Document:

Exhibit

Amendment to Employment Agreement
(Tom Wittenschlaeger)

This AMENDMENT TO EMPLOYMENT AGREEMENT (this “Amendment”) is entered into as of January 1, 2019, by and between Fox Factory, Inc., a California corporation (the “Company”), and Tom Wittenschlaeger, an individual (“Executive”), amends that certain Employment Agreement dated as of January 26, 2015 by and between the Company and Executive (as previously amended from time to time, the “Original Agreement”) and shall be effective January 1, 2019 (the “Effective Date”). All terms not otherwise defined herein shall have the meanings ascribed thereto in the Original Agreement.

RECITALS

WHEREAS, the parties hereto desire to amend certain provisions of the Original Agreement in accordance with the terms of this Amendment;
NOW, THEREFORE, in consideration of the mutual promises and the respective mutual agreements contained herein, the parties to this Amendment agree as follows:
Section 1. Amendments. The Original Agreement is amended, effective as of the Effective Date, as follows: 
		
	a.
	Section 2(a) of the Original Agreement is DELETED and REPLACED to read as follows: 

“Executive shall serve as the Strategic Business Development Consultant of the Company and shall have the normal duties, responsibilities, functions and authority customarily associated with such position and such other duties and responsibilities as may be assigned from time to time to Executive, all subject to the power and authority of the Company’s Chief Executive Officer, Board of Directors (the “Board”) and the Executive Committee of the Board (the “Executive Committee”) to expand or limit such duties, responsibilities, functions and authority and to overrule actions of officers of the Company.”

		
	b.
	Section 3(b) of the Original Agreement is DELETED.

		
	c.
	Section 4(b)(ii) of the Original Agreement is hereby DELETED and REPLACED to read as follows:

“Following any termination under paragraphs 4(a)(iv) or (v) (and despite his subsequent death), Executive (or, in the event of Executive’s death, Executive’s estate) shall be entitled to receive (A) immediately upon termination by the Company without Cause, or within fifteen (15) days of the date of termination by Executive for Good Reason, a lump sum payment in cash in an amount equal to Executive’s accrued and unpaid Base Salary plus any authorized business expenses incurred and un-reimbursed as of the date of termination, (B) a pro rata severance (“Severance”) in an amount equal to: Executive’s per annum Base Salary as of the date of termination multiplied by a fraction, the numerator of which shall be the number of days remaining in the fiscal year following the date of termination and the denominator of which is 365 days, payable monthly for the remainder of such fiscal year in substantially equal payments beginning, as provided in Section 4(b)(iii), on the first regular payroll date immediately following the eighth (8th) day following the Executive’s timely execution of a Release, and (C) during the period Executive receives severance, COBRA insurance benefits funded by the Company, and Executive agrees to reimburse the Company for such COBRA expenses in excess of the monthly amount the Company was paying toward Executive’s Company-provided group health insurance coverage immediately prior to Executive’s cessation of employment; provided, however, if the COBRA insurance coverage period expires during the severance period, then during the remainder of the severance period, the Company shall make monthly payments to Executive to subsidize Executive’s health care insurance costs in an amount equal to the monthly dollar amount the Company was paying toward Executive’s Company-provided group health insurance coverage immediately prior to Executive’s cessation of employment. “Change of Control Event” as used herein means the occurrence of any of the following: (i) the sale, lease, transfer, conveyance or other disposition, in one or a series of related transactions, of all or substantially all of the assets of the Company to any “person” or “group” (as such terms are used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act); or (ii) any person or group, becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a person shall be deemed to have “beneficial ownership” of all shares that any 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 fifty percent (50%) of the total voting power of the voting stock of the Company, including by way of merger, consolidation, or otherwise.”
Section 2.    Change of Employment.  The Parties agree that the changes in Executive’s employment pursuant to this Amendment will not constitute “Good Reason” under the Original Agreement and Executive consents to such modifications to the terms of his employment with the Company.     

Section 3.     Effect on Original Agreement.  On and after the Effective Date, each reference in the Original Agreement to “this letter”, “hereunder”, “hereof”, “herein” or words of similar import shall mean and be a reference to the Original Agreement as amended hereby.  Except as specifically modified by the terms of this Amendment, all of the terms, provisions, covenants, warranties and agreements contained in the Original Agreement shall remain in full force and effect and are hereby ratified.

Section 4.    Governing Law.  This Amendment shall be construed under and shall be governed by the laws of the State of California.  
Section 5.    Counterparts.  This Amendment may be executed in one or more counterparts, each of which will be deemed to be an original copy of this Amendment and all of which, when taken together, will be deemed to constitute one and the same agreement.

IN WITNESS WHEREOF, the undersigned have executed and delivered this Amendment as of the date first above written.

The Company
Fox Factory, Inc.
a California corporation 

By:_/s/ Larry Enterline
Name: Larry Enterline
Title: Chief Executive Officer 

The Executive 

/s/ Tom Wittenschlaeger    
Name: Tom Wittenschlaegera101executedewbhartmanvr

MASTER CREDIT FACILITY AGREEMENT          DATED:  DECEMBER 27,   2018                                              6502991 V5 (78055.00001.000) 

 

                  MASTER CREDIT FACILITY AGREEMENT        THIS MASTER   CREDIT  FACILITY  AGREEMENT    is made and entered into as of  December 27, 2018 (the "Effective Date") by East West Bank, a California state-chartered bank having an address at 9090 Katy Freeway, 3rd Floor, Houston, Texas 77024 ("Lender"), and  Hartman vREIT XXI Operating Partnership L.P., a Texas limited partnership, having an address  at 2909 Hillcroft, Suite 420, Houston, Texas 77057 ("Hartman Partnership"), Hartman Spectrum,  LLC, a Texas limited liability company, having an address at 2909 Hillcroft, Suite 420, Houston,  Texas 77057 ("Hartman Spectrum"), Hartman 11211, LLC, Texas limited liability company,  having an address at 2909 Hillcroft, Suite 420, Houston, Texas 77057 ("Hartman 11211"; and Hartman Spectrum, Hartman 11211 and Hartman Partnership are collectively referred to herein  as "Borrowers" and each sometimes individually referred to as a "Borrower"), and Hartman  vREIT XXI, a Maryland corporation, having an address at 2909 Hillcroft, Suite 420, Houston,  Texas 77057 ("Guarantor"; and Borrowers and Guarantor are collectively referred to herein as  the "Loan Parties", and each sometimes individually referred to as a "Loan Party")                                    RECITALS:        A.    The Loan Parties have requested that Lender to enter into this Agreement to make  a $20,000,000 credit facility available (i) to Borrowers to purchase two Initial Properties (as  hereinafter defined), (ii) to Additional Borrowers (as hereinafter defined) to purchase or re- finance additional tracts of land approved by Lender (the use of the Loan funds as set forth in (i)  and (ii) immediately preceding are hereinafter referred to as "Acquisition/Refinance Purposes")  and (iii) make funds available to the parties described in (i) and (ii) immediately preceding  for  future Operational Purposes (as hereinafter defined), all as described in this Agreement.  Lender  is willing to make such credit facility available to Borrower upon and subject to the provisions,  terms, and conditions hereinafter set forth.        B.    Subject to and upon the terms and conditions of this Agreement, Lender has  agreed to lend to Borrowers the amounts herein described for the purposes set forth below.                                  AGREEMENT        NOW,  THEREFORE,  in consideration of the premises, the covenants, representations,  warranties and agreements contained herein and other good and valuable consideration, the  receipt and sufficiency of which are hereby acknowledged, the parties hereto covenant and agree  as follows:                                         1                      6502991 V5 (78055.00001.000) 

 

                                ARTICLE ONE                        DEFINITIONS AND USE OF TERMS        1.1   Definitions.  As used in this Agreement, all exhibits and schedules hereto and in  any note, certificate, report or other Loan Documents made or delivered pursuant to this  Agreement, the following terms will have the meanings given such terms in Article One.        "Acquisition/Refinance Purposes" is defined in the Recitals paragraph of this Agreement.        "Additional Borrowers" means one or more special purpose entities which (i) own and  will own no other assets of any kind other than such Additional Borrower's Prospective Property,  (ii) are direct wholly owned subsidiaries of Hartman Partnership and indirect subsidiaries of  Guarantor, (iii) together with the Loan Parties will submit an Application for Advance for  approval as a borrower under this Loan (iv) Lender has approved such party as a new additional  borrower under the Loan, Note and Loan Documents and has approved the Prospective Property  such party wishes to purchase or re-finance as collateral for the Loan and (iv) at or prior to the  Advance of Loan funds to such party, has executed and delivered to Lender the Joinder  Agreement and other Closing Deliveries regarding the Loan, the Note, the Loan Documents and  the Prospective Property required by Lender.        "Advance" means a disbursement by Lender, whether by journal entry, deposit to  Borrowers or an Additional Borrower's account, check to third party or otherwise of any of the  proceeds of the Loan, any insurance proceeds or any protective advance made under Section 8 of  a Deed of Trust or any other Loan Document.        "Agreement" means this Master Credit Facility Agreement, as the same may from time to  time be amended, supplemented, replaced or restated.        "Application for Advance" means that certain package of documents, materials and  information listed on Exhibit A below together with such other information supporting such  Application for Advance as requested by Lender.        "Borrowers" means the Persons identified as such in the introductory paragraph hereof as  Borrowers, and each of their successors and assigns.        "Borrower's Equity" means an amount, in the form of cash or other assets approval by  Lender, which equals at least fifty percent (50%) of the lesser of the Prospective Property's  appraised fair market value or the Purchase Price of the Prospective Property. Borrower's Equity  is not a requirement in the case of an Operation Draw Request for an Operational Purpose.        "Breach" is defined in Section 2.5(b).                                         2                      6502991 V5 (78055.00001.000) 

 

      "Business Day" means a day other than a Saturday, Sunday or a day on which banks in  the State of Texas are authorized to be closed.  Unless otherwise provided, the term "days"  means calendar days.        "Closing Deliveries" is defined in Section 2.6.        "Closing Statement" means a buyer/borrower closing statement for a Prospective  Property issued by the Title Company issuing to Lender the Title Policy for such Property upon  purchase or re-finance by the Additional Borrower approved by Lender, and which closing  statement shall be executed by such Additional Borrower as the purchaser or re-financing  borrower of the Prospective Property, show the final Purchase Price or re-finance amount of the  Prospective Property and all of the Additional Borrower's closing costs for the Prospective  Property, and shall otherwise be in form and substance acceptable to Lender in Lender's sole  discretion.         "Committed Sum" is defined in Section 2.1.        "Deeds of Trust" means the Initial Deeds of Trust and any deed of trust encumbering a  Mortgaged Property to secure all or any portion of the Loan, executed and delivered to Lender  by any Borrower or Additional Borrower, and which Additional Borrower deed of trust has been  approved by Lender to allow an Advance hereunder for the purchase or re-finance of such  Prospective Property.        "Disposition" means any sale, conveyance, transfer, trade, or other disposition of (a) a  Mortgaged Property or any portion thereof or (b) any direct or indirect ownership interest in a  Loan Party or Additional Borrower (other than sales of stock or other ownership interest for  Hartman Partnership or Guarantor purchased pursuant to a valid registration statement filed and  made effective with the Securities and Exchange Commission or otherwise sold pursuant to a  valid exemption from registration requirements, such interest not to exceed twenty percent (20%)  in the aggregate of the entire stock or ownership interest in any such entity in any single  transaction or series of transactions occurring within any twelve (12) month period) without the  prior written consent of Lender.        "Effective Date" means the date set forth in the introductory paragraph hereof.        "Default" has the meaning set forth in Article Six hereof.        "Financial Statements" means all balance sheets, income statements, statements of profit  and loss, statements of cash flow, statements of sources and uses of funds, and other financial  data, statements and reports (whether of Borrowers, Additional Borrowers, any Guarantor, or any  other Person or otherwise) which are required to, have been, or may from time to time hereafter,  be furnished to Lender, for the purposes of, or in connection with, an Application for Advance,  any Deeds of Trust or this Agreement.                                         3                      6502991 V5 (78055.00001.000) 

 

      "Guarantor" means the Person identified as such in the introductory paragraph hereof as  Guarantor, and each of its successors and assigns together with any Person who from time to  time guarantees the payment or performance of all or any part of the Loan.        "Guaranty" means each guaranty agreement executed by a Guarantor, including, but not  limited to the Initial Guaranty described in Section 2.3(f), guaranteeing all or any portion of the  Loan, as such may be amended, restated, supplemented or otherwise modified from time to time.        "ICR" is defined in the Note, except that when the definition of ICR is applied to a  Prospective Property its terms shall apply to such Prospective Property and the owners thereof  immediately prior to the acquisition or refinance.        "Initial Deeds of Trust" is defined in Section 2.3(d).        "Initial Properties" is defined in Section 2.3.        "Joinder Agreement" means an agreement in form and substance as set forth on Exhibit F attached hereto and made part hereof where an Additional Borrower joins and becomes a  borrower under the Loan, the Note, this Agreement and all other Loan Documents.        "Lender" means East West Bank, a California state-chartered bank and its successors and  assigns, whether or not such successor and/or assign is a financial institution.         "Lien" means any valid and enforceable interest in any property, whether real, personal or  mixed, securing an indebtedness, obligation or liability owed to or claimed by any Person other  than the owner of such property, whether such indebtedness is based on the common law or any  statute, ordinance or contract and including, but not limited to, liens created by or pursuant to a  security interest, pledge, mortgage, assignment, conditional sale, trust receipt, lease, consignment  or bailment for security purposes.        "Loan" means the collective reference to all Advances made by Lender to Borrowers or  Additional Borrowers pursuant to the Note or this Agreement together with any other sums  advanced by Lender under any of the other Loan Documents, including but not limited to any  Deed of Trust. This Loan is a revolving loan and, subject to the terms of this Agreement, all  principal amounts repaid prior to the Maturity Date may be re-borrowed until the Maturity Date  when all principal, all accrued and unpaid interest and other sums owing under any of the Loan  Documents shall be due and payable.        "Loan Documents" means this Agreement, the Note, each Deed of Trust, each Guaranty,  and any other agreements, instruments and documents evidencing, securing, guaranteeing or  pertaining to the Loan as shall from time to time be executed and delivered to Lender by any  Loan Party or any Additional Borrower or any other party pursuant to this Agreement, including,  without limitation, each Application for Advance, any future amendments hereto, or restatements  hereof, or pursuant to the terms of any of the other loan documents, together with any and all                                          4                      6502991 V5 (78055.00001.000) 

 

renewals, extensions, and restatements of, and amendments and modifications to, any such  agreements, documents, and instruments.        "Maximum Lawful Rate" means the maximum non-usurious rate of interest (or, if the  context so requires, an amount calculated at such rate) which Lender is allowed to contract for,  charge, take, reserve, or receive in this transaction under applicable federal or state (whichever is  higher) law from time to time in effect after taking into account, to the extent required by  applicable federal or state (whichever is higher) law from time to time in effect, any and all  relevant payments or charges under the Loan Documents.        "Maximum Property Advance Amount" means the lesser of: (x) fifty percent (50%) of  the Purchase Price of a Prospective Property as shown on the both the Purchase Contract and the  Closing Statement for such Prospective Property, approved by Lender in Lender's sole  discretion, for such Prospective Property; or (y) fifty percent (50%) of the appraised value of  such Prospective Property as shown on the MAI appraisal for such Prospective Property  delivered by Borrowers and Additional Borrowers to Lender and approved by Lender in Lender's  sole discretion or (z) the then current Remaining Committed Sum; provided, however, for an  Application for Advance for a refinance of a Prospective Property and not an acquisition of a  Prospective Property, sub-clause (x) shall not be included in the calculation as there is no  Purchase Contract.        "Mortgaged Property" means a Property which is then currently encumbered by the Lien  of a Deed of Trust in favor of Lender securing the Loan and which Deed of Trust has been filed  of record in the appropriate real property records of the county in which such Property is located.  The Initial Properties are part of the Mortgaged Properties.         "Obligated Party" means the Borrowers, each Additional Borrower, each Guarantor and  any other Person who is or becomes party to or makes any agreement, instrument or document  that guarantees or secures payment and performance of any of the Loan.        "Operational Draw Request" is defined in Section 2.5(b).        "Operational Purposes" is defined in Section 2.5(a).        "Permitted Encumbrances" means the exceptions to title for a Mortgaged Property as  defined and permitted for that particular Mortgaged Property under the Deed of Trust which  encumbers that particular Mortgaged Property, it being agreed by Borrowers and each Additional  Borrower that a Permitted Encumbrance allowed under one Deed of Trust is not a Permitted  Encumbrance allowed for different Deed of Trust unless such different Deed of Trust  specifically allows such Permitted Encumbrance.        "Person" means any individual, firm, corporation, limited liability company, association,  partnership, joint venture, trust, other entity, unincorporated organization or governmental  authority.                                         5                      6502991 V5 (78055.00001.000) 

 

      "Property" means a tract of land located in the State of Texas, constituting its own  separate tax lot, together with all of the improvements and all other property, both real and  personal, located on, under and above the land.        "Prospective Property" means (i) a Property that an Additional Borrower desires to  purchase with a portion of the purchase funds advanced under the Note pursuant to terms of this  Agreement, or (ii) a Property that an Additional Borrower wholly owns and desires to re-finance  with a portion of such re-finance funds advanced under the Note pursuant to terms of this  Agreement, and (iii) in both cases, the Loan Parties and such Additional Borrower has submitted  to Lender an Application for Advance regarding such Prospective Property for Lender's review  and approval, in Lender's sole discretion, pursuant to the terms of this Agreement together with  all materials and other requirements required for an Application for Advance.        "Prospective Property Closing Date" means the later of actual calendar day that (a) a  Prospective Property is purchased or re-financed by an Additional Borrower, which must be no  earlier than thirty (30) days nor no later than ninety (90) days after Lender receives the  Application for Advance for such Prospective Property, unless an earlier or later date is approved  in writing by Lender, in Lender's sole discretion and (b) the deed and Deed of Trust for such  Prospective Property is filed of record in the real property records of the county in which the  Prospective Property is located.        "Purchase Contract" means a purchase and sale contract for a Prospective Property  entered into or assumed by an Additional Borrower and delivered to Lender as part of an  Application for Advance for such Prospective Property.        "Purchase Price" means the purchase price under a Purchase Contract to be paid by an  Additional Borrower for the Prospective Property covered by such Purchase Contract.        "Request for Advance" means a written Request for Advance for Acquisition/Refinance  Purposes in form and substance as set forth on Exhibit E attached hereto and made part hereof, ,  executed delivered by Borrower, each Guarantor and each Subsidiary to Lender.        "Remaining Committed Sum" means an amount equal to the Committed Sum less (a) the  then current unpaid principal balance under the Note, this Loan Agreement, any Deed of Trust or  any other Loan Document and (b) any amount requested by Borrowers or Additional Borrowers for an Acquisition/Refinance Purpose or an Operational Purpose and Lender has approved to  advance pursuant to the terms of this Loan Agreement but has not yet funded.         "Submission Date" means the date the Loan Parties and any Additional Borrowers submit  to Lender either an Operation Draw Request for Operational Purposes or a Request for Advance  for an Acquisition/Refinance Purposes.        "Survey" means an ALTA/ACSM    "Class A"  Land Title survey (or its Texas  equivalent)of the Land of a Prospective Property consisting of a plat and field notes, prepared by                                          6                      6502991 V5 (78055.00001.000) 

 

a licensed surveyor acceptable to Lender and the applicable Title Company which survey shall:  (a) reflect the actual dimensions of the Prospective Property, the gross and net area of the  Prospective Property, the location of any easements, rights-of-way, setback lines, encroachments  or overlaps thereof or thereover and the outside boundary lines of any improvements located  thereon; (b) identify by recording reference any easements, setback lines, adjacent streets or right  of ways or other matters referred to in the title commitment for the Prospective Property issued  by the applicable Title Company; (c) include the surveyor's registration number and seal and the  date of the Survey; (d) include a surveyor's certificate acceptable to Lender within its reasonable  discretion; (e) reflect that the Prospective Property has access to and from a publicly dedicated  street, roadway or highway; (f) be sufficient to cause the applicable Title Company to delete the  "survey exception" in Schedule B of the Title Policy to the extent permitted by the rules of the  State Board of Insurance; and (g) reflect the area, including the boundaries thereof, within the  Prospective Property that has been designated by the Federal Insurance Administration, the  Army Corps of Engineers or any other Governmental Authority as being subject to special or  increased flood hazards. The Survey must also contain the certification set forth on Exhibit B from the surveyor.        "Title Company" means a title company acceptable to Lender and acting as the escrow  agent under the Purchase Contract and issuer of the Title Policy for a Prospective Property.        "Title Policy" means a TLTA mortgagee loan policy (or policies) of title insurance, and  any reinsurance agreement (or agreements) insuring title on a Mortgaged Property issued by the  Title Company acting as escrow agent under the Purchase Contract or a refinancing for such  Mortgaged Property in accordance with the requirements of Exhibit C.        "UCC" means the Uniform Commercial Code of the State of Texas or Delaware or other  applicable jurisdiction where a Borrower or an Additional Borrower is formed or incorporated,  as such code may be amended and in effect from time to time.                                 ARTICLE TWO                      COMMITMENT TO LEND; ADVANCES        2.1   Commitment to Lend.  Subject to and upon the terms, covenants, and conditions  hereof, Lender hereby agrees to lend to Borrowers and Additional Borrowers approved by  Lender an aggregate sum up to but not in excess of TWENTY MILLION AND  NO/100  DOLLARS   ($20,000,000.00) (the "Committed Sum"); provided, however, Borrowers and  Additional Borrowers have, for all Advances for Acquisition/Refinance Purposes, contributed  Borrower's Equity to the purchase or re-finance of each Prospective Property prior to or  simultaneously with the Advance of Loan funds under this Agreement to purchase or re-finance  such Prospective Property. Lender may, in Lender's sole discretion, disburse Loan proceeds  directly to third parties, including, but not limited to, Title Companies, to pay a portion of the  Purchase Price or refinance loan amount of such Prospective Property together with other costs  or expenses required to be paid by Borrowers or Additional Borrowers pursuant to this  Agreement.  All disbursements of Loan proceeds directly by Lender to third parties, including,                                          7                      6502991 V5 (78055.00001.000) 

 

but not limited to, Title Companies, to pay costs or expenses required to be paid by Borrowers or  Additional Borrowers pursuant to this Agreement, shall constitute Advances to Borrower.          2.2   Interest and Repayment.  Interest shall accrue on the Loan at the rate specified in  the Note, shall be computed on the unpaid principal balance thereof which exists from time to  time and shall be computed with respect to each Advance only from the date of the Advance.  Repayment of the Loan is governed by the terms of the Note and other Loan Documents.        2.3   Funding the Initial Advance on the date of this Agreement.  Prior to the date of  this Agreement, Borrowers submitted to Lender Financial Statements, due diligence materials  and other items listed on Exhibit A in their Applications for Advance covering the purchase of (i)  an office building located at 613 Northwest Loop 410 located in San Antonio, Texas 78216 (the  "San Antonio Property"), and (ii) an office building located at 11211 Katy Freeway located in  Houston, Texas 77079 (the "Houston Property"; and the San Antonio Property and the Houston  Property are collectively referred to as the "Initial Properties" and sometimes each individually is  referred to as an "Initial Property"). Lender approved the Applications for Advance and on the  date hereof the Loan Parties have originally executed and delivered the following to Lender or its  counsel:                     (a)   This Agreement;                    (b)   Revolving Promissory Note in the original principal amount of             $20,000,000.00 executed by the Borrowers and payable to the order of Lender;                    (c)   Deed of Trust, Assignment of Rents and Security Agreement              executed by Hartman 11211, as grantor, to Charles E. Aster, as trustee, for the              benefit of Lender encumbering the Houston Property (the "11211 DOT");                    (d)   Deed of Trust, Assignment of Rents and Security Agreement              executed by Hartman Spectrum, as grantor, to Charles E. Aster, as trustee, for the              benefit of Lender encumbering the San Antonio Property (the "Spectrum DOT";              and together with the 11211 DOT collectively referred to herein as the "Initial              Deeds of Trust");                    (e)   Environmental Indemnity Agreement executed by the Loan Parties              for the benefit of Lender (the "Initial EIA");                      (f)   Guaranty executed by Guarantor in favor of Lender (the "Initial              Guaranty");                                         8                      6502991 V5 (78055.00001.000) 

 

                  (g)   Affidavit of Lou Fox regarding the Loan Parties and Initial              Properties (the "Initial Affidavit");                    (h)   UCC-1 Financing Statements authorized by Hartman Spectrum              and Hartman 11211, as debtors, to Lender, as secured party; and                     (i)   Unanimous consents, resolutions and certificates of officers for              each Loan Party and Hartman Income REIT  Management,  Inc., a Texas              corporation ("Manager"), which Manager is the limited liability company              manager for both Hartman Spectrum and Hartman 11211 pursuant to their              separate operating agreements (collectively, the "Initial Consents and Officer's              Certificates").   The documents listed in subclauses (a)-(i) immediately preceding are hereinafter referred to as  the "Initial Loan Documents" and the Loan Parties agree that the Initial Loan Documents are part  of and also contained within the meaning of the defined term "Loan Documents".        2.4   Procedures for to obtain Advances of the Remaining Committed Sum.               (a)   The Loan Parties and Lender acknowledge that the Note is a revolving   promissory note and, pursuant to the terms of the Note, the amount of the Remaining   Committed Sum which has not been Advanced may (i) increase as Advances are made under   the Note and (ii) decrease as principal payments (including, but not limited to, principal   payments made under the partial release provisions of Article Seven of this Agreement) are   received by Lender from Borrowers or Additional Borrowers.               (b)   The Loan Parties and Lender agree that no Advances under the Loan   may be requested by Borrowers or Additional Borrowers for purposes other than Operation   Purposes and/or Acquisition/Refinance Purposes.        2.5   Conditions to each Advance for an Operational PurposeBorrowers and Additional   Borrowers may, pursuant to the terms of the Note, apply for Advances of the Remaining   Committed Sum for the purpose of funding (i) operational needs for the Initial Properties, (ii)   operational needs for additional Properties which, subject and pursuant to the terms of this   Agreement, become Mortgaged Properties, and (iii) general corporate purposes of the   Borrowers and Additional Borrowers (the purposes in sub-clauses (i) through (iii) immediately   above being herein referred to collectively as, "Operational Purposes").               (b)   Provided (i) there is no Default then existing, (ii) there is no breach then   existing by any Loan Party under the Note, this Agreement, any Deed of Trust or any other   Loan Document for which a cure period is allowed under any of the Loan Documents but such   breach has not yet been cured by Borrowers or Additional Borrowers (a "Breach"), (ii) the then   current ICR for all of the Mortgaged Properties does not then exceed 1.50 and the drawing of   the requested Advance or re-advance under the Note will not cause the ICR to exceed 1.50; (iv)                                          9                      6502991 V5 (78055.00001.000) 

 

 each of the Loan Parties and Additional Borrowers executes and delivers to Lender a letter   requesting an Advance or re-advance under the Note in the form of Exhibit D attached hereto   and made part hereof (an "Operational Draw Request"), (v) the amount requested by Borrowers  and Additional Borrowers for an Advance or re-advance when added to the unpaid principal   balance of the Note then outstanding does not exceed the Committed Sum in the aggregate, and   (vi) the liens and security interests of the Deeds of Trust and other Loan Documents   encumbering the Mortgaged Properties have not been released or terminated for any reason,   except as permitted under Article Seven of this Agreement, Borrowers and Additional may   request advances and, in accordance with the provisions of the Note, make payments from time   to time.  The unpaid balance of the Note shall increase and decrease with each new Advance or   payment thereunder, as the case may be.  The Note shall not be deemed terminated or canceled   prior to the date of its maturity, although the entire principal balance thereof may from time to   time be paid in full.         (c) Each Advance under this Section 2.5 shall be deemed to be a representation and   warranty by the Borrowers and Additional Borrowers to Lender that the conditions specified in   this Section 2.5 have been satisfied on or prior to the date of the applicable Advance        2.6   Conditions to each Advance for an Acquisition/Refinance Purpose.  Borrowers  and Additional Borrowers may, in addition to Advances for Operational Purposes, apply for  Advances of the Remaining Committed Sum for Acquisition/Refinance Purposes. As conditions  precedent to Lender funding any Advance to the Borrowers and Additional Borrowers for an  Acquisition/Refinance Purpose, in addition to all other requirements herein, the Loan Parties and  the Additional Borrower which desires to purchase or re-finance a Prospective Property must, for  each Prospective Property, deliver to Lender: (i) no later than thirty (30) days prior and no longer  than 90 days prior to the scheduled Prospective Property Closing Date for a Prospective  Property, an Application for Advance which must (A) satisfy the following below listed  requirements of this Section 2.6 and (B) contain all of the items listed in Exhibit A attached  hereto and made part hereof, including, but not limited to a Request for Advance for  Acquisition/Refinance Purpose in the form of Exhibit E attached hereto and made part hereof for  all purposes, each of which items must be in form and substance acceptable to Lender, in  Lender's sole discretion; and (ii) on or prior to the Closing Date, all of the documents, items and  materials listed in Exhibit B attached hereto and made part hereof for all purposes (the "Closing  Deliveries").  All conditions precedent to the obligation of Lender to make any Advances for an  Acquisition/Refinance Purpose are imposed solely for the benefit of Lender.  The following are  additional conditions to each Advance for an Acquisition/Refinance Purpose which Lender, at  Lender's option, may waive any of the following or elect not to require any of the following:                 (a)   No Advance for a Prospective Property for an Acquisition/Refinance   Purpose shall be made if the Prospective Property, on the Submission Date, has an ICR of   more than 1.50 for the twelve (12) month period immediately preceding the Submission Date;               (b)   No Advance for a Prospective Property for an Acquisition/Refinance   Purpose shall be made: (i) for more than the Maximum Property Advance Amount for the   Prospective Property which is the subject of the Application for Advance submitted to Lender                                          10                     6502991 V5 (78055.00001.000) 

 

by Borrowers and Additional Borrowers: or (ii) if, on the Prospective Property Closing Date,  the amount of such requested Advance, when added to the outstanding principal balance of the  Note on Prospective Property Closing Date will cause the outstanding principal balance of the  Note to exceed the Committed Sum.              (c)   The funding of an Advance for an Acquisition/Refinance Purpose shall  only occur on the applicable Prospective Property Closing Date.              (d)   There shall then exist no Default under any Loan Document, including,  but not limited to, the Initial Loan Documents, nor shall there have occurred any event which  with the giving of notice or the lapse of time, or both, could become a Default;              (e)   The representations and warranties made in this Agreement and in each  Loan Document, including, but not limited to, the Initial Loan Documents, shall be true and  correct:                    (i)   on and as of the date on which such representation was made under             such Loan Documents, on the date the Application for Advance is submitted to             Lender and on the date of each Advance, and such submission of an Application             for Advance by the Loan Parties shall constitute the representation and warranty             by Loan Parties that such representations and warranties are true and correct at             such times as to the Loan Parties;                   (ii)  regarding each new Additional Borrower on the date the             Application for Advance is submitted to Lender by such new Additional             Borrower and on the date of each Advance, and such submission of an             Application for Advance by such Additional Borrower shall constitute the             representation and warranty by such  Additional Borrower that such             representations and warranties are true and correct at such times as to such             Additional Borrower.              (f)   Such Application for Advance submitted by Borrowers and Additional  Borrowers to Lender must be (a) actually received by Lender at Lender's office address set  forth in the introductory paragraph of this Agreement or by Lender's attorneys at such  attorneys' office and (b) Lender and its attorneys have reviewed and approved such Application  for Advance, including, but not limited those items listed on Exhibit A attached hereto;              (g)   Lender and its attorneys have (i) received from Borrowers and  Additional Borrowers on or prior to the scheduled Prospective Property Closing Date all of the  Closing Deliveries, originally executed by the Loan Parties and Additional Borrowers as  applicable, at such parties' sole cost and expense and (ii) reviewed and approved such Closing  Deliveries, including, but not limited those items listed on Exhibit B attached hereto;                                        11                     6502991 V5 (78055.00001.000) 

 

             (h)   Borrowers and Additional Borrowers have contributed Borrower's   Equity to the purchase or re-finance of the Prospective Property for which such Advance is   sought prior to or simultaneously with the Advance of Loan funds under this Agreement to   purchase or re-finance such Prospective Property;               (i)   All proceeds of previous Advances shall have been spent or used only   for the Operational Purposes, as set forth in the Operational Draw Request, or   Acquisition/Refinance Purposes as set forth in the Applications for Advance for the applicable   Prospective Property.                (j)   The physical condition of the Prospective Property, the status of title of   the Prospective Property, the appraised fair market value of the Prospective Property and all   other physical, legal, financial and other due diligence of any kind regarding the Prospective   Property, including, but not limited to all of the items listed on Exhibits A and B attached   hereto, reviewed by Lender or its attorneys must be acceptable to Lender in its sole discretion.         Each Advance under this Section 2.6 shall be deemed to be a representation and warranty  by the Borrowers and Additional Borrowers to Lender that the conditions specified in this  Section 2.6 have been satisfied on or prior to the date of the applicable Advance.        2.7   No Waiver.  No Advance shall constitute a waiver of any condition precedent to  the obligation of Lender to make any further Advance or preclude Lender from thereafter  declaring the failure of Borrowers and Additional Borrowers to satisfy such condition precedent  to be a Default.  Lender shall have no obligation to make any Advance or part thereof during the  existence of any Default or during the occurrence of any event which with the giving of notice or  the lapse of time, or both, could become a Default, but shall have the right and option to do so;  provided that if Lender elects to make any such Advance, no such Advance shall be deemed to  be either a waiver of the right to demand payment of the Loan, or any part thereof, or an  obligation to make any other Advance.                                         12                     6502991 V5 (78055.00001.000) 

 

                              ARTICLE THREE                             OPERATING ACCOUNTS        Borrowers and Additional Borrowers covenant and agree with Lender that, so long as any  amount of the Loan or any obligation of Lender to make any Advances under this Agreement,  the Note or any other Loan Documents still remains outstanding, to induce Lender to establish  the interest rates provided for in the Note, and if and to the extent permitted by applicable laws,  Borrowers and all Additional Borrowers shall use and maintain Lender as its principal  depository, including for the maintenance of business, cash management, operating and  administrative deposit accounts.  For all sums due and payable under the Loan, Lender shall have  the right of setoff against any and all sums contained in any such account.                                 ARTICLE FOUR                             NEGATIVE COVENANTS        4.1   No Disposition or Subordinate Lien Instruments. Borrowers and all Additional  Borrowers will not:               (a)   cause or allow, other than as permitted under Article Seven below, a   Disposition to occur without obtaining Lender's prior written consent to the Disposition.               (b)   Borrowers and all Additional Borrowers will not create, place or permit   to be created or placed or through any act or failure to act, acquiesce in the placing of, or allow   to remain any Lien regardless of whether such Lien is expressly subordinate to the liens or   security interests of the Loan Documents with respect to a Mortgaged Property or any part   thereof, other than Permitted Encumbrances shown and listed in the Title Policy for such   Mortgaged Property.               (c)   Borrowers and all Additional Borrowers will not create, place or permit   to be created, or placed or through any act or failure to act, acquiesce in the placing of, or allow   to remain, any subordinate financing secured by any limited liability company interests,   partnership interests, stock or shareholder interest in Borrowers or any Additional Borrowers,  including, without limitation, a pledge or similar encumbrance of the direct or indirect   ownership interest in  any Borrowers or any Additional Borrowers.               (d)   Borrowers and all Additional Borrowers will not enter into any other   title encumbrance of any nature whatsoever against all or any portion of a Mortgaged Property   absent obtaining the prior written consent of Lender including, without limitation, any   restrictive covenants, condominium declaration, plat, zoning or use restriction, easement or   license; provided, however, such consent will not be required for any utility easement granted   by Borrowers or any Additional Borrowers to any utility company for an utility easement   which runs along the edges of a Mortgaged Property and does not run under any building.                                         13                     6502991 V5 (78055.00001.000) 

 

                               ARTICLE FIVE                                    DEFAULT        The term "Default," as used herein and in the other Loan Documents, shall mean and  include the occurrence of any one or more of the following events listed in Sections 5.1 (a)-(c) below:        5.1   Subject to the "PROVIDED HOWEVER" clause set forth below, upon:               (a)   any Loan Party's or Additional Borrower's breach of any representation,   warranty, covenant or agreement of any Loan Party or Additional Borrower under this   Agreement, the Note, any Deed of Trust (notwithstanding any provision contained in any Loan   Document to the contrary, for the purposes of this Section 5.1, if, at any time prior to the Loan   being paid in full and Lender having no further obligations to fund any further Advances under   this Agreement or the Note there then exists no current effective Deed of Trust encumbering a   Mortgaged Property, the representations, warranties, covenants and agreements concerning the   Loan Parties (and not a particular Property) contained in the Initial Deeds of Trust shall be   deemed to still survive and be effective against such Loan Parties until the Loan is paid in full   and Lender has no further obligations to fund any further Advances under this Agreement or   the Note (e.g., a failure of the Loan Parties to comply with their covenant to provide annual   reports described in Paragraph 10 of the Initial Deeds of Trust or a breach by any of the Loan   Parties of Paragraph 18 (insolvency) in the Initial Deeds of Trust), or any other Loan   Document, including but not limited to, the covenants to pay when due any sums owing under   the Note, this Agreement, the Deeds of Trust or any other Loan Document within ten (10) days   after such sums shall fall due (such ten day period applying only to covenants to pay monetary   sums due under any of the Loan Documents); or                (b)   a material adverse change occurs in any Loan Party's or Additional   Borrower's financial condition or business which causes Lender, in Lender's commercially   reasonable opinion, to believe that the prospect of (A) the payment of the indebtedness   evidenced by the Note or any other sum secured by the Loan Documents, or (B) the   performance of any Loan Party's or Additional Borrower's other obligations under any of the   Loan Documents is materially and adversely impaired; or               (c)   the occurrence of any breach or default by Borrowers or any Additional   Borrowers under any REA (as defined in a Deed of Trust) which could cause a termination of   any REAs or the rights of any Borrowers or Additional Borrowers under any REA or the  amendment, termination or surrender of any REA without Lender's prior written consent.     Upon Default, Lender at Lender's option may (i) declare all unpaid principal and interest under   the Note together with all other sums owing by any of the Borrowers, Additional Borrowers or   the Guarantor under any of the Loan Documents to be immediately due and payable without   further demand, (ii) terminate all obligations of Lender to make further Advances under this   Agreement and the Note and (iii) may invoke the power of sale and any other remedies                                          14                     6502991 V5 (78055.00001.000) 

 

 permitted by applicable law or provided herein or in any of the Deeds of Trust or any of the   other Loan Documents;   PROVIDED, HOWEVER,         (1)   if such breach of any representation, covenant or agreement is other than (x) a  breach of any representation, covenant or agreement contained in Paragraphs 2, 4, 5, 7(a)-(x), 18,  19 or 37 of any Deed of Trust or (y) a breach of any Loan Party's or Additional Borrower's  obligation to pay money in accordance with the terms of the Note, this Agreement, any of the  Deeds of Trust or any other Loan Document, such breach shall NOT constitute a Default unless  Lender has provided written notice to the Loan Parties and then current Additional Borrowers describing such breach and the Loan Parties and then current Additional Borrowers have not  cured such breach to Lender's sole satisfaction within thirty (30) days after the date of such  written notice from Lender or within such longer period of time, not to exceed an additional  thirty (30) days, as may be reasonably necessary to cure such non-compliance if the Loan Parties or then current Additional Borrowers have commenced such cure within such initial thirty (30)  day period and are diligently and with continuity of effort pursing such cure, and         (2)   during any such cure period provided in subclause (1) immediately preceding,  until such breach is cured to Lender's sole satisfaction, Borrowers shall not be permitted to draw  any Advance or re-Advance under the Note, this Agreement or any other Loan Document.  The  Loan Parties and all Additional Borrowers acknowledge (x) that the power of sale herein granted  may be exercised by Lender without prior judicial hearing and (y) that Lender may exercise  other remedies under other Loan Documents in addition to the remedies under the Note, this  Agreement, any of the Deeds of Trust and any other Loan Document and all such remedies shall  be cumulative and not exclusive.  Lender shall be entitled to collect all reasonable costs and  expenses incurred in pursuing such remedies, including, but not limited to, attorney's fees and  costs of documentary evidence, abstracts and title reports.                                  ARTICLE SIX                  CERTAIN RIGHTS AND REMEDIES OF LENDER        6.1   Rights Upon Default.  If any Default shall occur and be continuing or upon the  final maturity of the Note, Lender may, without notice, terminate its commitment to Advance  and declare the Loan and all sums owing under the Note, this Agreement, any of the Deeds of  Trust or any other Loan Document or any part thereof to be immediately due and payable, and  the same shall thereupon become immediately due and payable, without notice, demand,  presentment, notice of dishonor, notice of acceleration, notice of intent to accelerate, notice of  intent to demand, protest, or other formalities of any kind, all of which are hereby expressly  waived by the Loan Parties and Additional Borrowers; provided, however, that upon the  occurrence of an of Default under Paragraphs 18 or 19 of any Deed of Trust, Lender's  commitment to Advance shall automatically terminate, and the Loan and all sums owing under  the Note, this Agreement, any of the Deeds of Trust or any other Loan Document or any part  thereof shall become immediately due and payable without notice, demand, presentment, notice                                          15                     6502991 V5 (78055.00001.000) 

 

of dishonor, notice of acceleration, notice of intent to accelerate, notice of intent to demand,  protest, or other formalities of any kind, all of which are hereby expressly waived by the Loan  Parties and all Additional Borrowers.  If any Default shall occur and be continuing, Lender may  exercise all rights and remedies available to it in law or in equity, under the Loan Documents, or  otherwise.                                ARTICLE SEVEN                               PARTIAL RELEASES        7.1   Upon consummation of the sale of a Mortgaged Property (but not a sale of only a  portion of a Mortgaged Property), the Borrower or Additional Borrower which owns the  Mortgaged Property (the "Selling Borrower") shall be entitled to a partial release of the Lien of  the Deed of Trust (the "Release DOT") encumbering for such Mortgaged Property covered by  such sale (a "Release Tract") upon and subject to the following terms and conditions:        7.2   At least thirty (30) but not more than ninety (90) days prior to the date of any  requested partial release, the Selling Borrower shall deliver to Lender (i) a written request  ("Selling Borrower's Release Request") identifying the Release Tract to be sold, the closing date  of the sale of the Release Tract (the "Release Date"), and the Release Price (as hereinafter  defined) for the Release Tract to be paid by Selling Borrower to Lender on the Note, (ii) a fully  executed copy of the contract of sale covering the Release Tract (the "Sales Contract") and (iii)  the remaining Borrowers and Additional Borrowers shall deliver to Lender a written certificate certifying to Lender that the remaining Mortgaged Properties not being released per the Selling  Borrowers' Release Request and which are to remain under the Lien of the Deeds of Trust not  being released (the "Remaining Tracts") will have, in the aggregate, immediately following the Release Date, an aggregate ICR of 1.50 or greater.        7.3   On the Release Date which Selling Borrower has requested the release of the  Release Tract to occur, Selling Borrower shall pay to the Lender in immediately available United  States funds by federal funds wire transfer (at the same wire address Borrowers and Additional  Borrowers make payments under the Note or at any other wire address pursuant to written wire  instructions provided by Lender): (x) the Lender's Release Costs (as hereinafter defined), plus (y)  the Release Price, which amounts in clauses (x) and (y) above will first be applied against the  against Lender's Release Cost and then against the unpaid principal amount of the Note.  The  "Release Price" for a Release Tract shall equal as per any given Release Date, the greater of (1)  the gross sales price for the Release Tract as shown on the Sales Contract and confirmed by the  Closing Statement (as defined below), less customary reasonable closing costs not to exceed  eight percent (8%) of the gross sales price for the Release Tract as shown on the Sales Contract  and confirmed by the Closing Statement and (2) the following amounts for each Property as  follows:    Name of Property and Street Address                Release Price                                         16                     6502991 V5 (78055.00001.000) 

 

Hartman Spectrum                                          $ 613 Northwest Loop 410 San Antonio, Texas  78216  Hartman 11211                                        $2,550,000.00 11211 Katy Freeway Houston, Texas 77079  Borrower will confirm the Release Price by delivering a copy of the fully executed closing  statement for the sale of such Release Tract (the "Closing Statement") to Lender simultaneously  with the closing of the sale of the Release Tract and the payment of the Release Price.        7.4   Notwithstanding anything contained to the contrary in Sections 7.2 or 7.3 above,  in the event that at the time a Selling Borrowers' Release Request is received by Lender or on the  Release Date on which the release is to occur (i) there then exists a Default under any Loan  Document, including, but not limited to, the Initial Loan Documents (as defined in Section 2.3),  or if there has occurred any event which with the giving of notice or the lapse of time, or both,  could become a Default hereunder or under any of the other Loan Documents or (ii) the  Borrowers and Additional Borrowers, as a result of such partial release, will not have, in the  aggregate, an ICR of 1.50 or greater on the Remaining Tracts immediately following such  release, then Selling Borrower shall not be entitled to receive a release of a Release Tract.         7.5   Selling Borrower, together with the Release Price, shall simultaneously pay to  Lender, Lender's cost of preparing the partial release and any out-of-pocket expenses of Lender  (including, but not limited to, reasonable attorney's fees and costs) in connection with any partial  release of a Release Tract(s) (collectively, "Lender's Release Costs"). Such partial release shall  be held by a title company or closing attorney acceptable to Lender, in Lender's sole discretion,  in escrow to be delivered to Selling Borrower only upon payment to Lender, in accordance with  the provisions of this Article Seven, of the Release Price and the Lender's Release Costs.                                ARTICLE EIGHT                                MISCELLANEOUS        8.1   Notices.  If no Deed of Trust is then in effect encumbering a Mortgaged Property,  then unless otherwise expressly provided herein, all notices and other communications provided  for hereunder shall be in writing and mailed or delivered, to the address specified for notices on  the signature page below or to such other address as shall be designated by such party in a notice  to the other parties.  All such other notices and other communications shall be deemed to have  been given or made upon the earliest to occur of (a) actual receipt by the intended recipient, or  (b) (i) if delivered by hand or courier, when signed for by the designated recipient, (ii) if  delivered by mail, upon deposit in the mail, postage prepaid, and (iii) if delivered by an  overnight nationally recognized courier, such as FedEx or UPS, upon deposit, postage prepaid,  with such courier.  Electronic mail and internet websites may be used only to distribute routine                                          17                     6502991 V5 (78055.00001.000) 

 

communications, such as Financial Statements and other information, and to distribute Loan  Documents for execution by the parties thereto, and may not be used for any other purpose. A  notice may be sent by a party's attorney on such party's behalf.        8.2   Guarantor as Agent for Borrower  .  Borrowers and Additional Borrowers hereby irrevocably appoint Guarantor as the borrowing  agent and attorney-in-fact for the Borrowers and Additional Borrowers (the “Administrative  Borrower”), which appointment shall remain in full force and effect unless and until Lender shall  have received prior written notice signed by Borrowers and Additional Borrowers that such  appointment has been revoked and a Borrower or Additional Borrower has been appointed  Administrative Borrower. Borrowers and Additional Borrowers hereby irrevocably appoint and  authorize the Administrative Borrower (i) to provide Lender with all notices with respect to Loan  obtained for the benefit of Borrowers and Additional Borrowers and all other notices and  instructions under this Agreement and (ii) to take such action as the Administrative Borrower  deems appropriate on its behalf to obtain Loan and to exercise such other powers as are  reasonably incidental thereto to carry out the purposes of this Agreement; provided, however, all  Requests for Advance and Operational Draw Requests must be executed by all of the parties  shown on their respective exhibits attached hereto. Borrowers and Additional Borrowers hereby  jointly and severally agrees to indemnify and hold Lender harmless against any and all liability,  expense, loss or claim of damage or injury, made against Lender by any Borrower or Additional  Borrower or Guarantor or any third party whatsoever, arising from or incurred by reason of (a)  Lender’s reliance on any instructions from the Administrative Borrower, or (b) any other action  taken by Lender hereunder or under the other Loan Documents.         8.3   Maximum  Interest.  It is expressly stipulated and agreed to be the intent of  Borrowers and Additional Borrowers and Lender at all times to comply strictly with the  applicable Texas law governing the maximum rate or amount of interest payable on the  indebtedness evidenced by the Note or any other Loan Document (or applicable United States  federal law to the extent that it permits Lender to contract for, charge, take, reserve or receive a  greater amount of interest than under Texas law).  If the applicable law is ever judicially  interpreted so as to render usurious any amount (a) contracted for, charged, taken, reserved or  received pursuant to the Note, any of the other Loan Documents or any other communication or  writing by or between Borrowers and Additional Borrowers and Lender related to the transaction  or transactions that are the subject matter of the Loan Documents, (b) contracted for, charged,  taken, reserved or received by reason of Lender's exercise of the option to accelerate the maturity  of the Note and/or any and all indebtedness paid or payable by Borrowers and Additional  Borrowers to Lender pursuant to any Loan Document other than the Note, or (c) Borrowers or  Additional Borrowers will have paid or Lender will have received by reason of any prepayment  by Borrowers and Additional Borrowers of the Note, then it is Borrowers and Additional  Borrowers' and Lender's express intent that all amounts charged in excess of the Maximum  Lawful Rate shall be automatically canceled, ab initio, and all amounts in excess of the  Maximum Lawful Rate theretofore collected by Lender shall be credited on the principal balance  of the Note (or, if the Note has been or would thereby be paid in full, refunded to Borrower), and  the provisions of the Note and the other Loan Documents shall immediately be deemed reformed  and the amounts thereafter collectible hereunder and thereunder reduced, without the necessity of                                          18                     6502991 V5 (78055.00001.000) 

 

the execution of any new document, so as to comply with the applicable law, but so as to permit  the recovery of the fullest amount otherwise called for hereunder and thereunder; provided,  however, if the Note has been paid in full before the end of the stated term of the Note, then  Borrowers and Additional Borrowers and Lender agree that Lender shall, with reasonable  promptness after Lender discovers or is advised by Borrower that interest was received in an  amount in excess of the Maximum Lawful Rate, either refund such excess interest to Borrowers  and Additional Borrowers  and/or credit such excess interest against the Note then owing by  Borrowers and Additional Borrowers to Lender. Borrowers and Additional Borrowers hereby  agree that as a condition precedent to any claim or counterclaim (in which event such proceeding  shall be abated for such time period) seeking usury penalties against Lender, Borrowers and  Additional Borrowers will provide written notice to Lender, advising Lender in reasonable detail  of the nature and amount of the violation, and Lender shall have sixty (60) days after receipt of  such notice in which to correct such usury violation, if any, by either refunding such excess  interest to Borrowers and Additional Borrowers or crediting such excess interest against the Note  to which the alleged violation relates.  All sums contracted for, charged, taken, reserved or  received by Lender for the use, forbearance or detention of any debt evidenced by the Note shall,  to the extent permitted by applicable law, be amortized or spread, using the actuarial method,  throughout the stated term of the Note (including any and all renewal and extension periods)  until payment in full so that the rate or amount of interest on account of the Note does not exceed  the Maximum Lawful Rate from time to time in effect and applicable to the Note for so long as  debt is outstanding.  In no event shall the provisions of Chapter 346 of the Texas Finance Code  which regulates certain revolving credit loan accounts and revolving triparty accounts apply to  the Note. Notwithstanding anything to the contrary contained herein or in any of the other Loan  Documents, it is not the intention of Lender to accelerate the maturity of any interest that has not  accrued at the time of such acceleration or to collect unearned interest at the time of such  acceleration.        8.4   Invalid Provisions.  If any provision of any of the Loan Documents is held to be  illegal, invalid, or unenforceable under present or future laws effective during the term thereof,  such provision shall be fully severable, the appropriate Loan Document shall be construed and  enforced as if such illegal, invalid, or unenforceable provision had never comprised a part  thereof; and the remaining provisions thereof shall remain in full force and effect and shall not be  effected by the illegal, invalid, or unenforceable provision or by its severance therefrom.   Furthermore, in lieu of such illegal, invalid, or unenforceable provision, there shall be added  automatically as a part of such Loan Document a provision as similar in terms to such illegal,  invalid, or unenforceable provision as may be possible and be legal, valid, and enforceable.        8.5   Entirety and Amendments.  This instrument embodies the entire agreement  between the parties relating to the subject matter hereof (except documents, agreements and  instruments delivered or to be delivered in accordance with the express terms hereof), supersedes  all prior agreements and understandings, if any, relating to the subject matter hereof, and may be  amended only by an instrument in writing executed jointly by the Loan Parties and Additional  Borrowers and Lender and supplemented only by documents delivered or to be delivered in  accordance with the express terms hereof.                                         19                     6502991 V5 (78055.00001.000) 

 

      8.6   Multiple Counterparts.  This Agreement has been executed in a number of  identical counterparts, each of which constitutes an original and all of which constitute,  collectively, one agreement; but in making proof of this Agreement, it shall not be necessary to  produce or account for more than one such counterpart.        8.7   Parties Bound.  This Agreement shall be binding upon and inure to the benefit of  Loan Parties and Additional Borrowers, Lender and their respective successors and assigns;  provided that Loan Parties and Additional Borrowers may not, without the prior written consent  of Lender, assign any of its rights, duties, or obligations hereunder.  No term or provision of this  Agreement shall inure to the benefit of any Person other than the Loan Parties and Additional  Borrowers and Lender and their respective successors and assigns; consequently, no Person other  than Loan Parties and Additional Borrowers and Lender and their respective successors and  assigns, shall be entitled to rely upon, or to raise as a defense, in any manner whatsoever, the  failure of the Loan Parties and Additional Borrowers or Lender to perform, observe, or comply  with any such term or provision.        8.8   Lender's Consent or Approval.  Except where otherwise expressly provided in the  Loan Documents, in any instance where the approval, consent or the exercise of judgment of  Lender is required, the granting or denial of such approval or consent and the exercise of such  judgment shall be (a) within the sole discretion of Lender, and (b) deemed to have been given  only by a specific writing intended for that purpose and executed by Lender.  Each provision for  consent, approval, inspection, review, or verification by Lender is for Lender's own purposes and  benefit only.        8.9   Sale of Loan and Participations.  Lender may, from time to time and without  notice to Loan Parties or Additional Borrowers, sell or offer to sell the Loan, or interests therein,  to one or more assignees or participants and Lender is hereby authorized to disseminate and  disclose any information (whether or not confidential or proprietary in nature) Lender now has or  may hereafter obtain pertaining to Loan Parties and Additional Borrowers, any other Obligated  Party, the Loan or the Loan Documents (including, without limitation, any credit or other  information regarding Loan Parties and Additional Borrowers, any of its principals, or any other  person or entity liable, directly or indirectly, for any part of the Loan, to (a) any assignee or  participant or any prospective assignee or prospective participant, (b) any regulatory body having  jurisdiction over Lender or the Loan, and (c) any other persons or entities as may be necessary or  appropriate in Lender's reasonable judgment).  Lender, as a courtesy to Loan Parties and  Additional Borrowers, will endeavor to notify Loan Parties and Additional Borrowers of any  such assignees or participants, or prospective assignees or participants, to which Lender  disseminates any of the information described above.        8.10  Loan Agreement Governs.  In the event of any conflict between the terms of this  Agreement and any terms of any other Loan Document, the terms of this Agreement shall  govern.  All of the Loan Documents are by this reference incorporated into this Agreement.        8.11  WAIVER  OF JURY  TRIAL.  TO THE  FULLEST  EXTENT   PERMITTED   BY  APPLICABLE  LAW,  THE  LOAN  PARTIES  AND  ADDITIONAL   BORROWERS     HEREBY                                          20                     6502991 V5 (78055.00001.000) 

 

IRREVOCABLY AND EXPRESSLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY  ACTION, PROCEEDING, OR COUNTERCLAIM (WHETHER BASED UPON CONTRACT,  TORT, OR  OTHERWISE)   ARISING  OUT  OF OR  RELATING   TO ANY   OF THE  LOAN  DOCUMENTS     OR  THE   TRANSACTIONS     CONTEMPLATED     THEREBY    OR   THE  ACTIONS    OF   LENDER    IN   THE    NEGOTIATION,    ADMINISTRATION,      OR  ENFORCEMENT THEREOF.        8.12  GOVERNING     LAW;   PLACE   OF   PERFORMANCE.       THE    LOAN  DOCUMENTS ARE BEING EXECUTED AND DELIVERED, AND ARE INTENDED TO BE  PERFORMED, IN THE STATE OF    TEXAS, AND THE   LAWS OF SUCH STATE AND OF  THE UNITED STATES SHALL GOVERN THE RIGHTS AND DUTIES OF THE PARTIES  HERETO    AND    THE    VALIDITY,    CONSTRUCTION,     ENFORCEMENT,      AND  INTERPRETATION    OF  THE  LOAN   DOCUMENTS,    VENUE   OF  ANY   LITIGATION  INVOLVING    THIS  AGREEMENT      OR   ANY   LOAN    DOCUMENT     SHALL    BE  MAINTAINED   IN  AN  APPROPRIATE   STATE   OR  FEDERAL COURT     LOCATED   IN  DALLAS  COUNTY,   TEXAS  OR  HARRIS  COUNTY,   TEXAS,  TO THE  EXCLUSION   OF  ALL OTHER VENUES.          8.13  WAIVER    OF   CONSEQUENTIAL,     PUNITIVE   AND    SPECULATIVE  DAMAGES.   THE  LOAN   PARTIES  AND  ADDITIONAL    BORROWERS    AND   LENDER  AGREE   THAT,  IN CONNECTION     WITH   ANY  ACTION,   SUIT  OR  PROCEEDING  RELATING  TO  OR  ARISING  OUT  OF THIS AGREEMENT     OR ANY   OF THE  OTHER  LOAN   DOCUMENTS,    EACH   MUTUALLY     WAIVES   TO  THE   FULLEST   EXTENT  PERMITTED   BY APPLICABLE   LAW  ANY  CLAIM   FOR CONSEQUENTIAL,    PUNITIVE  OR SPECULATIVE DAMAGES.             [Balance of Page Intentionally Left Blank. Signature Pages Follow.]                                         21                     6502991 V5 (78055.00001.000) 

 

 

 

 

 

BANK:   EAST WEST BANK,  a California state-chartered bank   By:  Name:  Esau Liu  Title: S <1-f?   Address for Notices:   9090 Katy Freeway, 3rd Floor  Houston, Texas 77024  Attn: Mr. Esau Liu  Facsimile No.: --------    EWB MASTER CREDIT FACILITY AGREEMENT                                    [SIGNATURE PAGE]                6502991 (78055.00001000)  

 

                                 EXHIBIT A     APPLICATION FOR ADVANCE FOR ACQUISITION/REFINANCE PURPOSE  Request for Advance signed by all Loan Parties and the Additional Borrower desiring to  purchase a Prospective Property.  A copy of the Purchase Contract for the Prospective Property together with all amendments  thereto (this requirement will not be necessary for a refinance of a Prospective Property and not  an acquisition of a Prospective Property).  Financial Statements regarding the new Additional Borrower and updated Financial Statements  regarding the Loan Parties, which Financial Statements will use the same form as previously  submitted by the Loan Parties at the origination of the Loan.  Evidence reasonably satisfactory to Lender that the Prospective Property, on the Submission  Date, has an ICR of 1.50 or more for the twelve (12) months immediately preceding the  Submission Date.  A copy of the organizational documents for the new Additional Borrower (e.g., articles of  formation, limited liability operating agreements, articles of incorporation, by-laws, etc.)  Current bankruptcy, federal tax lien and judgment searches and searches of all UCC records in  the County where a Prospective Property is located and an Additional Borrower is formed or  incorporated, demonstrating the absence of adverse claims.  An appraisal of the Prospective Property by a qualified MAI appraiser approved by Lender, in  form, scope and substance satisfactory to Lender, showing the fair market value of the  Prospective Property.  An inspection of and acceptable report on the buildings and other improvements located on such  Prospective Property in form and substance and by an engineer acceptable to Lender in Lender's  sole discretion, at Borrowers' and Additional Borrowers' sole cost and expense.  Satisfactory evidence of the compliance of the Prospective Property with The Americans with  Disabilities Act of 1990, as amended, similar state laws, and any regulations promulgated  pursuant thereto, as amended.  An environmental report prepared at Borrowers' and Additional Borrowers' expense by a  qualified environmental consultant approved by Lender, dated not more than three months prior  to the Prospective Property Closing Date and addressed to Lender (or subject to separate letter  agreement permitting Lender to rely on such environmental report), which report shall, at a   EXHIBIT A                                                              6502991 v5 (78055.00001.000) 

 

minimum, (A) demonstrate the absence of any existing or potential hazardous material  contamination or violations of environmental laws at, on, under or above the Prospective  Property, except as acceptable to Lender in its sole and absolute discretion, (B) include the  results of all sampling or monitoring to confirm the extent of existing or potential hazardous  material contamination at the Prospective Property, including the results of leak detection tests  for each underground storage tank located at the Prospective Property, if any, (C) describe  response actions appropriate to remedy any existing or potential hazardous material  contamination, and report the estimated cost of any such appropriate response, (D) confirm that  any prior removal of hazardous material or underground storage tanks from the Prospective  Property was completed in accordance with applicable Laws, and (E) confirm whether or not the  Prospective Property is located in a wetlands district.  A title commitment for a Title Policy covering the Prospective Property together with legible  copies of all exceptions to title listed in such commitment. Such title commitment must be in a  form that will result in a Title Policy in the amount of the Advance by Lender to purchase or  refinance the Prospective Property and meeting the requirements on Exhibit C attached hereto  being delivered to Lender on the Prospective Property Closing Date.  A Survey, bearing a date not earlier than 30 days prior to the Prospective Property Closing Date  and which must contain the following certification to Lender from the surveyor of the Survey:         "I hereby certify to East West Bank, its successors and assigns, [Additional Borrower]        and [name of Title Company] that: (a) the survey prepared by me entitled "[_________]"        (i) meets the Minimum Standard Detail Requirements (including, but not limited to, items        1, 2, 3, 4, 5, 6, 7(a), 7(b)(1), 7(c), 8, 9, 11, 13, 14, 16, 17, 18 and 19 of Table "A" thereof)        and the Accuracy Standards for ALTA/ACSM Land Title Surveys as adopted by the        American Land Title Association, the National Society of Professional Surveyors, and        the American Congress on Surveying and Mapping and in effect on the date of the        Survey; (b) said property described hereinabove has access to and from a public roadway        and (c) that the plat hereon is a true, correct and accurate representation of (i) the        property described hereinabove, and (ii) the exceptions to title listed in the Commitment        for Title Insurance issued by ______________________________ (their file No.        _______________________)."  Certificate of Occupancy and all other permits required by applicable law with respect to the use,  ownership, or operation of the Prospective Property.  Satisfactory evidence that all zoning ordinances or restrictive covenants affecting the Prospective  Property permit the present and intended uses of the Prospective a Mortgaged and have been and  will be complied with.  Satisfactory evidence (by way of utility letters or otherwise shown on the Survey) establishing to  the satisfaction of Lender that the Prospective Property has adequate water supply, storm and  sanitary sewerage facilities, telephone, gas, electricity, fire and police protection.   EXHIBIT A                                                              6502991 v5 (78055.00001.000) 

 

Satisfactory evidence (this may be evidenced on the Survey) that all of the streets providing  access to the Prospective Property have been either dedicated to public use or established by  private easement, duly recorded in the records of the county in which the Prospective Property is  located, and have been fully installed and accepted by the appropriate governmental authority,  that all costs and expenses of the installation and acceptance thereof have been paid in full and  that there are no restrictions on the use and enjoyment of such streets that adversely affect, limit  or impair the applicable Additional Borrower's ability to operate the Prospective Property for the  purposes and in the manner represented to Lender.  True, correct and complete copies of all tenant and other space leases encumbering any portion  of the Prospective Property on the Prospective Property Closing Date together with a copy of the  form of lease which the applicable Additional Borrower intends to utilize in connection with the  leasing of space in the Prospective Property.  Copies of any leasing, management and development agreements entered into or to be entered  into by applicable Additional Borrower in connection with the proposed operation of the  Prospect Property.   EXHIBIT A                                                              6502991 v5 (78055.00001.000) 

 

                                 EXHIBIT B                             CLOSING DELIVERIES  The following documents, items and materials are hereinafter collectively referred to as the  "Closing Deliveries":  A Joinder Agreement executed by the new Additional Borrower that is purchasing the Prospective Property and all Loan Parties and all then existing Additional Borrowers.  A Deed of Trust encumbering the Prospective Property, in the same form as the Initial Deeds of  Trust, executed, notarized and delivered by the Additional Borrower purchasing the Prospective Property and Hartman Partnership.  An environmental indemnity agreement executed by the new Additional Borrower that is  purchasing the Prospective, Hartman Partnership and Guarantor by for the benefit of Lender,  which agreement will be in the same form as the Initial EIA;    A Closing Affidavit executed by a senior officer of the Additional Borrower that is purchasing  the Prospective Property.  All other Loan Documents applicable to a Prospective Property reasonably requested by Lender.  Borrowers and Additional Borrowers shall provide to Lender evidence which is reasonably  satisfactory to Lender that the Additional Borrower that is purchasing a Prospective has  contributed Borrower's Equity toward acquisition of the Prospective Property.    Subordination, Non-Disturbance, and Attornment Agreements from each tenant under each lease  for such Prospective Property that has previously been requested by Lender.  Casualty, Commercial Liability and other Insurance Policies, certificates and binders insuring the  Prospective Property and Additional Borrower that is purchasing the Prospective Property,  meeting the same requirements as set forth in Section 5 of the Initial Deed of Trust.  The Survey for the Prospective Property, which has been previously reviewed and approved by  Lender's attorneys prior to the Prospective Property Closing Date.  The Title Policy, in the amount of the Advance by Lender to purchase or refinance the  Prospective Property insuring the Prospective Property, which has been previously reviewed and  approved by Lender's attorneys prior to the Prospective Property Closing Date.   EXHIBIT B                                                              6502991 v5 (78055.00001.000) 

 

A copy of the Closing Statement for the Prospective Property executed by both the seller and the  Additional Borrower purchaser of the Prospective Property.  A certificate of incumbency, in a form acceptable to Lender, of all agents of the entity who will  be authorized to execute any of the Loan Documents on behalf of the Loan Parties and the  applicable Additional Borrower, dated the Closing Date, and in a form acceptable to Lender.  A copy of resolutions of the Loan Parties and the applicable Additional Borrower that is a  corporation, limited liability company, partnership or other entity, approving and authorizing the  Loan Documents and the transactions contemplated by this Agreement, duly adopted by the  governing body of each such entity, accompanied by a certificate of an authorized representative  of each such entity, dated the Prospective Property Closing Date, that such copy is a true and  correct copy of resolutions duly adopted at a meeting of the governing body of each such entity  and that such resolutions have not been amended or revoked in any respect and are in full force  and effect as of the Prospective Property Closing Date.  Such other satisfactory evidence as Lender shall require that all necessary action on the part the  Loan Parties and the applicable Additional Borrower has been taken with respect to the  execution and delivery of the Closing Deliveries and the consummation of the transactions  contemplated hereby so that this Agreement will be valid and binding upon the Loan Parties and  the applicable Additional Borrower.  UCC-1  Financing Statements with respect to the security interests granted in the Loan  Documents, together with evidence of the priority of the respective security interests perfected  thereby.  The Additional Borrower hereby irrevocably authorizes Lender at any time and from  time to time to prepare and file one or more financing statements regarding the Prospective  Property, including any personal property in connection therewith and or such Additional  Borrower, together with all uniform commercial code UCC-3 continuation statements that may,  from time to time, be necessary to be filed of record to keep such financing statements from  terminating.  Payment by wire transfer to Lender and Lender's attorneys of (i) any third party costs incurred by  Lender such as report or search costs, (ii) all legal fees and expenses of Lender's attorneys in the  review of the Application for Advance and materials contained therein, the preparation and  negotiation of all closing documents and the closing of the Advance, and (iii) the payment of all  document recording fees and third party fees such as Title Policy premiums, Survey costs, etc.  Legal opinion letters from the counsel for the Loan Parties and Additional Borrowers in form  and substance acceptable to Lender and Lender's counsel covering the Loan Parties and  Additional Borrowers and the enforceability of each the documents listed above in this Exhibit B and any other new Loan Document being delivered on such Prospective Property Closing Date,  including, but not limited to, any Joinder Agreement, Deed of Trust, amend to this Agreement being executed and delivered on such Prospective Property Closing Date.   EXHIBIT B                                                              6502991 v5 (78055.00001.000) 

 

Such other materials, documents, papers or requirements regarding the Prospective Property, any  Loan Parties and Additional Borrowers or lease as Lender shall reasonably request.   EXHIBIT B                                                              6502991 v5 (78055.00001.000) 

 

                                 EXHIBIT C                         TITLE POLICY REQUIREMENTS   The Additional Borrower that is purchasing the Prospective Property shall deliver to Lender, at  such Additional Borrower's expense, for Texas property, a Texas loan policy of title insurance  (Form T-2), acceptable to Lender and Lender's counsel.  The Title Policy shall (a) show "East  West Bank, a California state-chartered bank" as the insured mortgagee, (b) insure the Lien of  the Deed of Trust to encumber the Prospective Property as a first lien against such Property in  the full amount of the Advance by Lender, (c) delete the exception for matters which a current  survey would show, and all "standard" exceptions which can be deleted, to the fullest extent  authorized under applicable title insurance rules and such Additional Borrower shall satisfy all  requirements therefor, (d) contain (i) no exception for standby fees or real estate taxes other than  standby fees and real estate taxes for the year in which the Prospective Property Closing Date  occurs to the extent the same are not then due and payable in which case the same shall be  endorsed "not yet due and payable" and (ii) no exception for subsequent assessments for prior  years, (e) provide full coverage against mechanic's liens to the extent authorized by applicable  title insurance rules and such Additional Borrower shall satisfy all requirements therefor, (f)  contain only such exceptions (regardless of rank or priority) Lender approves, and such  Additional Borrower shall cause to be delivered to Lender true, complete and fully legible copies  of all recorded instruments shown as exceptions, including the subdivision plat (if any) and any  restrictive covenants, (g) insure that no restrictive covenants shown in the Title Policy have been  violated, and that no violation of the restrictions will result in a reversion or forfeiture of title, (h)  insure that the lands shown in the required Survey are one and the same as the lands encumbered  by such Deed of Trust, and that all recorded easements and other exceptions locatable on the  ground are located as shown on the Survey, (i) insure that indefeasible or marketable (as  coverage is available) fee simple title to the Prospective Property is vested in such Additional  Borrower, (j) contain such endorsements Lender requires and are available under applicable title  insurance rules and such Additional Borrower shall satisfy all requirements therefor, (k) insure  any easements, leasehold estates or other matters appurtenant to or benefiting the Prospective  Property as part of the insured estate and not show the same as exceptions, (l) provide the  recording information for the UCC financing statement (if any) filed in the real estate records of  the county where the Prospective Property is located, (m) insure the zoning of (if permitted by  state regulations), and the right of access to, the Prospective Property to the extent authorized  under applicable title insurance rules and such Additional Borrower shall satisfy all requirements  therefor, and (n) contain provisions acceptable to Lender regarding Advances of Loan funds after  the Loan closing (including any Advances for which no title update may be required).   The Borrowers and Additional Borrowers shall be solely responsible for satisfying the  requirements of the Title Company necessary to allow the Company to issue the Title Policy  required by this Agreement. The conditions to Lender's obligation to make the Loan will not be    EXHIBIT C                                                              6502991 v5 (78055.00001.000) 

 

satisfied if the Title Policy required hereunder is not, or cannot be, issued, whether caused by  such Additional Borrower's failure to satisfy the underwriter's requirements or otherwise.   EXHIBIT C                                                              6502991 v5 (78055.00001.000) 

 

                                 EXHIBIT D        FORM OF   REQUEST   FOR ADVANCE FOR OPERATIONAL PURPOSES   (LETTERHEAD OF HARTMAN PARTNERSHIP)                             Date: _____________, ____  East West Bank 9090 Katy Freeway, 3rd Fl. Houston, Texas 77024 Attention: Esau Liu        $20,000,000.00 loan (the "Loan") from East West Bank ("Lender") to Hartman Spectrum,              LLC ("Hartman Spectrum"), Hartman 11211, LLC ("Hartman 11211"), Hartman              vREIT XXI Operating Partnership L.P. ("Hartman Partnership"; and Hartman              Spectrum, Hartman 11211 and Hartman Partnership are collectively referred to              herein as "Borrowers" and each sometimes individually referred to as a              "Borrower"), which Loan is guaranteed by Hartman vREIT XXI ("Guarantor").  Ladies and Gentlemen:        In accordance with that certain Revolving Promissory Note dated as of December 27,  2018 (the "Note") and that certain Master Credit Facility Agreement dated of even dated  therewith executed by Borrowers and Guarantors (the "Loan Agreement"), this letter will serve  as the Operational Draw Request of Borrowers requesting the sum of $_____________ under the  Note.  All capitalized terms used herein, and not otherwise defined herein, have the same  meaning as in the Loan Agreement.        The requested draw amount (the "Requested Draw Amount") is $__________.        Each of the Loan Parties hereby acknowledges that it has no outstanding defenses,  claims, counterclaims or offsets against Lender under the Loan Documents.        Each of the Loan Parties represents and warrants to Lender as of the date hereof that:  (a)  each of the representations and warranties of any Loan Party contained in the Loan Documents  were true, correct and complete as of the date of the Note and as of the date of any previous    EXHIBIT D                                                    6502991 v5 (78055.00001.000) 

 

Advance and continue to be true and correct in all material respects as of the date hereof; (b) the  Requested Draw Amount, when added to the principal balance of the Note outstanding on the  date hereof does not exceed $20,000,000.00; (c) the funding of the Requested Draw Amount will  not cause the ICR for all of the Mortgaged Properties to exceed 1.50; (d) no Default or Breach  has occurred and is continuing under the Note, the Instrument or any other Loan Document; and  (e) each of the Loan Parties continues to be in compliance in all material respects with all of the  other terms, covenants and conditions contained in the Note, the Instrument and the other Loan  Documents.                                 Very truly yours,                                      BORROWERS:                                       HARTMAN VREIT XXI OPERATING                                      PARTNERSHIP L.P.,                                     a Texas limited partnership                                      By: Hartman vREIT XXI, Inc.,                                             a Maryland Corporation                                            its General Partner                                            By:                                           Name:                                           Title:                                       HARTMAN SPECTRUM, LLC,                                      a Texas limited liability company                                      By:   Hartman Income REIT Management, Inc.,                                           a Texas corporation,                                           its Manager                                            By:                                           Name:                                           Title:   EXHIBIT D                                                    6502991 v5 (78055.00001.000) 

 

                                    HARTMAN 11211, LLC,                                      a Texas limited liability company                                      By:   Hartman Income REIT Management, Inc.,                                           a Texas corporation,                                           its Manager                                            By:                                           Name:                                           Title:                                       ADDITIONAL BORROWER:                                      __________________________________                                     a _____________________________                                      By:                                     Print Name:_________________________                                            Title:_______________________________                                       GUARANTOR:                                       HARTMAN VREIT XXI, INC.,                                      a Maryland corporation                                      By:                                     Name:                                     Title:   EXHIBIT D                                                    6502991 v5 (78055.00001.000) 

 

                                 EXHIBIT E   FORM OF REQUEST FOR ADVANCE FOR ACQUISITION/REFINANCE PURPOSE   (LETTERHEAD OF HARTMAN PARTNERSHIP)  Date:  ____________________________  East West Bank 9090 Katy Freeway, 3rd Floor Houston, Texas 77024 ("Lender")  Re:   Request for Advance to pay for the acquisition or re-finance of a Prospective Property in  accordance with that certain Master Credit Facility Agreement (the "Loan Agreement") dated as  of December 27, 2018, by and among by East West Bank ("Lender"), Hartman vREIT XXI  Operating Partnership L.P., a Texas limited partnership ("Hartman Partnership"), Hartman  Spectrum, LLC, a Texas limited liability company ("Hartman Spectrum"), Hartman 11211, LLC,  Texas limited liability company ("Hartman 11211"; and Hartman Spectrum , Hartman 11211 and  Hartman Partnership are collectively referred to herein as "Borrowers" and each sometimes  individually referred to as a "Borrower"), and Hartman vREIT XXI, a Maryland corporation  ("Guarantor"; and Borrowers and Guarantor are collectively referred to herein as the "Loan  Parties", and each sometimes individually referred to as a "Loan Party"). Capitalized terms not  otherwise defined herein shall have the meanings given them in the Loan Agreement.  Ladies and Gentlemen:  The Loan Parties and ________________________________, a _________________________  ("Additional Borrower")  request an Advance under the Loan Agreement to pay costs incurred in  connection with the acquisition or re-finance of a Prospective Property, in the amount of  $__________________.    The documents, materials and other information required under Exhibit A of the Loan  Agreement are submitted with this letter and, among other things, identifies the Prospective  Property and provides information about Additional Borrower. If there is any additional  information that Lender requires please contact the undersigned.  The status of available funds under the Loan Agreement is as follows:        Total Committed Sum of Loan               $20,000,000.00   EXHIBIT E                                1                   6502991 v5 (78055.00001.000) 

 

      less Advances to date   -                 ($                    )        Remaining unadvanced Loan proceeds        $        Amount of this certification and Advance  $  The Loan Parties and Additional Borrower represent as follows:               (a)   The amount requested above does not exceed the lesser of (i) fifty   percent (50%) of the Prospective Property Purchase Price as shown on the Prospective   Property Purchase Contract submitted by the undersigned with this Request for Advance, (ii)   or fifty percent (50%) of the fair market appraised value of the Prospective Property as shown   in the MAI appraisal submitted by the undersigned with this Request for Advance or (iii) the   Remaining Committed Sum.               (b)   The Prospective Property does not have an ICR of more than 1.50 for   the twelve (12) months immediately preceding the date of this Request for Advance.               (c)   No previous Advance has been made under the Loan Agreement to pay   any of the costs for which the Loan Parties and Additional Borrower Requests this Advance.               (d)   The representations in the Loan Agreement, Deeds of Trust and other   Loan Documents are true and correct as of the date this Advance Request is submitted to   Lender.               (e)   No Default has occurred under the Loan Agreement, the Note, any Deed   of Trust or any other Loan Document that has not been waived in writing by Lender or cured to   the satisfaction of Lender.  The undersigned represents that he/she is a duly elected officer of the undersigned and is  authorized to make this Request for Advance.  Very truly yours,                                      HARTMAN VREIT XXI OPERATING                                      PARTNERSHIP L.P.,                                     a Texas limited partnership                                      By: Hartman vREIT XXI, Inc.,                                             a Maryland Corporation                                            its General Partner   EXHIBIT E                                2                   6502991 v5 (78055.00001.000) 

 

                                       By: ________________________________                                           Print Name:______________________                                           Title:___________________________                                      HARTMAN SPECTRUM, LLC,                                      a Texas limited liability company                                      By:   Hartman Income REIT Management, Inc.,                                           a Texas corporation,                                           its Manager                                            By:                                           Print Name:______________________                                           Title:___________________________                                       HARTMAN 11211, LLC,                                      a Texas limited liability company                                      By:   Hartman Income REIT Management, Inc.,                                           a Texas corporation,                                           its Manager                                            By:                                           Print Name:______________________                                           Title:___________________________                                       HARTMAN vREIT XXI,                                     a Maryland corporation                                      By:                                     Print Name:______________________                                     Title: _________________________                                       [ADDITIONAL BORROWER,                                      a ________________]   EXHIBIT E                                3                   6502991 v5 (78055.00001.000) 

 

                                    By:                                     Print Name:______________________                                         Title:___________________________   EXHIBIT E                                4                   6502991 v5 (78055.00001.000) 

 

                                  EXHIBIT F                     JOINDER TO REVOLVING PROMISSORY NOTE                     AND MASTER CREDIT FACILITYAGREEMENT         This JOINDER TO  REVOLVING    PROMISSORY    NOTE  AND  MASTER   CREDIT FACILITY AGREEMENT (this "Agreement"), dated as of _________ __, 20__, is executed by  East West Bank, a California state-chartered bank having an address at 9090 Katy Freeway, 3rd Floor, Houston, Texas 77024 ("Lender"), and Hartman vREIT XXI Operating Partnership L.P., a  Texas limited partnership, having an address at 2909 Hillcroft, Suite 420, Houston, Texas 77057  ("Hartman Partnership"), Hartman Spectrum, LLC, a Texas limited liability company, having an  address at 2909 Hillcroft, Suite 420, Houston, Texas 77057 ("Hartman Spectrum"), Hartman  11211, LLC, Texas limited liability company, having an address at 2909 Hillcroft, Suite 420,  Houston, Texas 77057 ("Hartman 11211"; and Hartman Spectrum, Hartman 11211 and Hartman  Partnership are collectively referred to herein as "Original Borrowers" and each sometimes  individually referred to as a "Original Borrower"), Hartman vREIT XXI, a Maryland  corporation, having an address at 2909 Hillcroft, Suite 420, Houston, Texas 77057 ("Guarantor";  and Borrowers and Guarantor are collectively referred to herein as the "Loan Parties", and each  sometimes   individually referred    to    as    a     "Loan    Party"),   and  _________________________________, a _________________________________, having an  address at _______________________ ("Additional Borrower").                                   RECITALS:     A. The Loan Parties and Lender, on December 27, 2018, entered into that certain Master        Credit Facility Agreement (the "Loan Agreement") governing the advance of that certain        $20,000,000 loan (the "Loan") evidenced by that certain Revolving Promissory Note (the        "Note") dated of even date therewith and executed by the Original Borrowers, and        secured by, among other things, those two certain Deeds of Trust, Assignment of Rents        and Security Agreements, both dated of even date herewith, one granted by Hartman        Spectrum for the benefit of Lender (the "Spectrum DOT") and the other granted by        Hartman 11211 for the benefit of Lender (the "11211 DOT"; and the Spectrum DOT and        the 11211 DOT are hereinafter collectively referred to as the "Initial Deeds of Trust" and        each sometimes individually referred to as an "Initial Deed of Trust"), and the payment        and performance of which Loan is guaranteed by Guarantor pursuant to that certain        Guaranty executed by Guarantor, dated of even date therewith in favor of Lender.        Capitalized terms not otherwise defined herein are being used herein as defined in the        Loan Agreement.     B. Additional Borrower is this day executing and delivering to Lender together with this        Agreement:   EXHIBIT F                                                    6785977 v5 (78055.00038.000) 

 

            (i)   A Deed  of Trust, Assignment of Rents and Security Agreement (the                    "Additional Deed of Trust") in favor of Lender encumbering real property                    located at _____________________, Texas (the "Additional Property");              (ii)  An environmental indemnity agreement in favor of Lender covering the                    Additional Property (the "Additional EIA");              (iii) Uniform Commercial Code UCC-1 state and county financing statements                    covering personal property on the Additional Property (the "Additional                    UCC-1s"); and              (iv)  Additional agreements, resolutions and certificates in favor or Lender (the                   "Additional Agreements"; and this Agreement, the Additional Deed of                    Trust, the Additional EIA, the Additional UCC and the Additional                    Agreements are hereafter collectively referred to herein as the "Additional                    Loan Documents").   In consideration of the premises and other good and valuable consideration, the receipt and  sufficiency of which are hereby acknowledged, the Loan Parties and Additional Borrower agree  as follows:     1. Additional Borrower hereby acknowledges, agrees and confirms that, by its execution of       this Agreement, Additional Borrower is now and will be deemed to be a Borrower under        the Note and Loan Agreement.  Additional Borrower hereby ratifies, as of the date        hereof, and agrees to be bound by, all of the terms, provisions and conditions applicable        to the Original Borrowers contained in the Note and Loan Agreement as if it had been an        original signatory to the Note and Loan Agreement, including, but not limited to,        providing all Financial Statements, reports and other information required of an Original        Borrower under the Note, Loan Agreement, the Additional Deed of Trust simultaneously        with this Agreement and other Loan Documents     2. Additional Borrower hereby assumes all the obligations of a Borrower under the terms of        the Note and Loan Agreement and agrees that Additional Borrower is a Borrower and        bound as a Borrower under the terms of the Note and Loan Agreement, as if it had been        an original signatory to Note and Loan Agreement.      3. Additional Borrower hereby acknowledges and agrees that the Additional Loan        Documents are now part of and included within the Loan Documents.     4. The Loan Parties hereby acknowledge and agree that Additional Borrower is now a        Borrower under the Note and Loan Agreement and has assumed all obligations under the        Loan Documents.   EXHIBIT F                                                    6785977 v5 (78055.00038.000) 

 

   5. The Loan Parties hereby acknowledge and agree that the Additional Loan Documents are        now part of and included within the Loan Documents.     6. The Loan Parties confirm that, on the date hereof, all representations and warranties        contained in the Loan Documents, including, but not limited to, the Initial Deeds of Trust,        are true and correct in all material respects.     7. Additional Borrower's address for notices under the Loan Agreement is set forth above in        the introductory paragraph of this Agreement.     8. This Agreement shall be deemed to be part of, and a modification to, the Note, the Loan        Agreement and all other Loan Documents and shall be governed by all of the terms and        provisions of the Loan Agreement, as applicable, with respect to the modifications        intended to be made to each such agreement, which terms are incorporated herein by        reference, are ratified and confirmed and shall continue in full force and effect as valid,        binding and enforcable agreements of Additional Borrower. Wherever in the Note, Loan        Agreement or any other Loan Document, the term "Borrower" or any similar description        is used such term shall henceforth include Additional Borrower.  Additional Borrower        hereby waives notice of the Lender's acceptance of this Agreement. Additional Borrower        will deliver an executed original of this Agreement to the Lender.     9. Guarantor, in its capacity as guarantor of the Loan pursuant to the Guaranty, hereby joins        in the execution of this Agreement to confirm and ratify the Guaranty and all of        Guarantor's obligations thereunder notwithstanding the joinder of Additional Borrower as        a borrower under the Note, the Loan Agreement and other the Loan Documents.        Guarantor consents to the joinder of Additional Borrower as contemplated under this        Agreement.        The parties hereto have caused this Agreement to be duly executed and delivered by their  duly authorized officers as of the date first set forth above.                                       ADDITIONAL BORROWER:                                      __________________________________                                     a _____________________________                                      By:                                     Print Name:_________________________                                     Title:_______________________________   EXHIBIT F                                                    6785977 v5 (78055.00038.000) 

 

ACKNOWLEDGED AND AGREED:                                      ORIGINAL BORROWERS:                                      HARTMAN VREIT XXI OPERATING                                      PARTNERSHIP L.P.,                                     a Texas limited partnership                                      By: Hartman vREIT XXI, Inc.,                                             a Maryland Corporation                                            its General Partner                                         By: ________________________________                                           Print Name:______________________                                           Title:___________________________                                      HARTMAN SPECTRUM, LLC,                                      a Texas limited liability company                                      By:   Hartman Income REIT Management, Inc.,                                           a Texas corporation,                                           its Manager                                            By:                                           Print Name:______________________                                           Title:___________________________                                       HARTMAN 11211, LLC,                                      a Texas limited liability company                                      By:   Hartman Income REIT Management, Inc.,                                           a Texas corporation,                                           its Manager                                            By:                                           Print Name:______________________                                           Title:___________________________   EXHIBIT F                                                    6785977 v5 (78055.00038.000) 

 

                                    NEW BORROWER:                                      [NAME]                                      By:                                     Print Name:______________________                                     Title:___________________________                                       GUARANTOR:                                      HARTMAN vREIT XXI,                                      a Maryland corporation                                      By:                                     Print Name:______________________                                     Title: _________________________   EXHIBIT F                                                    6785977 v5 (78055.00038.000) 

 

                                    LENDER:                                      EAST WEST BANK                                      By:                                     Name:                                     Title:   EXHIBIT F                                                   6502991 V5 (78055.00038.000))

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