BRIDGE LOAN AGREEMENT

 

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                                                                   Exhibit 10.67

 

                              BRIDGE LOAN AGREEMENT

 

                          Dated as of September 9, 2005

 

                                      among

 

                         RAMCO-GERSHENSON PROPERTIES, L.P.

 

                                  as Borrower,

 

                                       and

 

                       RAMCO-GERSHENSON PROPERTIES TRUST,

 

                                  as Guarantor

 

                                        and

 

                          KEYBANK NATIONAL ASSOCIATION,

 

                                   as a Bank,

 

                                       and

 

               THE OTHER BANKS WHICH ARE A PARTY TO THIS AGREEMENT

 

                                        and

 

           THE OTHER BANKS WHICH MAY BECOME PARTIES TO THIS AGREEMENT

 

                                       and

 

                          KEYBANK NATIONAL ASSOCIATION,

 

                                    as Agent

 

                                       and

 

                            KEYBANC CAPITAL MARKETS,

 

                        as Sole Lead Manager and Arranger

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                              BRIDGE LOAN AGREEMENT

 

     This BRIDGE LOAN AGREEMENT is made as of the 9th day of September, 2005, by

and among RAMCO-GERSHENSON PROPERTIES, L.P., a Delaware limited partnership (the

"Borrower"), RAMCO-GERSHENSON PROPERTIES TRUST, a Maryland real estate

investment trust ("Guarantor"), KEYBANK NATIONAL ASSOCIATION, the other lenders

that are a party to this Agreement, and the other lending institutions which may

become parties hereto pursuant to Section 18 (the "Banks"), and KEYBANK NATIONAL

ASSOCIATION, a national banking association, as Administrative Agent for the

Banks (the "Agent").

 

                                    RECITALS

 

     WHEREAS, Borrower has obtained a loan (the "Original Loan") as evidenced by

those certain agreements and instruments more particularly described in the

Assignment of Loan Documents (the "Original Loan Documents"); and

 

     WHEREAS, Borrower has requested that the Banks provide a bridge loan to

Borrower by acquiring the documents evidencing the Original Loan and by amending

and restating the Original Loan and certain of the Original Loan Documents in

their entirety; and

 

     WHEREAS, Agent and the Banks are willing to amend and restate the Original

Loan and certain of the Original Loan Documents in their entirety on the terms

and conditions set forth herein.

 

     NOW, THEREFORE, in consideration of the terms and conditions herein, and of

any loans, advances, or extensions of credit now or hereafter made to or for the

benefit of the Borrower by the Banks, the parties hereto hereby amend and

restate the loan agreements included in the Original Loan Documents and covenant

and agree as follows:

 

SECTION 1. DEFINITIONS AND RULES OF INTERPRETATION.

 

     SECTION 1.1 DEFINITIONS. The following terms shall have the meanings set

forth in this Section 1 or elsewhere in the provisions of this Agreement

referred to below:

 

     Affiliate. An Affiliate, as applied to any Person, shall mean any other

Person directly or indirectly controlling, controlled by, or under common

control with, that Person. For purposes of this definition, "control"

(including, with correlative meanings, the terms "controlling", "controlled by"

and "under common control with"), as applied to any Person, means (a) the

possession, directly or indirectly, of the power to vote ten percent (10%) or

more of the stock, shares, voting trust certificates, beneficial interests,

partnership interests, member interests or other interests having voting power

for the election of directors of such Person or otherwise to direct or cause the

direction of the management and policies of that Person, whether through the

ownership of voting securities or by contract or otherwise, or (b) the ownership

of (i) a general partnership interest, (ii) a managing member's interest in a

limited liability company or (iii) a limited partnership interest or preferred

stock (or other ownership interest) representing ten percent (10%) or more of

the outstanding limited or general partnership interests, preferred stock or

other ownership interests of such Person.

 

     Agent. KeyBank, acting as Administrative Agent for the Banks, its

successors and assigns.

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     Agent's Head Office. The Agent's head office located at 127 Public Square,

Cleveland, Ohio 44114-1306, or at such other location as the Agent may designate

from time to time by notice to the Borrower and the Banks.

 

     Agent's Special Counsel. McKenna Long & Aldridge LLP or such other counsel

as may be approved by the Agent.

 

     Agreement. This Bridge Loan Agreement, including the Schedules and Exhibits

hereto.

 

     Assignment of Leases and Rents. Each of the collateral assignments of

leases and rents from the Borrower to the Agent, as the same may be modified or

amended, pursuant to which there shall be assigned to the Agent for the benefit

of the Banks a security interest in the interest of the Borrower as lessor with

respect to all Leases of all or any part of a Collateral Property, each such

collateral assignment to be in form and substance satisfactory to the Agent.

 

     Assignment of Loan Documents. [THE TRANSFER AND ASSIGNMENT OF PROMISSORY

NOTE AND OTHER LOAN DOCUMENTS] from the holder or holders of the Original Loan

Documents to the Agent.

 

     Balance Sheet Date. June 30, 2005.

 

     Banks. KeyBank and any other Person who becomes an assignee of any rights

of a Bank pursuant to Section 18.

 

     Base Rate. The greater of (a) the variable per annum rate of interest

announced from time to time by Agent at Agent's Head Office as its "prime rate"

or (b) one-half of one percent (0.5%) above the Federal Funds Effective Rate

(rounded upwards, if necessary, to the next one-eighth of one percent). The Base

Rate is a reference rate and does not necessarily represent the lowest or best

rate being charged to any customer. Any change in the rate of interest payable

hereunder resulting from a change in the Base Rate shall become effective as of

the opening of business on the day on which such change in the Base Rate becomes

effective, without notice or demand of any kind.

 

     Base Rate Loans. Those Loans bearing interest calculated by reference to

the Base Rate.

 

     Borrower. As defined in the preamble hereto.

 

     Building. With respect to each Collateral Property, all of the buildings,

structures and improvements now or hereafter located thereon.

 

     Building Service Equipment. All apparatus, fixtures and articles of

personal property owned by the Borrower now or hereafter attached to or used or

procured for use in connection with the operation or maintenance of any

building, structure or other improvement located on or included in the

Collateral Properties, including, but without limiting the generality of the

foregoing, all engines, furnaces, boilers, stokers, pumps, heaters, tanks,

dynamos, motors, generators, switchboards, electrical equipment, heating,

plumbing, lifting and ventilating apparatus, air-cooling and air-conditioning

apparatus, gas and electric fixtures, elevators, escalators, fittings, and

machinery and all other equipment of every kind and description, used or

procured for use in the operation of a Building and located on the Collateral

Properties (except apparatus, fixtures or articles of personal property

belonging to lessees or other occupants of such building or to persons other

than the Borrower unless the same be abandoned by any such lessee or other

occupant or person and shall become the Borrower's property by reason of such

abandonment), together with any and all replacements thereof and additions

thereto.

 

 

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     Business Day. Any day on which banking institutions located in Cleveland,

Ohio are open for the transaction of banking business and, in the case of LIBOR

Rate Loans, which also is a LIBOR Business Day.

 

     Capital Expenditure Reserve Amount. With respect to the Collateral

Properties, a reserve for replacements and capital expenditures equal to $.10

per square foot of building space located on such Collateral Properties.

 

     Capitalized Lease. A lease under which a Person is the lessee or obligor,

the discounted future rental payment obligations under which are required to be

capitalized on the balance sheet of the lessee or obligor in accordance with

generally accepted accounting principles.

 

     CERCLA. See Section 6.18.

 

     Change of Control. The occurrence of any one of the following events:

 

          (a) during any twelve month period on or after the date hereof,

individuals who at the beginning of such period constituted the Board of

Directors of Guarantor (together with any new directors whose election by the

Board of Directors or whose nomination for election by the shareholders of

Guarantor was approved by a vote of at least a majority of the members of the

Board of Directors then in office who either were members of the Board of

Directors at the beginning of such period or whose election or nomination for

election was previously so approved) cease for any reason to constitute a

majority of the members of the Board of Directors then in office; or

 

          (b) there occurs a change of control of Guarantor of a nature that

would be required to be reported in response to Item 1a of Form 8-K filed

pursuant to Section 13 or 15 under the Securities Exchange Act of 1934, or in

any other filing by Guarantor with the Securities and Exchange Commission; or

 

          (c) the Borrower or Guarantor consolidates with, is acquired by, or

merges into or with any Person (other than a merger permitted by Section 8.4).

 

     Closing Date. The first date on which all of the conditions set forth in

Section 10 and Section 11 have been satisfied.

 

     Code. The Internal Revenue Code of 1986, as amended.

 

     Collateral. All of the property, rights and interests of Borrower which are

or are intended to be subject to the security interests and liens created by the

Security Documents, including, without limitation, the Guaranty.

 

      Collateral Operating Cash Flow. With respect to the Collateral Properties

as of any date of determination, an amount equal to the sum of (a) the Net

Income of Borrower attributable to the Collateral Properties for the preceding

four (4) fiscal quarters plus (b) depreciation and amortization, interest

expense, and any extraordinary or nonrecurring losses deducted in calculating

such Net Income, minus (c) any extraordinary or nonrecurring gains included in

calculating such Net Income, minus (d) the Capital Expenditure Reserve Amount,

all as determined in accordance with generally accepted accounting principles.

 

     Collateral Property or Collateral Properties. The Real Estate owned by the

Borrower which is encumbered by the Security Deeds.

 

 

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     Collateral Value. As of any date of determination for any Collateral

Property, an amount equal to the Collateral Operating Cash Flow from such

Collateral Property divided by 0.085.

 

     Commitment. With respect to each Bank, the amount set forth on Schedule 1

hereto as the amount of such Bank's Commitment to make or maintain Loans to the

Borrower for the account of the Borrower, as the same may be changed from time

to time in accordance with the terms of this Agreement.

 

     Commitment Percentage. With respect to each Bank, the percentage set forth

on Schedule 1 hereto as such Bank's percentage of the aggregate Commitments of

all of the Banks, as the same may be changed from time to time in accordance

with the terms of this Agreement.

 

     Compliance Certificate. See Section 7.4(e).

 

     Consolidated or combined. With reference to any term defined herein, that

term as applied to the accounts of a Person and its Subsidiaries, consolidated

or combined in accordance with generally accepted accounting principles.

 

     Conversion Request. A notice given by the Borrower to the Agent of its

election to convert or continue a Loan in accordance with Section 4.1.

 

     Debt Offering. The issuance and sale by the Borrower or Guarantor of any

debt securities of the Borrower or Guarantor.

 

     Default. See Section 12.1. In addition, any "Default" (as defined in the

Secured Revolving Credit Agreement) shall also be a Default hereunder.

 

     Defaulting Bank. Any Bank which fails or refuses to perform its obligations

under this Agreement within the time period specified for performance of such

obligation or, if no time frame is specified, if such failure or refusal

continues for a period of five (5) Business Days after notice from the Agent.

 

     Distribution. With respect to any Person, the declaration or payment of any

cash, cash flow, dividend or distribution on or in respect of any shares of any

class of capital stock or other beneficial interest of such Person other than

dividends or distributions payable solely in equity securities of such Person;

the purchase, redemption, exchange or other retirement of any shares of any

class of capital stock or other beneficial interest of such Person, directly or

indirectly through a Subsidiary of such Person or otherwise; the return of

capital by such Person to its shareholders, partners or other owners as such; or

any other distribution on or in respect of any shares of any class of capital

stock or other beneficial interest of such Person.

 

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

 

     Domestic Lending Office. Initially, the office of each Bank designated as

such in Schedule 1 hereto; thereafter, such other office of such Bank, if any,

located within the United States that will be making or maintaining Base Rate

Loans.

 

     Drawdown Date. The date on which any Loan is made or is to be made, and the

date on which any Loan which is made prior to the Maturity Date is converted or

combined in accordance with Section 4.1.

 

     Eligible Real Estate Qualification Documents. With respect to any

Collateral Property, each of the following:

 

 

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     (a) Security Documents. Such Security Documents as Agent shall require

relating to such Real Estate, in form and substance satisfactory to the Agent

and duly executed and delivered by the respective parties thereto.

 

     (b) Enforceability Opinion. The favorable legal opinion of counsel to the

Borrower and the Guarantor reasonably acceptable to the Agent qualified to

practice in the State of Michigan addressed to the Banks and the Agent and in

form and substance satisfactory to the Agent as to the enforceability of such

Security Documents and such other matters as the Agent shall reasonably request.

 

     (c) Perfection of Liens. Evidence reasonably satisfactory to the Agent that

the Security Documents are effective to create in favor of the Agent a legal,

valid and enforceable first (except for Permitted Liens approved by the Agent

entitled to priority under applicable law) lien and security interest in such

Real Estate, and that all filings, recordings, deliveries of instruments and

other actions necessary or desirable to protect and preserve such lien or

security interest have been duly effected.

 

     (d) Taxes. Evidence of payment of all real estate taxes, assessments and

municipal charges on such Real Estate which on the date of determination are

required to have been paid under Section 7.8.

 

     (e) Title Insurance; Title Exception Documents. The Title Policy covering

such Real Estate, including all endorsements thereto (including an endorsement

reflecting the assignment of the Original Loan Documents to Agent, and the

amendment thereof pursuant to this Agreement), and together with proof of

payment of all fees and premiums for such policy, and true and accurate copies

of all documents listed as exceptions under such policy or any supplements

thereto accepted by Agent.

 

     (f) UCC Certification. A certification from the Title Insurance Company or

other Person satisfactory to the Agent that a search of the public records

designated by the Agent disclosed no conditional sales contracts, security

agreements, chattel mortgages, leases of personalty, financing statements or

title retention agreements which affect any property, rights or interests of the

Borrower that are or are intended to be subject to the security interest,

assignments, and mortgage liens created by the Security Documents relating to

such Real Estate except to the extent that the same are discharged and removed

prior to or simultaneously with the inclusion of the Real Estate in the

Collateral.

 

     (g) Certificates of Insurance. Each of (i) a current certificate of

insurance as to the insurance maintained by the Borrower on such Real Estate

(including flood insurance if necessary) or blanket coverage which includes such

Real Estate in accordance with the terms of the Loan Documents from the insurer

or an independent insurance broker dated as of the date of determination,

identifying insurers, types of insurance, insurance limits, and policy terms;

(ii) certified copies of all policies evidencing such insurance (or certificates

therefor signed by the insurer or an agent authorized to bind the insurer); and

(iii) such further information and certificates from the Borrower, its insurers

and insurance brokers as the Agent may reasonably request, all of which shall be

in compliance with the requirements of the Loan Documents.

 

     (h) Additional Documents. Such other documents, certificates, reports or

assurances as the Agent may reasonably require in its discretion.

 

 

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     Employee Benefit Plan. Any employee benefit plan within the meaning of

Section 3(3) of ERISA maintained or contributed to by the Borrower, the

Guarantor or any ERISA Affiliate, other than a Multiemployer Plan.

 

     Environmental Engineer. Environmental Services, Inc., or another firm of

independent professional engineers or other scientists generally recognized as

expert in the detection, analysis and remediation of Hazardous Substances and

related environmental matters and which has been previously approved by the

Agent, or if not previously approved by the Agent, with respect to which the

Borrower has provided to the Agent a copy of such firm's errors and omissions

insurance policy and a reliance letter both in form and substance acceptable to

the Agent.

 

     Environmental Laws. See Section 6.18(a).

 

     Equity Offering. The issuance and sale by the Borrower or Guarantor of any

equity securities of the Borrower or Guarantor.

 

     ERISA. The Employee Retirement Income Security Act of 1974, as amended and

in effect from time to time.

 

     ERISA Affiliate. Any Person which is treated as a single employer with the

Borrower or Guarantor under Section 414 of the Code.

 

     ERISA Reportable Event. A reportable event with respect to a Guaranteed

Pension Plan within the meaning of Section 4043 of ERISA and the regulations

promulgated thereunder as to which the requirement of notice has not been

waived.

 

     Event of Default. See Section 12.1.

 

     Federal Funds Effective Rate. For any day, the rate per annum (rounded to

the nearest one hundredth of one percent (1/100 of 1%)) announced by the Federal

Reserve Bank of Cleveland on such day as being the weighted average of the rates

on overnight federal funds transactions arranged by federal funds brokers on the

previous trading day, as computed and announced by such Federal Reserve Bank in

substantially the same manner as such Federal Reserve Bank computes and

announces the weighted average it refers to as the "Federal Funds Effective

Rate", or, if such rate is not so published for any day that is a Business Day,

the average of the quotations for such day on such transactions received by the

Agent from three (3) Federal funds brokers of recognized standing selected by

the Agent.

 

     Generally accepted accounting principles. Principles that are (a)

consistent with the principles promulgated or adopted by the Financial

Accounting Standards Board and its predecessors, as in effect from time to time

and (b) consistently applied with past financial statements of the Person

adopting the same principles; provided that a certified public accountant would,

insofar as the use of such accounting principles is pertinent, be in a position

to deliver an unqualified opinion (other than a qualification regarding changes

in generally accepted accounting principles) as to financial statements in which

such principles have been properly applied. Notwithstanding the foregoing, for

the purposes of the financial calculations hereunder, any amount otherwise

included therein from a mark-up or mark-down of a derivative product of a Person

shall be excluded.

 

     Guaranteed Pension Plan. Any employee pension benefit plan within the

meaning of Section 3(2) of ERISA maintained or contributed to by the Borrower,

Guarantor or any ERISA Affiliate the benefits of which are guaranteed on

termination in full or in part by the PBGC pursuant to Title IV of ERISA, other

than a Multiemployer Plan.

 

 

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     Guarantor. As defined in the preamble hereto.

 

     Guaranty. The Unconditional Guaranty of Payment and Performance dated of

even date herewith made by the Guarantor in favor of the Agent and the Banks, as

the same may be modified or amended, such Guaranty to be in form and substance

satisfactory to the Agent.

 

     Hazardous Substances. See Section 6.18(b).

 

     HLT Notice Date. See Section 4.13.

 

     Indebtedness. All obligations, contingent and otherwise, that in accordance

with generally accepted accounting principles should be classified upon the

obligor's balance sheet as liabilities, or to which reference should be made by

footnotes thereto, but without any double counting, including in any event and

whether or not so classified: (a) all debt and similar monetary obligations,

whether direct or indirect (including, without limitation, any obligations

evidenced by bonds, debentures, notes or similar debt instruments); (b) all

liabilities secured by any mortgage, pledge, security interest, lien, charge or

other encumbrance existing on property owned or acquired subject thereto,

whether or not the liability secured thereby shall have been assumed; (c) all

guarantees, endorsements and other contingent obligations whether direct or

indirect in respect of indebtedness of others, including any obligation to

supply funds to or in any manner to invest directly or indirectly in a Person,

to purchase indebtedness, or to assure the owner of indebtedness against loss

through an agreement to purchase goods, supplies or services for the purpose of

enabling the debtor to make payment of the indebtedness held by such owner or

otherwise; (d) any obligation as a lessee or obligor under a Capitalized Lease;

(e) all subordinated debt; and (f) all obligations, contingent or deferred or

otherwise, of any Person, including, without limitation, any such obligations as

an account party under acceptance, letter of credit or similar facilities

including, without limitation, obligations to reimburse the issuer in respect of

a letter of credit except for contingent obligations (but excluding any

guarantees or similar obligations) that are not material and are incurred in the

ordinary course of business in connection with the acquisition or obtaining

commitments for financing of Real Estate.

 

     Indemnity Agreement. The Indemnity Agreement Regarding Hazardous Materials

made by the Borrower and the Guarantor in favor of the Agent and the Banks, as

the same may be modified or amended, pursuant to which the Borrower and the

Guarantor agree to indemnify the Agent and the Banks with respect to Hazardous

Substances and Environmental Laws, such Indemnity Agreement to be in form and

substance satisfactory to the Majority Banks.

 

     Interest Payment Date. As to each Base Rate Loan, the first day of each

calendar month during the term of such Base Rate Loan, and as to each LIBOR Rate

Loan, the first day of each calendar month during the term of such LIBOR Rate

Loan and the last day of the Interest Period relating thereto.

 

     Interest Period. With respect to each LIBOR Rate Loan (a) initially, the

period commencing on the Drawdown Date of such Loan and ending one, two or three

months (or, with the consent of the Banks, a period of less than one (1) month)

thereafter and (b) thereafter, each period commencing on the day following the

last day of the next preceding Interest Period applicable to such Loan and

ending on the last day of one of the periods set forth above, as selected by the

Borrower in a Conversion Request; provided that all of the foregoing provisions

relating to Interest Periods are subject to the following:

 

     (i) if any Interest Period with respect to a LIBOR Rate Loan would

otherwise end on a day that is not a LIBOR Business Day, that Interest Period

shall end and the next Interest Period shall commence on the next preceding or

succeeding LIBOR Business Day as determined conclusively by the Agent in

accordance with the then current bank practice in the London Interbank Market;

 

 

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     (ii) if the Borrower shall fail to give notice as provided in Section 4.1,

the Borrower shall be deemed to have requested a conversion of the affected

LIBOR Rate Loan to a Base Rate Loan on the last day of the then current Interest

Period with respect thereto; and

 

     (iii) no Interest Period relating to any LIBOR Rate Loan shall extend

beyond the Maturity Date.

 

     Interest Rate Contracts. Interest rate swap, collar, cap or similar

agreements providing interest rate protection.

 

     Investments. With respect to any Person, all shares of capital stock,

evidences of Indebtedness and other securities issued by any other Person, all

loans, advances, or extensions of credit to, or contributions to the capital of,

any other Person, all purchases of the securities or business or integral part

of the business of any other Person and commitments and options to make such

purchases, all interests in real property, and all other investments; provided,

however, that the term "Investment" shall not include (i) equipment, inventory

and other tangible personal property acquired in the ordinary course of

business, or (ii) current trade and customer accounts receivable for services

rendered in the ordinary course of business and payable in accordance with

customary trade terms. In determining the aggregate amount of Investments

outstanding at any particular time: (a) the amount of any Investment represented

as a guaranty shall be taken at not less than the principal amount of the

obligations guaranteed and still outstanding; (b) there shall be included as an

Investment all interest accrued with respect to Indebtedness constituting an

Investment unless and until such interest is paid; (c) there shall be deducted

in respect of each such Investment any amount received as a return of capital

(but only by repurchase, redemption, retirement, repayment, liquidating dividend

or liquidating distribution); (d) there shall not be deducted in respect of any

Investment any amounts received as earnings on such Investment, whether as

dividends, interest or otherwise, except that accrued interest included as

provided in the foregoing clause (b) may be deducted when paid; and (e) there

shall not be deducted from the aggregate amount of Investments any decrease in

the value thereof.

 

     KeyBank. KeyBank National Association, a national banking association, and

its successors by merger.

 

     Lead Arranger. KeyBanc Capital Markets.

 

     Leases. Leases, licenses and agreements whether written or oral, relating

to the use or occupation of space in or on the Building or on the Real Estate by

persons other than any Affiliate of Borrower.

 

     LIBOR Business Day. Any day on which commercial banks are open for

international business (including dealings in Dollar deposits) in London.

 

     LIBOR Lending Office. Initially, the office of each Bank designated as such

in Schedule 1 hereto; thereafter, such other office of such Bank, if any, that

shall be making or maintaining LIBOR Rate Loans.

 

     LIBOR Rate. For any LIBOR Rate Loan for any Interest Period, the average

rate (rounded to the nearest 1/100th) as shown in Dow Jones Markets (formerly

Telerate) (Page 3750) at which deposits in U.S. dollars are offered by first

class banks in the London Interbank Market at approximately 11:00 a.m. (London

time) on the day that is two (2) LIBOR Business Days prior to the first day of

such Interest Period with a maturity approximately equal to such Interest Period

and in an amount approximately equal to the amount to which such Interest Period

relates, adjusted for reserves and taxes if required by future regulations. If

Dow Jones Markets no longer reports such rate or Agent determines in good faith

that the

 

 

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rate so reported no longer accurately reflects the rate available to Agent in

the London Interbank Market, Agent may select a replacement index. For any

period during which a Reserve Percentage shall apply, the LIBOR Rate with

respect to LIBOR Rate Loans shall be equal to the amount determined above

divided by an amount equal to 1 minus the Reserve Percentage.

 

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

Rate.

 

     Loan Documents. This Agreement, the Notes, the Security Documents and all

other documents, instruments or agreements now or hereafter executed or

delivered by or on behalf of the Borrower or the Guarantor in connection with

the Loans.

 

     Loan Request. See Section 2.5.

 

     Loans. See Section 2.1.

 

     Majority Banks. As of any date, any Bank or collection of Banks whose

aggregate Commitment Percentage is more than fifty percent (50%); provided,

that, in determining said percentage at any given time, all then existing

Defaulting Banks will be disregarded and excluded and the Commitment Percentages

of the Banks shall be redetermined for voting purposes only, to exclude the

Commitment Percentages of such Defaulting Banks.

 

     Management Agreements. Any agreements, whether written or oral, providing

for the management of the Collateral Properties or any of them, as the same may

be modified or amended from time to time.

 

     Management Company Agreement and Consent. An agreement, in form and

substance satisfactory to Agent, whereby the applicable management company, if

any, agrees that (a) upon foreclosure of any of the Collateral or transfer in

lieu thereof, the Management Agreements will terminate as to such Collateral

Property, and (b) upon foreclosure of any of the Collateral or transfer in lieu

thereof, Agent shall have no obligations or liabilities under any Management

Agreement.

 

     Maturity Date. December 29, 2005, or such earlier date on which the Loans

shall become due and payable pursuant to the terms hereof.

 

     Multiemployer Plan. Any multiemployer plan within the meaning of Section

3(37) of ERISA maintained or contributed to by the Borrower, Guarantor or any

ERISA Affiliate.

 

     Net Income (or Deficit). With respect to any Collateral Property for any

fiscal period, the net income (or deficit) of Borrower attributable to such

Collateral Property, after deduction of all expenses, taxes and other proper

charges, determined in accordance with generally accepted accounting principles.

 

      Net Proceeds. With respect to the refinance of the Collateral Properties

commonly known as Jackson West, New Towne Plaza and West Oaks, in accordance

with the provisions of Section 5.2, all gross proceeds of such refinance plus

all other consideration received in conjunction with such refinance less all

reasonable, ordinary and customary costs, expenses and commissions incurred as a

direct result of such refinance and paid to any Person that is unrelated to the

Borrower, Guarantor or any of their respective partners, members, managers,

officers or directors or any Person affiliated with the Borrower, Guarantor or

any their respective partners, members, managers, officers or directors.

 

     Non-recourse Indebtedness. Indebtedness of a Person which is secured solely

by one or more parcels of Real Estate and related personal property and is not a

general obligation of such Person, the

 

 

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holder of such Indebtedness having recourse solely to the parcels of Real Estate

securing such Indebtedness, the Building and Leases thereon and the rents and

profits thereof.

 

     Non-Consenting Bank. See Section 18.9.

 

     Notes. See Section 2.3.

 

     Notice. See Section 19.

 

     Obligations. All indebtedness, obligations and liabilities of the Borrower

and the Guarantor to any of the Banks and the Agent, individually or

collectively, under this Agreement or any of the other Loan Documents or in

respect of any of the Loans or the Notes, or other instruments at any time

evidencing any of the foregoing, whether existing on the date of this Agreement

or arising or incurred hereafter, direct or indirect, joint or several, absolute

or contingent, matured or unmatured, liquidated or unliquidated, secured or

unsecured, arising by contract, operation of law or otherwise.

 

     OFAC. Office of Foreign Asset Control of the Department of the Treasury of

the United States of America.

 

     Original Loan. As defined in the preamble.

 

     Original Loan Documents. As defined in the preamble.

 

     Original Notes. The promissory notes relating to the Original Loan

described in Exhibit D attached hereto and made a part hereof.

 

     Outstanding. With respect to the Loans, the aggregate unpaid principal

thereof as of any date of determination.

 

     Patriot Act. The Uniting and Strengthening America by Providing Appropriate

Tools Required to Intercept and Obstruct Terrorism Act of 2001, as the same may

be amended from time to time, and corresponding provisions of future laws.

 

     PBGC. The Pension Benefit Guaranty Corporation created by Section 4002 of

ERISA and any successor entity or entities having similar responsibilities.

 

     Permitted Liens. Permitted Liens mean

 

     (i) liens in favor of the Borrower or the Guarantor on all or part of the

assets of Subsidiaries of such Person (other than Collateral) securing

Indebtedness owing by Subsidiaries of such Person to such Person;

 

     (ii) liens on properties to secure taxes, assessments and other

governmental charges or claims for labor, material or supplies in respect of

obligations not overdue;

 

     (iii) deposits or pledges made in connection with, or to secure payment of,

workers' compensation, unemployment insurance, old age pensions or other social

security obligations;

 

     (iv) liens on properties other than the Collateral Property or any interest

therein (including the rents, issues and profits therefrom) in respect of

judgments, awards or indebtedness, the Indebtedness with respect to which is

permitted by Section 8.1(d) or Section 8.1(f) of the Secured Revolving Credit

Agreement;

 

 

                                       10

<PAGE>

     (v) encumbrances on properties other than the Collateral Property

consisting of easements, rights of way, zoning restrictions, restrictions on the

use of real property and defects and irregularities in the title thereto,

landlord's or lessor's liens under leases to which the Borrower, the Guarantor

or a Subsidiary of such Person is a party, and other minor liens or encumbrances

none of which interferes materially with the use of the property affected in the

ordinary conduct of the business of the Borrower, the Guarantor or their

Subsidiaries, which encumbrances, liens or defects do not individually or in the

aggregate have a materially adverse effect on the business of the Borrower or

the Guarantor individually or of such Person and its Subsidiaries on a

Consolidated basis;

 

     (vi) liens on the specific personal property (other than Collateral)

acquired by Indebtedness permitted under Section 8.1(i) of the Secured Revolving

Credit Agreement;

 

     (vii) liens in favor of the Agent and the Banks granted pursuant to the

Senior Revolving Credit Agreement;

 

     (viii) liens and encumbrances on a Collateral Property expressly permitted

under the terms of the Security Deed relating thereto; and

 

     (ix) liens and encumbrances on Real Estate (other than a Collateral

Property) that is the subject of a construction loan permitted under the terms

of Section 8.1(j) of the Secured Revolving Credit Agreement.

 

     Person. Any individual, corporation, partnership, limited liability

company, trust, unincorporated association, business, or other legal entity, and

any government or any governmental agency or political subdivision thereof.

 

     Pro Forma Debt Service. At any time determined by the Agent, an amount

equal to the annual principal and interest payable on a loan in a principal

amount equal to the outstanding principal balance of the Loan (after giving

effect to any requested advance of the Loan) bearing interest at a rate per

annum equal to the greater of (i) the then-current annual yield on seven (7)

year obligations issued by the United States Treasury most recently prior to the

date of determination plus 1.75% payable based on a 25 year mortgage style

amortization schedule (expressed as a mortgage constant percentage) and (ii)

eight percent (8.0%). The determination of the Pro Forma Debt Service and the

components thereof by the Agent shall, so long as the same shall be determined

in good faith, be conclusive and binding absent manifest error.

 

     Real Estate. All real property at any time owned or leased (as lessee or

sublessee) by the Guarantor, Borrower or any of their respective Subsidiaries.

 

     Record. The grid attached to any Note, or the continuation of such grid, or

any other similar record, including computer records, maintained by Agent with

respect to any Loan referred to in such Note.

 

     Register. See Section 18.2.

 

     REIT Status. With respect to Guarantor, its status as a real estate

investment trust as defined in Section 856(a) of the Code.

 

     Release. See Section 6.18(c)(iii).

 

     Rent Roll. A report prepared by the Borrower in the form customarily used

by the Borrower and approved by the Agent, such approval not to be unreasonably

withheld.

 

 

                                       11

<PAGE>

     Reserve Percentage. For any day with respect to a LIBOR Rate Loan, the

maximum rate (expressed as a decimal) at which any lender subject thereto would

be required to maintain reserves (including, without limitation, all base,

supplemental, marginal and other reserves) under Regulation D of the Board of

Governors of the Federal Reserve System (or any successor or similar regulations

relating to such reserve requirements) against "Eurocurrency Liabilities" (as

that term is used in Regulation D or any successor or similar regulation), if

such liabilities were outstanding. The Reserve Percentage shall be adjusted

automatically on and as of the effective date of any change in the Reserve

Percentage.

 

     SEC. The federal Securities and Exchange Commission.

 

     Secured Revolving Credit Agreement. The Fourth Amended and Restated Master

Revolving Credit Agreement dated as of December 30, 2002, among Borrower,

Guarantor, Fleet National Bank, individually and as agent, and the other banks

that from time to time thereto, and the other parties thereto, as such agreement

exists as of the date hereof. In the event that the Secured Revolving Credit

Agreement shall be modified or any of the provisions thereof shall be waived,

and KeyBank shall have approved the amendment or waiver thereunder in writing,

then such amendment or waiver shall be deemed to be a part of the definition of

Secured Revolving Credit Agreement. In the event that the Secured Revolving

Credit Agreement shall terminate or otherwise be of no force or effect, then the

obligation of the Borrower and Guarantor hereunder to perform each and every

covenant therein shall survive notwithstanding such termination. Upon the

request of the Agent, the Borrower and Guarantor shall enter into such

amendments to the Loan Documents as Agent may reasonably request to incorporate

some or all of the representations, warranties and covenants of the Secured

Revolving Credit Agreement into the Loan Documents.

 

     Security Deeds. The Mortgages, Deeds to Secure Debt and Deeds of Trust from

the Borrower to the Agent for the benefit of the Banks (or to trustees named

therein acting on behalf of the Agent for the benefit of the Banks), as the same

may be modified or amended, pursuant to which the Borrower has conveyed a

Collateral Property as security for the Obligations of the Borrower.

 

     Security Documents. The Assignment of Leases and Rents, the Security Deed,

the Indemnity Agreement, the Guaranty, and any further collateral assignments to

the Agent for the benefit of the Banks, including, without limitation, UCC-1

financing statements executed and delivered in connection therewith.

 

     Service Agreement. Service agreements with third parties, whether written

or oral, relating to the operation, maintenance, security, finance or insurance

of Collateral Property.

 

     Short-term Investments. Investments described in subsections (a) through

(g), inclusive, of Section 8.3.

 

     State. A state of the United States of America.

 

     Subsidiary. Any corporation, association, partnership, trust, or other

business entity of which the designated parent shall at any time own directly or

indirectly through a Subsidiary or Subsidiaries at least a majority (by number

of votes or controlling interests) of the outstanding Voting Interests.

 

     Title Insurance Company. Chicago Title Insurance Company or another title

insurance company or companies approved by the Agent.

 

     Title Policy. With respect to each parcel of Collateral Property, the

mortgagee's title insurance policy issued to the holders of the Original Loan

insuring the priority of the Original Loan Documents as

 

 

                                       12

<PAGE>

endorsed to reflect the assignment of the Original Loan Documents to Agent and

the amendment of the Original Loan Documents.

 

     Total Commitment. The sum of the Commitments of the Banks, as in effect

from time to time. As of the date of this Agreement, the Total Commitment is

Ninety-Nine Million Three Hundred Sixteen Thousand Eight Hundred Thirty and

78/100 Dollars ($99,316,830.78).

 

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

 

     Voting Interests. Stock or similar ownership interests, of any class or

classes (however designated), the holders of which are at the time entitled, as

such holders, (a) to vote for the election of a majority of the directors (or

persons performing similar functions) of the corporation, association,

partnership, trust or other business entity involved, or (b) to control, manage,

or conduct the business of the corporation, partnership, association, trust or

other business entity involved.

 

     SECTION 1.2 RULES OF INTERPRETATION.

 

          (a) A reference to any document or agreement shall include such

document or agreement as amended, modified or supplemented from time to time in

accordance with its terms and the terms of this Agreement.

 

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

singular.

 

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

such law.

 

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

permitted assigns.

 

          (e) Accounting terms not otherwise defined herein have the meanings

assigned to them by generally accepted accounting principles applied on a

consistent basis by the accounting entity to which they refer.

 

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

 

          (g) The words "approval" and "approved", as the context so determines,

means an approval in writing given to the party seeking approval after full and

fair disclosure to the party giving approval of all material facts necessary in

order to determine whether approval should be granted.

 

          (h) All terms not specifically defined herein or by generally accepted

accounting principles, which terms are defined in the Uniform Commercial Code as

in effect in the State of Michigan, have the meanings assigned to them therein.

 

           (i) Reference to a particular " Section ", refers to that section of

this Agreement unless otherwise indicated.

 

          (j) The words "herein", "hereof", "hereunder" and words of like import

shall refer to this Agreement as a whole and not to any particular section or

subdivision of this Agreement.

 

SECTION 2. AGREEMENT TO MAKE ADVANCES; LIMITATIONS.

 

     SECTION 2.1 AGREEMENT TO MAKE ADVANCES. Subject to the terms and conditions

set forth in this Agreement, each of the Banks severally agrees to lend to the

Borrower (the "Loans"), and the Borrower

 

 

                                       13

<PAGE>

may borrow on the Closing Date upon submission by the Borrower to the Agent of a

Loan Request given in accordance with Section 2.5, up to a maximum aggregate

principal amount equal to such Bank's Commitment Percentage of such Loan to pay

for the purchase of the Original Loan Documents by Agent; provided, that, in all

events no Default or Event of Default shall have occurred and be continuing; and

provided, further that the Outstanding Loans (after giving effect to all amounts

requested) shall not at anytime exceed the Total Commitment. The Loans shall be

made pro rata in accordance with each Bank's Commitment Percentage. Each Loan

Request hereunder shall constitute a representation and warranty by the Borrower

that all of the conditions set forth in Section 10 and Section 11, in the case

of the initial Loan, and Section 11, in the case of all other Loans, have been

satisfied on the date of such request. Once repaid, sums hereunder may not be

reborrowed. There shall only be a single advance of the Loan.

 

     SECTION 2.2 [INTENTIONALLY OMITTED.]

 

     SECTION 2.3 NOTES. The Loans shall be evidenced by separate promissory

notes of the Borrower in substantially the form of Exhibit A hereto

(collectively, the "Notes"), dated of even date as this Agreement and completed

with appropriate insertions. One Note shall be payable to the order of each Bank

in the principal amount equal to such Bank's Commitment or, if less, the

outstanding amount of all Loans made by such Bank, plus interest accrued thereon

as set forth below. The Borrower irrevocably authorizes Agent to make or cause

to be made, at or about the time of the Drawdown Date of any Loan or at the time

of receipt of any payment of principal thereof, an appropriate notation on

Agent's Record reflecting the making of such Loan or (as the case may be) the

receipt of such payment. The outstanding amount of the Loans set forth on

Agent's Record shall be prima facie evidence of the principal amount thereof

owing and unpaid to each Bank, but the failure to record, or any error in so

recording, any such amount on Agent's Record shall not limit or otherwise affect

the obligations of the Borrower hereunder or under any Note to make payments of

principal of or interest on any Note when due.

 

     SECTION 2.4 INTEREST ON LOANS.

 

          (a) Each Base Rate Loan shall bear interest for the period commencing

with the Drawdown Date thereof and ending on the date on which such Base Rate

Loan is repaid or is converted to a LIBOR Rate Loan at the per annum rate equal

to the Base Rate.

 

          (b) Each LIBOR Rate Loan shall bear interest for the period commencing

with the Drawdown Date thereof and ending on the last day of the Interest Period

with respect thereto at the rate per annum equal to the sum of the LIBOR Rate

determined for such Interest Period plus one and four-tenths percent (1.40%).

 

          (c) The Borrower promises to pay interest on each Loan to it in

arrears on each Interest Payment Date with respect thereto, or on any earlier

date on which the Commitments shall terminate as provided in Section 2.8.

 

          (d) Base Rate Loans and LIBOR Rate Loans may be converted to Loans of

the other Type as provided in Section 4.1.

 

     SECTION 2.5 REQUESTS FOR LOANS. The Borrower (i) shall notify the Agent of

a potential request for a Loan as soon as possible prior to the Borrower's

proposed Drawdown Date, and (ii) shall give to the Agent written notice in the

form of Exhibit B hereto (or telephonic notice confirmed in writing in the form

of Exhibit B hereto) of each Loan requested hereunder (a "Loan Request") no less

than three (3) Business Days prior to the proposed Drawdown Date (provided,

however, such three (3) Business Days prior notice shall not be required with

respect to the Loan funded on the Closing Date). Each such notice shall specify

with respect to the requested Loan the proposed principal amount, Drawdown Date,

Interest

 

 

                                       14

<PAGE>

Period (if applicable) and Type. Each such notice shall also contain (i) a

statement as to the purpose for which such advance shall be or has been used

(which purpose shall be in accordance with the terms of Section 2.1), and (ii) a

certification by the Borrower and the chief financial or chief accounting

officer of Guarantor that the Borrower and Guarantor are and will be in

compliance with all covenants under the Loan Documents after giving effect to

the making of such Loan. Promptly upon receipt of any such notice, the Agent

shall notify each of the Banks thereof. Except as provided in this Section 2.5,

each such Loan Request shall be irrevocable and binding on the Borrower and

shall obligate the Borrower to accept the Loan requested from the Banks on the

proposed Drawdown Date, provided that, in addition to the Borrower's other

remedies against any Bank which fails to advance its proportionate share of a

requested Loan, such Loan Request may be revoked by the Borrower by notice

received by the Agent no later than the Drawdown Date if any Bank fails to

advance its proportionate share of the requested Loan in accordance with the

terms of this Agreement, provided further, that the Borrower shall be liable in

accordance with the terms of this Agreement to any Bank which is prepared to

advance its proportionate share of the requested Loan for any costs, expenses or

damages actually incurred by such Bank as a result of the Borrower's election to

revoke such Loan Request. Nothing herein shall prevent the Borrower from seeking

recourse against any Bank that fails to advance its proportionate share of a

requested Loan as required by this Agreement. The Borrower may without cost or

penalty revoke a Loan Request by delivering notice thereof to each of the Banks

no later than three (3) Business Days prior to the Drawdown Date. Each Loan

Request shall be (a) for a Base Rate Loan in the minimum aggregate amount of

$250,000 or an integral multiple of $100,000 in excess thereof, or (b) for a

LIBOR Rate Loan in a minimum aggregate amount of $250,000 or an integral

multiple of $100,000 in excess thereof; provided, however, that there shall be

no more than three (3) LIBOR Rate Loans outstanding at any one time.

 

     SECTION 2.6 FUNDS FOR LOANS.

 

          (a) Not later than 11:00 a.m. (Cleveland time) on the proposed

Drawdown Date of any Loans, each of the Banks will make available to the Agent,

at the Agent's Head Office, in immediately available funds, the amount of such

Bank's Commitment Percentage of the amount of the requested Loans which may be

disbursed pursuant to Section 2.1. Upon receipt from each Bank of such amount,

and upon receipt of the documents required by Section 10 and Section 11 and the

satisfaction of the other conditions set forth therein, to the extent

applicable, the Agent will make available to the Borrower the aggregate amount

of such Loans made available to the Agent by the Banks by crediting such amount

to the account of the Borrower maintained at the Agent's Head Office. The

failure or refusal of any Bank to make available to the Agent at the aforesaid

time and place on any Drawdown Date the amount of its Commitment Percentage of

the requested Loans shall not relieve any other Bank from its several obligation

hereunder to make available to the Agent the amount of such other Bank's

Commitment Percentage of any requested Loans, including any additional Loans

that may be requested subject to the terms and conditions hereof to provide

funds to replace those not advanced by the Bank so failing or refusing, provided

that the Borrower may by notice received by the Agent no later than the Drawdown

Date refuse to accept any Loan which is not fully funded in accordance with the

Borrower's Loan Request subject to the terms of Section 2.5. In the event of any

such failure or refusal, the Banks not so failing or refusing shall be entitled

to a priority secured position as against the Bank or Banks so failing or

refusing for such Loans as provided in Section 12.6.

 

          (b) Unless the Agent shall have been notified by any Bank prior to the

applicable Drawdown Date that such Bank will not make available to the Agent

such Bank's pro rata share of a proposed Loan, the Agent may in its discretion

assume that such Bank has made such share of the proposed Loan available to

Agent in accordance with the provisions of this Agreement and the Agent may, if

it chooses, in reliance upon such assumption make such Loan available to

Borrower, and such Bank shall be liable to the Agent for the amount of such

advance. If such Bank does not pay such

 

 

                                       15

<PAGE>

corresponding amount upon the Agent's demand therefor, the Agent will promptly

notify the Borrower, and the Borrower shall promptly pay such corresponding

amount to the Agent. The Agent shall also be entitled to recover from the Bank

or the Borrower, as the case may be, interest on such corresponding amount in

respect of each day from the date such corresponding amount was made available

by the Agent to the Borrower to the date such corresponding amount is recovered

by the Agent at a per annum rate equal to (i) from the Borrower at the

applicable rate for such Loan or (ii) from a Bank at the Federal Funds Effective

Rate.

 

     SECTION 2.7 ADVANCES DO NOT CONSTITUTE A WAIVER. No Loan made by the Banks

shall constitute a waiver of any of the conditions to the Banks' obligation to

make further Loans nor, in the event the Borrower fails to satisfy any such

condition, shall any such Loan have the effect of precluding the Banks from

thereafter declaring such failure to satisfy a condition to be an Event of

Default.

 

     SECTION 2.8 REDUCTION OF COMMITMENTS. The Borrower shall have the right at

any time and from time to time upon three Business Days' prior written notice to

the Agent to reduce by $250,000.00 or an integral multiple of $100,000.00 in

excess thereof (provided that in no event shall the aggregate Commitments be

reduced to an amount less than $25,000,000.00) or to terminate entirely the

unborrowed portion of the Commitments, whereupon the Commitments of the Banks

shall be reduced pro rata in accordance with their respective Commitment

Percentages of the amount specified in such notice or, as the case may be,

terminated, any such reduction to be without penalty. Promptly after receiving

any notice of the Borrower delivered pursuant to this Section 2.8, the Agent

will notify the Banks of the substance thereof. Additionally, upon the Agent's

and/or a Bank's receipt of any prepayments of all or a portion of the Loans

pursuant to Section 3.2, Section 3.3 or Section 5.2, the Commitments of the

Banks shall be reduced pro rata in accordance with their respective Commitment

Percentages of the amount prepaid, any such reduction to be without penalty.

Upon the effective date of any such termination in full, the Borrower shall pay

to the Agent for the respective accounts of the Banks the full amount of any

facility fee under Section 2.2 then accrued. No reduction or termination of the

Commitments may be reinstated. Any reduction of the Commitments pursuant to this

Agreement shall be allocated pro rata among the Banks in accordance with their

Commitment Percentages.

 

SECTION 3. REPAYMENT OF THE LOANS.

 

     SECTION 3.1 STATED MATURITY. The Borrower promises to pay on the Maturity

Date and there shall become absolutely due and payable on the Maturity Date all

of the Loans outstanding on such date, together with any and all accrued and

unpaid interest thereon.

 

     SECTION 3.2 MANDATORY PREPAYMENTS.

 

          (a) If at any time the aggregate of the Outstanding Loans exceeds the

Total Commitment, then the Borrower shall pay the amount of such excess to the

Agent for the respective accounts of the Banks for application to the Loans

within five (5) Business Days after receipt of notice of such Default from Agent

or the Majority Banks.

 

          (b) Except as permitted by Section 5.2, if at any time there shall

occur, whether voluntarily, involuntarily or by operation of law, a sale,

transfer, assignment, conveyance, option or other disposition of, or any

mortgage, hypothecation, encumbrance, financing or refinancing of (i) any

Collateral Property or (ii) any of the Collateral, except for Permitted Liens of

the type described in clauses (ii), (vii) and (viii) of the definition thereof,

all of the Obligations outstanding on such date, together with any and all

accrued but unpaid interest thereon and prepayment fees shall become absolutely

due and payable.

 

 

                                       16

<PAGE>

          (c) If at any time the Secured Revolving Credit Agreement is

terminated or any of the "Commitments" (as defined in the Secured Revolving

Credit Agreement) are terminated, then all of the Obligations outstanding on

such date, together with any and all accrued but unpaid interest thereon and

other amounts due and payable under this Agreement, shall become absolutely due

and payable, and the obligation of the Banks to any other advances of the Loan

shall automatically terminate.

 

     SECTION 3.3 OPTIONAL PREPAYMENTS. The Borrower shall have the right, at its

election, to prepay the outstanding amount of the applicable Loans, as a whole

or in part, at any time without penalty or premium; provided, that the full or

partial prepayment of the outstanding amount of any LIBOR Rate Loans pursuant to

this Section 3.3 may be made only on the last day of the Interest Period

relating thereto except as otherwise required pursuant to Section 4.7. The

Borrower shall give the Agent, no later than 10:00 a.m., Cleveland time, at

least five (5) Business Days' prior written notice of any prepayment pursuant to

this Section 3.3, in each case specifying the proposed date of payment of Loans

and the principal amount to be paid.

 

     SECTION 3.4 PARTIAL PREPAYMENTS. Each partial prepayment of the Loans under

Section 3.2 and Section 3.3 shall be an integral multiple of $100,000, shall be

accompanied by the payment of accrued interest on the principal prepaid to the

date of payment and, after payment of such interest, shall be applied, in the

absence of instruction by the Borrower, first to the principal of Base Rate

Loans and then to the principal of LIBOR Rate Loans.

 

     SECTION 3.5 EFFECT OF PREPAYMENTS. Amounts of the Loans hereunder may not

be reborrowed. Except as otherwise expressly provided herein, all payments shall

first be applied to accrued but unpaid interest and then to principal as

provided above.

 

SECTION 4. CERTAIN GENERAL PROVISIONS.

 

     SECTION 4.1 CONVERSION OPTIONS.

 

          (a) The Borrower may elect from time to time to convert any of its

outstanding Loans to a Loan of another Type and such Loan shall thereafter bear

interest as a Base Rate Loan or a LIBOR Rate Loan, as applicable; provided that

(i) with respect to any such conversion of a LIBOR Rate Loan to a Base Rate

Loan, the Borrower shall give the Agent at least three (3) Business Days' prior

written notice of such election, and such conversion shall only be made on the

last day of the Interest Period with respect to such LIBOR Rate Loan; (ii) with

respect to any such conversion of a Base Rate Loan to a LIBOR Rate Loan the

Borrower shall give the Agent at least four (4) LIBOR Business Days' prior

written notice of such election and the Interest Period requested for such Loan,

the principal amount of the Loan so converted shall be in a minimum aggregate

amount of $500,000 or an integral multiple of $100,000 in excess thereof and,

after giving effect to the making of such Loan there shall be no more than three

(3) LIBOR Rate Loans outstanding at any one time; and (iii) no Loan may be

converted into a LIBOR Rate Loan when any Default or Event of Default has

occurred and is continuing. All or any part of the outstanding Loans of any Type

may be converted as provided herein, provided that no partial conversion shall

result in a Base Rate Loan in an aggregate principal amount of less than

$500,000 or a LIBOR Rate Loan in an aggregate principal amount of less than

$500,000 and that the aggregate principal amount of each Loan shall be in an

integral multiple of $100,000. On the date on which such conversion is being

made, each Bank shall take such action as is necessary to transfer its

Commitment Percentage of such Loans to its Domestic Lending Office or its LIBOR

Lending Office, as the case may be. Each Conversion Request relating to the

conversion of a Base Rate Loan to a LIBOR Rate Loan shall be irrevocable by the

Borrower.

 

          (b) Any Loan may be continued as such Type upon the expiration of an

Interest Period with respect thereto by compliance by the Borrower with the

terms of Section 4.1(a); provided that no

 

 

                                       17

<PAGE>

LIBOR Rate Loan may be continued as such when any Default or Event of Default

has occurred and is continuing, but shall be automatically converted to a Base

Rate Loan on the last day of the Interest Period relating thereto ending during

the continuance of any Default or Event of Default.

 

          (c) In the event that the Borrower does not notify the Agent of its

election hereunder with respect to any Loan to it, such Loan shall be

automatically converted to a Base Rate Loan at the end of the applicable

Interest Period.

 

     SECTION 4.2 BREAK-UP FEE. The Borrower shall pay to KeyBank certain fees

for services rendered or to be rendered in connection with the Loan as provided

pursuant to the Agreement Regarding Fees dated of even date herewith between the

Borrower and KeyBank.

 

     SECTION 4.3 [INTENTIONALLY OMITTED.]

 

     SECTION 4.4 FUNDS FOR PAYMENTS.

 

          (a) All payments of principal, interest, unused facility fees, closing

fees and any other amounts due hereunder or under any of the other Loan

Documents shall be made to the Agent, for the respective accounts of the Banks

and the Agent, as the case may be, at the Agent's Head Office, not later than

1:00 p.m. (Cleveland time) on the day when due, in each case in lawful money of

the United States in immediately available funds. The Agent is hereby authorized

to charge the accounts of the Borrower with KeyBank designated by the Borrower,

on the dates when the amount thereof shall become due and payable, with the

amounts of the principal of and interest on the Loans and all fees, charges,

expenses and other amounts owing to the Agent and/or the Banks under the Loan

Documents.

 

          (b) All payments by the Borrower hereunder and under any of the other

Loan Documents shall be made without setoff or counterclaim and free and clear

of and without deduction for any taxes, levies, imposts, duties, charges, fees,

deductions, withholdings, compulsory loans, restrictions or conditions of any

nature now or hereafter imposed or levied by any jurisdiction or any political

subdivision thereof or taxing or other authority therein unless the Borrower is

compelled by law to make such deduction or withholding. If any such obligation

is imposed upon the Borrower with respect to any amount payable by them

hereunder or under any of the other Loan Documents, the Borrower will pay to the

Agent, for the account of the Banks or (as the case may be) the Agent, on the

date on which such amount is due and payable hereunder or under such other Loan

Document, such additional amount in Dollars as shall be necessary to enable the

Banks or the Agent to receive the same net amount which the Banks or the Agent

would have received on such due date had no such obligation been imposed upon

the Borrower. The Borrower will deliver promptly to the Agent certificates or

other valid vouchers for all taxes or other charges deducted from or paid with

respect to payments made by the Borrower hereunder or under such other Loan

Document.

 

     SECTION 4.5 COMPUTATIONS. All computations of interest on the Loans and of

other fees to the extent applicable shall be based on a 360-day year and paid

for the actual number of days elapsed. Except as otherwise provided in the

definition of the term "Interest Period" with respect to LIBOR Rate Loans,

whenever a payment hereunder or under any of the other Loan Documents becomes

due on a day that is not a Business Day, the due date for such payment shall be

extended to the next succeeding Business Day, and interest shall accrue during

such extension. The outstanding amount of the Loans as reflected on the records

of the Agent from time to time shall be considered prima facie evidence of such

amount.

 

     SECTION 4.6 INABILITY TO DETERMINE LIBOR RATE. In the event that, prior to

the commencement of any Interest Period relating to any LIBOR Rate Loan, the

Agent shall reasonably determine that adequate and reasonable methods do not

exist for ascertaining the LIBOR Rate for such Interest Period, the Agent

 

 

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shall forthwith give notice of such determination (which shall be conclusive and

binding on the Borrower and the Banks) to the Borrower and the Banks. In such

event (a) any Loan Request with respect to LIBOR Rate Loans shall be

automatically withdrawn and shall be deemed a request for Base Rate Loans and

(b) each LIBOR Rate Loan will automatically, on the last day of the then current

Interest Period thereof, become a Base Rate Loan, and the obligations of the

Banks to make LIBOR Rate Loans shall be suspended until the Agent determines

that the circumstances giving rise to such suspension no longer exist, whereupon

the Agent shall so notify the Borrower and the Banks.

 

     SECTION 4.7 ILLEGALITY. Notwithstanding any other provisions herein, if any

present or future law, regulation, treaty or directive or the interpretation or

application thereof shall make it unlawful, or any central bank or other

governmental authority having jurisdiction over a Bank or its LIBOR Lending

Office shall assert that it is unlawful, for any Bank to make or maintain LIBOR

Rate Loans, such Bank shall forthwith give notice of such circumstances to the

Agent and the Borrower and thereupon (a) the commitment of the Banks to make

LIBOR Rate Loans or convert Loans of another type to LIBOR Rate Loans shall

forthwith be suspended and (b) the LIBOR Rate Loans then outstanding shall be

converted automatically to Base Rate Loans on the last day of each Interest

Period applicable to such LIBOR Rate Loans or within such earlier period as may

be required by law.

 

     SECTION 4.8 ADDITIONAL INTEREST. If any LIBOR Rate Loan or any portion

thereof is repaid, or is converted to a Base Rate Loan for any reason on a date

which is prior to the last day of the Interest Period applicable to such LIBOR

Rate Loan, or if repayment of the Loans has been accelerated as provided in

Section 12.1, the Borrower will pay to the Agent upon demand for the account of

the Banks in accordance with their respective Commitment Percentages, in

addition to any amounts of interest otherwise payable hereunder, any amounts

required to compensate the Banks for any losses, costs or expenses which may

reasonably be incurred as a result of such payment or conversion, including,

without limitation, an amount equal to daily interest for the unexpired portion

of such Interest Period on the LIBOR Rate Loan or portion thereof so repaid or

converted at a per annum rate equal to the excess, if any, of (a) the interest

rate calculated on the basis of the LIBOR Rate applicable to such LIBOR Rate

Loan minus (b) the yield obtainable by the Agent upon the purchase of debt

securities customarily issued by the Treasury of the United States of America

which have a maturity date most closely approximating the last day of such

Interest Period (it being understood that the purchase of such securities shall

not be required in order for such amounts to be payable and that a Bank shall

not be obligated or required to have actually obtained funds at the LIBOR Rate

or to have actually reinvested such amounts as described above). Such amount

shall be reduced to present value by using the rate on the United States

Treasury securities described in the foregoing sentence and the number of days

remaining in the unexpired portion of the Interest Period in question.

 

     SECTION 4.9 ADDITIONAL COSTS, ETC. Notwithstanding anything herein to the

contrary, if any present or future applicable law, or any amendment or

modification of present applicable law, which expression, as used herein,

includes statutes, rules and regulations thereunder and legally binding

interpretations thereof by any competent court or by any governmental or other

regulatory body or official with appropriate jurisdiction charged with the

administration or the interpretation thereof and requests, directives,

instructions and notices at any time or from time to time hereafter made upon or

otherwise issued to any Bank or the Agent by any central bank or other fiscal,

monetary or other authority (whether or not having the force of law), shall:

 

          (a) subject any Bank or the Agent to any tax, levy, impost, duty,

charge, fee, deduction or withholding of any nature with respect to this

Agreement, the other Loan Documents, such Bank's Commitment, or the Loans (other

than taxes based upon or measured by the income or profits of such Bank or the

Agent), or

 

 

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<PAGE>

          (b) materially change the basis of taxation (except for changes in

taxes on income or profits) of payments to any Bank of the principal of or the

interest on any Loans or any other amounts payable to any Bank under this

Agreement or the other Loan Documents, or

 

          (c) impose or increase or render applicable any special deposit,

reserve, assessment, liquidity, capital adequacy or other similar requirements

(whether or not having the force of law) against assets held by, or deposits in

or for the account of, or loans by, or commitments of an office of any Bank, or

 

          (d) impose on any Bank or the Agent any other conditions or

requirements with respect to this Agreement, the other Loan Documents, the

Loans, such Bank's Commitment, or any class of loans or commitments of which any

of the Loans or such Bank's Commitment forms a part; and the result of any of

the foregoing is

 

               (i) to increase the cost to any Bank of making, funding, issuing,

          renewing, extending or maintaining any of the Loans, or such Bank's

          Commitment, or

 

               (ii) to reduce the amount of principal, interest or other amount

          payable to such Bank or the Agent hereunder on account of such Bank's

          Commitment or any of the Loans, or

 

               (iii) to require such Bank or the Agent to make any payment or to

          forego any interest or other sum payable hereunder, the amount of

          which payment or foregone interest or other sum is calculated by

          reference to the gross amount of any sum receivable or deemed received

          by such Bank or the Agent from the Borrower hereunder,

 

then, and in each such case, the Borrower will within fifteen (15) days after

demand made by such Bank or (as the case may be) the Agent at any time and from

time to time and as often as the occasion therefor may arise, pay to such Bank

or the Agent such additional amounts as such Bank or the Agent shall determine

in good faith to be sufficient to compensate such Bank or the Agent for such

additional cost, reduction, payment or foregone interest or other sum. Each Bank

and the Agent in determining such amounts may use any reasonable averaging and

attribution methods, generally applied by such Bank or the Agent.

 

     SECTION 4.10 CAPITAL ADEQUACY. If after the date hereof any Bank determines

that (a) the adoption of or change in any law, rule, regulation or guideline

regarding capital requirements for banks or bank holding companies or any change

in the interpretation or application thereof by any governmental authority

charged with the administration thereof, or (b) compliance by such Bank or its

parent bank holding company with any guideline, request or directive of any such

entity regarding capital adequacy (whether or not having the force of law), has

the effect of reducing the return on such Bank's or such holding company's

capital as a consequence of such Bank's commitment to make Loans hereunder to a

level below that which such Bank or holding company could have achieved but for

such adoption, change or compliance (taking into consideration such Bank's or

such holding company's then existing policies with respect to capital adequacy

and assuming the full utilization of such entity's capital) by any amount deemed

by such Bank to be material, then such Bank may notify the Borrower thereof. The

Borrower agrees to pay to such Bank the amount of such reduction in the return

on capital as and when such reduction is determined, upon presentation by such

Bank of a statement of the amount and setting forth such Bank's calculation

thereof. In determining such amount, such Bank may use any reasonable averaging

and attribution methods.

 

 

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<PAGE>

     SECTION 4.11 INDEMNITY OF BORROWER. The Borrower agrees to indemnify each

Bank and to hold each Bank harmless from and against any loss, cost or expense

that such Bank may sustain or incur as a consequence of (a) default by the

Borrower in payment of the principal amount of or any interest on any LIBOR Rate

Loans as and when due and payable, including any such loss or expense arising

from interest or fees payable by such Bank to lenders of funds obtained by it in

order to maintain its LIBOR Rate Loans, or (b) default by the Borrower in making

a borrowing or conversion after the Borrower has given (or is deemed to have

given) a Loan Request or a Conversion Request.

 

     SECTION 4.12 INTEREST ON OVERDUE AMOUNTS; LATE CHARGE. Overdue principal on

the Loans and all other overdue amounts payable hereunder or under any of the

other Loan Documents (other than interest on the Loans) shall, following the

expiration of any applicable cure period expressly provided for in this

Agreement, bear interest payable on demand at a rate per annum equal to two

percent (2.0%) above the rate that would otherwise be applicable at such time

until such amount shall be paid in full (after as well as before judgment).

Overdue interest on the Loans shall, following the expiration of any applicable

cure period expressly provided for in this Agreement, bear interest payable on

demand at a rate equal to the lesser of (i) a per annum rate equal to two

percent (2.0%) above the rate that would otherwise be applicable at such time or

(ii) the maximum annual rate of interest permitted by applicable law until such

amount shall be paid in full (after as well as before judgment). In addition,

the Borrower shall pay a late charge equal to four percent (4.0%) of any amount

of interest and/or principal payable on the Loans or any other amounts payable

hereunder or under the Loan Documents, which is not paid by the Borrower within

fifteen (15) days after the same shall become due and payable.

 

     SECTION 4.13 HLT CLASSIFICATION. The Banks acknowledge that as of the date

hereof neither the Commitments nor the Loans are classified as "highly leveraged

transactions". Notwithstanding the foregoing, if after the date hereof, the

Agent determines, or is advised by any Bank that such Bank has determined or has

received notice from any governmental authority, central bank or comparable

agency having jurisdiction over such Bank, that any of the Commitments or Loans

are classified as a "highly leveraged transaction" (an "HLT Classification")

pursuant to any existing regulations regarding "highly leveraged transactions"

or any modification, amendment or interpretation thereof, or the adoption of new

regulations regarding "highly leveraged transactions" after the date hereof by

any governmental authority, central bank or comparable agency, the Agent shall

promptly give notice of such HLT Classification to the Borrower and the Banks

(which date is hereafter referred to as the "HLT Notice Date"). The Agent, the

Banks and the Borrower shall thereupon commence negotiations in good faith to

agree on the extent to which fees, interest rates and/or margins hereunder

should be increased so as to reflect such HLT Classification. If the Borrower

and the Majority Banks agree on the amount of such increase or increases, this

Agreement shall be promptly amended to give effect to such increase or

increases. If the Borrower and the Majority Banks fail to so agree and the

Borrower has failed to refinance the Loans within ninety (90) days after the HLT

Notice Date, then the Agent shall, if so requested by the Majority Banks, by

notice to the Borrower terminate the Commitments and accelerate the maturity

date of the Loans and the Loans shall become due and payable in full on the date

specified in such notice, which date shall be not earlier than one hundred

eighty (180) days after the HLT Notice Date. The Agent and the Banks acknowledge

that an HLT Classification is not a Default or an Event of Default.

 

     SECTION 4.14 CERTIFICATE. A certificate setting forth any amounts payable

pursuant to Section 4.8, Section 4.9, Section 4.10, Section 4.11, Section 4.12

or Section 4.13 and a brief explanation of such amounts which are due, submitted

by any Bank or the Agent to the Borrower, shall be conclusive in the absence of

manifest error.

 

     SECTION 4.15 LIMITATION ON INTEREST. Notwithstanding anything in this

Agreement to the contrary, all agreements between the Borrower and the Banks and

the Agent, whether now existing or hereafter arising and whether written or

oral, are hereby limited so that in no contingency, whether by reason of

acceleration of the maturity of any of the Obligations or otherwise, shall the

interest contracted for,

 

 

                                       21

<PAGE>

charged or received by the Banks exceed the maximum amount permissible under

applicable law. If, from any circumstance whatsoever, interest would otherwise

be payable to the Banks in excess of the maximum lawful amount, the interest

payable to the Banks shall be reduced to the maximum amount permitted under

applicable law; and if from any circumstance the Banks shall ever receive

anything of value deemed interest by applicable law in excess of the maximum

lawful amount, an amount equal to any excessive interest shall be applied to the

reduction of the principal balance of the Obligations of the Borrower and to the

payment of interest or, if such excessive interest exceeds the unpaid balance of

principal of the Obligations of the Borrower, such excess shall be refunded to

the Borrower. All interest paid or agreed to be paid to the Banks shall, to the

extent permitted by applicable law, be amortized, prorated, allocated and spread

throughout the full period until payment in full of the principal of the

Obligations of the Borrower (including the period of any renewal or extension

thereof) so that the interest thereon for such full period shall not exceed the

maximum amount permitted by applicable law. This section shall control all

agreements between the Borrower and the Banks and the Agent.

 

SECTION 5. COLLATERAL SECURITY.

 

     SECTION 5.1 COLLATERAL. The Obligations of the Borrower shall be secured by

(i) a perfected first priority lien or security interest to be held by the Agent

for the benefit of the Banks in the Collateral Property pursuant to the terms of

the Security Deeds, (ii) the Indemnity Agreement; and (iii) such additional

collateral, if any, the Agent for the benefit of the Banks from time to time may

accept as security for the Obligations with the consent of the Majority Banks,

which consent may be given or withheld in the sole discretion of the Majority

Banks. The Obligations shall also be guaranteed pursuant to the terms of the

Guaranty.

 

     SECTION 5.2 RELEASE OF COLLATERAL.

 

          (a) Upon termination of this Agreement and the Commitment of the Banks

to make Loans and, the payment in full of all of the Obligations, the Agent, on

behalf of the Banks, shall release the Collateral and shall execute such

instruments of release as the Borrower and its counsel may reasonably request.

 

          (b) Provided no Default or Event of Default shall have occurred

hereunder and be continuing (or would exist immediately after giving effect to

the transactions contemplated by this Section 5.2), the Agent shall release the

Collateral Properties commonly known as Jackson West, New Towne Plaza and West

Oaks from the lien or security title of the Security Documents encumbering the

same in connection with the planned CMBS refinancing of such properties upon the

request of the Borrower subject to and upon the following terms and conditions:

 

               (i) the Borrower shall deliver to the Agent written notice of its

          desire to obtain such release no later than three (3) days prior to

          the date on which such release is to be effected;

 

               (ii) the Borrower shall submit to the Agent with such request a

          Compliance Certificate prepared using the financial statements of the

          Borrower and Guarantor most recently provided or required to be

          provided to the Agent under Section 6.4 or Section 7.4 adjusted in the

          best good faith estimate of the Borrower to give effect to the

          proposed release and demonstrating that no Default or Event of Default

          with respect to the covenants in this Agreement shall exist after

          giving effect to such release;

 

               (iii) all release documents to be executed by the Agent shall be

          in form and substance reasonably satisfactory to the Agent;

 

 

                                       22

<PAGE>

               (iv) the Borrower shall pay all reasonable costs and expenses of

          the Agent in connection with such release, including without

          limitation, reasonable attorney's fees; and

 

               (v) the Borrower shall pay to the Agent for the account of the

          Banks a release price, which payment shall be applied to reduce the

          outstanding principal balance of the Loans, in an amount equal to

          fifty percent (50%) of the Net Proceeds from the refinancing of such

          properties.

 

SECTION 6. REPRESENTATIONS AND WARRANTIES OF THE GUARANTOR AND THE BORROWER.

 

     The Borrower and Guarantor hereby reaffirm as of the date hereof each and

every representation and warranty set forth in the Secured Revolving Credit

Agreement as if the same were more fully set forth herein, and jointly and

severally, represent and warrant to the Agent and the Banks as follows.

 

     SECTION 6.1 CORPORATE AUTHORITY, ETC.

 

          (a) Incorporation; Good Standing. The Borrower is a Delaware limited

partnership duly organized pursuant to its first amended and restated limited

partnership agreement dated May 10, 1996, as amended by amendments one through

twenty, and a Certificate of Limited Partnership and amendments thereto filed

with the Secretary of the State of Delaware and is validly existing and in good

standing under the laws of the State of Delaware. Guarantor is a Maryland real

estate investment trust duly organized pursuant to its trust declaration dated

October 2, 1997, as amended and supplemented, and a Certificate of Trust filed

with the Secretary of the State of Maryland and is validly existing and in good

standing under the laws of the State of Maryland. Each of the Borrower and the

Guarantor (i) has all requisite power to own its respective properties and

interests and conduct its respective business as now conducted and as presently

contemplated, and (ii) as to the Borrower is in good standing as a foreign

entity and is duly authorized to do business in each other jurisdiction where a

failure to be so qualified in such other jurisdiction could have a materially

adverse effect on the business, assets or financial condition of such Person.

Guarantor is a real estate investment trust in full compliance with and entitled

to the benefits of Section 856 of the Code.

 

          (b) Subsidiaries. Each of the Subsidiaries of the Borrower and the

Guarantor (i) is a corporation, limited partnership, limited liability company

or trust duly organized under the laws of its State of organization and is

validly existing and in good standing under the laws thereof, (ii) has all

requisite power to own its property and interests and conduct its business as

now conducted and as presently contemplated and (iii) is in good standing and is

duly authorized to do business in each jurisdiction where assets held by it are

located and in each other jurisdiction where a failure to be so qualified could

have a materially adverse effect on the business, assets or financial condition

of the Borrower, the Guarantor, or such Subsidiary.

 

          (c) Authorization. The execution, delivery and performance of this

Agreement and the other Loan Documents to which the Borrower, the Guarantor or

any of their respective Subsidiaries is or is to become a party and the

transactions contemplated hereby and thereby (i) are within the authority of

such Person, (ii) have been duly authorized by all necessary proceedings on the

part of such Person, (iii) do not and will not conflict with or result in any

breach or contravention of any provision of law, statute, rule or regulation to

which such Person is subject or any judgment, order, writ, injunction, license

or permit applicable to such Person, (iv) do not and will not conflict with or

constitute a default (whether with the passage of time or the giving of notice,

or both) under any provision of the articles of incorporation, partnership

agreement, declaration of trust or other charter documents or bylaws of, or any

 

 

                                       23

<PAGE>

agreement or other instrument binding upon, such Person or any of its

properties, and (v) do not and will not result in or require the imposition of

any lien or other encumbrance on any of the properties, assets or rights of such

Person.

 

          (d) Enforceability. The execution and delivery of this Agreement and

the other Loan Documents to which the Borrower, the Guarantor or any of their

respective Subsidiaries is or is to become a party are valid and legally binding

obligations of such Person enforceable in accordance with the respective terms

and provisions hereof and thereof, except as enforceability is limited by

bankruptcy, insolvency, reorganization, moratorium or other laws relating to or

affecting generally the enforcement of creditors' rights and except to the

extent that availability of the remedy of specific performance or injunctive

relief is subject to the discretion of the court before which any proceeding

therefor may be brought.

 

     SECTION 6.2 GOVERNMENTAL APPROVALS. The execution, delivery and performance

of this Agreement and the other Loan Documents to which the Borrower, the

Guarantor or any of their respective Subsidiaries is or is to become a party and

the transactions contemplated hereby and thereby do not require the approval or

consent of, or filing with, any governmental agency or authority other than

those already obtained and the filing of the Security Documents in the

appropriate records office with respect thereto.

 

     SECTION 6.3 TITLE TO PROPERTIES; LEASE. The Borrower, the Guarantor and

their Subsidiaries own all of the assets reflected in the consolidated balance

sheet of the Borrower and the Guarantor as of the Balance Sheet Date or acquired

since that date (except property and assets sold or otherwise disposed of in the

ordinary course of business since that date), subject to no rights of others,

including any mortgages, leases, conditional sales agreements, title retention

agreements, liens or other encumbrances except Permitted Liens.

 

     SECTION 6.4 FINANCIAL STATEMENTS. The Borrower has delivered to each of the

Banks: (a) the consolidated balance sheet of the Borrower and the Guarantor and

their respective Subsidiaries as of the Balance Sheet Date, (b) an unaudited

operating statement for each of the Collateral Properties for the period of

January 1, 2005 through June 30, 2005, to the extent available, satisfactory in

form to the Agent and certified by the Borrower as fairly presenting the

operating income from such properties for such periods, and (c) certain other

financial information relating to the Borrower, the Guarantor, their

Subsidiaries and the Real Estate. Such balance sheet and statements have been

prepared in accordance with generally accepted accounting principles and fairly

present the financial condition of the Borrower, the Guarantor and their

respective Subsidiaries as of such dates and the results of the operations of

the Borrower, the Guarantor and the Collateral Properties for such periods.

Other than the bridge loan from KeyBank to Ramco River City, Inc. in the amount

of $9,000,000 closed July 11, 2005, there are no liabilities, contingent or

otherwise, of the Borrower, the Guarantor or any of their respective

Subsidiaries involving material amounts not disclosed in said financial

statements and the related notes thereto.

 

     SECTION 6.5 NO MATERIAL CHANGES. Since the Balance Sheet Date, there has

occurred no materially adverse change in the financial condition or business of

the Borrower, the Guarantor, and their respective Subsidiaries taken as a whole

as shown on or reflected in the consolidated balance sheet of the Borrower and

the Guarantor as of the Balance Sheet Date, or its consolidated statement of

income or cash flows for the fiscal year then ended, other than changes in the

ordinary course of business that have not had any materially adverse effect

either individually or in the aggregate on the business or financial condition

of such Person.

 

     SECTION 6.6 FRANCHISES, PATENTS, COPYRIGHTS, ETC. The Borrower, the

Guarantor and their respective Subsidiaries possess all franchises, patents,

copyrights, trademarks, trade names, servicemarks,

 

 

                                        24

<PAGE>

licenses and permits, and rights in respect of the foregoing, adequate for the

conduct of their business substantially as now conducted without known conflict

with any rights of others.

 

     SECTION 6.7 LITIGATION. Except as stated on Schedule 6.7 there are no

actions, suits, proceedings or investigations of any kind pending or to the

knowledge of such person threatened against the Borrower, the Guarantor or any

of their respective Subsidiaries before any court, tribunal, arbitrator,

mediator or administrative agency or board that, if adversely determined, might,

either in any case or in, the aggregate, materially adversely affect the

properties, assets, financial condition or business of such Person or materially

impair the right of such Person to carry on business substantially as now

conducted by it, or result in any liability not adequately covered by insurance,

or for which adequate reserves are not maintained on the balance sheet of such

Person, or which question the validity of this Agreement or any of the other

Loan Documents, any action taken or to be taken pursuant hereto or thereto or

any lien or security interest created or intended to be created pursuant hereto

or thereto, or which will adversely affect the ability of the Borrower or the

Guarantor to pay and perform the Obligations in the manner contemplated by this

Agreement and the other Loan Documents.

 

     SECTION 6.8 NO MATERIALLY ADVERSE CONTRACTS, ETC. None of the Borrower, the

Guarantor or any of their respective Subsidiaries is subject to any charter,

corporate or other legal restriction, or any judgment, decree, order, rule or

regulation that has or is expected in the future to have a materially adverse

effect on the business, assets or financial condition of such Person. None of

the Borrower, the Guarantor, nor any of their respective Subsidiaries is a party

to any contract or agreement that has or is expected, in the judgment of the

partners or officers of such Person, to have any materially adverse effect on

the business of any of them.

 

     SECTION 6.9 COMPLIANCE WITH OTHER INSTRUMENTS, LAWS, ETC. None of the

Borrower, the Guarantor or any of their respective Subsidiaries is in violation

of any provision of its charter or other organizational documents, bylaws, or

any agreement or instrument to which it may be subject or by which it or any of

its properties may be bound or any decree, order, judgment, statute, license,

rule or regulation, in any of the foregoing cases in a manner that could result

in the imposition of substantial penalties or materially and adversely affect

the financial condition, properties or business of such Person.

 

     SECTION 6.10 TAX STATUS. The Borrower, the Guarantor and each of their

respective Subsidiaries (a) has made or filed all federal and state income and

all other tax returns, reports and declarations required by any jurisdiction to

which it is subject, (b) has paid all taxes and other governmental assessments

and charges shown or determined to be due on such returns, reports and

declarations, except those being contested in good faith and by appropriate

proceedings and (c) has set aside on its books provisions reasonably adequate

for the payment of all taxes for periods subsequent to the periods to which such

returns, reports or declarations apply. There are no unpaid taxes in any

material amount claimed to be due by the taxing authority of any jurisdiction,

and the partners or officers of such Person know of no basis for any such claim.

 

     SECTION 6.11 NO EVENT OF DEFAULT. No Default or Event of Default has

occurred and is continuing.

 

     SECTION 6.12 HOLDING COMPANY AND INVESTMENT COMPANY ACTS. None of the

Borrower, the Guarantor, or any of their respective Subsidiaries is or after

giving effect to any Loan will be, subject to regulation under the Public

Utility Holding Company Act of 1935, the Federal Power Act or the Investment

Company Act of 1940 or to any federal or state statute or regulation limiting

its ability to incur indebtedness for borrowed money.

 

     SECTION 6.13 ABSENCE OF UCC FINANCING STATEMENTS, ETC. Except with respect

to Permitted Liens, there is no financing statement, security agreement, chattel

mortgage, real estate mortgage or other

 

 

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<PAGE>

document filed or recorded with any filing records, registry, or other public

office, that purports to cover, affect or give notice of any present or possible

future lien on, or security interest or security title in, any property of the

Borrower or rights thereunder.

 

      SECTION 6.14 SETOFF, ETC. The Collateral and the rights of the Agent and

the Banks with respect to the Collateral are not subject to any setoff, claims,

withholdings or other defenses. Borrower is the owner of the Collateral free

from any lien, security interest, encumbrance or other claim or demand, except

for Permitted Liens of the type described in clauses (ii), (vii) or (viii) of

the definition thereof.

 

     SECTION 6.15 CERTAIN TRANSACTIONS. Except as set forth on Schedule 6.15,

none of the officers, trustees, directors, or employees of the Borrower, the

Guarantor or any of their respective Subsidiaries is a party to any transaction

with either or both of the Borrower, the Guarantor or any of their respective

Subsidiaries (other than for services as employees, officers and directors),

including any contract, agreement or other arrangement providing for the

furnishing of services to or by, providing for rental of real or personal

property to or from, or otherwise requiring payments to or from any officer,

trustee, director or such employee or, to the knowledge of the Borrower, the

Guarantor, or any corporation, partnership, trust or other entity in which any

officer, trustee, director, or any such employee has a substantial interest or

is an officer, director, trustee or partner.

 

     SECTION 6.16 EMPLOYEE BENEFIT PLANS. The Borrower, the Guarantor and each

ERISA Affiliate has fulfilled its obligations under the minimum funding

standards of ERISA and the Code with respect to each Employee Benefit Plan,

Multiemployer Plan or Guaranteed Pension Plan and is in compliance in all

material respects with the presently applicable provisions of ERISA and the Code

with respect to each Employee Benefit Plan, Multiemployer Plan or Guaranteed

Pension Plan. Neither the Borrower, the Guarantor nor any ERISA Affiliate has

(a) sought a waiver of the minimum funding standard under Section 412 of the

Code in respect of any Employee Benefit Plan, Multiemployer Plan or Guaranteed

Pension Plan, (b) failed to make any contribution or payment to any Employee

Benefit Plan, Multiemployer Plan or Guaranteed Pension Plan, or made any

amendment to any Employee Benefit Plan, Multiemployer Plan or Guaranteed Pension

Plan, which has resulted or could result in the imposition of a lien or the

posting of a bond or other security under ERISA or the Code, or (c) incurred any

liability under Title IV of ERISA other than a liability to the PBGC for

premiums under Section 4007 of ERISA. None of the Real Estate constitutes a

"plan asset" of any Employee Benefit Plan, Multiemployer Plan or Guaranteed

Pension Plan.

 

     SECTION 6.17 REGULATIONS T, U AND X. No portion of any Loan is to be used

for the purpose of purchasing or carrying any "margin security" or "margin

stock" as such terms are used in Regulations T, U and X of the Board of

Governors of the Federal Reserve System, 12 C.F.R. Parts 220, 221 and 224.

 

     SECTION 6.18 ENVIRONMENTAL COMPLIANCE. The Borrower, Guarantor and each of

their respective Subsidiaries has taken all commercially reasonable steps to

investigate the past and present conditions and usage of the Real Estate and the

operations conducted thereon and, based upon such investigation makes the

following representations and warranties.

 

          (a) With respect to the Collateral Properties, and to the best of the

Borrower's and the Guarantor's knowledge with respect to any other Real Estate,

none of the Borrower, the Guarantor or their respective Subsidiaries or any

operator of the Real Estate, or any operations thereon is in violation, or

alleged violation, of any judgment, decree, order, law, license, rule or

regulation pertaining to environmental matters, including, without limitation,

those arising under the Resource Conservation and Recovery Act ("RCRA"), the

Comprehensive Environmental Response, Compensation and Liability Act of 1980 as

amended ("CERCLA"), the Superfund Amendments and Reauthorization Act of 1986

("SARA"), the Federal Clean Water Act, the Federal Clean Air Act, the Toxic

Substances Control Act, or

 

 

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any state or local statute, regulation, ordinance, order or decree relating to

the environment (hereinafter "Environmental Laws"), which violation involves any

of the Collateral Properties or involves other Real Estate and would have a

material adverse effect on the business, assets or financial condition of the

Borrower, the Guarantor or any of their respective Subsidiaries.

 

          (b) None of the Borrower, the Guarantor or any of their respective

Subsidiaries has received notice from any third party including, without

limitation, any federal, state or local governmental authority, (i) that it has

been identified by the United States Environmental Protection Agency ("EPA") as

a potentially responsible party under CERCLA with respect to a site listed on

the National Priorities List, 40 C.F.R. Part 300 Appendix B (1986); (ii) that

any hazardous waste, as defined by 42 U.S.C. Section 9601(5), any hazardous

substances as defined by 42 U.S.C. Section 9601(14), any pollutant or

contaminant as defined by 42 U.S.C. Section 9601(33) or any toxic substances,

oil or hazardous materials or other chemicals or substances regulated by any

Environmental Laws ("Hazardous Substances") which it has generated, transported

or disposed of have been found at any site at which a federal, state or local

agency or other third party has conducted or has ordered that the Borrower, the

Guarantor or any of their respective Subsidiaries conduct a remedial

investigation, removal or other response action pursuant to any Environmental

Law; or (iii) that it is or shall be a named party to any claim, action, cause

of action, complaint, or legal or administrative proceeding (in each case,

contingent or otherwise) arising out of any third party's incurrence of costs,

expenses, losses or damages of any kind whatsoever in connection with the

release of Hazardous Substances.

 

          (c) With respect to the Collateral Properties, and to the best of the

Borrower's and the Guarantor's knowledge with respect to any other Real Estate,

except as specifically set forth in the written environmental site assessment

reports provided to the Agent on or before the date hereof or as set forth on

Schedule 6.18 attached hereto or, in the case of Real Estate acquired after the

date hereof, the environmental site assessment reports with respect thereto

provided to the Agent under Section 10.12: (i) no portion of the Real Estate has

been used for the handling, processing, storage or disposal of Hazardous

Substances except in accordance with applicable Environmental Laws in all

material respects, and no underground tank or other underground storage

receptacle for Hazardous Substances is located on any portion of the Collateral

Property; (ii) in the course of any activities conducted by either the Borrower,

the Guarantor, their Subsidiaries or the operators of its properties, no

Hazardous Substances have been generated or are being used on the Real Estate

except in the ordinary course of business and in accordance with applicable

Environmental Laws in all material respects; (iii) there has been no past or

present releasing, spilling, leaking, pumping, pouring, emitting, emptying,

discharging, injecting, escaping, disposing or dumping (a "Release") or

threatened Release of Hazardous Substances on, upon, into or from any of the

Collateral Properties, or, to the best of the Borrower's or the Guarantor's

knowledge, on, upon, into or from the other properties of the Borrower, the

Guarantor or their respective Subsidiaries, which Release would have a material

adverse effect on the value of any of the Real Estate or adjacent properties or

the environment; (iv) to the best of the Borrower's or the Guarantor's

knowledge, there have been no Releases on, upon, from or into any real property

in the vicinity of any of the Real Estate which through soil or groundwater

contamination, may have come to be located on, and which would have a material

adverse effect on the value of, the Real Estate; and (v) any Hazardous

Substances that have been generated on any of the Real Estate have been

transported off-site only by carriers having an identification number issued by

the EPA or approved by a state or local environmental regulatory authority

having jurisdiction regarding the transportation of such substance and treated

or disposed of only by treatment or disposal facilities maintaining valid

permits as required under all applicable Environmental Laws, which transporters

and facilities have been and are, to the best of the Borrower's or the

Guarantor's knowledge, operating in compliance with such permits and applicable

Environmental Laws.

 

 

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          (d) None of the Borrower, the Guarantor, their respective

Subsidiaries, the Collateral Properties or any other Real Estate is subject to

any applicable Environmental Law requiring the performance of Hazardous

Substances site assessments, or the removal or remediation of Hazardous

Substances, or the giving of notice to any governmental agency or the recording

or delivery to other Persons of an environmental disclosure document or

statement by virtue of the transactions set forth herein and contemplated

hereby, or as a condition to the effectiveness of any transactions contemplated

hereby.

 

     SECTION 6.19 SUBSIDIARIES AND JOINT VENTURES. The organizational chart

attached as Schedule 6.19 sets forth all of the direct and indirect Subsidiaries

and joint ventures of the Borrower and the Guarantor. The form and jurisdiction

of organization of each of the Subsidiaries and joint ventures, and the

Borrower's and Guarantor's ownership interest therein, is set forth in said

Schedule 6.19. No Person owns any legal, equitable or beneficial interest in any

of the Persons set forth on Schedule 6.19, or has the right to vote or exercise

control over such Person or its management, except as set forth on such

Schedule.

 

     SECTION 6.20 [INTENTIONALLY OMITTED.]

 

     SECTION 6.21 LOAN DOCUMENTS. All of the representations and warranties made

by or on behalf of the Borrower, the Guarantor and their respective Subsidiaries

in this Agreement and the other Loan Documents or any document or instrument

delivered to the Agent or the Banks pursuant to or in connection with any of

such Loan Documents are true and correct in all material respects, and neither

the Borrower, the Guarantor nor any of their respective Subsidiaries has failed

to disclose such information as is necessary to make such representations and

warranties not misleading.

 

     SECTION 6.22 COLLATERAL PROPERTY. The Borrower makes the following

representations and warranties concerning each Collateral Property, to the

extent applicable, which are true and correct except where such failure to be

true and correct individually or in the aggregate would not have a material

adverse effect on (x) the value or marketability of such Collateral Property,

(y) the business, properties, assets, condition (financial or otherwise) or

results of operations of Borrower, or (z) the ability of Borrower to perform any

of its obligations under the Loan Documents:

 

          (a) Off-Site Utilities. All water, sewer, electric, gas, telephone and

other utilities necessary for the use and operation of the Collateral Property

are installed to the property lines of the Collateral Property through dedicated

public rights of way or through perpetual private easements approved by the

Agent and, except in the case of drainage facilities, are connected to the

Building located thereon with valid permits and are adequate to service the

Building in compliance with applicable law.

 

          (b) Access, Etc. The streets abutting the Collateral Property are

dedicated and accepted public roads, to which the Collateral Property has direct

access by trucks and other motor vehicles and by foot, or are perpetual private

ways (with direct access by trucks and other motor vehicles and by foot to

public roads) to which the Collateral Property has direct access approved by the

Agent. All private ways providing access to the Collateral Property are zoned in

a manner which will permit access to the Building over such ways by trucks and

other commercial and industrial vehicles.

 

          (c) Independent Building. The Building is fully independent in all

respects including, without limitation, in respect of structural integrity,

heating, ventilating and air conditioning, plumbing, mechanical and other

operating and mechanical systems, and electrical, sanitation and water systems,

all of which are connected directly to off-site utilities located in public

streets or ways or through insured perpetual private easements approved by the

Agent. The Building is located on a lot which is separately assessed for

purposes of real estate tax assessment and payment. The Building, all Building

 

 

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Service Equipment and all paved or landscaped areas related to or used in

connection with the Building are located wholly within the perimeter lines of

the lot or lots on which the Collateral Property is located, except as may be

specifically shown on the Survey for such Collateral Property.

 

          (d) Condition of Building; No Asbestos. The Building is, in all

material respects, structurally sound, in good repair and free of defects in

materials and workmanship. All major building systems located