Document:

exv10w1

 

Exhibit 10.1

FIRST AMENDMENT TO LEASE

     THIS FIRST AMENDMENT TO LEASE (“Amendment”) made as of the 26th day of
February, 2004, by and between LASALLE BANK NATIONAL ASSOCIATION, as successor
trustee (“Trustee”) to AMERICAN NATIONAL BANK AND TRUST COMPANY OF CHICAGO, as
Trustee under Trust Agreement (“Trust”) dated January 1, 1991 and known as
Trust No. 113370-03 (“Landlord”) and BIOSANTE PHARMACEUTICALS, INC. (“Tenant”).

W I T N E S S E T H:

     WHEREAS, Landlord and Tenant entered into that certain Lease dated
December 19, 2003 (the “Lease”), which Lease demised to Tenant a portion of the
2nd floor, known as Suite 280 (“Premises”) of the building known as 111 Barclay
Boulevard, Lincolnshire, Illinois (“Building”); and

     WHEREAS, the parties hereto desire to relocate the Premises to another
part of the Building and to amend the Lease in certain other respects.

     NOW, THEREFORE, in consideration of the mutual covenants and conditions
contained herein, the Lease is hereby further amended as follows:

     1. New Premises. As of March 19, 2004 (“Availability Date”), Tenant shall
be entitled to full and unencumbered possess of the space containing 6,801
rentable square feet on the 2nd floor described on attached Exhibit A and now
commonly known as Suite 210 (“New Premises”), with the Landlord’s Work (as
defined hereafter) completed. Between the Availability Date and April 1, 2004,
Tenant shall vacate and deliver possession of the Premises containing 4,034
rentable square feet (“Old Premises”) to Landlord and Tenant shall fully take
possession of the New Premises (the date on which Tenant fully vacates the Old
Premises and takes possession of the new Premises is the “Relocation Date”).
From and after the Relocation Date, all references to the “Premises” under the
Lease shall mean the New Premises and the New Premises shall be known as Suite
280 in the Building. If Tenant does not vacate the Old Premises within ten
(10) business days after April 1, 2004, Tenant shall be deemed in default under
the Lease, and Landlord shall have all of its remedies under the Lease. Tenant
shall remain liable for the full and faithful performance of its obligations
and for payment of all amounts which may be due and payable under the Lease for
the Old Premises through the Relocation Date. Notwithstanding anything
contained in the Lease to the contrary, but subject to the provisions of
Section 7 of the Lease, Tenant shall have no duty to restore the condition (or
pay for the restoration) of the Old Premises prior to, or after, Tenants
vacation of same.

     2. Landlord’s Work and Condition of New Premises. Prior to the
Availability Date, Landlord shall clean the carpeting in the New Premises, and
shall arrange for a third party contractor to paint and drywall a portion of
the New Premises near the reception area (collectively “Landlord’s Work”).
Landlord shall, at Landlords’ sole cost and expense, and not as an Expense, pay
for the cleaning of the carpeting in the New Premises. Tenant shall reimburse
Landlord for the cost of painting and installing the aforementioned drywall in
the New Premises, the sum of Sixteen Thousand Two Hundred Forty Six and no/100
Dollars ($16,246.00) within thirty (30) days after receiving an invoice
therefor from Landlord. Such sum shall be

 

 

deemed to be Additional Rent under the Lease. Tenant has inspected the
New Premises and agrees, except for Landlord’s Work, to accept possession of
the New Premises in current “as is” condition. If delivery of possession is
delayed and the Availability Date is other than March 19 2004, Landlord shall
give Tenant written confirmation of the Availability Date once possession is
delivered.

     3. Amended Term. The term of the Lease is hereby amended so that the term
shall expire on the later to occur (“Termination Date”) of (i) March 18, 2005,
or (ii) one (1) year after the Relocation Date, unless sooner terminated
pursuant to the terms of the Lease.

     4. Base Rent. As of the Relocation Date, the Base Rent payable under the
Lease shall be as follows:

	 	 	 	 	 	 	 	 	 
	 	 	Annual	 	Monthly
	 Period
	 	Base Rent
	 	Installment

	Relocation Date -
	 	$	88,413.00	 	 	$	7,367.75	 
	Termination Date
	 	 	 	 	 	 	 	 

     5. 2004 Additional Rent Adjustment. Notwithstanding anything in the Lease
to the contrary, but expressly subject to the terms of Section 1 hereof, Tenant
shall continue to pay the Additional Rent to be paid by Tenant pursuant to
Section 2 of the Lease solely for the Old Premises until the Relocation Date.
Thereafter, Tenant shall pay the Additional Rent to be paid by Tenant pursuant
to Section 2 of the Lease solely for the New Premises until the Termination
Date.

     6. Tenant’s Proportionate Share. As of the Relocation Date, Tenant’s
Proportionate Share shall increase from 5.16% to 8.698%. For the purposes of
the Lease, the “Rentable Area of the Building” shall mean 78,182 stipulated
rentable square feet.

     7. Security Deposit. As of the Relocation Date, Tenant’s Security Deposit
shall increase from $7,113.29 to $11,992.43.

     8. Real Estate Brokers. Tenant represents that it has dealt with, and only
with, Van Vlissingen and Co., as broker in connection with this Amendment, and
that, insofar as Tenant knows, no other broker negotiated this Amendment or is
entitled to any commission in connection therewith. Tenant agrees to indemnify
and hold Landlord harmless from all damages, liability and expense (including
reasonable attorneys’ fees) arising from any claims or demands of any other
broker or brokers or finders in connection with its participating with Tenant
in the negotiating of this Amendment.

     9. Lease in Full Force and Effect. Except for the provisions of this
Amendment, all the terms, covenants and conditions of the Lease and all the
rights and obligations of Landlord and Tenant thereunder, shall remain in full
force and effect, and are not otherwise altered, amended, revised or changed.

     10. Estoppel. Tenant and Landlord hereby each acknowledge that as of the
date hereof, they have no claims arising under the Lease against the other
party or its agents, or any one or more of the foregoing, and that neither
knows of any default or failure on the part of the other

 

 

party to keep or perform any covenant, condition or undertaking to be kept
or performed by such other party under the Lease.

     11. Exculpatory Provisions. It is expressly understood and agreed by and
between the parties hereto, anything herein to the contrary notwithstanding,
that each and all of the representations, warranties, covenants, undertakings
and agreements herein made on the part of any Landlord while in form purporting
to be the representations, warranties, covenants, undertakings, and agreements
of such Landlord are nevertheless each and every one of them made and intended,
not as personal representations, warranties, covenants, undertakings, and
agreements by such Landlord or for the purpose or with the intention of binding
such Landlord personally, but are made and intended for the purpose only of
subjecting such Landlord’s interest in the Building, the Land and the Premises
to the terms of this Amendment and for no other purpose whatsoever, and in case
of default hereunder by any Landlord (or default through, under, or by any of
its agents or representatives), the Tenant shall look solely to the interests
of such Landlord in the Building and Land; that neither Landlord nor LaSalle
Bank National Association, as Successor Trustee of Trust No 113370-03 shall
have any personal liability to pay any indebtedness accruing hereunder or to
perform any covenant, either express or implied, herein contained and no
liability or duty shall rest upon any Landlord which is a land trust to
sequester the trust estate or the rents, issues and profits arising therefrom,
or the proceeds arising from any sale or other disposition thereof; that no
personal liability or personal responsibility of any sort is assumed by, nor
shall at any time be asserted or enforceable against, Landlord, LaSalle Bank
National Association, as Successor Trustee under Trust No. 113370-03 or any
beneficiaries under any land trust which may become the owner of the Building,
on account of this Amendment or on account of any representation, warranty,
covenant, undertaking or agreement of Landlord in this Amendment contained,
either express or implied, all such personal liability, if any, being expressly
waived and released by Tenant and by all persons claiming by, through, or under
Tenant; and that this Amendment is executed and delivered by the undersigned
Landlord not in its own right, but solely in the exercise of the powers
conferred upon it as such Successor Trustee.

 

 

     IN WITNESS WHEREOF, the parties have caused this Amendment to be executed
on the date first above written

	 	 	 	 	 
	 	 	LANDLORD:
	 
	 	 	 	 
	 	 	LASALLE BANK
NATIONAL

ASSOCIATION, as successor trustee to

AMERICAN NATIONAL BANK AND

TRUST COMPANY OF CHICAGO, as

Trustee under Trust No. 113370-03
and not personally
	ATTEST:
	 	 	 	 
	 
	 	 	 	 
	Attestation not required by LaSalle Bank

National Association Bylaws

	 	By:
	 	  /s/ Kathleen E. Shuide

	

	 	Its:
	 	  Trust Officer
	 
	 	 	 	 
	 	 	TENANT:
	 
	 	 	 	 
	 	 	BIOSANTE PHARMACEUTICALS, INC.
	ATTEST:
	 	 	 	 
	 
	 	 	 	 
	

	 	By:
	 	  /s/ Phillip B. Donenberg

	/s/ Stephen M. Simes

	 	Its:
	 	  CFO

 

 

EXHIBIT A

[Diagram of 111 Barclay Boulevard, Suite 210]exv10w15

 

Exhibit 10.15

REVOLVING CREDIT AGREEMENT

by and between

GOVERNMENT PROPERTIES TRUST, INC.,

a Maryland Corporation,

and

FIRST NATIONAL BANK OF OMAHA,

a national banking association

April 28, 2004

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 	 	 	 	 	 	 
	Section 1:	 	Definitions & Terms	 	 	1	 
	Section 2:	 	Revolving Facility	 	 	6	 
	

	 	 	2.1	 	 	 	 	Advances
	 	 	6	 
	

	 	 	2.2	 	 	 	 	Interest and Principal Payments
	 	 	7	 
	

	 	 	2.3	 	 	 	 	Default Rate
	 	 	9	 
	

	 	 	2.4	 	 	 	 	Late Fee
	 	 	9	 
	

	 	 	2.5	 	 	 	 	Interest Calculations
	 	 	9	 
	

	 	 	2.6	 	 	 	 	Maximum Rate; Usury
	 	 	10	 
	

	 	 	2.7	 	 	 	 	Order of Application
	 	 	10	 
	

	 	 	2.8	 	 	 	 	Offset
	 	 	11	 
	

	 	 	2.9	 	 	 	 	Taxes
	 	 	11	 
	Section 3:	 	Borrowing Procedure	 	 	12	 
	

	 	 	3.1	 	 	 	 	Deposit Advances
	 	 	12	 
	

	 	 	3.2	 	 	 	 	Conditions Precedent to Deposit Advances
	 	 	12	 
	

	 	 	3.3	 	 	 	 	Acquisition Advances
	 	 	13	 
	

	 	 	3.4	 	 	 	 	Conditions Precedent to Acquisition Advances
	 	 	17	 
	

	 	 	3.5	 	 	 	 	Expenses
	 	 	18	 
	Section 4:	 	Fees	 	 	19	 
	

	 	 	4.1	 	 	 	 	Treatment of Fees
	 	 	19	 
	

	 	 	4.2	 	 	 	 	Origination Fee
	 	 	19	 
	

	 	 	4.3	 	 	 	 	Advance Fees
	 	 	19	 
	

	 	 	4.4	 	 	 	 	Payment of Fees
	 	 	19	 
	Section 5:	 	Conditions Precedent	 	 	20	 
	

	 	 	5.1	 	 	 	 	Conditions Precedent to Closing
	 	 	20	 
	

	 	 	5.2	 	 	 	 	Conditions Precedent to All Advances
	 	 	20	 
	Section 6:	 	Representations and Warranties	 	 	21	 
	

	 	 	6.1	 	 	 	 	Purpose of Credit Facility
	 	 	21	 
	

	 	 	6.2	 	 	 	 	Status as REIT
	 	 	22	 
	

	 	 	6.3	 	 	 	 	Existence, Good Standing, Authority and Authorizations
	 	 	22	 
	

	 	 	6.4	 	 	 	 	Authorization and Contravention
	 	 	23	 
	

	 	 	6.5	 	 	 	 	Binding Effect
	 	 	23	 
	

	 	 	6.6	 	 	 	 	Financial Statements
	 	 	23	 
	

	 	 	6.7	 	 	 	 	Litigation, Claims, Investigations
	 	 	24	 
	

	 	 	6.8	 	 	 	 	Taxes
	 	 	24	 
	

	 	 	6.9	 	 	 	 	ERISA Compliance
	 	 	24	 
	

	 	 	6.10	 	 	 	 	Properties; Liens
	 	 	24	 
	

	 	 	6.11	 	 	 	 	No Default
	 	 	25	 
	Section 7:	 	Covenants	 	 	25	 
	

	 	 	7.1	 	 	 	 	Use of Proceeds
	 	 	25	 
	

	 	 	7.2	 	 	 	 	Books and Records
	 	 	25	 
	

	 	 	7.3	 	 	 	 	Items to be Provided
	 	 	25	 

i

 

	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	 	 	7.4	 	 	 	 	Inspections
	 	 	27	 
	

	 	 	7.5	 	 	 	 	Taxes

	 	 	27	 
	

	 	 	7.6	 	 	 	 	Material Obligations
	 	 	27	 
	

	 	 	7.7	 	 	 	 	Maintenance of Existence, Assets and Business
	 	 	27	 
	

	 	 	7.8	 	 	 	 	Insurance
	 	 	28	 
	

	 	 	7.9	 	 	 	 	Investments
	 	 	28	 
	

	 	 	7.10	 	 	 	 	Compliance with Laws and Documents
	 	 	28	 
	

	 	 	7.11	 	 	 	 	Assignment
	 	 	28	 
	

	 	 	7.12	 	 	 	 	Permitted Distributions
	 	 	28	 
	

	 	 	7.13	 	 	 	 	Mergers and Dissolutions
	 	 	29	 
	

	 	 	7.14	 	 	 	 	Financial Covenants
	 	 	29	 
	Section 8:	 	Default	 	 	29	 
	

	 	 	8.1	 	 	 	 	Payment of Obligation
	 	 	29	 
	

	 	 	8.2	 	 	 	 	Covenants
	 	 	29	 
	

	 	 	8.3	 	 	 	 	Debtor Relief
	 	 	30	 
	

	 	 	8.4	 	 	 	 	Misrepresentation
	 	 	30	 
	

	 	 	8.5	 	 	 	 	Suits
	 	 	30	 
	

	 	 	8.6	 	 	 	 	Default Under Other Agreements
	 	 	31	 
	

	 	 	8.7	 	 	 	 	Employee Benefit Plans
	 	 	31	 
	Section 9:	 	Remedies Upon Default	 	 	31	 
	

	 	 	9.1	 	 	 	 	Extensions of Credit
	 	 	31	 
	

	 	 	9.2	 	 	 	 	Acceleration
	 	 	31	 
	

	 	 	9.3	 	 	 	 	Performance by Lender
	 	 	32	 
	

	 	 	9.4	 	 	 	 	Course of Dealing
	 	 	32	 
	

	 	 	9.5	 	 	 	 	Cumulative Rights
	 	 	33	 
	

	 	 	9.6	 	 	 	 	Application of Proceeds
	 	 	33	 
	

	 	 	9.7	 	 	 	 	Certain Proceedings
	 	 	33	 
	

	 	 	9.8	 	 	 	 	Expenditures by Lender
	 	 	33	 
	Section 10:	 	Miscellaneous	 	 	34	 
	

	 	 	10.1	 	 	 	 	Headings
	 	 	34	 
	

	 	 	10.2	 	 	 	 	Modifications, Consents and Waivers
	 	 	34	 
	

	 	 	10.3	 	 	 	 	Entire Agreement
	 	 	35	 
	

	 	 	10.4	 	 	 	 	Addresses for Notices
	 	 	35	 
	

	 	 	10.5	 	 	 	 	Binding Effect and Assignment
	 	 	36	 
	

	 	 	10.6	 	 	 	 	Governing Law
	 	 	36	 
	

	 	 	10.7	 	 	 	 	Number and Gender; Additional References
	 	 	37	 
	

	 	 	10.8	 	 	 	 	Waiver of Notices
	 	 	38	 
	

	 	 	10.9	 	 	 	 	Indemnification
	 	 	38	 
	

	 	 	10.10	 	 	 	 	Partial Invalidity
	 	 	39	 
	

	 	 	10.11	 	 	 	 	Counterparts
	 	 	39	 
	

	 	 	10.12	 	 	 	 	Participant
	 	 	39	 

ii

 

REVOLVING CREDIT AGREEMENT

     This revolving credit agreement (“Agreement”) is made and entered into as
of the 28th day of April, 2004 by and between Government Properties Trust,
Inc., a corporation duly organized and existing under and by virtue of the laws
of the State of Maryland (“Borrower”), having its principal place of business
at 10250 Regency Circle, Suite 100, Omaha, Nebraska 68114-3754, and FIRST
NATIONAL BANK OF OMAHA, a national banking association (“Lender”), whose
address is 1620 Dodge Street, Stop 4300, Omaha, Nebraska 68197-4300, ATTN:
Mortgage Loan Department, witnesseth:

SECTION 1. DEFINITIONS AND TERMS

     As used in this Agreement, the following terms shall have the meanings set
out respectively after each:

	 	 	ACQUISITION ADVANCE — A loan of funds made by Lender to Borrower or a
Subsidiary pursuant to this Agreement for the purpose of facilitating the
purchase of a Property by Borrower.
	 
	 	 	ADVANCE — An Acquisition Advance or a Deposit Advance.
	 
	 	 	AGGREGATE MINIMUM DEBT SERVICE COVERAGE RATIO — The quotient of a
fraction, the numerator of which fraction is the annual net operating
income derived from all Properties and the denominator of which fraction
is the actual annual debt service for all such Properties. For purposes
of this definition, the annual net operating income shall consist of all
rental income payable pursuant to the Property Lease(s) relating to a
Property, as determined on an annual basis, less those operating expenses
required to be paid by the lessor pursuant to such Property Lease(s) for
the same annual term (without deduction for depreciation and
amortization).
	 
	 	 	ASSIGNMENT OF RENTS AND LEASES — An Assignment of Rents and Leases from
Borrower or a Subsidiary to Lender, substantively similar to Exhibit “A”
attached hereto and by this reference incorporated herein.
	 
	 	 	BORROWING DATE — The date established by a Request for Advance as the
closing date for an Advance.
	 
	 	 	BUSINESS DAY — Any day other than a Saturday, Sunday, or any other day on
which banking institutions are required or authorized by law to be closed
in Nebraska.
	 
	 	 	CAPITAL LEASE — Any capital lease or sublease that should be capitalized
on a balance sheet in accordance with GAAP.

1

 

	 	 	CODE — The Internal Revenue Code, as amended, together with rules and
regulations promulgated thereunder.

	 	 	COLLATERAL — (i) A parcel of real property acquired by Borrower or a
Subsidiary with an Acquisition Advance, including any and all items of
goods, inventory, equipment, furniture, fixtures, contract rights,
general intangibles, and books and records relating to each such parcel
of real property; (ii) An account (“FNCM Account”) established by
Borrower with First National Capital Markets, Inc. (“FNCM”) to secure
repayment of Deposit Advances; (iii) All products and proceeds of any
item described in subsections (i) and (ii) of this definition.
	 
	 	 	CONSOLIDATED COMPANIES — At any date of determination thereof, Borrower
and all of its Subsidiaries.
	 
	 	 	CONSOLIDATED NET WORTH — For any period, the consolidated stockholders’
equity in Borrower and its Subsidiaries, as determined in accordance with
GAAP.
	 
	 	 	CONTROL AGREEMENT — A Control Agreement by and among Borrower, Lender and
FNCM regarding the FNCM Account, securing repayment of a Deposit Advance,
substantively similar to Exhibit “B” attached hereto and by this
reference incorporated herein.
	 
	 	 	DEBT — Without duplication, for any Consolidated Company, the sum of each
of the following: (a) all liabilities, obligations, and indebtedness of
such Person that in accordance with GAAP should be classified upon such
Consolidated Company’s balance sheet as liabilities in respect of (i)
money borrowed, including, without limitation, all Advances (ii)
obligations of such Consolidated Company under Capital Leases, and (iii)
obligations of such Consolidated Company issued or assumed as the
deferred purchase price for any Property, and all conditional sale
obligations; (b) all obligations of the type referred to in the preceding
clauses (a) (i) through (a) (iii) of other Persons, provided that a
Consolidated Company is responsible for payment or liable as an obligor,
guarantor, or otherwise; (c) all obligations of the type referred to in
the preceding clauses (a) (i) through (a) (iii) and (b) of other Persons
secured by any lien on any Property or asset of a Consolidated Company,
the amount of such obligation being deemed to be the lesser of the value
of such Property or assets or the amount of the obligation so secured;
and (d) the face amount of all letters of credit issued for the account
of a Consolidated Company, and without duplication, all drafts drawn and
unpaid thereunder.
	 
	 	 	DEBTOR RELIEF LAWS — The Bankruptcy Code of the United States of America
and all other applicable liquidation, conservatorship, bankruptcy,
moratorium, rearrangement, receivership, insolvency, reorganization,
fraudulent transfer or conveyance, suspension of payments or similar Laws
from time to time affecting the rights and remedies of Creditors.
	 
	 	 	DEFAULT RATE — The interest rate permitted to be assessed by Lender
pursuant to any Note upon the occurrence of an Event of Default.
	 
	 	 	DEPOSIT ADVANCE — A loan of funds by Lender to Borrower or a Subsidiary
to be utilized by Borrower or such Subsidiary as an Earnest Deposit or
Permanent Mortgage Deposit.

2

 

	 	 	EARNEST DEPOSIT — Funds delivered by Borrower or a Subsidiary in
conjunction with the execution of a purchase agreement to acquire a
Property, provided, that such purchase agreement shall provide that said
funds shall constitute payment of a portion of the purchase price for
such Property in the event that such purchase is consummated.
	 
	 	 	ERISA — The Employment Retirement Income Security Act of 1974, as
amended, and any regulations and rulings promulgated thereunder.
	 
	 	 	EVENT OF DEFAULT — Any of the events described in Section 8 hereof.
	 
	 	 	ENVIRONMENTAL INDEMNITY AGREEMENT — An Environmental Indemnity Agreement
from Borrower or a Subsidiary to Lender, substantively similar to Exhibit
“C” attached hereto and by this reference incorporated herein.
	 
	 	 	FACILITY — The credit facility described in and subject to the
limitations of this Agreement.
	 
	 	 	FINANCIAL STATEMENTS — Balance sheets, statements of operations,
statements of shareholders’ investments, and statements of cash flows
prepared in accordance with GAAP, which statements of operations and
statements of cash flows shall be in comparative form to the
corresponding period of the preceding fiscal year, and which balance
sheets and statements of shareholders’ investments shall be in
comparative form to the prior fiscal year-end figures.
	 
	 	 	GAAP — Generally accepted accounting principles.
	 
	 	 	GUARANTY — In the instance in which a Debt is incurred by a Subsidiary
pursuant to this Agreement, an agreement whereby Borrower guarantees
payment and performance of each and every duty and obligation imposed
upon such Subsidiary by each and every Loan Document executed by such
Subsidiary relative to such Debt. Such Guaranty shall be substantively
similar to Exhibit “D” attached hereto and by this reference incorporated
herein.
	 
	 	 	LAWS — All applicable statutes, laws, treaties, ordinances, rules,
regulations, orders, writs, injunctions, decrees, judgments, opinions, or
interpretations of any governmental authority.
	 
	 	 	LIEN — Any lien, mortgage, security interest, pledge, assignment, charge,
title retention agreement, or encumbrance of any kind, and any other
arrangement with any creditor to have its claim satisfied out of any
property or assets, or the proceeds therefrom, prior to the general
creditors of the owner thereof.
	 
	 	 	LOAN DOCUMENTS — Any and all documents executed by Borrower or a
Subsidiary in connection with the making of an Advance by Lender to
Borrower or a Subsidiary pursuant to this Agreement.
	 
	 	 	MATERIAL ADVERSE EVENT — Any circumstance or event which, individually or
collectively, could reasonably be expected to result in any (a) material
impairment of the ability of Borrower or any Subsidiary to perform any of
its payment or other material obligations under any Loan Document or the
ability of Lender to enforce any such obligations or any of its rights
and remedies under the Loan Documents, or (b) material and adverse effect
on the business, properties, condition or results of operations of

3

 

	 	 	Borrower or any Subsidiary. The phrase “could be a Material Adverse
Event” (or any similar phrase herein) means that there is a material
probability of such Material Adverse Event occurring, and the phrase
“could not be a Material Adverse Event” (or any similar phrase herein)
means that there is a not a material probability of such Material Adverse
Event occurring.
	 
	 	 	MINIMUM DEBT SERVICE COVERAGE RATIO (ACQUISITION ADVANCE)  — The quotient
of a fraction, the numerator of which fraction is the annual net
operating income and the denominator of which fraction is the actual
annual debt service, premised upon an interest rate that is the greater
of (i) the Prime Rate or (ii) 175 basis points above the then prevailing
rate on securities issued by the United States of America, the term of
which securities shall be ten (10) years from the date on which the Debt
Service Coverage Ratio is determined. For purposes of calculating the
Debt Service Coverage Ratio, the annual debt service shall be premised
upon the lesser of (i) a 25-year amortization or (ii) the length of time
determined by Lender, in its reasonable business judgment, after
reviewing the terms of the Property Lease relating to the Property for
which the Debt Service Coverage Ratio is being calculated. For purposes
of this definition, the annual net operating income shall consist of all
rental income payable pursuant to the Property Lease relating to a
Property, as determined on an annual basis, less those operating expenses
required to be paid by the lessor pursuant to such Property Lease for the
same annual term.
	 
	 	 	MINIMUM TANGIBLE NET WORTH — For purposes of this Agreement, the
definition of Minimum Tangible Net Worth shall include subordinated debt.
Minimum Tangible Net Worth means, at any time, stockholders’ equity (the
par value of outstanding capital stock, plus capital surplus, plus
retained earnings), less the sum of:

	 	a.	 	Any surplus resulting from any write up of assets
subsequent to December 31, 2003;
	 
	 	b.	 	Goodwill, including any amounts, however designated on
the consolidated Financial Statements of the Consolidated
Companies, representing the excess of the purchase price paid for
assets or stock acquired over the value assigned thereto on the
books of any Consolidated Company;
	 
	 	c.	 	Any amount reflecting value of patents, trademarks,
trade names and copyrights;
	 
	 	d.	 	Any amount at which shares of capital stock of any
Consolidated Company appear as an asset on the consolidated
Financial Statements;
	 
	 	e.	 	Loans and advances to stockholders, directors, officers
or employees of any Consolidated Company;
	 
	 	f.	 	Deferred expenses; and
	 
	 	g.	 	any other amount in respect of an intangible that
should be classified as an asset on a balance sheet of any
Consolidated Company in accordance with GAAP.

	 	 	NOTE — A Promissory Note from Borrower or a Subsidiary to Lender,
evidencing an Advance, substantively similar to Exhibit “E” attached
hereto.

4

 

	 	 	OBLIGATION — All present and future indebtedness, liabilities, and
obligations, and all renewals and extensions thereof, or any part
thereof, now or hereafter owing to Lender by Borrower or any Subsidiary
arising from, by virtue of, or pursuant to this Agreement or any Loan
Document, together with all interest accruing thereon, fees, costs, and
expenses (including, without limitation, all reasonable attorneys’ fees
and expenses incurred in the enforcement or collection thereof) payable
pursuant to this Agreement or any Loan Document.

	 	 	PARTICIPANT — A Person as defined in Section 10.12 hereof.
	 
	 	 	PERMANENT MORTGAGE DEPOSIT — Funds delivered by Borrower or a Subsidiary
in conjunction with the submission of an application, good faith deposit,
interest rate lock deposit, forward commitment deposit, closing expense
deposit, or other similar deposit relating to permanent mortgage
financing for a Property.
	 
	 	 	PERMITTED INVESTMENTS — Certificates of deposit at Lender, and/or debt
instruments backed by the United States Government (such as treasury
bills or agency bonds).
	 
	 	 	PERSON — Corporations, general partnerships, limited partnerships,
limited liability companies, limited liability partnerships, natural
persons, joint ventures, associations, or other organizations, whether or
not legal entities.
	 
	 	 	PLAN — All pension, savings, retirement, health, insurance, severance and
other employee benefit or fringe benefit plans, programs, arrangements or
agreements (including “employee benefit plans” as defined by ERISA)
maintained or sponsored by Borrower or any Subsidiary or with respect to
which Borrower or any Subsidiary has any responsibility, obligation or
liability, contingent or otherwise.
	 
	 	 	POTENTIAL DEFAULT — The occurrence of any event or existence of any
circumstance that, with the giving of notice or lapse of time, or both,
would constitute an Event of Default.
	 
	 	 	PRIME RATE —  That rate of interest quoted in the Money Rates column of
The Wall Street Journal as the “Prime Rate.” In the event that The Wall
Street Journal abolishes or abandons the practice of publishing the
“Prime Rate,” then the “Prime Rate” used shall be that interest rate or
general reference rate that Lender, in its reasonable judgment,
determines most effectively approximates the “Prime Rate”, as previously
quoted in The Wall Street Journal.
	 
	 	 	PROPERTY — A parcel of real property acquired by Borrower or any
Subsidiary, provided, that Lender provided or is providing an Advance
with respect to such parcel of real property.
	 
	 	 	PROPERTY LEASE — A lease relating to a Property, wherein Borrower or a
Subsidiary is the lessor.
	 
	 	 	REQUEST FOR ADVANCE — A written request that Lender grant an Advance to
Borrower or a Subsidiary, substantively similar to Exhibit “F” (2
Versions) attached hereto and by this reference made a part hereof.

5

 

	 	 	SECURITY AGREEMENTS — A security agreement of Borrower or a
Subsidiary,securing repayment of an Advance, substantively similar to
Exhibit “G” attached hereto and by this reference made a part hereof.
	 
	 	 	SECURITY INSTRUMENT — A deed of trust, security agreement and assignment
of rents, mortgage, or similar document, substantively similar to Exhibit
“H” attached hereto and by this reference incorporated herein pursuant to
which Lender is granted a lien upon a parcel of Property.
	 
	 	 	SOLVENT — As to any Person, that (a) the aggregate fair market value of
such Person’s, assets exceeds its liabilities (whether such liabilities
are contingent, subordinated, unmatured, unliquidated, or otherwise), (b)
such Person has sufficient cash flow to enable it to pay its Debts as
they mature, and (c) such Person has sufficient capital to conduct such
Person’s business.
	 
	 	 	SUBSIDIARY — With respect to Borrower, an entity of which an aggregate of
more than 50% (in number of votes) of the stock (or equivalent interests)
is owned of record or beneficially, directly or directly, by Borrower.
	 
	 	 	TAXES — For any person, taxes, assessments, or other governmental charges
or levies imposed upon such Person, its income, or any its properties,
franchises or assets.
	 
	 	 	TERMINATION DATE — Three Hundred Sixty-Four (364) days from and after the
date of execution of this Agreement.
	 
	 	 	TOTAL LIABILITIES TO TANGIBLE NET WORTH — The quotient of a fraction, the
numerator of which fraction is the total of all Debt of Borrower and its
Subsidiaries, and the denominator of which fraction is Consolidated Net
Worth.
	 
	 	 	TYPE — An Acquisition Advance or a Deposit Advance.

SECTION 2. REVOLVING FACILITY

     2.1 ADVANCES.

     Lender agrees that it will, subject to the terms and provisions of this
Agreement, make Advances to Borrower and its Subsidiaries from time to time
during the term commencing on the date hereof to and including the Business Day
immediately preceding the Termination Date in an aggregate principal amount not
exceeding the sum of $50,000,000.00, provided, that the aggregate indebtedness
due and owing pursuant to all of the Advances and all of the Notes evidencing
such Advances shall not, at any time during the term of this Agreement, exceed
the sum of $50,000,000.00. Borrower and its Subsidiaries may, subject to the
limitations set forth above, borrow, repay and reborrow under this Facility.

6

 

     Each Advance made by the Lender to Borrower or a Subsidiary shall be
further evidenced by a Note executed by Borrower or the respective Subsidiary
contemporaneously with each Advance, payable to the order of the Lender, in the
principal amount of the Advance it evidences. Each Note shall be dated as of
the date of the Advance it evidences.

     Records maintained by Lender shall be conclusive evidence, absent manifest
error, of the amount of the Advances made by Lender to Borrower and each
Subsidiary, and the interest and principal payments thereon. Any failure to so
record, or any error in recordation, shall not, however, limit or otherwise
affect the obligation of Borrower or the respective Subsidiary under the Loan
Documents to pay any amount owing pursuant to the respective Obligation.

     All payments of principal, interest, and other amounts required to be paid
by Borrower or a Subsidiary pursuant to this Facility shall be paid to Lender
at its principal office in Omaha, Nebraska in funds which are or will be
available for immediate use by Lender by 12:00 Noon, Omaha, Nebraska time on
the date on which the same are due, without setoff, deduction, or counterclaim.
If any payment required to be paid pursuant to this Facility shall be due on a
day that is not a Business Day, such payment may be made on the next succeeding
Business Day, and such extension of time shall be included in the computation
of interest and fees, as applicable. Payments made after 12:00 Noon, Omaha,
Nebraska time shall be deemed made on the next Business Day.

     2.2 INTEREST AND PRINCIPAL PAYMENTS.

     Except as otherwise provided herein, interest on all Advances shall accrue
at the Prime Rate, provided, that said interest rate shall not, in any event,
be reduced to an interest rate that is less than 4.0% per annum. The interest
rate shall be adjusted daily.

     Interest accrued on each Advance shall be paid to Lender in arrears on the
first Business Day of the month immediately succeeding the month during which
any Advance is made by Lender and on the first day of each and every month
thereafter until such Advance is paid in full.

7

 

     Deposit Advances shall be paid in full on the date of closing of the
acquisition of the respective Property or on the date of closing of permanent
financing for a Property, as applicable.

     With respect to Notes evidencing Deposit Advances that are not paid in
full prior to the Termination Date, in the event that Borrower has not replaced
this Facility with a facility provided by a different lender, or in the event
that Lender has not renewed this Facility, Lender will extend the term of the
Note evidencing such Deposit Advance for an additional term, provided, that
such additional term shall, in any and all events, mature not later than six
(6) months subsequent the Termination Date.

     Acquisition Advances shall be paid in full upon the earlier to occur of
(i) closing of the permanent financing for the respective Property, or (ii) six
(6) months from the date on which such Acquisition Advance is made by Lender,
provided, in the event that said 6-month term expires subsequent to the
Termination Date , the maturity date of such Note shall be that date which is
six (6) months subsequent to the date of execution of such Note.

     With respect to Notes evidencing Acquisition Advances that mature
subsequent to the Termination Date, in the event that Borrower has not replaced
this Facility with a facility provided by a different lender, or in the event
that Lender has not renewed this Facility, Lender will extend the term of the
Note evidencing such Acquisition Advance for an additional term not exceeding
364 calendar days from the initial maturity date for such Acquisition Advance
(i) at an interest rate not exceeding one percent (1.0%) greater than the Prime
Rate, (ii) for a term not exceeding 364 calendar days from the initial maturity
date of the Note executed in conjunction with such Acquisition Advance, and
(iii) requiring payment of principal and interest installments amortized over a
term equal to the remaining term of the Property Lease pertaining to the
Property with respect to which such Acquisition Advance was granted, provided,
in the event that such Property Lease includes a provision that permits
termination of such Property Lease on a date (“Early Termination Date”) that
precedes the scheduled maturity date of such Property Lease,

8

 

such amortization term shall be reduced to a date that is coterminous with
the Early Termination Date.

     Borrower or a Subsidiary may prepay all or any part of any Advance at any
time upon ten (10) Business Days’ prior written notice to Lender. Each such
notice shall specify the prepayment date and the Advance being prepaid.

     2.3 DEFAULT RATE.

     In the event that any installment is not paid within ten (10) days from
the date on which the same is due and payable, interest shall accrue on the
principal amount of the Note evidencing the respective Advance from the date on
which such installment was due and payable at a rate of interest that is four
percent (4.0%) greater than the Prime Rate (“Default Rate”) until paid.

     2.4 LATE FEE.

     In the event that any installment is not paid within ten (10) days from
the date on which such installment is due and payable pursuant to the
respective Note, Lender may, at its option, assess a late fee in an amount
equal to five percent (5.0%) of the amount of such installment. Such late fee
shall be paid contemporaneously with the payment of the accrued installment,
and in the event that such late fee is not paid contemporaneously with payment
of the accrued installment, interest shall accrue on the late fee at the
Default Rate.

     Imposition of a late fee shall not preclude Lender from assessing interest
at the Default Rate as set forth in Section 2.3 hereof.

     2.5 INTEREST CALCULATIONS.

     All payments of interest shall be calculated on the basis of the actual
number of days elapsed (including the first day but excluding the last day)
computed on the basis of a calendar year consisting of 360 days. All interest
rate determinations and calculations by Lender shall be conclusive and binding
absent manifest error.

9

 

     2.6 MAXIMUM RATE; USURY.

     All agreements between Lender and Borrower, whether now existing or
hereafter arising and whether written or oral, are expressly limited so that
in no contingency or event whatsoever, whether by reason of advancement of the
proceeds hereof, acceleration of maturity of the unpaid principal balance
hereof, or otherwise, shall the amount paid or agreed to be paid to Lender for
the use, forbearance or detention of the money to be advanced hereunder exceed
the highest lawful rate permissible under applicable usury laws. If, from any
circumstance whatsoever, fulfillment of any provision hereof, or in the
Security Instrument securing any Note, or any other agreement referred to
herein, at the time performance of such provision shall be due, shall involve
transcending the limit of validity prescribed by law which a court of competent
jurisdiction may deem applicable hereto, then, ipso facto, the obligation to be
fulfilled shall be reduced to the limit of such validity, and if from any
circumstance the holder hereof shall ever receive as interest an amount which
would exceed the highest lawful rate, such amount that would be excessive
interest shall be applied to the reduction of the unpaid principal balance due
hereunder and not to the payment of interest, or if such excessive amount
exceeds the unpaid principal balance, such excess shall be refunded to
Borrower. All interest paid, or agreed to be paid to Lender, to the extent
permitted by applicable law, shall be amortized, prorated, allocated and spread
throughout the full period until payment in full of principal and interest of
this Facility, including any period of extension or renewal, so that the
interest for such full period shall not exceed the maximum amount permitted by
applicable Law. This provision shall control every other provision of all
agreements between Lender and Borrower.

     2.7
ORDER OF APPLICATION.

     Payments and prepayments of any Note shall be applied in the following order:

     (i) to the payment of all fees and reasonable expenses for which
Lender has not been paid or reimbursed as required by the Loan Documents;

     (ii) accrued and unpaid late charges;

     (iii) accrued and unpaid interest calculated at the Default Rate;

10

 

     (iv) accrued and unpaid interest calculated at Prime Rate; and

     (v) to the payment of the principal indebtedness due and owing
pursuant to any Note in such order as Lender may elect.

     2.8 OFFSET.

     Upon the occurrence and during the continuance of an Event of Default,
Lender shall be entitled to exercise its right of offset against (i) each and
every account and other property, or any interest therein, that Borrower may
now or hereafter have with, or that is now or hereafter in the possession of,
Lender, and (ii) the FNCM Account, to the extent of the full amount of all
Advances owed to Lender.

     2.9 TAXES.

     Any and all payments by Borrower or any Subsidiary to or for the account
of Lender hereunder or under any other Loan Document shall be free and clear of
and without deduction for any and all present or future Taxes or fees,
excluding Taxes imposed on income payable to Lender. If Borrower or any
Subsidiary shall be required by Law to deduct any Taxes from or in respect of
any sum payable under this Facility, (i) the sum payable by Borrower or such
Subsidiary shall be increased as necessary so that after making all required
deductions, Lender receives an amount equal to the sum that it would have
received had no such deductions been made, (ii) Borrower or the respective
Subsidiary shall make such deductions, (iii) Borrower or such Subsidiary shall
pay the full amount deducted to the relevant taxation authority or other
authority in accordance with applicable Law, and (iv) Borrower or such
Subsidiary shall furnish to Lender the original or a certified copy of a
receipt evidencing payment thereof.

     Borrower agrees to indemnify Lender for the full amount of any Taxes that
should have been withheld by Borrower or any Subsidiary and any other Taxes
paid by Lender and any liability (including penalties, interest, and expenses
other than those incurred as a result of the gross negligence or willful
conduct of Lender) arising therefrom or with respect thereto.

11

 

     The agreements and obligations of Borrower contained in this Section 2.9
shall survive the termination of this Facility and the payment in full of all
Obligations hereunder.

SECTION 3. BORROWING PROCEDURE.

     The following procedures apply to Advances made by Lender pursuant to this Facility:

     3.1 DEPOSIT ADVANCES

     Each Deposit Advance shall be made by Lender upon receipt of a Request for
Advance, which Request for Advance (i) shall be binding on Borrower, (ii) shall
specify the Borrowing Date, amount, Type, and designate whether such Deposit
Advance is an Earnest Deposit or a Permanent Mortgage Deposit, and (iii) must
be received by Lender not later than 10:00 A.M., Omaha, Nebraska time on the
third Business Day preceding the Borrowing Date for such Deposit Advance.

     Each Deposit Advance shall be secured by a duly perfected first priority
security interest in the FNCM Account, and Borrower shall execute and deliver
to Lender, contemporaneously with the submission of the Request for Advance, a
Control Agreement granting to Lender a security interest in the FNCM Account in
an amount equal to the amount designated in the Request for Advance, provided,
in the event that the investments in the FNCM Account are not cash deposits,
Borrower shall, if requested by Lender, grant to Lender a security interest in
such investments in an amount equal to 110% of the amount of the Advance
requested by Borrower. In the event that the fair market value of the
investments in the FNCM Account is less than the amount designated in the
Request for Advance (or an amount equal to 110% of the amount requested in the
event that the investments in the FNCM Account are not cash investments),
Lender shall not be obligated to fund the Deposit Advance described in the
Request for Advance.

     3.2 CONDITIONS PRECEDENT TO DEPOSIT ADVANCES.

     The obligation of Lender to make a Deposit Advance is subject to each of
the following conditions precedent:

12

 

     On or before the Borrowing Date for such Deposit Advance, all of the
following, in form and substance satisfactory to Lender, shall be delivered by
Borrower or the respective Subsidiary to Lender:

     (a) Promissory Note in the principal amount of the Deposit Advance;

     (b) A Guaranty (in the instance that such Deposit Advance is granted to a
Subsidiary of Borrower);

     (c) In the instance of a Permanent Mortgage Deposit, an executed
commitment letter, term sheet, and other related documents executed by the
proposed mortgagee;

     (d) In the instance of an Earnest Deposit, a copy of the executed purchase
agreement, or in the event that a purchase agreement has not been executed, the
most current draft version of such purchase agreement (in the event that a
purchase agreement has not been executed, Borrower shall provide to Lender
copies of any executed memoranda, such as letters of intent, relating to the
proposed purchase, and at such time as a purchase agreement is executed,
Borrower will provide to Lender a copy of the executed purchase agreement);

     (e) An executed Security Agreement;

     (f) An executed Control Agreement; and

     (g) Such other and further documentation as Lender may reasonably require.

     3.3 ACQUISITION ADVANCES

     Each Acquisition Advance shall be made by Lender upon receipt of
Borrower’s Request for Advance requesting that Lender fund an Acquisition
Advance on a Borrowing Date, which Request for Advance (i) shall be binding on
Borrower, (ii) shall specify the Borrowing Date, amount, and Type, and (iii)
must be received by Lender not later than 10:00 A.M., Omaha, Nebraska time on
the tenth Business Day preceding the Borrowing Date for any Acquisition
Advance.

     The obligation of the Lender to make an Acquisition Advance is subject to
each of the following conditions precedent:

13

 

     (A) A Minimum Debt Service Coverage Ratio (Acquisition Advance) not less
than 1.20 with respect to the Property for which such Acquisition Advance is
requested;

     (B) The amount of each Acquisition Advance shall not exceed an amount
equal to 70% of the lesser of (i) the appraised value of the Property which is
the subject of such Acquisition Advance, as determined by an MAI appraisal or
(ii) the purchase price for such Property; and

     (C) Not less than five days prior to closing on an Acquisition Advance,
Borrower or the respective Subsidiary shall provide to Lender, in form and
content satisfactory to Lender, each of the following:

	 	(a)	 	TITLE INSURANCE. A commitment to issue, on the closing date,
an ALTA mortgagee’s policy of title insurance to Lender, American
Land Title Association Loan Policy (Form 10/17/92) or such other
form as Lender shall approve, for the full amount funded for each
Property acquired under this Facility. The title insurance policy,
when issued, shall contain a comprehensive zoning endorsement and
any and all other endorsements that Lender shall require. Title to
each Property shall be subject only to those exceptions as Lender
shall approve.
	 
	 	(b)	 	ALTA AS-BUILT SURVEY of the Property to be mortgaged,
identifying all easements and utility locations, by a land surveyor
duly registered and in good standing in the state where the property
is being acquired, to be in accordance with Lender’s survey
requirements, as listed in Exhibit “I” attached hereto.
	 
	 	 	 	     Such survey shall also evidence that ingress and egress to the
Property is by public streets and that all utilities serving the
Property are located in the public right-of-way abutting the
Property, or in the event that such utilities are connected to the
Property by passage over or through other property that is not
public right-of-way, that easements, acceptable to Lender, have
been granted for service by

14

 

	 	 	 	such utilities, and such easements shall be included as insured
parcels in the above-referenced title insurance.
	 
	 	(c)	 	APPRAISAL: An MAI Appraisal Report on each Property to be
funded, to be ordered by the Lender at Borrower’s cost. The
appraisal report must be in compliance with all of the minimum
standards as required by FIRREA in its uniform appraisal standards
adopted June 7, 1994, dealing with federally regulated institutions.
Said appraisal shall be addressed to Lender and shall provide that
Lender may rely upon such appraisal.
	 
	 	(d)	 	PHASE I ENVIRONMENTAL REPORT: A satisfactory Phase I
Environmental Site Assessment Report covering each Property that
will include, as a minimum, a 40 year title search of all past users
and owners of the subject Property being mortgaged. Said Phase I
Environmental Site Assessment Report shall be addressed to Lender
and Borrower or the respective Subsidiary and shall provide that
Lender may rely upon such report and will have a direct cause of
action against the Person issuing such report in the event that such
report is erroneous in any respect or fails to include any statement
or fact that renders such report inaccurate or misleading. In the
event that such report is not addressed to Lender, the Person
issuing such report shall provide to Lender a letter acknowledging
that Lender may rely upon such report and that such report was
issued for the benefit of Lender and Borrower.
	 
	 	(e)	 	INSURANCE: Fire and extended coverage insurance for the full
insurable value of each Property, together with comprehensive
general liability insurance and loss of rental income for each
Property for a period of twelve (12) months. Such insurance
coverage shall specifically include coverage for any acts of
terrorism. All insurance policies required hereunder shall be
issued by companies, on forms, in amounts and with deductibles
acceptable to Lender, and shall designate

15

 

	 	 	 	Lender as “additional insured” and “loss payee” with a standard
noncontributory mortgagee clause in favor of Lender.
	 
	 	 	 	     Each such insurance policy shall provide that there shall be
no cancellation or modification with less than thirty (30) days’
prior written notice to Lender. All such policies covering
Properties shall be renewed during the term of this Facility and
copies of same shall be provided to Lender at least thirty (30)
days prior to the termination date of any then current policy.
	 
	 	(f)	 	TAXES AND ASSESSMENTS: Evidence that all installments of
general real estate taxes, special taxes or assessments and other
impositions are paid.
	 
	 	(g)	 	LEGAL COMPLIANCE: Evidence from local governmental
authorities having jurisdiction that the Property complies with all
zoning requirements, fire marshal requirements, city code
requirements, and any other local ordinance relative to the
Property’s development.
	 
	 	(h)	 	FINANCIAL STATEMENTS: Borrower shall provide to Lender, upon
Lender’s request, rent rolls and operating and financial statements
regarding each Property acquired with funds provided pursuant to
this Facility.
	 
	 	(i)	 	U.C.C./TAX LIEN/JUDGMENT SEARCHES: U.C.C., tax lien and
judgment searches against such parties as Lender may require,
confirming that the personal property located at the Property and
owned by the Borrower or Subsidiary, as applicable, and the
Property, are free from all security interests, Liens, judgments and
encumbrances, except the prior security interest to Lender, such
searches to be updated as of the closing date of each Property
acquired and mortgaged.
	 
	 	(j)	 	LEGAL CAPACITY: In the event that Borrower proposes that a
Subsidiary of Borrower shall acquire a Property, Borrower or such
Subsidiary shall provide to Lender evidence that such Subsidiary is
in good standing in the state in which

16

 

	 	 	 	such Subsidiary is organized, such organizational documentation as
Lender may request, and such authorization documentation as Lender
may require.
	 
	 	(k)	 	GUARANTY: In the event that Borrower proposes that a
Subsidiary shall acquire a Property, Borrower shall execute and
deliver to Lender a Guaranty whereby Borrower shall guarantee
payment and performance of any and all Obligations imposed upon such
Subsidiary by the Loan Documents executed by such Subsidiary for the
benefit of Lender in conjunction with such acquisition.
	 
	 	(l)	 	PROPERTY CONDITION REPORT: A report, prepared by a Person
acceptable to Lender, describing and assessing the condition of such
facets of the Property as may be requested by Lender.
	 
	 	(m)	 	PROPERTY LEASES: Borrower shall provide to Lender a copy of
each Property Lease regarding the Property. In the event that the
terms, conditions, and provisions of all Property Leases relating to
a Property are not acceptable to Lender, as determined in Lender’s
sole and absolute discretion, Lender shall not have any duty or
obligation to make an Acquisition Advance with respect to such
Property.
	 
	 	(n)	 	USE OF PROPERTY: In the event that the use(s) of the
Property, as determined by the Property Leases regarding such
Property, is/are not acceptable to Lender, as determined in Lender’s
reasonable discretion, Lender shall not have any duty or obligation
to make an Acquisition Advance with respect to such Property.
Lender agrees that any Property that is required to be utilized for
offices by any entity described in Section 6.1 shall constitute a
use that is acceptable to Lender.

     3.4 CONDITIONS PRECEDENT TO ACQUISITION ADVANCES.

     On or before the Borrowing Date for such Acquisition Advance, all of the
following, in form and substance satisfactory to Lender, shall be delivered by
Borrower or the respective Subsidiary to Lender:

17

 

	 	(a)	 	Promissory Note in the principal amount of the Acquisition Advance;
	 
	 	(b)	 	A Guaranty (in the instance of an acquisition by a Subsidiary of
Borrower);
	 
	 	(c)	 	With respect to each Property for which an Acquisition Advance is
requested:

	 	1.	 	An Assignment of Rents and Leases;
	 
	 	2.	 	A first priority Security Instrument;
	 
	 	3.	 	An Environmental Indemnity Agreement;
	 
	 	  4.  A UCC Financing Statement covering tangible and intangible assets
owned by the Borrower or Subsidiary, as applicable, and located at the
Property;
	 
	 	5.	 	Rent roll and copies of all Property Lease(s) regarding such
Property;
	 
	 	6.	 	Subordination, Non-Disturbance and Attornment Agreements executed
by the lessees of such Property;
	 
	 	7.	 	Estoppel certificates executed by each of the lessees occupying
such Property;
	 
	 	8.	 	A Notice of Commencement or equivalent notice (if applicable);
	 
	 	9.	 	An Assignment of Contracts (Construction) (if applicable); and
	 
	 	10.	 	An Assignment of Architect’s Contract, Plans and Specifications
(if applicable).

	 	(d)	 	Such other and further documentation as Lender may reasonably
require.

     3.5 EXPENSES.

Borrower shall be liable for any and all fees and expenses related to the
provision of any report, survey, appraiser, title insurance or any other matter
required to be provided by any Consolidated Company in conjunction with any
Advance, and Borrower shall reimburse Lender for any and all expenses, but not
limited to, reasonable attorney fees incurred by Lender in connection with the
making of any Advance by Lender to any Consolidated Company.

18

 

SECTION 4. FEES.

     4.1 TREATMENT OF FEES.

The fees described in this Section 4 (a) do not constitute compensation for the
use, detention or forbearance of money, (b) are in addition to, and not in lieu
of, interest and expenses otherwise described in this Facility, (c) shall be
payable as provided herein, (d) shall be nonrefundable, and (e) shall, to the
fullest extent permitted by Law, bear interest, if not paid when due, at the
Default Rate.

     4.2 ORIGINATION FEE.

     Borrower shall pay to Lender an origination fee in the amount of
$250,000.00 contemporaneously with the execution of this Agreement. Said fee
shall be fully earned by Lender upon execution of this Agreement, and no
portion of said fee shall, in any event, be refunded to Borrower.

     4.3 ADVANCE FEES.

     Borrower shall, contemporaneously with the making of an Advance by Lender
hereunder, pay to Lender a fee in an amount equal to 0.50% of such Advance
(“Advance Fee”).

     4.4 PAYMENT OF FEES. Said origination fee and all Advance Fees shall
constitute additional Obligations due and owing hereunder and shall bear
interest at the Default Rate from the date on which the same are due and
payable until date of payment by Borrower or the respective Subsidiary. In the
event that any such fee is not paid within ten (10) Business Days after the
date on which the same was due and payable, Borrower hereby authorizes Lender
to advance such sum(s) to itself from the FNCM Account. In the event that the
balance in the FNCM Account, after deduction of amounts in the FNCM Account
that are subject to Control Agreements, is insufficient to pay such fees, the
failure to pay any such fees shall constitute an Event of Default hereunder.

19

 

SECTION 5. CONDITIONS PRECEDENT

     5.1 CONDITIONS PRECEDENT TO CLOSING.

     This Facility shall not become effective unless and until (a) Lender has
received all of the agreements, documents, instruments, and other items
described in Schedule 5.1, (b) there has been no material adverse change in the
consolidated financial condition of the Consolidated Companies from that shown
in the respective Financial Statements of the Consolidated Companies dated
December 31, 2003, and (c) Borrower has provided to Lender evidence
satisfactory to Lender that Borrower has filed an election with the Internal
Revenue Service to be taxed as a real estate investment trust (“REIT”) pursuant
to the Code.

     Borrower shall deliver to Lender, simultaneously with the delivery of this
Agreement to Lender, the resolutions of Borrower’s board of directors approving
this Agreement and specifying the person or persons authorized to execute the
same and the other Loan Documents from time to time.

     5.2 CONDITIONS PRECEDENT TO ALL ADVANCES.

     In addition to the conditions stated in Section 5.1, (except Section 5.1
(c)), the obligation of Lender to make each Advance (including the initial
Advance) is subject to the further conditions precedent that on the date of the
Advance the following statements shall be true:

	 	(a)	 	Lender has received a Request for Advance;
	 
	 	(b)	 	Lender has received the Advance Fee as required
by Section 4.3 hereof;
	 
	 	(c)	 	The representations and warranties contained in
Section 6 hereof are true and accurate on and as of the date
of such Advance as though made on and as of such date (except
to the extent that such representations and warranties relate
solely to an earlier date);
	 
	 	(d)	 	No Event of Default or Potential Default has
occurred and is continuing;
	 
	 	(e)	 	The Aggregate Minimum Debt Service Coverage Ratio
with respect to all Properties owned by all Consolidated
Companies is not less than 1.20;

20

 

	 	(f)	 	The Minimum Tangible Net Worth of all
Consolidated Companies is not less than $90,000,000.00;
	 
	 	(g)	 	The Consolidated Companies have a Total
Liabilities to Tangible Net Worth ratio not greater than 4.0;
	 
	 	(h)	 	The funding for such Advance is permitted by Law;
and
	 
	 	(i)	 	All matters related to the requested Advance must
be satisfactory to Lender and its counsel in their reasonable
business judgment.

     Each Request for Advance delivered to Lender shall constitute a
ratification, confirmation and affirmation of each and every representation,
warranty, covenant and agreement of Borrower to Lender herein, effective as of
the date of such Advance. Time is of the essence with respect to each
condition precedent set forth herein. Lender may, in its sole and absolute
discretion, fund any Advance prior to the satisfaction of all conditions
precedent, but such funding shall not constitute a waiver of the requirement
that each such condition precedent must be satisfied with respect to the
Advance that is being requested, and any funding prior to the satisfaction of
all conditions precedent shall not constitute a waiver of any requirement that
each such condition precedent shall be satisfied as a prerequisite for any
subsequent Advance unless specifically waived in writing by Lender.

SECTION 6. REPRESENTATIONS AND WARRANTIES

     Borrower hereby represents and warrants to Lender as follows:

     6.1 PURPOSE OF CREDIT FACILITY.

     Borrower and any Subsidiary will use all proceeds of any Advance solely
for the purpose of acquiring Properties or securing permanent financing for
such Properties. Each Property must be subject to a Property Lease with a
lessee which is (i) an agency of the federal government, or (ii) the federal
government, acting through the General Services Administration. Each Property
Lease shall have a remaining term not less than ten (10) years from the date on
which an Advance is made by Lender with respect to such Property. In the event
that Borrower or any

21

 

Subsidiary proposes to acquire a Property that is subject to a Property
Lease with a state government, a state governmental agency, a local government,
a local governmental agency or a federal, state or local government-sponsored
enterprise, Lender shall not have any obligation to make an Advance regarding
such Property unless Lender consents in writing to the proposed lessee of such
Property. In the event that Borrower or any Subsidiary proposes to acquire a
Property described in the preceding sentence, Lender agrees that it will
exercise reasonable business judgment in evaluating the propriety of granting
an Advance with respect to such Property.

     The proceeds of any Advance may not be utilized for any purpose except as
specifically provided herein. Borrower acknowledges and agrees that no portion
of any Advance may be utilized for the purpose of the acquiring a parcel of
real property that has not been developed, is in the process of being developed
or is not subject to a Property Lease with the federal government, as described
in the preceding paragraph. Borrower further acknowledges and agrees that
Lender shall not be required to make an Advance to any Person that is not a
Subsidiary, as defined in this Agreement.

     6.2 STATUS AS REIT.

     Borrower has qualified as a REIT under the Code.

     6.3 EXISTENCE, GOOD STANDING, AUTHORITY, AND AUTHORIZATIONS.

     Borrower is, and each Subsidiary shall be, duly organized, validly
existing, and in good standing under the Laws of its jurisdiction of
organization. Borrower represents and warrants to Lender that Borrower and
each Subsidiary (a) are duly qualified to transact business and are in good
standing in each jurisdiction where the nature and extent of their business and
properties require the same, and (b) possess all requisite authority, power,
licenses, approvals, permits, authorizations, and franchises to use their
assets and conduct their business as is now being, or is contemplated herein to
be, conducted. No filings, recordings, or registrations with, or exemptions,
orders, consents, licenses or permits from, any governmental authority are
required

22

 

to authorize, or is required in connection with, the execution, delivery,
legality, validity, binding effect, performance or enforceability of any Loan
Document, including this Agreement, except security filings to perfect Lender’s
interest as contemplated by the Loan Documents.

     6.4 AUTHORIZATION AND CONTRAVENTION.

     The execution, delivery and performance by Borrower or any Subsidiary of
any Loan Document, and its respective obligations thereunder (a) are within the
corporate powers of Borrower or the Subsidiary, (b) will have been duly
authorized by all necessary corporate action on behalf of the Borrower or such
Subsidiary when such Loan Documents are executed and delivered, (c) require no
action by or in respect of, consent of, or filing with, any governmental
authority, which action, consent, or filing has not been taken or made on or
prior to the date of execution of this Agreement, (d) will not violate any
provision of the charter or bylaws of Borrower or such Subsidiary, (e) will not
violate any provision of Law applicable to it, other than such violations that
individually or collectively would not constitute a Material Adverse Event, (f)
will not violate any written or oral agreements, contracts, commitments or
understandings to which it is a party, other than such violations that would
not constitute a Material Adverse Event, and (g) except for Liens created by
the Loan Documents, will not result in the creation or imposition of any Lien
on any asset of any Consolidated Company, except as approved by Lender in
writing.

     6.5 BINDING EFFECT.

     Upon execution and delivery by Borrower or a Subsidiary, each Loan
Document will constitute a legal, valid, and binding obligation of Borrower or
such Subsidiary, enforceable against Borrower or such Subsidiary in accordance
with its terms.

     6.6 FINANCIAL STATEMENTS. The Financial Statements were prepared in
accordance with GAAP and present fairly, in all material respects, the
consolidated financial condition, results of operations, and cash flows of the
Consolidated Companies as of and for the portion of the fiscal year endings on
the date or dates thereof. There were no material liabilities,

23

 

direct or indirect, fixed or contingent, of the Consolidated Companies as
of the date or dates of the Financial Statements which are required under GAAP
to be reflected therein or in the notes thereto, that are not so reflected.

     6.7 LITIGATION, CLAIMS, INVESTIGATIONS.

     Borrower is not subject to, or aware of the threat of, any litigation,
claims or investigations that are reasonably likely to be determined adversely
to Borrower or any Subsidiary which, if so adversely determined, could
constitute a Material Adverse Event. There are no judgments, decrees, or
orders of any governmental authority outstanding against Borrower or any
Subsidiary that could constitute a Material Adverse Event.

     6.8 TAXES.

     All tax returns of Borrower and each Subsidiary required to be filed have
been filed (or extensions have been granted) prior to delinquency, and all
Taxes imposed upon Borrower and any Subsidiary which are due and payable have
been paid prior to delinquency.

     6.9 ERISA COMPLIANCE.

     (a) No Plan has incurred an accumulated funding deficiency, as defined by
ERISA or the Code, (b) neither Borrower nor any Subsidiary has incurred any
material liability which is currently due and remains unpaid under ERISA to the
Pension Benefit Guaranty Corporation (“PBGC”) or to a Plan, (c) neither
Borrower nor any Subsidiary has engaged in any prohibited transaction as
defined by ERISA or the Code, and (d) no event has occurred which is likely to
result in the termination of a Plan.

     6.10 PROPERTIES; LIENS.

     Borrower and each Subsidiary has good and marketable title to all property
reflected on the Financial Statements, except (a) property that is obsolete,
(b) property that has been disposed of in the ordinary course of business, or
(c) as otherwise permitted by any Loan Documents.

24

 

     6.11 NO DEFAULT.

     No event has occurred and is continuing, or would result from the
incurring of Obligations by Borrower or any Subsidiary under this Facility or
any other Loan Document, which constitutes an Event of Default or a Potential
Default. No Consolidated Company is in default under or with respect to any
material written or oral agreements, contracts, commitments, or understandings
to which any such Consolidated Company is a party, which default could result
in a Material Adverse Event.

SECTION 7. COVENANTS

     From and after the date of execution of this Agreement and until all
Obligations incurred pursuant to this Agreement have been paid in full,
Borrower covenants and agrees (and agrees to cause each Subsidiary, to the
extent that any covenant is applicable to such Subsidiary) to perform, observe
and comply with each of the following covenants:

     7.1 USE OF PROCEEDS.

     Borrower and each Subsidiary shall use the proceeds of any Advances only
for the purposes stated herein.

     7.2 BOOKS AND RECORDS.

     The Consolidated Companies shall maintain books, records, and accounts
necessary to prepare financial statements in accordance with GAAP.

     7.3 ITEMS TO BE PROVIDED.

     Borrower shall cause the following to be provided to Lender:

     (a) Promptly after preparation, and not later than 120 days after the last
day of each fiscal year of Borrower, Financial Statements representing the
consolidated financial condition and results of operations calculated for the
Consolidated Companies accompanied by the unqualified opinion of a nationally
recognized independent certified public accounting firm, based upon its audit
using generally accepted auditing standards, that such Financial

25

 

Statements were prepared in accordance with GAAP and fairly present the
consolidated financial condition and results of operations of the Consolidated
Companies.

     (b) Promptly upon preparation, and in no event later than 60 days after
the last day of each fiscal quarter of Borrower (except the 4th fiscal quarter
of each fiscal year), Financial Statements representing the consolidated
financial condition and results of operations calculated for the Consolidated
Companies.

     (c) Notice, promptly after Borrower knows or has reason to know of (i) the
existence and status of any litigation which could be a Material Adverse Event,
or of any order or judgment for the payment of money which individually or
collectively exceeds $500,000.00, or any warrant of attachment, sequestration
or similar proceeding against the assets of a Consolidated Company having a
value in excess of $500,000.00; (ii) an Event of Default or Potential Default,
specifying the nature thereof and the action taken by Borrower or any other
Consolidated Company in attempting to resolve the same; (iii) receipt by any
Consolidated Company of any notice from any governmental authority of the
expiration without renewal, termination, material modification or suspension
of, or institution of any proceedings to terminate, materially modify, or
suspend, any authorization that any Consolidated Company is required to hold in
order to operate its business in compliance with all applicable laws; (iv) a
default or event of default under any material agreement of any Consolidated
Company which may constitute a Material Adverse Event; (v) the receipt by any
Consolidated Company of notice of any material violation or alleged violation
of any environmental law (as defined in Exhibit “C” attached hereto); or (vi)
the occurrence of an event that could reasonably be expected to result in
liability of a Consolidated Company to the PBGC, or the filing of or obligation
to file a notice with the PBGC, relating to the failure to make a required
installment with respect to a Plan.

     (d) Promptly after filing, a true, correct and complete copy of each
material report and registration statement filed by any Consolidated Company
with the Securities and Exchange

26

 

Commission, including, without limitation, each Form 10-K, Form 10-Q, and
Form 8-K filed by or on behalf of any Consolidated Company.

     7.4 INSPECTIONS.

     The Consolidated Companies shall permit Lender to inspect any of their
properties, to review reports, files and other records and to make and retain
copies thereof, to conduct tests or investigations, and to discuss their
affairs, conditions and finances with other creditors, directors, officers,
employees, other representatives and independent accounts of the Consolidated
Companies, as frequently as requested, at the expense of Borrower.

     7.5 TAXES.

     Each Consolidated Company shall promptly pay when due any and all Taxes
(except in those instances in which a Consolidated Company is diligently
contesting, in good faith, and with respect to which reserve or other provision
required by GAAP has been made, and with respect to which levy and execution of
any Lien securing the same have been and continue to be stayed).

     7.6 MATERIAL OBLIGATIONS.

     Each Consolidated Company shall pay all of their material obligations as
the same become due (unless such obligations, excepting Obligations arising
under the Loan Documents, are being contested in good faith by appropriate
proceedings).

     7.7 MAINTENANCE OF EXISTENCE, ASSETS AND BUSINESS.

     Each Consolidated Company shall at all times (a) maintain its existence
and good standing in the jurisdiction of its organization and its authority to
transact business in all other jurisdictions; (b) maintain all licenses,
permits and franchises necessary for its business; and (c) keep all of its
assets that are necessary to its business in good working order and condition
(ordinary wear and tear excepted) and make all necessary repairs thereto and
replacements thereof.

27

 

     Borrower will not, and Borrower will not permit any Subsidiary to, change
its name, organizational structure, state of organization, principal place of
business, chief executive office, or the location in which records regarding
any Property are maintained, without the provision of written notice to Lender,
which notice shall be delivered to Lender not less than thirty (30) days prior
to the date of such occurrence or event.

     7.8 INSURANCE.

     Each Consolidated Company shall maintain insurance with financially sound
and reputable insurers, in such amounts, and covering such risks, as shall be
ordinary and customary for similar companies in the industry.

     7.9 INVESTMENTS.

     Borrower shall direct FNCM to invest all funds delivered by Borrower to
FNCM only in Permitted Investments.

     7.10 COMPLIANCE WITH LAWS AND DOCUMENTS.

     No Consolidated Company shall violate the provisions of any Laws
applicable to it, or any material written or oral agreement, contract,
commitment, or understanding to which it is a party, if such violation alone,
or when aggregated with all other such violations, could constitute a Material
Adverse Event, and no Consolidated Company shall violate the provisions of its
charter or bylaws, or modify, repeal, replace, or amend any provision of its
charter or bylaws, if such action could adversely affect the rights of Lender.

     7.11 ASSIGNMENT.

     No Consolidated Company may, without the prior written consent of Lender,
assign or transfer any of its rights, duties, or obligations hereunder or under
any Loan Document.

     7.12 PERMITTED DISTRIBUTIONS.

     No Consolidated Company may, directly or indirectly, declare, make, or pay
any dividend or other distribution if an Event of Default or Potential Default
exists or will exist after giving effect to any such dividend or distribution.
Borrower may not directly or indirectly declare,

28

 

make, or pay any dividend or other distribution exceeding the greater of
(i) such amount as is required to be distributed as a condition to Borrower’s
continued status as a REIT (presently ninety percent (90%) of Borrower’s REIT
taxable income (as computed by Borrower for federal income tax purposes)); or
(ii) $ .25 per share, per quarter.

     7.13 MERGERS AND DISSOLUTIONS.

     No Consolidated Company will, directly or indirectly, merge or consolidate
with any other Person without the prior written consent of Lender, except
mergers or consolidations by Borrower with a Subsidiary.

     7.14 FINANCIAL COVENANTS.

     As calculated on a consolidated basis for the Consolidated Companies, the
Consolidated Companies shall (i) maintain an Aggregate Minimum Debt Service
Coverage Ratio with respect to all Properties owned by all Consolidated
Companies that is not less than 1.20, (ii) maintain a Consolidated Net Worth in
an amount not less than $90,000,000.00, and (iii) maintain a Total Liabilities
to Tangible Net Worth ratio not exceeding 4.0.

SECTION 8.DEFAULT.

     Each of the following shall constitute an Event of Default hereunder:

     8.1 PAYMENT OF OBLIGATION.

     The failure or refusal of Borrower or any Subsidiary to pay any principal
indebtedness, interest, fees, or reimbursement required by any Loan Document or
this Agreement, or any other portion of any Obligation within ten (10) calendar
days from the date on which the same is due and payable in accordance with the
terms and provisions of this Agreement or any Loan Document.

     8.2 COVENANTS.

     The failure or refusal of Borrower or any Subsidiary to punctually
perform, observe and comply with any covenant, agreement, condition, term or
provision contained in this Agreement and not otherwise specified in this
Section 8 or any other Loan Document, and such failure or

29

 

refusal shall not have been cured within thirty (30) days after written
notice from Lender of such failure or refusal; provided, in the event that such
covenant, agreement, condition, term or provision is not susceptible to cure
within thirty (30) days, that Borrower or the respective Subsidiary shall
immediately commence and diligently prosecute such action as may be required to
cure such breach or violation, provided further, that Borrower or the
respective Subsidiary shall, in any and all events, cure such breach or
violation in its entirety within ninety (90) days from the date of occurrence
of such breach or violation.

     8.3 DEBTOR RELIEF.

     Borrower or any Subsidiary (a) is not Solvent, (b) fails to pay its Debts
as the same become due and payable in accordance with the originally scheduled
payment dates for such Debts, (c) institutes, consents to, or acquiesces in any
proceeding pursuant to a Debtor Relief Law, or (d) is the subject of any
proceeding permitted or provided by any Debtor Relief Law and such proceeding
is not dismissed within ninety 90 days from the date on which such proceeding
is instituted.

     8.4 MISREPRESENTATION.

     If any representation, warranty, or statement made by Borrower or any
Subsidiary in any Loan Document, certificate or Financial Statement delivered
by Borrower or such Subsidiary shall be incorrect in any material respect, or
any material misrepresentation shall at any time be made to Lender by Borrower
or any Subsidiary, or if any Loan Document, certificate or Financial Statement
submitted by Borrower or any Subsidiary fails to include any fact that renders
such Loan Document, certificate or Financial Statement misleading in any
material respect.

     8.5 SUITS.

     If any suit or proceeding shall be filed against Borrower or any
Subsidiary which, if adversely determined, could substantially impair the
ability of Borrower or any Subsidiary to perform any of their Obligations set
forth in this Agreement or any Loan Document, as determined in the reasonable
business judgment of Lender, provided, that such suit or

30

 

proceeding is not dismissed within ninety (90) days after service of
summons upon Borrower or such Subsidiary.

     8.6 DEFAULT UNDER OTHER AGREEMENTS.

     (a) Any default exists under any agreement to which Borrower or a
Subsidiary is a party, the effect of which is to cause, or to permit any Person
to cause, an amount of Debt of Borrower or such Subsidiary in excess of
$1,000,000.00 to become due and payable by Borrower or such Subsidiary (whether
by acceleration or by its terms); or (b) any default exists under any material
written or oral agreement, contract, commitment, or understanding to which
Borrower or a Subsidiary is a party, the effect of which would be a Material
Adverse Event, unless, and as long as, such default is being contested by
Borrower or such Subsidiary in good faith by appropriate proceedings and
adequate reserves with respect thereto have been established on the books of
Borrower to the extent required by GAAP.

     8.7 EMPLOYEE BENEFIT PLANS.

     The failure of Borrower or a Subsidiary to pay any required installment or
other payment pursuant to a Plan within 30 days from the date on which such
installment or other payment is due and payable.

SECTION 9. REMEDIES UPON DEFAULT.

     9.1 EXTENSIONS OF CREDIT.

     Upon the occurrence of an Event of Default that is not cured within any
grace period, if any, afforded by this Agreement or the respective Loan
Document, or upon the occurrence of a Potential Default, the duty of Lender to
extend additional credit to Borrower or any Subsidiary pursuant to this
Agreement shall automatically terminate without provision of notice or any
other action by Lender.

     9.2 ACCELERATION.

     Upon the occurrence of an Event of Default that is not cured within any
grace period, if any, afforded by this Agreement or any Loan Document, Lender
may do any one or more of the

31

 

following: (i) accelerate the entire unpaid balance of all Obligations
due and payable by Borrower and any Subsidiary, and in such instance, all such
Obligations shall be immediately due and payable; (ii) to the extent permitted
by Law, to exercise any right of setoff or banker’s Lien, or any right as a
secured party, against the interest of Borrower and each Subsidiary in and to
every account and other property of Borrower and any Subsidiary which are in
the possession of Lender, and the FNCM Account, to the extent of the entire
amount of all Obligations; and (iii) exercise any and all other rights and
remedies available to Lender pursuant to this Agreement, any Loan Document, the
Laws of the State of Nebraska and any other applicable jurisdiction as Lender
shall deem appropriate.

     9.3 PERFORMANCE BY LENDER.

     If any duty, covenant or agreement imposed upon any Consolidated Company
by the terms and provisions of this Agreement or any Loan Document is not
performed in accordance with the terms and provisions of this Agreement or such
Loan Document, Lender may, at its option, after the occurrence and during the
continuance of an Event of Default, perform or attempt to perform such
covenant, duty, or agreement on behalf of such Consolidated Company. In such
event, any amount expended by Lender in such performance or attempted
performance shall be payable by the Consolidated Companies, jointly and
severally, to Lender upon demand, shall become part of the Obligations, and
shall bear interest at the Default Rate from and after the date of such
expenditure by Lender. This provision shall not, however, be construed to
impose any duty upon Lender to perform any such covenant, duty, or agreement,
and Lender shall not have any liability or responsibility for the performance
of any such covenant, duty, or agreement of any Consolidated Company unless
Lender, by express written consent, assumes such responsibility.

     9.4 COURSE OF DEALING.

     The acceptance by Lender, at any time, or from time to time, of partial
payment of any Obligation shall not constitute a waiver of any Event of Default
or Potential Default then existing.

32

 

A waiver by Lender of any Event of Default or Potential Default shall not
constitute a waiver of any other then existing or subsequent Event of Default
or Potential Default. No delay or omission by Lender in exercising any right
or remedy available to Lender pursuant to this Agreement or any Loan Document
shall, in any manner, affect or impair such right or remedy available to Lender
or constitute a waiver thereof or acquiescence therein, and any partial
exercise of any such right or remedy shall not preclude Lender from further
exercise thereof, or the exercise of any other right or remedy available to
Lender.

     9.5 CUMULATIVE RIGHTS.

     All rights and remedies available to Lender pursuant to this Agreement and
the Loan Documents are cumulative and in addition to any and all other rights
and remedies available to Lender at law or in equity.

     9.6 APPLICATION OF PROCEEDS.

     Any and all proceeds received by Lender in conjunction with the exercise
of any right or remedy relating to any Obligation shall be applied in the order
and in the manner set forth in Section 2.7 hereof.

     9.7. CERTAIN PROCEEDINGS.

     Borrower will promptly execute and deliver, and will cause the execution
and delivery by a Subsidiary of, all applications, certificates, instruments,
statements, and any and all other documents and agreements as Lender may
reasonably request in connection with obtaining any consent, approval,
registration, qualification, permit, license, or authorization of any Person
that is necessary, or appropriate to effectuate the exercise of any right or
remedy available to Lender pursuant to this Agreement and the Loan Documents.
Borrower agrees that the terms and provisions of this Section 9.7 may be
specifically enforced.

     9.8 EXPENDITURES BY LENDER.

     Borrower or the respective Subsidiary shall pay, within ten (10) Business
Days after request therefor, (a) reasonable costs, fees (including reasonable
attorney fees) and expenses

33

 

paid or incurred by Lender in connection with the preparation and
administration of this Agreement and all Loan Documents, and (b) all reasonable
costs, fees, and expenses of Lender in connection with the enforcement of any
Obligation hereunder or the exercise of any right or remedy pursuant to this
Agreement or any Loan Document. Any and all such costs, fees, and expenses
shall constitute Obligations owing hereunder and shall bear interest at the
Default Rate from the date on which the same are due and payable until the date
of payment by Borrower or the respective Subsidiary.

     In the event that any sum required to be paid by Borrower or a Subsidiary
pursuant to this Section 9.8 is not paid within ten (10) days from the date on
which request for payment is made by Lender, Borrower hereby authorizes Lender
to advance such sum(s) to itself from the FNCM Account. In the event that the
balance in the FNCM Account, after deduction of amounts in the FNCM Account
that are subject to Control Agreements, is insufficient to pay such
expenditure, the failure to reimburse Lender for payment of such expenditure
shall constitute an Event of Default hereunder.

SECTION 10. MISCELLANEOUS

     10.1 HEADINGS. The headings and captions used in this Agreement and in
any Loan Document are, unless otherwise specified, for convenience only and
shall not be deemed to limit, amplify, or modify the terms of this Agreement or
any Loan Document or affect the construction of any such terms or provisions.

     10.2 MODIFICATIONS, CONSENTS AND WAIVERS. No failure or delay on the part
of the Lender in exercising any power or right hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any such right or
power preclude any other or further exercise thereof or the exercise of any
other right or power hereunder. No modification or waiver of any provision of
this Agreement or of any Loan Document, nor consent to any departure by the
Borrower or a Subsidiary therefrom, shall in any event be effective unless the
same shall be in writing and signed by Lender, and then any such waiver or
consent shall be

34

 

effective only in the specific instance and for the purpose for which
given. No notice to or demand upon the Borrower or a Subsidiary in any case
shall, of itself, entitle the Borrower or a Subsidiary to any other or further
notice or demand in similar or other circumstances.

     10.3 ENTIRE AGREEMENT.

     This Agreement, the Loan Documents, any written supplements or
modifications thereto, and any instruments or documents delivered or required
to be delivered in connection herewith or therewith represent the entire
agreement and understanding between the parties regarding the subject matter
hereof, and all of such documents supersede any and all other prior agreements,
understandings, negotiations and discussions, representations, warranties,
commitments, proposals, offers and contracts regarding the subject matter
hereof, whether oral or written.

     10.4 ADDRESSES FOR NOTICES. All communications and notices provided for
hereunder shall be in writing and, if to the Lender, mailed or delivered to it,
addressed as follows:

	 	 	 
	

	 	First National Bank of Omaha
	

	 	1620 Dodge Street, Stop 4300
	

	 	Omaha, Nebraska, 68197-4300
	

	 	Attention: Senior Officer, Mortgage Loan Department
	 
	 	 
	With a copy to:

	 	Ronald L. Eggers, Esquire
	

	 	Gross & Welch, P.C.
	

	 	11404 W. Dodge Rd., Suite 580
	

	 	Omaha, NE 68154
	 
	 	 
	and if to the Borrower, mailed or delivered to it, addressed as follows:
	 
	 	 
	

	 	Mr. Thomas D. Peschio
	

	 	President and Chief Executive Officer
	

	 	Government Properties Trust, Inc.
	

	 	10250 Regency Circle, Suite 100
	

	 	Omaha, NE 68114
	 
	 	 
	

	 	and

35

 

	 	 	 
	

	 	Ms. Nancy D. Olson
	

	 	Chief Financial Officer and Treasurer
	

	 	Government Properties Trust, Inc.
	

	 	10250 Regency Circle, Suite 100
	

	 	Omaha, NE 68114
	 
	 	 
	With a copy to:

	 	James C. Creigh, Esq.
	

	 	Blackwell, Sanders, Peper, Martin, LLP
	

	 	1620 Dodge St., Suite 2100
	

	 	Omaha, NE 68102

or as to each party, at such other address as shall be designated by such party
in a written notice to the other party. Each such notice shall be deemed
effective upon receipt by the addressee.

     10.5 BINDING EFFECT AND ASSIGNMENT. This Agreement shall be binding upon
and inure to the benefit of the Borrower and the Lender, and their respective
successors and assigns, except that the Borrower may not assign or transfer its
rights hereunder without the prior written consent of the Lender.

     10.6 GOVERNING LAW. The validity, interpretation and enforcement of this
Agreement and all Loan Documents, and any dispute arising out of the
relationship between the parties hereto, whether in contract, tort, equity or
otherwise, shall be governed by the internal Laws of the State of Nebraska
(without giving effect to principles of conflicts of law, except to the extent
that realization upon the Collateral securing any Note may be subject to the
Laws of another state where the Collateral is located.

     Borrower irrevocably consents and submits to jurisdiction in the District
Court of Douglas County, Nebraska and the United States District Court for the
District of Nebraska and waives any objection based on venue or forum non
conveniens with respect to any action instituted in connection with this
Agreement or any Loan Document or in any manner related or incidental to the
transactions between the parties hereto with respect to this Agreement or any
other Loan Document, and Borrower agrees that any dispute with respect to any
such matters shall be heard only in the courts described above, provided, that
Lender may institute an action or proceeding against any Consolidated Company
or its property in the courts of any other

36

 

jurisdiction which Lender deems necessary or appropriate and to realize on the
Collateral or to otherwise enforce its rights against any Consolidated Company
or its property.

     BORROWER AND LENDER EACH HEREBY WAIVE ANY RIGHT TO TRIAL BY JURY OF ANY
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION (I) ARISING UNDER THIS AGREEMENT OR
ANY LOAN DOCUMENT OR (II) IN ANY MANNER CONNECTED WITH OR RELATED OR INCIDENTAL
TO THE TRANSACTIONS BETWEEN THE PARTIES HERETO WITH RESPECT TO THIS AGREEMENT
OR ANY OTHER LOAN DOCUMENT, WHETHER NOW EXISTING OR HEREAFTER ARISING, AND
WHETHER IN CONTRACT, TORT, EQUITY OR OTHERWISE. BORROWER AND LENDER EACH
HEREBY AGREE AND CONSENT THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION
SHALL BE DECIDED BY A COURT TRIAL WITHOUT A JURY AND THAT BORROWER OR LENDER
MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS AGREEMENT WITH ANY COURT AS
WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF THEIR
RIGHT TO TRIAL BY JURY.

     Lender shall not have any liability to any Consolidated Company, whether
in tort, contract, equity or otherwise, for losses suffered by any Consolidated
Company in connection with, arising out of, or in any manner related to the
transactions or relationships contemplated by this Agreement, or any act,
omission or event occurring in connection herewith, unless it is determined by
a final and nonappealable judgment binding on Lender, that the losses were the
result of acts or omissions constituting gross negligence or willful misconduct
by Lender. Lender shall, in any such litigation, be entitled to the benefit of
the rebuttable presumption that it acted in good faith and with the exercise of
ordinary care in the performance by it of the terms of this Agreement and any
Loan Document.

     10.7 NUMBER AND GENDER; ADDITIONAL REFERENCES.

     Unless otherwise specified in the Loan Documents (a) where appropriate,
the singular includes the plural, and vice versa, and words of any gender
include each other gender, (b)

37

 

heading and caption references may not be construed in interpreting
provisions, (c) monetary references are to currency of the United States of
America, (d) section, paragraph, annex, schedule, exhibit, and similar
references are to the particular Loan Document in which they are used, (e)
references to “telecopy”, “facsimile”, “fax” or similar terms relate to
facsimile or telecopy of transmissions, and (f) references to any Loan Document
or other document include every renewal and extension thereof, amendments and
supplements thereto, and replacements and substitutions thereof.

     10.8 WAIVER OF NOTICES.

     Borrower hereby expressly waives demand, presentment, protest and notice
of protest and notice of dishonor with respect to any and all Notes,
instruments and commercial paper included in or evidencing any of the
Obligations or the Collateral, and any and all other demands and notices of any
kind or nature whatsoever with respect to the Obligations, the Collateral and
this Agreement, except such as are expressly provided herein. No notice to or
demand on Borrower that Lender may elect to give shall entitle Borrower to any
other or further notice or demand in the same, similar, or other circumstances.

     10.9 INDEMNIFICATION.

     Borrower shall indemnify and hold Lender, and its officers, directors,
agents, employees and counsel harmless from and against any and all losses,
claims, damages, liabilities, costs or expenses imposed on, incurred by, or
asserted against any of them in connection with any litigation, investigation,
claim or proceeding commenced or threatened that relates to the negotiation,
preparation, execution, delivery, enforcement, performance or administration of
this Agreement, any other Loan Document, or any undertaking or proceeding
relating to any of the transactions contemplated hereby, or any act, omission,
event or transaction related or attendant thereto, including, without
limitation, amounts paid in settlement, court costs and reasonable attorney
fees. In the event that the undertaking to indemnify, pay and hold harmless
set forth in this Section 10.9 may be unenforceable because it violates any law
or public policy,

38

 

Borrower shall pay the maximum portion that it is permitted to pay under
applicable law to Lender in satisfaction of the indemnified matters included in
this Section. This indemnity shall survive the payment of the Obligations and
the termination or nonrenewal of this Agreement.

     10.10 PARTIAL INVALIDITY.

     In the event that any provision contained in this Agreement or any Loan
Document is held to be invalid or unenforceable, such invalidity or
unenforceability shall not invalidate this Agreement or such Loan Document in
its entirety, but this Agreement or such Loan Document shall be construed as
though it did not contain the particular provision held to be invalid or
enforceable, and the rights and obligations of the parties shall be construed
and enforced only to such extent as shall be permitted by applicable Law.

     10.11 COUNTERPARTS.

     This Agreement may be executed in several identical counterparts, each of
which shall be deemed an original for all purposes and all of which shall
constitute one agreement.

     10.12 PARTICIPANT.

     Borrower agrees and consents to Lender’s sale or transfer, at any time, of
one or more participation interests in this Agreement and any Note executed
pursuant to this Agreement to one or more purchasers (“Participant”), whether
related or unrelated to Lender. Lender may provide to any Participant or any
prospective participant, any information or knowledge Lender may have regarding
any Consolidated Company or any matter relating to this Agreement, and Borrower
hereby waives any rights to privacy it may have with respect to such matters.
Borrower additionally waives any and all notices of sale of participation
interests, as well as all notices of any repurchase of such participation
interests. Borrower also agrees that any Participant will be considered as the
absolute owner of such interest and will have all the rights granted under the
participation agreement(s) governing the sale of such participation interest.
Borrower further waives all rights of offset or counterclaim that it may now
have or hereafter acquire against Lender or any Participant, and
unconditionally agrees that either Lender or any

39

 

Participant may enforce Borrower’s obligations under this Agreement
irrespective of the failure or insolvency of any holder of any Participant
interest in the Loan. Borrower further agrees that any Participant may enforce
its interests irrespective of any personal claims or defenses that Borrower may
have against Lender.

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

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	GOVERNMENT PROPERTIES TRUST, INC.
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	 	 	 	 	 	 	 	By:	 	 	 	 	 	 	 	 
	

	 	 	 	 	 	 	 	 	 	
	 	 	 	 	 	 
	

	 	 	 	 	 	 	 	 	 	     Thomas D. Peschio,	 	 	 	 	 	 
	

	 	 	 	 	 	 	 	 	 	     President and CEO	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	FIRST NATIONAL BANK OF OMAHA
	 
	

	 	 	 	 	 	 	 	By:	 	 	 	 	 	 	 	 
	

	 	 	 	 	 	 	 	 	 	
	 	 	 	 	 	 
	

	 	 	 	 	 	 	 	 	 	     Daniel M. Shultz, Vice President	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	STATE OF NEBRASKA

	 	 	)	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	 	 	)	 	 	ss.	 	 	 	 	 	 	 	 	 	 
	COUNTY OF DOUGLAS

	 	 	)	 	 	 	 	 	 	 	 	 	 	 	 	 

     The foregoing instrument was acknowledged before me, a Notary Public, this
28th day of April, 2004, by Thomas D. Peschio, President and Chief Executive
Officer of Government Properties Trust, Inc., a Nebraska corporation on behalf
of said corporation.

	 	 	 	 	 	 	 	 	 
	

	 	 	 	 	 	 	 	

	

	 	 	 	 	 	 	 	Notary Public
	 
	 	 	 	 	 	 	 	 
	STATE OF NEBRASKA

	 	 	)	 	 	 	 	 
	

	 	 	)	 	 	ss.	 	 
	COUNTY OF DOUGLAS

	 	 	)	 	 	 	 	 

     The foregoing instrument was acknowledged before me, a Notary Public, this
28th day of April, 2004, by Daniel M. Shultz, Vice President of First National
Bank of Omaha, a national banking association, on behalf of said association.

	 	 	 	 	 	 	 
	

	 	 	 	 	 	

	

	 	 	 	 	 	Notary Public

40

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00066-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00066-of-00352.parquet"}]]