Document:

Exhibit
10.12A

 

 

UNSECURED REVOLVING CREDIT
AGREEMENT

 

 

AMONG

 

 

AMERIVEST PROPERTIES INC.

 

 

AND

 

 

FLEET NATIONAL BANK, AS
ADMINISTRATIVE AGENT

 

 

AND

 

 

THE LENDERS PARTY HERETO

 

 

TABLE
OF CONTENTS

 

	
  §1.

  	
  DEFINITIONS AND
  RULES OF INTERPRETATION

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  §1.1

  	
  Definitions

  	
   

  
	
   

  	
  §1.2

  	
  Rules of Interpretation

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  §2.

  	
  REVOLVING LOAN FACILITY

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  §2.1

  	
  Commitment to
  Lend

  	
   

  
	
   

  	
  §2.2

  	
  The Notes

  	
   

  
	
   

  	
  §2.3

  	
  Interest on
  Loans

  	
   

  
	
   

  	
  §2.4

  	
  Conversion
  Options

  	
   

  
	
   

  	
  §2.5

  	
  Requests
  for Loans

  	
   

  
	
   

  	
  §2.6

  	
  Funds
  for Loans

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  §3.

  	
  REPAYMENT OF THE LOANS

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  §3.1

  	
  Maturity

  	
   

  
	
   

  	
  §3.2

  	
  Mandatory
  Repayments of Loan

  	
   

  
	
   

  	
  §3.3

  	
  Optional
  Repayments of Loans

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  §4.

  	
  CERTAIN GENERAL PROVISIONS

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  §4.1

  	
  Facility
  Fees

  	
   

  
	
   

  	
  §4.2

  	
  Unused Fee

  	
   

  
	
   

  	
  §4.3

  	
  Funds
  for Payments

  	
   

  
	
   

  	
  §4.4

  	
  Computations

  	
   

  
	
   

  	
  §4.5

  	
  Additional
  Costs, Etc

  	
   

  
	
   

  	
  §4.6

  	
  Capital
  Adequacy

  	
   

  
	
   

  	
  §4.7

  	
  Certificate

  	
   

  
	
   

  	
  §4.8

  	
  Indemnity

  	
   

  
	
   

  	
  §4.9

  	
  Default
  Interest and Late Charges

  	
   

  
	
   

  	
  §4.10

  	
  Inability to Determine LIBOR
  Rate

  	
   

  
	
   

  	
  §4.11

  	
  Illegality

  	
   

  
	
   

  	
  §4.12

  	
  Replacement of Lenders

  	
   

  
	
   

  	
  §4.13

  	
  Limitation on Interest

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  §5.

  	
  NO LIMITATION ON RECOURSE

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  §5.1

  	
  [Intentionally Omitted.]

  	
   

  
	
   

  	
  §5.2

  	
  No Limitation on Recourse

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  §6.

  	
  REPRESENTATIONS
  AND WARRANTIES

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  §6.1

  	
  Authority; Etc

  	
   

  
	
   

  	
  §6.2

  	
  Governmental Approvals

  	
   

  
	
   

  	
  §6.3

  	
  Title to Properties; Leases

  	
   

  
	
   

  	
  §6.4

  	
  Financial Statements

  	
   

  

 

i

 

	
   

  	
  §6.5

  	
  No Material
  Changes

  	
   

  
	
   

  	
  §6.6

  	
  Franchises,
  Patents, Copyrights, Etc

  	
   

  
	
   

  	
  §6.7

  	
  Litigation

  	
   

  
	
   

  	
  §6.8

  	
  No
  Materially Adverse Contracts, Etc

  	
   

  
	
   

  	
  §6.9

  	
  Compliance
  With Other Instruments, Laws, Etc

  	
   

  
	
   

  	
  §6.10

  	
  Tax Status

  	
   

  
	
   

  	
  §6.11

  	
  Event
  of Default

  	
   

  
	
   

  	
  §6.12

  	
  Investment
  Company Act

  	
   

  
	
   

  	
  §6.13

  	
  Absence of Financing Statements,
  Etc

  	
   

  
	
   

  	
  §6.14

  	
  [Intentionally
  Omitted.]

  	
   

  
	
   

  	
  §6.15

  	
  Certain Transactions

  	
   

  
	
   

  	
  §6.16

  	
  Benefit
  Plans; Multiemployer Plans; Guaranteed Pension Plans

  	
   

  
	
   

  	
  §6.17

  	
  Regulations
  U and X

  	
   

  
	
   

  	
  §6.18

  	
  Environmental
  Compliance

  	
   

  
	
   

  	
  §6.19

  	
  Subsidiaries and Affiliates

  	
   

  
	
   

  	
  §6.20

  	
  Leases

  	
   

  
	
   

  	
  §6.21

  	
  Loan
  Documents

  	
   

  
	
   

  	
  §6.22

  	
  Property

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  §7.

  	
  AFFIRMATIVE COVENANTS OF THE
  BORROWER

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  §7.1

  	
  Punctual
  Payment

  	
   

  
	
   

  	
  §7.2

  	
  Maintenance
  of Office

  	
   

  
	
   

  	
  §7.3

  	
  Records and
  Accounts

  	
   

  
	
   

  	
  §7.4

  	
  Financial
  Statements, Certificates and Information

  	
   

  
	
   

  	
  §7.5

  	
  Notices

  	
   

  
	
   

  	
  §7.6

  	
  Existence; Maintenance of REIT
  Status; Maintenance of Properties

  	
   

  
	
   

  	
  §7.7

  	
  Insurance

  	
   

  
	
   

  	
  §7.8

  	
  Taxes

  	
   

  
	
   

  	
  §7.9

  	
  Inspection of
  Properties and Books

  	
   

  
	
   

  	
  §7.10

  	
  Compliance with Laws, Contracts,
  Licenses, and Permits

  	
   

  
	
   

  	
  §7.11

  	
  Use of
  Proceeds

  	
   

  
	
   

  	
  §7.12

  	
  Reserved

  	
   

  
	
   

  	
  §7.13

  	
  [Intentionally Omitted.]

  	
   

  
	
   

  	
  §7.14

  	
  Interest
  Rate Protection

  	
   

  
	
   

  	
  §7.15

  	
  Further Assurance

  	
   

  
	
   

  	
  §7.16

  	
  Reserved

  	
   

  
	
   

  	
  §7.17

  	
  Environmental
  Indemnification

  	
   

  
	
   

  	
  §7.18

  	
  Response
  Actions

  	
   

  
	
   

  	
  §7.19

  	
  Environmental Assessments

  	
   

  
	
   

  	
  §7.20

  	
  Employee Benefit Plans

  	
   

  
	
   

  	
  §7.21

  	
  More
  Restrictive Agreements

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  §8.

  	
  CERTAIN NEGATIVE COVENANTS OF THE
  BORROWER

  	
   

  

 

ii

 

	
   

  	
  §8.1

  	
  Restrictions
  on Indebtedness

  	
   

  
	
   

  	
  §8.2

  	
  Restrictions on Liens, Etc

  	
   

  
	
   

  	
  §8.3

  	
  Restrictions on Investments

  	
   

  
	
   

  	
  §8.4

  	
  Merger, Consolidation,
  Acquisition and Disposition of Properties

  	
   

  
	
   

  	
  §8.5

  	
  Sale
  and Leaseback

  	
   

  
	
   

  	
  §8.6

  	
  Compliance
  with Environmental Laws

  	
   

  
	
   

  	
  §8.7

  	
  Distributions

  	
   

  
	
   

  	
  §8.8

  	
  [Intentionally
  Omitted.]

  	
   

  
	
   

  	
  §8.9

  	
  Related Companies

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  §9.

  	
  FINANCIAL COVENANTS OF THE BORROWER

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  §9.1

  	
  Reserved

  	
   

  
	
   

  	
  §9.2

  	
  Reserved

  	
   

  
	
   

  	
  §9.3

  	
  Total
  Liabilities to Gross Asset Value

  	
   

  
	
   

  	
  §9.4

  	
  Adjusted
  EBITDA to Interest Expense

  	
   

  
	
   

  	
  §9.5

  	
  EBITDA to Fixed
  Charges

  	
   

  
	
   

  	
  §9.6

  	
  Minimum Tangible Net
  Worth

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  §10.

  	
  CONDITIONS TO EFFECTIVENESS

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  §10.1

  	
  Loan Documents

  	
   

  
	
   

  	
  §10.2

  	
  Good Standing Certificates
  and Certified Copies

  	
   

  
	
   

  	
  §10.3

  	
  By-laws; Resolutions

  	
   

  
	
   

  	
  §10.4

  	
  Incumbency
  Certificate; Authorized Signers

  	
   

  
	
   

  	
  §10.5

  	
  Opinions
  of Counsel Concerning Organization and Loan Documents

  	
   

  
	
   

  	
  §10.6

  	
  Payment
  of Fees

  	
   

  
	
   

  	
  §10.7

  	
  Compliance Certificate

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  §11.

  	
  CONDITIONS TO ALL BORROWINGS

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  §11.1

  	
  Representations
  True; No Event of Default; Compliance Certificate

  	
   

  
	
   

  	
  §11.2

  	
  No Legal Impediment

  	
   

  
	
   

  	
  §11.3

  	
  Governmental
  Regulation

  	
   

  
	
   

  	
  §11.4

  	
  Proceedings
  and Documents

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  §12.

  	
  EVENTS OF DEFAULT; ACCELERATION; ETC

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  §12.1

  	
  Events of
  Default and Acceleration

  	
   

  
	
   

  	
  §12.2

  	
  Termination
  of Commitments

  	
   

  
	
   

  	
  §12.3

  	
  Remedies

  	
   

  
	
   

  	
  §12.4

  	
  Distribution
  of Proceeds

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  §13.

  	
  SETOFF

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  §14.

  	
  THE AGENT

  	
   

  

 

iii

 

	
   

  	
  §14.1

  	
  Authorization

  	
   

  
	
   

  	
  §14.2

  	
  Employees and Agents

  	
   

  
	
   

  	
  §14.3

  	
  No
  Liability

  	
   

  
	
   

  	
  §14.4

  	
  No
  Representations

  	
   

  
	
   

  	
  §14.5

  	
  Payments

  	
   

  
	
   

  	
  §14.6

  	
  Holders
  of Notes

  	
   

  
	
   

  	
  §14.7

  	
  Indemnity

  	
   

  
	
   

  	
  §14.8

  	
  Agent as Lender

  	
   

  
	
   

  	
  §14.9

  	
  Resignation

  	
   

  
	
   

  	
  §14.10

  	
  Notification
  of Defaults and Events of Default

  	
   

  
	
   

  	
  §14.11

  	
  Duties in the Case of
  Enforcement

  	
   

  
	
   

  	
   

  	
   

  
	
  §15.

  	
  EXPENSES

  	
   

  
	
   

  	
   

  	
   

  
	
  §16.

  	
  INDEMNIFICATION

  	
   

  
	
   

  	
   

  	
   

  
	
  §17.

  	
  SURVIVAL
  OF COVENANTS, ETC

  	
   

  
	
   

  	
   

  	
   

  
	
  §18.

  	
  ASSIGNMENT; PARTICIPATIONS; ETC

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  §18.1

  	
  Conditions to
  Assignment by Lenders

  	
   

  
	
   

  	
  §18.2

  	
  Certain Representations and
  Warranties; Limitations; Covenants

  	
   

  
	
   

  	
  §18.3

  	
  Register

  	
   

  
	
   

  	
  §18.4

  	
  New Notes

  	
   

  
	
   

  	
  §18.5

  	
  Participations

  	
   

  
	
   

  	
  §18.6

  	
  Pledge
  by Lender

  	
   

  
	
   

  	
  §18.7

  	
  No
  Assignment by Borrower

  	
   

  
	
   

  	
  §18.8

  	
  Disclosure

  	
   

  
	
   

  	
   

  	
   

  
	
  §19.

  	
  NOTICES,
  ETC

  	
   

  
	
   

  	
   

  	
   

  
	
  §20.

  	
  GOVERNING LAW; CONSENT TO JURISDICTION AND
  SERVICE

  	
   

  
	
   

  	
   

  	
   

  
	
  §21.

  	
  HEADINGS

  	
   

  
	
   

  	
   

  	
   

  
	
  §22.

  	
  COUNTERPARTS

  	
   

  
	
   

  	
   

  	
   

  
	
  §23.

  	
  ENTIRE
  AGREEMENT

  	
   

  
	
   

  	
   

  	
   

  
	
  §24.

  	
  WAIVER OF JURY TRIAL AND CERTAIN DAMAGE
  CLAIMS

  	
   

  
	
   

  	
   

  	
   

  
	
  §25.

  	
  CONSENTS,
  AMENDMENTS, WAIVERS, ETC

  	
   

  
	
   

  	
   

  	
   

  
	
  §26.

  	
  SEVERABILITY

  	
   

  

 

iv

 

	
  §27.

  	
  RELATIONSHIP

  	
   

  
	
   

  	
   

  	
   

  
	
  §28.

  	
  DEALINGS WITH THE BORROWER

  	
   

  
	
   

  	
   

  	
   

  
	
  §29.

  	
  NO UNWRITTEN AGREEMENTS

  	
   

  
	
   

  	
   

  	
   

  
	
  §30.

  	
  TIME
  OF THE ESSENCE

  	
   

  
	
   

  	
   

  	
   

  
	
  §31.

  	
  RIGHTS OF THIRD PARTIES

  	
   

  

 

v

 

UNSECURED REVOLVING CREDIT AGREEMENT

 

This UNSECURED REVOLVING CREDIT AGREEMENT is
made as of the 15th day of December, 2003, by and among AMERIVEST PROPERTIES INC., a
Maryland corporation (the “Borrower”), and FLEET NATIONAL BANK, a national banking
association (“FNB”), the other lending institutions which are listed on Schedule 1
or hereafter become a party hereto, (the “Lenders”) and FLEET NATIONAL BANK, as agent
for itself and such other lending institutions (the “Agent”).

 

WHEREAS, the Borrower has requested and FNB
has agreed to provide a revolving credit facility in the principal amount of up
to $30,000,000.00, and portions of such facility may be assigned to other
lending institutions.

 

NOW, THEREFORE, to accomplish these purposes,
the Agent, the Borrower and the Lenders hereby agree as follows:

 

§1.                               DEFINITIONS AND RULES OF
INTERPRETATION

 

§1.1                          Definitions. 
The following terms shall have the meanings set forth in this §l or
elsewhere in the provisions of this Agreement referred to below:

 

Adjusted EBITDA.  EBITDA minus the Reserve Amount for all Real
Estate Assets owned by Borrower or any of the Related Companies.

 

Affiliated Lenders.  Any commercial bank which is (i) the parent
corporation of any of the Lenders originally listed on Schedule 1,
(ii) a wholly-owned subsidiary of any of the Lenders or (iii) a wholly-owned
subsidiary of the parent corporation of any of the Lenders.

 

Agent.  Fleet National Bank acting as agent for the
Lenders or any successor agent.

 

Agent’s Head Office.  The Agent’s head office located at 100
Federal Street, Boston, Massachusetts 02110, or at such other location as the
Agent may designate from time to time.

 

Agreement.  This Unsecured Revolving Credit Agreement,
including the Schedules and Exhibits hereto.

 

Agreement Regarding Fees.  The Agreement Regarding Fees of even date
herewith between Borrower and FNB.

 

Arranger.  Fleet Securities, Inc. or any successor.

 

Assignment and Acceptance.  See §18.

 

Balance Sheet Date.  September 30, 2003.

 

Borrower.  As defined in the preamble hereto.

 

Borrowing Date.  The date on which any Loan is made or is to
be made, and the date on which any Loan is converted or continued in accordance
with §2.4.

 

 

Business Day.  Any day other than a Saturday, Sunday or day
which shall be in the Commonwealth of Massachusetts a legal holiday or day on
which banking institutions are required or authorized to close and, in the case
of LIBOR Loans, also a day which is a LIBOR Business Day.

 

Capitalized Leases.  Leases under which the Borrower is the
lessee or obligor, the discounted future rental payment obligations under which
are required to be capitalized on the balance sheet of the Borrower in
accordance with Generally Accepted Accounting Principles.

 

CERCLA. 
See §6.18.

 

Change in Control.  The occurrence of any of the following
events: (A) if during any twelve month period on or after the Closing Date
while any portion of the Loan remains outstanding or Lenders have any
obligation to make further Loans, individuals who at the beginning of such
period constituted the Board of Directors of the Borrower (together with any
new directors whose election by the Board of Directors or whose nomination for
election by the shareholders of the Borrower was approved by a vote of at least
a majority of the members of the Board of Directors then in office who either
were members of the Board of Directors at the beginning of such period or whose
election or nomination for election was previously so approved) cease for any
reason to constitute a majority of the members of the Board of Directors then
in office; or (B) if there occurs a change of control of the Borrower of a
nature that would be required to be reported in response to Item 1a of Form 8-K
filed pursuant to Section 13 or 15 under the Securities Exchange Act of
1934, or in any other filing by the Borrower with the Securities and Exchange
Commission; or (C) if the Borrower or any Related Company consolidates with, is
acquired by, or merges into or with any Person.

 

Closing Date.  The date upon which this Agreement shall
become effective pursuant to §10 and the initial Loan shall be advanced.

 

Code.  The Internal Revenue Code of 1986, as
amended and in effect from time to time.

 

Commitment.  With respect to each Lender, the amount set
forth from time to time on Schedule 1.1 hereto as the amount of
such Lender’s commitment to make Loans to the Borrower.

 

Compliance Certificate.  A certificate in the form of Exhibit C hereto
signed by a Responsible Officer setting forth in reasonable detail computations
evidencing compliance with the covenants contained in §9.1 through §9.6,
§8.3(d) and §8.7.

 

Controlled Unconsolidated Entity.  An Unconsolidated Entity to the extent that
the Borrower has the authority to make management decisions on behalf of such
Unconsolidated Entity, or when this term is used with respect to the negative
covenants herein, an Unconsolidated Entity in which the Borrower has the right
or ability to prevent such Unconsolidated Entity from taking the action which
is prohibited by the applicable negative covenant.

 

Conversion Request.  A notice given by the Borrower to the Agent
of its election to convert or continue a Loan in accordance with §2.4.

 

2

 

Default. 
See §12.1.

 

Distribution.  The declaration or payment of any dividend
or distribution of cash or cash equivalents to the shareholders of the Borrower
or the limited partners of any operating partnership in which the Borrower is a
general partner.

 

Dollars or $.  Dollars in lawful currency of the United
States of America.

 

Domestic Lending Office.  Initially, the office of each Lender
designated as such in Schedule 1.1 hereto; thereafter, such other
office of such Lender, if any, located within the United States that will be
making or maintaining Prime Rate Loans.

 

EBITDA.  For any period of calculation and without
duplication, net income (loss) of Borrower for such period (determined in
accordance with Generally Accepted Accounting Principles, before allocations to
minority interests and excluding all amounts attributable to the net income or
net losses of Unconsolidated Entities) plus the sum of the following amounts
(but only to the extent included in determining net income (loss) for such
period):  (a) depreciation and
amortization expense of Borrower for such period plus (b) Interest Expense
for such period plus (c) income tax expense of Borrower in respect of such
period plus (d) extraordinary losses of Borrower, losses from the sale of
assets of Borrower and losses resulting from forgiveness of debt by Borrower,
all for such period minus (e) extraordinary gains of Borrower and gains
from the sale of assets of Borrower for such period plus (f) any cash
dividends or distributions actually received (and not reinvested) by Borrower
from its Unconsolidated Entities.

 

Effective Date.  The date upon which this Agreement shall
become effective pursuant to §10.

 

Eligible Assignee.  Any of (a) a commercial bank organized under
the laws of the United States, or any State thereof or the District of
Columbia, and having total assets in excess of $1,000,000,000; (b) a savings
and loan association or savings bank organized under the laws of the United
States, or any State thereof or the District of Columbia, and having a net
worth of at least $100,000,000, calculated in accordance with Generally
Accepted Accounting Principles; (c) a commercial bank organized under the laws
of any other country which is a member of the Organization for Economic
Cooperation and Development (the “OECD”), or a political subdivision of any
such country, and having total assets in excess of $1,000,000,000, provided
that such bank is acting through a branch or agency located in the country in
which it is organized or another country which is also a member of the OECD;
and (d) the central bank of any country which is a member of the OECD; (e) an
insurance company and other institutional investor having a net worth of at
least $100,000,000 that, in the reasonable judgment of the Agent, has
substantial experience in real estate lending or investing in loans similar to
the Loans; (f) an investment fund or similar entity having a net worth of at
least $100,000,000 that is engaged in making, purchasing or holding bank loans
or similar extensions of credit and that is managed by an investment advisor
that, in the reasonable judgment of the Agent, has substantial experience in
real estate lending or investing in loans similar to the Loans or (g) an Affiliated
Lender, provided, however that neither the Borrower, any of the Related
Companies or any of the Unconsolidated Entities nor any affiliate thereof shall
be Eligible Assignees.

 

3

 

Employee Benefit Plan.  Any employee benefit plan within the meaning
of §3 (3) of ERISA maintained or contributed to by the Borrower or any ERISA
Affiliate, other than a Multiemployer Plan.

 

Environmental Laws.  See §6.18(a).

 

ERISA.  The Employee Retirement Income Security Act
of 1974, as amended and in effect from time to time.

 

ERISA Affiliate.  Any Person which is treated as a single
employer with the Borrower under §414 of the Code.

 

ERISA Reportable Event.  A reportable event with respect to a
Guaranteed Pension Plan within the meaning of §4043 of ERISA and the
regulations promulgated thereunder as to which the requirement of notice has
not been waived.

 

Eurocurrency Reserve Rate.  For any day with respect to a LIBOR Loan,
the maximum rate (expressed as a decimal) at which any Lender subject thereto
would be required to maintain reserves (a “Eurocurrency Reserve”) under
Regulation D of the Board of Governors of the Federal Reserve System (or any
successor or similar regulations relating to such reserve requirements) against
“Eurocurrency Liabilities” (as that term is used in Regulation D), if such
liabilities were outstanding. The Eurocurrency Reserve Rate shall be adjusted
automatically on and as of the effective date of any change in the Eurocurrency
Reserve Rate.

 

Event of Default.  See §12.1.

 

Facility Percentage.  With respect to each Lender, the percentage
set forth from time to time on Schedule 1.1 hereto as such Lender’s
percentage of the Total Commitment.

 

Fixed Charges.  With respect to any fiscal period of the Borrower,
an amount equal to the sum of (i) Interest Expense, (ii) regularly scheduled
installments of principal payable with respect to all Indebtedness of Borrower
and the Related Companies, excluding any balloon payments due at the maturity
of such Indebtedness, plus (iii) all dividend payments due to the holders of
any preferred stock of the Borrower.

 

FNB. 
See preamble.

 

Funds From Operations.  With respect to any fiscal period of the
Borrower, an amount equal to net income (computed in accordance with Generally
Accepted Accounting Principles) from the operation of Real Estate Assets,
excluding gains (or losses) from debt restructuring and sales of property, plus
real estate depreciation and amortization, and after adjustments for
unconsolidated partnerships and joint ventures. Adjustments for unconsolidated
partnerships and joint ventures will be calculated to reflect funds from
operations on the same basis.

 

Generally Accepted Accounting Principles.  Principles that are (a) consistent with the
principles promulgated or adopted by the Financial Accounting Standards Board
and its predecessors, as in effect from time to time and (b) consistently
applied with past financial statements of the Borrower adopting the same
principles; provided that a certified public

 

4

 

accountant
would, insofar as the use of such accounting principles is pertinent, be in a
position to deliver an unqualified opinion (other than a qualification
regarding changes in Generally Accepted Accounting Principles) as to financial
statements in which such principles have been properly applied.

 

Gross Asset Value.  At any date, Borrower’s total assets,
adjusted to add back the accumulated depreciation of its real estate assets,
all as determined in accordance with Generally Accepted Accounting Principals
as of such date, plus $4,507,557 (which amount represents the difference
between the purchase price and historical net book value of Sheridan Plaza upon
Borrower’s acquisition in 2001).

 

Guaranteed Pension Plan.  Any employee pension benefit plan within the
meaning of §3(2) of ERISA maintained or contributed to by the Borrower or any
ERISA Affiliate the benefits of which are guaranteed on termination in full or
in part by the PBGC pursuant to Title IV of ERISA, other than a Multiemployer
Plan.

 

Hazardous Substances.  See §6.18(b).

 

Indebtedness.  All obligations, contingent and otherwise,
that in accordance with Generally Accepted Accounting Principles should be
classified upon the obligor’s balance sheet as liabilities, or to which
reference should be made by footnotes thereto, including, without limitation,
all of the following, whether or not so classified: (a) the Obligations, (b)
all debt and similar monetary obligations, whether direct or indirect; (c) all
liabilities secured by any mortgage, pledge, negative pledge, security
interest, lien, negative lien, charge, or other encumbrance existing on
property owned or acquired subject thereto, whether or not the liability
secured thereby shall have been assumed; (d) all guarantees, endorsements and
other contingent obligations whether direct or indirect in respect of
indebtedness or obligations of others, including any liability as the general
partner of a partnership, any obligation to supply funds to or in any manner to
invest in, directly or indirectly, the debtor, to purchase indebtedness, or to
assure the owner of indebtedness against loss, through an agreement to purchase
goods, supplies, or services for the purpose of enabling the debtor to make
payment of the indebtedness held by such owner or otherwise, and the
obligations to reimburse the issuer in respect of any letters of credit; and
(e) such obligor’s liabilities, contingent or otherwise of the type set forth
in (a) through (d) above, under any joint venture, limited liability company or
partnership agreement.

 

Intangible Assets.  Collectively, (i) the amount (to the extent
reflected in determining Borrower’s total assets) of all write-ups (other than
write-ups resulting from foreign currency translations and write-ups of assets
of a going concern business made within 12 months after the acquisition of such
business) in the book value of any asset (other than real property assets)
owned by Borrower, and (ii) goodwill, patents, trademarks, service marks,
trade names, anticipated future benefit of tax loss carry forwards, copyrights,
organization or developmental expenses, deferred financing costs, and other
intangible assets.

 

Interest Expense.  With respect to any fiscal period of the
Borrower, an amount equal to the sum of the following with respect to all
Indebtedness of the Borrower and the Related Companies: (i) total interest
expense, accrued in accordance with Generally Accepted

 

5

 

Accounting
Principles plus (ii) all capitalized interest determined in accordance with
Generally Accepted Accounting Principles.

 

Interest Payment Date.  As to any Prime Rate Loan or LIBOR Loan, the
first day of each calendar month.

 

Interest Period.  With respect to each Loan, (a) initially,
the period commencing on the Borrowing Date of such Loan and ending on the last
day of one of the periods set forth below, as selected by the Borrower in a
Loan Request or Conversion Request, as applicable, (i) for any Prime Rate Loan,
the day on which such Prime Rate Loan is paid in full or converted to a LIBOR
Loan; and (ii) for any LIBOR Loan, 1, 2 or 3 months; and (b) thereafter, each
period commencing on the last day of the next preceding Interest Period
applicable to such Loan and ending on the last day of one of the periods set
forth above, as selected by the Borrower in a Conversion Request; provided that
all of the foregoing provisions relating to Interest Periods are subject to the
following:

 

(A)                              if any Interest Period
with respect to a LIBOR Loan would otherwise end on a day that is not a LIBOR
Business Day, that Interest Period shall be extended to the next succeeding
LIBOR Business Day unless the result of such extension would be to carry such
Interest Period into another calendar month, in which event such Interest
Period shall end on the immediately preceding LIBOR Business Day;

 

(B)                                if any Interest Period
with respect to a Prime Rate Loan would end on a day that is not a Business
Day, that Interest Period shall end on the next succeeding Business Day;

 

(C)                                if the Borrower shall
fail to give notice as provided in §2.4, the Borrower shall be deemed to have
requested a conversion of the affected LIBOR Loan to a Prime Rate Loan on the
last day of the then current Interest Period with respect thereto;

 

(D)                               any Interest Period
relating to any LIBOR Loan that begins on the last LIBOR Business Day of a
calendar month (or on a day for which there is no numerically corresponding day
in the calendar month at the end of such Interest Period) shall end on the last
LIBOR Business Day of a calendar month; and

 

(E)                                 any Interest Period
relating to any LIBOR Loan that would otherwise extend beyond the Maturity Date
shall end on the Maturity Date.

 

Investments. All
expenditures made and all liabilities incurred (contingently or otherwise) for
the acquisition of stock, partnership or membership interests or Indebtedness
of, or for loans, advances, capital contributions or transfers of property to,
or in respect of any guaranties (or other commitments as described under
Indebtedness), or obligations of, any Person. In determining the aggregate
amount of Investments outstanding at any particular time: (a) the amount of any
Investment represented by a guaranty shall be taken at not less than the
principal amount of the obligations guaranteed and still outstanding; (b) there
shall be included as an Investment all interest accrued with respect to
Indebtedness constituting an Investment unless and until such interest is paid;
(c) there shall be deducted in respect of each such Investment any amount
received as a return of capital (but only by repurchase, redemption,
retirement, repayment, liquidating dividend or liquidating distribution); (d)
there shall not be

 

6

 

deducted in
respect of any Investment any amounts received as earnings on such Investment,
whether as dividends, interest or otherwise, except that accrued interest
included as provided in the foregoing clause (b) may be deducted when paid; and
(e) there shall not be deducted from the aggregate amount of Investments any
decrease in the value thereof.

 

Lenders.  FNB and the other lending institutions
listed from time to time on Schedule 1 hereto and any other Person
who becomes an assignee of any rights of a Lender pursuant to §18 or a Person
who acquires all or substantially all of the stock or assets of a Lender.

 

LIBOR.  As applicable to any LIBOR Loan, the rate
per annum as determined on the basis of the offered rates for deposits in U.S.
Dollars, for a period of time comparable to the Interest Period applicable to
such LIBOR Loan which appears on the Telerate page 3750 as of 11:00 a.m. London
time on the day that is two LIBOR Business Days preceding the first day of such
LIBOR Loan; provided, however, if the rate described above does not appear on
the Telerate System on any applicable interest determination date, the LIBOR
rate shall be the rate (rounded upward, if necessary, to the nearest one
hundred-thousandth of a percentage point), determined on the basis of the
offered rates for deposits in U.S. dollars for a period of time comparable to
the Interest Period applicable to such LIBOR Loan which are offered by four
major banks in the London interbank market at approximately 11:00 a.m. London
time, on the day that is two (2) LIBOR Business Days preceding the first day of
such LIBOR Loan as selected by the Agent. 
The principal London office of each of the four major London banks will
be requested to provide a quotation of its U.S. Dollar deposit offered
rate.  If at least two such quotations
are provided, the rate for that date will be the arithmetic mean of the
quotations.  If fewer than two
quotations are provided as requested, the rate for that date will be determined
on the basis of the rates quoted for loans in U.S. dollars to leading European
banks for a period of time comparable to the Interest Period applicable to such
LIBOR Loan offered by major banks in New York City at approximately 11:00 a.m.
New York City time, on the day that is two Business Days preceding the first
day of such Interest Period applicable to such LIBOR Loan.  In the event that the Agent is unable to
obtain any such quotation as provided above, it will be deemed that LIBOR
pursuant to a LIBOR Loan cannot be determined and §4.10 shall be
applicable.  In the event that the Board
of Governors of the Federal Reserve System shall impose a Eurocurrency Reserve
with respect to LIBOR deposits of Agent, then for any period during which such
Eurocurrency Reserve shall apply, LIBOR shall be equal to the amount determined
above divided by an amount equal to 1 minus the Eurocurrency Reserve Rate.

 

LIBOR Business Day.  Any day on which commercial banks are open
for international business (including dealings in Dollar deposits) in London,
England.

 

LIBOR Lending Office.  Initially, the office of each Lender
designated as such in Schedule 1.1 hereto; thereafter, such other
office of such Lender, if any, that shall be making or maintaining LIBOR Loans.

 

LIBOR Loans.  Loans bearing interest calculated by
reference to LIBOR.

 

LIBOR Prepayment Fee.  See §3.3(a).

 

7

 

Loan Documents.  This Agreement, the Notes, and any and all
other agreements, documents and instruments now or hereafter evidencing,
securing or otherwise relating to the Loans.

 

Loan Request.  See §2.5.

 

Loans.  The Loans made or to be made by the Lenders
to the Borrower pursuant to §2.

 

Majority Lenders.  As of any date, the Lenders whose aggregate
Facility Percentages constitute at least fifty-one percent (51%).

 

Material Adverse Effect.  A material adverse effect on (i) any of the
Real Estate, (ii) the business, results of operations or financial condition of
the Borrower and the Related Companies taken as a whole, (iii) the ability of
the Borrower to perform its obligations under the Loan Documents, or (iv) the
validity or enforceability of any of the Loan Documents or the remedies or
material rights of the Agent or the Lenders thereunder.

 

Maturity Date.  The earlier of (i) November 12, 2005 or
(ii) such date as the Secured Revolving Credit Agreement may be terminated and
the loans thereunder prepaid, or such earlier date on which the Loans shall
become due and payable pursuant to the terms hereof.

 

Multiemployer Plan.  Any multiemployer plan within the meaning of
§3(37) of ERISA maintained or contributed to by the Borrower or any ERISA
Affiliate.

 

Net Offering Proceeds.  All cash proceeds received after the Closing
Date by the Borrower, as a result of the sale of common, preferred or other
classes of stock of the Borrower less customary costs and discounts of issuance
paid by Borrower in connection therewith.

 

Net OP Proceeds.  All cash proceeds received and the fair
market value of all property contributed, after the Closing Date, as a result
of the issuance of any limited partnership interests, limited liability company
interests or other equity interests in any entity that is a Related Company
(such entities being sometimes called “operating partnerships”) less customary
costs and discounts of issuance paid by such operating partnership or Borrower
in connection therewith.

 

Net Operating Income.  With respect to any fiscal period of the
Borrower and with respect to any one or more of the Real Estate Assets, the
total rental and other income from the operation of such Real Estate Assets,
after deducting all expenses and other proper charges incurred by the Borrower
in connection with the operation of such Real Estate Assets during such fiscal
period, including, without limitation, real estate taxes and bad debt expenses,
but before payment or provision for debt service charges, income taxes, and
depreciation, amortization, and other non-cash expenses, all as determined in
accordance with Generally Accepted Accounting Principles except that there
shall be no rent leveling adjustments made when computing Net Operating Income.

 

Notes. 
See §2.2.

 

8

 

Obligations.  All indebtedness, obligations and
liabilities of the Borrower to any of the Lenders and the Agent, individually
or collectively, under this Agreement or any of the other Loan Documents or in
respect of any of the Loans or the Notes or other instruments at any time
evidencing any thereof, whether existing on the date of this Agreement or
arising or incurred hereafter, direct or indirect, joint or several, absolute
or contingent, matured or unmatured, liquidated or unliquidated, secured or
unsecured, arising by contract, operation of law of otherwise.

 

Outstanding.  With respect to the Loans, the aggregate
unpaid principal thereof as of any date of determination.

 

Outstanding Obligations.  As of any date of determination, the sum of
the outstanding principal amount of the Loans.

 

PBGC.  The Pension Benefit Guaranty Corporation
created by §4002 of ERISA and any successor entity or entities having similar
responsibilities.

 

Permitted Liens.  Liens, security interests and other
encumbrances permitted by §8.2.

 

Person.  Any individual, corporation, partnership,
trust, unincorporated association, business, or other legal entity, and any
government or any governmental agency or political subdivision thereof.

 

Prepayment Date.  See §3.3.

 

Prime Rate.  The variable per annum rate of interest
designated from time to time by FNB as its Prime Rate. The Prime Rate is a
reference rate and does not necessarily represent the lowest or best rate being
charged to any customer.  Changes in the
rate of interest resulting from changes in the Prime Rate shall take place
immediately without notice or demand of any kind. 

 

Prime Rate Loans.  Those Loans bearing interest calculated by
reference to the Prime Rate.

 

Properties.  All Real Estate Assets, Real Estate, and all
other assets, including, without limitation, intangibles and personalty owned
by the Borrower.

 

Real Estate.  All real property at any time owned, leased
(as lessee or sublessee) or operated by the Borrower, or any of the Related
Companies or any Controlled Unconsolidated Entity.

 

Real Estate Assets.  Those fixed and tangible properties consisting
of land, buildings and/or other improvements owned by the Borrower, by any of
the Related Companies or by any Controlled Unconsolidated Entity at the
relevant time of reference thereto, but excluding all leaseholds other than
leaseholds under ground leases having an unexpired term of 30 years.

 

Record.  The grid attached to any Note, or the
continuation of such grid, or any other similar record, including computer
records, maintained by any Lender with respect to any Loan referred to in such
Note.

 

9

 

Related Companies.  The entities listed and described on Schedule 1.3
hereto, or thereafter, any entity whose financial statements are consolidated
or combined with the Borrower’s pursuant to Generally Accepted Accounting
Principles, or any ERISA Affiliate.

 

Release.  See §6.18(c)(iii).

 

Reserve Amount.  With respect to any Real Estate Assets or
group of Real Estate Assets, a normalized annual reserve for capital
expenditures, replacement reserves and leasing costs at the rate of $0.25 per
year per square foot of net leasable area contained in all buildings on such
Real Estate Assets.

 

Responsible Officer.  With respect to the Borrower, any one of its
Chairman, President, Chief Executive Officer, Chief Financial Officer, or
Executive Vice Presidents or Vice Presidents.

 

Secured Revolving Credit Agreement.  The Revolving Credit Agreement dated
November 12, 2002 among the Borrower, FNB and other Lenders party thereto
and FNB as Agent, as amended by a First Amendment dated February 6, 2003,
and as further amended from time to time, pursuant to which FNB and other
Lenders party thereto have provided Borrower with a revolving line of credit in
the maximum principal amount of $42,000,000.

 

Subsidiary.  Any corporation, association, trust, or
other business entity of which the designated parent or other controlling
Person shall at any time own directly or indirectly through a Subsidiary or
Subsidiaries at least a majority (by number of votes) of the outstanding Voting
Interests.

 

Tangible Net Worth.  At any date, Borrower’s total assets,
adjusted to add back the accumulated depreciation of its real estate assets,
less its Intangible Assets, less its Total Liabilities, all as determined in
accordance with Generally Accepted Accounting Principals as determined as of
such date.  

 

Total Commitment.  The sum of the Commitments of the Lenders,
as in effect from time to time.

 

Total Liabilities.  The sum, without duplication of (i) all
consolidated liabilities of the Borrower determined in accordance with the
accounting principles used in the preparation of the financial statements
delivered pursuant to §7.4, including capital leases, accounts payable, accrued
expenses, mortgage payables, notes payable, senior notes, convertible
debentures, subordinated debentures, and secured or unsecured debt owed to
banks or other financial institutions, (ii) all Indebtedness of the Borrower
whether or not so classified, including, without limitation, all outstanding
Loans under this Agreement, (iii) the balance available for drawing under
letters of credit issued for the account of the Borrower and (iv) Borrower’s
Unconsolidated Entity Percentage of the Indebtedness of all Unconsolidated
Entities.

 

Type.  As to any Loan its nature as a Prime Rate
Loan or a LIBOR Loan.

 

Unconsolidated Entity.  As of any date, any Person in whom the
Borrower or any Related Company holds an Investment, and whose financial
results would not be consolidated under

 

10

 

Generally
Accepted Accounting Principles with the financial statements of the Borrower,
if such statements were prepared as of such date. Unconsolidated Entities
existing on the date hereof are set forth in Schedule 1.3.

 

Unconsolidated Entity Percentage.  With respect to any Unconsolidated Entity,
the percentage interest of the Borrower or any Related Company in such
Unconsolidated Entity which shall be the greatest of the following: (a) the
relative nominal direct and indirect ownership interest owned by Borrower or
any Related Company (expressed as a percentage) in such Unconsolidated Entity,
(b) the proportion (expressed as a percentage) of Borrower’s relative
contingent liability for the Indebtedness of such Unconsolidated Entity to that
entity’s total Indebtedness, or (c) the relative and indirect economic interest
owned by Borrower or any Related Company (calculated as a percentage) in such
Unconsolidated Entity determined in accordance with the applicable provisions
of the declaration of trust, articles or certificate of incorporation, articles
of organization, partnership agreement, limited liability operating agreement,
joint venture agreement or other applicable organizational document of such
Unconsolidated Entity.

 

Voting Interests.  Stock or similar ownership interests, of any
class or classes (however designated), the holders of which are at the time
entitled, as such holders, (a) to vote for the election of a majority of the
directors (or persons performing similar functions) of the corporation,
association, partnership, trust or other business entity involved, or (b) to
control, manage or conduct the business of the corporation, partnership,
association, trust or other business entity involved.

 

§1.2                          Rules of Interpretation.

 

(a)                                  A
reference to any document or agreement shall include such document or agreement
as amended, modified or supplemented from time to time in accordance with its
terms and the terms of this Agreement.

 

(b)                                 The
singular includes the plural and the plural includes the singular.

 

(c)                                  A
reference to any law includes any amendment or modification to such law.

 

(d)                                 A
reference to any Person includes its permitted successors and permitted
assigns.

 

(e)                                  Accounting
terms not otherwise defined herein have the meanings assigned to them by
Generally Accepted Accounting Principles applied on a consistent basis by the
accounting entity to which they refer and, except as otherwise expressly
stated, all use of accounting terms with respect to the Borrower shall reflect
the consolidation of the financial statements of Borrower and the Related
Companies.

 

(f)                                    The
words “include”, “includes” and “including” are not limiting.

 

11

 

(g)                                 All
terms not specifically defined herein or by Generally Accepted Accounting
Principles, which terms are defined in the Uniform Commercial Code as in effect
in Massachusetts, have the meanings assigned to them therein.

 

(h)                                 Reference
to a particular “§” refers to that section of this Agreement unless
otherwise indicated.

 

(i)                                     The
words “herein”, “hereof”, “hereunder” and words of like import shall refer to
this Agreement as a whole and not to any particular section or subdivision
of this Agreement.

 

(j)                                     The
words “so long as any Loan or Note is outstanding” shall mean so long as such
Loan or Note is not indefeasibly paid in full in cash.

 

§2.                               REVOLVING LOAN FACILITY.

 

§2.1                          Commitment to Lend.  Subject to the provisions of §2.5 and the other terms and
conditions set forth in this Agreement, each of the Lenders severally agrees to
lend to the Borrower and the Borrower may borrow, repay, and reborrow from time
to time between the Effective Date and the Maturity Date upon notice by the
Borrower to the Agent given and approved by the Agent in accordance with §2.5,
such sums as are requested by the Borrower up to a maximum aggregate principal
amount of Outstanding Obligations (after giving effect to all amounts
requested) at any one time equal to such Lender’s Commitment, provided that the
sum of the Outstanding Obligations (after giving effect to all amounts
requested) shall not at any time exceed the Total Commitment. The Loans shall
be made pro rata in accordance with each Lender’s Facility Percentage and the
Lenders shall at all times immediately adjust inter
se any inconsistency between each Lender’s outstanding principal
amount and each Lender’s Commitment. 
Each request for a Loan hereunder shall constitute a representation and
warranty by the Borrower that the conditions set forth in §10 or §11 (whichever
is applicable) have been satisfied in all material respects on the date of such
request and will be satisfied on the proposed Borrowing Date of the requested
Loan, provided that the making of such representation and warranty by Borrower
shall not limit the right of any Lender not to lend upon a determination by the
Majority Lenders that such conditions have not been satisfied.

 

§2.2                          The Notes.  The
Loans shall be evidenced by separate promissory notes of the Borrower in
substantially the form of Exhibit A hereto (each a “Note”), and completed with
appropriate insertions.  One or more
Notes shall be payable to the order of each Lender in an aggregate principal
amount equal to such Lender’s Commitment. The Borrower irrevocably authorizes
each Lender to make or cause to be made, at or about the time of the Borrowing
Date of any Loan or at the time of receipt of any payment of principal on such
Lender’s Note, an appropriate notation on such Lender’s Record reflecting the
making of such Loan or (as the case may be) the receipt of such payment. The
outstanding amount of the Loans set forth on such Lender’s Record shall (absent
manifest error) be prima facie evidence of the principal amount thereof owing
and unpaid to such Lender, but the failure to record, or any error in so
recording, any such amount on the Record shall not limit or otherwise affect
the obligations of the Borrower hereunder or under any Note to make payments of
principal of or interest on any Note when due. Upon receipt of an affidavit of
an officer of any Lender as to the loss, theft, destruction or

 

12

 

mutilation of its Note or any
other security document which is not of public record, and, in the case of any
such loss, theft, destruction or mutilation, upon cancellation of such Note or
other security document, Borrower will issue, in lieu thereof, a replacement
Note or other security document in the same principal amount thereof and
otherwise of like tenor.

 

§2.3                          Interest on Loans.

 

(a)                                  Each
Prime Rate Loan shall bear interest for the period commencing with the
Borrowing Date thereof and ending on the last day of the Interest Period with
respect thereto at the rate equal to 2.5% per annum above the Prime Rate.

 

(b)                                 Each
LIBOR Loan shall bear interest for the period commencing with the Borrowing
Date thereof and ending on the last day of the Interest Period with respect
thereto at the rate equal to 4.0% per annum above LIBOR determined for such
Interest Period.

 

(c)                                  The
Borrower unconditionally promises to pay interest on each Loan in arrears on
each Interest Payment Date with respect thereto.

 

§2.4                          Conversion Options.

 

(a)                                  The
Borrower may elect from time to time to convert any outstanding Loan to a Loan
of another Type, provided that (i) with respect to any such conversion of a
LIBOR Loan to a Prime Rate Loan, the Borrower shall give the Agent at least
three (3) Business Days, prior written notice of such election; (ii) with
respect to any such conversion of a LIBOR Loan into a Prime Rate Loan, such
conversion shall only be made on the last day of the Interest Period with
respect thereto; (iii) subject to the further proviso at the end of this
section and subject to §2.4(b) and §2.4(d) hereof with respect to any such
conversion of a Prime Rate Loan to a LIBOR Loan, the Borrower shall give the
Agent at least three (3) LIBOR Business Days, prior written notice of such
election and (iv) no Loan may be converted into a LIBOR Loan when any Default
or Event of Default has occurred and is continuing. On the date on which such
conversion is being made, each Lender shall take such action as is necessary to
transfer its Facility Percentage of such Loans to its Domestic Lending Office
or its LIBOR Lending Office, as the case may be. All or any part of outstanding
Loans of any Type may be converted as provided herein, provided further that
each Conversion Request relating to the conversion of a Prime Rate Loan to a
LIBOR Loan shall be for an amount equal to $5,000,000 or an integral multiple
of $1,000,000 in excess thereof and shall be irrevocable by the Borrower.

 

(b)                                 Any
Loans of any Type may be continued as such upon the expiration of an Interest
Period with respect thereto by compliance by the Borrower with the notice
provisions contained in §2.4(a); provided that no LIBOR Loan may be continued
as such when any Default or Event of Default has occurred and is continuing but
shall be automatically converted to a Prime Rate Loan on the last day of the
first Interest Period relating thereto ending during the continuance of any Default
or Event of Default of which the officers of the Agent active upon the
Borrower’s account have actual knowledge.

 

(c)                                  In
the event that the Borrower does not notify the Agent of its election hereunder
with respect to any Loan, such Loan shall be automatically converted to a Prime
Rate Loan at the end of the applicable Interest Period.

 

13

 

(d)                                 The
Borrower may not elect to convert a Prime Rate Loan to a LIBOR Loan pursuant to
§2.4(a) or elect to continue a LIBOR Loan pursuant to §2.4(b) if, after giving
effect thereto, there would be greater than five (5) LIBOR Loans
outstanding.  Any Loan Request for a
LIBOR Loan that would create greater than five (5) LIBOR Loans outstanding
shall be deemed to be a Conversion Request for a Prime Rate Loan.

 

§2.5                          Requests for Loans.  The Borrower shall give to the Agent written notice in the form
of Exhibit B hereto of each Loan requested hereunder (a “Loan Request”)
no less than (a) one (1) Business Day prior to the proposed Borrowing Date of
any Prime Rate Loan and (b) three (3) LIBOR Business Days prior to the proposed
Borrowing Date of any LIBOR Loan.  Each
such notice shall specify (i) the principal amount of the Loan requested, (ii)
the proposed Borrowing Date of such Loan, (iii) the Interest Period for such
Loan, and (iv) the Type of such Loan, and shall be accompanied by a Compliance
Certificate based on the most recent certificate deliver pursuant to §7.4(d)
with updated calculations evidencing compliance with the covenants contained in
§9.3 through §9.6 hereof after giving effect to such requested Loan.  Within one (1) Business Day after receipt of
a Loan Request, the Agent shall provide to each of the Lenders by facsimile a
copy of such Loan Request and accompanying Compliance Certificate and each
Lender shall, within 24 hours thereafter, notify the Agent if it believes that
any of the conditions contained in §11 of this Agreement has not been met or
waived.  If such a notice is given the
Majority Lenders shall promptly determine whether all of the conditions
contained in §11 of this Agreement have been met or waived.  If no such notice is given by any Lender or
if following such notice the Majority Lenders determine that the conditions
contained in §11 have been met or waived, each of the Lenders shall be
obligated to fund its Facility Percentage of the requested Loans.  Each such Loan Request shall be irrevocable
and binding on the Borrower and the Borrower shall be obligated to accept the
Loan requested from the Lenders on the proposed Borrowing Date.  Each Loan Request shall be in a minimum
aggregate amount of $5,000,000 or an integral multiple of $1,000,000 in excess
thereof.

 

§2.6                          Funds for Loans.

 

(a)                                  Subject
to §2.5 and the other provisions of this Agreement, not later than 11:00 a.m.
(Boston time) on the proposed Borrowing Date of any Loans, each of the Lenders
will make available to the Agent, at the Agent’s Head Office, in immediately
available funds, the amount of such Lender’s Facility Percentage of the amount
of the requested Loans.  Upon receipt
from each Lender of such amount, and upon receipt of the documents required by
§§10 or 11 (whichever is applicable) and the satisfaction of the other
conditions set forth therein, to the extent applicable, the Agent will make
available to the Borrower the aggregate amount of such Loans made available to
the Agent by the Lenders.  The failure
or refusal of any Lender to make available to the Agent at the aforesaid time
and place on any Borrowing Date the amount of its Facility Percentage of the
requested Loans shall not relieve any other Lender from its several obligation
hereunder to make available to the Agent the amount of such other Lender’s
Facility Percentage of any requested Loans but shall not obligate any other
Lender or Agent to fund more than its Facility Percentage of the requested
Loans or to increase its Facility Percentage. 

 

(b)                                 The
Agent may, unless notified to the contrary by any Lender prior to a Borrowing
Date, assume that such Lender has made available to the Agent on such Borrowing
Date the amount of such Lender’s Facility Percentage of the Loans to be made on
such

 

14

 

Borrowing Date, and the Agent
may (but it shall not be required to), in reliance upon such assumption, make
available to the Borrower a corresponding amount.  If any Lender makes available to the Agent such amount on a date
after such Borrowing Date, such Lender shall pay to the Agent on demand an
amount equal to the product of (i) the average computed for the period referred
to in clause (iii) below, of the weighted average interest rate paid by the
Agent for federal funds acquired by the Agent during each day included in such
period, times (ii) the amount of such Lender’s Facility Percentage of such
Loans, time (iii) a fraction, the numerator of which is the number of days or
portion thereof that elapsed from and including such Borrowing Date to the date
on which the amount of such Lender’s Commitment Percentage of such Loans shall
become immediately available to the Agent, and the denominator of which is
365.  A statement of the Agent submitted
to such Lender with respect to any amounts owing under this paragraph shall be
prima facie evidence of the amount due and owing to the Agent by such
Lender.  If such Lender does not pay
such corresponding amount upon the Agent’s demand therefor, the Agent will
promptly notify the Borrower, and the Borrower shall promptly pay such
corresponding amount to the Agent.  The
Agent shall also be entitled to recover from the Borrower interest on such
corresponding amount in respect of each day from the date such corresponding
amount was made available by the Agent to the Borrower to the date such
corresponding amount is recovered by the Agent at a per annum rate equal to the
applicable rate for such Loan.

 

§3.                               REPAYMENT OF THE LOANS.

 

§3.1                          Maturity.  The
Borrower unconditionally promises to pay on the Maturity Date, and there shall
become absolutely due and payable on the Maturity Date, all of the Loans
outstanding on such date, together with any and all accrued and unpaid interest
and charges thereon.

 

§3.2                          Mandatory Repayments of Loan.  If at any time the sum of the Outstanding
Obligations exceeds the Total Commitment, then the Borrower shall immediately
pay the amount of such excess to the Agent for the respective accounts of the
Lenders for application to the Loans. 
Borrower further covenants and agrees that, notwithstanding anything to
the contrary contained herein (if anything), at least one (1) time during each
calendar year during the term of this Agreement, Borrower shall repay all
outstanding Loans (and accrued and unpaid interest thereon and other amounts
payable hereunder (including all amount payable in connection with such
prepayment)) such that there shall be a zero balance hereunder and Borrower
shall maintain such zero balance for a period of not less than thirty (30) days
from the date of such prepayment.

 

§3.3                          Optional Repayments of Loans.  The Borrower shall have the right, at its election,
to repay the outstanding amount of the Loans, as a whole or in part, on any
Business Day, without penalty or premium; provided that the full or partial
prepayment of the outstanding amount of any LIBOR Loans made pursuant to this
§3.3 may be made only on the last day of the Interest Period relating thereto,
except as set forth below in this §3.3. The Borrower shall give the Agent no
later than 10:00 a.m., Boston time, at least two (2) Business Days’ prior
written notice of any prepayment pursuant to this §3.3 of any Prime Rate Loans
and four (4) LIBOR Business Days, notice of any proposed repayment pursuant to
this §3.3 of any LIBOR Loans, specifying the proposed date of payment of Loans
and the principal amount to be paid. 
The Agent shall promptly notify each Lender of the principal amount of
such payment to be received

 

15

 

by such Lender. Each such partial prepayment of the
Loans shall be in an integral multiple of $1,000,000 and, to the extent
requested by the Agent, shall be accompanied by the payment of all charges
outstanding on all Loans and of accrued interest on the principal repaid to the
date of payment. The principal payments so received shall be applied first to
the principal of Prime Rate Loans and then to the principal of LIBOR
Loans.  Notwithstanding anything
contained herein to the contrary, the Borrower may make a full or partial
prepayment of a LIBOR Loan on a date other than the last day of the Interest
Period relating thereto, if all optional prepayments (in whole or in part) on
such Loans shall be accompanied by, and the Borrower hereby promises to pay, a
prepayment fee in an amount determined by the Agent in the following manner:

 

(a)                                  LIBOR
Prepayment Fee.  Borrower acknowledges
that prepayment or acceleration of a LIBOR Loan during an Interest Period shall
result in the Lenders incurring additional costs, expenses and/or liabilities
and that it is extremely difficult and impractical to ascertain the extent of
such costs, expenses and/or liabilities. 
(For all purposes of this Section, any Loan not being made as a LIBOR
Loan in accordance with the Loan Request or Conversion Request therefor, as a
result of Borrower’s cancellation thereof, shall be treated as if such LIBOR
Loan had been prepaid.)  Therefore, on
the date a LIBOR Loan is prepaid or the date all sums payable hereunder become
due and payable, by acceleration or otherwise (“Prepayment Date”), Borrower
will pay to Agent, for the account of each Lender, (in addition to all other
sums then owing), an amount (“LIBOR Prepayment Fee”) determined by the Agent as
follows: The current rate for United States Treasury securities (bills on a
discounted basis shall be converted to a bond equivalent) with a maturity date
closest to the end of the Interest Period as to which prepayment is made, shall
be subtracted from the interest rate applicable to the LIBOR Loan being
prepaid.  If the result is zero or a
negative number, there shall be no LIBOR Prepayment Fee.  If the result is a positive number, then the
resulting percentage shall be multiplied by the amount of the prepayment of the
LIBOR Loan.  The resulting amount shall
be divided by 360 and multiplied by the number of days remaining in the
Interest Period as to which the prepayment is being made. The resulting amount
shall be the LIBOR Prepayment Fee.

 

(b)                                 Upon
the written notice to Borrower from Agent, Borrower shall immediately pay to
Agent, for the account of the Lenders, the LIBOR Prepayment Fee.  Such written notice (which shall include
calculations in reasonable detail) shall, in the absence of manifest error, be
conclusive and binding on the parties hereto.

 

(c)                                  Borrower
understands, agrees and acknowledges the following:  (i) no Lender has any obligation to purchase, sell and/or
match funds in connection with the use of the LIBOR Rate as a basis for
calculating the rate of interest on a LIBOR Loan; (ii) the LIBOR Rate is
used merely as a reference in determining such rate; and (iii) Borrower
has accepted the LIBOR Rate as a reasonable and fair basis for calculating such
rate and a LIBOR Prepayment Fee. 
Borrower further agrees to pay the LIBOR Prepayment Fee, if any, whether
or not a Lender elects to purchase, sell and/or match funds.

 

§4.                               CERTAIN GENERAL PROVISIONS.

 

§4.1                          Facility Fees. 
On the Closing Date, and on other dates specified in the Agreement
Regarding Fees, the Borrower shall pay to FNB the fees with respect to the Loan
in the amounts

 

16

 

specified in the Agreement Regarding Fees.  All such fees shall be fully earned when
paid and nonrefundable under any circumstances.

 

§4.2                          Unused Fee. 
The Borrower shall pay to the Agent for the accounts of the Lenders in
accordance with their respective Facility Percentages an Unused Fee calculated
at the rate of 0.75% per annum on the daily amount by which the Total
Commitment exceeds the Outstanding Obligations for each calendar month.  The Unused Fee shall be payable monthly in
arrears on or before the third Business Day of each calendar month for the
immediately preceding calendar month commencing on the first such date
following the date hereof, with a final payment on the Maturity Date or any
earlier date on which the Commitments shall terminate.

 

§4.3                          Funds for Payments.

 

(a)                                  All
payments of principal, interest, closing fees, commitment fees and any other
amounts due hereunder (other than as provided in §4.1, §4.5 and §4.6) or under
any of the other Loan Documents, and all prepayments, shall be made to the
Agent, for the respective accounts of the Lenders, at the Agent’s Head Office,
in each case in Dollars in immediately available funds.

 

(b)                                 All
payments by the Borrower hereunder and under any of the other Loan Documents
shall be made without setoff or counterclaim and free and clear of and without
deduction for any taxes, levies, imposts, duties, charges, fees, deductions,
withholdings, compulsory liens, restrictions or conditions of any nature now or
hereafter imposed or levied by any jurisdiction or any political subdivision
thereof or taxing or other authority therein unless the Borrower is compelled
by law to make such deduction or withholding. 
If any such obligation is imposed upon the Borrower with respect to any
amount payable by it hereunder or under any of the other Loan Documents, the
Borrower shall pay to the Agent, for the account of the Lenders or (as the case
may be) the Agent, on the date on which such amount is due and payable
hereunder or under such other Loan Document, such additional amount in Dollars
as shall be necessary to enable the Lenders or the Agent to receive the same
net amount which the Lenders or the Agent would have received on such due date
had no such obligation been imposed upon the Borrower. The Borrower will
deliver promptly to the Agent certificates or other valid vouchers for all
taxes or other charges deducted from or paid with respect to payments made by
the Borrower hereunder or under such other Loan Document.

 

§4.4                          Computations. 
All computations of interest on the Loans and of other fees to the
extent applicable shall be made on the basis of 360-day year and the actual
number of days elapsed. Except as otherwise provided in the definition of the
term “Interest Period” with respect to LIBOR Loans, whenever a payment
hereunder or under any of the other Loan Documents becomes due on a day that is
not a Business Day, the due date for such payment shall be extended to the next
succeeding Business Day, and such extension of time shall be included in
computing interest and fees in connection with such payment. The outstanding
amount of the Loans as reflected on the Records from time to time shall (absent
manifest error) be considered correct and binding on the Borrower unless within
thirty (30) Business Days after receipt by the Agent or any of the Lenders from
Borrower of any notice by the Borrower of such outstanding amount, the Agent or
such Lender shall notify the Borrower to the contrary.

 

17

 

§4.5                          Additional Costs, Etc.  If any present or future applicable law
(which expression, as used herein, includes statutes, rules and regulations
thereunder and interpretations thereof by any competent court or by any
governmental or other regulatory body or official charged with the
administration or the interpretation thereof and requests, directives,
instructions and notices at any time or from time to time hereafter made upon
or otherwise issued to any Lender or the Agent by any central bank or other
fiscal, monetary or other authority, whether or not having the force of law),
shall:

 

(a)                                  subject
any Lender or the Agent to any tax, levy, impost, duty, charge, fee, deduction
or withholding of any nature with respect to this Agreement, the other Loan
Documents, such Lender’s Commitment or the Loans (other than taxes based upon
or measured by the income or profits of such Lender or the Agent), or

 

(b)                                 materially
change the basis of taxation (except for changes in taxes on income or profits)
of payments to any Lender of the principal of or the interest on any Loans or
any other amounts payable to any Lender under this Agreement or the other Loan
Documents, or

 

(c)                                  impose
or increase or render applicable (other than to the extent specifically
provided for elsewhere in this Agreement) any special deposit, reserve,
assessment, liquidity, capital adequacy or other similar requirements (whether
or not having the force of law) against assets held by, or deposits in or for
the account of, or Loans by, or commitments of an office of any Lender, or

 

(d)                                 impose
on any Lender any other conditions or requirements with respect to this
Agreement, the other Loan Documents, the Loans, the Commitment, or any class of
Loans or commitments of which any of the Loans or the Commitment forms a part;

 

and the result of any of the foregoing is

 

(i)                                     to
increase the cost to such Lender of making, funding, issuing, renewing,
extending or maintaining any of the Loans or such Lender’s Commitment, or

 

(ii)                                  to
reduce the amount of principal, interest or other amount payable to such Lender
or the Agent hereunder on account of the Commitments or any of the Loans, or

 

(iii)                               to
require such Lender or the Agent to make any payment or to forego any interest
or other sum payable hereunder, the amount of which payment or foregone
interest or other sum is calculated by reference to the gross amount of any sum
receivable or deemed received by such Lender or the Agent from the Borrower
hereunder,

 

then, and in each such case, the Borrower
will, upon demand made by such Lender or (as the case may be) the Agent at any
time and from time to time and as often as the occasion therefor may arise, pay
to such Lender or the Agent, to the extent permitted by law, such additional
amounts as will be sufficient to compensate such Lender or the Agent for such
additional cost, reduction, payment or foregone interest or other sum.

 

§4.6                          Capital Adequacy.  If any present or future law, governmental rule, regulation,
policy, guideline or directive (whether or not having the force of law) or the
interpretation

 

18

 

thereof by a court or governmental authority with
appropriate jurisdiction affects the amount of capital required or expected to
be maintained by banks or bank holding companies and any Lender or the Agent
determines that the amount of capital required to be maintained by it is
increased by or based upon the existence of the Loans made or deemed to be made
pursuant hereto, then such Lender or the Agent may notify the Borrower of such
fact, and the Borrower shall pay to such Lender or the Agent from time to time
on demand, as an additional fee payable hereunder, such amount as such Lender
or the Agent shall determine in good faith and certify in a notice to the
Borrower to be an amount that will adequately compensate such Lender or the
Agent in light of these circumstances for its increased costs of maintaining
such capital. Each Lender and the Agent shall allocate such cost increases
among its customers in good faith and on an equitable basis.

 

§4.7                          Certificate. 
A certificate setting forth any additional amounts payable pursuant to
§§4.5 or 4.6 and a brief explanation of such amounts which are due, submitted
by any Lender or the Agent to the Borrower, shall be prima facie evidence that
such amounts are due and owing.

 

§4.8                          Indemnity.  In
addition to the other provisions of this Agreement regarding any such matters,
the Borrower agrees to indemnify each Lender and to hold each Lender harmless
from and against any loss, cost or reasonable expense (including loss of anticipated
profits) that such Lender may sustain or incur as a consequence of (a) a
default by the Borrower in payment of the principal amount of or any interest
on any LIBOR Loans as and when due and payable, including any such loss or
expense caused by Borrower’s breach or other default and arising from interest
or fees payable by such Lender to lenders of funds obtained by it in order to
maintain its LIBOR Loans, (b) a default by the Borrower in making a borrowing
or conversion after the Borrower has given (or is deemed to have given) a Loan
Request or a Conversion Request, (c) the making of any payment of a LIBOR Loan
or the making of any conversion of a LIBOR Loan to a Prime Rate Loan on a day
that is not the last day of the applicable Interest Period with respect
thereto, including interest or fees payable by such Lender to lenders of funds
obtained by it in order to maintain any such LIBOR Loan and (d) any failure by
the Borrower to prepay a LIBOR Loan on the date specified in a prepayment
notice given by the Borrower.

 

§4.9                          Default Interest and Late Charges.  During any period when an Event of Default
has occurred and is continuing, or after the Maturity Date or after judgment
has been rendered on any Note, Borrower’s right to select LIBOR Loans shall
cease and the unpaid principal of all Loans shall, at the option of each Lender
bear interest at a rate which is four (4) percentage points per annum greater
than that which would otherwise be applicable to Prime Rate Loans. If the
entire amount of any required principal and/or interest is not paid in full
within ten (10) days after the same is due, Borrower shall pay to the Agent a
late fee equal to five percent (5%) of the required payment.

 

§4.10                    Inability
to Determine LIBOR Rate. 
In the event, prior to the commencement of any Interest Period relating
to any LIBOR Loan, the Agent shall reasonably determine that adequate and
reasonable methods do not exist for ascertaining the LIBOR Rate that would
otherwise determine the rate of interest to be applicable to any LIBOR Loan
during any Interest Period, the Agent shall forthwith give notice of such
determination (which shall be conclusive and binding on the Borrower) to the
Borrower. In such event (a) any Loan Request or Conversion Request with respect
to LIBOR Loans shall be automatically withdrawn and shall be 

 

19

 

deemed a request for Prime Rate Loans, (b) each LIBOR
Loan will automatically, on the last day of the then current Interest Period
thereof, become a Prime Rate Loan, and (c) the obligations of the Lenders to
make LIBOR Loans shall be suspended until the Agent reasonably determines that
the circumstances giving rise to such suspension no longer exist, whereupon the
Agent shall so notify the Borrower.

 

§4.11                    Illegality.  Notwithstanding any other provisions herein,
if any present or future law, regulation, treaty or directive or in the
interpretation or application thereof shall make it unlawful for any Lender to
make or maintain LIBOR Loans, such Lender shall forthwith give notice of such
circumstances to the Borrower and thereupon (a) the Commitment of such Lender
to make LIBOR Loans or convert Loans of another Type to LIBOR Loans shall
forthwith be suspended and (b) the LIBOR Loans then outstanding shall be
converted automatically to Prime Rate Loans on the last day of each Interest
Period applicable to such LIBOR Loans or within such earlier period as may be
required by law. The Borrower hereby agrees promptly to pay to the Agent for
the account of such Lender, upon demand, any additional amounts necessary to
compensate such Lender for any costs incurred by such Lender in making any
conversion in accordance with this §4.11, including any interest or fees
payable by such Lender to lenders of funds obtained by it in order to make or
maintain its LIBOR Loans hereunder. If, at any time, the rate of interest,
together with all amounts which constitute interest and which are reserved,
charged or taken by the Lenders as compensation for fees, services or expenses incidental
to the making, negotiating or collection of the Loans or the other Obligations,
shall be deemed by any competent court of law, governmental agency or tribunal
to exceed the maximum rate of interest permitted to be charged by any Lender to
Borrower under applicable law, then, during such time as such rate of interest
would be deemed excessive, that portion of each sum paid attributable to that
portion of such interest rate that exceeds the maximum rate of interest so
permitted shall be deemed a voluntary prepayment of principal without penalty
(including, without limitation, prepayment fees required pursuant to §3.3(a)
hereof).  As used herein, the term
“applicable law” shall mean the law in effect as of the date hereof, provided,
however, that in the event there is a change in the law which results in a
higher permissible rate of interest, then this Agreement and the Notes shall be
governed by such new law as of its effective date.

 

§4.12                    Replacement
of Lenders.  If any of the
Lenders shall make a notice or demand upon the Borrower pursuant to §4.5, §4.6,
or §4.11 based on circumstances or laws which are not generally applicable to
the Lenders organized under the laws of the United States or any State thereof,
the Borrower shall have the right to replace such Lender with an Eligible
Assignee selected by the Borrower and approved by the Agent.  In such event the assignment shall take
place on a date set by the Agent at which time the assigning Lender and the Eligible
Assignee shall enter into an Assignment and Acceptance as contemplated by §18.1
(and clause (d) thereof shall not be applicable) and the assigning Lender shall
receive from the Eligible Assignee a sum equal to the outstanding principal
amount of the Loans owed to the assigning Lender together with accrued interest
thereon plus all other amounts then due to the assigning Lender hereunder.

 

§4.13                    Limitation
on Interest.  Notwithstanding
anything in this Agreement to the contrary, all agreements between the Borrower
and the Lenders and the Agent, whether now existing or hereafter arising and
whether written or oral, are hereby limited so that in no contingency, whether
by reason of acceleration of the maturity of any of the Obligations or
otherwise, shall the interest contracted for, charged or received by the
Lenders exceed the

 

20

 

maximum amount permissible under applicable law.  If, from any circumstance whatsoever,
interest would otherwise by payable to the Lenders in excess of the maximum lawful
amount, the interest payable to the Lenders shall be reduced to the maximum
amount permitted under applicable law; and if from any circumstance the Lenders
shall ever receive anything of value deemed interest by applicable law in
excess of the maximum lawful amount, an amount equal to any excessive interest
shall be applied to the reduction of the principal balance of the Obligations
and to the payment of interest or, if such excessive interest exceeds the
unpaid balance of principal of the Obligations, such excess shall be refunded
to the Borrower.  All interest paid or
agreed to be paid to the Lenders shall, to the extent permitted by applicable
law, be amortized, prorated, allocated and spread throughout the full period
until payment in full of the principal of the Obligations (including the period
of any renewal or extension thereof) so that the interest thereon for such full
period shall not exceed the maximum amount permitted by applicable law.  This section shall control all
agreements between the Borrower and the Lenders and the Agent. 

 

§5.                               NO LIMITATION ON RECOURSE.

 

§5.1                          [Intentionally Omitted.]

 

§5.2                          No Limitation on Recourse.  The Obligations are full recourse obligations of the Borrower and
all of its Real Estate Assets and other properties and assets shall be
available for the indefeasible payment in full in cash and performance of the
Obligations.

 

§6.                               REPRESENTATIONS AND WARRANTIES.  The Borrower represents and warrants to the
Agent and each of the Lenders as of the Closing Date and as of the date of each
Loan hereunder as follows.

 

§6.1                          Authority; Etc.

 

(a)                                  Organization;
Good Standing.  The Borrower (i) is
a Maryland corporation duly organized, validly existing and in good standing
under the laws of the State of Maryland, (ii) has all requisite power to own
its properties and conduct its business as now conducted and as presently
contemplated, and (iii) to the extent required by law is in good standing as a
foreign entity and is duly authorized to do business in the State of Colorado
and in each other jurisdiction where such qualification is necessary except
where a failure to be so qualified in such other jurisdiction would not have a
Material Adverse Effect. Each Related Company is a corporation, partnership or
limited liability company duly organized, validly existing and in good standing
under the laws of the State of its formation, has all requisite power to own
its properties and conduct its business as presently contemplated and is duly
authorized to do business in the State in which the property owned by it is
located and in each other jurisdiction where such qualification is necessary.

 

(b)                                 Authorization.  The execution, delivery and performance of
this Agreement and the other Loan Documents to which the Borrower is to become
a party and the transactions contemplated hereby and thereby (i) are within the
authority of the Borrower, (ii) have been duly authorized by all necessary
proceedings on the part of the Borrower, (iii) do not conflict with or result
in any breach or contravention of any provision of law, statute, rule or
regulation to which the Borrower is subject or any judgment, order, writ,
injunction, license or

 

21

 

permit applicable to the Borrower and (iv) do not
conflict with any provision of its charter documents or bylaws of, or any
agreement or other instrument binding upon, the Borrower or to which any of its
properties are subject.

 

(c)                                  Enforceability.  Assuming due authorization, execution and
delivery by all other parties thereto, the execution and delivery of this
Agreement and the other Loan Documents to which the Borrower is or is to become
a party will result in valid and legally binding obligations of the Borrower
enforceable against it in accordance with the respective terms and provisions
hereof and thereof, except as enforceability is limited by bankruptcy,
insolvency, reorganization, moratorium or other laws relating to or affecting
generally the enforcement of creditors’ rights and except to the extent that availability
of the remedy of specific performance or injunctive relief is subject to the
discretion of the court before which any proceeding therefor may be brought.

 

§6.2                          Governmental Approvals.  The execution, delivery and performance by
the Borrower of this Agreement and the other Loan Documents to which the
Borrower is or is to become a party and the transactions contemplated hereby
and thereby do not require the approval or consent of, or filing with, any
governmental agency or authority other than those already obtained.

 

§6.3                          Title to Properties; Leases.

 

(a)                                  Each
Related Company holds good and clear record and marketable (or indefeasible,
with respect to Real Estate located in Texas) fee simple or leasehold title, as
applicable, to the Real Estate, subject to no rights of others, including any
mortgages, conditional sales agreements, title retention agreements, liens or
encumbrances except for the Permitted Liens.

 

(b)                                 Except
as indicated on Schedule 6.3 hereto, the Borrower owns all of the
properties reflected in the balance sheet of the Borrower as of the Balance
Sheet Date or acquired since that date (except properties sold or otherwise
disposed of in the ordinary course of business since that date), subject to no
rights of others, including any mortgages, leases, conditional sales
agreements, title retention agreements, liens or other encumbrances except
Permitted Liens.

 

§6.4                          Financial Statements.  The following financial statements have been
furnished to each of the Lenders.

 

(a)                                  A
balance sheet of the Borrower as of the Balance Sheet Date, and a statement of
income, statement of changes in shareholders’ equity and statement of cash
flows for the fiscal year then ended, accompanied by an auditor’s report
prepared without qualification. Such balance sheet and statements of income, of
changes in shareholders’ equity and of cash flows have been prepared in
accordance with Generally Accepted Accounting Principles and fairly present the
financial condition of the Borrower in all material respects as of the close of
business on the date thereof and the results of operations, changes in
shareholders’ equity and cash flows for the fiscal year then ended. There are
no contingent liabilities of the Borrower as of such date involving material
amounts, known to the officers of the Borrower not disclosed in said balance
sheet and the related notes thereto.

 

22

 

(b)                                 A
balance sheet and a statement of income, statement of changes in shareholders,
equity and statement of cash flows of the Borrower for each of the fiscal
quarters of the Borrower ended since the Balance Sheet Date certified by
Borrower’s chief financial officer to have been prepared in accordance with
Generally Accepted Accounting Principles consistent with those used in the
preparation of the annual audited statements delivered pursuant to paragraph
(a) above and to fairly present the financial condition of the Borrower in all
material respects as of the close of business on the dates thereof and the
results of operations, of changes in shareholders’ equity and of cash flows for
the fiscal quarters then ended (subject to year-end adjustments). There are no
contingent liabilities of the Borrower as of such dates involving material
amounts, known to the officers of the Borrower, not disclosed in such balance
sheets and the related notes thereto.

 

§6.5                          No Material Changes.  Since the Balance Sheet Date, there has
occurred no material adverse change in the financial condition or assets or
business of the Borrower as shown on or reflected in the balance sheet of the
Borrower as of the Balance Sheet Date, or the statement of income for the
fiscal year then ended, other than changes in the ordinary course of business
that have not had a Material Adverse Effect.

 

§6.6                          Franchises, Patents, Copyrights, Etc.  The Borrower possesses (either directly or
through the Related Companies) all franchises, patents, copyrights, trademarks,
trade names, licenses and permits, and rights in respect of the foregoing,
adequate for the conduct of its business substantially as now conducted without
known conflict with any rights of others, including all Permits.

 

§6.7                          Litigation. 
Except as listed and described on Schedule 6.7 hereto, there
are no actions, suits, proceedings or investigations of any kind pending or, to
Borrower’s knowledge, threatened against the Borrower or any of the Related
Companies before any court, tribunal or administrative agency or board that, if
adversely determined, might, either in any case or in the aggregate, have a
Material Adverse Effect or materially impair the right of the Borrower or any
of the Related Companies to carry on business substantially as now conducted by
it, or result in any material liability not adequately covered by insurance, or
for which adequate reserves are not maintained on the balance sheet of the
Borrower.

 

§6.8                          No Materially Adverse Contracts, Etc.  The Borrower is not subject to any charter,
trust or other legal restriction, or any judgment, decree, order, rule or
regulation that has or is expected in the future to have a Material Adverse
Effect. The Borrower is not a party to any contract or agreement that has or is
expected, in the judgment of the Borrower’s officers, to have a Material
Adverse Effect. None of the Related Companies is subject to any charter, trust
or other legal restriction, or any judgment, decree, order, rule or regulation
that has or is expected in the future, in the judgment of the Borrower’s
officers, to have a Material Adverse Effect. None of the Related Companies is a
party to any contract or agreement that has or is expected, in the judgment of
the Borrower’s officers, to have any Material Adverse Effect.

 

§6.9                          Compliance With Other Instruments, Laws, Etc.  Neither the Borrower nor any Related Company
is in violation of any provision of its charter documents, by-laws, or any
agreement or instrument to which it may be subject or by which it or any of its
properties may be

 

23

 

bound or any decree, order, judgment, statute,
license, rule or regulation, in any of the foregoing cases in a manner that
could have a Material Adverse Effect.

 

§6.10                    Tax Status.  The Borrower (a) has made or filed all
federal and state income and all other tax returns, reports and declarations
required by any jurisdiction to which it is subject, (b) has paid all taxes and
other governmental assessments and charges shown or determined to be due on
such returns, reports and declarations, except those being contested in good
faith and by appropriate proceedings, and (c) has set aside on its books
reserves reasonably adequate for the payment of all taxes for periods
subsequent to the periods to which such returns, reports or declarations
apply.  There are no delinquent taxes in
any material amount claimed to be due by the taxing authority of any
jurisdiction, and the officers of the Borrower know of no basis for any such
claim.

 

§6.11                    Event of
Default.  No Default or Event of
Default has occurred and is continuing.

 

§6.12                    Investment
Company Act.  Neither the
Borrower nor any Related Company is an “investment company”, or an “affiliated
company” or a “principal underwriter” of an “investment company”, as such terms
are defined in the Investment Company Act of 1940.

 

§6.13                    Absence
of Financing Statements, Etc. 
There is no financing statement, security agreement, chattel mortgage,
real estate mortgage, equipment lease, financing lease, option, encumbrance or
other document existing, filed or recorded with any filing records, registry,
or other public office, that purports to cover, affect or give notice of any
present or possible future lien or encumbrance on, or security interest in, any
property of the Borrower, except Permitted Liens.

 

§6.14                    [Intentionally
Omitted.]

 

§6.15                    Certain
Transactions.  Except as set
forth on Schedule 6.15 hereto, none of the officers or employees of
the Borrower is presently a party to any transaction with the Borrower or any
Related Company (other than for services as employees, officers and trustees),
including any contract, agreement or other arrangement providing for the
furnishing of services to or by, providing for rental of real or personal
property to or from, or otherwise requiring payments to or from any officer,
trustee or such employee or, to the knowledge of the Borrower, any corporation,
partnership, trust or other entity in which any officer, trustee or any such
employee or natural Person related to such officer, trustee or employee or
other Person in which such officer, trustee or employee has a direct or indirect
beneficial interest has a substantial interest or is an officer or trustee.

 

§6.16                    Benefit
Plans; Multiemployer Plans; Guaranteed Pension Plans.  As of the date hereof as to any
Multiemployer Plan or Guaranteed Pension Plan, neither the Borrower nor any
ERISA Affiliate maintains or contributes to any Multiemployer Plan or
Guaranteed Pension Plan. To the extent that Borrower or any ERISA Affiliate
hereafter maintains or contributes to any Employee Benefit Plan or Guaranteed
Pension Plan, it shall at all times do so in compliance with §7.20 hereof.

 

§6.17                    Regulations
U and X.  No portion of
any Loan shall be used, in whole or in part, for the purpose of purchasing or
carrying any “margin security” or “margin stock” as such terms

 

24

 

are used in Regulations U and X of the Board of
Governors of the Federal Reserve System, 12 C.F.R. Parts 221 and 224.

 

§6.18                    Environmental
Compliance.  To the best of
Borrower’s knowledge, Borrower makes the following representations and
warranties:

 

(a)                                  Except
as may be set forth on Schedule 6.18 attached hereto, none of the
Borrower, any of the Related Companies or any operator of the Real Estate or
any portion thereof, or any operations thereon is in violation, or alleged
material violation, of any judgment, decree, order, law, license, rule or
regulation pertaining to environmental matters (hereinafter collectively
referred to as the “Environmental Laws”), including without limitation, those
arising under the Resource Conservation and Recovery Act (“RCRA”), the
Comprehensive Environmental Response, Compensation and Liability Act of 1980 as
amended (“CERCLA”), the Superfund Amendments and Reauthorization Act of 1986
(“SARA”), the Federal Clean Water Act, the Federal Clean Air Act, the Toxic
Substances Control Act, or any state or local statute, regulation, ordinance,
order or decree relating to health, safety or the environment, including,
without limitation, the environmental statutes, regulations, orders and decrees
of the States in which any of the Real Estate may be located, which violation
involves the Real Estate or would have a Material Adverse Effect.

 

(b)                                 Except
as set forth on Schedule 6.18 attached hereto, none of the Borrower
or the Related Companies has received written notice from any third party
including, without limitation any federal, state or local governmental
authority, (i) that it has been identified by the United States Environmental
Protection Agency (“EPA”) as a potentially responsible party under CERCLA with
respect to a site listed on the National Priorities List, 40 C.F.R. Part 300
Appendix B (1986) ; (ii) that any hazardous waste, as defined by 42 U.S.C.
§9601(5), any hazardous substances as defined by 42 U.S.C. §9601(14), any
pollutant or contaminant as defined by 42 U.S.C. §9601(33) or any toxic
substances, oil or hazardous materials or other chemicals or substances
regulated by any Environmental Laws (“Hazardous Materials”) which it has
generated, transported or disposed of have been found at any site at which a
federal, state or local agency or other third party has conducted or has
ordered that the Borrower or any of the Related Companies conduct a remedial
investigation, removal or other response action pursuant to any Environmental
Law; or (iii) that it is or shall be a named party to any claim, action, cause
of action, complaint, or legal or administrative proceeding (in each case,
contingent or otherwise) arising out of any third party’s incurrence of costs,
expenses, losses or damages of any kind whatsoever in connection with the
release of Hazardous Materials.

 

(c)                                  Except
as set forth on Schedule 6.18 attached hereto, (i) no portion of
the Real Estate has been used for the handling, processing, storage or disposal
of Hazardous Materials except in material compliance with applicable
Environmental Laws; and except as set forth on Schedule 6.18, no
underground tank or other underground storage receptacle for Hazardous
Materials is located on any portion of the Real Estate; (ii) in the course of
any activities conducted by the Borrower, any of the Related Companies or the
operators of the Real Estate, no Hazardous Materials have been generated or are
being used on the Real Estate except in material compliance with applicable
Environmental Laws; (iii) there has been no present, or to the best of
Borrower’s knowledge past, releasing, spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, disposing or dumping (a
“Release”) or threatened

 

25

 

Release of Hazardous Materials on, upon, into or from
the Real Estate; (iv) to the best of Borrower’s knowledge, there have been no
Releases on, upon, from or into any real property in the vicinity of any of the
Real Estate which, through soil or groundwater contamination, may have come to
be located on, and which would have a material adverse effect on the value of,
such Real Estate; and (v) to the best of Borrower’s knowledge, any Hazardous
Materials that have been generated on any of the Real Estate have been
transported off-site only by carriers having an identification number issued by
the EPA, treated or disposed of only by treatment or disposal facilities
maintaining valid permits as required under applicable Environmental Laws, which
transporters and facilities have been and are, to the best of the Borrower’s
knowledge, operating in material compliance with such permits and applicable
Environmental Laws. Notwithstanding that any representation contained herein
may be limited to the knowledge of the Borrower, any such limitation shall not
affect the covenants specified in §7.10 or elsewhere in this Agreement.

 

§6.19                    Subsidiaries
and Affiliates.  The Borrower
has no Subsidiaries except for the Related Companies listed on Schedule 1.3.
The Borrower is not a partner in any partnership and is not a member of any
limited liability company, other than the Unconsolidated Entities listed on Schedule 1.3.

 

§6.20                    Leases.  Upon request from Agent the Borrower will
deliver to the Agent a rent roll for each parcel of Real Estate which shall
accurately and completely sets forth all relevant information with respect to
the leases, the rents payable by tenants, and a description of any tenant
improvements or work to be done, furnished or paid for by the landlord, or
credited or allowed to a tenant.

 

§6.21                    Loan
Documents.  All of the
representations and warranties of the Borrower made in the other Loan Documents
or any document or instrument delivered or to be delivered to the Agent or the
Lenders pursuant to or in connection with any of such Loan Documents are true
and correct in all material respects.

 

§6.22                    Property.  All of the Borrower’s, the Related
Companies’ and the Controlled Unconsolidated Entities’ properties are in good
repair and condition, subject to ordinary wear and tear.  The Borrower has completed or caused to be
completed an appropriate investigation of the environmental condition of each
such property as of the later of the date of the Borrower’s, the Related
Companies’ or the Controlled Unconsolidated Entities’ purchase thereof or the
date upon which such property was last security for Indebtedness of such
Person, including preparation of a “Phase I” report and, if appropriate, a
“Phase II” report, in each case prepared by a recognized environmental engineer
in accordance with customary standards which discloses that such property is
not in violation of the representations and covenants set forth in this
Agreement, unless such violation has been disclosed in writing to the Agent and
remediation actions satisfactory to Agent are being taken.  There are no unpaid or outstanding real
estate or other taxes or assessments on or against any property of the
Borrower, the Related Companies or the Controlled Unconsolidated Entities which
are payable by such Person (except only real estate or other taxes or
assessments, that are not yet due and payable).  Except as set forth in Schedule 6.22 hereto, there
are no pending eminent domain proceedings against any property of the Borrower,
the Related Companies or the Controlled Unconsolidated Entities or any part
thereof, and, to the knowledge of the Borrower, no such proceedings are
presently threatened or

 

26

 

contemplated by any taking authority which may
individually or in the aggregate have any materially adverse effect on the
business or financial condition of the Borrower.  To Borrower’s knowledge after due inquiry and investigation none
of the property of Borrower, the Related Companies or the Controlled
Unconsolidated Entities is now damaged or injured as a result of any fire,
explosion, accident, flood or other casualty in any manner which individually
or in the aggregate would have any materially adverse effect on the business or
financial condition of the Borrower.

 

§7.                               AFFIRMATIVE COVENANTS OF THE BORROWER.  Borrower covenants and agrees as follows, so
long as any Loan or Note is outstanding or the Lenders have any obligations to
make Loans:

 

§7.1                          Punctual Payment.  The Borrower will unconditionally duly and punctually pay the
principal and interest on the Loans and all other amounts provided for in the
Note, this Agreement, and the other Loan Documents all in accordance with the
terms of the Note, this Agreement and the other Loan Documents.

 

§7.2                          Maintenance of Office.  The Borrower will maintain its chief
executive office at 1780 S. Bellaire Street, Suite 515, Denver, CO 80222 or at
such other place in the United States of America as the Borrower shall
designate upon written notice to the Agent to be delivered within fifteen (15)
days of such change, where notices, presentations and demands to or upon the
Borrower in respect of the Loan Documents may be given or made.

 

§7.3                          Records and Accounts.  The Borrower will (a) keep true and accurate
(in all material respects) records and books of account in which full, true and
correct entries (in all material respects) will be made in accordance with
Generally Accepted Accounting Principles and (b) maintain adequate accounts and
reserves for all taxes (including income taxes), depreciation and amortization
of its properties, contingencies, and other reserves.

 

§7.4                          Financial Statements, Certificates and Information.  The Borrower will deliver to each of the
Lenders:

 

(a)                                  as
soon as practicable, but in any event not later than ninety (90) days after the
end of each fiscal year of the Borrower, the audited balance sheet of the
Borrower at the end of such year, and the related audited statement of income,
statement of changes in shareholders, equity and statement of cash flows for
such year, each setting forth in comparative form the figures for the previous
fiscal year and all such statements to be in reasonable detail, prepared in
accordance with Generally Accepted Accounting Principles, and accompanied by an
auditor’s report prepared without qualification by or by an independent
certified public accountant reasonably acceptable to the Agent;

 

(b)                                 as
soon as practicable, but in any event not later than forty-five (45) days after
the end of each of the first three (3) fiscal quarters of the Borrower, copies
of the unaudited balance sheets of the Borrower as at the end of such quarter,
and the related unaudited statement of income, statement of changes in
shareholders’ equity and statement of cash flows for the portion of the
Borrower’s fiscal year then elapsed, all in reasonable detail and prepared in
accordance with Generally Accepted Accounting Principles, together with a
certification by the

 

27

 

principal financial or accounting officer of the
Borrower that the information contained in such financial statements fairly
presents the financial position of the Borrower on the date thereof (subject to
year-end adjustments);

 

(c)                                  as
soon as practicable, but in any event no later than forty-five (45) days after
the end of each fiscal quarter of the Borrower, the Borrower will provide the
Agent with, for each parcel of Real Estate: (i) a rent roll dated as of the end
of such fiscal quarter in form reasonably satisfactory to the Agent, (ii) a
statement of the Net Operating Income for each parcel of Real Estate for such
fiscal quarter and year to date and (iii) after the last quarter of each year,
a detailed statement of all income and expenses for each parcel of Real Estate for
such year;

 

(d)                                 simultaneously
with the delivery of the financial statements referred to in subsections (a)
and (b) above, a Compliance Certificate;

 

(e)                                  as
soon as practicable, but in any event not later than ninety (90) days after the
end of each fiscal year of the Borrower, copies of the Form 10-K statement
filed with the Securities and Exchange Commission (“SEC”) for such fiscal year,
and as soon as practicable, but in any event not later than forty-five (45)
days after the end of each fiscal quarter, copies of the Form 10-Q statement
filed with the SEC for such fiscal quarter, provided that in either case if the
SEC has granted an extension for the filing of such statements, Borrower shall
deliver such statements to the Agent simultaneously with the filing thereof
with the SEC;

 

(f)                                    promptly
following the filing or mailing thereof, copies of all other material of a
financial nature filed with the SEC, and each Lender will be included on
Borrower’s mailing list so that it will receive copies of all press releases
issued by the Borrower;

 

(g)                                 as
soon as practicable, but in any event not later than sixty (60) days prior to
the beginning of each fiscal year of the Borrower a cash flow budget for the
Borrower and a property budget for each parcel of Real Estate for such fiscal
year; and

 

(h)                                 from
time to time such other financial data and information as the Agent may
reasonably request;

 

§7.5                          Notices.

 

(a)                                  Defaults.  The Borrower will promptly notify the Agent
in writing of the occurrence of any Default or Event of Default. If any Person
shall give any notice or take any other action in respect of a claimed default
(whether or not constituting a Default or an Event of Default under this
Agreement) under any note, evidence of Indebtedness, indenture or other obligation
to which or with respect to which the Borrower or any of the Related Companies
is a party or obligor, whether as principal or surety, and such default would
permit the holder of such note or obligation or other evidence of Indebtedness
to accelerate the maturity thereof, the Borrower shall forthwith give written
notice thereof to the Agent and each of the Lenders, describing the notice or
action and the nature of the claimed default.

 

(b)                                 Environmental
Events.  The Borrower will promptly
notify the Agent in writing of any of the following events: (i) upon Borrower’s
obtaining knowledge of any violation of any Environmental Law regarding any
Real Estate or Borrower’s operations which violation

 

28

 

could have a Material Adverse Effect; (ii) upon
Borrower’s obtaining knowledge of any potential or known Release, or threat of
Release, of any Hazardous Substance at, from, or into any Real Estate which it
reports in writing or is reportable by it in writing to any governmental
authority and which is material in amount or nature or which could materially
affect the value of such Real Estate; (iii) upon Borrower’s receipt of any
notice of violation of any Environmental Laws or of any Release or threatened Release
of Hazardous Substances, including a notice or claim of liability or potential
responsibility from any third party (including without limitation any federal,
state or local governmental officials) and including notice of any formal
inquiry, proceeding, demand, investigation or other action with regard to (A)
Borrower’s or any Person’s operation of any Real Estate to the extent it may
result in a Material Adverse Effect, (3) contamination on, from or into any
Real Estate to the extent it may result in a Material Adverse Effect, or (C)
investigation or remediation of off-site locations at which Borrower or any of
its predecessors are alleged to have directly or indirectly disposed of
Hazardous Substances; or (iv) upon Borrower’s obtaining knowledge that any
expense or loss has been incurred by such governmental authority in connection
with the assessment, containment, removal or remediation of any Hazardous
Substances with respect to which Borrower or any of the Related Companies may
be liable or for which a lien may be imposed on any Real Estate to the extent
such liability may result in a Material Adverse Effect.

 

(c)                                  Notification
of Claims.  The Borrower will,
immediately upon becoming aware thereof, notify the Agent in writing of any
setoff, claims (including, with respect to any of the Real Estate,
environmental claims), withholdings or other defenses which could have a
Material Adverse Effect.

 

(d)                                 Notice
of Litigation and Judgments.  The
Borrower will give notice to the Agent in writing within fifteen (15) days of
becoming aware of any litigation or proceedings threatened in writing or any
pending litigation and proceedings affecting any of the Real Estate or
affecting the Borrower or any of the Related Companies or to which the Borrower
or any of the Related Companies is or is to become a party involving an
uninsured claim (or as to which the insurer reserves rights) against the
Borrower or any of the Related Companies that at the time of giving of notice
could reasonably be expected to have a Materially Adverse Effect, and stating
the nature and status of such litigation or proceedings. The Borrower will give
notice to the Agent, in writing, in form and detail reasonably satisfactory to
the Agent, within ten (10) days of any judgment not covered by insurance, final
or otherwise, against the Borrower or any Related Company in an amount in
excess of $50,000.

 

§7.6                          Existence; Maintenance of REIT Status;
Maintenance of Properties.  The
Borrower will do or cause to be done all things necessary to preserve and keep
in full force and effect its existence as a Maryland corporation and its status
as a self administered real estate investment trust under the Code. The
Borrower will do or cause to be done all things necessary to preserve and keep
in full force and effect the existence of each Related Company.  Borrower will comply in all material
respects with all applicable rules and regulations of the SEC relating to its
publicly held stock. Borrower will continue to have its stock listed on one of
the major stock exchanges in the United States, and will comply in all material
respects with all applicable rules of the stock exchange where the stock is so
listed. The Borrower will do or cause to be done all things necessary to
preserve and keep in full force all of its rights and franchises which in the
judgment of the Borrower may be necessary to properly and advantageously
conduct the

 

29

 

businesses being conducted by it, or by any of the
Related Companies. The Borrower will continue to engage primarily in the
businesses now conducted by it and in related businesses.

 

§7.7                          Insurance. 
With respect to the properties and businesses of Borrower and the
Related Companies, the Borrower will maintain or cause to be maintained
insurance with financially sound and reputable insurers against such casualties
and contingencies as shall be in accordance with the general practices of
businesses engaged in similar activities in similar geographic areas and in
amounts, containing such terms, in such forms and for such periods as may be
reasonable and prudent.

 

§7.8                          Taxes.  The
Borrower will pay real estate taxes, other taxes, assessments and other
governmental charges against the Real Estate before the same become delinquent,
and will duly pay and discharge, or cause to be paid and discharged, before the
same shall become overdue, all taxes, assessments and other governmental
charges imposed upon it and its other properties, sales and activities, or any
part thereof, or upon the income or profits therefrom, as well as all claims
for labor, materials, or supplies that if unpaid might by law become a lien or
charge upon any of its properties; provided that any such tax, assessment,
charge, levy or claim need not be paid if the validity or amount thereof shall
currently be contested in good faith by appropriate proceedings and if the
Borrower shall have set aside on its books adequate reserves with respect
thereto; and provided further that the Borrower will pay all such taxes,
assessments, charges, levies or claims forthwith upon the commencement of
proceedings to foreclose any lien that may have attached as security therefor.
Promptly after payment of real estate taxes, other taxes, assessments and other
governmental charges against the Real Estate, Borrower will provide evidence of
such payments to the Agent, in the form of receipted tax bills or other form
reasonably acceptable to the Agent. 

 

§7.9                          Inspection of Properties and Books.  The Borrower shall permit the Lenders,
through the Agent’s or any Lender’s other designated representatives, at the
Borrower’s expense to visit and inspect any of the Real Estate or any of
Borrower’s offices, to examine the books of account of the Borrower and the
Related Companies (and to make copies thereof and extracts therefrom) and to
discuss the affairs, finances and accounts of the Borrower with, and to be
advised as to the same by, its officers, all at such reasonable times and
intervals as the Agent or any Lender may reasonably request.

 

§7.10                    Compliance
with Laws, Contracts, Licenses, and Permits.  The Borrower will comply, and will cause all
Related Companies to comply, with (a) all applicable laws and regulations now
or hereafter in effect wherever its business is conducted, including all
Environmental Laws, (b) the provisions of all applicable partnership
agreements, charter documents and by-laws, (c) all agreements and instruments
to which it is a party or by which it or any of its Real Estate Assets may be
bound including any leases, and (d) all applicable decrees, orders, and
judgments. If at any time any Permit from any governmental Person shall become
necessary or required in order that the Borrower may fulfill or be in
compliance with any of its obligations hereunder or under any of the Loan Documents,
the Borrower will promptly take or cause to be taken all reasonable steps
within the power of the Borrower to obtain such authorization, consent,
approval, permit or license and furnish the Agent and the Lenders with evidence
thereof.

 

30

 

§7.11                    Use of
Proceeds.  Subject to the
provisions of §2.5 hereof, the proceeds of the Loans shall be used by the
Borrower to refinance the existing $15,000,000.00 loan from FNB to Borrower,
for making Investments permitted by §8.3, and for working capital and other
purposes consistent with the covenants contained herein.

 

§7.12                    Reserved.

 

§7.13                    [Intentionally
Omitted.]

 

§7.14                    Interest
Rate Protection. 
Borrower shall maintain in effect interest rate caps, swaps or other
interest hedging contracts with counterparties and in form and substance
reasonably satisfactory to the Agent covering such portion of Borrower’s
variable rate debt as may be required by the Agent.

 

§7.15                    Further Assurance.  The Borrower will cooperate with the Agent
and the Lenders and execute such further instruments and documents and perform
such further acts as the Agent and the Lenders shall reasonably request to
carry out to their satisfaction the transactions contemplated by this Agreement
and the other Loan Documents.

 

§7.16                    Reserved.

 

§7.17                    Environmental Indemnification.  The Borrower covenants and agrees that it
will indemnify and hold the Agent and each Lender harmless from and against any
and all claims, expense, damage, loss or liability incurred by the Agent or any
Lender (including all reasonable costs of legal representation incurred by the
Agent or any Lender, but excluding, as applicable, for the Agent or a Lender
any claim, expense, damage, loss or liability as a result of the gross negligence
or willful misconduct of the Agent or such Lender) relating to (a) any Release
or threatened Release of Hazardous Substances on any Real Estate; (b) any
violation of any Environmental Laws with respect to conditions at any Real
Estate or the operations conducted thereon; or (c) the investigation or
remediation of off-site locations at which the Borrower or its predecessors are
alleged to have directly or indirectly disposed of Hazardous Substances. It is
expressly acknowledged by the Borrower that this covenant of indemnification
shall survive any modification, release or discharge of any or all of the Loan
Documents or the payment of the Loans and shall inure to the benefit of the
Agent and the Lenders, and their successors and assigns.

 

§7.18                    Response
Actions.  The Borrower covenants
and agrees that if any Release or disposal of Hazardous Substances shall occur
or shall have occurred on any Real Estate, the Borrower will cause the prompt
containment and removal of such Hazardous Substances and remediation of such
Real Estate as necessary to comply with all Environmental Laws or to preserve
the value of such Real Estate.

 

§7.19                    Environmental
Assessments.  If the Agent in
its good faith judgment, after discussion with the Borrower, has reason to believe
that the environmental condition of any Real Estate has deteriorated, after
reasonable notice by the Agent, whether or not a Default or an Event of Default
shall have occurred, the Agent may, from time to time, for the purpose of
assessing and ensuring the value of such Real Estate, obtain one or more
environmental assessments or audits of such Real Estate prepared by an
independent engineer or other qualified

 

31

 

consultant or expert approved by the Agent to evaluate
or confirm (i) whether any Hazardous Substances are present in the soil or
water at such Real Estate and (ii) whether the use and operation of such Real
Estate complies with all Environmental Laws. Environmental assessments may
include without limitation detailed visual inspections of such Real Estate
including, without limitation, any and all storage areas, storage tanks,
drains, dry wells and leaching areas, and the taking of soil samples, surface
water samples and ground water samples, as well as such other investigations or
analyses as the Agent deems appropriate. All such environmental assessments
shall be at the sole cost and expense of the Borrower.

 

§7.20                    Employee
Benefit Plans.  

 

(a)                                  Representation.  The Borrower and its ERISA Affiliates do not
currently maintain or contribute to any Guaranteed Pension Plan or
Multiemployer Plan.

 

(b)                                 Notice.  The Borrower will obtain the consent of the
Agent, which consent shall not be unreasonably withheld, conditioned or
delayed, prior to the establishment of any Employee Benefit Plan or Guaranteed
Pension Plan by the Borrower or any ERISA Affiliate.

 

(c)                                  In
General.  Each Employee Benefit Plan
maintained by the Borrower or any ERISA Affiliate will be operated in
compliance in all material respects with the provisions of ERISA and, to the
extent applicable, the Code, including but not limited to the provisions
thereunder respecting prohibited transactions.

 

(d)                                 Terminability
of Welfare Plans.  With respect to
each Employee Benefit Plan maintained by the Borrower or an ERISA Affiliate
which is an employee welfare benefit plan within the meaning of §3(1) or
§3(2)(B) of ERISA, the Borrower, or the ERISA Affiliate, as the case may be,
has the right to terminate each such plan at any time (or at any time subsequent
to the expiration of any applicable bargaining agreement) without liability
other than liability to pay claims incurred prior to the date of termination.

 

(e)                                  Multiemployer
Plans.  Without the consent of the
Agent, the Borrower will not enter into, maintain or contribute to, any
multiemployer Plan.

 

(f)                                    Unfunded
or Underfunded Liabilities.  The
Borrower will not, at any time, have accruing unfunded or underfunded
liabilities with respect to any Employee Benefit Plan, Guaranteed Pension Plan
or Multiemployer Plan, or permit any condition to exist under any Multiemployer
Plan that would create a withdrawal liability.

 

§7.21                    More
Restrictive Agreements. 
Without limiting the terms of §8.1, should the Borrower enter into or
modify any agreements or documents pertaining to any existing or future
Indebtedness, which agreements or documents include covenants (whether
affirmative or negative), warranties, representations, defaults or events of
default (or any other provision which may have the same practical effect as any
of the foregoing) which are individually or in the aggregate more restrictive
against the Borrower than those set forth herein or in any of the other Loan
Documents, the Borrower shall promptly notify the Agent and, if requested by
Majority Lenders, the Borrower, the Agent and the Majority Lenders shall
promptly amend this Agreement and the other Loan Documents to include some or
all or such more restrictive provisions as determined by the Majority Lenders
in their sole discretion.  Notwithstanding
the

 

32

 

foregoing, this §7.21 shall not apply to covenants in
agreements or documents relating to Indebtedness that relate only to specific
Real Estate that is collateral for such Indebtedness.

 

§8.                               CERTAIN NEGATIVE COVENANTS OF THE BORROWER.  The Borrower covenants and agrees as
follows, so long as any Loan or Note is outstanding or the Lenders have any
obligation to make any Loans:

 

§8.1                          Restrictions on Indebtedness.  The Borrower will not, and the Borrower will
not permit any of the Related Companies or any Controlled Unconsolidated Entity
to create, incur, assume, guarantee or become or remain liable, contingently or
otherwise, with respect to any Indebtedness other than:

 

(a)                                  Indebtedness
arising under the Secured Revolving Credit Agreement or under any of the Loan
Documents;

 

(b)                                 current
liabilities of the Borrower incurred in the ordinary course of business but not
incurred through (i) the borrowing of money, or (ii) the obtaining of credit
except for credit on an open account basis customarily extended and in fact
extended in connection with normal purchases of goods and services;

 

(c)                                  Indebtedness
in respect of taxes, assessments, governmental charges or levies and claims for
labor, materials and supplies to the extent that payment therefor shall not at
the time be required to be made in accordance with the provisions of §7.8;

 

(d)                                 Indebtedness
in respect of judgments or awards that have been in force for less than the
applicable period for taking an appeal so long as execution is not levied
thereunder or in respect of which the Borrower shall at the time in good faith
be prosecuting an appeal or proceedings for review and in respect of which a
stay of execution shall have been obtained pending such appeal or review;

 

(e)                                  endorsements
for collection, deposit or negotiation and warranties of products or services,
in each case incurred in the ordinary course of business;

 

(f)                                    Indebtedness
of Borrower or the Related Companies to the extent the same does not create a
violation of §9.3, §9.4 or §9.5 and is subject to terms and conditions
consistent with conventional commercial real estate lending practices, provided
that upon the creation or assumption of any such Indebtedness in an amount
exceeding $5,000,000 Borrower shall provide the Agent with a notice describing
the terms of such Indebtedness and the security therefor and a Compliance
Certificate with updated calculations reflecting such Indebtedness.

 

§8.2                          Restrictions on Liens, Etc.  The Borrower will not, and the Borrower will
not permit any Related Company or Controlled Unconsolidated Subsidiary to, (a)
create or incur or agree not to create or incur or suffer to be created or
incurred or to exist any lien, encumbrance, mortgage, pledge, charge, restriction
or other security interest of any kind upon any of its assets or properties of
any character, or upon the rents, income or profits therefrom; (b) suffer to
exist for a period of more than thirty (30) days after the same shall have been
incurred any Indebtedness (not permitted by §8.1(c)) or claim or demand against
it that if unpaid might by law or upon bankruptcy or insolvency, or otherwise,
be given any priority whatsoever over its

 

33

 

general creditors; or (c) sell, assign, pledge or
otherwise transfer any rents, issues, profits, accounts, contract rights,
general intangibles, chattel paper or instruments relating to any of its assets
or properties of any character other than in connection with the sale of the
Real Estate to which they pertain as permitted hereunder; provided that the
Borrower may create or incur or suffer to be created or incurred or to exist:

 

(i)                                     liens
to secure taxes, assessments and other governmental charges in respect of obligations
not overdue, the Indebtedness with respect to which is permitted by §8.1(c);

 

(ii)                                  deposits
or pledges made in connection with, or to secure payment of, workers
compensation, unemployment insurance, old age pensions or other social security
obligations;

 

(iii)                               liens
in respect of judgments or awards, the Indebtedness with respect to which is
permitted by §8.1(d);

 

(iv)                              liens
of carriers, warehousemen, mechanics and materialmen, and other like liens in
existence less than 60 days from the date of creation thereof in respect of
obligations not overdue, the Indebtedness with respect to which is permitted by
§8.1(c);

 

(v)                                 encumbrances
consisting of leases, easements, rights of way, covenants, restrictions on the
use of real property and defects and irregularities in the title thereto;  and other minor liens or encumbrances none
of which in the opinion of the Borrower interferes materially with the use of
the property affected in the ordinary conduct of the business of the Borrower,
and which matters (x) do not individually or in the aggregate have a materially
adverse effect on the use or value of the Real Estate and (xx) do not make
title to such property unmarketable by the conveyancing standards in effect
where such property is located; and

 

(vi)                              liens
on Real Estate to secure the Indebtedness permitted by §8.1(f).

 

§8.3                          Restrictions on Investments.  The Borrower will not, and will not permit
any of the Related Companies or any Controlled Unconsolidated Entity to make or
permit to exist or to remain outstanding any Investment except Investments in:

 

(a)                                  marketable
direct or guaranteed obligations of the United States of America that mature
within one (1) year from the date of purchase by the Borrower;

 

(b)                                 demand
deposits, certificates of deposit, bankers acceptances and time deposits of
United States banks having total assets in excess of $1,000,000,000;

 

(c)                                  securities
commonly known as “commercial paper” issued by a corporation organized and
existing under the laws of the United States of America or any state thereof
that at the time of purchase have been rated and the ratings for which are not
less than “P 1” if rated by Moody’s Investors Services, Inc., and not less than
“A 1” if rated by Standard and Poor’s;

 

34

 

(d)                                 Investments
in office properties (but not including office properties that are under
construction) consistent with Borrower’s business plan submitted to the Agent
prior to the date hereof and Investments in the following categories so long as
the aggregate amount of each of the following categories of Investments does
not exceed the specified percentage of Gross Asset Value set forth in the
following table and so long as the aggregate amount, without duplication, of
all Investments described in such categories does not exceed, at any time,
fifteen percent (15%) of Gross Asset Value:

 

	
  Category of Investment

  	
   

  	
  Maximum
  Percentage of Gross Asset Value

  	
   

  
	
  Real Estate Assets that are not office
  buildings or office parks

  	
   

  	
  5

  	
  %

  
	
  Unconsolidated Entities primarily engaged
  in either the business of ownership of real estate located in the United
  States

  	
   

  	
  10

  	
  %

  
	
  Undeveloped land

  	
   

  	
  5

  	
  %

  
	
  Mortgages and notes receivable

  	
   

  	
  5

  	
  %

  

 

§8.4                          Merger, Consolidation, Acquisition and Disposition of
Properties.

 

(a)                                  The
Borrower will not, and will not permit any of the Related Companies or any
Controlled Unconsolidated Entity to become a party to any merger or
consolidation, or agree to or effect any stock acquisition, or enter into any
partnership or joint venture other than partnerships or joint ventures relating
to Unconsolidated Entities to the extent allowed by §8.3(d).

 

(b)                                 [Intentionally
Omitted.]

 

(c)                                  Borrower
will not, and will not permit any of the Related Companies or any Controlled
Unconsolidated Entity to acquire or sell or otherwise dispose of Real Estate
Assets pursuant to a single transaction or a series of related transactions if
the aggregate price or other consideration exceeds $5,000,000 unless prior to
such acquisition, sale or transfer, the Borrower shall provide the Agent with a
notice describing the terms of such transaction and a Compliance Certificate
with updated calculations reflecting such transaction, and, if the aggregate
price or other consideration for an acquisition of Real Estate Assets exceeds $30,000,000,
unless prior to such acquisition, the Borrower shall have obtained the consent
of the Majority Lenders.

 

(d)                                 The
Borrower shall not transfer any assets to any of the Related Companies or any
Unconsolidated Entity, and shall not make any other material changes to the
structure of its corporate organization or the manner in which it operates its
business, except with the prior written consent of the Agent.

 

§8.5                          Sale and Leaseback.  The Borrower will not enter into any arrangement, directly or
indirectly, whereby the Borrower shall sell or transfer any property owned by
it in order then or thereafter to lease such property or lease other property
that the Borrower intends to use for substantially the same purpose as the
property being sold or transferred. The Borrower will not

 

35

 

permit any of the Related Companies or any Controlled
Unconsolidated Entity to enter into any such arrangement.

 

§8.6                          Compliance with Environmental Laws.  The Borrower will not do, and will not
permit any of the Related Companies or any Controlled Unconsolidated Entity to
do, any of the following: (a) use any of the Real Estate or any portion thereof
as a facility for the handling, processing, storage or disposal of Hazardous Materials
except for immaterial amounts of Hazardous Materials used in the routine
maintenance and operation of the Real Estate and in compliance with applicable
law, (b) cause or permit to be located on any of the Real Estate any
underground tank or other underground storage receptacle for Hazardous
Materials except in material compliance with Environmental Laws, (c) generate
any Hazardous Materials on any of the Real Estate except in material compliance
with Environmental Laws, or (d) conduct any activity at any Real Estate or use
any Real Estate in any manner so as to cause a Release.

 

§8.7                          Distributions. 
Borrower shall not permit the total Distributions by it during any
fiscal year to exceed ninety percent (90%) of Funds from Operations except that
such limitation on Distributions may be exceeded to the extent necessary for
the Borrower to maintain its REIT status provided that the Borrower provides
the Agent with a letter from its accountants or attorneys setting forth the
basis for computation of the amount of such necessary excess
Distributions.  During any period when
any Default or Event of Default has occurred and is continuing the total
Distributions by the Borrower will not exceed the minimum amount necessary for
the Borrower to maintain its REIT status.

 

§8.8                          [Intentionally Omitted.]

 

§8.9                          Related Companies.  The Borrower will not amend the articles of incorporation or
bylaws or other organizational documents of any of the Related Companies other
than as may be required by any lender in connection with the incurrence of
Indebtedness permitted under §8.1. 
Borrower will not, directly or indirectly, make or permit to be made, by
voluntary or involuntary means, any sale, assignment, transfer, disposition,
mortgage, pledge, hypothecation or encumbrance of its interest in any Related
Company or Unconsolidated Entity or any dilution of its interest in any Related
Company or Unconsolidated Entity.

 

§9.                               FINANCIAL COVENANTS OF THE BORROWER.  The Borrower covenants and agrees as
follows, so long as any Loan or Note is outstanding or any Lender has any
obligation to make any Loan:

 

§9.1                          Reserved.  

 

§9.2                          Reserved.  

 

§9.3                          Total Liabilities to Gross Asset Value.  The Borrower will not permit Total
Liabilities to exceed seventy percent (70%) of Gross Asset Value, calculated as
of the end of each fiscal quarter through and including the fiscal quarter
ending March 31, 2004. Beginning with the fiscal quarter ending
June 30, 2004, the Borrower will not permit Total Liabilities to exceed
sixty-five percent (65%) of Gross Asset Value, calculated as of the end of each
fiscal quarter.

 

36

 

§9.4                          Adjusted EBITDA to Interest Expense.  The Borrower will not permit the ratio of
its Adjusted EBITDA to Interest Expense to be less than 1.75 to 1.0 for any
period of four consecutive fiscal quarters, calculated as of the end of each
fiscal quarter through and including the fiscal quarter ending March 31,
2004.  Beginning with the period of four
consecutive fiscal quarters ending June 30, 2004, the Borrower will not
permit the ratio of its Adjusted EBITDA to Interest Expense to be less than 2.0
to 1.0 for any period of four consecutive fiscal quarters, calculated as of the
end of each fiscal quarter.

 

§9.5                          EBITDA to Fixed Charges.  The Borrower will not permit the ratio of
its EBITDA to Fixed Charges to be less than 1.5 to 1.0 for any period of four
consecutive fiscal quarters, calculated as of the end of each fiscal quarter
through and including the fiscal quarter ending March 31, 2004.  Beginning with the period of four
consecutive fiscal quarters ending June 30, 2004, the Borrower will not
permit the ratio of its EBITDA to Fixed Charges to be less than 1.75 to 1.0 for
any period of four consecutive fiscal quarters, calculated as of the end of
each fiscal quarter.

 

§9.6                          Minimum Tangible Net Worth.  The Borrower will not at any time permit its
Tangible Net Worth to be less than the sum of $25,000,000, plus 75% of Net
Offering Proceeds after March 31, 2003, plus 100% of Net OP Proceeds after
March 31, 2003.

 

§10.                        CONDITIONS TO EFFECTIVENESS.  This Agreement shall become effective when
each of the following conditions precedent have been satisfied:

 

§10.1                    Loan Documents.  Each of the Loan Documents shall have been
duly executed and delivered by the respective parties thereto, shall be in full
force and effect and shall be in form and substance satisfactory to each of the
Lenders. Each Lender shall have received a fully executed original of its Note
prior to or on the Closing Date.

 

§10.2                    Good
Standing Certificates and Certified Copies.  The Agent shall have received (i) a Certificate of Good Standing
for the Borrower from the State of Maryland and a certificate of qualification
for the Borrower to do business from the State of Colorado, and (ii) a copy of
the Borrower’s Articles of Incorporation certified by the Maryland Secretary of
State.

 

§10.3                    By-laws;
Resolutions.  All action on the
part of the Borrower necessary for the valid execution, delivery and
performance by the Borrower of this Agreement and the other Loan Documents to
which it is or is to become a party shall have been duly and effectively taken,
and evidence thereof satisfactory to the Agent shall have been provided to the
Agent. The Agent shall have received from the Borrower true copies of its
by-laws and the resolutions adopted by its Board of Directors authorizing the
transactions described herein, each certified by its secretary to be true and
complete and in effect on the Closing Date.

 

§10.4                    Incumbency
Certificate; Authorized Signers. 
The Agent shall have received from the Borrower an incumbency
certificate, dated as of the Closing Date, signed by a duly authorized officer
of the Borrower and giving the name and bearing a specimen signature of each
Responsible Officer.

 

§10.5                    Opinions
of Counsel Concerning Organization and Loan Documents.  Each of the Lenders and the Agent shall have
received favorable opinions addressed to the Lenders and the

 

37

 

Agent and dated as of the Closing Date, in form and
substance reasonably satisfactory to the Lenders and the Agent from Borrower’s
counsel, which opinion may rely on opinions from other law firms approved by
the Lenders as to matters of law applicable in the various states where the Borrower
is organized.

 

§10.6                    Payment of
Fees.  The Borrower shall have
paid to the Agent the fees pursuant to §4.1 and shall have paid all other
expenses as provided in §15 hereof then outstanding.

 

§10.7                    Compliance
Certificate.  The Agent shall
have received a Compliance Certificate showing compliance with §8.3(d), and
§9.3 through §9.6 as of September 30, 2003 and for the fiscal periods
ending thereon.

 

§11.                        CONDITIONS TO ALL BORROWINGS.  The obligations of the Lenders to make any
Loan, whether on or after the Closing Date shall also be subject to the
satisfaction of the following conditions precedent:

 

§11.1                    Representations
True; No Event of Default; Compliance Certificate.  Each of the representations and warranties
of the Borrower contained in this Agreement, the other Loan Documents or in any
document or instrument delivered pursuant to or in connection with this
Agreement shall be true and correct in all material respects as of the date as
of which they were made and shall also be true and correct in all material
respects at and as of the time of the making of such Loan, with the same effect
as if made at and as of that time (except to the extent of changes resulting
from transactions contemplated or permitted by this Agreement and the other
Loan Documents and changes occurring in the ordinary course of business that
singly or in the aggregate are not materially adverse, and except to the extent
that such representations and warranties relate expressly to an earlier date);
the Borrower shall have performed and complied with all terms and conditions
herein required to be performed by it or prior to the Borrowing Date of such
Loan; and no Default or Event of Default shall have occurred and be continuing
on the date of any Loan Request or on the Borrowing Date of such Loan; and
Agent shall have received a Compliance Certificate with computations evidencing
compliance with the covenants contained in §9.1 through §9.6 hereof after
giving effect to such requested Loan.

 

§11.2                    No Legal
Impediment.  No change shall have
occurred in any law or regulations thereunder or interpretations thereof that
in the reasonable opinion of any Lender would make it illegal for such Lender
to make such Loan.

 

§11.3                    Governmental
Regulation.  Each Lender shall have
received such statements in substance and form reasonably satisfactory to such
Lender as such Lender shall require for the purpose of compliance with any
applicable regulations of the Comptroller of the Currency or the Board of
Governors of the Federal Reserve System.

 

§11.4                    Proceedings
and Documents.  All proceedings in
connection with the transactions contemplated by this Agreement, the other Loan
Documents and all other documents incident thereto shall be reasonably
satisfactory in substance and in form to the Agent, and the Lenders shall have
received all information and such counterpart originals or certified or other
copies of such documents as the Agent may reasonably request.

 

38

 

§12.                        EVENTS OF DEFAULT; ACCELERATION; ETC.

 

§12.1                    Events of Default
and Acceleration.  If any of the
following events (“Events of Default” or, if the giving of notice or the lapse
of time or both is required, then, prior to such notice or lapse of time,
“Defaults”) shall occur:

 

(a)                                  the
Borrower shall fail to pay any principal of the Loans when the same shall
become due and payable;

 

(b)                                 the
Borrower shall fail to pay any interest on the Loans or any other sums due
hereunder or under any of the other Loan Documents within five (5) days after
the same shall become due and payable;

 

(c)                                  the
Borrower shall fail to comply with any of its covenants contained in §3.2,
§7.5, §7.6, §7.7, §7.8, §8 or §9 hereof;

 

(d)                                 the
Borrower shall fail to perform any other term, covenant or agreement contained
herein or in any of the other Loan Documents (other than those specified
elsewhere in this §12) for thirty (30) days after written notice of such
failure from Agent to the Borrower;

 

(e)                                  any
representation or warranty of the Borrower in this Agreement or any of the
other Loan Documents or in any other document or instrument delivered pursuant
to or in connection with this Agreement, shall prove to have been false in any
material respect upon the date when made or deemed to have been made or
repeated, provided, however, that with respect to the representations and
warranties of the Borrower contained in §6.18 and §6.22, if the condition or
event making the representation and warranty false is capable of being cured by
the Borrower, no enforcement action has been commenced against the Borrower or
the applicable Real Estate on account of such condition or event nor is the
applicable Real Estate subject to risk of forfeiture due to such condition or
event, and the Borrower promptly commences the cure thereof after the Borrower’s
first obtaining knowledge of such condition or event, the Borrower shall have a
period of thirty (30) days after the date that the Borrower first obtained
knowledge of such condition or event during which the Borrower may cure such
condition or event (or, if such condition or event is not reasonably capable of
being cured within such thirty (30) day period, such additional period of time
as may be reasonably required in order to cure such condition or event but in
any event such period shall not exceed six (6) months from the date that the
Borrower first obtained knowledge of such condition or event), and no Event of
Default shall exist hereunder during such thirty (30) day or additional period
so long as the Borrower continuously and diligently pursues the cure of such
condition or event and the other conditions to such cure period have not
changed;

 

(f)                                    the
Borrower, any of the Related Companies or any Controlled Unconsolidated Entity
shall fail to pay at maturity, or within any applicable period of grace, any
Indebtedness, or shall fail to observe or perform any material term, covenant
or agreement contained in any agreement by which it is bound, evidencing or
securing Indebtedness for such period of time as would permit (assuming the
giving of appropriate notice if required) the holder or holders thereof or of
any obligations issued thereunder to accelerate the maturity thereof, and in
any event, such failure shall continue for thirty (30) days, unless the
aggregate amount of all such defaulted Indebtedness plus the amount of any
unsatisfied judgments described in paragraph (i) of this §12.1 is less than
$5,000,000.00;

 

39

 

(g)                                 any
of the Borrower, any of the Related Companies or any Controlled Unconsolidated
Entity shall make an assignment for the benefit of creditors, or admit in
writing its inability to pay or generally fail to pay its debts as they mature
or become due, or shall petition or apply for the appointment of a trustee or
other custodian, liquidator or receiver of any substantial part of its
properties or shall commence any case or other proceeding under any bankruptcy,
reorganization, arrangement, insolvency, readjustment of debt, dissolution or
liquidation or similar law of any jurisdiction, now or hereafter in effect, or
shall take any action to authorize or in furtherance of any of the foregoing,
or if any such petition or application shall be filed or any such case or other
proceeding shall be commenced against any such Person and such Person shall
indicate its approval thereof, consent thereto or acquiescence therein;

 

(h)                                 a
decree or order is entered appointing any such trustee, custodian, liquidator
or receiver or adjudicating the Borrower, any of the Related Companies or any
Controlled Unconsolidated Entity bankrupt or insolvent, or approving a petition
in any such case or other proceeding, or a decree or order for relief is
entered in respect of the Borrower, any of the Related Companies or any
Controlled Unconsolidated Entity in an involuntary case under federal
bankruptcy laws as now or hereafter constituted;

 

(i)                                     there
shall remain in force, undischarged, unsatisfied and unstayed, for more than
thirty days, whether or not consecutive, any uninsured final judgment against
the Borrower, any of the Related Companies or any Controlled Unconsolidated
Entity that, with other outstanding uninsured final judgments, undischarged,
against the Borrower, any of the Related Companies or any Controlled
Unconsolidated Entity plus the amount of any defaulted Indebtedness under
paragraph (f) of this §12.1, exceeds in the aggregate $5,000,000.00;

 

(j)                                     if
any of the Loan Documents or any material provision of any Loan Documents shall
be unenforceable, cancelled, terminated, revoked or rescinded otherwise than in
accordance with the terms thereof or with the express prior written agreement,
consent or approval of the Agent, or any action at law, suit or in equity or
other legal proceeding to make unenforceable, cancel, revoke or rescind any of
the Loan Documents shall be commenced by or on behalf of the Borrower, or any
court or any other governmental or regulatory authority or agency of competent
jurisdiction shall make a determination that, or issue a judgment, order,
decree or ruling to the effect that, any one or more of the Loan Documents is
illegal, invalid or unenforceable in accordance with the terms thereof;

 

(k)                                  the
Borrower, any of the Related Companies or any Controlled Unconsolidated Entity
shall be indicted for a federal crime, a punishment for which could include the
forfeiture of any assets of the Borrower;

 

(l)                                     the
Borrower shall fail to pay, observe or perform any term, covenant, condition or
agreement contained in any agreement, document or instrument evidencing,
securing or otherwise relating to any Indebtedness of the Borrower to any
Lender (other than the Obligations) and/or relating to any Permitted Lien
(other than the Obligations) within any applicable period of grace provided for
in such agreement, document or instrument;

 

(m)                               [Intentionally
Omitted];

 

40

 

(n)                                 any
“Event of Default”, as defined in any of the other Loan Documents, shall occur;
or

 

(o)                                 Any
two or more of William Atkins, Charles Knight and John Greenman shall cease to
be a senior executive officer of the Borrower and the Board of Directors of the
Borrower shall not, within six months thereafter, hire a substitute officer who
has been approved by the Majority Lenders, with each Lender having the right to
approve or disapprove any proposed successor in its sole reasonable discretion;

 

(p)                                 a
Change of Control shall occur without the prior written consent of all Lenders;

 

(q)                                 any
“Event of Default” as defined in the Secured Revolving Credit Agreement shall
occur;

 

then, and in any such event, so long as the
same may be continuing, the Agent may, and upon the request of the Majority
Lenders shall, by notice in writing to the Borrower declare all amounts owing
with respect to this Agreement, the Notes and the other Loan Documents to be,
and they shall thereupon forthwith become, immediately due and payable without
presentment, demand, protest or other notice of any kind, all of which are
hereby expressly waived by the Borrower; provided that in the event of any
Event of Default specified in §§12.1(g) or 12.1(h), all such amounts shall
become immediately due and payable automatically and without any requirement of
notice from the Agent or action by the Majority Lenders.

 

§12.2                    Termination
of Commitments.  If any one or more
Events of Default specified in §12.1(g) or §12.1(h) shall occur, any unused
portion of the Commitments hereunder, shall forthwith terminate and the Lenders
shall be relieved of all obligations to make Loans to the Borrower.  If any other Event of Default shall have
occurred and be continuing, any Lender may by notice to the Borrower terminate
the unused portion of its Commitment hereunder, and upon such notice being
given such unused portion of its Commitment hereunder shall terminate
immediately and such Lender shall be relieved of all further obligations to
make Loans. No termination of such Lender’s Commitment hereunder shall relieve
the Borrower of any of the Obligations or any of its existing obligations to
such Lender arising under other agreements or instruments.

 

§12.3                    Remedies.  In case any one or more of the Events of
Default shall have occurred, and whether or not the Lenders shall have
accelerated the maturity of the Loans pursuant to §12.1, each Lender, if owed
any amount with respect to the Loans, may, with the consent of the Majority
Lenders, direct the Agent to proceed to protect and enforce the rights and
remedies of the Agent and the Lenders under this Agreement, the Notes or any of
the other Loan Documents by suit in equity, action at law or other appropriate
proceeding, whether for the specific performance of any covenant or agreement
contained in this Agreement and the other Loan Documents or any instrument
pursuant to which the obligations are evidenced, including to the full extent
permitted by applicable law the obtaining of the ex parte appointment of a
receiver and, if any amount shall have become due, by declaration or otherwise,
to proceed to enforce the payment thereof or any other legal or equitable right
of such Lender. No remedy herein conferred upon any Lender or the Agent or the
holder of any Note is intended to be exclusive of any other

 

41

 

remedy and each and every remedy shall be cumulative
and shall be in addition to every other remedy given hereunder or now or
hereafter existing at law or in equity or by statute or any other provision of
law.

 

§12.4                    Distribution
of Proceeds.  In the event that,
during the continuance of any Default or Event of Default, the Agent or any
Lender as the case may be, receives any monies in connection with the
enforcement of any of the Loan Documents, or otherwise with respect to the
realization upon any of the assets of the Borrower, such monies shall be
distributed for application as follows:

 

(a)                                  First,
to the payment of, or (as the case may be) the reimbursement of the Agent for
or in respect of all reasonable costs, expenses, disbursements and losses which
shall have been incurred or sustained by the Agent in connection with the
collection of such monies by the Agent, for the exercise, protection or
enforcement by the Agent of all or any of the rights, remedies, powers and
privileges of the Agent or the Lenders under this Agreement or any of the other
Loan Documents or in support of any provision of adequate indemnity to the
Agent against any taxes or liens which by law shall have, or may have, priority
over the rights of the Agent to such monies;

 

(b)                                 Second,
to all other Obligations in such order or preference as the Majority Lenders
may determine; provided, however, that in the event that any Lender shall have
wrongfully failed or refused to make an advance under §2.6 and such failure or
refusal shall be continuing, advances made by other Lenders during the pendency
of such failure or refusal shall be entitled to be repaid as to principal and
accrued interest in priority to the other Obligations described in this
subsection (b), and distributions in respect of such Obligations shall be
made among the Lenders pro rata in accordance with each Lender’s respective
Facility Percentage; and provided, further, that the Agent may in its
discretion make proper allowance to take into account any Obligations not then
due and payable;

 

(c)                                  Third,
upon payment and satisfaction in full or other provisions for payment in full
satisfactory to the Lenders and the Agent of all of the obligations, and to the
payment of any obligations required to be paid pursuant to applicable laws
applicable to such enforcement; and

 

(d)                                 Fourth,
the excess, if any, shall be returned to the Borrower or to such other Persons
as are legally entitled thereto.

 

§13.                        SETOFF.  Borrower hereby grants to each Lender, a
continuing lien, security interest and right of setoff as security for all
liabilities and obligations to such Lender hereunder, whether now existing or
hereafter arising, upon and against all deposits, credits, collateral and
property, now or hereafter in the possession, custody, safekeeping or control
of such Lender or in transit to it.  At
any time, without demand or notice (any such notice being expressly waived by
Borrower), any Lender may, WITH THE PRIOR APPROVAL OF THE AGENT, setoff the
same or any part thereof and apply the same to any liability or obligation of
Borrower hereunder even though unmatured and regardless of the adequacy of any
other collateral securing the Obligations. 
ANY AND ALL RIGHTS TO REQUIRE ANY LENDER TO EXERCISE ITS RIGHTS OR
REMEDIES WITH RESPECT TO ANY OTHER COLLATERAL WHICH

 

42

 

SECURES THE
OBLIGATIONS, PRIOR TO EXERCISING ITS RIGHT OF SETOFF WITH RESPECT TO SUCH
DEPOSITS, CREDITS OR OTHER PROPERTY OF BORROWER, ARE HEREBY KNOWINGLY,
VOLUNTARILY AND IRREVOCABLY WAIVED. Each of the Lenders agrees with each other
Lender that (a) if an amount to be set off is to be applied to Indebtedness of
the Borrower to such Lender, other than Indebtedness evidenced by the Notes
held by such Lender, such amount shall be applied ratably to such other
Indebtedness and to the Indebtedness evidenced by all such Notes held by such
Lender, and (b) if such Lender shall receive from the Borrower, whether by
voluntary payment, exercise of the right of setoff, counterclaim, cross action,
enforcement of the claim evidenced by the Notes held by such Lender by
proceedings against the Borrower at law or in equity or by proof thereof in
bankruptcy, reorganization, liquidation, receivership or similar proceedings,
or otherwise, and shall retain and apply to the payment of the Note or Notes
held by such Lender any amount in excess of its ratable portion of the payments
received by all of the Lenders with respect to the Notes held by all of the
Lenders, such Lender will make such disposition and arrangements with the other
Lenders with respect to such excess, either by way of distribution, pro tanto
assignment of claims, subrogation or otherwise as shall result in each Lender
receiving in respect of the Notes held by it its proportionate payment as
contemplated by this Agreement; provided that if all or any part of such excess
payment is thereafter recovered from such Lender, such disposition and
arrangements shall be rescinded and the amount restored to the extent of such
recovery, but without interest. 
Notwithstanding the foregoing, no Lender shall exercise a right of
setoff if such exercise would limit or prevent the exercise of any other remedy
or other recourse against the Borrower.

 

§14.                        THE AGENT.

 

§14.1                    Authorization.  The Agent is authorized to take such action
on behalf of each of the Lenders and to exercise all such powers as are hereunder
and under any of the other Loan Documents and any related documents delegated
to the Agent, together with such powers as are reasonably incident thereto,
provided that no duties or responsibilities not expressly assumed herein or
therein shall be implied to have been assumed by the Agent.  The obligations of Agent hereunder are
primarily administrative in nature, and nothing contained in this Agreement or
any of the other Loan Documents shall be construed to constitute the Agent as a
trustee for any Lender or to create any agency or fiduciary relationship.  Agent shall act as the contractual
representative of the Lenders hereunder, and notwithstanding the use of the
term “Agent”, it is understood and agreed that the Agent shall not have any
fiduciary duties or responsibilities to any Lender by reason of this Agreement
or any other Loan Document and is acting as an independent contractor, the
rights and duties of which are limited to those expressly set forth in this
Agreement and the other Loan Documents.

 

§14.2                    Employees
and Agents.  The Agent may
exercise its powers and execute its duties by or through employees or agents
and shall be entitled to take, and to rely on, advice of counsel concerning all
matters pertaining to its rights and duties under this Agreement and the other
Loan Documents. The Agent may utilize the services of such Persons as the Agent
in its sole discretion may reasonably determine, and all reasonable fees and
expenses of any such Persons shall be paid by the Borrower.

 

43

 

§14.3                    No Liability.  Neither the Agent nor any of its
shareholders, directors, officers or employees nor any other Person assisting
them in their duties nor any agent or employee thereof, shall be liable for any
waiver, consent or approval given or any action taken, or omitted to be taken,
in good faith by it or them hereunder or under any of the other Loan Documents,
or in connection herewith or therewith, or be responsible for the consequences
of any oversight or error of judgment whatsoever, except that the Agent or such
other Person, as the case may be, may be liable for losses due to its willful
misconduct or gross negligence as determined by a court of competent
jurisdiction after the exhaustion of all applicable appeal periods.

 

§14.4                    No
Representations.  The Agent
shall not be responsible for the execution or validity or enforceability by or
against Borrower of this Agreement, the Notes, any of the other Loan Documents
or any instrument at any time constituting, or intended to constitute,
collateral security for the Notes, or for the value of any such collateral
security or for the validity, enforceability or collectability of any such
amounts owing with respect to the Notes, or for any recitals or statements, warranties
or representations made herein or in any of the other Loan Documents or in any
certificate or instrument hereafter furnished to it by or on behalf of the
Borrower, or be bound to ascertain or inquire as to the performance or
observance of any of the terms, conditions, covenants or agreements herein or
in any instrument at any time constituting, or intended to constitute,
collateral security for the Notes. The Agent shall not be bound to ascertain
whether any notice, consent, waiver or request delivered to it by the Borrower
or any holder of any of the Notes shall have been duly authorized or is true,
accurate and complete. The Agent has not made nor does it now make any
representations or warranties, express or implied, nor does it assume any liability
to the Lenders, with respect to the credit worthiness or financial condition of
the Borrower or its Subsidiaries or any other Person.  Each Lender acknowledges that it has, independently and without
reliance upon the Agent or any other Lender, and based upon such information
and documents as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. 
Each Lender also acknowledges that it will, independently and without
reliance upon the Agent or any other Lender, based upon such information and
documents as it deems appropriate at the time, continue to make its own credit
analysis and decisions in taking or not taking action under this Agreement and
the other Loan Documents.  Agent’s
counsel has only represented Agent and FNB in connection with the Loan
Documents and the only attorney-client relationship or duty of care is between
Agent’s counsel and Agent or FNB. Each Lender has been independently
represented by separate counsel on all matters regarding the Loan Documents and
the granting and perfecting of liens in the Collateral.

 

§14.5                    Payments.

 

(a)                                  A
payment by the Borrower to the Agent hereunder or any of the other Loan
Documents for the account of any Lender shall constitute a payment to such
Lender subject to the pro rata rights to repayment based upon the Facility
Percentage of each Lender. The Agent agrees, promptly after the Agent’s receipt
of good funds as determined in accordance with Agent’s customary practices, to
distribute to each Lender such Lender’s pro rata share of payments received by
the Agent for the account of the Lenders except as otherwise expressly provided
herein or in any of the other Loan Documents.

 

(b)                                 If
in the opinion of the Agent the distribution of any amount received by it in
such capacity hereunder, under the Notes or under any of the other Loan
Documents might

 

44

 

involve it in liability, it may
refrain from making distribution until its right to make distribution shall
have been adjudicated by a court of competent jurisdiction. If a court of
competent jurisdiction shall adjudge that any amount received and distributed
by the Agent is to be repaid, each Person to whom any such distribution shall
have been made shall either repay to the Agent its proportionate share of the
amount so adjudged to be repaid or shall pay over the same in such manner and
to such Persons as shall be determined by such court.

 

(c)                                  Notwithstanding
anything to the contrary contained in this Agreement or any of the other Loan
Documents, any Lender that fails (i) to make available to the Agent its pro
rata share of any Loan or (ii) to comply with the provisions of §12 and §13
with respect to making dispositions and arrangements with the other Lenders,
where such Lender’s share of any payment received, whether by setoff or
otherwise, is in excess of its pro rata share of such payments due and payable
to all of the Lenders, in each case as, when and to the full extent required by
the provisions of this Agreement, or to adjust promptly such Lender’s
outstanding principal and its pro rata Facility Percentage as provided in §2.1
hereof, shall be deemed delinquent (a “Delinquent Lender”) and shall be deemed
a Delinquent Lender until such time as such delinquency is satisfied.  A Delinquent Lender shall be deemed to have
assigned any and all payments due to it from the Borrower, whether on account
of outstanding Loans, interest, fees or otherwise, to the remaining
nondelinquent Lenders for application to, and reduction of, their respective
pro rata shares of all outstanding Loans. 
The Delinquent Lender hereby authorizes the Agent to distribute such
payments to the nondelinquent Lenders in proportion to their respective pro
rata shares of all outstanding Loans. 
In addition to the rights and remedies that may be available to the
Agent at law and in equity, a Defaulting Lender’s right to participate in the
administration of the Loan Documents, including, without limitation, any rights
to consent to or direct any action or inaction of the Agent pursuant to this
Agreement or otherwise, or to be taken into account in the calculation of
Majority Lenders or any matter requiring approval of all of the Lenders, shall
be suspended while such Lender is a Defaulting Lender.  A Delinquent Lender shall be deemed to have
satisfied in full a delinquency when and if, as a result of application of the
assigned payments to all outstanding Loans of the nondelinquent Lenders, the
Lenders’ respective pro rata shares of all outstanding Loans have returned to
those in effect immediately prior to such delinquency and without giving effect
to the nonpayment causing such delinquency.

 

§14.6                    Holders
of Notes.  The Agent may deem
and treat the payee of any Note as the absolute owner or purchaser thereof for
all purposes hereof until it shall have been furnished in writing with a
different name by such payee or by a subsequent holder, assignee or transferee.

 

§14.7                    Indemnity.  The Lenders ratably agree hereby to
indemnify and hold harmless the Agent from and against any and all claims,
actions and suits (whether groundless or otherwise), losses, damages, costs,
expenses (including any expenses for which the Agent has not been reimbursed by
the Borrower as required by §15), and liabilities of every nature and character
arising out of or related to this Agreement, the Notes, or any of the other
Loan Documents or the transactions contemplated or evidenced hereby or thereby,
or the Agent’s actions taken hereunder or thereunder, except to the extent that
any of the same shall be directly caused by the Agent’s willful misconduct or
gross negligence as determined by a court of competent jurisdiction after the
exhaustion of all applicable appeal periods.

 

45

 

§14.8                    Agent
as Lender.  In its individual
capacity, FNB shall have the same obligations and the same rights, powers and
privileges in respect to its Commitment and the Loans made by it, and as the
holder of any of the Notes as it would have were it not also the Agent.

 

§14.9                    Resignation.  The Agent may resign at any time by giving
sixty (60) days, prior written notice thereof to the Lenders and the
Borrower.  Upon any such resignation,
the Majority Lenders shall have the right to appoint a successor Agent.  Unless a Default or Event of Default shall
have occurred and be continuing, appointment of such successor Agent shall be
subject to the reasonable approval of the Borrower.  If no successor Agent shall have been so appointed by the
Majority Lenders and shall have accepted such appointment within thirty (30)
days after the giving of notice of resignation or removal of the Borrower has
disapproved or failed to approve a successor agent within such period, then the
retiring Agent may, on behalf of the Lenders, appoint a successor Agent, which
shall be a financial institution having a rating of not less than A2/P2 or its
equivalent by Standard & Poor’s Corporation. Upon the acceptance of any
appointment as Agent hereunder by a successor Agent, such successor Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Agent, and the retiring Agent shall be discharged
from its duties and obligations hereunder. After any retiring Agent’s
resignation, the provisions of this Agreement and the other Loan Documents
shall continue in effect for its benefit in respect of any actions taken or
omitted to be taken by it while it was acting as Agent.

 

§14.10              Notification
of Defaults and Events of Default. 
Each Lender hereby agrees that, upon learning of the existence of a
Default or an Event of Default, it shall promptly notify the Agent thereof. The
Agent hereby agrees that upon receipt of any notice under this §14.10 it shall
promptly notify the other Lenders of the existence of such Default or Event of
Default.

 

§14.11              Duties in
the Case of Enforcement.  In case
one of more Events of Default have occurred and shall be continuing, and
whether or not acceleration of the obligations shall have occurred, the Agent
shall, if (a) so requested by the Majority Lenders and (b) the Lenders have
provided to the Agent such additional indemnities and assurances against
expenses and liabilities as the Agent may reasonably request, proceed to
enforce the provisions of the Loan Documents and exercise all or any legal and
equitable and other rights or remedies as it may have. The Majority Lenders may
direct the Agent in writing as to the method and the extent of any such
exercise, the Lenders hereby agreeing to indemnify and hold the Agent harmless
from all liabilities incurred in respect of all actions taken or omitted in
accordance with such directions, provided that the Agent need not comply with
any such direction to the extent that the Agent reasonably believes the Agent’s
compliance with such direction to be unlawful or commercially unreasonable in
any applicable jurisdiction or would subject to the Agent to civil liability.

 

§15.                        EXPENSES.  The Borrower agrees to pay (a) any taxes
(including any interest and penalties in respect thereto) payable by the Agent
or any of the Lenders (other than taxes based upon the Agent’s or any Lender’s
net income), including any intangibles taxes in connection with the Loan
Documents, or other taxes payable on or with respect to the transactions
contemplated by this Agreement, including any taxes payable by the Agent or any
of the Lenders after the Closing Date (the Borrower hereby agreeing to
indemnify the Lenders with respect thereto), (b) the reasonable fees, expenses
and disbursements of the Agent’s counsel or any local counsel to the Agent
incurred in connection with the preparation, administration or interpretation
of the Loan Documents and other instruments mentioned herein, each closing
hereunder, and amendments, modifications, approvals, consents or waivers hereto
or hereunder, (c) the reasonable fees, costs, expenses and disbursements of the
Agent incurred in connection with the preparation, administration or
interpretation

 

46

 

of the Loan
Documents and other instruments mentioned herein, (d) the fees, costs, expenses
and disbursements of the Agent incurred in connection with the syndication
and/or participation of the Loans, (e) all reasonable out-of-pocket expenses
(including reasonable attorneys’ fees and costs, which attorneys may be
employees of any Lender or the Agent and the fees and costs of appraisers,
engineers, investment bankers, surveyors or other experts retained by the Agent
or any Lender in connection with any such enforcement proceedings) incurred by
any Lender or the Agent in connection with (i) the enforcement of or
preservation of rights under any of the Loan Documents against the Borrower or
the administration thereof after the occurrence of a Default or Event of
Default (including, without limitation, expenses incurred in any restructuring
and/or “workout” of the Loans), and (ii) any litigation, proceeding or dispute
whether arising hereunder or otherwise, in any way related to the Agent’s or
the Lender’s relationship with the Borrower, any Controlled Unconsolidated
Entity or any of the Related Companies, (f) all reasonable fees, expenses and
disbursements of the Agent incurred in connection with UCC searches, UCC
filings or mortgage recordings, (g) all reasonable costs incurred by the Agent
in the future in connection with its inspection of the Real Estate, and (h) the
reasonable fees, costs, expenses and disbursements of the Agent incurred in
connection with the granting of any collateral by the Borrower, including,
without limitation, the costs incurred by the Agent in connection with its
inspection of such collateral, and the fees and disbursements of the Agent’s
counsel. The covenants of this §15 shall survive payment or satisfaction of
payment of amounts owing with respect to the Notes.

 

§16.                        INDEMNIFICATION.  The Borrower agrees to indemnify and hold harmless the Agent and
the Lenders and the shareholders, directors, agents, officers, subsidiaries,
and affiliates of the Agent and the Lenders and any Person that controls the
Agent or any Lender from and against any and all claims, actions or causes of
action and suits whether groundless or otherwise, and from and against any and
all liabilities, losses, settlement payments, obligations, damages and expenses
of every nature and character arising out of this Agreement or any of the other
Loan Documents or the transactions contemplated hereby or which otherwise arise
in connection with the financing including, without limitation except to the
extent caused by the gross negligence or willful misconduct of a Lender or the
Agent as determined by a court of competent jurisdiction after the exhaustion
of all applicable appeal periods (but such limitation on indemnification shall
only apply to the Agent or Lender that is being grossly negligent or committing
willful misconduct), (a) any actual or proposed use by the Borrower of the
proceeds of any of the Loans, (b) any actual or alleged infringement of any
patent, copyright, trademark, service mark or similar right of the Borrower,
(c) the Borrower entering into or performing this Agreement or any of the other
Loan Documents or (d) with respect to the Borrower and its respective
properties, the violation of any Environmental Law, the Release or threatened
Release of any Hazardous Substances or any action, suit, proceeding or
investigation brought or threatened with respect to any Hazardous Substances
(including, but not limited to claims with respect to wrongful death, personal
injury or damage to property), (e) any cost, claim liability, damage or expense
in connection with any harm the Borrower may be found to have caused in the
role of a broker, in each case including, without limitation, the reasonable
fees and disbursements of counsel and allocated costs of internal counsel
incurred in connection with any such investigation, litigation or other
proceeding. In litigation, or the preparation therefor, the Lenders

 

47

 

and the Agent
shall each be entitled to select their own separate counsel and, in addition to
the foregoing indemnity, the Borrower agrees to pay promptly the reasonable
fees and expenses of such counsel. If, and to the extent that the obligations
of the Borrower under this §16 are unenforceable for any reason, the Borrower
hereby agrees to make the maximum contribution to the payment in satisfaction
of such obligations which is permissible under applicable law. The provisions
of this §16 shall survive the repayment of the Loans and the termination of the
obligations of the Lenders hereunder and shall continue in full force and
effect as to the Lenders so long as the possibility of any such claim, action,
cause of action or suit exists under applicable law, rule or regulation.

 

§17.                        SURVIVAL OF COVENANTS, ETC.  All covenants, agreements, representations
and warranties made herein, in the Notes, in any of the other Loan Documents or
in any documents or other papers delivered by or on behalf of the Borrower
pursuant hereto shall be deemed to have been relied upon by the Lenders and the
Agent, notwithstanding any investigation heretofore or hereafter made by it,
and shall survive the making by the Lenders of the Loans, as herein
contemplated, and shall continue in full force and effect so long as any amount
due under this Agreement or the Notes or any of the other Loan Documents
remains outstanding or the Lenders have any obligation to make any Loans. The
indemnification obligations of the Borrower provided herein and the other Loan
Documents shall survive the full repayment of amounts due and the termination
of the obligations of the Lenders hereunder and thereunder to the extent
provided herein and therein. All statements contained in any certificate
delivered to the Agent or any Lender at any time executed on behalf of the
Borrower pursuant hereto or in connection with the transactions contemplated
hereby shall constitute representations and warranties by the Borrower
hereunder.

 

§18.                        ASSIGNMENT; PARTICIPATIONS; ETC.

 

§18.1                    Conditions
to Assignment by Lenders.  Except as
provided herein, each Lender may assign to one or more Eligible Assignees all
or a portion of its interests, rights and obligations under this Agreement
(including all or a portion of its Facility Percentage and the same portion of
the Loans at the time owing to it, and the Notes held by it); provided that (a)
the Agent shall have given its prior written consent to such assignment except
that such consent shall not be needed with respect to an assignment from a
Lender to one of its Affiliated Lenders, (b) each such assignment shall be of a
constant, and not a varying, percentage of all the assigning Lender’s rights
and obligations under this Agreement, (c) each assignment shall be in an amount
of not less than $3,000,000 that is a whole multiple of $1,000,000, (d) each
Lender shall either assign its entire Commitment or shall retain, free of any
such assignment, an amount of its Commitment of not less $3,000,000 and (e) the
parties to such assignment shall execute and deliver to the Agent, for
recording in the Register (as hereinafter defined), an Assignment and
Acceptance, substantially in the form of Exhibit D hereto (an “Assignment and
Acceptance”) , together with any Notes subject to such assignment. Upon such
execution, delivery, acceptance and recording, from and after the effective
date specified in each Assignment and Acceptance, (i) the assignee thereunder
shall be a party hereto and, to the extent provided in such Assignment and
Acceptance, have the rights and obligations of a Lender hereunder, and (ii) the
assigning Lender shall, to the extent provided in such assignment and upon
payment to the Agent of the registration fee referred to in §18.3, be released
from its obligations under this Agreement.

 

48

 

§18.2                    Certain
Representations and Warranties; Limitations; Covenants.  By executing and delivering an Assignment
and Acceptance, the parties to the assignment thereunder confirm to and agree
with each other and the other parties hereto as follows: (a) other than the
representation and warranty that it is the legal and beneficial owner of the
interest being assigned thereby free and clear of any adverse claim, the
assigning Lender makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with this Agreement or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of this Agreement,
the other Loan Documents or any other instrument or document furnished pursuant
hereto; (b) the assigning Lender makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Borrower or any other Person primarily or secondarily liable in respect of any
of the Obligations, or the performance or observance by the Borrower or any
other Person primarily or secondarily liable in respect of any of the
obligations of any of their obligations under this Agreement or any of the
other Loan Documents or any other instrument or document furnished pursuant
hereto or thereto or the validity or enforceability or priority of any lien or
any Collateral; (c) such assignee confirms that it has received a copy of this
Agreement, together with copies of the most recent financial statements
referred to in §6.4 and §7.4 and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
such Assignment and Acceptance; (d) such assignee will, independently and
without reliance upon the assigning Lender, the Agent or any other Lender and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit and Collateral decisions in taking or not
taking action under this Agreement, (e) such assignee represents and warrants
that it is an Eligible Assignee; (f) such assignee appoints and authorizes the
Agent to take such action as “Agent” on its behalf and to exercise such powers
under this Agreement and the other Loan Documents as are delegated to the Agent
by the terms hereof or thereof, together with such powers as are reasonably
incidental thereto; (g) such assignee agrees that it will perform in accordance
with their terms all of the obligations that by the terms of this Agreement are
required to be performed by it as a Lender; and (h) such assignee represents
and warrants that it is legally authorized to enter into such Assignment and
Acceptance.

 

§18.3                    Register.  The Agent shall maintain a copy of each
Assignment and Acceptance delivered to it and a register or similar list (the
“Register”) for the recordation of the names and addresses of the Lenders and
the Facility Percentages of, and principal amount of the Loans owing to the
Lenders from time to time. The entries in the Register shall be conclusive, in
the absence of manifest error, and the Borrower, the Agent and the Lenders may
treat each Person whose name is recorded in the Register as a Lender hereunder
for all purposes of this Agreement. The Register shall be available for
inspection by the Borrower and the Lenders at any reasonable time and from time
to time upon reasonable prior notice. 
Upon each such recordation, the assigning Lender agrees to pay to the
Agent a registration fee in the sum of $5,000.00.  The Agent may amend Schedules 1 and 1.1 hereof to reflect
the recording of any such assignments.

 

§18.4                    New Notes.  Upon its receipt of an Assignment and
Acceptance executed by the parties to such assignment, together with each Note
subject to such assignment, the Agent shall (a) record the information
contained therein in the Register, and (b) give prompt notice thereof to the
Borrower and the Lenders (other than the assigning Lender). Within five (5)
Business Days

 

49

 

after receipt of such notice, the Borrower, at its own
expense, shall execute and deliver to the Agent, in exchange for each
surrendered Note, a new Note to the order of such Eligible Assignee in an
amount equal to the amount assumed by such Eligible Assignee pursuant to such Assignment
and Acceptance and, if the assigning Lender has retained some portion of its
Loans hereunder, a new Note to the order of the assigning Lender in an amount
equal to the amount retained by it hereunder. Such new Notes shall provide that
they are replacements for the surrendered Notes and that they do not constitute
a novation, shall be in an aggregate principal amount equal to the aggregate
principal amount of the surrendered Notes, shall be dated the effective date of
such Assignment and Acceptance and shall otherwise be in substantially the form
of the assigned Notes. The surrendered Notes shall be cancelled and returned to
the Borrower.

 

§18.5                    Participations.  Each Lender may sell participations to one
or more banks or other entities in a portion of such Lender’s rights and
obligations under this Agreement and the other Loan Documents not to exceed
forty-nine percent (49%) of its Facility Percentage; provided that (a) the
Agent shall have given its prior written consent to such participation, except
that any Lender may sell participations to its Affiliated Lenders without such
consent, (b) each such participation shall be in an amount of not less than
$3,000,000 that is a whole multiple of $1,000,000, (c) any such sale or
participation shall not affect the rights and duties of the selling Lender
hereunder to the Borrower and the Lender shall continue to exercise all
approvals, disapprovals and other functions of a Lender, (d) such participation
shall not entitle such participant to any rights or privileges under this
Agreement or the Loan Documents, including, without limitation, the right to
approve waivers, amendments or modifications, (e) such participant shall have
no direct rights against the Borrower except the rights granted to the Lenders
pursuant to §13, (f) such sale is effected in accordance with all applicable
laws, (g) such participant shall not be a Person controlling, controlled by or
under common control with, or which is not otherwise free from influence or
control by, the Borrower, any Related Company or any Unconsolidated Entity or
any affiliate thereof, and (h) no participant shall have the right to grant
further participations or assign its rights, obligations or interests under
such participation to other Persons without the prior written consent of the
Agent.

 

§18.6                    Pledge by
Lender.  Any Lender may at any
time pledge or assign all or any portion of its interest and rights under this
Agreement (including all or any portion of its Note) to any of the twelve
Federal Reserve Banks organized under Section 4 of the Federal Reserve
Act, 12 U.S.C. §341. No such pledge or the enforcement thereof shall release
the pledgor Lender from its obligations hereunder or under any of the other
Loan Documents.

 

§18.7                    No
Assignment by Borrower. 
The Borrower shall not assign or transfer any of its rights or
obligations under any of the Loan Documents without the prior written consent
of each of the Lenders.

 

§18.8                    Disclosure.  The Borrower agrees that in addition to
disclosures made in accordance with standard banking practices any Lender may
disclose information obtained by such Lender pursuant to this Agreement to
assignees or participants and potential assignees or participants hereunder.

 

50

 

§19.                        NOTICES, ETC. 
Except as otherwise expressly provided in this Agreement, all notices
and other communications made or required to be given pursuant to this
Agreement or the Notes shall be in writing and shall be delivered in hand,
mailed by United States registered or certified first class mail, postage
prepaid, sent by overnight courier, or sent by telegraph, telecopy, telefax or
telex and confirmed by delivery via courier or postal service, addressed as
follows:

 

(a)                                  if
to the Borrower, at 1780 S. Bellaire Street, Suite 515, Denver, CO 80222
Attention: Chief Financial Officer, Telefax No. 303-296-7353 or at such other
address for notice as the Borrower shall last have furnished in writing to the
Agent; and

 

(b)                                 if
to the Agent, at 100 Federal Street, Boston, Massachusetts 02110, Attention:
Structured Real Estate, and to 115 Perimeter Center Place, N.E., Suite 500,
Atlanta, Georgia 30346, Attn: George Ojanuga, Director, Telefax No.
770-390-8434 or such other address for notice as the Agent shall last have furnished
in writing to the Borrower.

 

(c)                                  if
to any Lender, at such Lender’s address set forth on such Lender’s signature
page, or such other address for notice as such Lender shall have last furnished
in writing to the Person giving the notice.

 

Any such notice or demand shall be deemed to
have been duly given or made and to have become effective (i) if delivered by
hand, overnight courier or facsimile to a responsible officer of the party to
which it is directed, at the time of the receipt thereof by such officer or the
sending of such facsimile (as evidenced by confirmation of successful
transmission) and (ii) if sent by registered or certified first-class mail,
postage prepaid, on the third Business Day following the mailing thereof.

 

§20.                        GOVERNING LAW; CONSENT TO JURISDICTION AND SERVICE.  This agreement and each of the other Loan
Documents, except as otherwise specifically provided therein, and the rights
and obligations of the parties hereunder shall be construed and interpreted in
accordance with the laws of the Commonwealth Of Massachusetts (excluding the
laws applicable to conflicts or choice of law). BORROWER AGREES THAT ANY SUIT
BY IT FOR THE ENFORCEMENT OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS
MAY BE BROUGHT ONLY IN THE COURTS OF THE COMMONWEALTH OF MASSACHUSETTS OR ANY
FEDERAL COURT SITTING THEREIN AND BORROWER CONSENTS TO THE NONEXCLUSIVE
JURISDICTION OF SUCH COURT FOR ANY SUIT BY AGENT OR ANY LENDER AND THE SERVICE
OF PROCESS IN ANY SUCH SUIT BEING MADE UPON THE BORROWER BY MAIL AT THE ADDRESS
SPECIFIED IN §19. BORROWER HEREBY WAIVES ANY OBJECTION THAT IT MAY NOW OR
HEREAFTER HAVE TO THE VENUE OF ANY SUCH SUIT OR ANY SUCH COURT OR THAT SUCH
SUIT IS BROUGHT IN AN INCONVENIENT FORUM. IN ADDITION TO THE COURTS OF THE
COMMONWEALTH OR ANY FEDERAL COURT SITTING THEREIN, THE AGENT OR ANY LENDER MAY
BRING ACTION(S) FOR ENFORCEMENT ON A NONEXCLUSIVE BASIS WHERE ANY COLLATERAL
EXISTS AND THE BORROWER CONSENTS TO THE NON-EXCLUSIVE JURISDICTION OF SUCH
COURTS AND THE SERVICE OF PROCESS IN ANY SUCH SUIT BEING MADE UPON THE BORROWER
BY MAIL AT THE ADDRESS SPECIFIED IN §19.

 

51

 

§21.                        HEADINGS.  The captions in this Agreement are for
convenience of reference only and shall not define or limit the provisions hereof.

 

§22.                        COUNTERPARTS.  This Agreement and any amendment hereof may
be executed in several counterparts and by each party on a separate
counterpart, each of which when so executed and delivered shall be an original,
and all of which together shall constitute one instrument. In proving this
Agreement it shall not be necessary to produce or account for more than one
such counterpart signed by the party against whom enforcement is sought.

 

§23.                        ENTIRE AGREEMENT.  This Agreement and the Loan Documents is intended by the parties
as the final, complete and exclusive statement of the transactions evidenced by
this Agreement and the Loan Documents. 
All prior or contemporaneous promises, agreements and understandings, whether
oral or written, are deemed to be superceded by this Agreement and the Loan
Documents, and no party is relying on any promise, agreement or understanding
not set forth in this Agreement and the Loan Documents. Neither this Agreement
nor any term hereof may be changed, waived, discharged or terminated, except as
provided in §25.

 

§24.                        WAIVER OF JURY TRIAL AND CERTAIN DAMAGE CLAIMS.  THE BORROWER, THE AGENT AND EACH LENDER
HEREBY MUTUALLY HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT
TO A TRIAL BY JURY IN RESPECT OF ANY CLAIM BASED HEREON, ARISING OUT OF, UNDER
OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER LOAN DOCUMENTS CONTEMPLATED
TO BE EXECUTED IN CONNECTION HEREWITH OR ANY COURSE OF CONDUCT, COURSE OF
DEALINGS, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY,
INCLUDING, WITHOUT LIMITATION, ANY COURSE OF CONDUCT, COURSE OF DEALINGS,
STATEMENTS OR ACTIONS OF AGENT OR THE LENDERS RELATING TO THE ADMINISTRATION OF
THE LOANS OR ENFORCEMENT OF THE LOAN DOCUMENTS, AND AGREE THAT NO PARTY WILL
SEEK TO CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER ACTION IN WHICH A JURY TRIAL
CANNOT BE OR HAS NOT BEEN WAIVED. 
EXCEPT AS PROHIBITED BY LAW, BORROWER HEREBY WAIVES ANY RIGHT IT MAY
HAVE TO CLAIM OR RECOVER IN ANY LITIGATION ANY SPECIAL, EXEMPLARY, PUNITIVE OR
CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL
DAMAGES.  BORROWER CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF AGENT OR ANY LENDER HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT AGENT OR ANY LENDER WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER.  THIS WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR LENDERS TO
PROVIDE THE COMMITMENTS AND MAKE THE LOANS.

 

§25.                        CONSENTS, AMENDMENTS, WAIVERS, ETC. 
Except as otherwise expressly provided in this Agreement, any consent or
approval required or permitted by this Agreement may be given, and any term of
this Agreement or of any other instrument related hereto or mentioned herein
may be amended, and the performance or observance by the Borrower of any terms
of this Agreement or such other instrument or the continuance of any Default or
Event of Default may be waived (either generally or in a particular instance
and either retroactively or prospectively) with, but only with, the written
consent of the Majority Lenders.  Notwithstanding

 

52

 

the foregoing, none of the
following may occur without the written consent of each Lender:  a decrease in the rate of interest on and
the term of the Notes; an increase in the amount of the Commitments of the
Lenders; a forgiveness, reduction or waiver of the principal of any unpaid Loan
or any interest thereon or fee payable to the Lenders under the Loan Documents;
the postponement of any date fixed for any payment of principal of or interest
on the Loan; an extension of the Maturity Date; a change in the manner of
distribution of any payments to the Lenders or the Agent; the release of the
Borrower; an amendment of the definition of Majority Lenders or of any
requirement for consent by all of the Lenders; any modification to require a
Lender to fund a pro rata share of a request for an advance of the
Loan made by the Borrower other than based on its Facility Percentage; an
amendment to this §25; or an amendment of any provision of this Agreement or
the Loan Documents which requires the approval of all of the Lenders or the
Majority Lenders to require a lesser number of Lenders to approve such
action.  No waiver shall extend to or
affect any obligation not expressly waived or impair any right consequent
thereon. No course of dealing or delay or omission on the part of the Agent or
any Lender in exercising any right shall operate as a waiver thereof or
otherwise be prejudicial thereto.  No
notice to or demand upon the Borrower shall entitle the Borrower to other or
further notice or demand in similar or other circumstances.

 

§26.                        SEVERABILITY. 
The provisions of this Agreement are severable, and if any one clause or
provision hereof shall be held invalid or unenforceable in whole or in part in
any jurisdiction, then such invalidity or unenforceability shall affect only
such clause or provision, or part thereof, in such jurisdiction, and shall not
in any manner affect such clause or provision in any other jurisdiction, or any
other clause or provision of this Agreement in any jurisdiction.

 

§27.                        RELATIONSHIP. 
Neither the Agent nor any Lender has any fiduciary relationship with or
fiduciary duty to the Borrower arising out of or in connection with the
Agreement or the other Loan Documents or the transactions contemplated
hereunder and thereunder, and the relationship between each Lender and the
Borrower is solely that of a lender and borrower, and nothing contained herein
or in any of the other Loan Documents shall in any manner be construed as making
the parties hereto partners, joint venturers or any other relationship other
than lender and borrower.

 

§28.                        DEALINGS WITH THE BORROWER. 
The Agent, the Lenders and their affiliates may accept deposits from,
extend credit to and generally engage in any kind of banking, trust or other
business with the Borrower or any of its affiliates or Subsidiaries regardless
of the capacity of the Agent or the Lenders hereunder.

 

§29.                        NO UNWRITTEN AGREEMENTS.  THE WRITTEN LOAN DOCUMENTS REPRESENT THE
FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.  THERE ARE NO UNWRITTEN ORAL AGREEMENTS
BETWEEN THE PARTIES.

 

§30.                        TIME OF THE ESSENCE. 
Time is of the essence with respect to each and every covenant,
agreement and obligation of the Borrower under this Agreement and the other
Loan Documents.

 

53

 

§31.                        RIGHTS OF THIRD PARTIES.

 

(a)                                  This
Agreement and the other Loan Documents are made and entered into for the sole
protection and legal benefit of the Borrower, the Lenders, and the Agent, and
their permitted successors and assigns, and no other Person shall be a direct
or indirect legal beneficiary of, or have any direct or indirect cause of
action or claim in connection with, this Agreement or any of the other Loan
Documents.

 

(b)                                 All
conditions to the performance of the obligations of the Agent and the Lenders
under this Agreement, including the obligation to make Loans, are imposed
solely and exclusively for the benefit of the Agent and the Lenders and no
other Person shall have standing to require satisfaction of such conditions in
accordance with their terms or be entitled to assume that the Agent and the
Lenders will refuse to make advances of proceeds of 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 and all of
which may be freely waived in whole or in part by the Agent and the Lenders at
any time if in their sole discretion they deem it desirable to do so.

 

[SIGNATURES
BEGIN ON FOLLOWING PAGE]

 

54

 

IN WITNESS WHEREOF, the undersigned have duly
executed this Agreement as a sealed instrument as of the date first set forth
above.

 

	
   

  	
  BORROWER:

  
	
   

  	
   

  
	
   

  	
  AMERIVEST PROPERTIES INC., a Maryland

  corporation

  
	
   

  	
   

  
	
   

  	
  By:

  	
  John B. Greenman

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  	
  John B. Greenman

  	
   

  
	
   

  	
   

  
	
   

  	
  Title:

  	
  Vice President

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  AGENT:

  
	
   

  	
   

  
	
   

  	
  FLEET NATIONAL BANK, as Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  George Ojanuga

  	
   

  
	
   

  	
  Name: 
  George Ojanuga

  
	
   

  	
  Title: 
  Director

  
							

 

55

 

Lender Signature Page

 

	
   

  	
  FLEET NATIONAL BANK

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  George Ojanuga

  	
   

  
	
   

  	
  Name: 
  George Ojanuga

  
	
   

  	
  Title: 
  Director

  

 

	
  Commitment:

  	
   

  	
  $

  	
  30,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Facility Percentage:

  	
   

  	
  100

  	
  %

  

 

 

	
   

  	
  Notice Address:

  
	
   

  	
   

  
	
   

  	
  Fleet National Bank

  
	
   

  	
  100 Federal Street

  
	
   

  	
  Boston, MA 
  02110

  
	
   

  	
  Attn: Structured Real Estate

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  With a copy to:

  
	
   

  	
   

  
	
   

  	
  Fleet National Bank.

  
	
   

  	
  115 Perimeter Center Place, N.E.

  
	
   

  	
  Suite 500

  
	
   

  	
  Atlanta, GA 30346

  
	
   

  	
  Attn: George Ojanuga, Vice President

  
	
   

  	
  Fax: 
  (770)390-8434 or 391-9811

  

 

56Exhibit 10.12B

 

REVOLVING
CREDIT NOTE

 

	
  $30,000,000.00

  	
   

  	
  December
  15, 2003

  

 

FOR VALUE RECEIVED, the undersigned, AMERIVEST PROPERTIES INC., a
Maryland corporation (the “Borrower”), promises to pay, without offset or
counterclaim,  to the order of FLEET
NATIONAL BANK (hereinafter, together with its successors in title and assigns,
called the “Lender”) at the head office of Fleet National Bank, as Agent (the
“Agent”) at 100 Federal Street, Boston, Massachusetts 02110 or at such other
address as Agent may specify, the principal sum of THIRTY MILLION AND NO/100
DOLLARS ($30,000,000.00) or, if less, the aggregate unpaid principal amount of
all Loans made by the Lender to the Borrower pursuant to the Unsecured
Revolving Credit Agreement dated as of December 15, 2003 among the Lender, the
Borrower,  the other lending
institutions named therein and the Agent, as amended from time to time (the
“Credit Agreement”).  Capitalized terms
used herein and not otherwise defined herein shall have the meanings assigned
to them in the Credit Agreement.  Unless
otherwise provided herein, the rules of interpretation set forth in §1.2 of the
Credit Agreement shall be applicable to this Note.

 

The Borrower also promises
to pay (a) principal from time to time at the times provided in the Credit
Agreement and (b) interest from the date hereof on the principal amount from
time to time unpaid at the rates and times set forth in the Credit Agreement
and in all cases in accordance with the terms of the Credit Agreement.  Late charges and other charges and default
rate interest shall be paid by Borrower in accordance with the terms of the
Credit Agreement.  The entire
outstanding principal amount of this Note, together with all accrued but unpaid
interest thereon, shall be due and payable in full on the Maturity Date.  The Lender may endorse the record relating
to this Note with appropriate notations evidencing advances and payments of
principal hereunder as contemplated by the Credit Agreement.

 

This Note is issued pursuant
to, is entitled to the benefits of, and is subject to the provisions of the
Credit Agreement.  The principal of this
Note is subject to prepayment in whole or in part in the manner and to the
extent specified in the Credit Agreement. 
The principal of this Note, the interest accrued on this Note and all
other Obligations of the Borrower are full recourse obligations of the
Borrower, and all of its Real Estate Assets, and its other properties shall be
available for the payment and performance of this Note, the interest accrued on
this Note, and all of such other Obligations. 
In case an Event of Default shall occur and be continuing, the entire
unpaid principal amount of this Note and all of the unpaid interest accrued
thereon may become or be declared due and payable in the manner and with the
effect provided in the Credit Agreement.

 

Notwithstanding anything in
this Note to the contrary, all agreements between the Borrower and the Lenders
and the Agent, whether now existing or hereafter arising and whether written or
oral, are hereby limited so that in no contingency, whether by reason of
acceleration of the maturity of any of the Obligations or otherwise, shall the
interest contracted for, charged or received by the Lenders exceed the maximum
amount permissible under applicable law. 
If, from any circumstance whatsoever, interest would otherwise by
payable to the Lenders in excess of

 

 

the maximum lawful amount, the
interest payable to the Lenders shall be reduced to the maximum amount
permitted under applicable law; and if from any circumstance the Lenders shall
ever receive anything of value deemed interest by applicable law in excess of
the maximum lawful amount, an amount equal to any excessive interest shall be
applied to the reduction of the principal balance of the Obligations and to the
payment of interest or, if such excessive interest exceeds the unpaid balance
of principal of the Obligations, such excess shall be refunded to the
Borrower.  All interest paid or agreed
to be paid to the Lenders shall, to the extent permitted by applicable law, be
amortized, prorated, allocated and spread throughout the full period until
payment in full of the principal of the Obligations (including the period of
any renewal or extension thereof) so that the interest thereon for such full
period shall not exceed the maximum amount permitted by applicable law.  This section shall control all agreements
between the Borrower and the Lenders and the Agent.

 

The Borrower and all
endorsers hereby waive presentment, demand, protest and notice of any kind in
connection with the delivery, acceptance, performance and enforcement of this
Note, and also hereby assent to extensions of time of payment or forbearance or
other indulgences without notice.

 

This Note and the obligations of the Borrower hereunder shall
be governed by and interpreted and determined in accordance with the laws of
the Commonwealth of Massachusetts (excluding the laws applicable to conflicts
or choice of law).  The Borrower has
waived its right to a jury trial with respect to any action or claim arising
out of this Note pursuant to §24 of the Credit Agreement.

 

IN WITNESS WHEREOF, the
Borrower has caused this Note to be duly executed in its name as an instrument
under seal on the date first above written.

 

	
  WITNESS:

  	
  AMERIVEST
  PROPERTIES INC.,

  
	
   

  	
  a
  Maryland corporation

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Jean
  M. Gonzales

  	
   

  	
  By:

  	
  John B. Greenman

  
	
   

  	
   

  	
  Name:

  	
   John
  B. Greenman

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (CORPORATE
  SEAL)

  
							

 

2

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