TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUIT, ACTION OR PROCEEDING.
BORROWER DOES HEREBY DESIGNATE AND APPOINT:

 

CT CORPORATION

111 EIGHTH AVENUE, 13TH FLOOR

NEW YORK, NEW YORK 10011

 

AS ITS AUTHORIZED AGENT TO ACCEPT AND ACKNOWLEDGE ON ITS BEHALF SERVICE
OF ANY AND ALL PROCESS WHICH MAY BE SERVED IN ANY SUCH SUIT, ACTION OR
PROCEEDING IN ANY FEDERAL OR STATE COURT IN NEW YORK, NEW YORK, AND AGREES THAT
SERVICE OF PROCESS UPON SAID AGENT AT SAID ADDRESS AND WRITTEN NOTICE OF SAID
SERVICE MAILED OR DELIVERED TO BORROWER IN THE MANNER PROVIDED HEREIN SHALL BE
DEEMED IN EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON BORROWER, IN ANY SUCH
SUIT, ACTION OR PROCEEDING IN THE STATE OF NEW YORK. BORROWER (I) SHALL
GIVE PROMPT NOTICE TO LENDER OF ANY

 

93

 

CHANGED ADDRESS OF ITS AUTHORIZED AGENT HEREUNDER, (II) MAY AT
ANY TIME AND FROM TIME TO TIME DESIGNATE A SUBSTITUTE AUTHORIZED AGENT WITH AN
OFFICE IN NEW YORK, NEW YORK (WHICH SUBSTITUTE AGENT AND OFFICE SHALL BE
DESIGNATED AS THE PERSON AND ADDRESS FOR SERVICE OF PROCESS), AND (III) SHALL
PROMPTLY DESIGNATE SUCH A SUBSTITUTE IF ITS AUTHORIZED AGENT CEASES TO HAVE AN
OFFICE IN NEW YORK, NEW YORK OR IS DISSOLVED WITHOUT LEAVING A SUCCESSOR.

 

Section 11.4         Modification, Waiver in
Writing.  No modification, amendment, extension, discharge,
termination or waiver of any provision of this Agreement or of any other Loan
Document, nor consent to any departure by Borrower therefrom, shall in any event
be effective unless the same shall be in a writing signed by the party against
whom enforcement is sought, and then such waiver or consent shall be effective
only in the specific instance, and for the purpose, for which given.  Except as otherwise expressly provided
herein, no notice to, or demand on Borrower, shall entitle Borrower to any
other or future notice or demand in the same, similar or other circumstances.

 

Section 11.5         Delay Not a Waiver.  Neither any failure nor any delay on the part of Lender in
insisting upon strict performance of any term, condition, covenant or
agreement, or exercising any right, power, remedy or privilege hereunder, or
under any other Loan Document, shall operate as or constitute a waiver thereof,
nor shall a single or partial exercise thereof preclude any other future
exercise, or the exercise of any other right, power, remedy or privilege.  In particular, and not by way of limitation,
by accepting payment after the due date of any amount payable under this
Agreement or any other Loan Document, Lender shall not be deemed to have waived
any right either to require prompt payment when due of all other amounts due
under this Agreement or the other Loan Documents, or to declare a default for
failure to effect prompt payment of any such other amount.  Lender shall have the right to waive or
reduce any time periods that Lender is entitled to under the Loan Documents in
its sole and absolute discretion.

 

Section 11.6         Notices.  All notices, demands, requests, consents, approvals or other
communications (any of the foregoing, a “Notice”) required, permitted,
or desired to be given hereunder shall be in writing  sent by telefax (with answer back
acknowledged) or by registered or certified mail, postage prepaid, return
receipt requested, or delivered by hand or reputable overnight courier
addressed to the party to be so notified at its address hereinafter set forth,
or to such other address as such party may hereafter specify in accordance with
the provisions of this Section 11.6.  Any Notice shall be deemed to have been
received: (a) three (3) days after the date such Notice is mailed, (b) on
the date of sending by telefax if sent during business hours on a Business Day
(otherwise on the next Business Day), (c) on the date of delivery by hand
if delivered during business hours on a Business Day (otherwise on the next
Business Day), and (d) on the next Business Day if sent by an overnight
commercial courier, in each case addressed to the parties as follows:

 

	
  If
  to Lender:

  	
  UBS
  Real Estate Securities Inc.

  
	
   

  	
  1285
  Avenue of the Americas

  
	
   

  	
  New
  York, New York 10019

  

 

94

 

	
   

  	
  Attention:
  Jeffrey N. Lavine

  
	
   

  	
  Facsimile
  No.: (212) 713-4062

  
	
   

  	
   

  
	
  with a copy to:

  	
  Cadwalader, Wickersham & Taft LLP

  
	
   

  	
  One World Financial Center

  
	
   

  	
  New York, New York 10281

  
	
   

  	
  Attention: Steven M. Herman, Esq.

  
	
   

  	
  Facsimile No.: (212) 504-6666

  
	
   

  	
   

  
	
  If to Borrower:

  	
  c/o AmeriCold Logistics, LLC

  
	
   

  	
  10 Glenlake Parkway, Suite 800

  
	
   

  	
  Atlanta, Georgia 30328

  
	
   

  	
  Attention: Chief Financial Officer

  
	
   

  	
  Facsimile No: (678) 441-6852

  
	
   

  	
   

  
	
  with a copy to:

  	
  c/o Crescent Real Estate Equities

  
	
   

  	
  777 Main Street, Suite 2100

  
	
   

  	
  Fort Worth, Texas 76102

  
	
   

  	
  Attention: David Dean, Executive Vice President - Law

  
	
   

  	
  Facsimile No.: (817) 321-2929

  
	
   

  	
   

  
	
  with a copy to:

  	
  c/o Yucaipa American Alliance Fund I, LP

  
	
   

  	
  9130 West Sunset Boulevard

  
	
   

  	
  Los Angeles, California 90069

  
	
   

  	
  Attention: Legal Department

  
	
   

  	
  Facsimile No.: (310) 789-1791

  
	
   

  	
   

  
	
  with a copy to:

  	
  c/o Yucaipa Corporate Initiatives Fund I, LP

  
	
   

  	
  9130 West Sunset Boulevard

  
	
   

  	
  Los Angeles, California 90069

  
	
   

  	
  Attention: Legal Department

  
	
   

  	
  Facsimile No.: (310) 789-1791

  
	
   

  	
   

  
	
  with a copy to:

  	
  c/o Vornado Realty Trust

  
	
   

  	
  888 Seventh Avenue

  
	
   

  	
  New York, New York 10019

  
	
   

  	
  Attention: Chief Financial Officer

  
	
   

  	
  Facsimile No.: (201) 843-2198

  
	
   

  	
   

  
	
  with a copy to:

  	
  Sullivan & Cromwell LLP

  
	
   

  	
  125 Broad Street

  
	
   

  	
  New York, New York 10004

  
	
   

  	
  Attention: Arthur S. Adler, Esq.

  
	
   

  	
  Facsimile No.: (212)
  558-3588

  

 

Section 11.7         Trial
by Jury.  BORROWER AND LENDER EACH
HEREBY AGREES NOT TO ELECT A TRIAL BY JURY OF ANY ISSUE TRIABLE OF RIGHT BY
JURY, AND WAIVES ANY RIGHT TO TRIAL BY JURY FULLY TO THE

 

95

 

EXTENT THAT ANY SUCH RIGHT SHALL NOW OR HEREAFTER
EXIST WITH REGARD TO THE LOAN DOCUMENTS, OR ANY CLAIM, COUNTERCLAIM OR OTHER
ACTION ARISING IN CONNECTION THEREWITH. THIS WAIVER OF RIGHT TO TRIAL BY JURY
IS GIVEN ]KNOWINGLY AND VOLUNTARILY BY BORROWER AND LENDER, AND IS INTENDED TO
ENCOMPASS INDIVIDUALLY EACH INSTANCE AND EACH ISSUE AS TO WHICH THE RIGHT TO A
TRIAL BY JURY WOULD OTHERWISE ACCRUE. 
EACH PARTY IS HEREBY AUTHORIZED TO FILE A COPY OF THIS PARAGRAPH IN ANY
PROCEEDING AS CONCLUSIVE EVIDENCE OF THIS WAIVER.

 

Section 11.8         Headings.  The Article and/or Section headings and the
Table of Contents in this Agreement are included herein for convenience of
reference only and shall not constitute a part of this Agreement for any other
purpose.

 

Section 11.9         Severability.  Wherever possible, each provision of this Agreement shall
be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Agreement shall be prohibited by or invalid
under applicable law, such provision shall be ineffective to the extent of such
prohibition or invalidity, without invalidating the remainder of such provision
or the remaining provisions of this Agreement.

 

Section 11.10       Preferences.  Lender shall have the continuing and exclusive right to
apply or reverse and reapply any and all payments by Borrower to any portion of
the obligations of Borrower hereunder. 
To the extent Borrower makes a payment or payments to Lender, which
payment or proceeds or any part thereof are subsequently invalidated, declared
to be fraudulent or preferential, set aside or required to be repaid to a
trustee, receiver or any other party under any bankruptcy law, state or federal
law, common law or equitable cause, then, to the extent of such payment or proceeds received,
the obligations hereunder or part thereof intended to be satisfied shall be revived and continue in full force and
effect, as if such payment or proceeds had not been received by Lender.

 

Section 11.11       Waiver of Notice.  Borrower shall not be entitled to any notices
of any nature whatsoever from Lender except with respect to matters for which
this Agreement or the other Loan Documents specifically and expressly provide
for the giving of notice by Lender to Borrower and except with respect to
matters for which Borrower is not, pursuant to applicable Legal Requirements,
permitted to waive the giving of notice. 
Borrower hereby expressly waives the right to receive any notice from
Lender with respect to any matter for which this Agreement or the other Loan
Documents do not specifically and expressly provide for the giving of notice by
Lender to Borrower.

 

Section 11.12       Remedies of Borrower.  In the event that a claim or adjudication is made that
Lender or its agents have acted unreasonably or unreasonably delayed acting in
any case where, by law or under this Agreement or the other Loan Documents,
Lender or such agent, as the case may be, has an obligation to act reasonably
or promptly, neither Lender nor its agents shall be liable for any monetary
damages, and Borrower’s sole remedy shall be limited to commencing an action
seeking injunctive relief or declaratory judgment.  Any action or proceeding to determine whether
Lender has acted reasonably shall be determined by an action seeking
declaratory judgment.

 

96

 

Section 11.13       Expenses; Indemnity.  (a) 
Borrower shall pay or, if Borrower fails to pay, reimburse Lender upon receipt
of notice from Lender, for all reasonable and customary out-of-pocket costs and
expenses (including reasonable attorneys’ fees and disbursements) incurred by
Lender in connection with (i) Borrower’s ongoing performance of and
compliance with Borrower’s agreements and covenants contained in this Agreement
and the other Loan Documents on its part to be performed or complied with after
the date hereof; including, without limitation, confirming compliance with
environmental and insurance requirements; (ii) Lender’s ongoing
performance of and compliance with all agreements and covenants contained in
this Agreement and the other Loan Documents on its part to be performed or
complied with after the date hereof; (iii) the negotiation, preparation,
execution, delivery and administration of any consents, amendments, waivers or
other modifications to this Agreement and the other Loan Documents and any
other documents or matters requested by Borrower; (iv) the filing and
recording fees and expenses, title insurance and reasonable fees and expenses
of counsel for providing to Lender all required legal opinions, and other
similar expenses incurred, in creating and perfecting the Liens in favor of
Lender pursuant to this Agreement and the other Loan Documents; (v) enforcing
or preserving any rights, in response to third party claims or the prosecuting
or defending of any action or proceeding or other litigation or otherwise upon
the occurrence and during the continuance of an Event of Default, in each case
against, under or affecting Borrower, this Agreement, the other Loan Documents,
the Property, or any other security given for the Loan; and (vi) enforcing
any obligations of or collecting any payments due from Borrower under this
Agreement, the other Loan Documents or with respect to the Property or in
connection with any refinancing or restructuring of the credit arrangements
provided under this Agreement in the nature of a “work-out” or of any
insolvency or bankruptcy proceedings; provided, however, that
Borrower shall not be liable for the payment of any such costs and expenses to
the extent the same arise by reason of the gross negligence, illegal acts, bad
faith, fraud  or willful misconduct of
Lender.  Any costs due and payable to
Lender which are not paid by Borrower within ten (10) days after written
demand therefore may be paid to Lender pursuant to the Cash Management
Agreement.

 

(b)           Borrower shall indemnify,
defend and hold harmless Lender and its officers, directors, agents, employees
(and the successors and assigns of the foregoing) (the “Lender Indemnitees”)
from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, claims, costs, expenses and disbursements
of any kind or nature whatsoever (including, without limitation, the reasonable
fees and disbursements of counsel for the Lender Indemnitees in connection with
any investigative, administrative or judicial proceeding commenced or
threatened, whether or not the Lender Indemnitees shall be designated a party
thereto), that may be imposed on, incurred by, or asserted against the Lender
Indemnitees in any manner relating to or arising out of (i) any breach by
Borrower of its obligations under, or any material misrepresentation by
Borrower contained in, this Agreement or the other Loan Documents, or (ii) the
use or intended use of the proceeds of the Loan (collectively, the “Indemnified
Liabilities”); provided, however, that Borrower shall not
have any obligation to the Lender Indemnitees hereunder to the extent that such
Indemnified Liabilities arise from the gross negligence, illegal acts, bad
faith, fraud or willful misconduct of the Lender Indemnitees.  To the extent that the undertaking to
indemnify, defend and hold harmless set forth in the preceding sentence may be
unenforceable because it violates any law or public policy, Borrower shall pay
the maximum portion that it is permitted to pay and satisfy under applicable 

 

97

 

law to the payment
and satisfaction of all Indemnified Liabilities incurred by any Lender
Indemnitees.

 

Section 11.14       Schedules Incorporated.  The Schedules annexed hereto are hereby incorporated
herein as a part of this Agreement with the same effect as if set forth in the
body hereof.

 

Section 11.15       Offsets, Counterclaims
and Defenses.  Any assignee of Lender’s interest in and to
this Agreement and the other Loan Documents shall take the same free and clear
of all offsets, counterclaims or defenses which are unrelated to such documents
which Borrower may otherwise have against any assignor of such documents, and
no such unrelated counterclaim or defense shall be interposed or asserted by
Borrower in any action or proceeding brought by any such assignee upon such
documents and any such right to interpose or assert any such unrelated offset,
counterclaim or defense in any such action or proceeding is hereby expressly
waived by Borrower.

 

Section 11.16       No Joint Venture or
Partnership; No Third Party Beneficiaries.  (a) 
Borrower and Lender intend that the relationships created hereunder and under
the other Loan Documents be solely that of borrower and lender.  Nothing herein or therein is intended to
create a joint venture, partnership, tenancy-in-common, or joint tenancy
relationship between Borrower and Lender nor to grant Lender any interest in
the Property other than that of mortgagee, beneficiary or lender.

 

(b)           This Agreement and
the other Loan Documents are solely for the benefit of Lender and nothing
contained in this Agreement or the other Loan Documents shall be deemed to
confer upon anyone other than Lender any right to insist upon or to enforce the
performance or observance of any of the obligations contained herein or
therein.  All conditions to the
obligations of Lender to make the Loan hereunder are imposed solely and
exclusively for the benefit of Lender and no other Person shall have standing
to require satisfaction of such conditions in accordance with their terms or be
entitled to assume that Lender will refuse to make the Loan in the absence of
strict compliance with any or all thereof and no other Person shall under any
circumstances be deemed to be a beneficiary of such conditions, any or all of
which may be freely waived in whole or in part by Lender if, in Lender’s sole
discretion, Lender deems it advisable or desirable to do so.

 

Section 11.17       Publicity.  All news releases, publicity or advertising (other than any
of the foregoing effectuated in
connection with a Securitization of all or any portion of the Loan by Lender)
by each of Lender or Borrower or their Affiliates through any media intended to
reach the general public which refers to the Loan Documents or the financing
evidenced by the Loan Documents, to Lender, Borrower or any of their Affiliates
shall be subject to the prior approval of Lender and (except in connection with
a Securitization of all or any portion of the Loan) Borrower (except that no
Lender approval shall be required for Borrower’s or its Affiliate’s press
release, if any, in connection with the execution and delivery of this
Agreement), which approval, in any case, shall not be unreasonably withheld,
conditioned or delayed.

 

98

 

Section 11.18       Waiver of Marshalling of
Assets.  To the fullest extent permitted by law, Borrower, for
itself and its successors and assigns, waives all rights to a marshalling of
the assets of Borrower, Borrower’s partners and others with interests in
Borrower, and of the Property, and shall not assert any right under any laws
pertaining to the marshalling of assets, the sale in inverse order of
alienation, homestead exemption, the administration of estates of decedents, or
any other matters whatsoever to defeat, reduce or affect the right of Lender
under the Loan Documents to a sale of the Property for the collection of the
Debt without any prior or different resort for collection or of the right of
Lender to the payment of the Debt out of the net proceeds of the Property in
preference to every other claimant whatsoever.

 

Section 11.19       Waiver of
Offsets/Defenses/Counterclaims.  Borrower hereby waives the right to assert a counterclaim,
other than a compulsory counterclaim, in any action or proceeding brought
against it by Lender or its agents or otherwise to offset any obligations to
make the payments required by the Loan Documents.  No failure by Lender to perform any of its
obligations hereunder shall be a valid defense to, or result in any offset
against, any payments which Borrower is obligated to make under any of the Loan
Documents.

 

Section 11.20       Conflict; Construction
of Documents; Reliance.  In the event of any conflict between the
provisions of this Agreement and any of the other Loan Documents, the
provisions of this Agreement shall control. 
The parties hereto acknowledge that they were represented by competent
counsel in connection with the negotiation, drafting and execution of the Loan
Documents and that such Loan Documents shall not be subject to the principle of
construing their meaning against the party which drafted same.  Borrower acknowledges that, with respect to
the Loan, Borrower shall rely solely on its own judgment and advisors in
entering into the Loan without relying in any manner on any statements,
representations or recommendations of Lender or any parent, subsidiary or
Affiliate of Lender.  Lender shall not be
subject to any limitation whatsoever in the exercise of any rights or remedies
available to it under any of the Loan Documents or any other agreements or
instruments which govern the Loan by virtue of the ownership by it or any
parent, subsidiary or Affiliate of Lender of any equity interest any of them
may acquire in Borrower, and Borrower hereby irrevocably waives the right to
raise any defense or take any action on the basis of the foregoing with respect
to Lender’s exercise of any such rights or remedies.  Borrower acknowledges that Lender engages in
the business of real estate financings and other real estate transactions and
investments which may be viewed as adverse to or competitive with the business
of Borrower or its Affiliates.

 

Section 11.21       Brokers and Financial
Advisors.  Borrower and Lender each hereby represent that
it has not dealt independently of the other with any financial advisors,
brokers, underwriters, placement agents, agents or finders in connection with
the transactions contemplated by this Agreement.  Each party shall indemnify, defend and hold
the other party harmless from and against any and all claims, liabilities,
costs and expenses of any kind (including reasonable attorneys’ fees and
expenses) in any way relating to or arising from a claim by any Person that
such Person acted on behalf of such party in connection with the transactions
contemplated herein.  The provisions of
this Section 11.21 shall survive the expiration and termination of
this Agreement and the payment of the Debt.

 

Section 11.22       Exculpation.  Subject to the qualifications below, Lender shall not enforce
the liability and obligation of Borrower to perform and observe the obligations
contained 

 

99

 

in the Note, this
Agreement, the Mortgage or the other Loan Documents by any action or proceeding
wherein a money judgment shall be sought against Borrower, except that Lender
may bring a foreclosure action, an action for specific performance or any other
appropriate action or proceeding to
enable Lender to
enforce and realize upon its interest under the Note, this Agreement, the Mortgage
and the other Loan Documents, or in the Property, the Rents, or any other collateral
given to Lender pursuant to the Loan Documents; provided, however,
that, except as specifically provided herein, any judgment in any such action
or proceeding shall be enforceable against Borrower only to the extent of
Borrower’s interest in the Property, in the Rents and in any other collateral
given to Lender, and Lender, by accepting the Note, this Agreement, the
Mortgage and the other Loan Documents, shall not sue for, seek or demand any
deficiency judgment against Borrower in any such action or proceeding under or
by reason of or under or in connection with the Note, this Agreement, the
Mortgage or the other Loan Documents. 
The provisions of this Section shall not, however, (a) constitute
a waiver, release or impairment of any obligation evidenced or secured by any
of the Loan Documents; (b) impair the right of Lender to name Borrower as
a party defendant in any action or suit for foreclosure and sale under the
Mortgage; (c) affect the validity or enforceability of any guaranty made
in connection with the Loan or any of the rights and remedies of Lender
thereunder; (d) impair the right of Lender to obtain the appointment of a
receiver; (e) impair the enforcement of the Assignment of Leases; (f) constitute
a prohibition against Lender to seek a deficiency judgment against Borrower in
order to fully realize on any security given by Borrower in connection with the
Loan or to commence any other appropriate action or proceeding in order for
Lender to exercise its remedies against such security which, in any event,
shall only be enforced against such security; or (g) constitute a waiver
of the right of Lender to enforce the liability and obligation of Borrower, by
money judgment or otherwise, to the extent of any loss, damage, cost, expense,
liability, claim or other obligation incurred by Lender (including attorneys’
fees and costs reasonably incurred) arising out of or in connection with any of
the following:

 

(i)            fraud or intentional
misrepresentation by Borrower or any guarantor in connection with the Loan;

 

(ii)           the gross negligence or willful misconduct of Borrower;

 

(iii)          the breach of any representation, warranty, covenant or
indemnification provision in the Environmental Indemnity or in the Mortgage concerning
environmental laws, hazardous substances and asbestos and any indemnification
of Lender with respect thereto in either document;

 

(iv)          the removal or disposal of any portion of the Property after an
Event of Default other than in accordance with the terms of the Loan Documents (including, without limitation, the
Cash Management Agreement);

 

(v)           the misapplication or conversion by Borrower of (A) any
insurance proceeds paid by reason of any loss, damage or destruction to the Property, (B) any Awards
or other amounts received in connection with the Condemnation of all or a
portion of the Property, or (C) any Rents following an Event of Default;

 

100

 

(vi)          any security deposits, advance
deposits or any other deposits collected with respect to the Property which are
not delivered to Lender upon a foreclosure of the Property or action in lieu
thereof, except to the extent any such security deposits were applied in
accordance with the terms and conditions of any of the Leases prior to the
occurrence of the Event of Default that gave rise to such foreclosure or action
in lieu thereof;

 

(vii)         Borrower’s indemnification of Lender
set forth in Section 9.2 hereof;

 

(viii)        intentionally omitted; and

 

(ix)           intentionally omitted.

 

Notwithstanding anything to
the contrary in this Agreement, the Note or any of the Loan Documents, (A) Lender
shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the
Bankruptcy Code to file a claim for the full amount of the Debt or to require
that all collateral shall
continue to secure all of the Debt owing to Lender in accordance with the Loan
Documents, and (B) the Debt shall be fully recourse to Borrower in the
event that: (i) Borrower fails to obtain Lender’s prior consent to any
subordinate financing or other voluntary Lien encumbering the Property; (ii) Borrower
fails to obtain Lender’s prior consent to any assignment, transfer, or
conveyance of the Property or any interest therein as required by the Mortgage
or this Agreement; (iii) Borrower files a voluntary petition under the
Bankruptcy Code or any other Federal or state bankruptcy or insolvency law; (iv) an
Affiliate, officer, director, trustee, or representative which controls,
directly or indirectly, Borrower files, or joins in the filing of, an
involuntary petition against Borrower under the Bankruptcy Code or any other
Federal or state bankruptcy or insolvency law, or solicits or causes to be
solicited petitioning creditors for any involuntary petition against Borrower
from any Person; (v) intentionally omitted; (vi) Borrower files an
answer consenting to or otherwise acquiescing in or joining in any involuntary
petition filed against it, by any other Person under the Bankruptcy Code or any
other Federal or state bankruptcy or insolvency law, or solicits or causes to
be solicited petitioning creditors for any involuntary petition from any Person;
(vii) any Affiliate, officer, director, trustee, or representative which
controls Borrower consents to or acquiesces in or joins in an application for
the appointment of a custodian, receiver, trustee, or examiner for Borrower or
any portion of the Property; (viii) Borrower makes an assignment for the
benefit of creditors, or admits, in writing or in any legal proceeding, its
insolvency or inability to pay its debts as they become due or (ix) Borrower,
any SPC Party or any Borrower GP breaches any of the representations,
warranties or covenants applicable to it under Section 3.1.24.

 

Section 11.23       Prior Agreements.  This Agreement and the other Loan Documents contain the
entire agreement of the parties hereto and thereto in respect of the
transactions contemplated hereby and thereby, and all prior agreements among or
between such parties, whether oral or written, are superseded by the terms of
this Agreement and the other Loan Documents.

 

Section 11.24       Servicer.  (a)  At the option of Lender, the Loan may be serviced by
a servicer (the “Servicer”) selected by Lender and Lender may delegate
all or any portion of 

 

101

 

its
responsibilities under this Agreement and the other Loan Documents to the
Servicer pursuant to a servicing agreement (the “Servicing Agreement”)
between Lender and Servicer.  Borrower
shall not be responsible for any set-up fees or any other initial costs
relating to or arising under the Servicing Agreement, or for the payment of any
monthly servicing fee due to the Servicer under the Servicing Agreement.
Servicer shall, however, be entitled to reimbursement of costs and expenses as
and to the same extent (but without duplication) as Lender is entitled thereto
under the applicable provisions of this Agreement and the other Loan
Documents.  In addition, subject to the
express provisions contained elsewhere in this Agreement (including provisions
specifying either an amount, or that no amount, should be payable), Borrower
shall be responsible for the payment of any customary and reasonable servicing
fees charged in connection with any requests made by Borrower during the term
of the Loan, including, but not limited to, approvals, consents, amendments or
waivers contemplated by this Agreement or otherwise.

 

(b)           Upon notice thereof
from Lender, Servicer shall have the right to exercise all rights of Lender and
enforce all obligations of Borrower pursuant to the provisions of this
Agreement, the Note and the other Loan Documents.

 

(c)           Provided Borrower
shall have been given notice of Servicer’s address by Lender, Borrower shall
deliver to Servicer duplicate originals of all notices and other instruments
which Borrower may or shall be required to deliver to Lender pursuant to this
Agreement, the Note and the other Loan Documents (and no delivery of such
notices or other instruments by Borrower shall be of any force or effect unless
delivered to Lender and Servicer as provided above).

 

(d)           Notwithstanding
anything to the contrary contained herein or in any other Loan Documents,
unless the Loan is being transferred to a “special servicer” or is then being “specially
serviced” (in which case Borrower may be required to deal with one primary
Servicer and one “special servicer”), Borrower shall be required to deal with
only one Servicer acting on behalf of all Persons comprising Lender (the “primary
Servicer”), with respect to any consents, approvals or notices required or
permitted from, or to, Servicer or Lender pursuant to the Loan Documents (it
being understood that such Servicer may need to consult with other Persons that
hold a portion of Lender’s rights and obligations under the Loan or with the
Rating Agencies in connection with any such consent, approval or notice and
that a so-called “special servicer” may act as such primary Servicer).  Lender may replace such primary Servicer with
another primary Servicer at any time in Lender’s sole discretion.  As of the date hereof, Wachovia Bank, N.A.,
in its capacity as servicer under a Servicing Agreement with Lender, is hereby
designated as the primary Servicer and unless and until Borrower is notified by
all Persons comprising Lender of
a new primary Servicer, Borrower shall be permitted to rely conclusively and
irrevocably on such designation.

 

Section 11.25       Joint and Several
Liability.  If more than one Person has executed this
Agreement as “Borrower,” the representations, covenants, warranties and
obligations of all such Persons hereunder shall be joint and several.

 

Section 11.26       Creation of Security Interest.  Notwithstanding any other provision set forth in this
Agreement, the Note, the Mortgage or any of the other Loan 

 

102

 

Documents, Lender
may at any time create a security interest in all or any portion of its rights
under this Agreement, the Note, the Mortgage and any other Loan Document
(including, without limitation, the advances owing to it) in favor of any
Federal Reserve Bank in accordance with Regulation A of the Board of Governors
of the Federal Reserve System.

 

Section 11.27       Assignments and
Participations.  (a)  The Lender may assign to one or more
Persons other than (as long as no Event of Default has occurred and is
continuing) any Excluded Lender Transferee all or a portion of its rights and
obligations under this Loan Agreement (it being agreed that the foregoing shall
not apply to the holder of any Securities issued in a pooled-loan
Securitization).

 

(b)           Lender may sell
participations to one or more Persons other than (as long as no Event of
Default has occurred and is continuing) any Excluded Lender Transferee in or to
all or a portion of its rights and obligations under this Loan Agreement (it being agreed that the foregoing
shall not apply to the holder of any Securities issued in a pooled-loan
Securitization); provided, however, that (i) Lender’s
obligations under this Loan Agreement shall remain unchanged, (ii) except
as otherwise provided in Section 2.5, Lender
shall remain solely responsible to the other parties hereto for the performance
of such obligations, (iii) Lender shall remain the holder of any Note for
all purposes of this Loan Agreement and (iv) Borrower shall continue to
deal solely and directly with Lender in connection with Lender’s rights and
obligations under and in respect of this Loan Agreement and the other Loan
Documents.

 

(c)           Lender may, in
connection with any assignment or participation or proposed assignment or
participation pursuant to this Section 11.27, disclose to the
assignee or participant or proposed assignee or participant, as the case may
be, any information relating to Borrower or any of its Affiliates or to any
aspect of the Loan that has been furnished to the Lender by or on behalf of the
Borrower or any of its Affiliates, subject to such Person keeping all such
information Confidential.

 

(d)           Subject to
acceptance and recording thereof pursuant to paragraph (e) of this Section 11.27,
from and after the effective date specified in each Assignment and Acceptance
the assignee thereunder shall be a party hereto and, to the extent of the
interest assigned by such Assignment and Acceptance, have the rights and
obligations of Lender under this Agreement. 
Any assignment or transfer by Lender of rights or obligations under this
Agreement that does not comply with this Section 11.27 shall be
treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with clause (b) of
this Section 11.27.

 

(e)           Lender or an agent
of Lender shall maintain a register (the “Register”) on which it will
record the Loans made hereunder, and each Assignment and Acceptance and
participation.  The Register shall
include the names and addresses of Lenders (including all assignees, successors
and Participants), and the commitment of, and principal amount of the Loans
owing to each such Lender. Failure to make any such recordation, or any error
in such recordation shall not affect the Borrower’s obligations in respect of
such Loans.  If Lender sells an
assignment or participation in any Loan, it shall update the register to
reflect such assignment or participation.

 

103

 

(f)            Notwithstanding
anything contained herein to the contrary, as long as no Event of Default shall
have occurred and be continuing, no Lender or Participant shall Transfer all or
any portion of the Loan or any interest therein to an Excluded Lender
Transferee or permit or suffer any Transfer such that any portion of or
participation interest in the Loan will be held directly or indirectly by a
Person that is an Excluded Lender Transferee (it being agreed that the
foregoing shall not apply to the holder of any Securities issued in a
pooled-loan Securitization).

 

Section 11.28       Intentionally
Omitted.

 

Section 11.29       Substitution.  After the Closing Date, but prior to the Permitted
Prepayment Date, Borrower may obtain a release of the Lien of a Mortgage (and
the related Loan Documents) encumbering an Individual Property (a “Substituted
Property”) by substituting therefor another property of like kind and
quality acquired by Borrower (individually, a “Substitute Property” and
collectively, the “Substitute Properties”), provided that the
following conditions precedent are satisfied:

 

(a)           Lender shall have
received at least thirty (30) days prior written notice requesting the
substitution and identifying the Substitute Property and the Substituted
Property.

 

(b)           The Allocated Loan
Amount of the Substituted Property, when taken together with the Allocated Loan
Amounts of all other Substituted Properties substituted pursuant to this Section 11.29,
does not exceed thirty-five percent (35%) of the original principal balance of
the Loan.

 

(c)           After giving effect
to the proposed substitution, no Event of Default shall be continuing.

 

(d)           The Substitute
Property shall not have suffered a Casualty or Condemnation which has not been
fully restored.

 

(e)           If the Loan is part
of a Securitization, Lender shall have received an Appraisal of the Substitute
Property, dated no more than sixty (60) days prior to the substitution date,
prepared by a senior commercial appraiser of the American Appraisal Institute
acceptable to the Rating Agencies.

 

(f)            Intentionally
omitted.

 

(g)           Lender shall have
received a current survey for the Substitute Property, certified to the title
insurance company and Lender and their respective successors and assigns, in
substantially the same form and content as the certification of the survey of
the Substituted Property prepared by a professional land surveyor licensed in the
state in which the Substitute Property is located and acceptable to the Rating
Agencies, in accordance with the 1999 Minimum Standard Detail Requirements for
ALTA/ACSM Land Title Surveys. Such survey shall reflect the same legal
description contained in the title insurance policy relating to such Substitute
Property and shall include, among other things, a metes and bounds description
of the real property comprising part of such Substitute Property (unless such
real property has been satisfactorily designated by lot number on a recorded
plat).  The surveyor’s seal shall be
affixed 

 

104

 

to such survey
and, if customary, such survey shall certify whether any portion of the
surveyed property or the improvements thereon is located in a “one-hundred-year
flood hazard area.”

 

(h)           Lender shall have
received a Phase I environmental report acceptable to a reasonably prudent
lender and, if recommended under the Phase I environmental report, a Phase II
environmental report acceptable to a reasonably prudent lender, which concludes
that the Substitute Property does not contain any Hazardous Substances (as
defined in the Environmental Indemnity) requiring remediation under any
Environmental Law (as defined in the Environmental Indemnity) and is not
subject to any known risk of contamination from any off-site Hazardous
Substance.

 

(i)            Lender shall have
received a Physical Conditions Report with respect to the Substitute Property
stating that the Substitute Property is in good condition and repair and free
of damage or waste.  If the Physical
Conditions Report recommends that any repairs be made with respect to the
Substitute Property, such Physical Conditions Report shall include an estimate
of the cost of such recommended repairs and, subject to the terms and
conditions set forth in Section 6.1.2, Borrower shall deposit with
Lender an amount equal to one hundred fifteen percent (115%) of such estimated
cost in the event such estimated cost exceeds $50,000,
which deposit shall
constitute “Required Repair Funds”, and shall be released to Borrower in
accordance with the provisions of Section 6.1.

 

(j)            Lender shall have
received evidence satisfactory to a reasonably prudent lender that the
Substitute Property and its use comply in all material respects with all
applicable Legal Requirements (including, without limitation, zoning,
subdivision and building laws) and such compliance shall be confirmed by
delivery to Lender of report from the Planning and Zoning Resource Corporation or
such other similar consultant which in the ordinary course of its business
provides zoning analyses and reports to institutional lenders.

 

(k)           Lender shall have
received valid certificates of insurance indicating that the requirements for
the policies of insurance required for an Individual Property hereunder have
been satisfied with respect to the Substitute Property and evidence of the
payment of all premiums payable for the existing policy period (or if such
Substitute Property is being added to Borrower’s existing policies, that such
amounts have been escrowed with Lender in accordance with the terms and
conditions of Section 6.3).

 

(l)            Intentionally
omitted.

 

(m)          Intentionally
omitted.

 

(n)           After giving effect
to the substitution, the Debt Service Coverage Ratio for the Loan for the
Property (excluding the Substituted Property and including the Substitute
Property) is not less than the greater of (i) the Debt Service Coverage
Ratio as of the Closing Date and (ii) the Debt Service Coverage Ratio for
the trailing twelve (12) full calendar months as of the date immediately
preceding the substitution; provided that, Borrower shall be permitted
to defease a portion of the Loan in accordance with Section 2.5.2 in order to satisfy the Debt Service
Coverage Ratio test set forth in this clause (n);

 

105

 

(o)           (i) The
Individual Loan-to-Value Ratio of the Substitute Property is not greater than
the lesser of the Individual Loan-to-Value Ratio of the Substituted Property (A) as
of the Closing Date and (B) immediately prior to the substitution, which
determination, with respect to (x) the Substitute Property, if based on an
Appraisal pursuant to the definition of “Individual Loan-to-Value Ratio”, shall
be based on the Appraisal described in clause (e) above and, (y) the
Substituted Property, (I) if the determination is as of the Closing Date
and is based on an Appraisal pursuant to the definition of “Individual
Loan-to-Value Ratio”, shall be based on the Appraisal delivered at closing and,
(II) if the determination is as of immediately prior to date of
substitution and is based on an Appraisal pursuant to the definition of “Individual
Loan-to-Value Ratio”, shall be based on a new Appraisal dated no earlier than
ninety (90) days prior to such substitution, or, (ii) if Borrower is unable to satisfy the foregoing test,
after giving effect to such substitution, the Loan-to-Value Ratio for the
Property (excluding the Substituted Property and including the Substitute
Property) is not greater than the lesser of (A) the Loan-to-Value Ratio as
of the Closing Date, which, if based on Appraisals pursuant to the definition
of “Loan-to-Value Ratio”, shall be based on the Appraisals delivered at
closing, and (B) the Loan-to-Value Ratio as of the date immediately
preceding such substitution, which, if based on Appraisals pursuant to the
definition of “Loan-to-Value Ratio”, shall be based on Appraisals dated no
earlier than ninety (90) days prior to the date of such substitution.

 

(p)           Lender shall have
received an Officer’s Certificate certifying that the representations and
warranties of Borrower contained in this Agreement and the other Loan Documents
are true and correct in all material respects on and as of the date of the
substitution with respect to the Substitute Property and, if the Loan is part
of a Securitization, containing any other representations and warranties with
respect to the Substitute Property as the Rating Agencies may require, such
certificate to be in form and substance satisfactory to the Rating Agencies.

 

(q)           Borrower shall (i) have
executed, acknowledged and delivered to Lender (A) a Mortgage, an
Assignment of Leases and two UCC-1 Financing Statements with respect to the
Substitute Property, together with a letter from Borrower countersigned by a
title insurance company acknowledging receipt of such Mortgage, Assignment of
Leases and UCC-1 Financing Statements and agreeing to record or file, as
applicable, such Mortgage, Assignment of Leases and one of the UCC-1 Financing
Statements in the real estate records for the county in which the Substitute
Property is located and to file one of the UCC-1 Financing Statements in the
office of the Secretary of State (or other central filing office) of the state
of its organization, so as to effectively create upon such recording and filing
valid and enforceable Liens upon the Substitute Property, of the requisite
priority, in favor of Lender (or
such other trustee as may be desired under local law), subject only to the
Permitted Encumbrances and such other Liens as are permitted pursuant to the
Loan Documents and (B) an Environmental Indemnity with respect to the
Substitute Property and (ii) have caused Guarantor to acknowledge and
confirm its obligations under (A) any guaranty executed and delivered by
Guarantor in connection with the Loan and (B) the Environmental
Indemnity.  The Mortgage, Assignment of
Leases, UCC-1 Financing Statements and Environmental Indemnity shall be the
same in form and substance as the counterparts of such documents executed and
delivered with respect to the Substituted Property subject to modifications
reflecting the Substitute Property as the Individual Property that is the
subject of such documents and such modifications reflecting the laws of the state
in which the Substitute Property is located as shall be recommended for similar
transactions by the 

 

106

 

counsel admitted
to practice in such state and delivering the opinion as to the enforceability
of such documents required pursuant to subsection (u) below.  The Mortgage encumbering the Substitute
Property shall secure all amounts evidenced by the Note, provided that in the event that the jurisdiction in
which the Substitute Property is located imposes a mortgage recording,
intangibles or similar tax and does not permit the allocation of indebtedness
for the purpose of determining the amount of such tax payable, the principal
amount secured by such Mortgage shall be equal to one hundred twenty-five percent
(125%) of the Allocated Loan Amount of the Substitute Property.  The amount of the Loan allocated to the
Substitute Property (such amount being hereinafter referred to as the “Substitute
Allocated Loan Amount”) shall equal the Allocated Loan Amount of the
Substituted Property immediately prior to the substitution and the Allocated
UCF Amount of the Substitute Property shall be equal to the Allocated UCF
Amount of the Substituted Property immediately prior to the substitution.
Further, Lender shall, in its reasonable discretion, provide an Allocated
Capital Expenditure Amount for the Substitute Property, which Allocated Capital
Expenditure Amount shall be equal to $0.03 per cubic foot of such Substitute
Property and which, when aggregated with the Allocated Capital Expenditure
Amounts of each remaining Individual Property, shall not exceed the Capital
Expenditure Maximum Amount. Schedule VI will be deemed to be modified to
reflect any such changes to the Allocated Loan Amount, Allocated UCF Amount and
Allocated Capital Expenditure Amount for each Individual Property subsequent to
a substitution.

 

(r)            Lender shall have
received (i) unless Borrower shall have elected to provide title insurance
in an amount equal to one hundred twenty-five percent (125%) of the Substitute
Allocated Loan Amount as set forth in clause (A) of Section 11.29(q),
a “tie-in” or similar endorsement, but only to the extent available in such
jurisdiction, to each title insurance policy insuring the Lien of an existing
Mortgage (which shall be tied in as of the Closing Date) with respect to such
existing Mortgages and as of the date of the substitution with respect to the
title insurance policy insuring the Lien of the Mortgage with respect to the
Substitute Property and (ii) a title insurance policy (or a marked, signed
and redated commitment to issue such title insurance policy) insuring the Lien
of the Mortgage encumbering the Substitute Property, issued by the title
company that issued the title insurance policies insuring the Lien of the
existing Mortgages and dated as of the date of the substitution, with
reinsurance and direct access agreements that replace such agreements issued in
connection with the title insurance policy insuring the Lien of the Mortgage
encumbering the Substituted Property. 
The title insurance policy issued with respect to the Substitute
Property shall (A) at Borrower’s option, provide coverage in the amount of
the Substitute Allocated Loan Amount if the “tie-in” or similar endorsement described above is available or,
in lieu of a tie-in endorsement, in an amount equal to one hundred twenty-five
percent (125%)  of the
Substitute Allocated Loan Amount, (B) insure Lender that the relevant
Mortgage creates a valid first lien on the Substitute Property encumbered
thereby, free and clear of all exceptions from coverage other than Permitted
Encumbrances and standard exceptions and exclusions from coverage (as modified
by the terms of any endorsements), (C) contain such endorsements and
affirmative coverages reasonably requested by Lender, but only to the extent
the same are available in the jurisdiction in which the Substitute Property is
located, and (D) name Lender as the insured.  Lender also shall have received copies of
paid receipts or other evidence showing that all premiums in respect of such
endorsements and title insurance policies have been paid.

 

107

 

(s)           Lender shall have received (i) an
endorsement to the title insurance policy insuring the Lien of the Mortgage
encumbering the Substitute Property insuring that the Substitute Property
constitutes a separate tax lot or, if such an endorsement is not available in
the state in which the Substitute Property is located, a letter from the title
insurance company issuing such Title Insurance Policy stating that the
Substitute Policy constitutes a separate tax lot or (ii) a letter from the
appropriate taxing authority stating that the Substitute Property constitutes a
separate tax lot or other evidence satisfactory to a reasonably prudent lender
as to same.

 

(t)            Borrower shall deliver or cause to
be delivered to Lender (i) updates certified by Borrower of all organizational
documentation related to Borrower and/or the formation, structure, existence,
good standing and/or qualification to do business delivered to Lender on the
Closing Date; (ii) good standing certificates, certificates of
qualification to do business in the jurisdiction in which the Substitute
Property is located (if required in such jurisdiction); and (iii) resolutions
of Borrower authorizing the substitution and any actions taken in connection
with such substitution.

 

(u)           Lender shall have received the
following opinions of Borrower’s counsel: (i) an opinion or opinions of
counsel, admitted to practice under the laws of the state in which the
Substitute Property is located, stating that the Loan Documents governed by
such state law delivered with respect to the Substitute Property are valid and
enforceable in accordance with their terms, subject to the laws applicable to
creditors’ rights and equitable principles, and that Borrower is qualified to
do business and in good standing under the laws of the jurisdiction where the
Substitute Property is located or that Borrower is not required by applicable
law to qualify to do business in such jurisdiction; (ii) an opinion of
counsel acceptable to the Rating Agencies, if the Loan is part of a Securitization,
or reasonably acceptable to the Lender, if the Loan is not part of a
Securitization, stating that the Loan Documents delivered with respect to the
Substitute Property pursuant to clause (i) above were duly
authorized, executed and delivered by such Borrower; (iii) an opinion of
counsel acceptable to, the Rating Agencies if the Loan is part of a
Securitization, or the Lender if the Loan is not part of a Securitization,
stating either (x) that subjecting the Substitute Property to the Lien of
the related Mortgage and the execution and delivery of the related Loan
Documents do not and will not affect or impair the ability of Lender to enforce
its remedies under all of the Loan Documents or (y) this Agreement, after
giving effect to the Loan Documents executed in connection with the
substitution, shall be enforceable in accordance with its terms; (iv) an
update of the Insolvency Opinion indicating that the substitution does not
affect the opinions set forth therein; and (v) if the Loan is part of a
Securitization, an opinion of counsel acceptable to the Rating Agencies that
the substitution does not constitute a “significant modification” of the Loan
under Section 1001 of the Code or otherwise cause a tax to be imposed on a
“prohibited transaction” by the REMIC Trust holding the Loan. Such opinions, to
the extent applicable, shall be substantially in the respective forms approved
by Lender in connection with the origination of the Loan, and shall contain
customary assumptions and qualifications.

 

(v)           To the extent such escrows would be
required pursuant to the terms and conditions set forth in Article VI,
Borrower shall have paid, or escrowed with Lender, all Basic Carrying Costs relating to the Substitute Property,
including without limitation, (i) accrued but unpaid insurance premiums
relating to each of the Individual Properties and the Substitute Property, and (ii) currently
due and payable Taxes (including any in arrears) relating to each of 

 

108

 

the Individual Properties
and the Substitute Property and (iii) currently due and payable
maintenance charges and other impositions relating to each of the Individual
Properties and Substitute Property after taking into account Reserve Funds held
in connection with the Substituted Property and available as Reserve Funds for
the Substitute Property.

 

(w)          Lender shall have received such other
amendments and modifications to this Agreement and the other Loan Documents as
would be requested by a reasonably prudent lender originating commercial loans
for securitization similar to the Loan in order to reflect and effect the
substitution and to protect and preserve the Liens and security interests of
Lender in the Substitute Property.

 

(x)            Lender shall have received such
other and further approvals, opinions, documents and information in connection
with the substitution as requested by the Rating Agencies if the Loan is part
of a Securitization.

 

(y)           If the Loan is part of a
Securitization, Borrower shall have delivered to Lender a Rating Agency
Confirmation with respect to the substitution.

 

(z)            Borrower shall convey the
Substituted Property to another Person other than an SPC Party.

 

(aa)         Borrower shall submit to Lender for its
review, not less than fifteen (15)
days prior to the
date of such substitution, a release of Lien (and related Loan Documents) for
the Substituted Property to be executed by Lender. Such release shall be in a
form appropriate for the jurisdiction in which the Substituted Property is
located and that contains standard provisions protecting the rights of the
releasing lender.  In addition, Borrower
shall provide all other documentation that a reasonably prudent lender
originating commercial loans for securitization similar to the Loan would
require to be delivered by Borrower in connection with such release, together
with all Certificate certifying that such documentation (i) is in
compliance with all Legal Requirements, and (ii) will effect such release
in accordance with the terms of this Agreement.

 

(bb)         Borrower shall deliver an Officer’s
Certificate certifying that the requirements set forth in this Section 11.29
have been satisfied.

 

(cc)         Borrower shall have paid or reimbursed
Lender for all reasonable out-of-pocket costs and expenses incurred by Lender
(including, without limitation, reasonable attorneys fees and disbursements) in
connection with the substitution. 
Borrower shall have paid all recording charges, filing fees, taxes or
other expenses (including, without limitation, mortgage and intangibles taxes
and documentary stamp taxes) payable in connection with the substitution.  If the Loan is part of a Securitization,
Borrower shall have paid all costs and expenses of the Rating Agencies incurred
in connection with the substitution.

 

(dd)         Upon the satisfaction of the foregoing
conditions precedent, Lender will release its Lien from the Substituted
Property (or assign such Lien, as applicable) and the Substitute Property shall
be deemed to be an Individual Property for purposes of this Agreement and the
Substitute Allocated Loan Amount with respect to such Substitute Property shall
be deemed to be the Allocated Loan Amount with respect to such Substitute
Property for all purposes hereunder.

 

109

 

Following the substitution
of a Substituted Property in exchange for a Substitute Property in accordance
with this Section 11.29, Lender shall adjust (if applicable) the
amounts thereafter required to be deposited by Borrower into the Reserve Funds
to reflect amounts required solely for the remaining Individual Properties and
the Substitute Property after giving effect to such substitution.

 

Section 11.30   Partial Release –
Expansion.  (a)  Provided no Event of Default shall have
occurred and remain uncured and provided that the intended use, at the
time of the transfer of the Expansion Parcel is not for purposes incompatible
with the use and operation of the applicable Individual Property as a dry
and/or cold storage warehouse facility (it being agreed that, except with
respect to the Carthage Property, the use of the Expansion Parcel as a dry
and/or cold storage warehouse facility is not incompatible with the use and
operation of the remainder of the applicable Individual Property as a dry
and/or cold storage warehouse facility), Borrower shall have the right at any
time and from time to time prior to the Maturity Date to obtain a release of
the lien of the Mortgage (and related Loan Documents) as to an Expansion Parcel
upon satisfaction of the following conditions precedent:

 

(i)            Borrower
shall provide Lender not less than thirty (30) days’ notice (or a shorter
period of time if permitted by Lender in its sole discretion) specifying the
date (the “Expansion Date”) on which the partial release is to occur provided,
however, that Borrower may postpone the Expansion Date from time to time
as long as the extended date is at least ten (10) Business Days after
Notice of such extension;

 

(ii)           Lender
shall have received an Officer’s Certificate certifying (A) that the
proposed use of the Expansion Parcel would not be incompatible with a dry
and/or cold storage warehouse facility on the remainder of the applicable
Individual Property, (B) that the excess of Gross Revenue over Operating
Expenses for the individual Property immediately after the proposed
release after taking into account the proposed use of the Expansion Parcel will
not be less than the excess of Gross Revenue over Operating Expenses for the
Individual Property immediately before the proposed release and (C) that
the proposed use of the Expansion Parcel will not have a material adverse
effect on the income and expense at the Individual Property, together with
evidence reasonably acceptable to Lender in support of such conclusions;

 

(iii)          Borrower
shall deliver to Lender an opinion of counsel for Borrower that is standard in
commercial lending transactions and subject only to customary qualifications,
assumptions and exceptions opining, among other things, that if a
Securitization of any portion of the Loan has occurred, the REMIC Trust formed
pursuant to such Securitization will not fail to maintain its status as a “real
estate mortgage investment conduit” within the meaning of Section 860D of
the Code as a result of the partial release pursuant to this Section 11.30;

 

(iv)          Borrower
shall have delivered to Lender evidence that Borrower has complied with all
requirements of and obtained all approvals required under any Leases with Major
Tenants and the Operating Agreements applicable to the release of the Expansion
Parcel and that the partial release does not violate any of the provisions of
any Leases with Major Tenants and the Operating Agreements provided, however,
that an 

 

110

 

Officer’s Certificate to that effect shall be
sufficient evidence of such compliance and obtaining of such approvals as to
Leases which are not Major Leases;

 

(v)           Borrower
shall have delivered to Lender (A) at Borrower’s option, (x) an
endorsement to the Title Insurance Policy, (y) an opinion of counsel (from
counsel reasonably acceptable to Lender) or (z) a certificate of an
architect (from an architect reasonably acceptable to Lender and licensed to
practice in the State), indicating that the Expansion Parcel has been legally
subdivided for zoning lot purposes from the remainder of the Individual
Property pursuant to a zoning lot subdivision in accordance with applicable
law, (B) at Borrower’s option, (x) an endorsement to the Title
Insurance Policy, (y) an opinion of counsel (from counsel reasonably
acceptable to Lender) or (z) a certificate of an architect (from an
architect reasonably acceptable to Lender and licensed to practice in the
State), indicating that the balance of the Individual Property separately
conforms to and is in material compliance with all applicable Legal
Requirements and constitutes one or more separate tax lots, (C) a
certificate from an architect or engineer (licensed to practice in the State
and reasonably acceptable to Lender) to the effect that the Expansion Parcel is
not necessary for the use of the remainder of the Individual Property in the
manner in which it is then being used, including, without limitation, for
support, access, driveways, parking, utilities or drainage flows (after giving
effect to any easements therefor reserved over the Expansion Parcel for the
benefit of the remainder of the Individual Property) and (D) an Officer’s
Certificate with supporting documentation indicating that either (y) sufficient
parking remains on the remainder of the Individual Property to comply with
all Leases of such remainder and with all Operating Agreements and which is
adequate for the proper use and enjoyment of the balance of the Individual
Property or (z) reservations of parking (in favor of such remainder) in the
Expansion Parcel are sufficient (when added to parking otherwise available to
the remainder) to comply with all
Leases of such
remainder and with all Operating Agreements and which are adequate for the
proper use and enjoyment of the remainder of the Individual Property;

 

(vi)          Lender
shall have received a Officer’s Certificate certifying that any improvements
proposed to be built on the Expansion Parcel will not adversely affect the
operation of the remainder of the Individual Property (after giving effect to
any easements reserved or granted for the benefit of such remainder or the
Expansion Parcel);

 

(vii)         Lender
shall have received an Appraisal of the Individual Property (using an income
method of valuation (it being agreed that in conducting such valuation any
income that might be derived from the sale or subsequent use of such Expansion
Parcel shall not be included)) dated no more than ninety (90) days prior to the
proposed Expansion Date by an appraiser (which appraiser shall be reasonably
acceptable to Lender), indicating an appraised value of the Individual Property
after the release, both before and after construction of improvements to be
built on the Expansion Parcel, equal to or greater than the greater of (y) one
hundred percent (100%) of the value of such Individual Property immediately
prior to the release or (z) one hundred percent (100%) of the Allocated
Loan Amount for such Individual Property on the Expansion Date;

 

111

 

(viii)        Borrower
shall have delivered a metes and bounds description of the Expansion Parcel and
a survey of the Expansion Parcel and the remainder of the Individual Property
which would be standard in commercial lending transactions;

 

(ix)           Borrower
shall have delivered to Lender on the date of the release an endorsement to the
policy or policies of title insurance insuring the Mortgage on such Individual
Property reflecting the release and (A) insuring Lender’s interest in any
easements created in connection with the Release and (B) confirming no
change in the priority of the Mortgage on the remainder of the Individual
Property or in the amount of the insurance or the coverage under the policy or
policies;

 

(x)            Borrower
shall deliver to Lender an Officer’s Certificate certifying that the
requirements set forth in this Section 11.30 have been satisfied;
and

 

(xi)           Borrower
shall pay all out-of-pocket costs and expenses of Lender incurred in connection
with the partial release, including Lender’s reasonably attorneys’ fees and
expenses.

 

(b)           If Borrower shall provide a Letter of
Credit to Lender on the Expansion Date as additional security for the Loan, the
amount of the Loan equal to the amount of the Letter of Credit shall be added
to the appraised value of the remainder of the Property after the release for
the purposes of doing the comparison in Section 11.30(a)(vii).

 

(c)           If Borrower has elected to release
the Expansion Parcel and the requirements of this Section 11.30
have been satisfied, the Expansion Parcel shall be released from the Lien of
the Mortgage (and related Loan Documents) and Lender shall consent and
subordinate the Lien of the Mortgage thereto. 
In connection with the release of the Lien, Borrower shall submit to
Lender, not less than thirty (30) days prior to the Expansion Date (or such
shorter time as is reasonably acceptable to Lender), a release of Lien (and
related Loan Documents) for execution by Lender. Such release shall be in a
form appropriate in the Jurisdiction in which the Property is located and shall
contain standard provisions protecting the rights of a releasing lender.  In addition, Borrower shall provide all other
documentation Lender reasonably requires to be delivered by Borrower in
connection with such release, together with an Officer’s Certificate certifying
that such documentation (i) is in compliance with all Legal Requirements,
and (ii) will effect such release in accordance with the terms of this
Agreement.  Borrower shall pay all costs,
taxes and expenses associated with the release of the Lien of the Mortgage,
including Lender’s reasonable attorneys’ fees. 
Borrower shall cause title to the Expansion Parcel so released from the
Lien of the Mortgage to be transferred to and held by a Person other than
Borrower.

 

[NO FURTHER TEXT ON THIS PAGE]

 

112

 

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

 

	
   

  	
  LENDER:

  
	
   

  	
   

  
	
   

  	
  UBS REAL
  ESTATE SECURITIES INC.,

  a Delaware corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Jeffrey N. Lavine

  
	
   

  	
   

  	
  Name:

  	
  Jeffrey N. Lavine

  
	
   

  	
   

  	
  Title:

  	
  Managing Director

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Christopher Reilly

  
	
   

  	
   

  	
  Name:

  	
  Christopher Reilly

  
	
   

  	
   

  	
  Title:

  	
  Managing Director

  

 

 

	
   

  	
  BORROWER:

  
	
   

  	
   

  
	
   

  	
  ART MORTGAGE BORROWER PROPCO 2006-1A L.P., 

  a Delaware limited partnership 

  
	
   

  	
   

  
	
   

  	
  By:

  	
  ART MORTGAGE BORROWER
  PROPCO GP 2006-1A LLC, a Delaware limited liability company, its general
  partner 

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  AMERICOLD REALTY TRUST, a
  Maryland real estate investment trust, its sole equity member 

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Anthony Cossentino

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  ART MORTGAGE BORROWER OPCO 2006-1A L.P., a Delaware limited
  partnership 

  
	
   

  	
   

  
	
   

  	
  By:

  	
  ART MORTGAGE BORROWER OPCO GP 2006-1A LLC, a Delaware
  limited liability company, its general partner 

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  AMERICOLD LOGISTICS LLC, a
  Delaware limited liability company, its sole equity member 

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Anthony Cossentino

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

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