Document:

Exhibit 10.1

 

EXECUTION
VERSION

 

 

	
  AMENDED AND RESTATED CREDIT AGREEMENT

  
	
   

  
	
  Dated as of June 24, 2005

  
	
   

  
	
  by and among

  
	
   

  
	
  CORPORATE OFFICE PROPERTIES, L.P.,

  
	
   

  	
  as Borrower

  
	
   

  
	
  CORPORATE OFFICE PROPERTIES TRUST,

  
	
   

  	
  as Parent,

  
	
   

  
	
  WACHOVIA
  CAPITAL MARKETS, LLC

  
	
  and

  
	
  KEYBANK NATIONAL
  ASSOCIATION,

  
	
   

  	
  as Co-Arrangers,

  
	
   

  
	
  WACHOVIA
  BANK, NATIONAL ASSOCIATION,

  
	
   

  	
  as Administrative Agent,

  
	
   

  
	
  KEYBANC
  CAPITAL MARKETS,

  
	
   

  	
  as Syndication Agent,

  
	
   

  
	
  MANUFACTURERS
  AND TRADERS TRUST COMPANY,

  
	
  WELLS FARGO
  BANK, NATIONAL ASSOCIATION

  
	
  and

  
	
  BANK OF
  AMERICA, N.A.,

  
	
   

  	
  as Tri-Documentation Agents,

  
	
   

  
	
  and

  
	
   

  
	
  THE FINANCIAL INSTITUTIONS INITIALLY
  SIGNATORY HERETO

  
	
  AND THEIR ASSIGNEES PURSUANT TO
  SECTION 13.5.,

  
	
   

  	
  as Lenders

  

 

 

 

TABLE OF CONTENTS

 

	
  Article I.  Definitions

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 1.1.  Definitions

  	
   

  
	
   

  	
  Section 1.2.  General; References to Times

  	
   

  
	
   

  	
  Section 1.3.  Financial Attributes of Non-Wholly Owned
  Subsidiaries

  	
   

  
	
   

  	
   

  	
   

  
	
  Article II.
   Credit Facility

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 2.1.  Revolving Loans

  	
   

  
	
   

  	
  Section 2.2.  Swingline Loans

  	
   

  
	
   

  	
  Section 2.3.  Letters of Credit

  	
   

  
	
   

  	
  Section 2.4.  Rates and Payment of Interest on Loans

  	
   

  
	
   

  	
  Section 2.5.  Number of Interest Periods

  	
   

  
	
   

  	
  Section 2.6.  Repayment of Loans

  	
   

  
	
   

  	
  Section 2.7.  Prepayments

  	
   

  
	
   

  	
  Section 2.8.  Continuation

  	
   

  
	
   

  	
  Section 2.9.  Conversion

  	
   

  
	
   

  	
  Section 2.10.  Notes

  	
   

  
	
   

  	
  Section 2.11.  Voluntary Reductions of the Commitment

  	
   

  
	
   

  	
  Section 2.12.  Extension of Termination Date

  	
   

  
	
   

  	
  Section 2.13.  Expiration or Maturity Date of Letters of
  Credit Past Termination Date

  	
   

  
	
   

  	
  Section 2.14.  Amount Limitations

  	
   

  
	
   

  	
  Section 2.15.  Increase of Commitments

  	
   

  
	
   

  	
   

  	
   

  
	
  Article III.
   Payments, Fees and Other General
  Provisions

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 3.1.  Payments

  	
   

  
	
   

  	
  Section 3.2.  Pro Rata Treatment

  	
   

  
	
   

  	
  Section 3.3.  Sharing of Payments, Etc.

  	
   

  
	
   

  	
  Section 3.4.  Several Obligations

  	
   

  
	
   

  	
  Section 3.5.  Minimum Amounts

  	
   

  
	
   

  	
  Section 3.6.  Fees

  	
   

  
	
   

  	
  Section 3.7.  Computations

  	
   

  
	
   

  	
  Section 3.8.  Usury

  	
   

  
	
   

  	
  Section 3.9.  Agreement Regarding Interest and Charges

  	
   

  
	
   

  	
  Section 3.10.  Statements of Account

  	
   

  
	
   

  	
  Section 3.11.  Defaulting Lenders

  	
   

  
	
   

  	
  Section 3.12.  Taxes

  	
   

  
	
   

  	
   

  	
   

  
	
  Article IV.
   Borrowing Base Properties

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 4.1.  Eligibility of Properties

  	
   

  
	
   

  	
  Section 4.2.  Release of Properties

  	
   

  

 

 

	
   

  	
  Section 4.3.  Frequency of Calculations of Borrowing Base

  	
   

  
	
   

  	
   

  	
   

  
	
  Article V.
   Yield Protection, Etc.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 5.1.  Additional Costs; Capital Adequacy

  	
   

  
	
   

  	
  Section 5.2.  Suspension of LIBOR Loans

  	
   

  
	
   

  	
  Section 5.3.  Illegality

  	
   

  
	
   

  	
  Section 5.4.  Compensation

  	
   

  
	
   

  	
  Section 5.5.  Treatment of Affected Loans

  	
   

  
	
   

  	
  Section 5.6.  Change of Lending Office

  	
   

  
	
   

  	
  Section 5.7.  Assumptions Concerning Funding of LIBOR
  Loans

  	
   

  
	
   

  	
   

  	
   

  
	
  Article VI.
   Conditions Precedent

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 6.1.  Initial Conditions Precedent

  	
   

  
	
   

  	
  Section 6.2.  Conditions Precedent to All Loans and
  Letters of Credit

  	
   

  
	
   

  	
  Section 6.3.  Conditions as Covenants

  	
   

  
	
   

  	
   

  	
   

  
	
  Article VII.
   Representations and Warranties

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 7.1.  Representations and Warranties

  	
   

  
	
   

  	
  Section 7.2.  Survival of Representations and Warranties,
  Etc.

  	
   

  
	
   

  	
   

  	
   

  
	
  Article VIII.
   Affirmative Covenants

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 8.1.  Preservation of Existence and Similar
  Matters

  	
   

  
	
   

  	
  Section 8.2.  Compliance with Applicable Law and Material
  Contracts

  	
   

  
	
   

  	
  Section 8.3.  Maintenance of Property

  	
   

  
	
   

  	
  Section 8.4.  Conduct of Business

  	
   

  
	
   

  	
  Section 8.5.  Insurance

  	
   

  
	
   

  	
  Section 8.6.  Payment of Taxes and Claims

  	
   

  
	
   

  	
  Section 8.7.  Visits and Inspections

  	
   

  
	
   

  	
  Section 8.8.  Use of Proceeds; Letters of Credit

  	
   

  
	
   

  	
  Section 8.9.  Environmental Matters

  	
   

  
	
   

  	
  Section 8.10.  Books and Records

  	
   

  
	
   

  	
  Section 8.11.  Further Assurances

  	
   

  
	
   

  	
  Section 8.12.  New Subsidiaries/Guarantors

  	
   

  
	
   

  	
  Section 8.13.  REIT Status

  	
   

  
	
   

  	
  Section 8.14.  Exchange Listing

  	
   

  
	
   

  	
   

  	
   

  
	
  Article IX.
   Information

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 9.1.  Quarterly Financial Statements

  	
   

  
	
   

  	
  Section 9.2.  Year-End Statements

  	
   

  
	
   

  	
  Section 9.3.  Compliance Certificate

  	
   

  
	
   

  	
  Section 9.4.  Other Information

  	
   

  

 

3

 

	
  Article X.
   Negative Covenants

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 10.1.  Financial Covenants

  	
   

  
	
   

  	
  Section 10.2.  Restricted Payments

  	
   

  
	
   

  	
  Section 10.3.  Indebtedness

  	
   

  
	
   

  	
  Section 10.4.  Certain Permitted Investments

  	
   

  
	
   

  	
  Section 10.5.  Investments Generally

  	
   

  
	
   

  	
  Section 10.6.  Liens; Negative Pledges; Other Matters

  	
   

  
	
   

  	
  Section 10.7.  Merger, Consolidation, Sales of Assets and
  Other Arrangements

  	
   

  
	
   

  	
  Section 10.8.  Fiscal Year

  	
   

  
	
   

  	
  Section 10.9.  Modifications to Material Contracts

  	
   

  
	
   

  	
  Section 10.10.  Modifications
  of Organizational Documents

  	
   

  
	
   

  	
  Section 10.11.  Transactions
  with Affiliates

  	
   

  
	
   

  	
  Section 10.12.  ERISA
  Exemptions

  	
   

  
	
   

  	
   

  	
   

  
	
  Article XI.
   Default

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 11.1.  Events of Default

  	
   

  
	
   

  	
  Section 11.2.  Remedies Upon Event of Default

  	
   

  
	
   

  	
  Section 11.3.  Remedies Upon Default

  	
   

  
	
   

  	
  Section 11.4.  Allocation of Proceeds

  	
   

  
	
   

  	
  Section 11.5.  Collateral Account

  	
   

  
	
   

  	
  Section 11.6.  Performance by Agent

  	
   

  
	
   

  	
  Section 11.7.  Rights Cumulative

  	
   

  
	
   

  	
   

  	
   

  
	
  Article XII.
   The Agent

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 12.1.  Authorization and Action

  	
   

  
	
   

  	
  Section 12.2.  Agent’s Reliance, Etc.

  	
   

  
	
   

  	
  Section 12.3.  Notice of Defaults

  	
   

  
	
   

  	
  Section 12.4.  Wachovia as Lender

  	
   

  
	
   

  	
  Section 12.5.  Approvals of Lenders

  	
   

  
	
   

  	
  Section 12.6.  Lender Credit Decision, Etc.

  	
   

  
	
   

  	
  Section 12.7.  Indemnification of Agent

  	
   

  
	
   

  	
  Section 12.8.  Successor Agent

  	
   

  
	
   

  	
  Section 12.9.  Titled Agents

  	
   

  
	
   

  	
   

  	
   

  
	
  Article XIII.  Miscellaneous

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 13.1.  Notices

  	
   

  
	
   

  	
  Section 13.2.  Expenses

  	
   

  
	
   

  	
  Section 13.3.  Setoff

  	
   

  
	
   

  	
  Section 13.4.  Litigation; Jurisdiction; Other Matters;
  Waivers

  	
   

  
	
   

  	
  Section 13.5.  Successors and Assigns

  	
   

  
	
   

  	
  Section 13.6.  Amendments

  	
   

  

 

4

 

	
   

  	
  Section 13.7.  Nonliability of Agent and Lenders

  	
   

  
	
   

  	
  Section 13.8.  Confidentiality

  	
   

  
	
   

  	
  Section 13.9.  Indemnification

  	
   

  
	
   

  	
  Section 13.10.  Termination;
  Survival

  	
   

  
	
   

  	
  Section 13.11.  Severability
  of Provisions

  	
   

  
	
   

  	
  Section 13.12.  GOVERNING
  LAW

  	
   

  
	
   

  	
  Section 13.13.  Counterparts

  	
   

  
	
   

  	
  Section 13.14.  Obligations
  with Respect to Loan Parties

  	
   

  
	
   

  	
  Section 13.15.  Limitation
  of Liability

  	
   

  
	
   

  	
  Section 13.16.  Entire
  Agreement

  	
   

  
	
   

  	
  Section 13.17.  Construction

  	
   

  
	
   

  	
  Section 13.18.  Patriot
  Act

  	
   

  
	
   

  	
  Section 13.19.  No
  Novation

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  SCHEDULE 1.1(A)

  	
  List of Loan Parties

  	
   

  
	
  SCHEDULE 4.1.

  	
  Initial Borrowing Base Properties

  	
   

  
	
  SCHEDULE 7.1.(b)

  	
  Ownership Structure

  	
   

  
	
  SCHEDULE 7.1.(f)

  	
  Title to Properties; Liens

  	
   

  
	
  SCHEDULE 7.1.(g)

  	
  Indebtedness and Guaranties

  	
   

  
	
  SCHEDULE 7.1.(h)

  	
  Material Contracts

  	
   

  
	
  SCHEDULE 7.1.(i)

  	
  Litigation

  	
   

  
	
  SCHEDULE 7.1.(y)

  	
  Unencumbered Assets

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  EXHIBIT A

  	
  Form of Assignment and Acceptance Agreement

  	
   

  
	
  EXHIBIT B

  	
  Form of Borrowing Base Certificate

  	
   

  
	
  EXHIBIT C

  	
  Form of Notice of Borrowing

  	
   

  
	
  EXHIBIT D

  	
  Form of Notice of Continuation

  	
   

  
	
  EXHIBIT E

  	
  Form of Notice of Conversion

  	
   

  
	
  EXHIBIT F

  	
  Form of Notice of Swingline Borrowing

  	
   

  
	
  EXHIBIT G

  	
  Form of Amended and Restated Swingline Note

  	
   

  
	
  EXHIBIT H

  	
  Form of Amended and Restated Revolving Note

  	
   

  
	
  EXHIBIT I

  	
  Form of Opinion of Counsel

  	
   

  
	
  EXHIBIT J

  	
  Form of Compliance Certificate

  	
   

  
	
  EXHIBIT K

  	
  Form of Amended and Restated Guaranty

  	
   

  
				

 

5

 

THIS AMENDED AND RESTATED CREDIT AGREEMENT (this “Agreement”) dated as
of June 24, 2005 by and among CORPORATE OFFICE PROPERTIES, L.P., a limited
partnership formed under the laws of the State of Delaware (the “Borrower”),
CORPORATE OFFICE PROPERTIES TRUST, a real estate investment trust formed under
the laws of the State of Maryland (the “Parent”), each of the financial
institutions initially a signatory hereto together with their assignees
pursuant to Section 13.5.(d), each of WACHOVIA CAPITAL MARKETS, LLC and
KEYBANK NATIONAL ASSOCIATION, as Co-Arrangers (the “Co-Arrangers”), WACHOVIA BANK, NATIONAL ASSOCIATION,
as Agent, KEYBANC CAPITAL MARKETS, as Syndication Agent (the “Syndication Agent”),
each of MANUFACTURERS AND TRADERS TRUST COMPANY, WELLS FARGO BANK, NATIONAL
ASSOCIATION AND BANK OF AMERICA, N.A., as Tri-Documentation Agents (the “Tri-Documentation
Agents”), and each of the financial institutions initially a signatory hereto
together with their assignees pursuant to Section 13.5.(d).

 

WHEREAS, certain of the Lenders and other financial institutions have
made available to the Borrower a $300,000,000 revolving credit facility on the
terms and conditions contained in that certain Credit Agreement dated as of March 10,
2004 (as amended and in effect immediately prior to the date hereof, the “Existing
Credit Agreement”) by and among the Borrower, such Lenders, certain other
financial institutions, the Agent and the other parties thereof; and

 

WHEREAS, the Agent and the Lenders desire to amend and restate the
terms of the Existing Credit Agreement to make available to the Borrower a
revolving credit facility in the initial amount of $400,000,000, which will
include a $25,000,000 letter of credit subfacility and a $10,000,000 swingline subfacility, on the terms
and conditions contained herein.

 

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

 

ARTICLE I.  DEFINITIONS

 

Section 1.1.  Definitions.

 

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

 

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

 

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

 

“Adjusted EBITDA”
means, for any given period, (a) EBITDA for such period minus (b) Capital
Reserves for such period.

 

“Adjusted LIBOR”
means, with respect to each Interest Period for any LIBOR Loan, the rate
obtained by dividing (a) LIBOR for such Interest Period by (b) a
percentage equal to 1 minus the stated maximum rate (stated as a decimal) of
all reserves, if any, required to be

 

 

maintained with respect to Eurocurrency funding (currently referred to
as “Eurocurrency liabilities”) as specified in Regulation D of the Board
of Governors of the Federal Reserve System (or against any other category of
liabilities which includes deposits by reference to which the interest rate on
LIBOR Loans is determined or any applicable category of extensions of credit or
other assets which includes loans by an office of any Lender outside of the
United States of America to residents of the United States of America). Any
change in such maximum rate shall result in a change in Adjusted LIBOR on the
date on which such change in such maximum rate becomes effective.

 

“Adjusted Net Operating
Income” means, with respect to a Property for any given period, Net
Operating Income of such Property for such period minus Capital Reserves for
such period; provided, however, “Adjusted Net Operating Income” shall not be
less than zero.

 

“Adjusted Total Asset Value”
means Total Asset Value determined exclusive of assets that are owned by (a) Excluded
Subsidiaries or (b) Unconsolidated Affiliates of the Parent.

 

“Affiliate” means any Person (other than
the Agent or any Lender): (a) directly or indirectly controlling,
controlled by, or under common control with, the Parent; (b) directly or
indirectly owning or holding five percent (5.0%) or more of any Equity Interest
in the Parent; or (c) five percent (5.0%) or more of whose voting stock or
other Equity Interest is directly or indirectly owned or held by the
Parent.  For purposes of this definition,
“control” (including with correlative meanings, the terms “controlling”, “controlled
by” and “under common control with”) means the possession directly or
indirectly of the power to direct or cause the direction of the management and
policies of a Person, whether through the ownership of voting securities or by
contract or otherwise.  The Affiliates of
a Person shall include any officer or director of such Person.  In no event shall the Agent or any Lender be
deemed to be an Affiliate of the Borrower or the Parent.

 

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

 

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

 

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

 

“Applicable Margin” means the percentage
rate set forth below corresponding to the ratio of Total Indebtedness to Total
Asset Value as determined in accordance with Section 10.1. in effect at such time:

 

	
  Level

  	
   

  	
  Total
  Indebtedness to Total Asset Value

  	
   

  	
  Applicable
  Margin for

  LIBOR Loans

  	
   

  	
  Applicable
  Margin for

  Base Rate Loans

  	
   

  
	
  1

  	
   

  	
  Less than 0.50 to 1.00

  	
   

  	
  1.15

  	
  %

  	
  0.0

  	
  %

  
	
  2

  	
   

  	
  Greater than or equal to 0.50 to 1.00 and
  less than 0.55 to 1.00

  	
   

  	
  1.25

  	
  %

  	
  0.0

  	
  %

  
	
  3

  	
   

  	
  Greater than or equal to 0.55 to 1.00 and
  less than 0.60 to 1.00

  	
   

  	
  1.40

  	
  %

  	
  0.0

  	
  %

  
	
  4

  	
   

  	
  Greater than or equal to 0.60 to 1.00 and
  less than 0.65 to 1.00

  	
   

  	
  1.55

  	
  %

  	
  0.0

  	
  %

  

 

2

 

The Applicable Margin shall be determined by the Agent from time to
time, based on the ratio of Total Indebtedness to Total Asset Value as set
forth in the Compliance Certificate most recently delivered by the Borrower
pursuant to Section 9.3.  Any
adjustment to the Applicable Margin shall be effective (a) in the case of
a Compliance Certificate delivered in connection with quarterly financial
statements of the Borrower delivered pursuant to Section 9.1., as of the
date 55 days following the end of the last day of the applicable fiscal quarter
covered by such Compliance Certificate, (b) in the case of a Compliance
Certificate delivered in connection with annual financial statements of the
Borrower delivered pursuant to Section 9.2., as of the date 100 days
following the end of the last day of the applicable fiscal year covered by such
Compliance Certificate, and (c) in the case of any other Compliance
Certificate, as of the date 5 Business Days following the Agent’s request for
such Compliance Certificate.  If the
Borrower fails to deliver a Compliance Certificate pursuant to Section 9.3.,
the Applicable Margin shall equal the percentages corresponding to Level 3
until the date of the delivery of the required Compliance Certificate.  Notwithstanding the foregoing, for the period
from the Effective Date through but excluding the date on which the Agent first
determines the Applicable Margin as set forth above, the Applicable Margin
shall equal the percentages corresponding to Level 3.

 

“Arranger” means each of
Wachovia Capital Markets, LLC and KeyBank National Association, together with
its successors and permitted assigns.

 

“Assignee” has the meaning given that
term in Section 13.5.(d).

 

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

 

“Base Rate” means the per annum rate of
interest equal to the greater of (a) the Prime Rate or (b) the
Federal Funds Rate plus one-half of one percent (0.5%).  Any change in the Base Rate resulting from a
change in the Prime Rate or the Federal Funds Rate shall become effective as of
12:01 a.m. on the Business Day on which each such change occurs.  The Base Rate is a reference rate used by the
Lender acting as the Agent in determining interest rates on certain loans and
is not intended to be the lowest rate of interest charged by the Lender acting
as the Agent or any other Lender on any extension of credit to any debtor.

 

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

 

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

 

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

 

3

 

“Borrowing Base” means an amount equal
to the sum of the Borrowing Base Values of the Borrowing Base Properties as
determined and adjusted from time to time in accordance with Section 4.3.  To the extent that the aggregate Borrowing
Base Values of Wholly Owned Properties and Controlled Properties subject to a
Ground Lease exceeds 10% of the Borrowing Base such excess shall be excluded
from the Borrowing Base.

 

“Borrowing Base Certificate” means a
report in substantially the form of Exhibit B, certified by the chief
financial officer of the Borrower, setting forth the calculations required to
establish the Borrowing Base Value for each Borrowing Base Property and the
Borrowing Base for all Borrowing Base Properties as of a specified date, all in
form and detail satisfactory to the Agent.

 

“Borrowing Base Property” means a
Property which the Agent or the Requisite Lenders, as the case may be, have
agreed to include in calculations of the Borrowing Base pursuant to Section 4.1.  A Property shall cease to be a Borrowing Base
Property if at any time such Property shall cease to be a Wholly Owned
Property, a Controlled Property or an Eligible Property.

 

“Borrowing Base Value” means, with
respect to a Borrowing Base Property for any date of determination, an amount
equal to 65% of (a) in the case of Borrowing Base Properties owned for the
entire fiscal quarter most recently ended, the Unencumbered NOI for such Property
for the fiscal quarter most recently ending multiplied by 4, divided by the
Capitalization Rate; (b) in the case of Borrowing Base Properties that are
Development Properties, the GAAP book value of such Development Property
(including the Construction-in-Process), until the earlier of (i) the one
year anniversary date of project completion or (ii) the first full fiscal
quarter after the project achieves an Occupancy Rate of 85% and (c) in the
case of Borrowing Base Properties acquired during the fiscal quarter most
recently ended, the undepreciated GAAP book value of such Property.

 

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

 

“Capital Reserves” means, for any period
an amount with respect to any Office Property, an amount equal to (a) $0.40
per square foot multiplied by (b) a fraction, the numerator of
which is the number of days in such period and the denominator of which is
365.  If the term Capital Reserves is
used without reference to a specific Property, then the amount shall be determined
on an aggregate basis with respect to all Office Properties of the Parent and
its Subsidiaries and a proportionate share of all Office Properties of all
Unconsolidated Affiliates.

 

“Capitalization Rate” means 8.50%.

 

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

 

4

 

Capitalized Lease Obligation is the capitalized amount of such obligation
as would be required to be reflected on a balance sheet prepared in accordance
with GAAP as of the applicable date.

 

“Cash Equivalents” means:  (a) securities issued, guaranteed or
insured by the United States of America or any of its agencies with maturities
of not more than one year from the date acquired; (b) certificates of
deposit with maturities of not more than one year from the date acquired,
issued by a United States federal or state chartered commercial bank of
recognized standing, or a commercial bank organized under the laws of any other
country which is a member of the Organization for Economic Cooperation and
Development, or a political subdivision of any such country, acting through a
branch or agency, which bank has capital and unimpaired surplus in excess of
$500,000,000 and which bank or its holding company has a short-term commercial
paper rating of at least A-2 or the equivalent by S&P or at least P-2 or
the equivalent by Moody’s; (c) reverse repurchase agreements with terms of
not more than seven days from the date acquired, for securities of the type
described in clause (a) above and entered into only with commercial
banks having the qualifications described in clause (b) above; (d) commercial
paper issued by any Person incorporated under the laws of the United States of
America or any State thereof and rated at least A-2 or the equivalent thereof
by S&P or at least P-2 or the equivalent thereof by Moody’s, in each case
with maturities of not more than one year from the date acquired; and (e) investments
in money market funds registered under the Investment Company Act of 1940,
which have net assets of at least $500,000,000 and at least 85% of whose assets
consist of securities and other obligations of the type described in clauses (a) through
(d) above.

 

“Collateral Account” means a special
deposit account or securities account maintained by, or on behalf of, the Agent
and under its sole dominion and control.

 

“Commitment” means, as to each Lender
(other than the Swingline Lender), such Lender’s obligation (a) to make
Revolving Loans pursuant to Section 2.1., (b) to issue (in the case
of the Agent) or participate in (in the case of the Lenders) Letters of Credit
pursuant to Section 2.3.(a) and 2.3.(i), respectively (but in the case
of the Lender acting as the Agent excluding the aggregate amount of
participations in the Letters of Credit held by other Lenders) and (c) to
participate in Swingline Loans pursuant to Section 2.2.(e), in each case,
in an amount up to, but not exceeding, the amount set forth for such Lender on
its signature page hereto as such Lender’s “Commitment Amount” or as set
forth in the applicable Assignment and Acceptance Agreement, as the same may be
reduced from time to time pursuant to Section 2.11. or
as may be increased from time to time pursuant to Section 2.15 or as
appropriate to reflect any assignments to or by such Lender effected in
accordance with Section 13.5.

 

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

 

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

 

5

 

“Construction-in-Process”
means cash expenditures for land and improvements (including indirect costs
internally allocated and development costs) determined in accordance with GAAP
for all Properties that are under development or will commence development
within twelve months from any date of determination.

 

“Construction Budget” means the
fully-budgeted costs for the acquisition and construction of a given parcel of
real property (including, without limitation, the cost of acquiring such parcel
of real property, reserves for construction interest and operating deficits,
tenant improvements, leasing commissions and infrastructure costs) as
reasonably determined by the Borrower in good faith.

 

“Continue”, “Continuation”
and “Continued” each refers to the
continuation of a LIBOR Loan from one Interest Period to another Interest
Period pursuant to Section 2.8.

 

“Controlled Property” means an Eligible
Property that is not a Wholly-Owned Property and where the Borrower directly or
indirectly owns at least 80% of the Equity Interests of the Subsidiary that
owns such Property.

 

“Convert”, “Conversion”
and “Converted” each refers to the
conversion of a Revolving Loan of one Type into a Loan of another Type pursuant
to Section 2.9.

 

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

 

“Debt Service” means, for any period,
the sum of (a) Interest Expense for such period, and (b) all
regularly scheduled principal payments made with respect to Indebtedness of the
Parent and its Subsidiaries during such period, other than any balloon, bullet,
early repayment or similar principal payment which, in each case, repays such
Indebtedness in full.  Debt Service shall
include a proportionate share of items (a) and (b) of all
Unconsolidated Affiliates.  When
determining Debt Service, in lieu of including the annual principal payments
made in respect of the Jolly Knolls Debt in the actual fiscal quarter in which
such payments are made, an amount equal to one-fourth of such annual payments
shall be included in any given fiscal quarter. “Jolly Knolls Debt” means the
Indebtedness evidenced by the promissory notes having an aggregate face value
of approximately $25,668,315 made by a Subsidiary of the Borrower, payable to
an affiliate of Constellation Real Estate, Inc. and maturing December 2007.

 

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

 

“Defaulting Lender” has the meaning set
forth in Section 3.11.

 

“Derivatives
Contract” means any
and all rate swap transactions, basis swaps, credit derivative transactions,
forward rate transactions, commodity swaps, commodity options, forward
commodity contracts, equity or equity index swaps or options, bond or bond
price or bond index swaps or options or forward bond or forward bond price or
forward bond index

 

6

 

transactions, interest rate options, forward foreign exchange
transactions, cap transactions, floor transactions, collar transactions,
currency swap transactions, cross-currency rate swap transactions, currency
options, spot contracts, or any other similar transactions or any combination
of any of the foregoing (including any options to enter into any of the
foregoing), whether or not any such transaction is governed by or subject to
any master agreement.  Not in limitation
of the foregoing, the term “Derivatives Contract” includes any and all
transactions of any kind, and the related confirmations, which are subject to
the terms and conditions of, or governed by, any form of master agreement
published by the International Swaps and Derivatives Association, Inc.,
any International Foreign Exchange Master Agreement, or any other master
agreement, including any such obligations or liabilities under any such master
agreement.

 

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

 

“Development Property” means a Property (i) which is (A) under
development or which (as determined in good faith by the Borrower) will commence
development within twelve months of the date of determination or (B) an
Unstabilized Property; (ii) which is being developed to become an Office
Property or which, in the case of an Unstabilized Property, has been developed
as an Office Property; and (iii) which would satisfy the definition of
Eligible Property but for clause (a) thereof.

 

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

 

“EBITDA” means, with respect to a Person
for any period:  (a) net income (or
loss) of such Person for such period determined on a consolidated basis
(excluding any income or losses from minority interests in the case of the
Parent), in accordance with GAAP, exclusive of the following (but only
to the extent included in determination of such net income (loss)): (i) depreciation
and amortization expense; (ii) Interest Expense; (iii) income tax
expense; (iv) extraordinary or non-recurring gains and losses; plus (b) such
Person’s pro rata share of EBITDA of its Unconsolidated Affiliates.  EBITDA shall be adjusted to remove any impact
from straight line rent leveling adjustments required under GAAP and
amortization of deferred market rent into income pursuant to Statement of
Financial Accounting Standards number 141.

 

“Effective Date” means the later
of:  (a) the Agreement Date; and (b) the
date on which all of the conditions precedent set forth in Section 6.1. shall have been fulfilled or waived in writing by the
Requisite Lenders.

 

“Eligible Assignee” means any Person who
is, at the time of determination: (i)  a Lender
or an affiliate of a Lender; (ii) a commercial bank, trust, trust company,
insurance company,

 

7

 

investment bank or pension fund organized under the laws of the United
States of America, or any state thereof, and having total assets in excess of
$5,000,000,000; (iii) a savings and loan association or savings bank
organized under the laws of the United States of America, or any state thereof,
and having a tangible net worth of at least $500,000,000; or (iv) a
commercial bank organized under the laws of any other country which is a member
of the Organization for Economic Cooperation and Development, or a political
subdivision of any such country, and having total assets in excess of $10,000,000,000,
provided that such bank is acting through a branch or agency located in the
United States of America.  If such Person
is not currently a Lender or an affiliate of a Lender, such Person’s (or its
parent’s) senior unsecured long term indebtedness must be rated BBB or higher
by S&P, Baa2 or higher by Moody’s, or the equivalent or higher of either
such rating by another rating agency reasonably acceptable to the Agent.

 

“Eligible Property” means a Property
which satisfies all of the following requirements:  (a) such Property is an Office Property
or a Development Property; (b) such Property is located in one of the 48
contiguous states of the United States of America or in the District of
Columbia; (c) neither such Property, nor any interest of the Borrower or
any Subsidiary thereof therein, is subject to any Lien (other than Permitted
Liens described in clauses (a) through (f) of the definition thereof)
or any Negative Pledge; (d) if such Property is owned by a Subsidiary, (i) none
of the Borrower’s or the Parent’s direct or indirect ownership interest in such
Subsidiary is subject to any Lien (other than Permitted Liens described in
clauses (a) through (f) of the definition thereof) or any Negative
Pledge, (ii) the Borrower directly, or indirectly through a Subsidiary,
has the right to take the following actions without the need to obtain the
consent of any Person:  (A) to
create Liens on such Property as security for Indebtedness of the Parent, the
Borrower or such Subsidiary, as applicable and (B) to sell, transfer or
otherwise dispose of such Property, and (iii) such Property is a
Wholly-Owned Property or a Controlled Property; and (e) such Property is
free of all structural defects or major architectural deficiencies, title
defects, environmental conditions or other adverse matters except for defects,
deficiencies, conditions or other matters individually or collectively which
are not material to the profitable operation of such Property.

 

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

 

“Equity Interest” means, with respect to
any Person, any share of capital stock of (or other ownership or profit
interests in) such Person, any warrant, option or other right for the purchase
or other acquisition from such Person of any share of capital stock of (or
other ownership or profit interests in) such Person, any security convertible
into or exchangeable for any share of capital stock of (or other ownership or
profit interests in) such Person or warrant,

 

8

 

right or option for the purchase or other acquisition from such Person
of such shares (or such other interests), and any other ownership or profit
interest in such Person (including, without limitation, partnership, member or
trust interests therein), whether voting or nonvoting, and whether or not such
share, warrant, option, right or other interest is authorized or otherwise
existing on any date of determination.

 

“Equity Issuance” means any issuance or
sale by a Person of any Equity Interest and shall in any event include the
issuance of any Equity Interest upon the conversion or exchange of any security
constituting Indebtedness that is convertible or exchangeable, or is being
converted or exchanged, for Equity Interests.

 

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

 

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

 

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

 

“Excluded Subsidiary” means any
Subsidiary which holds title to assets which are or are to become collateral
for any Secured Indebtedness of such Subsidiary.

 

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

 

“Fair Market Value” means, with respect
to (a) a security listed on a national securities exchange or the NASDAQ
National Market, the price of such security as reported on such exchange by any
widely recognized reporting method customarily relied upon by financial
institutions and (b) with respect to any other property, the price which
could be negotiated in an arm’s-length free market transaction, for cash,
between a willing seller and a willing buyer, neither of which is under pressure
or compulsion to complete the transaction.

 

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

 

9

 

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

 

“Fixed Charges” means, for any period,
the sum of (a) Debt Service and (b) all Preferred Dividends paid
during such period.  Fixed Charges shall
include a proportionate share of items (a) and (b) with respect to
all Unconsolidated Affiliates.

 

“Floating Rate Indebtedness” means, with respect to any Person, all Indebtedness of such
Person which bears interest at a variable rate during the scheduled life of
such Indebtedness and for which such Person has not obtained interest rate swap
agreements, interest rate collar agreements or other similar Derivatives
Contracts which effectively cause such variable rates to be equivalent to fixed
rates.

 

“Funds From Operations” means, for a
given period, income of the Parent and its Subsidiaries available for common
shareholders before depreciation and amortization of real estate assets and
before extraordinary items less gains and losses on sale of real estate
determined on a consolidated basis in accordance with GAAP applied on a
consistent basis for such period. 
Adjustments for Unconsolidated Affiliates will be calculated to reflect
the Borrower’s pro rata share of funds from operations on the same basis.

 

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

 

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

 

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

 

“Ground Lease” means a ground lease containing the following terms and
conditions: (a) a remaining term (exclusive of any unexercised extension
options) of thirty (30) years or more from the Agreement Date; (b) the
right of the lessee to mortgage and encumber its interest in the leased
property without the consent of the lessor; (c) the obligation of the
lessor to give the holder of any mortgage Lien on such leased property written
notice of any defaults on the part of the lessee and agreement of such lessor
that such lease will not be terminated until such holder has had a reasonable
opportunity to cure or complete foreclosures, and fails to do so; (d) reasonable
transferability of the lessee’s interest under such lease, including ability to

 

10

 

sublease; and (e) such
other rights customarily required by mortgagees making a loan secured by the
interest of the holder of the leasehold estate demised pursuant to a ground
lease.

 

“Guarantor” means any Person that is a
party to the Guaranty as a “Guarantor” and in any event shall include the
Parent and each Material Subsidiary (unless an Excluded Subsidiary).

 

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

 

“Hazardous Materials” means all or any
of the following: (a) substances that are defined or listed in, or
otherwise classified pursuant to, any applicable Environmental Laws as “hazardous
substances”, “hazardous materials”, “hazardous wastes”, “toxic substances” or
any other formulation intended to define, list or classify substances by reason
of deleterious properties such as ignitability, corrosivity, reactivity,
carcinogenicity, reproductive toxicity, “TCLP” toxicity or “EP toxicity”; (b) oil,
petroleum or petroleum derived substances, natural gas, natural gas liquids or
synthetic gas and drilling fluids, produced waters and other wastes associated
with the exploration, development or production of crude oil, natural gas or
geothermal resources; (c) any flammable substances or explosives or any
radioactive materials; (d) asbestos in any form; (e) toxic mold; and (f) electrical
equipment which contains any oil or dielectric fluid containing levels of
polychlorinated biphenyls in excess of fifty parts per million.

 

“Indebtedness” means, with respect to a Person, at
the time of computation thereof, all of the following (without
duplication):  (a) all obligations
of such Person in respect of money borrowed; (b) all obligations of such
Person, whether or not for money borrowed (i) represented by notes
payable, or drafts accepted, in each case representing extensions of credit, (ii) evidenced
by bonds, debentures, notes or similar instruments, or (iii) constituting
purchase money indebtedness, conditional sales contracts, title retention debt
instruments or other similar instruments, upon which interest charges are
customarily paid or that are issued or assumed as full or partial payment for
property or services rendered; (c) Capitalized Lease Obligations of such
Person; (d) all reimbursement obligations of such Person under any letters
of credit or

 

11

 

acceptances (whether or not the same have been presented for payment); (e) all
Off-Balance Sheet Obligations of such Person; (f) all obligations of such
Person to purchase, redeem, retire, defease or otherwise make any payment in
respect of any Mandatorily Redeemable Stock issued by such Person or any other
Person, valued at the greater of its voluntary or involuntary liquidation
preference plus accrued and unpaid dividends; (g) all obligations of such
Person in respect of any purchase obligation, repurchase obligation, takeout
commitment or forward equity commitment, in each case evidenced by a binding
agreement (excluding any such obligation to the extent the obligation can be
satisfied by the issuance of Equity Interests (other than Mandatorily
Redeemable Stock)); (h) net obligations under any Derivatives Contract not
entered into as a hedge against existing Indebtedness, in an amount equal to
the Derivatives Termination Value thereof; (i) all Indebtedness of other
Persons which such Person has Guaranteed or is otherwise recourse to such
Person (except for guaranties of customary exceptions for fraud, misapplication
of funds, environmental indemnities and other similar exceptions to recourse
liability (but not exceptions relating to bankruptcy, insolvency, receivership
or other similar events)); (j) all Indebtedness of another Person secured
by (or for which the holder of such Indebtedness has an existing right,
contingent or otherwise, to be secured by) any Lien on property or assets owned
by such Person, even though such Person has not assumed or become liable for
the payment of such Indebtedness or other payment obligation; and (k) such
Person’s pro rata share of the Indebtedness of any Unconsolidated Affiliate of
such Person.  Indebtedness of any Person
shall include Indebtedness of any partnership or joint venture in which such
Person is a general partner or joint venturer to the extent of such Person’s
pro rata share of the ownership of such partnership or joint venture (except if
such Indebtedness, or portion thereof, is recourse to such Person, in which
case the greater of such Person’s pro rata portion of such Indebtedness or the
amount of the recourse portion of the Indebtedness, shall be included as
Indebtedness of such Person).  All Loans
and Letter of Credit Liabilities shall constitute Indebtedness of the Borrower.

 

“Intangible Assets” of any
Person means at any date the amount of (i) all write-ups (other than write-ups
resulting from write-ups of assets of a going concern business made within
twelve months after the acquisition of such business) in the book value of any
asset owned by such Person and (ii) all unamortized debt discount and
expense, unamortized deferred charges, capitalized start-up costs, goodwill,
patents, licenses, trademarks, trade names, copyrights, organization or
developmental expenses, covenants not to compete and other intangible items.

 

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

 

“Interest Expense”
means, for any period of determination, the Parent’s total interest expense for
such period determined in accordance with GAAP on a consolidated basis plus
the Parent’s pro rata share of Interest Expense from Unconsolidated Affiliates
of the Parent, without duplication for the most recent period.  Interest Expense shall include capitalized
interest other than capitalized interest funded under a construction loan
interest reserve account.

 

“Interest Period” means with respect to
any LIBOR Loan, each period commencing on the date such LIBOR Loan is made or
the last day of the next preceding Interest Period for such Loan and ending 1,
2, 3 or 6 months thereafter, as the Borrower may select in a Notice of
Borrowing, Notice of Continuation or Notice of Conversion, as the case may be,
except that each

 

12

 

Interest Period that commences on the last Business Day of a calendar
month shall end on the last Business Day of the appropriate subsequent calendar
month.  Notwithstanding the
foregoing:  (i) if any Interest
Period would otherwise end after the Termination Date, such Interest Period
shall end on the Termination Date; and (ii) each Interest Period that
would otherwise end on a day which is not a Business Day shall end on the
immediately following Business Day (or, if such immediately following Business
Day falls in the next calendar month, on the immediately preceding Business
Day).

 

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

 

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

 

“L/C Commitment Amount” equals
$25,000,000.

 

“Lender” means each financial
institution from time to time party hereto as a “Lender”, together with its
respective successors and permitted assigns, and as the context requires,
includes the Swingline Lender.

 

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

 

“Letter of Credit” has the meaning given
that term in Section 2.3.(a).

 

“Letter of Credit Documents” means, with
respect to any Letter of Credit, collectively, any application therefor, any
certificate or other document presented in connection with a drawing under such
Letter of Credit and any other agreement, instrument or other document
governing or providing for (a) the rights and obligations of the parties
concerned or at risk with respect to such Letter of Credit or (b) any
collateral security for any of such obligations.

 

“Letter of Credit Liabilities” means,
without duplication, at any time and in respect of any Letter of Credit, the
sum of (a) the Stated Amount of such Letter of Credit plus (b) the

 

13

 

aggregate unpaid principal amount of all
Reimbursement Obligations of the Borrower at such time due and payable in
respect of all drawings made under such Letter of Credit.  For purposes of this Agreement, a Lender
(other than the Lender acting as the Agent) shall be deemed to hold a Letter of
Credit Liability in an amount equal to its participation interest in the
related Letter of Credit under Section 2.3.(i), and the Lender acting as
the Agent shall be deemed to hold a Letter of Credit Liability in an amount
equal to its retained interest in the related Letter of Credit after giving
effect to the acquisition by the Lenders other than the Lender acting as the
Agent of their participation interests under such Section.

 

“Level” has the meaning
given that term in the definition of the term “Applicable Margin.”

 

“LIBOR” means, for any LIBOR Loan for
any Interest Period therefor, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) appearing on Telerate Page 3750 (or
any successor page) as the London interbank offered rate for deposits in
Dollars at approximately 11:00 a.m. (London time) two Business Days prior
to the first day of such Interest Period for a term comparable to such Interest
Period.  If for any reason such rate is
not available, the term “LIBOR” shall mean, for any LIBOR Loan for any Interest
Period therefor, the rate per annum (rounded upwards, if necessary, to the
nearest 1/100 of 1%) appearing on the Reuters Screen LIBO Page as the
London interbank offered rate for deposits in Dollars at approximately 11:00 a.m.
(London time) two Business Days prior to the first day of such Interest Period
for a term comparable to such Interest Period; provided, however, if more than
one rate is specified on the Reuters Screen LIBO Page, the applicable rate
shall be the arithmetic mean of all such rates. If for any reason none of the
foregoing rates is available, LIBOR shall be, for any Interest Period, the rate
per annum reasonably determined by the Agent as the rate of interest at which
Dollar deposits in the approximate amount of the LIBOR Loan comprising part of
such borrowing would be offered by the Agent to major banks in the London
interbank Eurodollar market at their request at or about 11:00 a.m.
(London time) two Business Days prior to the first day of such Interest Period
for a term comparable to such Interest Period.

 

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

 

“Lien” as applied to the property of any
Person means:  (a) any security
interest, encumbrance, mortgage, deed to secure debt, deed of trust, assignment
of leases and rents, pledge, lien, charge or lease constituting a Capitalized
Lease Obligation, conditional sale or other title retention agreement, or other
security title or encumbrance of any kind in respect of any property of such
Person, or upon the income, rents or profits therefrom; (b) any
arrangement, express or implied, under which any property of such Person is
transferred, sequestered or otherwise identified for the purpose of subjecting
the same to the payment of Indebtedness or performance of any other obligation
in priority to the payment of the general, unsecured creditors of such Person; (c) the
filing of any financing statement under the Uniform Commercial Code or its
equivalent in any jurisdiction, other than any precautionary filing not
otherwise constituting or giving rise to a Lien, including a financing
statement filed (i) in respect of a lease not constituting a Capitalized
Lease Obligation pursuant to Section 9-505 (or a successor provision) of
the Uniform Commercial Code or its equivalent as in effect in an applicable
jurisdiction or (ii) in connection with a sale or other disposition of
accounts or other assets not prohibited by

 

14

 

this Agreement in a transaction not
otherwise constituting or giving rise to a Lien; and (d) any agreement by
such Person to grant, give or otherwise convey any of the foregoing.

 

“Loan” means a Revolving Loan or a
Swingline Loan.

 

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

 

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

 

“Mandatorily Redeemable
Stock” means, with respect to any Person, any Equity Interest of
such Person which by the terms of such Equity Interest (or by the terms of any
security into which it is convertible or for which it is exchangeable or
exercisable), upon the happening of any event or otherwise (a) matures or
is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise
(other than an Equity Interest to the extent redeemable in exchange for common
stock or other equivalent common Equity Interests), (b) is convertible
into or exchangeable or exercisable for Indebtedness or Mandatorily Redeemable
Stock, or (c) is redeemable at the option of the holder thereof, in whole
or in part (other than an Equity Interest which is redeemable solely in
exchange for common stock or other equivalent common Equity Interests), in each
case on or prior to the date on which all Revolving Loans are scheduled to be
due and payable in full.

 

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

 

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

 

“Material Subsidiary”
means any Subsidiary to which more than 2.0% of Adjusted Total Asset Value
(excluding cash and cash equivalents) is attributable on an individual basis or
that owns a Wholly Owned Property or a Controlled Property which is included in
the calculation of the Borrowing Base.

 

“Moody’s” means Moody’s Investors
Service, Inc., and its successors.

 

15

 

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

 

“Mortgage Receivable”
means a promissory note secured by a Mortgage of which the Borrower, a
Guarantor or one of their respective Subsidiaries is the holder and retains the
rights of collection of all payments thereunder.

 

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

 

“Negative Pledge” means, with respect to
a given asset, any provision of a document, instrument or agreement (other than
any Loan Document) which prohibits or purports to prohibit the creation or
assumption of any Lien on such asset as security for Indebtedness of the Person
owning such asset or any other Person; provided, however, that an agreement
that conditions a Person’s ability to encumber its assets upon the maintenance
of one or more specified ratios that limit such Person’s ability to encumber
its assets but that do not generally prohibit the encumbrance of its assets, or
the encumbrance of specific assets, shall not constitute a Negative Pledge.

 

“Net Operating Income” means, with
respect to any Property for any period, the sum of the following (without
duplication): (a) rents and other revenues received in the ordinary course
from such Property (excluding pre-paid rents and revenues and security deposits
except to the extent applied in satisfaction of tenants’ obligations for rent) minus
(b) all expenses paid or accrued related to the ownership, operation or
maintenance of such Property, including but not limited to taxes, assessments
and the like, insurance, utilities, payroll costs, maintenance, repair and
landscaping expenses, marketing expenses, and general and administrative
expenses (including an appropriate allocation for legal, accounting,
advertising, marketing and other expenses incurred in connection with such
Property, but specifically excluding general overhead expenses of the Parent or
any Subsidiary and any property management fees) minus (c) the
greater of (i) the actual property management fee paid during such period
and (ii) an imputed management fee in the amount of 3.0% of the gross
revenues for such Property for such period. 
Net Operating Income of any Person shall include such Person’s pro rata
share of Net Operating Income of its Unconsolidated Affiliates.  Net Operating Income shall be adjusted to
remove any impact from straight line rent leveling adjustments required under
GAAP and amortization of deferred market rent into income pursuant to Statement
of Financial Accounting Standards number 141. 
For purposes of determining Borrowing Base Value, Unencumbered Asset
Value, Value and Total Asset Value, as applicable, with respect to any
Property, if the Borrower enters into a definitive lease with a lessee with
respect such Property for which such lessee has not yet occupied such Property
and has not yet made any rent payments to the Borrower, for the period not to
exceed six (6) months from the date of entering into such lease, “Net
Operating Income” shall be deemed to include the stated base rent scheduled to
be paid by such lessee minus

 

16

 

operating expenses projected to be incurred by the Borrower during such
period with respect to such Property (“Imputed Rent”), as reasonably determined
by the Borrower in good faith; provided, however, the Imputed Rent shall only
be calculated with respect to not more than four (4) Properties at any one
time.

 

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

 

“Nonrecourse Indebtedness” means, with
respect to a Person, Indebtedness for borrowed money (other than construction
completion guarantees with respect to Development Properties) in respect of
which recourse for payment is contractually limited to specific assets of such
Person encumbered by a Lien securing such Indebtedness; provided such
contractual limitation to specific assets may include customary exceptions for fraud, misapplication of funds, environmental
indemnities, and other similar exceptions to recourse liability.

 

“Note” means a Revolving Note or a
Swingline Note.

 

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

 

“Notice of Continuation” means a notice
in the form of Exhibit D to be delivered to the Agent pursuant to Section 2.8.
evidencing the Borrower’s request for the Continuation
of a LIBOR Loan.

 

“Notice of Conversion” means a notice in
the form of Exhibit E to be delivered to the Agent pursuant to Section 2.9.
evidencing the Borrower’s request for the Conversion
of a Loan from one Type to another Type.

 

“Notice of Swingline Borrowing” means a
notice in the form of Exhibit F to be delivered to the Agent pursuant to Section 2.2.
evidencing the Borrower’s request for a Swingline
Loan.

 

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

 

17

 

“Occupancy Rate” means, with respect to
a Property at any time, the ratio, expressed as a percentage, of (a) the
net rentable square footage of such Property occupied by tenants that are not
Affiliates paying rent at market rates pursuant to binding leases as to which
no monetary default has occurred and is continuing to (b) the aggregate
net rentable square footage of such Property; provided, however, for purposes
of the immediately preceding clause (a): (i) if such tenant has executed a
lease for space in such Property and the Borrower or such tenant’s agents are
in the process of preparing such space for physical occupancy, then such space
shall be considered occupied and (ii) net rentable square footage occupied
by the Parent or any Affiliate paying rent at market rates pursuant to binding
leases as to which no monetary default has occurred and is continuing (“Affiliate
Rented Space”) may be included in such calculation; provided, no more
than 30,000 square feet of Affiliate Rented Space shall be used in the
calculation of Occupancy Rates of the Properties; provided, further, to the
extent Affiliate Rented Space exceeds 30,000 square feet in the aggregate with
respect to all Properties, such excess shall be allocated pro rata among each
Property with respect to which Affiliate Rented Space was included in the
calculation of the Occupancy Rate for such Property to reduce the Affiliate
Rented Space used in such calculation.

 

“OFAC” means U.S. Department of the
Treasury’s Office of Foreign Assets Control and any successor Governmental
Authority.

 

“Off-Balance
Sheet Obligations”
means liabilities and obligations of the Parent, the Borrower, any Subsidiary
or any other Person in respect of “off-balance sheet arrangements” (as defined
in the SEC Off-Balance Sheet Rules) which the Parent would be required to
disclose in the “Management’s Discussion and Analysis of Financial Condition
and Results of Operations” section of the Parent’s report on Form 10-Q
or Form 10-K (or their equivalents) which the Parent is required to file
with the Securities and Exchange Commission (or any Governmental Authority
substituted therefor).  As used in this
definition, the term “SEC Off-Balance Sheet Rules” means the Disclosure in
Management’s Discussion and Analysis About Off-Balance
Sheet Arrangements, Securities Act Release No. 33-8182, 68 Fed. Reg. 5982 (Feb. 5, 2003) (codified at 17 CFR pts. 228, 229 and
249).

 

“Office Property” means any Property
improved with, and from which 80% of the rental income is derived from the use
of the Property as, office space.

 

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

 

“Participant” has the meaning given that
term in Section 13.5.(c).

 

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

 

“Permitted Liens” means, as to any
Person:  (a) Liens securing taxes,
assessments and other charges or levies imposed by any Governmental Authority
(excluding any Lien imposed pursuant to any of the provisions of ERISA or
pursuant to any Environmental Laws) or the claims of materialmen, mechanics,
carriers, warehousemen or landlords for labor, materials, supplies or rentals
incurred in the ordinary course of business, which are not at the time required

 

18

 

to be paid or discharged under Section 8.6.; (b) Liens
consisting of deposits or pledges made, in the ordinary course of business, in
connection with, or to secure payment of, obligations under workers’
compensation, unemployment insurance or similar Applicable Laws; (c) Liens
consisting of encumbrances in the nature of zoning restrictions, easements, and
rights or restrictions of record on the use of real property, which do not
materially detract from the value of such property or impair the use thereof in
the business of such Person; (d) the rights of tenants under leases or
subleases not interfering with the ordinary conduct of business of such Person;
(e) Liens in favor of the Agent for the benefit of the Lenders; (f) Liens
in favor of the Borrower or a Guarantor securing obligations owing by a
Subsidiary to the Borrower or a Guarantor, which obligations have been
subordinated to the obligations owing by the Borrower and the Guarantors under
the Loan Documents on terms satisfactory to the Agent; and (g) Liens in
existence as of the Agreement Date and set forth in Part II of Schedule 7.1.(f).

 

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

 

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

 

“Post-Default Rate” means, in respect of
any principal of any Loan or any other Obligation that is not paid when due
(whether at stated maturity, by acceleration, by optional or mandatory
prepayment or otherwise), a rate per annum equal to the Base Rate as in effect
from time to time plus the Applicable Margin for Base Rate Loans plus
four percent (4%).

 

“Preferred Dividends” means, for any
period and without duplication, all Restricted Payments paid during such period
on Preferred Securities issued by the Parent or a Subsidiary.  Preferred Dividends shall not include
dividends or distributions paid or payable (a) solely in Equity Interests
(other than Mandatorily Redeemable Stock) payable to holders of such class of
Equity Interests; (b) to the Parent or a Subsidiary; or (c) constituting
or resulting in the redemption of Preferred Securities, other than scheduled
redemptions not constituting balloon, bullet or similar redemptions in full.

 

“Preferred Securities” means, with
respect to any Person, Equity Interests in such Person which are entitled to
preference or priority over any other Equity Interest in such Person in respect
of the payment of dividends or distribution of assets upon liquidation or both.

 

“Prime Rate” means the rate of interest
per annum announced publicly by the Lender then acting as the Agent as its
prime rate from time to time.  The Prime
Rate is not necessarily the best or the lowest rate of interest offered by the
Lender acting as the Agent or any other Lender.

 

19

 

“Principal Office” means the office of
the Agent located at One Wachovia Center, Charlotte, North Carolina, or such
other office of the Agent as the Agent may designate from time to time.

 

“Property” means any parcel of real
property owned or leased (in whole or in part) or operated by the Parent, the
Borrower, any Subsidiary or any Unconsolidated Affiliate of the Parent.

 

“Register” has the meaning given that
term in Section 13.5.(e).

 

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

 

“Reimbursement Obligation” means the
absolute, unconditional and irrevocable obligation of the Borrower to reimburse
the Agent for any drawing honored by the Agent under a Letter of Credit.

 

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

 

“Requisite Lenders” means, as of any
date, Lenders having at least 66-2/3% of the aggregate amount of the
Commitments (not held by Defaulting Lenders who are not entitled to vote), or,
if the Commitments have been terminated or reduced to zero, Lenders holding at
least 66-2/3% of the principal amount of the aggregate outstanding Loans and
Letter of Credit Liabilities (not held by Defaulting Lenders who are not
entitled to vote).  Commitments,
Revolving Loans and Letter of Credit Liabilities held by Defaulting Lenders
shall be disregarded when determining the Requisite Lenders.

 

“Responsible Officer” means with respect
to the Parent or any Subsidiary, the chief executive officer, the chief
financial officer, or president of the Parent or such Subsidiary.

 

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

 

20

 

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

 

“Revolving Note” has the meaning given
that term in Section 2.10.(a).

 

“Sanctioned Entity” means (a) an
agency of the government of, (b) an organization directly or indirectly
controlled by, or (c) a Person resident in, in each case, a country that
is subject to a sanctions program identified on the list maintained by the OFAC
and published from time to time, as such program may be applicable to such
agency, organization or Person.

 

“Sanctioned Person” means a Person named
on the list of Specially Designated Nationals or Blocked Persons maintained by
the OFAC as published from time to time

 

“Secured Indebtedness” means, with
respect to a Person as of any given date, the aggregate principal amount of all
Indebtedness of such Person outstanding at such date and that is secured in any
manner by any Lien, and in the case of the Parent or the Borrower, shall
include (without duplication) the Parent’s or the Borrower’s, respectively, pro
rata share of the Secured Indebtedness of its Unconsolidated Affiliates.

 

“Secured Recourse
Indebtedness” means Secured
Indebtedness of the Parent and its Subsidiaries which is not Nonrecourse
Indebtedness.

 

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

 

“Solvent” means, when used with respect
to any Person, that (a) the fair value and the fair salable value of its
assets (excluding any Indebtedness due from any affiliate of such Person) are
each in excess of the fair valuation of its total liabilities (including all
contingent liabilities computed at the amount which, in light of all the facts
and circumstances existing at such time, represents the amount that could
reasonably be expected to become an actual and matured liability); (b) such
Person is able to pay its debts or other obligations in the ordinary course as
they mature; and (c) such Person has capital not unreasonably small to
carry on its business and all business in which it proposes to be engaged.

 

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

 

“Stabilized Property” means,
any Property that is not a Development Property.

 

“Stated Amount” means the amount
available to be drawn by a beneficiary under a Letter of Credit from time to time, as such amount may be increased or reduced from time
to time in accordance with the terms of such Letter of Credit.

 

“Subsidiary” means, for any Person, any
corporation, partnership or other entity of which at least a majority of the
securities or other ownership interests having by the terms thereof ordinary
voting power to elect a majority of the board of directors or other persons

 

21

 

performing similar functions of such corporation, partnership or other
entity (without regard to the occurrence of any contingency) is at the time
directly or indirectly owned or controlled by such Person or one or more
Subsidiaries of such Person or by such Person and one or more Subsidiaries of
such Person, and shall include all Persons the accounts of which are
consolidated with those of such Person pursuant to GAAP.

 

“Swingline Commitment” means the
Swingline Lender’s obligation to make Swingline Loans pursuant to Section 2.2.
in an amount up to, but not exceeding, $10,000,000,
as such amount may be reduced from time to time in accordance with the terms
hereof.

 

“Swingline Lender” means Wachovia.

 

“Swingline Loan” means a loan made by
the Swingline Lender to the Borrower pursuant to Section 2.2.(a).

 

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

 

“Tangible Net Worth” means, as of any
date of determination, the stockholders’ equity of the Parent and its
Subsidiaries determined on a consolidated basis plus (a) accumulated
depreciation and amortization minus the following (to the extent
reflected in determining stockholders’ equity of the Parent and its
Subsidiaries); (b) the amount of any write-up in the book value of any
assets contained in any balance sheet resulting from revaluation thereof or any
write-up in excess of the cost of such assets acquired; and (c) all
amounts appearing on the assets side of any such balance sheet for assets which
would be classified as intangible assets under GAAP excluding such intangibles
booked in connection with real estate acquisitions with above or below market
rents, all determined on a consolidated basis.

 

“Taxes” has the meaning given that term
in Section 3.12.

 

“Termination Date” means March 9,
2008, or such later date to which the Termination Date may be extended pursuant
to Section 2.12.

 

“Titled Agents” means each of the
Co-Arrangers, each of the Tri-Documentation Agents, the Syndication Agent and
their respective successors and permitted assigns.

 

“Total
Asset Value” means the sum of all of the following of the Parent and
its Subsidiaries on a consolidated basis, without duplication, determined in
accordance with GAAP applied on a consistent basis:  (a) cash and cash equivalents, plus (b) with
respect to each Stabilized Property owned by the Parent, the Borrower or any
Subsidiary, (i)(A) Net Operating Income attributable to such Stabilized
Property (excluding Net Operating Income attributable to such Stabilized
Property acquired during the four consecutive fiscal quarters most recently
ending or such Stabilized Property disposed of during the fiscal quarter most
recently ending) for the fiscal quarter most recently ended multiplied by 4,
divided by (ii) the Capitalization Rate, plus (c) the GAAP book value
of Properties acquired during the most recent period of four

 

22

 

consecutive quarters, plus (d) Construction-in-Process until the
earlier of the (i) one year anniversary date of project completion or (ii) the
first full fiscal quarter after the project achieves an Occupancy Rate of 85%,
plus (e) the GAAP book value of Unimproved Land, Mortgage Receivables and
other promissory notes.  The Parent’s pro
rata share of assets held by Unconsolidated Affiliates will be included in
Total Asset Value calculations consistent with the above described treatment
for wholly owned assets.  For purposes of
determining Total Asset Value, Net Operating Income from Properties acquired or
disposed of by the Parent and its Subsidiaries during the period of determination
shall be excluded from clause (b) above.

 

“Total
Indebtedness” means
all Indebtedness of the Parent and its Subsidiaries determined on a
consolidated basis.

 

“Type” with respect to any Revolving
Loan, refers to whether such Loan is a LIBOR Loan or Base Rate Loan.

 

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

 

“Unencumbered Adjusted NOI” means, for any period of determination, Adjusted Net
Operating Income from Wholly Owned Properties and the pro-rata share of
Adjusted Net Operating Income from Controlled Properties as adjusted for any
non-recurring items during the reporting period; provided, however, “Unencumbered
Adjusted NOI” shall not be less than zero.

 

“Unencumbered Asset Value”
means, without duplication, (a) (i) the Unencumbered NOI (excluding
Net Operating Income attributable to Development Properties or attributable to
Properties acquired during the four consecutive fiscal quarters most recently
ending or Properties disposed of during the fiscal quarter most recently
ending) for the fiscal quarter most recently ending times four divided by (ii) the
Capitalization Rate, plus (b) the GAAP book value of all Wholly Owned
Properties and the Borrower’s pro-rata share of the GAAP book value of Controlled
Properties, in each case, acquired during the period of four consecutive
quarters most recently ended, plus (c) the GAAP book value of Development
Property (including the Construction-in-Process), until the earlier of (i) the
one year anniversary date of project completion or (ii) the first full
fiscal quarter after the project achieves an Occupancy Rate of 85%.  For purposes of this definition, to the
extent the Unencumbered Asset Value
attributable to Development Properties would exceed 10% of the Unencumbered Asset Value, such excess
shall be excluded.

 

“Unencumbered NOI”
means, for any period of determination, Net Operating Income from Wholly Owned
Properties and the pro-rata share of NOI from Controlled Properties which have
been owned for the entire previous fiscal quarter as adjusted for any
non-recurring items during the reporting period; provided, however, “Unencumbered
NOI” shall not be less than zero.

 

23

 

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

 

“Unimproved Land”
means land with respect to which no development (other than improvements that
are not material and are temporary in nature) has occurred and for which no
development is planned in the 12 months following the date of determination.

 

“Unsecured Indebtedness”
means Indebtedness which is not Secured Indebtedness.

 

“Unsecured Interest Expense”
means, for any period of determination, Interest Expense for such period
attributable to Unsecured Indebtedness of the Parent and its Subsidiaries.

 

“Unstabilized Property” means a Property (a) the improvements on which were
completed within twelve months prior to any date of determination; and (b) which
has not achieved an Occupancy Rate of 85%.

 

“Value” means,
with respect to a Stabilized Property, (a)(i) the
Net Operating Income of such Stabilized Property for the fiscal quarter most
recently ended minus (ii) Capital Reserves for such period, if applicable,
times (b) 4 divided by (c) the Capitalization Rate; provided, with
respect to any Stabilized Property acquired during the most recent quarter, the
Value of such Stabilized Property shall be its GAAP book value.

 

“Wachovia” means Wachovia Bank, National
Association, together with its successors and assigns.

 

“Wholly Owned
Property” means an
Eligible Property which is wholly owned in fee simple (or leased under a Ground
Lease) by the Parent, the Borrower or a Guarantor.

 

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

 

Section 1.2.  General; References to
Times.

 

Unless otherwise indicated, all accounting terms, ratios and
measurements shall be interpreted or determined in accordance with GAAP;
provided that, if at any time any change in GAAP would affect the computation
of any financial ratio or requirement set forth in any Loan Document, and
either the Borrower or the Requisite Lenders shall so request, the Agent, the
Lenders and the Borrower shall negotiate in good faith to amend such ratio or
requirement to

 

24

 

preserve the original intent thereof in light of such change in GAAP
(subject to the approval of the Requisite Lenders); provided further that,
until so amended, (i) such ratio or requirement shall continue to be
computed in accordance with GAAP prior to such change therein and (ii) the
Parent shall provide to the Agent and the Lenders financial statements and
other documents required under this Agreement or as reasonably requested
hereunder setting forth a reconciliation between calculations of such ratio or
requirement made before and after giving effect to such change in GAAP.  References in this Agreement to “Sections”, “Articles”,
“Exhibits” and “Schedules” are to sections, articles, exhibits and schedules
herein and hereto unless otherwise indicated. 
References in this Agreement to any document, instrument or agreement (a) shall
include all exhibits, schedules and other attachments thereto, (b) shall
include all documents, instruments or agreements issued or executed in
replacement thereof, to the extent permitted hereby and (c) shall mean such
document, instrument or agreement, or replacement or predecessor thereto, as
amended, supplemented, restated or otherwise modified as of the date of this
Agreement and from time to time thereafter to the extent not prohibited hereby
and in effect at any given time. 
Wherever from the context it appears appropriate, each term stated in
either the singular or plural shall include the singular and plural, and
pronouns stated in the masculine, feminine or neuter gender shall include the
masculine, the feminine and the neuter. 
Unless explicitly set forth to the contrary, a reference to “Subsidiary”
means a Subsidiary of the Parent or a Subsidiary of such Subsidiary, a
reference to an “Affiliate” means a reference to an Affiliate of the Parent and
a reference to an “Unconsolidated Affiliate” means a reference to an
Unconsolidated Affiliate of the Parent. 
Titles and captions of Articles, Sections, subsections and clauses in
this Agreement are for convenience only, and neither limit
nor amplify the provisions of this Agreement. 
Unless otherwise indicated, all references to time are references to
Charlotte, North Carolina time.

 

Section 1.3.  Financial Attributes of Non-Wholly Owned
Subsidiaries.

 

When determining the Parent’s or the Borrower’s compliance with any
financial covenant contained in any of the Loan Documents, only the Parent’s or
the Borrower’s, respectively, pro rata share of the financial attributes of a
Subsidiary that is not a Wholly Owned Subsidiary (other than the Borrower)
shall be included.

 

ARTICLE II. CREDIT
FACILITY

 

Section 2.1.  Revolving Loans.

 

(a)           Generally.  Subject to the terms and conditions hereof,
during the period from the Effective Date to but excluding the Termination
Date, each Lender severally and not jointly agrees to make Revolving Loans to
the Borrower in an aggregate principal amount at any one time outstanding up
to, but not exceeding, lesser of (i) the amount of such Lender’s
Commitment and (ii) such Lender’s Commitment Percentage of the Borrowing
Base.  Subject to the terms and
conditions of this Agreement, during the period from the Effective Date to but
excluding the Termination Date, the Borrower may borrow, repay and reborrow
Revolving Loans hereunder.

 

(b)           Requesting Revolving
Loans.  The Borrower shall give the
Agent notice pursuant to a Notice of Borrowing or telephonic notice of each
borrowing of Revolving Loans.  Each
Notice of Borrowing shall be delivered to the Agent before 11:00 a.m. (i) in
the case of LIBOR

 

25

 

Loans, on the date three Business Days prior to the proposed date of
such borrowing and (ii) in the case of Base Rate Loans, on the date one
Business Day prior to the proposed date of such borrowing.  Any such telephonic notice shall include all
information to be specified in a written Notice of Borrowing and shall be
promptly confirmed in writing by the Borrower pursuant to a Notice of Borrowing
sent to the Agent by telecopy on the same day of the giving of such telephonic
notice.  The Agent will transmit by
telecopy the Notice of Borrowing (or the information contained in such Notice
of Borrowing) to each Lender promptly upon receipt by the Agent.  Each Notice of Borrowing or telephonic notice
of each borrowing shall be irrevocable once given and binding on the Borrower.

 

(c)           Disbursements of
Revolving Loan Proceeds.  No later
than 1:00 p.m. on the date specified in the Notice of Borrowing, each
Lender will make available for the account of its applicable Lending Office to
the Agent at the Principal Office, in immediately available funds, the proceeds
of the Revolving Loan to be made by such Lender.  With respect to Revolving Loans to be made
after the Effective Date, unless the Agent shall have been notified by any Lender
prior to the specified date of borrowing that such Lender does not intend to
make available to the Agent the Revolving Loan to be made by such Lender on
such date, the Agent may assume that such Lender will make the proceeds of such
Revolving Loan available to the Agent on the date of the requested borrowing as
set forth in the Notice of Borrowing and the Agent may (but shall not be
obligated to), in reliance upon such assumption, make available to the Borrower
the amount of such Revolving Loan to be provided by such Lender.  Subject to satisfaction of the applicable
conditions set forth in Article VI. for such
borrowing, the Agent will make the proceeds of such borrowing available to the
Borrower no later than 2:00 p.m. on the date and at the account specified
by the Borrower in such Notice of Borrowing.

 

(d)           Repayment of Loans
Outstanding under Existing Credit Agreement.  The Borrower and the Lenders agree that on
the Effective Date all Loans (as defined in the Existing Credit Agreement)
outstanding under the Existing Credit Agreement shall be repaid with the
proceeds of the initial Loans to be made by the Lenders hereunder.

 

Section 2.2.  Swingline Loans.

 

(a)           Swingline Loans.  Subject to the terms and conditions hereof,
during the period from the Effective Date to but excluding the Termination
Date, the Swingline Lender agrees to make Swingline Loans to the Borrower in an
aggregate principal amount at any one time outstanding up to, but not
exceeding, the amount of the Swingline Commitment.  If at any time the aggregate principal amount
of the Swingline Loans outstanding at such time exceeds the Swingline
Commitment in effect at such time, the Borrower shall immediately pay the Agent
for the account of the Swingline Lender the amount of such excess.  Subject to the terms and conditions of this
Agreement, the Borrower may borrow, repay and reborrow Swingline Loans
hereunder.

 

(b)           Procedure for
Borrowing Swingline Loans.  The
Borrower shall give the Agent and the Swingline Lender notice pursuant to a
Notice of Swingline Borrowing or telephonic notice of each borrowing of a
Swingline Loan.  Each Notice of Swingline
Borrowing shall be delivered to the Swingline Lender no later than 3:00 p.m.
on the proposed date of such borrowing. 
Any such notice given telephonically shall include all information to be
specified in

 

26

 

a written Notice of Swingline Borrowing and shall be promptly confirmed
in writing by the Borrower pursuant to a Notice of Swingline Borrowing sent to
the Swingline Lender by telecopy on the same day of the giving of such
telephonic notice.  On the date of the
requested Swingline Loan and subject to satisfaction of the applicable
conditions set forth in Article VI. for such
borrowing, the Swingline Lender will make the proceeds of such Swingline Loan
available to the Borrower in Dollars, in immediately available funds, at the
account specified by the Borrower in the Notice of Swingline Borrowing not
later than 4:00 p.m. on such date.

 

(c)           Interest.  Swingline Loans shall bear interest at a per
annum rate equal to the Base Rate plus the Applicable Margin for Base
Rate Loans.  Interest payable on
Swingline Loans is solely for the account of the Swingline Lender.  All accrued and unpaid interest on Swingline Loans
shall be payable on the dates and in the manner provided in Section 2.4. with respect to interest on Base Rate Loans (except as the
Swingline Lender and the Borrower may otherwise agree in writing in connection
with any particular Swingline Loan).

 

(d)           Swingline Loan
Amounts, Etc.  Each Swingline Loan
shall be in the minimum amount of $1,000,000 and integral multiples of $500,000
or such other minimum amounts agreed to by the Swingline Lender and the
Borrower.  Any voluntary prepayment of a
Swingline Loan must be in integral multiples of $100,000 or the aggregate
principal amount of all outstanding Swingline Loans (or such other minimum
amounts upon which the Swingline Lender and the Borrower may agree) and in
connection with any such prepayment, the Borrower must give the Swingline Lender
prior written notice thereof no later than 10:00 a.m. on the date of such
prepayment.  The Swingline Loans shall,
in addition to this Agreement, be evidenced by the Swingline Note.

 

(e)           Repayment and
Participations of Swingline Loans. 
The Borrower agrees to repay each Swingline Loan within one Business Day
of demand therefor by the Swingline Lender and in any event, within 5 Business
Days after the date such Swingline Loan was made.  Notwithstanding the foregoing, the Borrower
shall repay the entire outstanding principal amount of, and all accrued but
unpaid interest on, the Swingline Loans on the Termination Date (or such
earlier date as the Swingline Lender and the Borrower may agree in
writing).  In lieu of demanding repayment
of any outstanding Swingline Loan from the Borrower and if the Borrower has not
already submitted a timely Notice of Borrowing for the purpose of repaying such
Swingline Loan, the Swingline Lender may, on behalf of the Borrower (which
hereby irrevocably directs the Swingline Lender to act on its behalf for such
purpose), request a borrowing of Base Rate Loans from the Lenders in an amount
equal to the principal balance of such Swingline Loan.  The amount limitations of Section 3.5.(a) shall not apply to any borrowing of Base Rate
Loans made pursuant to this subsection. 
The Swingline Lender shall give notice to the Agent of any such
borrowing of Base Rate Loans not later than 12:00 noon on the proposed date of
such borrowing and the Agent shall give prompt notice of such borrowing to the
Lenders.  No later than 2:00 p.m. on
such date, each Lender will make available to the Agent at the Principal Office
for the account of Swingline Lender in immediately available funds, the
proceeds of the Base Rate Loan to be made by such Lender and, to the extent of
such Base Rate Loan, such Lender’s participation in the Swingline Loan so
repaid shall be deemed to be funded by the Base Rate Loan.  The Agent shall pay the proceeds of such Base
Rate Loans to the Swingline Lender, which shall apply such proceeds to repay
such Swingline Loan.  At the time

 

27

 

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

 

Section 2.3.  Letters of Credit.

 

(a)           Letters of Credit.  Subject to the terms and conditions of this
Agreement, the Agent, on behalf of the Lenders, agrees to issue for the account
of the Borrower during the period from and including the Effective Date to, but
excluding, the date 30 days prior to the Termination Date one or more letters
of credit (each a “Letter of Credit”) up to a maximum aggregate Stated Amount
at any one time outstanding not to exceed the L/C Commitment Amount.

 

(b)           Terms of Letters of
Credit.  At the time of issuance, the
amount, form, terms and conditions of each Letter of Credit, and of any drafts
or acceptances thereunder, shall be subject to approval by the Agent and the
Borrower.  Notwithstanding the foregoing,
in no event may the expiration date of any Letter of Credit extend beyond the
earlier of (i) the date one year from its date of issuance or (ii) the
Termination Date; provided, however, a Letter of Credit may contain

 

28

 

a provision providing for the automatic
extension of the expiration date in the absence of a notice of non-renewal from
the Agent but in no event shall any such provision permit the extension of the
expiration date of such Letter of Credit beyond the Termination Date.

 

(c)           Requests for
Issuance of Letters of Credit.  The
Borrower shall give the Agent written notice (or telephonic notice promptly
confirmed in writing) at least 5 Business Days prior to the requested date of
issuance of a Letter of Credit, such notice to describe in reasonable detail
the proposed terms of such Letter of Credit and the nature of the transactions
or obligations proposed to be supported by such Letter of Credit, and in any
event shall set forth with respect to such Letter of Credit the proposed (i) Stated
Amount, (ii) the beneficiary, and (iii) the expiration date.  The Borrower shall also execute and deliver
such customary letter of credit application forms as requested from time to
time by the Agent.  Provided the Borrower
has given the notice prescribed by the first sentence of this subsection and
subject to the other terms and conditions of this Agreement, including the
satisfaction of any applicable conditions precedent set forth in Article VI.,
the Agent shall issue the requested Letter of Credit on the requested date of
issuance for the benefit of the stipulated beneficiary.  Upon the written request of the Borrower, the
Agent shall deliver to the Borrower a copy of each issued Letter of Credit
within a reasonable time after the date of issuance thereof.  To the extent any term of a Letter of Credit
Document is inconsistent with a term of any Loan Document, the term of such
Loan Document shall control.

 

(d)           Reimbursement
Obligations.  Upon receipt by the
Agent from the beneficiary of a Letter of Credit of any demand for payment
under such Letter of Credit, the Agent shall promptly notify the Borrower of
the amount to be paid by the Agent as a result of such demand and the date on
which payment is to be made by the Agent to such beneficiary in respect of such
demand; provided, however, the Agent’s failure to give, or delay in giving,
such notice shall not discharge the Borrower in any respect from the applicable
Reimbursement Obligation.  The Borrower
hereby unconditionally and irrevocably agrees to pay and reimburse the Agent
for the amount of each demand for payment under such Letter of Credit on or
prior to the date on which payment is to be made by the Agent to the
beneficiary thereunder, without presentment, demand, protest or other
formalities of any kind (other than notice as provided in this
subsection).  Upon receipt by the Agent
of any payment in respect of any Reimbursement Obligation, the Agent shall
promptly pay to each Lender that has acquired a participation therein under the
second sentence of Section 2.3.(i) such Lender’s Commitment
Percentage of such payment.

 

(e)           Manner of
Reimbursement.  Upon its receipt of a
notice referred to in the immediately preceding subsection (d), the
Borrower shall advise the Agent whether or not the Borrower intends to borrow
hereunder to finance its obligation to reimburse the Agent for the amount of
the related demand for payment and, if it does, the Borrower shall submit a
timely request for such borrowing as provided in the applicable provisions of
this Agreement.  If the Borrower fails to
so advise the Agent, or if the Borrower fails to reimburse the Agent for a
demand for payment under a Letter of Credit by the date of such payment, then (i) if
the applicable conditions contained in Article VI. would permit the making
of Revolving Loans, the Borrower shall be deemed to have requested a borrowing
of Revolving Loans (which shall be Base Rate Loans) in an amount equal to the
unpaid Reimbursement Obligation and the Agent shall give each Lender prompt
notice of the amount of the Revolving Loan to be made available to the Agent
not later than 1:00 p.m. and (ii) if such conditions would not permit
the making of

 

29

 

Revolving Loans, the provisions of subsection (j) of this Section shall
apply.  The limitations of Section 3.5.(a) shall not apply to any borrowing of Base Rate
Loans under this subsection.

 

(f)            Effect of Letters
of Credit on Commitments.  Upon the
issuance by the Agent of any Letter of Credit and until such Letter of Credit
shall have expired or been terminated, the Commitment of each Lender shall be
deemed to be utilized for all purposes of this Agreement in an amount equal to
the product of (i) such Lender’s Commitment Percentage and (ii) the
sum of (A) the Stated Amount of such Letter of Credit plus (B) any
related Reimbursement Obligations then outstanding.

 

(g)           Agent’s Duties
Regarding Letters of Credit; Unconditional Nature of Reimbursement Obligations.  In examining documents presented in
connection with drawings under Letters of Credit and making payments under such
Letters of Credit against such documents, the Agent shall only be required to
use the same standard of care as it uses in connection with examining documents
presented in connection with drawings under letters of credit in which it has
not sold participations and making payments under such letters of credit.  The Borrower assumes all risks of the acts
and omissions of, or misuse of the Letters of Credit by, the respective
beneficiaries of such Letters of Credit. 
In furtherance and not in limitation of the foregoing, neither the Agent
nor any of the Lenders shall be responsible for (i) the form, validity,
sufficiency, accuracy, genuineness or legal effects of any document submitted
by any party in connection with the application for and issuance of or any
drawing honored under any Letter of Credit even if it should in fact prove to
be in any or all respects invalid, insufficient, inaccurate, fraudulent or
forged; (ii) the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign any Letter of Credit, or the
rights or benefits thereunder or proceeds thereof, in whole or in part, which
may prove to be invalid or ineffective for any reason; (iii) failure of
the beneficiary of any Letter of Credit to comply fully with conditions
required in order to draw upon such Letter of Credit; (iv) errors,
omissions, interruptions or delays in transmission or delivery of any messages,
by mail, cable, telex, telecopy or otherwise, whether or not they be in cipher;
(v) errors in interpretation of technical terms; (vi) any loss or
delay in the transmission or otherwise of any document required in order to
make a drawing under any Letter of Credit, or of the proceeds thereof; (vii) the
misapplication by the beneficiary of any Letter of Credit, or the proceeds of
any drawing under any Letter of Credit; or (viii) any consequences arising
from causes beyond the control of the Agent or the Lenders.  None of the above shall affect, impair or
prevent the vesting of any of the Agent’s or any Lender’s rights or powers
hereunder.  Any action taken or omitted
to be taken by the Agent under or in connection with any Letter of Credit, if
taken or omitted in the absence of gross negligence or willful misconduct (as determined
by a court of competent jurisdiction in a final, non-appealable judgment),
shall not create against the Agent or any Lender any liability to the Borrower
or any Lender.  In this regard, the
obligation of the Borrower to reimburse the Agent for any drawing made under
any Letter of Credit shall be absolute, unconditional and irrevocable and shall
be paid strictly in accordance with the terms of this Agreement and any other
applicable Letter of Credit Document under all circumstances whatsoever,
including without limitation, the following circumstances: (A) any lack of
validity or enforceability of any Letter of Credit Document or any term or
provisions therein; (B) any amendment or waiver of or any consent to
departure from all or any of the Letter of Credit Documents; (C) the
existence of any claim, setoff, defense or other right which the Borrower may
have at any time against the Agent,

 

30

 

any Lender, any beneficiary of a Letter of Credit or any other Person, whether
in connection with this Agreement, the transactions contemplated hereby or in
the Letter of Credit Documents or any unrelated transaction; (D) any
breach of contract or dispute between the Borrower, the Agent, any Lender or
any other Person; (E) any demand, statement or any other document
presented under a Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein or made in connection
therewith being untrue or inaccurate in any respect whatsoever; (F) any
non-application or misapplication by the beneficiary of a Letter of Credit of
the proceeds of any drawing under such Letter of Credit; (G) payment by
the Agent under any Letter of Credit against presentation of a draft or
certificate which does not strictly comply with the terms of such Letter of
Credit; and (H) any other act, omission to act, delay or circumstance
whatsoever that might, but for the provisions of this Section, constitute a
legal or equitable defense to or discharge of the Borrower’s Reimbursement
Obligations.  Notwithstanding anything to
the contrary contained in this Section or Section 13.9., but not in
limitation of the Borrower’s unconditional obligation to reimburse the Agent
for any drawing made under a Letter of Credit as provided in this Section, the
Borrower shall have no obligation to indemnify the Agent or any Lender in
respect of any liability incurred by the Agent or a Lender arising solely out
of the gross negligence or willful misconduct of the Agent or a Lender in respect
of a Letter of Credit as determined by a court of competent jurisdiction in a
final, non-appealable judgment.  Except
as otherwise provided in this Section, nothing in this Section shall
affect any rights the Borrower may have with respect to the gross negligence or
willful misconduct of the Agent or any Lender with respect to any Letter of
Credit.

 

(h)           Amendments, Etc.  The issuance by the Agent of any amendment,
supplement or other modification to any Letter of Credit shall be subject to
the same conditions applicable under this Agreement to the issuance of new
Letters of Credit (including, without limitation, that the request therefor be
made through the Agent), and no such amendment, supplement or other
modification shall be issued unless either (i) the respective Letter of
Credit affected thereby would have complied with such conditions had it
originally been issued hereunder in such amended, supplemented or modified form
or (ii) the Requisite Lenders (or all of the Lenders if required by Section 13.6.)
shall have consented thereto.  In
connection with any such amendment, supplement or other modification, the
Borrower shall pay the Fees, if any, payable under the last sentence of Section 3.6.(b).

 

(i)            Lenders’
Participation in Letters of Credit.  Immediately
upon the issuance by the Agent of any Letter of Credit each Lender shall be
deemed to have irrevocably and unconditionally purchased and received from the
Agent, without recourse or warranty, an undivided interest and participation to
the extent of such Lender’s Commitment Percentage of the liability of the Agent
with respect to such Letter of Credit, and each Lender thereby shall
absolutely, unconditionally and irrevocably assume, as primary obligor and not
as surety, and shall be unconditionally obligated to the Agent to pay and
discharge when due, such Lender’s Commitment Percentage of the Agent’s
liability under such Letter of Credit. 
In addition, upon the making of each payment by a Lender to the Agent in
respect of any Letter of Credit pursuant to the immediately following subsection (j),
such Lender shall, automatically and without any further action on the part of
the Agent or such Lender, acquire (i) a participation in an amount equal
to such payment in the Reimbursement Obligation owing to the Agent by the
Borrower in respect of such Letter of Credit and (ii) a participation in a
percentage equal to such Lender’s

 

31

 

Commitment Percentage in any interest or other amounts payable by the
Borrower in respect of such Reimbursement Obligation (other than the Fees
payable to the Agent pursuant to the third and last sentences of Section 3.6.(b)).

 

(j)            Payment Obligation
of Lenders.  Each Lender severally
agrees to pay to the Agent on demand in immediately available funds in Dollars
the amount of such Lender’s Commitment Percentage of each drawing paid by the
Agent under each Letter of Credit to the extent such amount is not reimbursed
by the Borrower pursuant to Section 2.3.(d); provided, however, that in
respect of any drawing under any Letter of Credit, the maximum amount that any
Lender shall be required to fund, whether as a Revolving Loan or as a
participation, shall not exceed such Lender’s Commitment Percentage of such
drawing.  If the notice referenced in the
second sentence of Section 2.3.(e) is
received by a Lender not later than 11:00 a.m., then such Lender shall
make such payment available to the Agent not later than 2:00 p.m. on the
date of demand therefor; otherwise, such payment shall be made available to the
Agent not later than 1:00 p.m. on the next succeeding Business Day.  Each such Lender’s obligation to make such
payments to the Agent under this subsection, and the Agent’s right to receive
the same, shall be absolute, irrevocable and unconditional and shall not be
affected in any way by any circumstance whatsoever, including without
limitation, (i) the failure of any other Lender to make its payment under
this subsection, (ii) the financial condition of the Borrower or any other
Loan Party, (iii) the existence of any Default or Event of Default,
including any Event of Default described in Section 11.1.(f) or 11.1.(g) or
(iv) the termination of the Commitments. 
Each such payment to the Agent shall be made without any offset, abatement,
withholding or deduction whatsoever.

 

(k)           Information to
Lenders.  Upon the request of any
Lender from time to time, the Agent shall deliver to such Lender information
reasonably requested by such Lender with respect to each Letter of Credit then
outstanding.  Other than as set forth in
this subsection, the Agent shall have no duty to notify the Lenders regarding
the issuance or other matters regarding Letters of Credit issued hereunder.  The failure of the Agent to perform its
requirements under this subsection shall not relieve any Lender from its
obligations under Section 2.3.(j).

 

Section 2.4.  Rates and Payment of
Interest on Loans.

 

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

 

(i)            during
such periods as such Loan is a Base Rate Loan, at the Base Rate (as in effect
from time to time) plus the Applicable Margin for Base Rate Loans; and

 

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

 

Notwithstanding the foregoing, during the continuance of an Event of
Default, the Borrower shall pay to the Agent for the account of each Lender
interest at the Post-Default Rate on the outstanding principal amount of any
Loan made by such Lender, on all Reimbursement

 

32

 

Obligations and on any other amount payable by the Borrower hereunder
or under the Notes held by such Lender to or for the account of such Lender
(including without limitation, accrued but unpaid interest to the extent
permitted under Applicable Law).

 

(b)           Payment of Interest.  Accrued and unpaid interest on each Loan
shall be payable (i) in the case of a Base Rate Loan, monthly in arrears
on the first day of each calendar month, (ii) in the case of a LIBOR Loan,
in arrears on the last day of each Interest Period therefor, and, if such
Interest Period is longer than three months, at three-month intervals following
the first day of such Interest Period, and (iii) in the case of any Loan,
in arrears upon the payment, prepayment or Continuation thereof or the
Conversion of such Loan to a Loan of another Type (but only on the principal
amount so paid, prepaid, Continued or Converted).  Interest payable at the Post-Default Rate shall
be payable from time to time on demand.  Promptly after the determination of any interest rate provided for
herein or any change therein, the Agent shall give notice thereof to the
Lenders to which such interest is payable and to the Borrower.  All determinations by the Agent of an
interest rate hereunder shall be conclusive and binding on the Lenders and the
Borrower for all purposes, absent manifest error.

 

Section 2.5.  Number of Interest Periods.

 

There may be no more than 8 different Interest Periods for LIBOR Loans
outstanding at the same time (for which purpose Interest Periods described in
the definition of the term “Interest Period” shall be deemed to be different
Interest Periods even if they are coterminous).

 

Section 2.6.  Repayment of Loans.

 

The Borrower shall repay the entire outstanding principal amount of,
and all accrued but unpaid interest on, the Revolving Loans on the Termination
Date.

 

Section 2.7.  Prepayments.

 

(a)           Optional.  Subject to Section 5.4., the Borrower
may prepay any Loan at any time without premium or penalty.  The Borrower shall give the Agent at least
one Business Day’s prior written notice of the prepayment of any Revolving
Loan.

 

(b)           Mandatory.

 

(i)            Commitment
Overadvance.  If at any time the
aggregate principal amount of all outstanding Revolving Loans, together with
the aggregate amount of all Letter of Credit Liabilities and the aggregate
principal amount of all outstanding Swingline Loans, exceeds the aggregate
amount of the Commitments in effect at such time, the Borrower shall
immediately pay to the Agent for the accounts of the Lenders the amount of such
excess.

 

(ii)           Borrowing
Base Overadvance.  If at any time the
aggregate principal amount of all outstanding Revolving Loans, together with
the aggregate amount of all Letter of Credit Liabilities and the aggregate
principal amount of all outstanding Swingline Loans, exceeds the Borrowing
Base, the Borrower shall within 5 Business

 

33

 

Days of the Borrower obtaining knowledge of the occurrence of any such
excess, eliminate such excess.  If such
excess is not eliminated within such time, then the entire outstanding
principal balance of all Loans, together with all accrued interest thereon, and
an amount equal to all Letter of Credit Liabilities for deposit into the Letter
of Credit Collateral Account, shall be immediately due and payable in full.

 

All payments under this subsection (b) shall be applied to
pay all amounts of principal outstanding on the Loans and any Reimbursement
Obligations pro rata in accordance with Section 3.2. and
if any Letters of Credit are outstanding at such time the remainder, if any,
shall be deposited into the Collateral Account for application to any
Reimbursement Obligations.  If the Borrower
is required to pay any outstanding LIBOR Loans by reason of this Section prior
to the end of the applicable Interest Period therefor, the Borrower shall pay
all amounts due under Section 5.4.

 

Section 2.8.  Continuation.

 

So long as no Event of Default shall exist, the Borrower may on any
Business Day, with respect to any LIBOR Loan, elect to maintain such LIBOR Loan
or any portion thereof as a LIBOR Loan by selecting a new Interest Period for
such LIBOR Loan.  Each new Interest
Period selected under this Section shall commence on the last day of the
immediately preceding Interest Period. 
Each selection of a new Interest Period shall be made by the Borrower
giving to the Agent a Notice of Continuation not later than 11:00 a.m. on
the third Business Day prior to the date of any such Continuation.  Such notice by the Borrower of a Continuation
shall be by telephone or telecopy, confirmed immediately in writing if by
telephone, in the form of a Notice of Continuation, specifying (a) the
proposed date of such Continuation, (b) the LIBOR Loans and portions
thereof subject to such Continuation and (c) the duration of the selected
Interest Period, all of which shall be specified in such manner as is necessary
to comply with all limitations on Loans outstanding hereunder.  Each Notice of Continuation shall be
irrevocable by and binding on the Borrower once given.  Promptly after receipt of a Notice of
Continuation, the Agent shall notify each Lender by telecopy, or other similar
form of transmission, of the proposed Continuation.  If the Borrower shall fail to select in a
timely manner a new Interest Period for any LIBOR Loan in accordance with this
Section, or if an Event of Default shall exist, such Loan will automatically, on
the last day of the current Interest Period therefor, Convert into a Base Rate
Loan notwithstanding the first sentence of Section 2.9. or
the Borrower’s failure to comply with any of the terms of such Section.

 

Section 2.9.  Conversion.

 

The Borrower may on any Business Day, upon the Borrower’s giving of a
Notice of Conversion to the Agent, Convert all or a portion of a Loan of one
Type into a Loan of another Type; provided, however, a Base Rate Loan may not
be Converted to a LIBOR Loan if an Event of Default
shall exist.  Any Conversion of a LIBOR
Loan into a Base Rate Loan shall be made on, and only on, the last day of an
Interest Period for such LIBOR Loan and, upon Conversion of a Base Rate Loan
into a LIBOR Loan, the Borrower shall pay accrued interest to the date of
Conversion on the principal amount so Converted.  Each such Notice of Conversion shall be given
not later than 11:00 a.m. on the Business Day prior to the date of any
proposed Conversion into Base Rate Loans and on the third Business Day prior to
the date of any proposed Conversion

 

34

 

into LIBOR Loans.  Promptly after receipt of a Notice of
Conversion, the Agent shall notify each Lender by telecopy, or other similar
form of transmission, of the proposed Conversion.  Subject to the restrictions specified above,
each Notice of Conversion shall be by telephone (confirmed immediately in
writing) or telecopy in the form of a Notice of Conversion specifying (a) the
requested date of such Conversion, (b) the Type of Loan to be Converted, (c) the
portion of such Type of Loan to be Converted, (d) the Type of Loan such
Loan is to be Converted into and (e) if such Conversion is into a LIBOR
Loan, the requested duration of the Interest Period of such Loan.  Each Notice of Conversion shall be irrevocable
by and binding on the Borrower once given.

 

Section 2.10.  Notes.

 

(a)           Revolving Note.  The Revolving Loans made by each Lender
shall, in addition to this Agreement, also be evidenced by a promissory note of
the Borrower substantially in the form of Exhibit H (each a “Revolving
Note”), payable to the order of such Lender in a principal amount equal to the
amount of its Commitment as originally in effect and otherwise duly completed.

 

(b)           Records.  The date, amount, interest rate, Type and
duration of Interest Periods (if applicable) of each Loan made by each Lender
to the Borrower, and each payment made on account of the principal thereof,
shall be recorded by such Lender on its books and such entries shall be binding
on the Borrower, absent manifest error; provided, however, that the failure of
a Lender to make any such record shall not affect the obligations of the
Borrower under any of the Loan Documents.

 

(c)           Lost,
Stolen, Destroyed or Mutilated Notes. Upon receipt by the Borrower of (i) written
notice from a Lender that a Note of such Lender has been lost, stolen,
destroyed or mutilated, and (ii) (A) in the case of loss, theft or
destruction, an unsecured agreement of indemnity from such Lender in form
reasonably satisfactory to the Borrower, or (B) in the case of mutilation,
upon surrender and cancellation of such Note, the Borrower shall at its own
expense execute and deliver to such Lender a new Note dated the date of such
lost, stolen, destroyed or mutilated Note.

 

Section 2.11.  Voluntary Reductions of the
Commitment.

 

The Borrower shall have the right to terminate or reduce the aggregate
unused amount of the Commitments (for which purpose use of the Commitments
shall be deemed to include the aggregate amount of Letter of Credit Liabilities
and the aggregate principal amount of all outstanding Swingline Loans) at any
time and from time to time without penalty or premium upon not less than 5
Business Days prior written notice to the Agent of each such termination or
reduction, which notice shall specify the effective date thereof and the amount
of any such reduction and shall be irrevocable once given and effective only
upon receipt by the Agent; provided, however, if the Borrower seeks to reduce
the aggregate amount of the Commitments below $150,000,000, then the
Commitments shall all automatically and permanently be reduced to zero.  The Agent will promptly transmit such notice
to each Lender.  The Commitments, once terminated
or reduced may not be increased or reinstated.

 

35

 

Section 2.12.  Extension of Termination
Date.

 

The Borrower shall have the right, exercisable one time, to extend the
Termination Date by one year.  The
Borrower may exercise such right only by executing and delivering to the Agent
at least 90 days but not more than 180 days prior to the current Termination
Date, a written request for such extension (an “Extension Request”).  The Agent shall forward to each Lender a copy
of the Extension Request delivered to the Agent promptly upon receipt
thereof.  Subject to satisfaction of the
following conditions, the Termination Date shall be extended for one year: (a) immediately
prior to such extension and immediately after giving effect thereto, (i) no
Default or Event of Default shall exist and (ii) the representations and
warranties made or deemed made by the Borrower and each other Loan Party in the
Loan Documents to which any of them is a party, shall be true and correct on
and as of the date of such extension with the same force and effect as if made
on and as of such date except to the extent that such representations and
warranties expressly relate solely to an earlier date (in which case such
representations and warranties shall have been true and accurate on and as of
such earlier date) and (b) the Borrower shall have paid the Fees payable
under Section 3.6.(c).

 

Section 2.13.  Expiration or Maturity Date of Letters of
Credit Past Termination Date.

 

If on the date the Commitments are terminated or reduced to zero
(whether voluntarily, by reason of the occurrence of an Event of Default or
otherwise), there are any Letters of Credit outstanding hereunder, the Borrower
shall, on such date, pay to the Agent an amount of money equal to the Stated
Amount of such Letter(s) of Credit for deposit into the Collateral Account.

 

Section 2.14.  Amount Limitations.

 

Notwithstanding any other term of this Agreement or any other Loan
Document, no Lender shall be required to make a Loan,
the Agent shall not be required to issue a Letter of Credit and no reduction of
the Commitments pursuant to Section 2.11. shall take effect, if
immediately after the making of such Loan, the issuance of such Letter of
Credit or such reduction in the Commitments, the aggregate principal amount of
all outstanding Revolving Loans, together with the aggregate principal amount
of all outstanding Swingline Loans and the aggregate amount of all Letter of
Credit Liabilities, would exceed the lesser of (i) aggregate amount of the
Commitments at such time or (ii) the Borrowing Base.

 

Section 2.15.  Increase of Commitments.

 

With the prior consent of the Agent, such consent not to be
unreasonably withheld, conditioned or delayed, the Borrower shall have the
right at any time and from time to time to request increases in the aggregate
amount of the Commitments (provided that after giving effect to any increases
in the Commitments pursuant to this Section, the aggregate amount of the
Commitments may not exceed $600,000,000) by providing written notice to the
Agent, which notice shall be irrevocable once given and shall be forwarded by
the Agent to each Lender; provided, however, the Borrower shall not have the
right to make more than 4 requests for increases in the aggregate amount of the
Commitments during the term of this Agreement. 
Each such increase in the Commitments must be in an aggregate minimum
amount of $25,000,000 and integral multiples of $5,000,000 in excess
thereof.  No Lender shall be required to
increase its

 

36

 

Commitment and any new Lender becoming a party to this Agreement in
connection with any such requested increase must be an Eligible Assignee.  If a new Lender becomes a party to this
Agreement, or if any existing Lender agrees to increase its Commitment, such Lender
shall on the date it becomes a Lender hereunder (or increases its Commitment,
in the case of an existing Lender) (and as a condition thereto) purchase from
the other Lenders its Commitment Percentage (or in the case of an existing
Lender, increase the amount of its Commitment Percentage), in each case, as
determined after giving effect to the increase of Commitments, of any
outstanding Revolving Loans, by making available to the Agent for the account
of such other Lenders at the Principal Office, in same day funds, an amount
equal to the sum of (A) the portion of the outstanding principal amount of
such Revolving Loans to be purchased by such Lender plus (B) the aggregate
amount of payments previously made by the other Lenders under Section 2.3.(j)
which have not been repaid plus (C) interest accrued and unpaid to and as
of such date on such portion of the outstanding principal amount of such
Revolving Loans.  The Borrower shall pay
to the Lenders amounts payable, if any, to such Lenders under Section 5.4.
as a result of the prepayment of any such Revolving
Loans.  No increase of the Commitments
may be effected under this Section if (x) a Default or Event of
Default shall be in existence on the effective date of such increase or
(y) any representation or warranty made or deemed made by the Borrower or
any other Loan Party in any Loan Document to which any such Loan Party is a
party is not (or would not be) true or correct on the effective date of such
increase and after giving effect thereto (except for representations or
warranties which expressly relate solely to an earlier date).  In connection with any increase in the
aggregate amount of the Commitments pursuant to this subsection, (a) any
Lender becoming a party hereto shall execute such documents and agreements as
the Agent may reasonably request and (b) the Borrower shall make
appropriate arrangements so that each new Lender, and any existing Lender
increasing its Commitment, receives a new or replacement Note, as appropriate,
in the amount of such Lender’s Commitment within 5 Business Days of the
effectiveness of the applicable increase in the aggregate amount of
Commitments.

 

ARTICLE III.  PAYMENTS, FEES AND OTHER GENERAL PROVISIONS

 

Section 3.1.  Payments.

 

Except to the extent otherwise provided herein, all payments of
principal, interest and other amounts to be made by the Borrower under this
Agreement or any other Loan Document shall be made in Dollars, in immediately
available funds, without deduction, set-off or counterclaim, to the Agent at its
Principal Office, not later than 2:00 p.m. on the date on which such
payment shall become due (each such payment made after such time on such due
date to be deemed to have been made on the next succeeding Business Day).  Subject to Section 11.4., the Borrower
may, at the time of making each payment under this Agreement or any Note,
specify to the Agent the amounts payable by the Borrower hereunder to which
such payment is to be applied.  Each
payment received by the Agent for the account of a Lender under this Agreement
or any Note shall be paid to such Lender at the applicable Lending Office of
such Lender no later than 4:00 p.m. on the date of receipt.  If the Agent fails to pay such amount to a
Lender as provided in the previous sentence, the Agent shall pay interest on
such amount until paid at a rate per annum equal to the Federal Funds Rate from
time to time in effect.  If the due date
of any payment under this Agreement or any other Loan Document would otherwise
fall on a day which

 

37

 

is not a Business Day such date shall be
extended to the next succeeding Business Day and interest shall be payable for
the period of such extension.

 

Section 3.2.  Pro Rata Treatment.

 

Except to the extent otherwise provided herein:  (a) each borrowing from the Lenders
under Section 2.1.(a), 2.2.(e) and 2.3.(e) shall
be made from the Lenders, each payment of the Fees under Section 3.6.(a),
the first sentence of Section 3.6.(b), and Section 3.6.(c) shall
be made for the account of the Lenders, and each termination or reduction of
the amount of the Commitments under Section 2.11. shall be applied to the
respective Commitments of the Lenders, pro rata according to the amounts of
their respective Commitments; (b) each payment or prepayment of principal
of Revolving Loans by the Borrower shall be made for the account of the Lenders
pro rata in accordance with the respective unpaid principal amounts of the
Revolving Loans held by them, provided that if immediately prior to giving
effect to any such payment in respect of any Revolving Loans the outstanding
principal amount of the Revolving Loans shall not be held by the Lenders pro
rata in accordance with their respective Commitments in effect at the time such
Loans were made, then such payment shall be applied to the Revolving Loans in
such manner as shall result, as nearly as is practicable, in the outstanding
principal amount of the Revolving Loans being held by the Lenders pro rata in
accordance with their respective Commitments; (c) each payment of interest
on Revolving Loans by the Borrower shall be made for the account of the Lenders
pro rata in accordance with the amounts of interest on such Loans then due and
payable to the respective Lenders; (d) the making, Conversion and Continuation
of Revolving Loans of a particular Type (other than Conversions provided for by
Section 5.5.) shall be made pro rata among the Lenders according to the
amounts of their respective Commitments (in the case of making of Loans) or
their respective Loans (in the case of Conversions and Continuations of Loans)
and the then current Interest Period for each Lender’s portion of each Loan of
such Type shall be coterminous; (e) the Lenders’ participation in, and
payment obligations in respect of, Letters of Credit under Section 2.3.,
shall be pro rata in accordance with their respective Commitments; and (f) the
Lenders’ participation in, and payment obligations in respect of, Swingline
Loans under Section 2.2., shall be pro rata in accordance with their respective
Commitments.  All payments of principal,
interest, fees and other amounts in respect of the Swingline Loans shall be for
the account of the Swingline Lender only (except to the extent any Lender shall
have acquired and funded a participating interest in any such Swingline Loan
pursuant to Section 2.2.(e), in which case such
payments shall be pro rata in accordance with such participating interests).

 

Section 3.3.  Sharing of Payments, Etc.

 

If a Lender shall obtain payment of any principal of, or interest on,
any Loan made by it to the Borrower under this Agreement, or shall obtain
payment on any other Obligation owing by the Borrower or a Loan Party through
the exercise of any right of set-off, banker’s lien or counterclaim or similar
right or otherwise or through voluntary prepayments directly to a Lender or
other payments made by the Borrower to a Lender not in accordance with the
terms of this Agreement and such payment should be distributed to the Lenders
pro rata in accordance with Section 3.2. or Section 11.4.,
as applicable, such Lender shall promptly purchase from the other Lenders
participations in (or, if and to the extent specified by such Lender, direct
interests in) the Loans made by the other Lenders or other Obligations owed to
such other Lenders in such

 

38

 

amounts, and make such other adjustments
from time to time as shall be equitable, to the end that all the Lenders shall
share the benefit of such payment (net of any reasonable expenses which may be
incurred by such Lender in obtaining or preserving such benefit) pro rata in
accordance with Section 3.2. or Section 11.4.,
as applicable.  To such end, all the
Lenders shall make appropriate adjustments among themselves (by the resale of participations
sold or otherwise) if such payment is rescinded or must otherwise be
restored.  The Borrower agrees that any
Lender so purchasing a participation (or direct interest) in the Loans or other
Obligations owed to such other Lenders may exercise all rights of set-off,
banker’s lien, counterclaim or similar rights with respect to such
participation as fully as if such Lender were a direct holder of Loans in the
amount of such participation.  Nothing
contained herein shall require any Lender to exercise any such right or shall
affect the right of any Lender to exercise, and retain the benefits of
exercising, any such right with respect to any other indebtedness or obligation
of the Borrower.

 

Section 3.4.  Several Obligations.

 

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

 

Section 3.5.  Minimum Amounts.

 

(a)           Borrowings and
Conversions.  Except as otherwise
provided in Sections 2.2.(e) and 2.3.(e),
each borrowing of Base Rate Loans shall be in an aggregate minimum amount of
$1,000,000 and integral multiples of $100,000 in excess thereof.  Each borrowing and each Conversion of LIBOR
Loans shall be in an aggregate minimum amount of $1,000,000 and integral
multiples of $1,000,000 in excess of that amount.

 

(b)           Prepayments.  Each voluntary prepayment of Revolving Loans
shall be in an aggregate minimum amount of $1,000,000 and integral multiples of
$500,000 in excess thereof (or, if less, the aggregate principal amount of
Revolving Loans then outstanding).

 

(c)           Reductions of
Commitments.  Each
reduction of the Commitments under Section 2.11.  shall
be in an aggregate minimum amount of $10,000,000 and integral multiples of
$5,000,000 in excess thereof.

 

(d)           Letters of Credit.  The initial Stated Amount of each Letter of
Credit shall be at least $100,000.

 

Section 3.6.  Fees.

 

(a)           Unused Fee.
During the period from the Effective Date to but excluding the Termination
Date, the Borrower agrees to pay to the Agent for the account of the Lenders an
unused facility fee with respect to the average daily difference between the (i) aggregate
amount of the Commitments and (ii) the aggregate principal amount of all
outstanding Revolving Loans plus the aggregate amount of all Letter of Credit
Liabilities (the “Unused Amount”).  Such
fee

 

39

 

shall be computed by multiplying the Unused
Amount with respect to such quarter by the corresponding per annum rate set
forth below:

 

	
  Unused Amount

  	
   

  	
  Unused
  Fee

  	
   

  
	
  Greater than or equal to 50% of the aggregate amount of Commitments

  	
   

  	
  0.250

  	
  %

  
	
  Less than 50% of the aggregate amount of Commitments

  	
   

  	
  0.125

  	
  %

  

 

Such fee shall be payable in arrears on the last day of each March,
June, September or December of each calendar year.  Any such accrued and unpaid fee shall also be
payable on the Termination Date or any earlier date of termination of the
Commitments or reduction of the Commitments to zero.

 

(b)           Letter of Credit
Fees.  The Borrower agrees to pay to
the Agent for the account of each Lender a letter of credit fee at a rate per
annum equal to the Applicable Margin for LIBOR Loans times the daily average
Stated Amount of each Letter of Credit for the period from and including the
date of issuance of such Letter of Credit (x) through and including the
date such Letter of Credit expires or is terminated or (y) to but
excluding the date such Letter of Credit is drawn in full.  The fees provided for in the immediately
preceding sentence shall be nonrefundable and payable in arrears on (i) the
last day of March, June, September and December in each year, (ii) the
Termination Date, (iii) the date the Commitments are terminated or reduced
to zero and (iv) thereafter from time to time on demand of the Agent.  In addition, the Borrower shall pay to the
Agent for its own account and not the account of any Lender, an issuance fee in
respect of each Letter of Credit equal to the greater of (i) $500 or (ii) one-eighth
of one percent (0.125%) per annum on the initial Stated Amount of such Letter
of Credit for the period from and including the date of issuance of such Letter
of Credit through and including the date such Letter of Credit is to terminate.  The fees provided for in the immediately
preceding sentence shall be nonrefundable and payable upon issuance.  The Borrower shall pay directly to the Agent
from time to time on demand all commissions, charges, costs and expenses in the
amounts customarily charged by the Agent from time to time in like
circumstances with respect to the issuance of each Letter of Credit, drawings,
amendments and other transactions relating thereto.

 

(c)           Extension Fee.  If the Borrower exercises its right to extend
the Termination Date pursuant to Section 2.12., the Borrower agrees to pay
to the Agent for the account of each Lender a fee equal to two-tenths of one
percent (0.2%) of the amount of such Lender’s Commitment (whether or not
utilized) at the time of such extension. 
Such fee shall be due and payable in full on the date the Agent receives
the Extension Request pursuant to such Section.

 

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

 

Section 3.7.  Computations.

 

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

 

40

 

the actual number of days elapsed; provided, however, any accrued interest
on any Base Rate Loan shall be computed on the basis of a year of 365 or 366
days, as applicable, and the actual number of days elapsed.

 

Section 3.8.  Usury.

 

In no event shall the amount of interest due or payable on the Loans or
other Obligations exceed the maximum rate of interest allowed by Applicable Law
and, if any such payment is paid by the Borrower or any other Loan Party or
received by any Lender, then such excess sum shall be credited as a payment of
principal, unless the Borrower shall notify the respective Lender in writing
that the Borrower elects to have such excess sum returned to it forthwith.  It is the express intent of the parties
hereto that the Borrower not pay and the Lenders not receive, directly or
indirectly, in any manner whatsoever, interest in excess of that which may be
lawfully paid by the Borrower under Applicable Law.

 

Section 3.9.  Agreement Regarding Interest
and Charges.

 

The parties hereto hereby agree and stipulate that the only charge
imposed upon the Borrower for the use of money in connection with this
Agreement is and shall be the interest specifically described in Section 2.4.(a)(i) and
(ii) and in Section 2.2.(c). 
Notwithstanding the foregoing, the parties hereto further agree and
stipulate that all agency fees, syndication fees, facility fees, closing fees,
letter of credit fees, underwriting fees, default charges, late charges,
funding or “breakage” charges, increased cost charges, attorneys’ fees and
reimbursement for costs and expenses paid by the Agent or any Lender to third
parties or for damages incurred by the Agent or any Lender, in each case in
connection with the transactions contemplated by this Agreement and the other
Loan Documents, are charges made to compensate the Agent or any such Lender for
underwriting or administrative services and costs or losses performed or
incurred, and to be performed or incurred, by the Agent and the Lenders in
connection with this Agreement and shall under no circumstances be deemed to be
charges for the use of money.  All
charges other than charges for the use of money shall be fully earned and
nonrefundable when due.

 

Section 3.10.  Statements of Account.

 

The Agent will account to the Borrower monthly with a statement of
Loans, Letters of Credit, accrued interest and Fees, charges and payments made
pursuant to this Agreement and the other Loan Documents, and such account
rendered by the Agent shall be deemed conclusive upon Borrower to the extent
the Borrower shall fail to object to such account in writing within 5 Business
Days of the receipt thereof.  The failure
of the Agent to deliver such a statement of accounts shall not relieve or
discharge the Borrower from any of its obligations hereunder.

 

Section 3.11.  Defaulting Lenders.

 

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

 

41

 

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

 

(b)           Purchase or
Cancellation of Defaulting Lender’s Commitment.  The Borrower may request the Agent to notify
the Lenders that a Lender has become a Defaulting Lender.  Any Lender who is not a Defaulting Lender
shall have the right, but not the obligation, in its sole discretion, to
acquire all of a Defaulting Lender’s Commitment.  Any Lender desiring to exercise such right
shall give written notice thereof to the Agent and the Borrower no sooner than
2 Business Days and not later than 5 Business Days after such Defaulting Lender
became a Defaulting Lender.  If more than
one Lender exercises such right, each such Lender shall have the right to
acquire an amount of such Defaulting Lender’s Commitment in proportion to its
Commitments to the aggregate Commitments of all Lenders exercising such
right.  If after such 5th Business Day,
the Lenders have not elected to purchase all of the Commitment of such
Defaulting Lender, then the Borrower may, by giving written notice thereof to
the Agent, such Defaulting Lender and the other Lenders, either (i) demand
that such Defaulting Lender assign its Commitment to an Eligible Assignee
subject to and in accordance with the provisions of Section 13.5.(d) for
the purchase price provided for below or (ii) terminate the Commitment of
such Defaulting Lender, whereupon such Defaulting Lender shall no longer be a
party hereto or have any rights or obligations hereunder or under any of the
other Loan Documents.  No party hereto
shall have any obligation whatsoever to initiate any such replacement or to
assist in finding an Eligible Assignee. 
Upon any such purchase or assignment, the Defaulting Lender’s interest
in the Loans and its rights hereunder (but not its liability in respect thereof
or under the Loan Documents or this Agreement to the extent the same relate to
the period prior to the effective date of the purchase) shall terminate on the
date of purchase, and the Defaulting Lender shall promptly execute all
documents reasonably requested to surrender and transfer such interest to the
purchaser or assignee thereof, including an appropriate Assignment and
Acceptance Agreement and, notwithstanding Section 13.5.(d), shall pay to
the Agent an assignment fee in the amount of $7,000.  The purchase price for the Commitment of a
Defaulting Lender shall be equal

 

42

 

to the amount of the principal balance of
the Loans outstanding and owed by the Borrower to the Defaulting Lender.  Prior to payment of such purchase price to a
Defaulting Lender, the Agent shall apply against such purchase price any
amounts retained by the Agent pursuant to the last sentence of the immediately
preceding subsection (a).  The
Defaulting Lender shall be entitled to receive amounts owed to it by the
Borrower under the Loan Documents which accrued prior to the date of the
default by the Defaulting Lender, to the extent the same are received by the
Agent from or on behalf of the Borrower. 
There shall be no recourse against any Lender or the Agent for the
payment of such sums except to the extent of the receipt of payments from any
other party or in respect of the Loans.

 

Section 3.12.  Taxes.

 

(a)           Taxes Generally.  All payments by the Borrower of principal of,
and interest on, the Loans and all other Obligations shall be made free and
clear of and without deduction for any present or future excise, stamp or other
taxes, fees, duties, levies, imposts, charges, deductions, withholdings or
other charges of any nature whatsoever imposed by any taxing authority, but
excluding (i) franchise taxes, (ii) any taxes imposed on or measured
by any Lender’s assets, net income, receipts or branch profits, (iii) any
taxes (other than withholding taxes) with respect to the Agent or a Lender that
would not be imposed but for a connection between the Agent or such Lender and
the jurisdiction imposing such taxes (other than a connection arising solely by
virtue of the activities of the Agent or such Lender pursuant to or in respect
of this Agreement or any other Loan Document), and (iv) any taxes, fees,
duties, levies, imposts, charges, deductions, withholdings or other charges to
the extent imposed as a result of the failure of the Agent or a Lender, as
applicable, to provide and keep current (to the extent legally able) any
certificates, documents or other evidence required to qualify for an exemption
from, or reduced rate of, any such taxes fees, duties, levies, imposts,
charges, deductions, withholdings or other charges or required by the
immediately following subsection (c) to be furnished by the Agent or
such Lender, as applicable (such non-excluded items being collectively called “Taxes”).  If any withholding or deduction from any
payment to be made by the Borrower hereunder is required in respect of any
Taxes pursuant to any Applicable Law, then the Borrower will:

 

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

 

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

 

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

 

(b)           Tax Indemnification.  If the Borrower fails to pay any Taxes when
due to the appropriate Governmental Authority or fails to remit to the Agent,
for its account or the account of the respective Lender, as the case may be,
the required receipts or other required documentary evidence, the Borrower
shall indemnify the Agent and the Lenders for any incremental Taxes,

 

43

 

interest or penalties that may become
payable by the Agent or any Lender as a result of any such failure.  For purposes of this Section, a distribution
hereunder by the Agent or any Lender to or for the account of any Lender shall
be deemed a payment by the Borrower.

 

(c)           Tax Forms.  Prior to the date that any Lender or
Participant organized under the laws of a jurisdiction outside the United
States of America becomes a party hereto, such Person shall deliver to the
Borrower and the Agent such certificates, documents or other evidence, as
required by the Internal Revenue Code or Treasury Regulations issued pursuant
thereto (including Internal Revenue Service Forms W-8ECI and W-8BEN, as applicable, or appropriate successor forms),
properly completed, currently effective and duly executed by such Lender or
Participant establishing that payments to it hereunder and under the Notes are (i) not
subject to United States Federal backup withholding tax and (ii) not
subject to United States Federal withholding tax imposed under the Internal
Revenue Code.  Each such Lender or
Participant shall, to the extent it may lawfully do so, (x) deliver further
copies of such forms or other appropriate certifications on or before the date
that any such forms expire or become obsolete and after the occurrence of any
event requiring a change in the most recent form delivered to the Borrower or
the Agent and (y) obtain such extensions of the time for filing, and renew such
forms and certifications thereof, as may be reasonably requested by the
Borrower or the Agent.  The Borrower
shall not be required to pay any amount pursuant to the last sentence of subsection (a) above
to any Lender or Participant that is organized under the laws of a jurisdiction
outside of the United States of America or the Agent, if it is organized under
the laws of a jurisdiction outside of the United States of America, if such
Lender, Participant or the Agent, as applicable, fails to comply with the
requirements of this subsection.  If any
such Lender or Participant, to the extent it may lawfully do so, fails to
deliver the above forms or other documentation, then the Agent may withhold
from any payments to be made to such Lender under any of the Loan Documents
such amounts as are required by the Internal Revenue Code. If any Governmental
Authority asserts that the Agent did not properly withhold or backup withhold,
as the case may be, any tax or other amount from payments made to or for the
account of any Lender, such Lender shall indemnify the Agent therefor,
including all penalties and interest, any taxes imposed by any jurisdiction on
the amounts payable to the Agent under this Section, and costs and expenses (including
all reasonable fees and disbursements of any law firm or other external counsel
and the allocated cost of internal legal services and all disbursements of
internal counsel) of the Agent.  The
obligation of the Lenders under this Section shall survive the termination
of the Commitments, repayment of all Obligations and the resignation or
replacement of the Agent.

 

ARTICLE IV.  BORROWING BASE PROPERTIES

 

Section 4.1.  Eligibility of Properties.

 

(a)           Initial Borrowing
Base Properties.  As of the date hereof,
the Lenders have approved for inclusion in calculations of the Borrowing Base,
the Properties identified on Schedule 4.1., as well as the Borrowing Base
Value initially attributable to each such Property.

 

(b)           Additional Borrowing
Base Properties.  Subject to the
immediately following subsection (e), if after the Effective Date the
Borrower desires that any additional Property be included in calculations of
the Borrowing Base, the Borrower shall so notify the Agent in writing and
provide the Agent with the following, in form and substance satisfactory to the
Agent:

 

44

 

(i)            If available, an
operating statement for such Property audited or certified by a representative
of the Borrower as being true and correct in all material respects and prepared
in accordance with GAAP for the previous three fiscal years, provided that,
with respect to any period such Property was not owned by the Borrower or a
Subsidiary, such information shall only be required to be delivered to the
extent reasonably available to the Borrower and such certification may be based
upon the best of the Borrower’s knowledge and provided further, the Borrower
shall provide such projections and other information concerning the anticipated
operation of such Property as the Agent may reasonably request;

 

(ii)           A current rent roll for
such Property certified by a representative of the Borrower as being true and
correct in all material respects, and one-year occupancy history of such
Property certified by a representative of the Borrower to be true and correct,
provided that, with respect to any period such Property was not owned by the
Borrower or a Subsidiary, such information shall only be required to be
delivered to the extent reasonably available to the Borrower and such
certification may be based upon the best of the Borrower’s knowledge;

 

(iii)          To the extent not
provided under the immediately preceding clause (i), such projections and other
information concerning the anticipated operation of such Property as the Agent
may reasonably request;

 

(iv)          Budgets
with respect to any capital expenditures to be made with respect to such
Property within the next twelve months; and

 

(v)           Such
other information the Agent may reasonably request in order to evaluate the
Property.

 

(c)           Nonconforming
Properties.  If a Property which the
Borrower wants to have included in calculations of the Borrowing Base does not
satisfy the requirements of an Eligible Property or is not a Wholly Owned
Property or a Controlled Property, then the Agent, upon written request of the
Borrower shall request that the Lenders determine whether such Property shall
be included as a Borrowing Base Property. 
In connection therewith, the Borrower shall deliver the information
required by the immediately preceding subsection (b) to each of the
Lenders.  If such a request is made by
the Agent to the Lenders, within 10 Business Days after the date on which a
Lender has received such request and all of the items referred to in the
immediately preceding subsection (b), such Lender shall notify the Agent
in writing whether or not such Lender accepts such Property as a Borrowing Base
Property.  If a Lender fails to give such
notice within such time period, such Lender shall be deemed to have approved such
Property as a Borrowing Base Property.  A
Property shall become a Borrowing Base Property under this subsection only
upon the approval of the Requisite Lenders.

 

(d)           Documents with
Respect to Subsidiary.  Upon the
approval of a Property owned by a Subsidiary that is not a Guarantor as a
Borrowing Base Property or in connection with the admission of such Property
pursuant to the immediately following subsection (e), the Borrower

 

45

 

shall deliver to the Agent, the items that
would have been delivered with respect to such Subsidiary under Sections
6.1.(a)(iv), (v), (ix) through (xii) and (xvi) as if such Subsidiary had
been a Guarantor on the Effective Date. 
Until such time as the Agent shall have received the items referred to
in the foregoing sentence with respect to each Subsidiary, the Borrowing Base
Value of any Borrowing Base Property owned by such Subsidiary shall be $0.

 

(e)           Admission of
Property Without Prior Notice and Certain
Documentation.  Notwithstanding the
preceding subsection (b), if the Borrower desires that a Property be
included in calculations of the Borrowing Base after the Agreement Date and the
Borrowing Base exceeds $600,000,000 at such time (provided, that, solely for
purposes of this Section 4.1.(e), the Borrowing
Base Values used to determine “Borrowing Base” shall not be subject to the 65%
limitation set forth in the definition of “Borrowing Base Value”), then:

 

(i)            The
Borrower need not deliver to the Agent the items referred to in the immediately
preceding subsection (b) prior to the inclusion of such Property in
calculations of the Borrowing Base (but shall deliver them when and as required
under Section 9.3.);

 

(ii)           The
Agent need not approve such Property prior to the inclusion of such Property in
calculations of the Borrowing Base; and

 

(iii)          If
such Property is owned by a Subsidiary that is not already a Guarantor, the
Borrower shall deliver to the Agent the items required to be delivered under
the immediately preceding subsection (d).

 

Section 4.2.  Release of Properties.

 

From time to time the Borrower may request, upon not less than 10 days
prior written notice to the Agent, that a Borrowing Base Property be no longer
considered a Borrowing Base Property, which release (the “Property Release”)
shall be effected by the Agent if the Agent determines all of the following
conditions are satisfied as of the date of such Property Release:

 

(a)           No Default or Event of
Default exists or will exist immediately after giving effect to such Property
Release and the reduction in the Borrowing Base by reason of the release of
such Property; and

 

(b)           The Borrower shall have
delivered to the Agent a Borrowing Base Certificate and Compliance Certificate
demonstrating on a pro forma basis, and the Agent shall have determined to its
satisfaction, that the outstanding principal balance of the Loans, together
with the Letter of Credit Liabilities, will not exceed the Borrowing Base after
giving effect to such request and any prepayment to be made and/or the
acceptance of any Property as an additional or replacement Borrowing Base
Property to be given concurrently with such request and that the Parent and the
Borrower will be in compliance with the covenants set forth in Section 10.1.
after giving effect to the Property Release.

 

46

 

Section 4.3.  Frequency of Calculations
of Borrowing Base.

 

Initially, the Borrowing Base shall be the amount set forth as such in
the Borrowing Base Certificate delivered under Section 6.1.  Thereafter, the Borrowing Base shall be the
amount set forth as such in the Borrowing Base Certificate delivered from time
to time under Article IX. or 4.2.(b).  Any increase in the Borrowing Base Value of a
Borrowing Base Property shall become effective as of the next determination of
the Borrowing Base Value as provided in this Section.

 

ARTICLE V.  YIELD PROTECTION, ETC.

 

Section 5.1.  Additional Costs; Capital
Adequacy.

 

(a)           Additional Costs.  The Borrower shall promptly pay to the Agent
for the account of a Lender from time to time such amounts as such Lender may
determine to be necessary to compensate such Lender for any costs incurred by
such Lender that it determines are attributable to its making or maintaining of
any LIBOR Loans or its obligation to make any LIBOR Loans hereunder, any
reduction in any amount receivable by such Lender under this Agreement or any
of the other Loan Documents in respect of any of such Loans or such obligation
or the maintenance by such Lender of capital in respect of its Loans or its
Commitment (such increases in costs and reductions in amounts receivable being
herein called “Additional Costs”), to the extent any such Additional Costs
result from any Regulatory Change that:  (i) changes
the basis of taxation of any amounts payable to such Lender under this
Agreement or any of the other Loan Documents in respect of any of such Loans or
its Commitment (other than taxes, fees, duties, levies, imposts, charges,
deductions, withholdings or other charges which are excluded from the
definition of Taxes pursuant to the first sentence of Section 3.12.(a));
or (ii) imposes or modifies any reserve, special deposit or similar
requirements (other than Regulation D of the Board of Governors of the Federal
Reserve System or other reserve requirement to the extent utilized in the
determination of Adjusted LIBOR for such Loan) relating to any extensions of
credit or other assets of, or any deposits with or other liabilities of, such
Lender, or any commitment of such Lender (including, without limitation, the
Commitment of such Lender hereunder); or (iii) has or would have the
effect of reducing the rate of return on capital of such Lender to a level
below that which such Lender could have achieved but for such Regulatory Change
(taking into consideration such Lender’s policies with respect to capital
adequacy).

 

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

 

47

 

(c)           Additional Costs in
Respect of Letters of Credit. 
Without limiting the obligations of the Borrower under the preceding
subsections of this Section (but without duplication), if as a result of
any Regulatory Change or any risk-based capital guideline or other requirement
heretofore or hereafter issued by any Governmental Authority there shall be
imposed, modified or deemed applicable any tax, reserve, special deposit,
capital adequacy or similar requirement against or with respect to or measured
by reference to Letters of Credit and the result shall be to increase the cost
to the Agent of issuing (or any Lender of purchasing participations in) or
maintaining its obligation hereunder to issue (or purchase participations in)
any Letter of Credit or reduce any amount receivable by the Agent or any Lender
hereunder in respect of any Letter of Credit, then, upon demand by the Agent or
such Lender, the Borrower shall pay promptly, and in any event within 3
Business Days of demand, to the Agent for its account or the account of such
Lender, as applicable, from time to time as specified by the Agent or a Lender,
such additional amounts as shall be sufficient to compensate the Agent or such
Lender for such increased costs or reductions in amount.

 

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

 

Section 5.2.  Suspension of LIBOR Loans.

 

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

 

(a)           the
Agent reasonably determines (which determination shall be conclusive) that by
reason of circumstances affecting the relevant market, adequate and reasonable
means do not exist for ascertaining Adjusted LIBOR for such Interest Period, or

 

(b)           the
Agent reasonably determines (which determination shall be conclusive) that
Adjusted LIBOR will not adequately and fairly reflect the cost to the Lenders
of making or maintaining LIBOR Loans for such Interest Period;

 

then the Agent shall give the Borrower and each Lender prompt notice
thereof and, so long as such condition remains in effect, the Lenders shall be
under no obligation to, and shall not, make additional LIBOR Loans, Continue
LIBOR Loans or Convert Loans into LIBOR Loans and the Borrower shall, on the
last day of each current Interest Period for each outstanding LIBOR Loan,
either repay such Loan or Convert such Loan into a Base Rate Loan.

 

48

 

Section 5.3.  Illegality.

 

Notwithstanding any other provision of this Agreement, if any Lender
shall reasonably determine (which determination shall be conclusive and
binding) that it has become unlawful for such Lender to honor its obligation to
make or maintain LIBOR Loans hereunder, then such Lender shall promptly notify
the Borrower thereof (with a copy to the Agent) and such Lender’s obligation to
make or Continue, or to Convert Loans of any other Type into, LIBOR Loans shall
be suspended until such time as such Lender may again make and maintain LIBOR
Loans (in which case the provisions of Section 5.5. shall be applicable).

 

Section 5.4.  Compensation.

 

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

 

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

 

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

 

Upon the Borrower’s request, any Lender requesting compensation under
this Section shall provide the Borrower with a statement setting forth the
basis for requesting such compensation and the method for determining the
amount thereof.  Absent manifest error,
determinations by any Lender in any such statement shall be conclusive,
provided that such determinations are made on a reasonable basis and in good
faith.

 

Section 5.5.  Treatment of Affected
Loans.

 

If the obligation of any Lender to make LIBOR Loans or to Continue, or
to Convert Base Rate Loans into, LIBOR Loans shall be suspended pursuant to Section 5.1.(b),
5.2. or 5.3., then such Lender’s LIBOR Loans shall be automatically Converted
into Base Rate Loans on the last day(s) of the then current Interest Period(s)
for LIBOR Loans (or, in the case of a Conversion required by Section 5.1.(b) or 5.3., on such earlier date as such Lender may
specify to the Borrower with a copy to the Agent) and, unless and until such
Lender gives notice as provided below that the circumstances specified in Section 5.1.
or 5.3. that gave rise to
such Conversion no longer exist:

 

49

 

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

 

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

 

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

 

Section 5.6.  Change of Lending Office.

 

Each Lender agrees that it will use reasonable efforts to designate an
alternate Lending Office with respect to any of its Loans affected by the
matters or circumstances described in Sections 3.12., 5.1. or 5.3. to reduce the liability of
the Borrower or avoid the results provided thereunder, so long as such
designation is not disadvantageous to such Lender as determined by such Lender
in its sole discretion, except that such Lender shall have no obligation to
designate a Lending Office located in the United States of America.

 

Section 5.7.  Assumptions Concerning
Funding of LIBOR Loans.

 

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

 

ARTICLE VI.  CONDITIONS PRECEDENT

 

Section 6.1.  Initial Conditions
Precedent.

 

The obligation of the Lenders to effect or permit the occurrence of the
first Credit Event hereunder, whether as the making of a Loan or the issuance
of a Letter of Credit, is subject to the following conditions precedent:

 

50

 

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

 

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

 

(ii)           Revolving
Notes executed by the Borrower, payable to each Lender and complying with the
applicable provisions of Section 2.10. and the
Swingline Note executed by the Borrower;

 

(iii)          The
Guaranty executed by each Guarantor existing as of the Effective Date;

 

(iv)          An
opinion of the general counsel of the Parent and the Loan Parties, addressed to
the Agent, the Lenders and the Swingline Lender, addressing the matters set
forth in Exhibit I;

 

(v)           An
opinion of Alston & Bird, LLP, counsel to the Agent, addressed to the
Agent, the Lenders and the Swingline Lender, addressing the enforceability of
the Loan Documents and such matters as the Agent shall reasonably request;

 

(vi)          a
certificate of incumbency signed by the Secretary or Assistant Secretary of the
Parent with respect to each of the officers of the Parent authorized to execute
and deliver on behalf of the Parent and the Borrower the Loan Documents to
which the Parent or the Borrower is a party and to execute and deliver (or make
by telephone in the case of Notices of Conversion or Continuation) on behalf of
the Borrower Notices of Borrowing, Notices of Conversion, Notices of
Continuation, Notices of Swingline Borrowing and requests for Letters of
Credit;

 

(vii)         a certified copy (certified by the Secretary or Assistant
Secretary of the Parent) of all necessary action taken by the Parent to
authorize the execution, delivery and performance of the Loan Documents to
which either the Parent or the Borrower is a party;

 

(viii)        the certificate or articles of incorporation, articles
of organization, certificate of limited partnership, declaration of trust or
other comparable organizational instrument (if any) of the Parent, the Borrower
and each Guarantor, certified as of a recent date by the Secretary of State of
the State of formation of such Person;

 

(ix)           a Certificate of Good
Standing or certificate of similar meaning with respect to the Parent, the
Borrower and each Guarantor (and in the case of a limited partnership, the
general partner of such Guarantor) issued as of a recent date by the Secretary
of State of the State of formation of each such Person and certificates of
qualification to transact business or other comparable certificates issued by
each Secretary of State (and any state department of taxation, as applicable)
of each state in which such Person is required to be so qualified;

 

51

 

(x)            a
certificate of incumbency signed by the Secretary or Assistant Secretary (or
other individual performing similar functions) of each Guarantor with respect
to each of the officers of such Person authorized to execute and deliver the
Loan Documents to which such Person is a party;

 

(xi)           copies
certified by the Secretary or Assistant Secretary (or other individual
performing similar functions) of the Parent, the Borrower and each Guarantor of
the by-laws of such Person, if a corporation, the operating agreement, if a
limited liability company, the partnership agreement, if a limited or general
partnership, or other comparable document in the case of any other form of
legal entity;

 

(xii)          copies
certified by the Secretary or Assistant Secretary (or other individual
performing similar functions) of each Guarantor of all corporate, partnership,
member or other necessary action taken by each Guarantor to authorize the
execution, delivery and performance of the Loan Documents to which it is a
party;

 

(xiii)         the
Fees then due and payable under Section 3.6., and any other Fees payable
to the Agent, the Titled Agents and the Lenders on or prior to the Effective
Date;

 

(xiv)        a Compliance Certificate calculated as of March 31,
2005;

 

(xv)         a Borrowing Base Certificate calculated as of the Effective
Date; and

 

(xvi)        Such
other documents, agreements and instruments as the Agent on behalf of the
Lenders may reasonably request; and

 

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

 

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

 

(ii)           No
litigation, action, suit, investigation or other arbitral, administrative or
judicial proceeding shall be pending or threatened which could reasonably be
expected to (1) result in a Material Adverse Effect or (2) restrain
or enjoin, impose materially burdensome conditions on, or otherwise materially
and adversely affect the ability of the Borrower or any other Loan Party to
fulfill its obligations under the Loan Documents to which it is a party;

 

(iii)          The
Borrower and its Subsidiaries shall have received all approvals, consents and
waivers, and shall have made or given all necessary filings and notices as
shall be required to consummate the transactions contemplated hereby without
the occurrence of any default under, conflict with or violation of (1) any
Applicable Law or

 

52

 

(2) any agreement, document or instrument to which the Borrower or
any other Loan Party is a party or by which any of them or their respective
properties is bound, except for such approvals, consents, waivers, filings and
notices the receipt, making or giving of which would not reasonably be likely
to (A) have a Material Adverse Effect, or (B) restrain or enjoin,
impose materially burdensome conditions on, or otherwise materially and
adversely affect the ability of the Borrower or any other Loan Party to fulfill
its obligations under the Loan Documents to which it is a party; and

 

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

 

Section 6.2.  Conditions Precedent to All
Loans and Letters of Credit.

 

The obligations of the Lenders to make any Loans, of the Agent to issue
Letters of Credit, and of the Swingline Lender to make any Swingline Loan are
all subject to the further condition precedent that: (a) no Default or
Event of Default shall exist as of the date of the making of such Loan or date
of issuance of such Letter of Credit or would exist immediately after giving
effect thereto; and (b) the representations and warranties made or deemed
made by the Borrower and each other Loan Party in the Loan Documents to which
any of them is a party, shall be true and correct on and as of the date of the
making of such Loan or date of issuance of such Letter of Credit with the same
force and effect as if made on and as of such date except to the extent that
such representations and warranties expressly relate solely to an earlier date
(in which case such representations and warranties shall have been true and
accurate on and as of such earlier date) and except for changes in factual
circumstances specifically and expressly permitted hereunder.  Each Credit Event shall constitute a certification
by the Borrower to the effect set forth in the preceding sentence (both as of
the date of the giving of notice relating to such Credit Event and, unless the
Borrower otherwise notifies the Agent prior to the date of such Credit Event,
as of the date of the occurrence of such Credit Event).  In addition, if such Credit Event is the
making of a Loan or the issuance of a Letter of Credit, the Borrower shall be
deemed to have represented to the Agent and the Lenders at the time such Loan
is made or Letter of Credit issued that all conditions to the occurrence of
such Credit Event contained in Article VI. have
been satisfied.

 

Section 6.3.  Conditions as Covenants.

 

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

 

53

 

ARTICLE VII.  REPRESENTATIONS AND WARRANTIES

 

Section 7.1.  Representations and
Warranties.

 

In order to induce the Agent and each Lender to enter into this
Agreement and to make Loans and issue Letters of Credit, the Parent and the
Borrower represent and warrant to the Agent and each Lender as follows:

 

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

 

(b)           Ownership Structure.  As of the Agreement Date, Part I of Schedule 7.1.(b) is
a complete and correct list of all Subsidiaries of the Parent setting forth for
each such Subsidiary, (i) the jurisdiction of organization of such
Subsidiary, (ii) each Person holding any Equity Interests in such
Subsidiary, (iii) the nature of the Equity Interests held by each such
Person, (iv) the percentage of ownership of such Subsidiary represented by
such Equity Interests and (v) whether such Subsidiary is a Material
Subsidiary and/or an Excluded Subsidiary. Except as disclosed in such Schedule,
as of the Agreement Date (i) each of the Parent and its Subsidiaries owns,
free and clear of all Liens (other than Permitted Liens), and has the
unencumbered right to vote, all outstanding Equity Interests in each Person
shown to be held by it on such Schedule, (ii) all of the issued and
outstanding capital stock of each such Person organized as a corporation is
validly issued, fully paid and nonassessable and (iii) there are no
outstanding subscriptions, options, warrants, commitments, preemptive rights or
agreements of any kind (including, without limitation, any stockholders’ or
voting trust agreements) for the issuance, sale, registration or voting of, or
outstanding securities convertible into, any additional shares of capital stock
of any class, or partnership or other ownership interests of any type in, any
such Person.  As of the Agreement Date Part II
of Schedule 7.1.(b) correctly sets forth all Unconsolidated
Affiliates of the Parent, including the correct legal name of such Person, the
type of legal entity which each such Person is, and all Equity Interests in
such Person held directly or indirectly by the Parent.

 

(c)           Authorization of
Agreement, Etc.  The Borrower has the
right and power, and has taken all necessary action to authorize it, to borrow
and obtain other extensions of credit hereunder.  The Parent, the Borrower and each other Loan
Party has the right and power, and has taken all necessary action to authorize
it, to execute, deliver and perform each of the Loan Documents to which it is a party in accordance with their respective
terms and to consummate the transactions contemplated hereby and thereby.  The Loan Documents to which the Borrower or
any other Loan Party is a party have been duly executed and delivered by the
duly authorized officers of such Person and each is a legal, valid and binding
obligation of such Person enforceable against such Person in accordance with
its respective terms except as the same may

 

54

 

be limited by bankruptcy, insolvency, and other similar laws affecting
the rights of creditors generally and the availability of equitable remedies
for the enforcement of certain obligations (other than the payment of
principal) contained herein or therein and as may be limited by equitable principles
generally.

 

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

 

(e)           Compliance with Law;
Governmental Approvals.  The Parent,
the Borrower, each Subsidiary and each other Loan Party is in compliance with
each Governmental Approval applicable to it and in compliance with all other
Applicable Laws (including without limitation, Environmental Laws) relating to
the Parent, the Borrower, a Subsidiary or such other Loan Party except for
noncompliances which, and Governmental Approvals the failure to possess which,
could not, individually or in the aggregate, reasonably be expected to cause a
Default or Event of Default or have a Material Adverse Effect.

 

(f)            Title to
Properties; Liens.  As of the
Agreement Date, Part I of Schedule 7.1.(f) sets forth all of the
real property owned or leased by the Parent, the Borrower, each other Loan
Party and each other Subsidiary.  Each
such Person has good, marketable and legal title to, or a valid leasehold
interest in, its respective assets.  As
of the Agreement Date, there are no Liens against any assets of the Parent, the
Borrower, any Subsidiary or any other Loan Party except for Permitted Liens.

 

(g)           Existing
Indebtedness.  Schedule 7.1.(g) is,
as of May 31, 2005, a complete and correct listing of all Indebtedness of
the Parent and its Subsidiaries, including without limitation, Guarantees of
the Parent and its Subsidiaries, and indicating whether such Indebtedness is
Secured Indebtedness or Unsecured Indebtedness. 
During the period from such date to the Agreement Date, neither the
Parent nor any Subsidiary has incurred any Indebtedness in excess of
$25,000,000 in aggregate principal amount. 
The Parent and its Subsidiaries have performed and are in compliance
with all of the terms of such Indebtedness and all instruments and agreements
relating thereto, and no default or event of default, or event or condition
which with the giving of notice, the lapse of time, or both, would constitute
such a default or event of default, exists with respect to any such
Indebtedness.

 

(h)           Material Contracts.  Schedule 7.1.(h) is,
as of the Agreement Date, a true, correct and complete listing of all Material
Contracts.  Each of the Parent, its
Subsidiaries and the other Loan Parties that is a party to any Material
Contract has performed and is in compliance with all

 

55

 

of the terms of such Material Contract, and
no default or event of default, or event or condition which with the giving of
notice, the lapse of time, or both, would constitute such a default or event of
default, exists with respect to any such Material Contract.

 

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

 

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

 

(k)           Financial Statements.  The Parent and the Borrower have furnished to
each Lender copies of (i) the audited consolidated balance sheet of the
Parent and its consolidated Subsidiaries for the fiscal year ending December 31,
2004, and the related audited consolidated statements of operations, cash flows
and shareholders’ equity for the fiscal year ending on such dates, with the
opinion thereon of PricewaterhouseCoopers LLP, and (ii) the unaudited
consolidated balance sheet of the Parent and its consolidated Subsidiaries for
the fiscal quarter ending March 31, 2005, and the related unaudited
consolidated statements of operations, cash flows and shareholders’ equity of
the Parent and its consolidated Subsidiaries for the fiscal quarter ending on
such date.  Such financial statements
(including in each case related schedules and notes) are complete and correct
and present fairly, in accordance with GAAP consistently applied throughout the
periods involved, the consolidated financial position of the Parent and its
consolidated Subsidiaries as at their respective dates and the results of
operations and the cash flow for such periods (subject, as to interim
statements, to changes resulting from normal year-end audit adjustments).  Neither the Parent nor any of its
Subsidiaries has on the Agreement Date any material contingent liabilities,
liabilities, liabilities for taxes, unusual or long-term commitments or
unrealized or forward anticipated losses from any unfavorable commitments,
except as referred to or reflected or provided for in said financial
statements.

 

(l)            No Material Adverse
Change.  Since December 31,
2004, there has been no material adverse change in the business, assets,
liabilities, financial condition, results of

 

56

 

operations, business or prospects of the
Parent and its Subsidiaries taken as a whole. 
Each of the Parent, its Subsidiaries and the other Loan Parties is
Solvent.

 

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

 

(n)           Not Plan Assets; No
Prohibited Transaction.  None of the
assets of the Parent, the Borrower, any Subsidiary or any other Loan Party
constitute “plan assets” within the meaning of ERISA, the Internal Revenue Code
and the respective regulations promulgated thereunder.  The execution, delivery and performance of
this Agreement and the other Loan Documents, and the borrowing and repayment of
amounts hereunder, do not and will not constitute “prohibited transactions”
under ERISA or the Internal Revenue Code.

 

(o)           Absence of Defaults.  Neither the Parent, the Borrower, any
Subsidiary nor any other Loan Party is in default under its articles of
incorporation, bylaws, partnership agreement or other similar organizational
documents, and no event has occurred, which has not been remedied, cured or
waived, which, in any such case:  (i) constitutes
a Default or an Event of Default; or (ii) constitutes, or which with the
passage of time, the giving of notice, a determination of materiality, the
satisfaction of any condition, or any combination of the foregoing, would
constitute, a default or event of default by the Parent, the Borrower, any
Subsidiary or any other Loan Party under any agreement (other than this
Agreement) or judgment, decree or order to which the Parent, the Borrower or
any Subsidiary or other Loan Party is a party or by which the Parent, the
Borrower or any Subsidiary or other Loan Party or any of their respective
properties may be bound where such default or event of default could,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.

 

(p)           Environmental Laws.  Each of the Parent, the Borrower, the
Subsidiaries and the other Loan Parties has obtained all Governmental Approvals
which are required under Environmental Laws and is in compliance with all terms
and conditions of such Governmental Approvals which the failure to obtain or to
comply with could reasonably be expected to have a Material Adverse
Effect.  Except for any of the following
matters that could not be reasonably expected to have a Material Adverse
Effect, (i) neither the Parent nor the Borrower is aware of, and has not
received notice of, any past, present, or future events, conditions,
circumstances, activities, practices, incidents, actions, or plans which, with
respect to the Parent or the Borrower, the Subsidiaries and each other Loan
Party, may interfere with or prevent compliance or continued compliance with
Environmental Laws, or may give rise to any common-law or

 

57

 

legal liability, or otherwise form the basis of any claim, action,
demand, suit, proceeding, hearing, study, or investigation, based on or related
to the manufacture, processing, distribution, use, treatment, storage,
disposal, transport, or handling or the emission, discharge, release or
threatened release into the environment, of any pollutant, contaminant,
chemical, or industrial, toxic, or other Hazardous Material; and (ii) there
is no civil, criminal, or administrative action, suit, demand, claim, hearing,
notice, or demand letter, notice of violation, investigation, or proceeding
pending or, to the Parent’s and the Borrower’s knowledge after due inquiry,
threatened, against the Parent, the Borrower, the Subsidiaries and each other
Loan Party relating in any way to Environmental Laws.

 

(q)           Investment Company;
Public Utility Holding Company. 
Neither the Parent nor the Borrower nor any Subsidiary nor any other
Loan Party is (i) an “investment company” or a company “controlled” by an “investment
company” within the meaning of the Investment Company Act of 1940, as amended, (ii) a
“holding company” or a “subsidiary company” of a “holding company”, or an “affiliate”
of a “holding company” or of a “subsidiary company” of a “holding company”,
within the meaning of the Public Utility Holding Company Act of 1935, as
amended, or (iii) subject to any other Applicable Law which purports to
regulate or restrict its ability to borrow money or to consummate the
transactions contemplated by this Agreement or to perform its obligations under
any Loan Document to which it is a party.

 

(r)            Margin Stock.  Neither the Parent nor the Borrower nor any
Subsidiary nor any other Loan Party is engaged principally, or as one of its
important activities, in the business of extending credit for the purpose,
whether immediate, incidental or ultimate, of buying or carrying “margin stock”
within the meaning of Regulation U of the Board of Governors of the
Federal Reserve System.

 

(s)           Affiliate Transactions.  Except as permitted by Section 10.11.,
neither the Parent nor the Borrower nor any Subsidiary nor any other Loan Party
is a party to or bound by any agreement or arrangement (whether oral or
written) to which any Affiliate of the Parent, the Borrower, any Subsidiary or
any other Loan Party is a party.

 

(t)            Intellectual
Property.  Each of the Parent, the
Borrower, each other Loan Party and each other Subsidiary owns or has the right
to use, under valid license agreements or otherwise, all material patents,
licenses, franchises, trademarks, trademark rights, trade names, trade name
rights, trade secrets and copyrights (collectively, “Intellectual Property”)
necessary to the conduct of its businesses as now conducted and as contemplated
by the Loan Documents, without known conflict with any patent, license,
franchise, trademark, trade secret, trade name, copyright, or other proprietary
right of any other Person.  The Parent,
the Borrower, each other Loan Party and each other Subsidiary have taken all
such steps as they deem reasonably necessary to protect their respective rights
under and with respect to such Intellectual Property.  No material claim has been asserted by any
Person with respect to the use of any Intellectual Property by the Parent, the
Borrower, any other Loan Party or any other Subsidiary, or challenging or
questioning the validity or effectiveness of any Intellectual Property.  The use of such Intellectual Property by the
Parent, the Borrower, the Subsidiaries and the other Loan Parties, does not
infringe on the rights of any Person, subject to such claims and infringements
as do not, in the aggregate, give rise to any liabilities on the part of the
Parent, the Borrower, any

 

58

 

other Loan Party or any other Subsidiary
that could reasonably be expected to have a Material Adverse Effect.

 

(u)           Business.  As of the Agreement Date, the Parent and its
Subsidiaries are engaged in the business of owning, managing, leasing,
acquiring and developing suburban office properties located in select
submarkets in the Mid-Atlantic region of the United States of America, together
with other business activities incidental thereto.

 

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

 

(w)          Accuracy and
Completeness of Information.  No
written information, report or other papers or data (excluding financial
projections and other forward looking statements) furnished to the Agent or any
Lender by, on behalf of, or at the direction of, the Parent, the Borrower, any
Subsidiary or any other Loan Party in connection with or relating in any way to
this Agreement, contained any untrue statement of a fact material to the
creditworthiness of the Parent, the Borrower, any Subsidiary or any other Loan
Party or omitted to state a material fact necessary in order to make such
statements contained therein, in light of the circumstances under which they
were made, not misleading.  All financial
statements furnished to the Agent or any Lender by, on behalf of, or at the
direction of, the Parent, the Borrower, any Subsidiary or any other Loan Party
in connection with or relating in any way to this Agreement, present fairly, in
accordance with GAAP consistently applied throughout the periods involved, the
financial position of the Persons involved as at the date thereof and the
results of operations for such periods. 
All financial projections and other forward looking statements prepared
by or on behalf of the Parent, the Borrower, any Subsidiary or any other Loan
Party that have been or may hereafter be made available to the Agent or any
Lender were or will be prepared in good faith based on reasonable
assumptions.  As of the Effective Date,
no fact is known to the Parent or the Borrower which has had, or may in the
future have (so far as the Parent or the Borrower can reasonably foresee), a
Material Adverse Effect which has not been set forth in the financial
statements referred to in Section 7.1.(k) or in
such information, reports or other papers or data or otherwise disclosed in
writing to the Agent and the Lenders.

 

(x)            REIT Status.  The Parent qualifies as a REIT and is in
compliance with all requirements and conditions imposed under the Internal
Revenue Code to allow the Parent to maintain its status as a REIT.

 

(y)           Properties.  As of the Agreement Date, Schedule 7.1.(y) is a correct and complete list of all Properties
included in the calculation of Unencumbered Asset Value.  Each of the assets included by the Borrower
in calculations of Unencumbered Asset Value satisfies all of the requirements
contained in the definitions of “Wholly Owned Property” or “Controlled Property”.  Each of the Properties included in
calculations of the Borrowing Base satisfies all of the requirements contained
in the definitions of (i) ”Wholly Owned Property” or “Controlled Property”
and (ii) ”Eligible Property” to the extent such requirements were not
waived by the

 

59

 

Requisite Lenders pursuant to Section 4.1.(c) at
the time such Property was included in the Borrowing Base.

 

(z)            Foreign Assets
Control.  To the best of the Borrower’s
knowledge after due inquiry, none of the Borrower, any Subsidiary or any
Affiliate of the Borrower: (i) is a Sanctioned Person, (ii) has any
of its assets in Sanctioned Entities, or (iii) derives any of its
operating income from investments in, or transactions with, Sanctioned Persons
or Sanctioned Entities.

 

Section 7.2.  Survival of Representations
and Warranties, Etc.

 

All statements contained in any certificate, financial statement or
other instrument delivered by or on behalf of the Parent, the Borrower, any
Subsidiary or any other Loan Party to the Agent or any Lender pursuant to or in
connection with this Agreement or any of the other Loan Documents (including,
but not limited to, any such statement made in or in connection with any
amendment thereto or any statement contained in any certificate, financial
statement or other instrument delivered by or on behalf of the Parent or the
Borrower prior to the Agreement Date and delivered to the Agent or any Lender
in connection with the underwriting or closing of the transactions contemplated
hereby) shall constitute representations and warranties made by the Borrower
and the Parent in favor of the Agent or any of the Lenders under this
Agreement.  All representations and
warranties made under this Agreement and the other Loan Documents shall be
deemed to be made at and as of the Agreement Date, the Effective Date, the date on which any extension of the Termination Date is
effectuated pursuant to Section 2.12. and the
date of the occurrence of any Credit Event, except to the extent that such
representations and warranties expressly relate solely to an earlier date (in
which case such representations and warranties shall have been true and
accurate on and as of such earlier date) and except for changes in factual
circumstances not prohibited hereunder. 
All such representations and warranties shall survive the effectiveness
of this Agreement, the execution and delivery of the Loan Documents and the
making of the Loans and the issuance of the Letters of Credit.

 

ARTICLE VIII.  AFFIRMATIVE COVENANTS

 

For so long as this Agreement is in effect, unless the Requisite
Lenders (or, if required pursuant to Section 13.6., all of the Lenders)
shall otherwise consent in the manner provided for in Section 13.6., the
Parent and the Borrower shall comply with the following covenants:

 

Section 8.1.  Preservation of Existence
and Similar Matters.

 

Except as otherwise permitted under Section 10.7., the Parent and
the Borrower shall, and shall cause each Subsidiary and each other Loan Party
to, preserve and maintain its respective existence, rights, franchises,
licenses and privileges in the jurisdiction of its incorporation or formation
and qualify and remain qualified and authorized to do business in each
jurisdiction in which the character of its properties or the nature of its
business requires such qualification and authorization and where the failure to
be so authorized and qualified could reasonably be expected to have a Material
Adverse Effect.

 

60

 

Section 8.2.  Compliance with Applicable
Law and Material Contracts.

 

The Parent and the Borrower shall, and shall cause each Subsidiary and
each other Loan Party to, comply with (a) all Applicable Laws, including
the obtaining of all Governmental Approvals, the failure with which to comply
could reasonably be expected to have a Material Adverse Effect, and (b) all
terms and conditions of all Material Contracts to which it is a party.

 

Section 8.3.  Maintenance of Property.

 

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

 

Section 8.4.  Conduct of Business.

 

The Parent and the Borrower shall, and shall cause their Subsidiaries
and the other Loan Parties to carry on, their respective businesses as
described in Section 7.1.(u).

 

Section 8.5.  Insurance.

 

In addition to the requirements of any of the other Loan Documents, the
Parent and the Borrower shall, and shall cause each Subsidiary and other Loan
Party to, maintain insurance (on a replacement cost basis) with financially
sound and reputable insurance companies against such risks and in such amounts
as is customarily maintained by Persons engaged in similar businesses or as may
be required by Applicable Law, and from time to time deliver to the Agent upon
its request a detailed list, together with copies of all policies of the
insurance then in effect, stating the names of the insurance companies, the
amounts and rates of the insurance, the dates of the expiration thereof and the
properties and risks covered thereby.

 

Section 8.6.  Payment of Taxes and
Claims.

 

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

 

61

 

Section 8.7.  Visits and Inspections.

 

The Parent and the Borrower shall, and shall cause each Subsidiary and
other Loan Party to, permit representatives or agents of any Lender or the
Agent, from time to time after reasonable prior notice if no Event of Default
shall be in existence, as often as may be reasonably requested, but only during
normal business hours and at the expense of such Lender or the Agent (unless a
Default or Event of Default shall exist, in which case the exercise by the
Agent or such Lender of its rights under this Section shall be at the
expense of the Borrower), as the case may be, to: (a) visit and inspect
all properties of the Parent, the Borrower or such Subsidiary or other Loan
Party to the extent any such right to visit or inspect is within the control of
such Person; (b) inspect and make extracts from their respective books and
records, including but not limited to management letters prepared by
independent accountants; and (c) discuss with its officers and employees,
and its independent accountants, its business, properties, condition (financial
or otherwise), results of operations and performance.  If requested by the Agent, the Parent shall
execute an authorization letter addressed to its accountants authorizing the
Agent or any Lender to discuss the financial affairs of the Parent and any
Subsidiary or any other Loan Party with its accountants.

 

Section 8.8.  Use of Proceeds; Letters of
Credit.

 

The Borrower shall use the proceeds of the Loans and the Letters of
Credit for general corporate purposes only. 
No part of the proceeds of any Loan or Letter of Credit will be used (a) for
the purpose of buying or carrying “margin stock” within the meaning of
Regulation U of the Board of Governors of the Federal Reserve System or to
extend credit to others for the purpose of purchasing or carrying any such
margin stock or (b) to fund any operations in, finance any investments or
activities in, or make any payments to, a Sanctioned Person or Sanctioned
Entity.

 

Section 8.9.  Environmental Matters.

 

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

 

62

 

Section 8.10.  Books and Records.

 

The Parent shall, and shall cause each of its Subsidiaries and the
other Loan Parties to, maintain books and records pertaining to its respective
business operations in such detail, form and scope as
is consistent with good business practice and in accordance with GAAP.

 

Section 8.11.  Further Assurances.

 

The Parent and the Borrower shall, at the Borrower’s cost and expense
and upon request of the Agent, execute and deliver or cause to be executed and
delivered, to the Agent such further instruments, documents and certificates,
and do and cause to be done such further acts that may be reasonably necessary
or advisable in the reasonable opinion of the Agent to carry out more
effectively the provisions and purposes of this Agreement and the other Loan
Documents.

 

Section 8.12.  New
Subsidiaries/Guarantors.

 

(a)           Requirement to
Become Guarantor.  Within 30 days of
any Person (other than an Excluded Subsidiary) becoming a Material Subsidiary
after the Effective Date, the Borrower shall deliver to the Agent an Accession
Agreement executed by such Material Subsidiary; provided, however, promptly
(and in any event within 30 days) upon any Excluded Subsidiary ceasing to be
subject to the restriction which prevented it from becoming a Guarantor on the
Effective Date or delivering an Accession Agreement pursuant to this Section,
as the case may be, such Subsidiary shall comply with the provisions of this
Section.  The Borrower shall send each
Lender a copy of such Accession Agreement.

 

(b)           Other Guarantors.  The Borrower may, at its option, cause any
Subsidiary that is not already a Guarantor to become a Guarantor by executing
and delivering to the Agent the items required to be delivered under the
immediately preceding subsection (a).

 

(c)           Release of a
Guarantor.  The Borrower may request
in writing that the Agent release, and upon receipt of such request the Agent
shall release, a Guarantor from the Guaranty so long as: (i) such
Guarantor (x) meets, or will meet simultaneously with its release from the
Guaranty, all of the provisions of the definition of the term “Excluded
Subsidiary” or (y) has ceased to be, or simultaneously with its release
from the Guaranty will cease to be, a Material Subsidiary; (ii) no Default
or Event of Default shall then be in existence or would occur as a result of
such release, including without limitation, a Default or Event of Default
resulting from a violation of any of the covenants contained in Section 10.1.;
and (iii) the Agent shall have received such written request at least 10
Business Days prior to the requested date of release.  Delivery by the Borrower to the Agent of any
such request shall constitute a representation by the Borrower that the matters
set forth in the preceding sentence (both as of the date of the giving of such
request and as of the date of the effectiveness of such request) are true and
correct with respect to such request.

 

Section 8.13.  REIT Status.

 

The Parent shall at all times maintain its status as a REIT.

 

63

 

Section 8.14.  Exchange Listing.

 

The Parent shall maintain at least one class of common shares of the
Parent having trading privileges on the New York Stock Exchange or the American
Stock Exchange or which is the subject of price quotations in the over-the-counter
market as reported by the National Association of Securities Dealers Automated
Quotation System.

 

ARTICLE IX.
INFORMATION

 

For so long as this Agreement is in effect, unless the Requisite
Lenders (or, if required pursuant to Section 13.6., all of the Lenders)
shall otherwise consent in the manner set forth in Section 13.6., the
Borrower and the Parent shall furnish to each Lender (or to the Agent if so
provided below) at its Lending Office:

 

Section 9.1.  Quarterly Financial
Statements.

 

As soon as available and in any event within 10 days after the same is
required to be filed with the Securities and Exchange Commission (but in no
event later than 55 days after the end of each of the first, second and third
fiscal quarters of the Parent), the unaudited consolidated balance sheet of the
Parent and its Subsidiaries as at the end of such period and the related unaudited
consolidated statements of income, shareholders’ equity and cash flows of the
Parent and its Subsidiaries for such period, setting forth in each case in
comparative form the figures as of the end of and for the corresponding periods
of the previous fiscal year, all of which shall be certified by the chief
financial officer or chief accounting officer of the Parent, in his or her
opinion, to present fairly, in accordance with GAAP and in all material
respects, the consolidated financial position of the Parent and its
Subsidiaries as at the date thereof and the results of operations for such
period (subject to normal year-end audit adjustments).

 

Section 9.2.  Year-End Statements.

 

As soon as available and in any event within 10 days after the same is
required to be filed with the Securities and Exchange Commission (but in no
event later than 100 days after the end of each fiscal year of the Parent), the
audited consolidated balance sheet of the Parent and its Subsidiaries as at the
end of such fiscal year and the related audited consolidated statements of
income, shareholders’ equity and cash flows of the Parent and its Subsidiaries
for such fiscal year, setting forth in comparative form the figures as at the
end of and for the previous fiscal year, all of which shall be certified by (a) the
chief financial officer or chief accounting officer of the Parent, in his or
her opinion, to present fairly, in accordance with GAAP, the consolidated
financial position of the Parent and its Subsidiaries as at the date thereof
and the results of operations for such period and (b) independent
certified public accountants of recognized national standing acceptable to the
Agent, whose certificate shall be unqualified and in scope and substance
satisfactory to the Requisite Lenders.

 

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Section 9.3.  Compliance Certificate.

 

At the time financial statements are furnished pursuant to
Sections 9.1. and 9.2., and within 5 Business Days of the Agent’s request
with respect to any other fiscal period, a certificate substantially in the
form of Exhibit J (a “Compliance Certificate”) executed by the chief
financial officer of each of the Parent and the Borrower: (a) setting
forth in reasonable detail as at the end of such quarterly accounting period,
fiscal year, or other fiscal period, as the case may be, the calculations
required to establish whether or not the Parent and the Borrower were in
compliance with the covenants contained in Sections 10.1., 10.2. and 10.4. and (b) stating that, to the best of such
Person’s knowledge, information and belief after due inquiry, no Default or
Event of Default exists, or, if such is not the case, specifying such Default
or Event of Default and its nature, when it occurred, whether it is continuing and
the steps being taken by the Borrower with respect to such event, condition or
failure.  Together with each Compliance
Certificate delivered in connection with quarterly or annual financial
statements, the Borrower and the Parent shall deliver (a) a report, in
form and detail reasonably satisfactory to the Agent, setting forth a Statement
of Funds From Operations for the fiscal period then ending and (b) if any
Properties have been included in calculations of the Borrowing Base pursuant to
the provisions of Section 4.1.(e) since delivery of the last
Compliance Certificate, each of the items set forth in clauses (i) through
(v) of Section 4.1.(b) with respect to each such Property.

 

Section 9.4.  Other Information.

 

(a)           Management Reports.  Promptly upon receipt thereof, copies of all
management reports, if any, submitted to the Parent or its respective Boards of
Trustees by its independent public accountants;

 

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

 

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

 

(d)           ERISA.  If and when any member of the ERISA Group (i) gives
or is required to give notice to the PBGC of any “reportable event” (as defined
in Section 4043 of ERISA) with respect to any Plan which might constitute
grounds for a termination of such Plan under Title IV of ERISA, or knows that
the plan administrator of any Plan has given or is required to give notice of
any such reportable event, a copy of the notice of such reportable event given
or required to be given to the PBGC; (ii) receives notice of complete or
partial withdrawal liability under Title IV of ERISA or notice that any
Multiemployer Plan is in reorganization, is insolvent or has been terminated, a
copy of such notice; (iii) receives notice from the PBGC under Title IV

 

65

 

of ERISA of an intent to terminate, impose liability (other than for
premiums under Section 4007 of ERISA) in respect of, or appoint a trustee
to administer any Plan, a copy of such notice; (iv) applies for a waiver
of the minimum funding standard under Section 412 of the Internal Revenue
Code, a copy of such application; (v) gives notice of intent to terminate
any Plan under Section 4041(c) of ERISA, a copy of such notice and
other information filed with the PBGC; (vi) gives notice of withdrawal
from any Plan pursuant to Section 4063 of ERISA, a copy of such notice; or
(vii) fails to make any payment or contribution to any Plan or
Multiemployer Plan or in respect of any Benefit Arrangement or makes any
amendment to any Plan or Benefit Arrangement which has resulted or could result
in the imposition of a Lien or the posting of a bond or other security, a
certificate of the chief financial officer of the Borrower or the Parent, as applicable,
setting forth details as to such occurrence and the action, if any, which the
Parent, the Borrower or applicable member of the ERISA Group is required or
proposes to take;

 

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

 

(f)            Modification of
Organizational Documents.  A copy of
all amendments to the articles of incorporation, bylaws, partnership agreement,
operating agreement or other similar organizational documents of the Parent,
the Borrower or any other Loan Party adopted during any fiscal quarter within
30 Business Days after the end of such fiscal quarter;

 

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

 

(h)           Default. Notice
of the occurrence of any of the following promptly upon a Responsible Officer
of the Parent or the Borrower obtaining knowledge thereof: (i) any Default
or Event of Default or (ii) any event which constitutes or which with the
passage of time, the giving of notice, or otherwise, would constitute a default
or event of default by the Parent, the Borrower, any Subsidiary or any other
Loan Party under any Material Contract to which any such Person is a party or
by which any such Person or any of its respective properties may be bound;

 

(i)            Judgments.  Prompt notice of any order, judgment or
decree in excess of $1,000,000 having been entered against the Parent, the
Borrower, any Subsidiary or any other Loan Party of any of their respective
properties or assets;

 

66

 

(j)            Notice of
Violations of Law.  Prompt notice if
the Parent, the Borrower, any Subsidiary or any other Loan Party shall receive
any notification from any Governmental Authority alleging a violation of any
Applicable Law or any inquiry which, in either case, could reasonably be
expected to have a Material Adverse Effect;

 

(k)           Material Subsidiary.  Prompt notice of any Person becoming a
Material Subsidiary;

 

(l)            Material Asset
Sales.  Prompt notice of the sale,
transfer or other disposition of, in one or a series of related transactions,
assets constituting 10% or more of the Total Asset Value to any Person other
than the Parent, the Borrower, any Subsidiary or any other Loan Party;

 

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

 

(n)           Borrowing Base
Certificate. At the time the financial statements are furnished pursuant to
Sections 9.1. and 9.2., or within 5 Business Days of request by the Agent, a
Borrowing Base Certificate setting forth the information to be contained
therein, as of the last day of such fiscal quarter.  The Borrower shall also deliver a Borrowing
Base Certificate as required pursuant to Section 4.2.(b);

 

(o)           Rent Roll and
Operating Summary.  At the time the
financial statements are furnished pursuant to Sections 9.1. and 9.2., or
within 5 Business Days of request by the Agent, an operating summary with
respect to each Borrowing Base Property, including without limitation, a
quarterly and year-to-date statement of Net Operating Income and a leasing/occupancy
status report together with a current rent roll for such Property;

 

(p)           Patriot Act
Information.  From time to time and
promptly upon each request, information identifying the Borrower as a Lender
may request in order to comply with the USA Patriot Act (Title III of Pub. L.
107-56 (signed into law October 26, 2001)); and

 

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

 

ARTICLE X. NEGATIVE COVENANTS

 

For so long as this Agreement is in effect, unless the Requisite
Lenders (or, if required pursuant to Section 13.6., all of the Lenders)
shall otherwise consent in the manner set forth in Section 13.6., the
Borrower and the Parent shall comply with the following covenants:

 

67

 

Section 10.1.  Financial Covenants.

 

Neither the Parent nor the Borrower shall permit:

 

(a)           Maximum Leverage
Ratio.  The ratio
of (i) Total Indebtedness to (ii) Total Asset Value, to exceed 0.65
to 1.0 at any time.

 

(b)           Minimum Fixed Charge
Coverage Ratio.  The ratio of (i) Adjusted
EBITDA of the Parent and its Subsidiaries determined on a consolidated basis
for the fiscal quarter of the Parent most recently ending to (ii) Fixed
Charges for such period, to be less than 1.40 to 1.00 at any time.

 

(c)           Minimum Debt Service
Ratio.  The ratio of (i) Adjusted
EBITDA of the Parent and its Subsidiaries determined on a consolidated basis
for the fiscal quarter of the Parent most recently ending to (ii) Debt
Service for such period, to be less than 1.75 to 1.00 any time.

 

(d)           Maximum Secured
Indebtedness Ratio.  The ratio of (i) Secured
Indebtedness of the Parent and its Subsidiaries determined on a consolidated
basis to (ii) Total Asset Value, to be greater than 0.55 to 1.00 at any
time. In addition, neither the Parent nor the Borrower will permit the ratio of
(x) Secured Indebtedness (other than Nonrecourse Indebtedness) of the
Parent, the Borrower and the other Guarantors to (y) Total Asset Value, to
be greater than 0.15 to 1.00 at any time.

 

(e)           Unencumbered
Leverage Ratio.  The
ratio of (i) Unsecured Indebtedness of the Parent and its Subsidiaries to (ii) Unencumbered
Asset Value, to be greater than 0.65 to 1.00 at any time.

 

(f)            Minimum
Unencumbered Interest Coverage Ratio. 
The ratio of (i) Unencumbered Adjusted NOI for
the fiscal quarter of the Parent most recently ending to (ii) Unsecured
Interest Expense for such period, to be less than 1.75 to 1.00 at any time.

 

(g)           Minimum Net Worth.  Tangible Net Worth at any time to be less
than (i) $400,000,000 plus (ii) 75% of the Net Proceeds of all
Equity Issuances effected by the Parent or any Subsidiary after the Effective
Date.

 

(h)           Loan to Value Ratio.  The
ratio of (x) the principal amount of Secured Recourse Indebtedness secured
by a Lien on a Stabilized Property to (y) the Value of such Stabilized
Property to exceed 0.75 to 1.00 at any time. 
In addition, neither the Parent nor the Borrower will permit ratio of (A) the
principal amount of Secured Recourse Indebtedness secured by a Lien on a
Development Property to (B) the value (based on cost determined in
accordance with GAAP) of such Development
Property to exceed 0.90 to 1.00 at any time.

 

(i)            Floating Rate Indebtedness.  The
ratio of (i) Floating Rate Indebtedness of the Parent and its Subsidiaries
determined on a consolidated basis, together with the Parent’s pro rata share
of Floating Rate Debt of Unconsolidated Affiliates which is recourse to the
Parent or any Subsidiary, to (ii) Total Indebtedness, to exceed 0.35 to
1.00 at any time.

 

68

 

(j)            Assets Owned by Borrower and Guarantors.  The amount of Adjusted Total Asset Value attributable to assets
directly owned by the Borrower and the Guarantors to be less than 95.0% of
Adjusted Total Asset Value.

 

(k)           Borrowing Base Property Occupancy Rate.  The
aggregate weighted average Occupancy Rate of the Borrowing Base Properties
(excluding (i) Development Properties and (ii) Properties which are
vacant due to the expiration of the lease of a tenant which leased the entire
Property, provided, that a Property shall not be excluded pursuant to this
clause (ii) for a period of more than 6 months) to be less than 85%.

 

(l)            Minimum Value of Borrowing Base Properties.  The
aggregate Borrowing Base Values of the Borrowing Base Properties to be less
than $400,000,000 at any time (provided, that, solely for purposes of this Section 10.1.(l),
the Borrowing Base Values of the Borrowing Base Properties shall not be subject
to the 65% limitation set forth in the definition of “Borrowing Base Value”).

 

Section 10.2.  Restricted Payments.

 

The Parent and the Borrower shall not, and shall not permit any
Subsidiary to, declare or make any Restricted Payment; provided, however, that
the Parent, the Borrower and any Subsidiary may declare and make the following
Restricted Payments so long as no Default or Event of Default would result
therefrom:

 

(a)           the Parent may declare
or make cash distributions to its shareholders during the period of four
consecutive fiscal quarters most recently ending in an aggregate amount not to
exceed the greater of (i) 95% of Funds From Operations of the Parent for
such period or (ii) the amount required to be distributed for the Parent
to remain in compliance with Section 8.13.;

 

(b)           the Parent may make
cash distributions to its shareholders of capital gains resulting from gains
from certain asset sales to the extent necessary to avoid payment of taxes on
such asset sales imposed under Sections 857(b)(3) and 4981 of the
Internal Revenue Code;

 

(c)           the Borrower or any Subsidiary may acquire the Equity
Interests of a Subsidiary that is not a Wholly Owned Subsidiary;

 

(d)           a
Subsidiary that is not a Wholly Owned Subsidiary may make cash distributions to
holders of Equity Interests issued by such Subsidiary;

 

(e)           Subsidiaries may pay
Restricted Payments to the Parent, the Borrower or any Subsidiary;

 

(f)            the
Parent may repurchase outstanding Equity Interests of the Parent in an amount
not to exceed $50,000,000 in the aggregate during the term of this Agreement;
and

 

(g)           the
Parent may redeem Equity Interests consisting of Preferred Stock of the Parent
through the issuance of Equity Interests of the Parent.

 

69

 

Notwithstanding the foregoing, but subject to the following sentence,
if a Default or Event of Default exists, the Parent may only declare or make
cash distributions to its shareholders during any fiscal year in an aggregate
amount not to exceed the minimum amount necessary for the Parent to remain in
compliance with Section 8.13.  If a
Default or Event of Default specified in Section 11.1.(f) or
Section 11.1.(g) shall exist, or if as a result of the occurrence of
any other Event of Default any of the Obligations have been accelerated
pursuant to Section 11.2.(a), the Parent shall not, and shall not permit
any Subsidiary to, make any Restricted Payments to any Person other than to the
Parent or any Guarantor.

 

Section 10.3.  Indebtedness.

 

The Parent and the Borrower shall not, and shall not permit any
Subsidiary or any other Loan Party to, incur, assume, or otherwise become
obligated in respect of any Indebtedness after the Agreement Date if
immediately prior to the assumption, incurring or becoming obligated in respect
thereof, or immediately thereafter and after giving effect thereto, a Default
or Event of Default is or would be in existence, including without limitation,
a Default or Event of Default resulting from a violation of any of the
covenants contained in Section 10.1.

 

Section 10.4. Certain
Permitted Investments.

 

The Parent and the Borrower shall not, and shall not permit any
Subsidiary to, make any Investment in or otherwise own the following items
which would cause the aggregate value of such holdings of the Parent, the
Borrower and such other Subsidiaries to exceed the applicable limits set forth
below:

 

(a)           Investments in
Unconsolidated Affiliates and other Persons that are not Subsidiaries, such
that the aggregate value of such Investments (determined in a manner consistent
with the definition of Total Asset Value or, if not contemplated under the
definition of Total Asset Value, as determined in accordance with GAAP) exceeds
20% of Total Asset Value at any time;

 

(b)           raw
land, such that the current book value of all raw land exceeds 10% of Total
Asset Value.

 

(c)           real property under
construction (other than real property which is at least 80% pre-leased) such
that the aggregate Construction Budget for all such real property exceeds 15%
of Total Asset Value at any time; and

 

(d)           Properties leased under
ground leases by the Parent, the Borrower or any Subsidiary, as lessee, such
that the current value (determined in accordance with the applicable provisions
of the term “Total Asset Value”) of such Properties exceeds 10.0% of Total
Asset Value at any time.

 

In addition to the foregoing limitations, the aggregate value of all of
the items subject to the limitations in the preceding clauses (a) through
(d), without duplication, shall not exceed 35% of Total Asset Value at any
time.

 

70

 

Section 10.5.  Investments Generally.

 

The Parent and the Borrower shall not, and shall not permit any
Subsidiary or other Loan Party to, directly or indirectly, acquire, make or
purchase any Investment, or permit any Investment of such Person to be
outstanding on and after the Agreement Date, other than the following:

 

(a)           Investments in
Subsidiaries in existence on the Agreement Date and disclosed on Part I of
Schedule 7.1.(b);

 

(b)           Investments to acquire
Equity Interests of a Subsidiary or any other Person who after giving effect to
such acquisition would be a Subsidiary, so long as in each case (i) immediately
prior to such Investment, and after giving effect thereto, no Default or Event
of Default is or would be in existence and (ii) if such Subsidiary is (or
after giving effect to such Investment would become) a Material Subsidiary, and
is not an Excluded Subsidiary, the terms and conditions set forth in Section 8.12.
are satisfied;

 

(c)           Investments permitted
under Section 10.4.;

 

(d)           Investments in Cash
Equivalents;

 

(e)           intercompany
Indebtedness among the Borrower and its Wholly Owned Subsidiaries provided that
such Indebtedness is permitted by the terms of Section 10.3.;

 

(f)            loans
and advances to officers and employees for moving, entertainment, travel and
other similar expenses in the ordinary course of business consistent with past
practices; and

 

(g)           any
other Investment so long as immediately prior to making such Investment, and
immediately thereafter and after giving effect thereto, no Default or Event of
Default is or would be in existence.

 

Section 10.6.  Liens; Negative Pledges;
Other Matters.

 

(a)           The Parent and the
Borrower shall not, and shall not permit any Subsidiary or other Loan Party to,
create, assume, or incur any Lien (other than Permitted Liens) upon any of its
properties, assets, income or profits of any character whether now owned or
hereafter acquired if immediately prior to the creation, assumption or
incurring of such Lien, or immediately thereafter, a Default or Event of
Default is or would be in existence, including without limitation, a Default or
Event of Default resulting from a violation of any of the covenants contained
in Section 10.1.

 

(b)           The Parent and the
Borrower shall not, and shall not permit any Subsidiary or other Loan Party to,
enter into, assume or otherwise be bound by any Negative Pledge on any
Borrowing Base Property.

 

(c)           The Parent and the
Borrower shall not, and shall not permit any Subsidiary or other Loan Party to,
create or otherwise cause or suffer to exist or become effective any

 

71

 

consensual encumbrance or restriction of any kind on the ability of any
Subsidiary (other than an Excluded Subsidiary) to: (i) pay dividends or
make any other distribution on any of such Subsidiary’s capital stock or other
equity interests owned by the Parent or any Subsidiary; (ii) pay any
Indebtedness owed to the Parent or any Subsidiary; (iii) make loans or
advances to the Parent or any Subsidiary; or (iv) transfer any of its
property or assets to the Parent or any Subsidiary.

 

Section 10.7.  Merger, Consolidation,
Sales of Assets and Other Arrangements.

 

The Parent and the Borrower shall not, and shall not permit any
Subsidiary or other Loan Party to: (i) enter into any transaction of
merger or consolidation; (ii) liquidate, wind up or dissolve itself (or
suffer any liquidation or dissolution); or (iii) convey, sell, lease,
sublease, transfer or otherwise dispose of, in one transaction or a series of
transactions, all or any substantial part of its business or assets, whether
now owned or hereafter acquired; provided, however, that:

 

(a)           any of the actions
described in the immediately preceding clauses (i) through (iii) may
be taken with respect to any Subsidiary or any other Loan Party (other than the
Parent or the Borrower) so long as immediately prior to the taking of such
action, and immediately thereafter and after giving effect thereto, no Default
or Event of Default is or would be in existence; notwithstanding the foregoing,
any such Loan Party (other than the Borrower) may enter into a transaction of
merger pursuant to which such Loan Party is not the survivor of such merger
only if (i) the Borrower shall have given the Agent and the Lenders at
least 30 Business Days’ prior written notice of such merger, such notice to include a certification to the
effect that immediately after and after giving effect to such action, no
Default or Event of Default is or would be in existence; (ii) within 5
Business Days of consummation of such merger, the survivor entity (if not
already a Guarantor) shall have executed and delivered an assumption agreement
in form and substance satisfactory to the Agent pursuant to which such survivor
entity shall expressly assume all of the such Loan Party’s Obligations under
the Loan Documents to which it is a party; (iii) within 30 days of
consummation of such merger, the survivor entity delivers to the Agent the
following: (A) items of the type referred to in Sections 6.1.(a)(iv),
(v), (ix) through (xii) and (xvi) 
with respect to the survivor entity as in effect after consummation of
such merger (if not previously delivered to the Agent and still in effect), (B) copies
of all documents entered into by such Loan Party or the survivor entity to
effectuate the consummation of such merger, including, but not limited to,
articles of merger and the plan of merger, (C) copies, certified by the
Secretary or Assistant Secretary (or other individual performing similar
functions) of such Loan Party or the survivor entity, of all corporate and
shareholder action authorizing such merger and (D) copies of any filings
with the Securities and Exchange Commission in connection with such merger; and
(iv) such Loan Party and the survivor entity each takes such other action
and delivers such other documents, instruments, opinions and agreements as the
Agent may reasonably request;

 

(b)           the Parent, the
Borrower, the Subsidiaries and the other Loan Parties may lease and sublease
their respective assets, as lessor or sublessor (as the case may be), in the
ordinary course of their business;

 

72

 

(c)           a Person may merge with
and into the Borrower or the Parent so long as (i) the Borrower or the
Parent, as the case may be, is the survivor of such merger, (ii) immediately
prior to such merger, and immediately thereafter and after giving effect
thereto, no Default or Event of Default is or would be in existence, (iii) the
Borrower shall have given the Agent and the Lenders at least 30 Business Days’
prior written notice of such merger, such
notice to include a certification as to the matters described in the
immediately preceding clause (ii) (except that in the case of
the merger of a Subsidiary with and into the Borrower or the Parent such notice
may be given no later 5 Business Days following the consummation of such
merger);

 

(d)           the Parent, the
Borrower and each Subsidiary may sell, transfer or dispose of assets among
themselves; provided, however, no Borrowing Base Property shall be transferred
to any Guarantor unless the Agent has previously received the items that would
have been required to be delivered under Sections 6.1.(a)(iv),
(v), (ix) through (xii) and (xvi) with respect to such Guarantor had such
Guarantor been a Guarantor on the Effective Date.

 

Section 10.8.  Fiscal Year.

 

Neither the Parent nor the Borrower shall change its fiscal year from
that in effect as of the Agreement Date.

 

Section 10.9.  Modifications to Material
Contracts.

 

The Parent and the Borrower shall not, and shall not permit any
Subsidiary or other Loan Party to, enter into any amendment or modification to
any Material Contract which could reasonably be expected to have a Material
Adverse Effect.

 

Section 10.10.  Modifications of
Organizational Documents.

 

The Parent and the Borrower shall not, and shall not permit any Loan
Party or other Subsidiary to, amend, supplement, restate or otherwise modify
its articles or certificate of incorporation, by-laws, operating agreement,
declaration of trust, partnership agreement or other applicable organizational
document if such amendment, supplement, restatement or other modification could
reasonably be expected to have a Material Adverse Effect.

 

Section 10.11.  Transactions with
Affiliates.

 

The Parent and the Borrower shall not, and shall not permit any
Subsidiary or any other Loan Party to, permit to exist or enter into, any
transaction (including the purchase, sale, lease or exchange of any property or
the rendering of any service) with any Affiliate, except transactions in the
ordinary course of and pursuant to the reasonable requirements of the business
of the Parent or any of its Subsidiaries and upon fair and reasonable terms which
are no less favorable to the Parent or such Subsidiary than would be obtained
in a comparable arm’s length transaction with a Person that is not an
Affiliate.

 

73

 

Section 10.12.  ERISA Exemptions.

 

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

 

ARTICLE XI. DEFAULT

 

Section 11.1.  Events of Default.

 

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

 

(a)           Default in Payment
of Principal.  The Borrower shall
fail to pay when due (whether upon demand, at maturity, by reason of
acceleration or otherwise) the principal of any of the Loans, or any
Reimbursement Obligation.

 

(b)           Default in Payment
of Interest and Other Obligations. 
The Borrower shall fail to pay when due any interest on any of the Loans
or any of the other payment Obligations owing by the Borrower under this
Agreement or any other Loan Document, or any other Loan Party shall fail to pay
when due any payment Obligation owing by such other Loan Party under any Loan
Document to which it is a party, and such failure shall continue for a period
of 5 Business Days.

 

(c)           Default
in Performance.  (i) The Parent
or the Borrower shall fail to perform or observe any term, covenant, condition
or agreement contained in Section 9.4.(h) or in Article X. or (ii) the
Borrower or any other Loan Party shall fail to perform or observe any term,
covenant, condition or agreement contained in this Agreement or any other Loan
Document to which it is a party and not otherwise mentioned in this Section and
in the case of this clause (ii) only such failure shall continue for
a period of 30 days after the earlier of (x) the date upon which a
Responsible Officer of the Borrower or such Loan Party obtains knowledge of
such failure or (y) the date upon which the Borrower has received written
notice of such failure from the Agent.

 

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

 

(e)           Indebtedness Cross-Default;
Derivatives Contracts.

 

(i)            The
Parent, the Borrower or any Subsidiary or any other Loan Party shall fail to
pay when due and payable the principal of, or interest on, any Indebtedness
(other than the Loans) having an aggregate outstanding principal amount of
$20,000,000 or

 

74

 

more (or
$50,000,000 or more in the case of Nonrecourse Indebtedness) (“Material
Indebtedness”); or

 

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

 

(iii)          any
other event shall have occurred and be continuing which, with or without the
passage of time, the giving of notice, or both, would permit any holder or
holders of Material Indebtedness, any trustee or agent acting on behalf of such
holder or holders or any other Person, to accelerate the maturity of any such
Material Indebtedness or require any such Material Indebtedness to be prepaid
or repurchased prior to its stated maturity; or

 

(iv)          there
occurs under any Derivatives Contract an Early Termination Date (as defined in
such Derivatives Contract) resulting from (A) any event of default under
such Derivatives Contract as to which any Loan Party is the Defaulting Party
(as defined in such Derivatives Contract) or (B) any Termination Event (as
so defined) under such Derivatives Contract as to which any Loan Party is an
Affected Party (as so defined) and, in either event, the Derivatives
Termination Value owed by any Loan Party as a result thereof is $20,000,000 or
more.

 

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

 

(g)           Involuntary
Bankruptcy Proceeding.  A case or
other proceeding shall be commenced against the Parent, the Borrower, any other
Loan Party or any Material Subsidiary of the Parent or the Borrower in any
court of competent jurisdiction seeking: 
(i) relief under the Bankruptcy Code of 1978, as amended, or other
federal bankruptcy laws (as now or hereafter in effect) or under any other Applicable
Laws, domestic or foreign, relating to bankruptcy, insolvency, reorganization,
winding-up, or composition or adjustment of debts; or (ii) the appointment
of a trustee, receiver, custodian, liquidator or the like of such Person, or of
all or

 

75

 

any substantial part of the assets, domestic or foreign, of such
Person, and such case or proceeding shall continue undismissed or unstayed for
a period of 60 consecutive calendar days, or an order granting the remedy
or other relief requested in such case or proceeding against the Parent, the
Borrower, such Subsidiary or such other Loan Party (including, but not limited
to, an order for relief under such Bankruptcy Code or such other federal
bankruptcy laws) shall be entered.

 

(h)           Litigation;
Enforceability.  The Parent, the
Borrower, any Subsidiary or any other Loan Party shall disavow, revoke or
terminate (or attempt to terminate) any Loan Document to which it is a party or
shall otherwise challenge or contest in any action, suit or proceeding in any
court or before any Governmental Authority the validity or enforceability of
this Agreement, any Note or any other Loan Document or this Agreement, any
Note, the Guaranty or any other Loan Document shall cease to be in full force
and effect (except as a result of the express terms thereof).

 

(i)            Judgment.  A judgment or order for the payment of money
or for an injunction shall be entered against the Parent, the Borrower, any
Subsidiary or any other Loan Party, by any court or other tribunal and (i) such
judgment or order shall continue for a period of 30 days without being paid,
stayed or dismissed through appropriate appellate proceedings and (ii) either
(A) the amount of such judgment or order for which insurance has not been
acknowledged in writing by the applicable insurance carrier (or the amount as
to which the insurer has denied liability) exceeds, individually or together
with all other such outstanding judgments or orders $20,000,000 (or $50,000,000
in the case of any Subsidiary that is not a Loan Party) or (y) (B) in the
case of an injunction or other non-monetary judgment, such judgment could
reasonably be expected to have a Material Adverse Effect.

 

(j)            Attachment.  A warrant, writ of attachment, execution or
similar process shall be issued against any property of the Parent, the
Borrower, any Subsidiary of the Parent or the Borrower or any other Loan Party
which exceeds, individually or together with all other such warrants, writs,
executions and processes, $20,000,000 (or $50,000,000 in the case of any
Subsidiary that is not a Loan Party) in amount and such warrant, writ,
execution or process shall not be discharged, vacated, stayed or bonded for a
period of 30 days; provided, however, that if a bond has been issued in favor
of the claimant or other Person obtaining such warrant, writ, execution or
process, the issuer of such bond shall execute a waiver or subordination
agreement in form and substance satisfactory to the Agent pursuant to which the
issuer of such bond subordinates its right of reimbursement, contribution or
subrogation to the Obligations and waives or subordinates any Lien it may have
on the assets of any Loan Party.

 

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

 

76

 

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

 

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

 

(m)          Change of
Control/Change in Management.

 

(i)            Any
“person” or “group” (as such terms are used in Sections 13(d) and 14(d) of
the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), is or
becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under
the Exchange Act, except that a Person will be deemed to have “beneficial
ownership” of all securities that such Person has the right to acquire, whether
such right is exercisable immediately or only after the passage of time),
directly or indirectly, of more than 25% of the total voting power of the then
outstanding voting stock of the Parent;

 

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

 

(iii)          Parent,
or any Wholly Owned Subsidiary of the Parent, shall cease for any reason to be
the general partner of the Borrower.

 

Section 11.2.  Remedies Upon Event
of Default.

 

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

 

(a)           Acceleration;
Termination of Facilities.

 

(i)            Automatic.  Upon the occurrence of an Event of Default
specified in Sections 11.1.(f) or 11.1.(g),
(A)(i) the principal of, and all accrued interest on, the Loans and the
Notes at the time outstanding, (ii) an amount equal to the Stated Amount
of all Letters of Credit outstanding as of the date of the occurrence of such
Event of Default for deposit into the Collateral Account pursuant to Section 11.5.
and (iii) all of the other Obligations of the Borrower, including, but not
limited to, the other amounts owed to the Lenders, the Swingline Lender and the
Agent under this Agreement, the Notes or any of the other Loan Documents shall
become immediately and automatically due and payable by the Borrower without
presentment, demand, protest, or other notice of any kind, all of which are
expressly waived by the Borrower and (B) all of the Commitments, the

 

77

 

obligation of the
Lenders to make Revolving Loans, the Swingline Commitment, the obligation of
the Swingline Lender to make Swingline Loans, and the obligation of the Agent
to issue Letters of Credit hereunder, shall all immediately and automatically
terminate.

 

(ii)           Optional.  If any other Event of Default shall exist,
the Agent shall, at the direction of the Requisite Lenders:  (A) declare (1) the principal of,
and accrued interest on, the Loans and the Notes at the time outstanding, (2) an
amount equal to the Stated Amount of all Letters of Credit outstanding as of
the date of the occurrence of such other Event of Default for deposit into the
Collateral Account pursuant to Section 11.5. and (3) all of the other
Obligations, including, but not limited to, the other amounts owed to the
Lenders and the Agent under this Agreement, the Notes or any of the other Loan
Documents to be forthwith due and payable, whereupon the same shall immediately
become due and payable without presentment, demand, protest or other notice of
any kind, all of which are expressly waived by the Borrower and (B) terminate
the Commitments, the Swingline Commitment and the obligation of the Lenders to
make Loans hereunder and the obligation of the Agent to issue Letters of Credit
hereunder.

 

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

 

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

 

(d)           Appointment of
Receiver.  To the extent permitted by
Applicable Law, the Agent and the Lenders shall be entitled to the appointment
of a receiver for the assets and properties of the Parent, the Borrower and
their respective Subsidiaries, without notice of any kind whatsoever and
without regard to the adequacy of any security for the Obligations or the
solvency of any party bound for its payment, to take possession of all or any
portion of the business operations of the Parent, the Borrower and their
respective Subsidiaries and to exercise such power as the court shall confer
upon such receiver.

 

Section 11.3.  Remedies Upon
Default.

 

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

 

Section 11.4.  Allocation of Proceeds.

 

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

 

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

 

78

 

(b)           amounts due to the Lenders in respect of fees and expenses
due under Section 13.2., pro rata in the amount then due each Lender;

 

(c)           payments of interest on Swingline Loans;

 

(d)           payments of interest on all other Loans and Reimbursement
Obligations, to be applied for the ratable benefit of the Lenders;

 

(e)           payments of principal of Swingline Loans;

 

(f)            payments
of principal of all other Loans, Reimbursement Obligations and other Letter of
Credit Liabilities, to be applied for the ratable benefit of the Lenders;
provided, however, to the extent that any amounts available for distribution
pursuant to this subsection are attributable to the issued but undrawn
amount of an outstanding Letters of Credit, such amounts shall be paid to the
Agent for deposit into the Collateral Account);

 

(g)           amounts due the Agent and the Lenders pursuant to
Sections 12.7. and 13.9.;

 

(h)           payments
of all other Obligations and other amounts due and owing by the Borrower and
the other Loan Parties under any of the Loan Documents, if any, to be applied
for the ratable benefit of the Lenders; and

 

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

 

Section 11.5.  Collateral Account.

 

(a)           As collateral security
for the prompt payment in full when due of all Letter of Credit Liabilities and
the other Obligations, the Borrower hereby pledges and grants to the Agent, for
the ratable benefit of the Agent and the Lenders as provided herein, a security
interest in all of its right, title and interest in and to the Collateral
Account and the balances from time to time in the Collateral Account (including
the investments and reinvestments therein provided for below).  The balances from time to time in the
Collateral Account shall not constitute payment of any Letter of Credit
Liabilities until applied by the Agent as provided herein.  Anything in this Agreement to the contrary
notwithstanding, funds held in the Collateral Account shall be subject to
withdrawal only as provided in this Section.

 

(b)           Amounts on deposit in
the Collateral Account shall be invested and reinvested by the Agent in such
Cash Equivalents as the Agent shall determine in its sole discretion.  All such investments and reinvestments shall
be held in the name of and be under the sole dominion and control of the Agent
for the ratable benefit of the Lenders. 
The Agent shall exercise reasonable care in the custody and preservation
of any funds held in the Collateral Account and shall be deemed to have
exercised such care if such funds are accorded treatment substantially
equivalent to that which the Agent accords other funds deposited with the
Agent, it being understood that

 

79

 

the Agent shall not have any responsibility
for taking any necessary steps to preserve rights against any parties with
respect to any funds held in the Collateral Account.

 

(c)           If a drawing pursuant
to any Letter of Credit occurs on or prior to the expiration date of such
Letter of Credit, the Borrower and the Lenders authorize the Agent to use the
monies deposited in the Collateral Account to make payment to the beneficiary
with respect to such drawing or the payee with respect to such presentment.

 

(d)           If an Event of Default
exists, the Requisite Lenders may, in their discretion, at any time and from
time to time, instruct the Agent to liquidate any such investments and
reinvestments and apply proceeds thereof to the Obligations in accordance with Section 11.4.

 

(e)           So long as no Default
or Event of Default exists, and to the extent amounts on deposit in the
Collateral Account exceed the aggregate amount of the Letter of Credit
Liabilities, the Agent shall, from time to time, at the request of the
Borrower, deliver to the Borrower within 10 Business Days after the Agent’s
receipt of such request from the Borrower, against receipt but without any
recourse, warranty or representation whatsoever, such of the balances in the
Collateral Account as exceed the aggregate amount of Letter of Credit
Liabilities at such time.

 

(f)            The Borrower shall pay
to the Agent from time to time such fees as the Agent normally charges for
similar services in connection with the Agent’s administration of the
Collateral Account and investments and reinvestments of funds therein.

 

Section 11.6.  Performance by Agent.

 

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

 

Section 11.7.  Rights Cumulative.

 

The rights and remedies of the Agent and the Lenders under this
Agreement and each of the other Loan Documents shall be cumulative and not
exclusive of any rights or remedies which any of them may otherwise have under
Applicable Law.  In exercising their
respective rights and remedies the Agent and the Lenders may be selective and
no failure or delay by the Agent or any of the Lenders in exercising any right
shall operate as a waiver of it, nor shall any single or partial exercise of
any power or right preclude its other or further exercise or the exercise of
any other power or right.

 

80

 

ARTICLE XII. THE AGENT

 

Section 12.1.  Authorization and Action.

 

Each Lender hereby appoints and authorizes
the Agent to take such action as contractual representative on such Lender’s
behalf and to exercise such powers under this Agreement and the other Loan
Documents as are specifically delegated to the Agent by the terms hereof and
thereof, together with such powers as are reasonably incidental thereto.  Not in limitation of the foregoing, each
Lender authorizes and directs the Agent to enter into the Loan Documents for
the benefit of the Lenders.  Each Lender
hereby agrees that, except as otherwise set forth herein, any action taken by
the Requisite Lenders in accordance with the provisions of this Agreement or
the Loan Documents, and the exercise by the Requisite Lenders of the powers set
forth herein or therein, together with such other powers as are reasonably
incidental thereto, shall be authorized and binding upon all of the
Lenders.  Nothing herein shall be
construed to deem the Agent a trustee or fiduciary for
any Lender nor to impose on the Agent duties or obligations other than those
expressly provided for herein.  At the
request of a Lender, the Agent will forward to such Lender copies or, where
appropriate, originals of the documents delivered to the Agent pursuant to this
Agreement or the other Loan Documents.  The
Agent will also furnish to any Lender, upon the request of such Lender, a copy
of any certificate or notice furnished to the Agent by the Borrower, any Loan
Party or any other Affiliate of the Borrower, pursuant to this Agreement or any
other Loan Document not already delivered to such Lender pursuant to the terms
of this Agreement or any such other Loan Document.  As to any matters not expressly provided for
by the Loan Documents (including, without limitation, enforcement or collection
of any of the Obligations), the Agent shall not be required to exercise any
discretion or take any action, but shall be required to act or to refrain from
acting (and shall be fully protected in so acting or refraining from acting)
upon the instructions of the Requisite Lenders (or all of the Lenders if
explicitly required under any other provision of this Agreement), and such
instructions shall be binding upon all Lenders and all holders of any of the
Obligations; provided, however, that, notwithstanding anything in this
Agreement to the contrary, the Agent shall not be required to take any action
which exposes the Agent to personal liability or which is contrary to this
Agreement or any other Loan Document or Applicable Law.  Not in limitation of the foregoing, the Agent
shall not exercise any right or remedy it or the Lenders may have under any
Loan Document upon the occurrence of a Default or an Event of Default unless
the Requisite Lenders have so directed the Agent to exercise such right or
remedy.

 

Section 12.2.  Agent’s Reliance, Etc.

 

Notwithstanding any other provisions of this Agreement or any other
Loan Documents, neither the Agent nor any of its directors, officers, agents,
employees or counsel shall be liable for any action taken or omitted to be
taken by it or them under or in connection with this Agreement or any other
Loan Document, except for its or their own gross negligence or willful
misconduct as determined by a court of competent jurisdiction in a final,
non-appealable judgment.  Without
limiting the generality of the foregoing, the Agent: (a) may treat the
payee of any Note as the holder thereof until the Agent receives written notice
of the assignment or transfer thereof signed by such payee and in form
satisfactory to the Agent; (b) may consult with legal counsel (including
its own counsel or counsel for the Borrower or any other Loan Party),
independent public accountants and other experts selected by it and shall not
be liable for any

 

81

 

action taken or omitted to be taken in good faith by it in accordance
with the advice of such counsel, accountants or experts; (c) makes no
warranty or representation to any Lender or any other Person and shall not be
responsible to any Lender or any other Person for any statements, warranties or
representations made by any Person in or in connection with this Agreement or
any other Loan Document; (d) shall not have any duty to ascertain or to
inquire as to the performance or observance of any of the terms, covenants or
conditions of any of this Agreement or any other Loan Document or the
satisfaction of any conditions precedent under this Agreement or any Loan
Document on the part of the Borrower or other Persons or inspect the property,
books or records of the Borrower or any other Person; (e) shall not be
responsible to any Lender for the due execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement or any
other Loan Document, any other instrument or document furnished pursuant thereto
or any collateral covered thereby or the perfection or priority of any Lien in
favor of the Agent on behalf of the Lenders in any such collateral; and (f) shall
incur no liability under or in respect of this Agreement or any other Loan
Document by acting upon any notice, consent, certificate or other instrument or
writing (which may be by telephone or telecopy) believed by it to be genuine
and signed, sent or given by the proper party or parties.

 

Section 12.3.  Notice of Defaults.

 

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

 

Section 12.4.  Wachovia as Lender.

 

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

 

82

 

Section 12.5.  Approvals of Lenders.

 

All communications from the Agent to any Lender requesting such Lender’s
determination, consent, approval or disapproval (a) shall be given in the
form of a written notice to such Lender, (b) shall be accompanied by a
description of the matter or issue as to which such determination, approval,
consent or disapproval is requested, or shall advise such Lender where
information, if any, regarding such matter or issue may be inspected, or shall
otherwise describe the matter or issue to be resolved, (c) shall include,
if reasonably requested by such Lender and to the extent not previously
provided to such Lender, written materials and a summary of all oral
information provided to the Agent by the Parent and the Borrower in respect of
the matter or issue to be resolved, and (d) shall include the Agent’s
recommended course of action or determination in respect thereof.  Each Lender shall reply promptly, but in any
event within 10 Business Days (or such lesser or greater period as may be
specifically required under the Loan Documents) of receipt of such
communication.  Except as otherwise
provided in this Agreement, unless a Lender shall give written notice to the
Agent that it specifically objects to the recommendation or determination of
the Agent (together with a written explanation of the reasons behind such
objection) within the applicable time period for reply (which shall be no less
than 10 Business Days), such Lender shall be deemed to have conclusively
approved of or consented to such recommendation or determination.

 

Section 12.6.  Lender Credit Decision, Etc.

 

Each Lender expressly acknowledges and agrees that neither the Agent
nor any of its officers, directors, employees, agents, counsel, attorneys-in-fact
or other affiliates has made any representations or warranties as to the
financial condition, operations, creditworthiness, solvency or other
information concerning the business or affairs of the Borrower, any other Loan
Party, any Subsidiary or any other Person to such Lender and that no act by the
Agent hereafter taken, including any review of the affairs of the Parent, the
Borrower, any other Loan Party or any other Subsidiary of the Parent or the
Borrower, shall be deemed to constitute any such representation or warranty by
the Agent to any Lender.  Each Lender
acknowledges that it has made its own credit and legal analysis and decision to
enter into this Agreement and the transactions contemplated hereby,
independently and without reliance upon the Agent, any other Lender or counsel
to the Agent, or any of their respective officers, directors, employees and
agents, and based on the financial statements of the Parent, the Borrower, the
Subsidiaries or any other Affiliate thereof, and inquiries of such Persons, its
independent due diligence of the business and affairs of the Borrower, the Loan
Parties, the Subsidiaries of the Parent and the Borrower and other Persons, its
review of the Loan Documents, the legal opinions required to be delivered to it
hereunder, the advice of its own counsel and such other documents and
information as it has deemed appropriate. 
Each Lender also acknowledges that it will, independently and without
reliance upon the Agent, any other Lender or counsel to the Agent or any of
their respective officers, directors, employees and agents, and based on such
review, advice, documents and information as it shall deem appropriate at the
time, continue to make its own decisions in taking or not taking action under
the Loan Documents.  Except for notices,
reports and other documents and information expressly required to be furnished
to the Lenders by the Agent under this Agreement or any of the other Loan
Documents, the Agent shall have no duty or responsibility to provide any Lender
with any credit or other information concerning the business, operations,
property, financial and other condition or creditworthiness of the Borrower,
any other Loan Party

 

83

 

or any other Affiliate thereof which may
come into possession of the Agent, or any of its officers, directors,
employees, agents, attorneys-in-fact or other affiliates.  Each Lender acknowledges that the Agent’s
legal counsel in connection with the transactions contemplated by this
Agreement is only acting as counsel to the Agent and is not acting as counsel
to such Lender.

 

Section 12.7.  Indemnification of Agent.

 

Each Lender agrees to indemnify the Agent (to the extent not reimbursed
by the Borrower and without limiting the obligation of the Borrower to do so)
pro rata in accordance with such Lender’s respective Commitment Percentage,
from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever which may at any time be imposed on, incurred by, or
asserted against the Agent (in its capacity as Agent but not as a Lender) in
any way relating to or arising out of the Loan Documents, any transaction
contemplated hereby or thereby or any action taken or omitted by the Agent
under the Loan Documents (collectively, “Indemnifiable Amounts”); provided,
however, that no Lender shall be liable for any portion of such Indemnifiable
Amounts to the extent resulting from the Agent’s gross negligence or willful
misconduct as determined by a court of competent jurisdiction in a final,
non-appealable judgment or if the Agent fails to follow the written direction
of the Requisite Lenders (or all of the Lenders if expressly required
hereunder) unless such failure results from the Agent following the advice of
counsel to the Agent of which advice the Lenders have received notice.  Without limiting the generality of the
foregoing but subject to the preceding proviso, each Lender agrees to reimburse
the Agent (to the extent not reimbursed by the Borrower and without limiting
the obligation of the Borrower to do so), promptly upon demand for its ratable
share of any out-of-pocket expenses (including counsel fees of the counsel(s)
of the Agent’s own choosing) incurred by the Agent in connection with the
preparation, negotiation, execution, or enforcement of, or legal advice with
respect to the rights or responsibilities of the parties under, the Loan
Documents, any suit or action brought by the Agent to enforce the terms of the
Loan Documents and/or collect any Obligations, any “lender liability” suit or
claim brought against the Agent and/or the Lenders, and any claim or suit
brought against the Agent, and/or the Lenders arising under any Environmental
Laws.  Such out-of-pocket expenses
(including counsel fees) shall be advanced by the Lenders on the request of the
Agent notwithstanding any claim or assertion that the Agent is not entitled to
indemnification hereunder upon receipt of an undertaking by the Agent that the
Agent will reimburse the Lenders if it is actually and finally determined by a
court of competent jurisdiction that the Agent is not so entitled to
indemnification.  The agreements in this Section shall
survive the payment of the Loans and all other amounts payable hereunder or
under the other Loan Documents and the termination of this Agreement.  If the Borrower shall reimburse the Agent for
any Indemnifiable Amount following payment by any Lender to the Agent in respect
of such Indemnifiable Amount pursuant to this Section, the Agent shall share
such reimbursement on a ratable basis with each Lender making any such payment.

 

Section 12.8.  Successor Agent.

 

The Agent may resign at any time as Agent under the Loan Documents by
giving written notice thereof to the Lenders and the Borrower.  The Agent may be removed as Agent under the
Loan Documents for gross negligence or willful misconduct upon

30-day’s prior written notice

 

84

 

by all Lenders (other than the Lender then
acting as Agent).  Upon any such
resignation or removal, the Requisite Lenders shall have the right to appoint a
successor Agent which appointment shall, provided no Default or Event of
Default exists, be subject to the Borrower’s approval, which approval shall not
be unreasonably withheld or delayed (except that the Borrower shall, in all
events, be deemed to have approved each Lender and its affiliates as a
successor Agent).  If no successor Agent
shall have been so appointed in accordance with the immediately preceding
sentence, and shall have accepted such appointment, within 30 days after the
resigning Agent’s giving of notice of resignation or the giving of notice of
the removal of the Agent, then the resigning or removed Agent may, on behalf of
the Lenders, appoint a successor Agent, which shall be a Lender, if any Lender
shall be willing to serve, and otherwise shall be a commercial bank having
total combined assets of at least $50,000,000,000; provided, the resigning or
removed Agent shall continue to serve as Agent until such time as a successor
Agent shall have accepted such appointment. 
Upon the acceptance of any appointment as Agent hereunder by a successor
Agent, such successor Agent shall thereupon succeed to and become vested with all
the rights, powers, privileges and duties of the retiring Agent, and the
retiring Agent shall be discharged from its duties and obligations under the
Loan Documents; provided, however, such retiring Agent shall not be relieved
from any obligations arising prior to its discharge the extent resulting from
the Agent’s gross negligence or willful misconduct as determined by a court of
competent jurisdiction in a final, non-appealable judgment or from the failure
by the Agent to follow the written direction of the Requisite Lenders (or all
of the Lenders if expressly required hereunder) unless such failure results
from the Agent following the advice of counsel to the Agent of which advice the
Lenders have received notice.  Such
successor Agent shall issue letters of credit in substitution for the Letters
of Credit, if any, outstanding at the time of such succession or shall make
other arrangements satisfactory to the current Agent, in either case, to assume
effectively the obligations of the current Agent with respect to such Letters
of Credit.  After any
Agent’s resignation or removal hereunder as Agent, the provisions of this Article XII.
shall continue to inure to its benefit as to any
actions taken or omitted to be taken by it while it was Agent under the Loan
Documents.

 

Section 12.9.  Titled Agents.

 

Each of the Titled Agents in each such respective capacity,
assumes no responsibility or obligation hereunder, including, without
limitation, for servicing, enforcement or collection of any of the Loans, nor any
duties as an agent hereunder for the Lenders. 
The titles of “Co-Arranger”, “Syndication Agent” and “Tri-Documentation
Agent” are solely honorific and imply no fiduciary responsibility on the part
of the Titled Agents to the Agent, the Borrower or any Lender and the use of
such titles does not impose on the Titled Agents any duties or obligations
greater than those of any other Lender or entitle the Titled Agents to any
rights other than those to which any other Lender is entitled.

 

ARTICLE XIII. MISCELLANEOUS

 

Section 13.1.  Notices.

 

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

 

85

 

If to the Parent:

 

Corporate
Office Properties Trust

8815 Centre Park Drive, Suite 400

Columbia, Maryland 21045

Attention: General Counsel

Telephone
Number:                    (410)
730-9092

Telecopy
Number:                           (410)
740-1174

 

If to the Borrower:

 

Corporate Office Properties, L.P.

8815 Centre Park Drive, Suite 400

Columbia, Maryland 21045

Attention: General Counsel

Telephone
Number:                    (410)
730-9092

Telecopy
Number:                           (410)
740-1174

 

If to the Agent:

 

Wachovia Bank, National Association

301
S. College St., NC0172

Charlotte, North Carolina 28288

Attn: Rex E. Rudy

Telephone:                 (704) 383-6506

Telecopy:                        (704) 383-6205

 

If to a Lender:

 

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

 

or, as to each party at such other address
as shall be designated by such party in a written notice to the other parties
delivered in compliance with this Section. 
All such notices and other communications shall be effective (i) if
mailed, when received; (ii) if telecopied, when transmitted; or (iii) if
hand delivered or sent by overnight courier, when delivered.  Notwithstanding the
immediately preceding sentence, all notices or communications to the Agent or
any Lender under Article II.  shall be
effective only when actually received or when receipt is refused.  Neither the Agent nor any Lender shall incur
any liability to the Borrower (nor shall the Agent incur any liability to the
Lenders) for acting upon any telephonic notice referred to in this Agreement
which the Agent or such Lender, as the case may be, believes in good faith to
have been given by a Person authorized to deliver such notice or for otherwise
acting in good faith

 

86

 

hereunder. Failure of a Person designated
to get a copy of a notice to receive such copy shall not affect the validity of
notice properly given to any other Person.

 

Section 13.2.  Expenses.

 

The Borrower agrees (a) to pay or reimburse the Agent for all of
its reasonable out-of-pocket costs and expenses incurred in connection with the
preparation, negotiation and execution of, and any amendment, supplement or
modification to, any of the Loan Documents (including due diligence expenses
and travel expenses relating to closing), and the consummation and
administration of the transactions contemplated thereby, including the
reasonable fees and disbursements of counsel to the Agent and costs and
expenses in connection with the use of Intralinks, Inc. or other similar
information transmission systems in connection with the Loan Documents, (b) to
pay or reimburse the Agent, and the Lenders for all their costs and expenses
incurred in connection with the enforcement or preservation of any rights under
the Loan Documents, including the reasonable fees and disbursements of their
respective counsel (including the allocated fees and expenses of in-house
counsel) and any payments in indemnification or otherwise payable by the
Lenders to the Agent pursuant to the Loan Documents, (c) to pay, and
indemnify and hold harmless the Agent, and the Lenders from, any and all
recording and filing fees and any and all liabilities with respect to, or
resulting from any failure to pay or delay in paying, documentary, stamp,
excise and other similar taxes, if any, which may be payable or determined to
be payable in connection with the execution and delivery of any of the Loan
Documents, or consummation of any amendment, supplement or modification of, or
any waiver or consent under or in respect of, any Loan Document; and (d) to
the extent not already covered by any of the preceding subsections, to pay or
reimburse the Agent, and the Lenders for all their costs and expenses incurred
in connection with any bankruptcy or other proceeding of the type described in
Sections 11.1.(f) or 11.1.(g), including the reasonable fees and
disbursements of counsel to the Agent and any Lender, whether such fees and
expenses are incurred prior to, during or after the commencement of such
proceeding or the confirmation or conclusion of any such proceeding.  If the Borrower shall fail to pay any amounts
required to be paid by it pursuant to this Section, the Agent, and/or the
Lenders may pay such amounts on behalf of the Borrower and either deem the same
to be Loans outstanding hereunder or otherwise Obligations owing hereunder.

 

Section 13.3.  Setoff.

 

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

 

87

 

other Obligations have been declared to be,
or have otherwise become, due and payable as permitted by Section 11.2.,
and although such obligations shall be contingent or unmatured.

 

Section 13.4.  Litigation; Jurisdiction;
Other Matters; Waivers.

 

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

 

(b)           EACH OF THE PARENT,
THE BORROWER, THE AGENT AND EACH LENDER HEREBY AGREES THAT THE FEDERAL DISTRICT
COURT LOCATED IN NORTH CAROLINA AND ANY STATE COURT LOCATED IN CHARLOTTE, NORTH
CAROLINA, SHALL HAVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES
BETWEEN OR AMONG THE PARENT, THE BORROWER, THE AGENT OR ANY OF THE LENDERS,
PERTAINING DIRECTLY OR INDIRECTLY TO THIS AGREEMENT, THE LOANS AND LETTERS OF
CREDIT, THE NOTES OR ANY OTHER LOAN DOCUMENT OR TO ANY MATTER ARISING HEREFROM
OR THEREFROM.  THE PARENT, THE BORROWER
AND EACH OF THE LENDERS EXPRESSLY SUBMIT AND CONSENT IN ADVANCE TO SUCH
JURISDICTION IN ANY ACTION OR PROCEEDING COMMENCED IN SUCH COURTS WITH RESPECT
TO SUCH CLAIMS OR DISPUTES.  EACH PARTY
FURTHER WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE
VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR
PROCEEDING WAS BROUGHT IN AN INCONVENIENT FORUM, AND EACH AGREES NOT TO PLEAD
OR CLAIM THE SAME.  THE CHOICE OF FORUM
SET FORTH IN THIS SECTION SHALL NOT BE DEEMED TO PRECLUDE THE BRINGING OF
ANY ACTION BY THE AGENT OR ANY LENDER OR THE ENFORCEMENT BY THE AGENT OR ANY
LENDER OF ANY JUDGMENT OBTAINED IN SUCH FORUM IN ANY OTHER APPROPRIATE
JURISDICTION.

 

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

 

88

 

Section 13.5.  Successors and Assigns.

 

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

 

(b)           Any Lender may make,
carry or transfer Loans at, to or for the account of any of its branch offices
or the office of an affiliate of such Lender except to the extent such transfer
would result in increased costs to the Borrower.

 

(c)           Any Lender may at
any time grant to one or more banks or other financial institutions (each a “Participant”)
participating interests in its Commitment or the Obligations owing to such
Lender; provided, however, (i) any such participating interest must be for
a constant and not a varying percentage interest, and (ii) after giving
effect to any such participation by a Lender, the amount of its Commitment, or
if the Commitments have been terminated, the aggregate outstanding principal
balance of Notes held by it, in which it has not granted any participating
interests must be equal to or exceed $5,000,000.  Except as otherwise
provided in Section 13.3., no Participant shall have any rights or
benefits under this Agreement or any other Loan Document.  A Participant shall not be entitled to
receive any greater payment under Section 3.12. than
the applicable Lender would have been entitled to receive with respect to the
participation sold to such Participant, unless the sale of the participation to
such Participant is made with the Borrower’s prior written consent.  A Participant that is not organized under the
laws of the United States of America, any state thereof or of the District of
Columbia shall not be entitled to the benefits of Section 3.12. unless the Borrower is notified of the participation sold to
such Participant and such Participant agrees, for the benefit of the Borrower
and the Agent, to comply with Section 3.12. (c) as
though it were a Lender.  In the event of
any such grant by a Lender of a participating interest to a Participant, such
Lender shall remain responsible for the performance of its obligations
hereunder, and the Borrower and the Agent shall continue to deal solely and
directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement.  Any
agreement pursuant to which any Lender may grant such a participating interest
shall provide that such Lender shall retain the sole right and responsibility
to enforce the obligations of the Borrower hereunder including, without
limitation, the right to approve any amendment, modification or waiver of any
provision of this Agreement; provided, however, such Lender may agree with the
Participant that it will not, without the consent of the Participant, agree to (i) increase,
or extend the term or extend the time or waive any requirement for the
reduction or termination of, such Lender’s Commitment, (ii) extend the
date fixed for the payment of principal of or interest on the Loans or portions
thereof owing to such Lender, (iii) reduce the amount of any such payment
of principal, (iv) reduce the rate at which interest is payable thereon or
(v) release any Guarantor (except as otherwise permitted under Section 8.12.(c)).  An assignment or other transfer which is not
permitted by subsection (d) or (e) below shall be given effect
for purposes of this Agreement only to the extent of a participating interest
granted in accordance with this subsection (c).  Upon request from the Agent, a Lender shall
notify the Agent of the sale of any participation hereunder and, if requested
by the Agent,

 

89

 

certify to the Agent that such
participation is permitted hereunder and that the requirements of Section 3.12.
(c) have been satisfied.

 

(d)           Any Lender may with
the prior written consent of the Agent and, so long as no Default or Event of
Default exists, the Borrower (which consent, in each case, shall not be
unreasonably withheld (it being agreed that the Borrower’s withholding of consent
to an assignment which would result in the Borrower having to pay amounts under
Section 3.12. shall be deemed to be reasonable)), assign to one or more
Eligible Assignees (each an “Assignee”) all or a portion of its rights and
obligations under this Agreement and the Notes (including all or a portion of
its Commitments and the Loans owing to such Lender); provided, however, (i) no
such consent by the Borrower shall be required in the case of any assignment to
another Lender or any affiliate of such Lender or another Lender and no such
consent by the Agent shall be required in the case of any assignment by a
Lender to any affiliate of such Lender; (ii) unless the Borrower and the
Agent otherwise agree, after giving effect to any partial assignment by a Lender,
the Assignee shall hold, and the assigning Lender shall retain, a Commitment,
or if the Commitments have been terminated, Loans having an outstanding
principal balance, of at least $5,000,000 and integral multiples of $1,000,000
in excess thereof; and (iii) each such assignment shall be effected by
means of an Assignment and Acceptance Agreement.  Upon execution and delivery of such
instrument and payment by such Assignee to such transferor Lender of an amount
equal to the purchase price agreed between such transferor Lender and such
Assignee, such Assignee shall be a Lender party to this Agreement with respect
to the assigned interest as of the effective date of the Assignment and
Acceptance Agreement and shall have all the rights and obligations of a Lender
with respect to the assigned interest as set forth in such Assignment and
Acceptance Agreement, and the transferor Lender shall be released from its
obligations hereunder with respect to the assigned interest to a corresponding
extent, and no further consent or action by any party shall be required.  Upon the consummation of any assignment
pursuant to this subsection, the transferor Lender, the Agent and the Borrower
shall make appropriate arrangements so that new Notes are issued to the
Assignee and such transferor Lender, as appropriate.  In connection with any such assignment, the
transferor Lender shall pay to the Agent an administrative fee for processing
such assignment in the amount of $3,500.

 

(e)           The Agent shall
maintain at the Principal Office a copy of each Assignment and Acceptance
Agreement delivered to and accepted by it and a register for the recordation of
the names and addresses of the Lenders and the Commitment of each Lender from
time to time (the “Register”).  The Agent
shall give each Lender and the Borrower written notice of the assignment by any
Lender of its rights as contemplated by this Section.  The Borrower, the Agent and the Lenders may
treat each Person whose name is recorded in the Register as a Lender hereunder
for all purposes of this Agreement.  The
Register and copies of each Assignment and Acceptance Agreement shall be
available for inspection by the Borrower or any Lender at any reasonable time
and from time to time upon reasonable prior notice to the Agent and a copy
thereof shall be provided to the Borrower upon its request therefor.  Upon its receipt of an Assignment and
Acceptance Agreement executed by an assigning Lender, together with each Note
subject to such assignment, the Agent shall, if such Assignment and Acceptance
Agreement has been completed and if the Agent receives the processing and
recording fee described in subsection (d) above, (i) accept such
Assignment and Acceptance Agreement, (ii) record the

 

90

 

information contained therein in the
Register and (iii) give prompt notice thereof to the Borrower.

 

(f)            In addition to the
assignments and participations permitted under the foregoing provisions of this
Section, any Lender may assign and pledge all or any portion of its Loans and
its Notes to any Federal Reserve Bank as collateral security pursuant to
Regulation A and any Operating Circular issued by such Federal Reserve Bank,
and such Loans and Notes shall be fully transferable as provided therein.  No such assignment shall release the
assigning Lender from its obligations hereunder.

 

(g)           A Lender may furnish
any information concerning the Borrower, any other Loan Party or any of their
respective Subsidiaries in the possession of such Lender from time to time to
Assignees and Participants (including prospective Assignees and Participants)
subject to compliance with Section 13.8.

 

(h)           Anything in this Section to
the contrary notwithstanding, no Lender may assign or participate any interest
in any Loan held by it hereunder to the Borrower, any other Loan Party or any
of their respective Affiliates or Subsidiaries.

 

(i)            Each Lender agrees
that, without the prior written consent of the Borrower and the Agent, it will
not make any assignment hereunder in any manner or under any circumstances that
would require registration or qualification of, or filings in respect of, any
Loan or Note under the Securities Act or any other securities laws of the
United States of America or of any other jurisdiction.

 

Section 13.6.  Amendments.

 

(a)           Except as otherwise
expressly provided in this Agreement, any consent or approval required or
permitted by this Agreement or any other Loan Document to be given by the
Lenders may be given, and any term of this Agreement or of any other Loan
Document may be amended, and the performance or observance by the Borrower or
any other Loan Party or any Subsidiary of any terms of this Agreement or such
other Loan Document or the continuance of any Default or Event of Default may
be waived (either generally or in a particular instance and either
retroactively or prospectively) with, but only with, the written consent of the
Requisite Lenders (and, in the case of an amendment to any Loan Document, the
written consent of each Loan Party a party thereto).

 

(b)           Notwithstanding the
foregoing, without the prior written consent of each Lender adversely affected
thereby, no amendment, waiver or consent shall do any of the following:

 

(i)            increase the Commitments of the
Lenders (except for any increase in the Commitments effectuated pursuant to Section 2.15.) or subject the Lenders to any additional
obligations;

 

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

 

91

 

(iii)          reduce the amount of any Fees payable hereunder or postpone
any date fixed for payment thereof;

 

(iv)          modify
the definition of the term “Termination Date” (except as contemplated under Section 2.12.)
or otherwise postpone any date fixed for any payment of any principal of, or
interest on, any Loans or any other Obligations (including the waiver of any
Default or Event of Default as a result of the nonpayment of any such
Obligations as and when due), or extend the expiration date of any Letter of
Credit beyond the Termination Date;

 

(v)           amend or otherwise modify the provisions of Section 3.2.;

 

(vi)          modify
the definition of the term “Requisite Lenders” or otherwise modify in any other
manner the number or percentage of the Lenders required to make any
determinations or waive any rights hereunder or to modify any provision hereof,
including without limitation, any modification of this Section 13.6. if such modification would have such effect;

 

(vii)         release any Guarantor from its obligations under the
Guaranty (except as otherwise permitted under Section 8.12.(c));

 

(viii)        amend or otherwise modify the provisions of Section 2.14.
or Section 11.4.; or

 

(ix)           increase the number of Interest Periods permitted with
respect to Loans under Section 2.5.

 

(c)           No amendment, waiver
or consent, unless in writing and signed by the Agent, in such capacity, in
addition to the Lenders required hereinabove to take such action, shall affect
the rights or duties of the Agent under this Agreement or any of the other Loan
Documents.  Any
amendment, waiver or consent relating to Section 2.2.  or the obligations of the Swingline Lender under this
Agreement or any other Loan Document shall, in addition to the Lenders required
hereinabove to take such action, require the written consent of the Swingline
Lender.

 

(d)           No waiver shall
extend to or affect any obligation not expressly waived or impair any right
consequent thereon and any amendment, waiver or consent shall be effective only
in the specific instance and for the specific purpose set forth therein.  No course of dealing or delay or omission on
the part of the Agent or any Lender in exercising any right shall operate as a
waiver thereof or otherwise be prejudicial thereto.  Any Event of Default occurring hereunder
shall continue to exist until such time as such Event of Default is waived in
writing in accordance with the terms of this Section, notwithstanding any
attempted cure or other action by the Borrower, any other Loan Party or any
other Person subsequent to the occurrence of such Event of Default.  Except as otherwise explicitly provided for
herein or in any other Loan Document, no notice to or demand upon the Borrower shall
entitle the Borrower to any other or further notice or demand in similar or
other circumstances.

 

92

 

Section 13.7.  Nonliability of Agent and
Lenders.

 

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

 

Section 13.8.  Confidentiality.

 

The Agent and each Lender shall use reasonable efforts to assure that
information about the Borrower, the Parent, the other Loan Parties and other
Subsidiaries of the Parent and the Borrower, and the Properties thereof and
their operations, affairs and financial condition, not generally disclosed to
the public, which is furnished to the Agent or any Lender pursuant to the
provisions of this Agreement or any other Loan Document, is used only for the
purposes of this Agreement and the other Loan Documents and shall not be
divulged to any Person other than the Agent, the Lenders, and their respective
agents who are actively and directly participating in the evaluation,
administration or enforcement of the Loan Documents and other transactions
between the Agent or such Lender, as applicable, and the Borrower and the
Parent, but in any event the Agent and the Lenders may make disclosure: (a) to
any of their respective affiliates (provided such affiliates shall agree to
keep such information confidential in accordance with the terms of this Section 13.8.);
(b) as reasonably requested by any bona fide Assignee, Participant or
other transferee in connection with the contemplated transfer of any Commitment
or participations therein as permitted hereunder (provided they shall agree to
keep such information confidential in accordance with the terms of this
Section); (c) as required or requested by any Governmental Authority or
representative thereof or pursuant to legal process or in connection with any
legal proceedings; (d) to the Agent’s or such Lender’s independent
auditors and other professional advisors (provided they shall be notified of
the confidential nature of the information); (e) after the happening and
during the continuance of an Event of Default, to any other Person, in
connection with the exercise by the Agent or the Lenders of rights hereunder or
under any of the other Loan Documents; (f) upon Borrower’s prior consent
(which consent shall not be unreasonably withheld), to any contractual
counter-parties to any swap or similar hedging agreement or to any rating
agency; and (g) to the extent such information (x) becomes publicly
available other than as a result of a breach of this Section actually
known to such Lender to be such a breach or (y) becomes available to the
Agent or any Lender on a nonconfidential basis from a source other than the
Parent, the Borrower or any Affiliate. 
Notwithstanding the foregoing, the Agent and each Lender may disclose
any such confidential information, upon notice to the Borrower or any other
Loan Party, to the extent practicable (provided, that, any failure by the Agent
or any Lender to give such notice to the Borrower or any Loan Party shall not
subject the Agent or any Lender to any liability which may arise from such
failure to give notice), to Governmental Authorities in connection with any
regulatory examination of the Agent or such Lender or in accordance with the
regulatory compliance policy of the Agent or such Lender.

 

93

 

Section 13.9.  Indemnification.

 

(a)           The Borrower shall
and hereby agrees to indemnify, defend and hold harmless the Agent, each of the
Lenders, any affiliate of the Agent or any Lender, and their respective
directors, officers, shareholders, agents, employees and counsel (each referred
to herein as an “Indemnified Party”) from and against any and all of the
following (collectively, the “Indemnified Costs”):  losses, costs, claims, damages, liabilities,
deficiencies, judgments or expenses of every kind and nature (including,
without limitation, amounts paid in settlement, court costs and the reasonable
fees and disbursements of counsel incurred in connection with any litigation,
investigation, claim or proceeding or any advice rendered in connection
therewith, but excluding losses, costs, claims, damages, liabilities,
deficiencies, judgments or expenses indemnification in respect of which is
specifically covered by Section 3.12. or 5.1. or expressly excluded from
the coverage of such Sections 3.12. or 5.1.) incurred by an Indemnified
Party in connection with, arising out of, or by reason of, any suit, cause of
action, claim, arbitration, investigation or settlement, consent decree or
other proceeding (the foregoing referred to herein as an “Indemnity Proceeding”)
which is in any way related directly or indirectly to: (i) this Agreement
or any other Loan Document or the transactions contemplated thereby; (ii) the
making of any Loans or issuance of Letters of Credit hereunder; (iii) any
actual or proposed use by the Borrower of the proceeds of the Loans or Letters
of Credit; (iv) the Agent’s or any Lender’s entering into this Agreement; (v) the
fact that the Agent and the Lenders have established the credit facility
evidenced hereby in favor of the Borrower; (vi) the fact that the Agent
and the Lenders are creditors of the Borrower and have or are alleged to have
information regarding the financial condition, strategic plans or business
operations of the Parent, the Borrower and their respective Subsidiaries; (vii) the
fact that the Agent and the Lenders are material creditors of the Borrower and
are alleged to influence directly or indirectly the business decisions or
affairs of the Parent, the Borrower and their respective Subsidiaries or their
financial condition; (viii) the exercise of any right or remedy the Agent
or the Lenders may have under this Agreement or the other Loan Documents; (ix) any
civil penalty or fine assessed by the OFAC against, and all reasonable costs
and expenses (including counsel fees and disbursements) incurred in connection
with defense thereof by, the Agent or any Lender as a result of conduct of the
Borrower, any other Loan Party or any Subsidiary that violates a sanction
enforced by the OFAC; or (x) any violation or non-compliance by the
Parent, the Borrower or any Subsidiary of any Applicable Law (including any
Environmental Law) including, but not limited to, any Indemnity Proceeding
commenced by (A) the Internal Revenue Service or state taxing authority or
(B) any Governmental Authority or other Person under any Environmental
Law, including any Indemnity Proceeding commenced by a Governmental Authority
or other Person seeking remedial or other action to cause the Parent, the
Borrower or their respective Subsidiaries (or its respective properties) (or
the Agent and/or the Lenders as successors to the Borrower) to be in compliance
with such Environmental Laws; provided, however, that the Borrower shall not be
obligated to indemnify any Indemnified Party for (A) any acts or omissions
of such Indemnified Party in connection with matters described in this subsection to
the extent arising from the gross negligence or willful misconduct of such
Indemnified Party, as determined by a court of competent jurisdiction in a
final, non-appealable judgment or (B) Indemnified Costs to the extent
arising directly out of or resulting directly from claims of one or more
Indemnified Parties against another Indemnified Party.

 

94

 

(b)           The Borrower’s
indemnification obligations under this Section 13.9. shall
apply to all Indemnity Proceedings arising out of, or related to, the foregoing
whether or not an Indemnified Party is a named party in such Indemnity
Proceeding.  In this regard, this
indemnification shall cover all Indemnified Costs of any Indemnified Party in
connection with any deposition of any Indemnified Party or compliance with any
subpoena (including any subpoena requesting the production of documents).  This indemnification shall, among other
things, apply to any Indemnity Proceeding commenced by other creditors of the
Parent, the Borrower or any Subsidiary, any shareholder of the Parent, the
Borrower or any Subsidiary (whether such shareholder(s) are prosecuting such
Indemnity Proceeding in their individual capacity or derivatively on behalf of
the Borrower or the Parent), any account debtor of the Parent, the Borrower or
any Subsidiary or by any Governmental Authority. If indemnification is to be
sought hereunder by an Indemnified Party, then such Indemnified Party shall
notify the Borrower in writing of the commencement of any Indemnity Proceeding;
provided, however, that the failure to so notify the Borrower shall not relieve
the Borrower from any liability that it may have to such Indemnified Party
pursuant to this Section 13.9.

 

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

 

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

 

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

 

95

 

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

 

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

 

Section 13.10.  Termination; Survival.

 

At such time as (a) all of the Commitments have been terminated, (b) all
Letters of Credit have terminated, (c) none of the Lenders nor the
Swingline Lender is obligated any longer under this Agreement to make any Loans
and (d) all Obligations (other than obligations which survive as provided
in the following sentence) have been paid and satisfied in full, this Agreement
shall terminate.  The indemnities to
which the Agent, the Lenders and the Swingline Lender are entitled under the
provisions of Sections 3.12., 5.1., 5.4., 12.7., 13.2. and
13.9. and any other provision of this Agreement and the other Loan Documents, and
the provisions of Section 13.4., shall continue in full force and effect
and shall protect the Agent, the Lenders and the Swingline Lender (i) notwithstanding
any termination of this Agreement, or of the other Loan Documents, against
events arising before such termination as well as, in the case of Sections
12.7., 13.4. and 13.9., after such termination and (ii) at
all times after any such party ceases to be a party to this Agreement with
respect to all matters and events existing on or prior to the date such party
ceased to be a party to this Agreement.

 

Section 13.11.  Severability of Provisions.

 

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

 

Section 13.12.  GOVERNING LAW.

 

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

 

Section 13.13.  Counterparts.

 

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

 

96

 

Section 13.14.  Obligations with Respect to
Loan Parties.

 

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

 

Section 13.15.  Limitation of Liability.

 

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

 

Section 13.16.  Entire Agreement.

 

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

 

Section 13.17.  Construction.

 

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

 

Section 13.18.  Patriot Act.

 

The Lenders and the Agent each hereby notifies the Borrower that
pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56
(signed into law October 26, 2001)), it is required to obtain, verify and
record information that identifies the Borrower, which information includes the
name and address of the Borrower and other information that will allow such
Lender or the Agent, as applicable, to identify the Borrower in accordance with
such Act.

 

97

 

Section 13.19.  No Novation.

 

THE PARTIES HERETO HAVE ENTERED INTO THIS
AGREEMENT SOLELY TO AMEND AND RESTATE THE TERMS OF THE EXISTING CREDIT
AGREEMENT.  THE PARTIES DO NOT INTEND
THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY TO BE, AND THIS
AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY SHALL NOT BE CONSTRUED TO
BE, A NOVATION OF ANY OF THE OBLIGATIONS OWING BY THE BORROWER UNDER OR IN
CONNECTION WITH THE EXISTING CREDIT AGREEMENT OR ANY OF THE OTHER LOAN
DOCUMENTS (AS DEFINED IN THE EXISTING CREDIT AGREEMENT).

 

[Signatures on Following Pages]

 

98

 

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

 

 

	
   

  	
  CORPORATE OFFICE PROPERTIES, L.P.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Corporate Office Properties Trust, its

  sole general partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   /s/ Roger A. Waesche, Jr.

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Roger A. Waesche, Jr.

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Executive Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CORPORATE OFFICE PROPERTIES TRUST

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Roger A. Waesche, Jr.

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Roger A. Waesche, Jr.

  
	
   

  	
   

  	
  Title:

  	
  Executive Vice President

  
								

 

 

[Signature Page to Amended and Restated Credit Agreement dated as of

June     , 2005 with Corporate Office Properties
Trust]

 

 

	
   

  	
  WACHOVIA BANK, NATIONAL

  ASSOCIATION, as Agent, as a Lender and as

  Swingline Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David Hoagland

  	
   

  
	
   

  	
   

  	
  Name: David Hoagland

  
	
   

  	
   

  	
  Title: Director

  
	
   

  	
   

  
	
   

  	
  Commitment Amount:

  
	
   

  	
   

  
	
   

  	
  $42,500,000

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lending Office (all Types of Loans):

  
	
   

  	
   

  
	
   

  	
  Wachovia Bank, National Association

  
	
   

  	
  301 South College Street, 16th Floor

  
	
   

  	
  Charlotte, North Carolina 28288

  
	
   

  	
  Attn:  Rex Rudy

  
	
   

  	
  Telecopier:

  	
  (704) 383-6205

  
	
   

  	
  Telephone:

  	
  (704) 383-6506

  
					

 

 

	
   

  	
  KEYBANK, NATIONAL
  ASSOCIATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John Scott

  	
   

  
	
   

  	
   

  	
  Name: John Scott

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Commitment Amount:

  
	
   

  	
   

  
	
   

  	
  $42,500,000

  
	
   

  	
   

  
	
   

  	
  Lending Office (all Types of Loans):

  
	
   

  	
   

  
	
   

  	
  KeyBank, National Association

  
	
   

  	
  127 Public Square

  
	
   

  	
  8th Floor

  
	
   

  	
  Cleveland, OH 44114

  
	
   

  	
  Attn:  John Scott

  
	
   

  	
  Telephone:

  	
  (216) 689-5986

  
	
   

  	
  Telecopy:

  	
  (216) 689-4997

  
					

 

 

	
   

  	
  MANUFACTURERS
  AND TRADERS TRUST

  COMPANY, a New York Banking Corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Matthew Lind

  	
   

  
	
   

  	
   

  	
  Name: Matthew Lind

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Commitment Amount:

  
	
   

  	
   

  
	
   

  	
  $37,500,000

  
	
   

  	
   

  
	
   

  	
  Lending Office (all Types of Loans):

  
	
   

  	
   

  
	
   

  	
  Manufacturers and Traders Trust Company,

  a New York Banking Corporation

  
	
   

  	
  25 S. Charles Street

  
	
   

  	
  17th Floor

  
	
   

  	
  Baltimore, MD 21201

  
	
   

  	
  Attn:  Jaynce Caruthers

  
	
   

  	
  Telephone:

  	
  (410) 545-2399

  
	
   

  	
  Telecopy:

  	
  (410) 545-2358

  
					

 

 

	
   

  	
  BANK OF
  AMERICA, N.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael W. Edwards

  	
   

  
	
   

  	
   

  	
  Name: Michael W. Edwards

  
	
   

  	
   

  	
  Title: Senior Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Commitment Amount:

  
	
   

  	
   

  
	
   

  	
  $37,500,000

  
	
   

  	
   

  
	
   

  	
  Lending Office (all Types of Loans):

  
	
   

  	
   

  
	
   

  	
  Bank of America, N.A.

  
	
   

  	
  231 South LaSalle St.

  
	
   

  	
  IL1-231-10-35

  
	
   

  	
  Chicago, IL 60697

  
	
   

  	
  Attn: Michael Edwards

  
	
   

  	
  Telephone:

  	
  (312) 828-5175

  
	
   

  	
  Telecopy:

  	
  (312) 974-4970

  
					

 

 

	
   

  	
  WELLS FARGO BANK, NATIONAL

  ASSOCIATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jennifer A. Dakin

  	
   

  
	
   

  	
   

  	
  Name: Jennifer A. Dakin

  
	
   

  	
   

  	
  Title: Assistant Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Commitment Amount:

  
	
   

  	
   

  
	
   

  	
  $37,500,000

  
	
   

  	
   

  
	
   

  	
  Lending Office (all Types of Loans):

  
	
   

  	
   

  
	
   

  	
  Wells Fargo Bank, National Association

  
	
   

  	
  2120 Park Place, 1st Floor

  
	
   

  	
  El Segundo, CA 90245-4714

  
	
   

  	
  Attn:  Puree Rhein

  
	
   

  	
  Telephone:

  	
  (310) 335-9473

  
	
   

  	
  Telecopy:

  	
  (310) 615-1014

  
					

 

 

	
   

  	
  SUNTRUST BANK

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Nancy B. Richards

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Nancy B. Richards

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice President

  	
   

  
	
   

  	
   

  
	
   

  	
  Commitment Amount:

  
	
   

  	
   

  
	
   

  	
  $25,000,000

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lending Office (all Types of Loans):

  
	
   

  	
   

  
	
   

  	
  SunTrust Bank

  
	
   

  	
  8330 Boone Boulevard

  
	
   

  	
  8th Floor

  
	
   

  	
  Vienna, VA 22182

  
	
   

  	
  Attn:  Nancy Richards

  
	
   

  	
  Telephone:

  	
  (703) 442-1557

  
	
   

  	
  Telecopy:

  	
  (703) 442-1570

  
									

 

 

	
   

  	
  CITIZENS BANK OF PENNSYLVANIA

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kellie Anderson

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Kellie Anderson

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Commitment Amount:

  
	
   

  	
   

  
	
   

  	
  $25,000,000

  
	
   

  	
   

  
	
   

  	
  Lending Office (all Types of Loans):

  
	
   

  	
   

  
	
   

  	
  Citizens Bank of Pennsylvania

  
	
   

  	
  1 Citizens
  Drive RDC 160

  
	
   

  	
  Riverside,
  RI 02915

  
	
   

  	
  Attn:  Karen Norysewicz

  
	
   

  	
  Telephone:

  	
  (401) 734-5298

  
	
   

  	
  Telecopy:

  	
  (401) 734-5385

  
									

 

 

	
   

  	
  PNC BANK, NATIONAL ASSOCIATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Timothy P. Gleeson

  	
   

  
	
   

  	
   

  	
  Name: Timothy P. Gleeson

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Commitment Amount:

  
	
   

  	
   

  
	
   

  	
  $25,000,000

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lending Office (all Types of Loans):

  
	
   

  	
   

  
	
   

  	
  PNC Bank, National Association

  
	
   

  	
  One PNC Plaza

  
	
   

  	
  259 Fifth Avenue

  
	
   

  	
  Mail Stop P1-POPP-19-2

  
	
   

  	
  Pittsburgh, PA 15222-2707

  
	
   

  	
  Attn:  Colleen Choff

  
	
   

  	
  Telecopier:

  	
  (412) 762-6092

  
	
   

  	
  Telephone:

  	
  (412)
  768-3930

  
					

 

 

	
   

  	
  BRANCH BANKING AND
  TRUST COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Elizabeth L. Paulson

  	
   

  
	
   

  	
   

  	
  Name: Elizabeth L. Paulson

  
	
   

  	
   

  	
  Title: Senior Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Commitment Amount:

  
	
   

  	
   

  
	
   

  	
  $25,000,000

  
	
   

  	
   

  
	
   

  	
  Lending Office (all Types of Loans):

  
	
   

  	
   

  
	
   

  	
  Branch Banking and Trust Company

  
	
   

  	
  16410 Heritage Blvd., 3rd Flr.

  
	
   

  	
  Bowie, MD 20716

  
	
   

  	
  Attn:  Liesje Colgan

  
	
   

  	
  Telephone:

  	
  (301) 809-4896

  
	
   

  	
  Telecopy:

  	
  (301) 809-4882

  
					

 

 

	
   

  	
  BANK OF MONTREAL

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Thomas A. Batterham

  	
   

  
	
   

  	
   

  	
  Name: Thomas A. Batterham

  
	
   

  	
   

  	
  Title: Managing Director

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Commitment Amount:

  
	
   

  	
   

  
	
   

  	
  $20,000,000

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lending Office (all Types of Loans):

  
	
   

  	
   

  
	
   

  	
  Bank of Montreal

  
	
   

  	
  115 S. LaSalle St., 17W

  
	
   

  	
  Chicago, IL 60603

  
	
   

  	
  Attn:  Ellen Dancer

  
	
   

  	
  Telephone:

  	
  (312) 750-3453

  
	
   

  	
  Telecopy:

  	
  (312) 750-6061

  
					

 

 

	
   

  	
  CHEVY CHASE BANK,
  FSB

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Ronald W. Huffman

  	
   

  
	
   

  	
   

  	
  Name: Ronald W. Huffman

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
  Commitment Amount:

  
	
   

  	
   

  
	
   

  	
  $20,000,000

  
	
   

  	
   

  
	
   

  	
  Lending Office (all Types of Loans):

  
	
   

  	
   

  
	
   

  	
  Chevy Chase Bank, FSB

  
	
   

  	
  135 East Baltimore Street

  
	
   

  	
  Baltimore, MD 21202

  
	
   

  	
  Attn:  Amy Hybdzinski

  
	
   

  	
  Telephone:

  	
  (410) 230-2176

  
	
   

  	
  Telecopy:

  	
  (410) 685-1990

  
					

 

 

	
   

  	
  COMERICA BANK

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Charles Weddell

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Charles Weddell

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Commitment Amount:

  
	
   

  	
   

  
	
   

  	
  $17,500,000

  
	
   

  	
   

  
	
   

  	
  Lending Office (all Types of Loans):

  
	
   

  	
   

  
	
   

  	
  Comerica Bank

  
	
   

  	
  500 Woodward Ave

  
	
   

  	
  7th Floor

  
	
   

  	
  Detroit, MI 48226-3256

  
	
   

  	
  Attn:  Keshia Boone

  
	
   

  	
  Telephone:

  	
  (313) 222-9284

  
	
   

  	
  Telecopy:

  	
  (313) 222-3697

  
									

 

 

	
   

  	
  MELLON BANK, N.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Frederick A. Felter

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Frederick A. Felter

  	
   

  
	
   

  	
   

  	
  Title:

  	
  First Vice President

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Commitment Amount:

  
	
   

  	
   

  
	
   

  	
  $15,000,000

  
	
   

  	
   

  
	
   

  	
  Lending Office (all Types of Loans):

  
	
   

  	
   

  
	
   

  	
  Mellon Bank, N.A.

  
	
   

  	
  Mellon Bank Center

  
	
   

  	
  1735 Market Street

  
	
   

  	
  AIM # 193-0425

  
	
   

  	
  Philadelphia, PA 19103

  
	
   

  	
  Attn:  Cheryl Zaborowski

  
	
   

  	
  Telephone:

  	
  (215) 553-3711

  
	
   

  	
  Telecopy:

  	
  (215) 553-3472

  
									

 

 

	
   

  	
  FIRST
  HORIZON BANK, a division of First

  Tennessee Bank N.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. Jordan O’Neill, III

  	
   

  
	
   

  	
   

  	
  Name:

  	
  J. Jordan O’Neill, III

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice President

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Commitment Amount:

  
	
   

  	
   

  
	
   

  	
  $15,000,000

  
	
   

  	
   

  
	
   

  	
  Lending Office (all Types of Loans):

  
	
   

  	
   

  
	
   

  	
  First Horizon Bank, a division of First Tennessee Bank N.A.

  
	
   

  	
  Suite 1150

  
	
   

  	
  1650 Tysons Blvd

  
	
   

  	
  McLean, VA 22102

  
	
   

  	
  Attn:  J. Jordan O’Neill, III

  
	
   

  	
  Telephone:

  	
  (703) 394-2518

  
	
   

  	
  Telecopy:

  	
  (703) 734-1834

  
								

 

 

	
   

  	
  PROVIDENT BANK, a Maryland banking
  corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Carole A. Stafford

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Carole A. Stafford

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Commitment Amount:

  
	
   

  	
   

  
	
   

  	
  $15,000,000

  
	
   

  	
   

  
	
   

  	
  Lending Office (all Types of Loans):

  
	
   

  	
   

  
	
   

  	
  Provident Bank, a Maryland banking corporation

  
	
   

  	
  114 E.
  Lexington Street

  
	
   

  	
  Baltimore,
  MD 21202-1725

  
	
   

  	
  Attn:  Janine L. Smith

  
	
   

  	
  Telephone:

  	
  (410) 277-2775

  
	
   

  	
  Telecopy:

  	
  (410) 277-2846Exhibit 10.1

 

Wachovia Bank, National Association

One Wachovia Center, 5th Floor

301 S. College Street, NC 0537

Charlotte, North Carolina 28288-0537

 

as of June 30, 2005

 

MedQuest, Inc.

4300 North Point Parkway

Alpharetta, Georgia 30022

Attn:                    John Haggerty

Chief
Financial Officer

 

AMENDMENT TO THIRD LIMITED WAIVER

 

Dear Mr. Haggerty:

 

Reference
is made to that certain Amended and
Restated Credit Agreement, dated as of September 3, 2003 (as amended,
supplemented, restated or otherwise modified from time to time, the “Credit
Agreement”), among MQ ASSOCIATES, INC., a Delaware corporation (“Holdings”),
MEDQUEST, INC., a Delaware corporation (the “Borrower”), the lenders
from time to time party thereto (the “Lenders”), and WACHOVIA BANK,
NATIONAL ASSOCIATION (“Wachovia”), as administrative agent for the
Lenders (in such capacity, the “Administrative Agent”).

 

Reference
is also made to that certain Third Limited Waiver dated as of May 13, 2005
(the “Third Waiver”) among Holdings, the Borrower, the Lenders party thereto
and the Administrative Agent.  Capitalized
terms used herein without definition shall have the meanings given to them in
the Third Waiver.

 

The
parties hereby agree that, upon the occurrence of the Effective Date (as
defined below) hereof:

 

(a)                                  Section 1(i)(II)
of the Third Waiver is hereby deleted in its entirety and the following new Section 1(i)(II)
shall be inserted in lieu thereof:

 

“(II) one or more
Defaults and/or Events of Default that have occurred and may be continuing, or
that may occur, with respect to (x) the covenants contained in Section 7.1
of the Credit Agreement as of and for the period ended June 30, 2005, (y) the
covenants to deliver a copy of the unaudited consolidated balance sheets of the
Borrower and its consolidated Subsidiaries as at the end of the fiscal quarter
ended on March 31, 2005 and June 30,

 

1

 

2005, and the
related unaudited consolidated statements of income and cash flows for such
fiscal quarters and the portions of the fiscal year through the end of such
fiscal quarters, within 45 days after the end of such fiscal quarters, as
required by Section 6.1(b) of the Credit Agreement, and/or (z) the
failure to give notice of any such Default and/or Event of Default listed in clauses
(x) and (y) or any representation or warranty made or deemed made by Holdings
and the Borrower that no such Default and/or Event of Default has occurred ((I)
and (II), collectively, the “Third Waiver Specified Defaults”) and” ;

 

(b)                                 the
proviso to Section 1 of the Third Waiver shall be amended by deleting the
date “June 30, 2005” and inserting the date “August 1, 2005” in lieu
thereof; and

 

(c)                                  Section 2
of the Third Waiver shall be amended by deleting the reference to “Section 2(a)”
appearing therein and inserting a reference to “Section 1” in lieu
thereof.

 

This letter agreement
shall become effective upon the occurrence of each of the following (the “Effective
Date”):  (a) the Administrative Agent
shall have received a duly executed counterpart of this letter agreement from Holdings,
the Borrower and the Required Lenders; and (b) the Administrative Agent
shall have been paid or reimbursed for all fees and expenses due and owing to
the Administrative Agent to the extent invoiced prior to June 29, 2005, including,
without limitation, reimbursement for all legal fees and expenses of Morgan,
Lewis & Bockius LLP incurred by the Administrative Agent.

 

Nothing in this letter agreement
shall be construed as a waiver or modification of, any other term or condition
of the Credit Agreement or any of the instruments or agreements referred to
therein or to prejudice the right or rights which the Administrative Agent or
the Lenders may now have or may have in the future under or in connection with
the Credit Agreement or any of the instruments or agreements referred to
therein.  The Credit Agreement and all of
the other related documents, agreements and instruments shall remain in full
force and effect and are hereby ratified and confirmed in all respects.

 

This letter agreement
shall be construed in accordance with the laws (without regard to the conflict
of laws provisions) of the State of New York, but giving effect to federal laws
applicable to national banks.

 

2

 

This letter agreement may
be executed by one or more of the parties on any number of separate
counterparts, and all of said counterparts taken together shall be deemed to
constitute one and the same instrument. Delivery of an executed signature page of
this letter agreement by facsimile transmission shall be effective as delivery
of a manually executed counterpart hereof.

 

[Remainder
of page left blank intentionally]

 

3

 

Please acknowledge
receipt of this letter agreement and confirm your consent to the foregoing by
signing below, and returning a copy of this letter agreement to Lauren A. Scher, Esq.
at Morgan, Lewis & Bockius LLP, 101 Park Avenue, New York, New York
10178 by 5:00 p.m., New York City time, on June 28,
2005.

 

	
   

  	
  Very
  truly yours,

  
	
   

  	
   

  
	
   

  	
  WACHOVIA
  BANK, NATIONAL

  
	
   

  	
  ASSOCIATION,
  as Administrative Agent

  
	
   

  	
  and as a Lender

  
	
   

  	
   

  
	
   

  	
  By:

  	
    /s/
  Leanne Phillips

  	
   

  
	
   

  	
  Name:

  	
  Leanne Phillips

  
	
   

  	
  Title:

  	
  Director

  
	
   

  	
   

  
	
   

  	
   

  
	
  ACCEPTED AND

  	
   

  
	
  AGREED TO BY:

  	
   

  
	
   

  	
   

  
	
  MEDQUEST, INC.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   /s/ John
  Haggerty

  	
   

  	
   

  
	
  Name:

  	
  John Haggerty

  	
   

  
	
  Title:

  	
  Chief Financial
  Officer

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  MQ ASSOCIATES,
  INC.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   /s/ John
  Haggerty

  	
   

  	
   

  
	
  Name:

  	
  John Haggerty

  	
   

  
	
  Title:

  	
  Chief Financial
  Officer

  	
   

  
								

 

 

(signatures continued on following pages)

 

 

Signature Page to Amendment to Third Waiver

 

 

	
  CHASE LINCOLN
  FIRST

  	
   

  
	
  COMMERCIAL
  CORPORATION,

  	
   

  
	
   as a Lender

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   /s/ Dawn
  Lee Lum

  	
   

  	
   

  
	
  Name:  Dawn Lee Lum

  	
   

  
	
  Title:  Director

  	
   

  
				

 

 

	
  GENERAL ELECTRIC

  	
   

  
	
  CAPITAL
  CORPORATION,

  	
   

  
	
   as a Lender

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   /s/ Brent
  A. Shepherd

  	
   

  	
   

  
	
  Name:  Brent A. Shepherd

  	
   

  
	
  Title:  Duly Authorized Signatory

  	
   

  
				

 

 

	
  USB AG, STAMFORD
  BRANCH,

  	
   

  
	
   as a Lender

  	
   

  
	
   

  	
   

  
	
  By:

  	
   /s/
  Wilfred Saint

  	
   

  	
   

  
	
  Name:  Wilfred Saint

  	
   

  
	
  Title:  Associate Director, Banking

            Products
  Services, US

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   /s/ Richard
  L. Tavrow

  	
   

  	
   

  
	
  Name:  Richard L. Tavrow

  	
   

  
	
  Title:  Director, Banking Products

            Services, US

  	
   

  

 

 

	
  CSAM FUNDING
  III,

  	
   

  
	
   as a Lender

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   /s/ Andrew
  Marshak

  	
   

  	
   

  
	
  Name:  Andrew Marshak

  	
   

  
	
  Title:

  	
   

  
				

 

 

	
  MADISON PARK
  FUNDING,

  	
   

  
	
   as a Lender

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   /s/ Andrew
  Marshak

  	
   

  	
   

  
	
  Name:  Andrew Marshak

  	
   

  
	
  Title:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00087-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00087-of-00352.parquet"}]]