MEZZANINE B LOAN AGREEMENT

Exhibit 10.8

MEZZANINE B LOAN AGREEMENT

Dated as of October 5, 2007

Between

THE ENTITIES IDENTIFIED IN EXHIBIT A ANNEXED HERETO ,
as Borrower

and

LEHMAN BROTHERS HOLDINGS INC.,
BANK OF AMERICA, N.A.
AND
BARCLAYS CAPITAL REAL ESTATE FINANCE INC. ,
as Lender

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MEZZANINE B LOAN AGREEMENT

THIS MEZZANINE B LOAN AGREEMENT , dated as of October 5, 2007 (as amended, restated, replaced, supplemented or otherwise modified from time to time, this “ Agreement ”), between LEHMAN BROTHERS HOLDINGS INC. , a Delaware corporation, having an address at 399 Park Avenue, New York, New York 10022 (“ Lehman ”), BANK OF AMERICA, N.A. , a national banking association, having an address at Hearst Tower, 214 North Tryon Street, Charlotte, North Carolina 28255 (“ BofA ”) and BARCLAYS CAPITAL REAL ESTATE FINANCE INC. , a Delaware corporation, having an address at 200 Park Avenue, New York, New York 10166 (“ Barclays ”; together with Lehman and BofA, individually and collectively, as the context may require, “ Lender ”), and THE ENTITIES IDENTIFIED IN EXHIBIT A ANNEXED HERETO , each having its principal place of business at c/o Archstone-Smith Operating Trust, 9200 E. Panorama Circle, Suite 400, Englewood, Colorado 80112 (each of such entities being referred to, individually, as a “ Borrower Entity ”, and all of such entities being referred to, collectively, as the “ Borrower Entities ” or “ Borrower ”).

W I T N E S S E T H:

WHEREAS, Borrower desires to obtain the Loan (as hereinafter defined) from Lender; and

WHEREAS, Lender is willing to make the Loan to Borrower, subject to and in accordance with the terms of this Agreement and the other Loan Documents (as hereinafter defined);

NOW, THEREFORE, in consideration of the making of the Loan by Lender and the covenants, agreements, representations and warranties set forth in this Agreement, the parties hereto hereby covenant, agree, represent and warrant as follows:

I.               DEFINITIONS; PRINCIPLES OF CONSTRUCTION

Section 1.1              Definitions.

For all purposes of this Agreement, except as otherwise expressly required or unless the context clearly indicates a contrary intent:

“Acceptable Counterparty” means any Counterparty to the Interest Rate Hedging Agreement that has and shall maintain, until the expiration of the applicable Interest Rate Hedging Agreement, a long-term unsecured debt rating of not less than “A+” by S&P and “A1” by Moody’s.

“Accounts” shall mean, collectively, the escrow or reserve accounts established under the Mortgage Loan Documents or hereunder if required by the terms and provisions of Article VII hereof.

“Act” shall have the meaning set forth in Section 4.1.35(d) hereof.

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“Actual Knowledge” shall mean (and shall be limited to), with respect to Borrower or Principal as of any relevant date, the actual (as distinguished from implied, imputed or constructive) knowledge of Caroline Brower, Chaz Mueller and Tom Reif as of such date, without such individuals having made, or having any obligation to make, an independent inquiry or investigation with respect to the matter in question.

“Additional Interest” shall mean all Swap Payments and Swap Breakage.

“Adjusted Prime Rate” shall mean an interest rate per annum equal to the Prime Rate in effect from time to time plus the difference, if a positive number, or minus the difference, if a negative number, (in each case expressed as a percentage) between (a) the Eurodollar Rate on the date LIBOR was last applicable to the Loan and (b) the Prime Rate on the date that LIBOR was last applicable to the Loan.

“Affiliate” shall mean, as to any Person, any other Person that, directly or indirectly, is in control of, is controlled by or is under common control with such Person or is a director or officer of such Person or of an Affiliate of such Person. Such term shall include Guarantor unless otherwise specified or if the context may otherwise require.

“Affiliate Agreements” shall have the meaning set forth in Section 5.2.9(b) hereof.

“Affiliated Manager” shall mean any property manager which is an Affiliate of, or in which Borrower, Mortgage Borrower, Mezzanine A Borrower, Mezzanine A Principal, Principal or Guarantor has, directly or indirectly, any legal, beneficial or economic interest.

“Agent” shall have the meaning set forth in Section 9.7.2(d) hereof.

“Agreement Regarding Management Agreement” shall mean an agreement regarding the management agreement which subordinates the terms, conditions and fees due under the Management Agreement to the terms and conditions of the Loan Documents, executed by and between Lender, Borrower and Manager, and which is reasonably acceptable to Lender, as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time.

“Allocated Loan Amount” shall mean, for any Individual Property, the amount set forth opposite the name of such Individual Property on Exhibit C attached hereto.

“ALTA” shall mean American Land Title Association, or any successor thereto.

“Alteration” shall have the meaning set forth in Section 5.1.20 hereof.

“Applicable Interest Rate” shall mean (A) from and including the date hereof through October 31, 2007, an interest rate per annum equal to 8.121%; and (B) from and including November 1, 2007 and for each successive Interest Period through and including the date on which the Debt is paid in full, an interest rate per annum equal to

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(I) the Eurodollar Rate or (II) if the Loan begins bearing interest at the Adjusted Prime Rate in accordance with the provisions of Section 2.2.3 hereof, the Adjusted Prime Rate.

“Applicable Laws” shall mean all existing and future federal, state and local laws, orders, ordinances, governmental rules and regulations and court orders.

“Appraisal” shall mean an appraisal prepared in accordance with the requirements of FIRREA and USPAP, prepared by an independent third party appraiser holding an MAI designation, who is State licensed or State certified if required under the laws of the State where the applicable Individual Property is located, who meets the requirements of FIRREA and USPAP and who is otherwise reasonably satisfactory to Lender.

“Approval Period” shall have the meaning set forth in Section 5.1.17(a) hereof.

“Assignment and Assumption” shall have the meaning set forth in Section 9.7.2 hereof.

“Assignment of Interest Rate Hedging Agreement” shall mean that certain Mezzanine B Collateral Assignment of Interest Rate Hedging Agreement made by Borrower to Lender as security for the Loan, consented to by the Counterparty, as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time.

“Assumed Note Rate” shall mean an interest rate equal to the sum of (i) 0.50% plus (ii) LIBOR as determined on the immediately preceding Payment Date plus (iii) the Eurodollar Rate Margin.

“Assumption Agreement” shall have the meaning set forth in Section 5.2.11(a)(iii) hereof.

“Award” shall mean any compensation paid by any Governmental Authority in connection with a Condemnation.

“Bank Loan” shall mean those certain extensions of credit made by the Bank Loan Lenders to Bank Loan Borrower pursuant to the Bank Loan Credit Agreement.

“Bank Loan Agent” shall mean Lehman Commercial Paper, Inc., as Administrative Agent for the Bank Loan Lenders, together with its successors and assigns.

“Bank Loan Borrower” shall have the meaning ascribed to the term “Borrower” in the Bank Loan Credit Agreement.

“Bank Loan Credit Agreement” shall mean that certain Credit Agreement, dated as of the date hereof, between Bank Loan Borrower, the Bank Loan Lenders, the Bank Loan Agent and the other parties set forth therein, as the same may hereafter be amended, restated, supplemented or otherwise modified from time to time.

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“Bank Loan Documents” shall mean, collectively, the “Loan Documents” as defined in the Bank Loan Credit Agreement.

“Bank Loan Intercreditor Agreement” shall mean that certain Intercreditor Agreement, dated as of the date hereof, between and among Lender, Mezzanine A Lender, Mortgage Lender and Bank Loan Lender.

“Bank Loan Lenders” shall mean, collectively, the “Lenders” as defined in the Bank Loan Credit Agreement.

“Bankruptcy Code” shall mean Title 11 U.S.C. § 101, et seq., and the regulations adopted and promulgated pursuant thereto (as the same may be amended from time to time), or any successor thereto.

“Basic Carrying Costs” shall mean, with respect to any Individual Property, for any Fiscal Year or other payment period, the sum of the following costs associated with such Individual Property for such Fiscal Year or payment period: (i) Taxes and (ii) Insurance Premiums and (iii) if applicable, Ground Rents.

“Borrower” shall mean, collectively, the entities identified in Exhibit A annexed hereto, together with their respective successors and assigns.

“Borrower Entity” shall mean each of the entities identified in Exhibit A annexed hereto, together with their respective successors and assigns.

“Boston Common Individual Property” shall mean, that certain Individual Property commonly known as Archstone Boston Common, having an address at 660 Washington Street, Boston, Massachusetts.

“Breakage Costs” shall have the meaning set forth in Section 2.2.3(d) hereof.

“Business Day” shall mean any day other than a Saturday, Sunday or any other day on which national banks in New York, New York are not open for business.

“Business Party” shall have the meaning set forth in Section 4.1.35(b) hereof.

“Capital Expenditures” shall mean, for any period, the amount expended during such period with respect to the Properties for items capitalized under GAAP (including expenditures for building improvements or major repairs, leasing commissions and tenant improvements).

“Cash” shall mean coin or currency of the United States of America or immediately available federal funds, including such funds delivered by wire transfer.

“Casualty” shall mean the occurrence of any casualty, damage or injury, by fire or otherwise, to any Individual Property or any part thereof.

“Closing Date” shall mean October 5, 2007, the date of the funding of the Loan.

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“Code” shall mean the Internal Revenue Code of 1986, as amended, and as it may be further amended from time to time, and any successor statutes thereto, and all applicable U.S. Department of Treasury regulations issued pursuant thereto in temporary or final form.

“Co-Lender” shall have the meaning set forth in Section 9.7.2 hereof.

“Co-Lending Agreement” shall mean the co-lending agreement entered into between Lender, individually as a Co-Lender and as Agent and the other Co-Lenders in the event of a Syndication, as the same may be further supplemented modified, amended or restated.

“Collateral” shall mean (i) the Collateral as defined in the Pledge Agreement and (ii) all other collateral for the Loan granted in the Loan Documents.

“Condemnation” shall mean a temporary or permanent taking by any Governmental Authority as the result or in lieu or in anticipation of the exercise of the right of condemnation or eminent domain of all or any part of any Individual Property, or any interest therein or right accruing thereto, including any right of access thereto or any change of grade affecting such Individual Property or any part thereof.

“Condemnation Proceeds” shall mean the net amount of any Award, after deduction of the reasonable costs and expenses (including, but not limited to, reasonable counsel fees), if any, in collecting same.

“Condominium Documents” shall mean, collectively, all documents, as required by the applicable condominium act and otherwise, relating to the submission of the applicable Individual Property to the provisions of said condominium act or to the regulation, operation, administration or sale thereof after such submission, including, but not limited to, a declaration of condominium (including a condominium map), offering circular, articles of incorporation, if applicable, by-laws and rules and regulations of a condominium association, management agreement, and plats.

“Condominium Proxies” shall mean proxies given by Borrower to Lender as reasonably required by Lender with respect to the right to vote on matters under the Condominium Documents.

“control” (and the correlative terms “controlled by” and “controlling”) shall mean, with respect to any entity, the possession, directly or indirectly, of the power to direct or cause the direction of management and policies of the business and affairs of such entity by reason of the ownership of beneficial interests, by contract or otherwise.

“Controlling Interest” means, with respect to any entity, the following:

(i)             if such entity is a limited partnership, any general partnership interest the Transfer of which results in (A) one or more Lehman Entities and/or Tishman Speyer Control Persons not having control of such entity or (B) the

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Guarantors not being owned, directly or indirectly, at least 9.7%, in the aggregate, by one or more Lehman Entities and/or Tishman Speyer Control Persons;

(ii)            if such entity is a limited liability company or a limited liability partnership, any managing member interest (or equivalent) the Transfer of which results in (A) one or more Lehman Entities and/or Tishman Speyer Control Persons not having control of such entity or (B) the Guarantors not being owned, directly or indirectly, at least 9.7%, in the aggregate, by one or more Lehman Entities and/or Tishman Speyer Control Persons; or

(iii)           if such entity is a trust, the removal, appointment or substitution of a trustee of such trust other than (A) in the case of a land trust, or (B) if the trustee of such trust after such removal, appointment or substitution is a trustee selected by one or more Lehman Entities and/or Tishman Speyer Control Persons and such trustee is subject to removal at the sole discretion of one or more Lehman Entities and/or Tishman Speyer Control Persons.

“Counterparty” shall mean any Person which is the issuer of the Interest Rate Hedging Agreement.

“Creditors Rights Laws” shall mean, with respect to any Person, any existing or future law of any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency, reorganization, conservatorship, arrangement, adjustment, winding-up, liquidation, dissolution, composition or other relief with respect to its debts or debtors.

“Debt” shall mean the outstanding principal amount set forth in, and evidenced by, this Agreement and the Note, together with all interest accrued and unpaid thereon and all other sums due to Lender in respect of the Loan under the Note, this Agreement, the Pledge Agreement or any other Loan Document.

“Debt Service” shall mean, with respect to any period, interest payments and/or principal and interest payments due under the Note for such period.

“Debt Service Coverage Ratio” shall mean the ratio of (A) the aggregate annual net operating income from the operations of the Properties at the time of calculation to (B) the aggregate annual Debt Service, Mortgage Debt Service and Mezzanine A Debt Service (based upon the outstanding principal balance of the Loan, the Mortgage Loan and the Mezzanine A Loan at the time of calculation). The annual net operating income of each property will be as determined by Lender in its reasonable discretion considering factors such as income in place at the time of calculation and income during the preceding twelve months, and actual, historical and anticipated operating expenses.

“Debt Service Shortfall” means as of any Payment Date, the amount, if any, by which the Debt Service due on such Payment Date in respect of any applicable interest accrual period exceeds Net Cash Flow for the same period.

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“Default” shall mean the occurrence of any event hereunder or under any other Loan Document which, but for the giving of notice or passage of time, or both, would constitute an Event of Default.

“Default Rate” shall mean a rate per annum equal to the lesser of (a) the Maximum Legal Rate, and (b) four percent (4%) above the Applicable Interest Rate.

“Determination Date” shall mean the first Payment Date in each January, April, July, and October, during the term of the Loan.

“Disclosure Document” shall have the meaning set forth in Section 9.2 hereof.

“Disclosed Litigation” shall have the meaning set forth in Section 4.1.4 hereof.

“Distributions” shall have the meaning set forth in Section 5.2.13 hereof.

“Eligible Account” shall mean an identifiable account separate from all other funds held by the holding institution that is either (a) an account or accounts maintained with a federal or State chartered depository institution or trust company which complies with the definition of Eligible Institution or (b) a segregated trust account or accounts maintained with a federal or State chartered depository institution or trust company acting in its fiduciary capacity which, in the case of a State chartered depository institution or trust company, is subject to regulations substantially similar to 12 C.F.R.§9.10(b), having in either case a combined capital and surplus of at least $50,000,000 and subject to supervision or examination by federal and State authority. An Eligible Account will not be evidenced by a certificate of deposit, passbook or other instrument.

“Eligible Institution” shall mean a depository institution or trust company, insured by the Federal Deposit Insurance Corporation, (a) the short term unsecured debt obligations or commercial paper of which are rated at least A-1+ by S&P, P-1 by Moody’s and F-1+ by Fitch in the case of accounts in which funds are held for thirty (30) days or less, or (b) the long term unsecured debt obligations of which are rated at least “AA-” by Fitch and S&P and “Aa3” by Moody’s in the case of accounts in which funds are held for more than thirty (30) days.

“Embargoed Person” shall have the meaning set forth in Section 4.1.44 hereof.

“Environmental Indemnity” shall mean that certain Mezzanine B Environmental Indemnity Agreement executed by Borrower for the benefit of Lender, as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time.

“Environmental Law” shall mean any federal, State and local laws, statutes, ordinances, rules, regulations, standards, policies and other government directives or requirements, as well as common law, that, at any time, apply to Borrower or any Individual Property and relate to Hazardous Materials, including, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act and the Resource Conservation and Recovery Act.

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“Environmental Liens” shall have the meaning set forth in Section 5.1.19(a) hereof.

“Environmental Report” shall have the meaning set forth in Section 4.1.39 hereof.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended, and as the same may hereafter be further amended from time to time.

“Eurodollar Rate” shall mean, with respect to any Interest Period, an interest rate per annum equal to LIBOR plus the Eurodollar Rate Margin.

“Eurodollar Rate Margin” shall mean an interest rate equal to 3% per annum.

“Event of Default” shall have the meaning set forth in Section 8.1(a) hereof.

“Exchange Act” shall have the meaning set forth in Section 9.2 hereof.

“Exchange Act Filing” shall have the meaning set forth in Section 9.2 hereof.

“Excluded Taxes” shall mean (i) any U.S. Taxes imposed solely by reason of the failure by such Person (or, if such Person is not the beneficial owner of the Loan, such beneficial owner) to comply with applicable certification, information, documentation or other reporting requirements concerning the nationality, residence, identity or connections with the United States of America of such Person (or beneficial owner, as the case may be) if such compliance is required by statute or regulation of the United States of America as a precondition to relief or exemption from such U.S. Taxes; (ii) with respect to any Person who is a fiduciary or partnership or other than the sole beneficial owner of such payment, any U.S. Tax imposed with respect to payments made under the Note to a fiduciary or partnership to the extent that the beneficial owner or member of the partnership would not have been entitled to the additional amounts if such beneficial owner or member of the partnership had been the holder of the Note; or (iii) any taxes on profits, branch profits, franchise taxes and taxes imposed on or measured by all or part of gross or net income of the recipient of such payment by the jurisdiction under the laws of which the recipient is organized, in which it is a citizen, resident or domiciliary, or, in each case, any political subdivision of any thereof.

“Exculpated Party” shall have the meaning set forth in Section 9.4(a) hereof.

“Executive Order” shall have the meaning ascribed to such term in the definition of Prohibited Person.

“Extended Maturity Date” shall have the meaning set forth in Section 2.2.1(b) hereof.

“Extension Fee” shall mean one-eighth of one percent (0.125%) of the outstanding principal amount of the Loan.

“Extension Option” shall have the meaning set forth in Section 2.2.1(b) hereof.

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“Extension Period” shall have the meaning set forth in Section 2.2.1(b) hereof.

“FIRREA” means the Financial Institutions Reform, Recovery and Enforcement Act of 1989, as amended, and as the same may hereafter be further amended from time to time.

“Fiscal Year” shall mean each twelve (12) month period commencing on January 1 and ending on December 31 during the term of the Loan.

“Fitch” shall mean Fitch, Inc.

“Foreign Taxes” shall mean any present or future income, stamp or other taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now or hereafter imposed, levied, collected, withheld or assessed by any foreign Governmental Authority.

“GAAP” shall mean generally accepted accounting principles in the United States of America.

“Governmental Authority” shall mean any court, board, agency, commission, office, central bank or other authority of any nature whatsoever for any governmental unit (federal, State, county, district, municipal, city, country or otherwise) or quasi-governmental unit whether now or hereafter in existence.

“Gross Income from Operations” shall mean the gross cash receipts derived from the ownership and operation of the Properties, from whatever source, including, but not limited to, the Rents, utility charges, escalations, forfeited security deposits (but only to the extent applied to rent payable under the applicable Lease, as and when payable), interest on credit accounts, service fees or charges, license fees, parking fees, rent concessions or credits, other required pass-throughs and interest on the Reserve Funds (if and to the extent such interest is actually disbursed to Borrower, Mezzanine A Borrower or Mortgage Borrower), but excluding sales, use and occupancy or other taxes on receipts required to be accounted for by Mortgage Borrower to any Governmental Authority, refunds and uncollectible accounts, sales of furniture, fixtures and equipment, Insurance Proceeds (other than business interruption or other loss of income insurance), Awards, unforfeited security deposits, payments received under the Interest Rate Hedging Agreement (other than in connection with the determination of any Debt Service Shortfall), utility and other similar deposits and any disbursements to Borrower, Mezzanine A Borrower or Mortgage Borrower from the Mortgage Loan Reserve Funds and any extraordinary non-recurring items of income. Gross income shall not be diminished as a result of the Security Instruments or the creation of any intervening estate or interest in an Individual Property or any part thereof.

“Ground Lease” shall mean, individually and collectively, as the context may require, each ground lease described on Exhibit D attached hereto and made a part hereof.

“Ground Rent” shall mean all rent and any and all other charges which may be due by Mortgage Borrower under the Ground Lease.

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“Guarantor” shall mean Archstone-Smith Operating Trust, a Maryland real estate investment trust.

“Guaranty” shall mean that certain Mezzanine B Guaranty of Recourse Obligations of Borrower, dated as of the date hereof, from Guarantor to Lender, as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time.

“Hazardous Materials” shall mean petroleum and petroleum products and compounds containing them, including gasoline, diesel fuel and oil; explosives; flammable materials; radioactive materials; polychlorinated biphenyls (“PCBs”) and compounds containing them; lead and lead-based paint; asbestos or asbestos-containing materials in any form that is or could become friable; underground or above-ground storage tanks, whether empty or containing any substance; toxic mold; any substance the presence of which on any Individual Property is prohibited by any federal, State or local authority; any substance that requires special handling; and any other material or substance now or in the future defined as a “hazardous substance,” “hazardous material,” “hazardous waste,” “toxic substance,” “toxic pollutant,” “contaminant,” “pollutant” or other words of similar import within the meaning of any Environmental Law.

“Improvements” shall mean the buildings, structures, fixtures, additions, enlargements, extensions, modifications, repairs, replacements and improvements now or hereafter erected or located on or which constitute a part of the applicable Individual Property.

“Indemnified Liabilities” shall have the meaning set forth in Section 10.13(b) hereof.

“Indemnified Parties” shall mean Lender, the Servicer, any Person in whose name the security interest created by the Pledge Agreement is or will have been recorded, Persons who may hold or acquire or will have held a full or partial interest in the Loan, the holders of any Securities, as well as custodians, trustees and other fiduciaries who hold or have held a full or partial interest in the Loan for the benefit of third parties, as well as the respective directors, officers, shareholders, partners, members, employees, agents, servants, representatives, contractors, subcontractors, Affiliates, subsidiaries, participants, successors and assigns of any and all of the foregoing (including but not limited to (a) any other Person who holds or acquires or will have held a participation or other full or partial interest in the Loan or the Properties, whether during the term of the Loan or as a part of or following a foreclosure of the Loan, and (b) successors by merger, consolidation or acquisition of all or a substantial portion of Lender’s assets and business).

“Independent Director” shall have the meaning set forth in Section 4.1.35(b) hereof.

“Individual Property” shall mean each parcel of real property (including, without limitation, any interest created pursuant to the Ground Lease), the Improvements thereon

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and all Personal Property owned by the applicable Mortgage Borrower Entity and encumbered by a Security Instrument, together with all rights pertaining to such Property and Improvements, as more particularly described in the granting clause of the Security Instrument and referred to therein as the “Mortgaged Property”.

“Information” shall have the meaning set forth in Section 9.7.3(b) hereof.

“Insolvency Opinion” shall mean that certain bankruptcy non-consolidation opinion letter delivered by counsel for Borrower.

“Institutional Investor” shall mean, in connection with any proposed Transfer, any one of the following entities:  (a) a pension fund, pension trust or pension account that has total assets of at least $200,000,000, exclusive of its interest in Borrower, that are managed by an entity that controls or manages at least $400,000,000 of real estate equity assets, exclusive of equity interests in Borrower; (b) a pension fund advisor that controls or manages at least $400,000,000 of real estate equity assets, exclusive of equity interests in Borrower, immediately prior to such Transfer; (c) an insurance company that is subject to supervision by the insurance commission, or a similar official or agency, of a state or territory of the United States (including the District of Columbia), which has a net worth, as of a date no more than six (6) months prior to the date of such Transfer, of at least $400,000,000 and controls real estate equity assets of at least $400,000,000 immediately prior to such Transfer; (d) a corporation organized under the banking laws of the United States or any state or territory of the United States (including the District of Columbia) that has a combined capital and surplus of at least $200,000,000; (e) any entity (x) with a long-term unsecured debt rating from the Rating Agencies of at least Investment Grade or (y) (1) that owns or operates, together with its affiliates, ten (10) or more first class luxury residential apartment buildings totaling at least 2500 residential units, (2) that has a net worth as of a date no more than six (6) months prior to the date of such Transfer of at least $200,000,000 and (3) that controls real estate equity assets of at least $400,000,000 immediately prior to such Transfer; (f) a limited partnership, limited liability company or similar entity that shall have been organized for the purpose of facilitating investment in one or more U.S. real estate opportunities, provided such entity shall be sponsored, organized and/or controlled by one or more experienced and reputable syndicators, investment advisors and/or financial institutions and shall have received contributions or binding commitments for contributions of not less than $20,000,000 of investment capital; (g) any entity controlled by one or more entities each of which qualifies under at least one of clauses (a) through (f) above; (h) any individual, a citizen of and domiciled in the United States, having a net worth of at least $100,000,000 and satisfying Lender’s then-current criteria with respect to business character and experience, as reasonably determined by Lender, and free from any pending or existing bankruptcy, reorganization or insolvency proceedings in which such party is the debtor or any criminal charges or proceedings and shall not be, at the time of such Transfer or in the past, a litigant, plaintiff or defendant in any suit brought against or by Lender; or (i) a trust for the benefit of one or more individuals satisfying the criteria of clause (h) above.

“Insurance Premiums” shall mean the premiums due under the Policies.

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“Insurance Proceeds” shall mean the net amount of all insurance proceeds after deduction of the reasonable costs and expenses (including, but not limited to, reasonable counsel fees), if any, in collecting same.

“Intercreditor Agreements” shall have the meaning set forth in Section 9.14 hereof.

“Interest Period” shall mean, in connection with the calculation of interest accrued with respect to any specified Payment Date, the period from and including the first (1 ^st ) day of a calendar month to and including the last day of such calendar month; provided, however, that with respect to the Payment Date occurring in November, 2007, the Interest Period shall be the period commencing on the Closing Date to and including October 31, 2007. Each Interest Period, except for the Interest Period ending October 31, 2007, shall be a full month and shall not be shortened by reason of any payment of the Loan prior to the expiration of such Interest Period.

“Interest Rate Hedging Agreement” shall mean any interest rate cap agreement or interest rate swap (in each case together with any confirmation and schedules relating thereto) between an Acceptable Counterparty, and Borrower (if an interest rate cap) or an Affiliate of Borrower (if an interest rate swap) in accordance with Section 2.4. The Interest Rate Hedging Agreement shall be written on the then current standard ISDA documentation, shall provide for interest periods and calculations consistent with the payment terms of this Agreement and otherwise be reasonably satisfactory to Lender. After delivery of a Replacement Interest Rate Hedging Agreement to Lender, the term “Interest Rate Hedging Agreement” shall be deemed to mean such Replacement Interest Rate Hedging Agreement.

“Interest Shortfall” shall have the meaning set forth in Section 2.3.1(b) hereof.

“Investment Grade” shall mean a rating of “BBB-” or its equivalent by the Rating Agencies.

“Investor” shall mean any purchaser, transferee, assignee, participant, Co-Lender or investor in all or any portion of the Loan or any Securities.

“Lease Term Sheet” shall have the meaning set forth in Section 5.1.17(a) hereof.

“Lease Termination Payments” shall mean all payments made to Mortgage Borrower in connection with the termination, cancellation, surrender, sale or other disposition of any Lease.

“Leases” shall have the meaning set forth in the Security Instrument.

“Legal Requirements” shall mean all federal, State, county, municipal and other governmental statutes, laws, rules, orders, regulations, ordinances, judgments, decrees and injunctions of Governmental Authorities affecting the Collateral, the Mezzanine A Collateral, Borrower, Mortgage Borrower, Mezzanine A Borrower, any Mortgage Principal’s general partner interest in the related Mortgage Borrower Entity, any

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Mezzanine A Principal’s general partner interest in the related Mezzanine A Borrower Entity or any Individual Property or any part thereof, or the zoning, construction, use, alteration, occupancy or operation thereof, or any part thereof, whether now or hereafter enacted and in force, and all permits, licenses and authorizations and regulations relating thereto, and all covenants, agreements, restrictions and encumbrances contained in any instruments, either of record or as to which Borrower has Actual Knowledge, at any time in force affecting such Individual Property or any part thereof, including, without limitation, any such covenants, agreements, restrictions and encumbrances which may (a) require repairs, modifications or alterations in or to such Individual Property or any part thereof, or (b) in any material way limit the use and enjoyment thereof.

“Lehman Entities” shall mean, collectively, Lehman Brothers Holdings Inc., a Delaware corporation, and any Person that, directly or indirectly, through one or more intermediaries, controls or is controlled by, or is under common control with Lehman Brothers Holdings Inc., a Delaware corporation.

“Lender” shall mean Lehman Brothers Holdings Inc., a Delaware corporation, Bank of America, N.A., a national banking association and Barclays Capital Real Estate Finance Inc., a Delaware corporation, together with their respective successors and assigns.

“Lender’s Approval Extension Period” shall have the meaning set forth in Section 5.1.17(a) hereof.

“Letter of Credit” shall mean a clean, irrevocable, unconditional, transferable letter of credit payable on sight draft only, with an initial expiration date of not less than one (1) year and with automatic renewals for one (1) year periods (unless the obligation being secured by, or otherwise requiring the delivery of, such letter of credit is required to be performed at least thirty (30) days prior to the initial expiry date of such letter of credit), for which Borrower shall have no reimbursement obligation and which reimbursement obligation is not secured by (x) the Collateral or any other property pledged to secure the Note (y) the Mezzanine A Collateral or any other property pledged to secure the Mezzanine A Note or (z) the Property or any other property that secures the Mortgage Loan, in favor of Lender and entitling Lender to draw thereon in New York, New York or in such other city as Lender may reasonably determine, issued by Bank of America, N.A., JPMorgan Chase Bank or another domestic bank or the U.S. agency or branch of a foreign bank, provided such other bank (A) has a long-term unsecured debt rating at the time such letter of credit is delivered and throughout the term of such letter of credit, of not less than “AA-” or “Aa3”, as applicable, as assigned by the Rating Agencies or (B) if a Securitization has occurred, has a long-term debt rating that the applicable Rating Agencies have confirmed in writing will not, in and of itself, result in a downgrade, withdrawal or qualification of the initial, or, if higher, the then current ratings assigned in connection with such Securitization.

“LIBOR” shall mean, for the first Interest Period 5.121% per annum. For each Interest Period thereafter LIBOR shall mean the quoted offered rate for one-month United States dollar deposits with leading banks in the London interbank market that

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appears as of 11:00 a.m. (London time) on the related LIBOR Determination Date on the display page designated as Reuters Screen LIBOR01 Page or such other page as may replace such page on that service or such other service as may be nominated by the British Bankers-Association as the information vendor for the purposes of displaying British Bankers-Association Interest Settlement Rates for U.S. dollar deposits (the “Reuters Screen LIBOR01 Page”).

If, as of such time on any LIBOR Determination Date, no quotation is given on Reuters Screen LIBOR01 Page, then Lender shall establish LIBOR on such LIBOR Determination Date by requesting four Reference Banks meeting the criteria set forth herein to provide the quotation offered by its principal London office for making one-month United States dollar deposits with leading banks in the London interbank market as of 11:00 a.m., London time, on such LIBOR Determination Date.

(i)                                      If two or more Reference Banks provide such offered quotations, then LIBOR for the next Interest Period shall be the arithmetic mean of such offered quotations (rounded if necessary to the nearest whole multiple of 1/1,000%).

(ii)                                   If only one or none of the Reference Banks provides such offered quotations, then LIBOR for the next Interest Period shall be the Reserve Rate.

(iii)                                If on any LIBOR Determination Date, Lender is required but is unable to determine the LIBOR in the manner provided in paragraphs (i) and (ii) above, LIBOR for the next Interest Period shall be LIBOR as determined on the preceding LIBOR Determination Date.

The establishment of LIBOR on each LIBOR Determination Date by the Lender shall be final and binding, absent manifest error.

“LIBOR Business Day” shall mean a day upon which (i) United States dollar deposits may be dealt in on the London interbank markets and (ii) commercial banks and foreign exchange markets are open in London, England and in New York, New York, USA.

“LIBOR Determination Date” shall mean, with respect to any Interest Period, the date that is the LIBOR Business Day immediately preceding the start of such Interest Period.

“Licenses” shall have the meaning set forth in Section 4.1.21 hereof.

“Lien” shall mean any mortgage, deed of trust, lien, pledge, hypothecation, assignment, security interest, or any other encumbrance, charge or transfer of, on or affecting Collateral, the Mezzanine A Collateral, Borrower, Mortgage Borrower, Mezzanine A Borrower, any Mortgage Principal’s general partner interest in the related Mortgage Borrower Entity, any Mezzanine A Principal’s general partner interest in the related Mezzanine A Borrower Entity or any Individual Property, any portion thereof or any interest therein, including, without limitation, any conditional sale or other title

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retention agreement, any financing lease having substantially the same economic effect as any of the foregoing, the filing of any financing statement, and mechanic’s, materialmen’s and other similar liens and encumbrances.

“Liquidation Event” shall have the meaning set forth in Section 2.3.2(a) hereof.

“LLC Agreement” shall have the meaning set forth in Section 4.1.35(d) hereof.

“Loan” shall mean the loan in the original principal amount of SIXTY-THREE MILLION FIVE HUNDRED ONE THOUSAND SEVEN HUNDRED TWENTY-NINE AND 16/100 DOLLARS ($63,501,729.16) made by Lender to Borrower pursuant to this Agreement and the other Loan Documents, as the same may hereafter be amended or split pursuant to the terms hereof.

“Loan Documents” shall mean, collectively, this Agreement, the Note, the Pledge Agreement the Environmental Indemnity, the Guaranty and all other documents executed and/or delivered in connection with the Loan.

“Loan Party” shall mean, individually and collectively, as the context requires, each Mortgage Borrower Entity, each Mortgage Principal, each Mezzanine A Borrower Entity, each Mezzanine A Principal, each Borrower Entity and each Principal.

“Loan to Value Ratio” shall mean, as of the date of its calculation, the ratio of (i) the sum of the respective outstanding principal amounts of the Loan, the Mezzanine A Loan and the Mortgage Loan as of the date of such calculation to (ii) the aggregate appraised value of the Properties (according to an Appraisal prepared not earlier than one (1) year prior to such date of calculation).

“Losses” shall mean any and all claims, suits, liabilities (including, without limitation, strict liabilities), actions, proceedings, obligations, debts, damages, losses, costs, expenses, fines, penalties, charges, fees, expenses, judgments, awards, amounts paid in settlement of whatever kind or nature (including, but not limited to, reasonable out-of-pocket attorneys’ fees and other costs of defense).

“LP Act” shall have the meaning set forth in Section 4.1.35(e) hereof.

“LP Agreement” shall have the meaning set forth in Section 4.1.35(e) hereof.

“Major Lease” shall mean (i) any Lease relating to commercial space which, individually or together with all other Leases to the same tenant and to all Affiliates of such tenant covers more than 5,000 rentable square feet at any Individual Property, in the aggregate, (ii) any Lease relating to residential space which, individually or together with all other Leases to the same tenant and to all Affiliates of such tenant covers more than ten percent (10%) of the total number of residential units at any Individual Property, (iii) any Lease for the operation of any parking garage or facility, or (iv) any Lease which is with an Affiliate of Borrower.

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“Management Agreement” shall mean, with respect to any Individual Property, a management agreement between the applicable Mortgage Borrower Entity and a Qualified Manager, pursuant to which such Qualified Manager is to provide management, leasing and other services with respect to such Individual Property, which management agreement shall be reasonably acceptable to Lender in form and substance; provided, however, if such management agreement shall be entered into after a Securitization, then Lender, at its option, may condition its approval upon receiving confirmation from the applicable Rating Agencies that such management agreement will not result in a downgrade, withdrawal or qualification of the then current rating of the Securities or any class thereof. Concurrently with the execution and delivery of any Management Agreement with a Qualified Manager, Lender shall be provided, at Borrower’s expense, with an Agreement Regarding Management Agreement.

“Manager” shall mean a Qualified Manager who is managing an Individual Property in accordance with the terms and conditions of this Agreement.

“Material Adverse Effect” shall mean a material adverse effect on (i) any Individual Property, (ii) the Collateral, (iii) the Mezzanine A Collateral, (iv) any Mortgage Principal’s general partner interest in the related Mortgage Borrower Entity, (v) any Mezzanine A Principal’s general partner interest in the related Mezzanine A Borrower Entity, (vi) the business, profits, prospects, management, operations or condition (financial or otherwise) of Borrower, Mortgage Borrower, Mezzanine A Borrower, Guarantor, any Principal, the Collateral, the Mezzanine A Collateral, any Mortgage Principal’s general partner interest in the related Mortgage Borrower Entity, any Mezzanine A Principal’s general partner interest in the related Mezzanine A Borrower Entity or any Individual Property, (vii) the enforceability, validity, perfection or priority of the lien of this Agreement, the Note, the Pledge Agreement or the other Loan Documents, or (viii) the ability of Borrower to perform its obligations under this Agreement, the Note, the Pledge Agreement or the other Loan Documents.

“Material Agreement” means all agreements, other than the Management Agreement and the Leases, entered into by any Loan Party affecting or relating to the Property, the Collateral, the Mezzanine A Collateral, any Mortgage Principal’s general partner interest in the related Mortgage Borrower Entity, any Mezzanine A Principal’s general partner interest in the related Mezzanine A Borrower Entity or any other direct or indirect ownership interest of a Loan Party in the Mortgage Borrower, Mezzanine A Borrower or Borrower requiring the payment of more than $1,000,000, individually, in payments or liability in any annual period and which is not cancelable without penalty or premium on no more than thirty (30) days notice.

“Material Alteration” shall have the meaning set forth in Section 5.1.20 hereof.

“Material Alteration Security” shall have the meaning set forth in Section 5.1.20 hereof.

“Maturity Date” shall mean November 1, 2010, or such other date on which the final payment of the principal of the Note becomes due and payable as therein or herein

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provided, whether at such stated maturity date, by declaration of acceleration, or otherwise.

“Maximum Legal Rate” shall mean the maximum non-usurious interest rate, if any, that at any time or from time to time may be contracted for, taken, reserved, charged or received on the indebtedness evidenced by the Note and as provided for herein or the other Loan Documents, under the laws of such State or States whose laws are held by any court of competent jurisdiction to govern the interest rate provisions of the Loan.

“Member” shall have the meaning set forth in Section 4.1.35(d) hereof.

“Mezzanine A Borrower” shall have the meaning ascribed to the term “Borrower” in the Mezzanine A Loan Agreement.

“Mezzanine A Borrower Entity” shall have the meaning ascribed to the term “Borrower Entity” in the Mezzanine A Loan Agreement.

“Mezzanine A Collateral” shall have the meaning ascribed to the term “Collateral” set forth in the Mezzanine A Loan Agreement.

“Mezzanine A Debt Service” shall mean, with respect to any period, interest payments due and payable under the Mezzanine A Note for such period.

“Mezzanine A Lender” shall mean Lehman Brothers Holdings Inc., a Delaware corporation, Bank of America, N.A., a national banking association and Barclays Capital Real Estate Finance Inc., a Delaware corporation, together with their respective successors and assigns.

“Mezzanine A Loan” shall mean that certain loan in the original principal amount of $71,939,553.23 made by Mezzanine A Lender to Mezzanine A Borrower on the date hereof pursuant to the Mezzanine A Loan Agreement, as the same may be amended or split pursuant to the terms of the Mezzanine A Loan Documents.

“Mezzanine A Loan Agreement” shall mean that certain Mezzanine A Loan Agreement, dated as of the date hereof, between Mezzanine A Borrower and Mezzanine A Lender, as the same may be amended, restated, supplemented or otherwise modified from time to time.

“Mezzanine A Loan Documents” shall mean, collectively, all documents or instruments evidencing, securing or guaranteeing the Mezzanine A Loan, including, without limitation, the Mezzanine A Loan Agreement and the Mezzanine A Note.

“Mezzanine A Loan Event of Default” shall have the meaning ascribed to the term “Event of Default” in the Mezzanine A Loan Agreement.

“Mezzanine A Loan Extension” shall have the meaning ascribed to the term “Extension Option” in the Mezzanine A Loan Agreement.

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“Mezzanine A Note” shall mean that certain Mezzanine A Promissory Note, dated as of the date hereof, given by Mezzanine A Borrower to Mezzanine A Lender in the maximum principal amount of $71,939,553.23, as the same may be amended, restated, supplemented or otherwise modified from time to time.

“Mezzanine A Principal” shall have the meaning ascribed to the term “Principal” in the Mezzanine A Loan Agreement.

“Mezzanine Loan Intercreditor Agreement” shall mean that certain Intercreditor Agreement, dated as of the date hereof, between and among Lender, Mezzanine A Lender and Mortgage Lender.

“Monthly Debt Service Payment Amount” shall mean the amount of principal and interest due and payable on each Payment Date pursuant to the Note and Section 2.2 hereof.

“Mortgage Borrower” shall have the meaning ascribed to the term “Borrower” in the Security Instrument.

“Mortgage Borrower Entity” shall have the meaning ascribed to the term “Borrower” in the Security Instrument.

“Mortgage Borrower Formation Agreement” shall mean, with respect to each Mortgage Borrower Entity, the Limited Partnership Agreement, Limited Liability Company Agreement or other similar entity formation agreement of such Mortgage Borrower Entity.

“Mortgage Cross Collateralization Agreement” shall mean that certain Cross-Collateralization Agreement and Amendment to Security Instrument, dated as of the date hereof, between Mortgage Borrower and Mortgage Lender, as amended, restated, replaced, supplemented or otherwise modified from time to time.

“Mortgage Debt Service Escrow Agreement” shall mean that certain Debt Service Escrow Agreement, dated as of the date hereof, between Mortgage Borrower and Mortgage Lender, as amended, restated, replaced, supplemented or otherwise modified from time to time.

“Mortgage Interest Rate Hedge Reserve Agreement” shall mean that certain Agreement to Hedge Interest Rate, Interest Rate Hedge Assignment and Security Agreement, dated as of the date hereof, between Mortgage Borrower and Mortgage Lender, as amended, restated, replaced, supplemented or otherwise modified from time to time.

“Mortgage Lender” shall mean Lehman Brothers Holdings Inc., a Delaware corporation, Bank of America, N.A., a national banking association and Barclays Capital Real Estate Inc., a Delaware corporation, together with their respective successors and assigns.

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“Mortgage Loan” shall mean that certain loan made by Mortgage Lender to Mortgage Borrower in the original principal amount of $846,907,500.00.

“Mortgage Loan Debt Service” shall mean the debt service payments due under the Mortgage Note.

“Mortgage Loan Documents” shall mean, collectively, the Mortgage Note, the Security Instrument, and any and all other documents defined as “Loan Documents” in the Security Instrument, as amended, restated, replaced, supplemented or otherwise modified from time to time.

“Mortgage Loan Event of Default” shall have the meaning ascribed to the term “Event of Default” in the Security Instrument.

“Mortgage Loan Reserve Funds” shall mean the escrow or reserve funds established under the Mortgage Loan Documents.

“Mortgage Note” shall have the meaning ascribed to the term “Note” in the Security Instrument.

“Mortgage Principal” shall mean, with respect to each Mortgage Borrower Entity that is a limited partnership, the general partner of such Mortgage Borrower Entity.

“Mortgage Repair Agreement” shall mean that certain Repair Agreement, dated as of the date hereof, between Mortgage Borrower and Mortgage Lender, as amended, restated, replaced, supplemented or otherwise modified from time to time.

“Mortgage Replacement Reserve Agreement” shall mean that certain Replacement Reserve Agreement, dated as of the date hereof, between Mortgage Borrower and Mortgage Lender, as amended, restated, replaced, supplemented or otherwise modified from time to time.

“Mortgage Title Insurance Policy” shall mean, with respect to each Individual Property, an ALTA mortgagee title insurance policy acceptable to Mortgage Lender (or, if an Individual Property is located in a State which does not permit the issuance of such ALTA policy, such form as shall be permitted in such State and acceptable to Mortgage Lender) issued with respect to such Individual Property and insuring the lien of the Security Instrument encumbering such Individual Property.

“Moody’s” shall mean Moody’s Investors Service, Inc.

“Multifamily Guarantor” shall mean Tishman Speyer Archstone-Smith Multifamily Guarantor, L.P., a Delaware limited partnership.

“Multifamily Parallel Guarantor” shall mean Tishman Speyer Archstone-Smith Multifamily Parallel Guarantor, L.L.C., a Delaware limited liability company.

“Municipal Violations” shall have the meaning set forth in Section 4.1.9 hereof.

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“Net Cash Flow” shall mean, for any period, the amount obtained by subtracting Operating Expenses and Capital Expenditures for such period from Gross Income from Operations for such period.

“Net Cash Flow After Debt Service” shall mean, for any period, the amount obtained by subtracting Debt Service, Mortgage Loan Debt Service and Mezzanine A Debt Service for such period from Net Cash Flow for such period.

“Net Liquidation Proceeds After Debt Service” shall mean, with respect to any Liquidation Event, all amounts paid to or received by or on behalf of any Mortgage Borrower Entity (or any Mezzanine A Borrower Entity) in connection with such Liquidation Event, including, without limitation, proceeds of any sale, refinancing or other disposition or liquidation, less (i) in the event of a Liquidation Event consisting of a Casualty or Condemnation, Borrower’s, Mortgage Borrower’s, Mezzanine A Borrower’s, Lender’s, Mezzanine A Lender’s, and/or Mortgage Lender’s reasonable out-of-pocket costs incurred in connection with the recovery thereof, (ii) in the event of a Liquidation Event consisting of a Casualty or Condemnation, the costs incurred by Mortgage Borrower in connection with a restoration of all or any portion of the applicable Individual Property made in accordance with the Mortgage Loan Documents, (iii) in the event of a Liquidation Event consisting of a Casualty or Condemnation or a Transfer, amounts required or permitted to be deducted therefrom and amounts paid pursuant to the Mortgage Loan Documents to Mortgage Lender, (iv) in the event of a Liquidation Event consisting of a Casualty or Condemnation, the excess Insurance Proceeds or Condemnation Proceeds not used for the Restoration of the applicable Individual Property which are paid to Mortgage Borrower, (v) in the case of a foreclosure sale, disposition or transfer of an Individual Property in connection with realization thereon following a Mortgage Loan Event of Default, reasonable and customary out-of-pocket costs and expenses of sale or other disposition (including attorneys’ fees and brokerage commissions), (vi) in the case of a foreclosure sale, disposition or transfer of the Mezzanine A Collateral in connection with realization thereon following a Mezzanine A Loan Event of Default, reasonable and customary out-of-pocket costs and expenses of sale or other disposition (including attorneys’ fees and brokerage commissions), (vii) intentionally omitted, (viii) in the case of a foreclosure sale relating to the Mortgage Loan, such costs and expenses incurred by Mortgage Lender under the Mortgage Loan Documents as Mortgage Lender shall be entitled to receive reimbursement for under the terms of the Mortgage Loan Documents, (ix) in the case of a foreclosure sale relating to the Mezzanine A Loan, such costs and expenses incurred by Mezzanine A Lender under the Mezzanine A Loan Documents as Mezzanine A Lender shall be entitled to receive reimbursement for under the terms of the Mezzanine A Loan Documents, (x) intentionally omitted, (xi) in the case of a refinancing of the Mortgage Loan, such costs and expenses (including attorneys’ fees) of such refinancing, (xii) in the case of a refinancing of the Mezzanine A Loan, such costs and expenses (including attorneys’ fees) of such refinancing, (xiii) intentionally omitted, (xiv) the amount of any prepayments required pursuant to the Mortgage Loan Documents, the Mezzanine A Loan Documents and/or the Loan Documents in connection with such Liquidation Event and (xv) any sums due to Mezzanine A Lender pursuant to Section 2.3.2 of the Mezzanine A Loan Agreement.

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“Net Operating Income” shall mean, for any period, the amount obtained by subtracting Operating Expenses for such period from Gross Income from Operations for such period.

“Net Proceeds” shall mean the Insurance Proceeds or the Condemnation Proceeds, as applicable.

“Note” shall mean that certain Mezzanine B Promissory Note of even date herewith in the original principal amount of SIXTY-THREE MILLION FIVE HUNDRED ONE THOUSAND SEVEN HUNDRED TWENTY-NINE AND 16/100 DOLLARS ($63,501,729.16), made by Borrower in favor of Lender, as the same may be amended, restated, replaced, extended, renewed, supplemented, severed, split, or otherwise modified from time to time in accordance with the applicable provisions of this Agreement.

“Obligations” shall mean Borrower’s obligations to pay the Debt and perform its obligations under the Note, this Agreement and the other Loan Documents.

“Officer’s Certificate” shall mean a certificate delivered to Lender by Borrower which is signed by a Responsible Officer of Borrower, in his or her capacity as an officer of Borrower and not in his or her individual capacity.

“Operating Expenses” shall mean the total of all costs and expenses, computed in accordance with GAAP, of whatever kind relating to the operation, maintenance, use and management of the Properties that are incurred on a regular monthly or other periodic basis, including without limitation, utilities, ordinary repairs and maintenance, insurance premiums, license fees, Taxes and Other Charges, advertising expenses, management fees, accounting, legal and other professional fees (if properly allocated to the Properties and the operation and management thereof), payroll and related taxes, computer processing charges, operational equipment or other lease payments, and other similar costs, but excluding depreciation, Debt Service, Capital Expenditures and contributions to the Reserve Funds, if applicable, or the Mortgage Loan Reserve Funds.

“Organizational Documents” shall mean (i) with respect to a corporation, such Person’s certificate of incorporation and by laws, and any shareholder agreement, voting trust or similar arrangement applicable to any of such Person’s authorized shares of capital stock or other organizational document affecting the rights of holders of such stock, (ii) with respect to a partnership, such Person’s certificate of limited partnership, partnership agreement, voting trusts or similar arrangements applicable to any of its partnership interests or other organizational document affecting the rights of holders of partnership interests, and (iii) with respect to a limited liability company, such Person’s certificate of formation, limited liability company agreement or other organizational document affecting the rights of holders of limited liability company interests. In each case, “Organizational Documents” shall include any shareholders or other agreement among any of the owners of the entity in question.

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“Other Charges” shall mean, if and to the extent applicable with respect to any Individual Property, maintenance charges, impositions other than Taxes, and any other charges, including, without limitation, vault charges and license fees for the use of vaults, chutes and similar areas adjoining such Individual Property, now or hereafter levied or assessed or imposed against such Individual Property or any part thereof.

“Owner’s Title Policy” shall mean that certain ALTA extended coverage owner’s policy of title insurance issued in connection with the closing of the Mortgage Loan insuring the Mortgage Borrower as the owner of the Property.

“Ownership Interest” means with respect to any Person, any ownership interest in such Person, direct or indirect, contingent or fixed, at any level or any tier, of any nature whatsoever, whether in the form of a partnership interest, stock interest, membership interest, equitable interest, beneficial interests, profit interest, loss interest, voting rights, control rights, management rights or otherwise.

“Participant” shall have the meaning set forth in Section 9.7.2(i) hereof.

“Partner” shall have the meaning set forth in Section 4.1.35(e) hereof.

“Payment Date” shall mean the first (1 ^st ) day of each calendar month during the term of the Loan or, if such day is not a Business Day, the immediately succeeding Business Day.

“Permitted Debt” shall have the meaning set forth in Section 4.1.35(a)(vii) hereof.

“Permitted Encumbrances” shall mean, collectively, (a) the Liens and security interests created by the Loan Documents, the Mortgage Loan Documents and the Mezzanine A Loan Documents, (b) all Liens, encumbrances and other matters disclosed in the Mortgage Title Insurance Policy relating to any Individual Property or any part thereof, (c) Liens, if any, for Taxes imposed by any Governmental Authority not yet delinquent or being contested in good faith and by appropriate proceedings in accordance with the applicable provisions of the Loan Documents, the Mortgage Loan Documents or the Mezzanine A Loan Documents, (d) other Liens that are being contested in good faith and by appropriate proceedings in accordance with the applicable provisions of the Loan Documents, the Mortgage Loan Documents or the Mezzanine A Loan Documents, (e) the rights of the lessors or secured parties under any equipment lease agreements permitted under the Mortgage Loan Documents, and any financing statements filed as evidence of such lessors’ or secured parties’ rights, (f) easements, rights-of-way, restrictions, encroachments, and other minor defects or irregularities in title, in each case, which are necessary for the operation of the Property and do not or would not have a Material Adverse Effect, and (g) such other title and survey exceptions as Mortgage Lender has approved or may approve in writing in Mortgage Lender’s sole discretion.

“Permitted Investments” shall mean any one or more of the following obligations or securities (including those issued by Servicer, the trustee under any Securitization or any of their respective Affiliates) acquired at a purchase price of not greater than par, and payable on demand or having a maturity date not later than the Business Day

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immediately prior to the date upon which such funds are required to be drawn and meeting one of the appropriate standards set forth below:

(i)                                      obligations of, or obligations fully guaranteed as to payment of principal and interest by, the United States or any agency or instrumentality thereof provided such obligations are backed by the full faith and credit of the United States of America including, without limitation, obligations of: the U.S. Treasury (all direct or fully guaranteed obligations), the Farmers Home Administration (certificates of beneficial ownership), the General Services Administration (participation certificates), the U.S. Maritime Administration (guaranteed Title XI financing), the Small Business Administration (guaranteed participation certificates and guaranteed pool certificates), the U.S. Department of Housing and Urban Development (local authority bonds) and the Washington Metropolitan Area Transit Authority (guaranteed transit bonds); provided, however , that the investments described in this clause must (A) have a predetermined fixed dollar of principal due at maturity that cannot vary or change, (B) if rated by S&P, must not have an “r” highlighter affixed to their rating, (C) if such investments have a variable rate of interest, such interest rate must be tied to a single interest rate index plus a fixed spread (if any) and must move proportionately with that index, and (D) such investments must not be subject to liquidation prior to their maturity;

(ii)                                   Federal Housing Administration debentures;

(iii)                                obligations of the following United States government sponsored agencies: Federal Home Loan Mortgage Corp. (debt obligations), the Farm Credit System (consolidated systemwide bonds and notes), the Federal Home Loan Banks (consolidated debt obligations), the Federal National Mortgage Association (debt obligations), the Financing Corp. (debt obligations), and the Resolution Funding Corp. (debt obligations); provided, however , that the investments described in this clause must (A) have a predetermined fixed dollar of principal due at maturity that cannot vary or change, (B) if rated by S&P, must not have an “r” highlighter affixed to their rating, (C) if such investments have a variable rate of interest, such interest rate must be tied to a single interest rate index plus a fixed spread (if any) and must move proportionately with that index, and (D) such investments must not be subject to liquidation prior to their maturity;

(iv)                               federal funds, unsecured certificates of deposit, time deposits, bankers’ acceptances and repurchase agreements with maturities of not more than 365 days of any bank, the short term obligations of which at all times are rated in the highest short term rating category by each Rating Agency (or, if not rated by all Rating Agencies, rated by at least one Rating Agency in the highest short term rating category and otherwise acceptable to each other Rating Agency, as confirmed in writing that such investment would not, in and of itself, result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities); provided, however , that the investments described in this clause must (A) have a predetermined fixed dollar of principal due at maturity that cannot vary or change, (B) if rated by S&P, must not have an “r” highlighter affixed to their rating, (C) if such investments have a variable rate of interest, such interest rate must be tied to a single interest rate index plus a fixed spread (if any) and

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must move proportionately with that index, and (D) such investments must not be subject to liquidation prior to their maturity;

(v)                                  fully Federal Deposit Insurance Corporation insured demand and time deposits in, or certificates of deposit of, or bankers’ acceptances with maturities of not more than 365 days and issued by, any bank or trust company, savings and loan association or savings bank, the short term obligations of which at all times are rated in the highest short term rating category by each Rating Agency (or, if not rated by all Rating Agencies, rated by at least one Rating Agency in the highest short term rating category and otherwise acceptable to each other Rating Agency, as confirmed in writing that such investment would not, in and of itself, result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities); provided, however , that the investments described in this clause must (A) have a predetermined fixed dollar of principal due at maturity that cannot vary or change, (B) if rated by S&P, must not have an “r” highlighter affixed to their rating, (C) if such investments have a variable rate of interest, such interest rate must be tied to a single interest rate index plus a fixed spread (if any) and must move proportionately with that index, and (D) such investments must not be subject to liquidation prior to their maturity;

(vi)                               debt obligations with maturities of not more than 365 days and at all times rated by each Rating Agency (or, if not rated by all Rating Agencies, rated by at least one Rating Agency and otherwise acceptable to each other Rating Agency, as confirmed in writing that such investment would not, in and of itself, result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities) in its highest long term unsecured rating category; provided, however , that the investments described in this clause must (A) have a predetermined fixed dollar of principal due at maturity that cannot vary or change, (B) if rated by S&P, must not have an “r” highlighter affixed to their rating, (C) if such investments have a variable rate of interest, such interest rate must be tied to a single interest rate index plus a fixed spread (if any) and must move proportionately with that index, and (D) such investments must not be subject to liquidation prior to their maturity;

(vii)                            commercial paper (including both non interest bearing discount obligations and interest-bearing obligations payable on demand or on a specified date not more than one year after the date of issuance thereof) with maturities of not more than 365 days and that at all times is rated by each Rating Agency (or, if not rated by all Rating Agencies, rated by at least one Rating Agency and otherwise acceptable to each other Rating Agency, as confirmed in writing that such investment would not, in and of itself, result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities) in its highest short term unsecured debt rating; provided, however , that the investments described in this clause must (A) have a predetermined fixed dollar of principal due at maturity that cannot vary or change, (B) if rated by S&P, must not have an “r” highlighter affixed to their rating, (C) if such investments have a variable rate of interest, such interest rate must be tied to a single interest rate index plus a fixed spread (if any) and must move proportionately with that index, and (D) such investments must not be subject to liquidation prior to their maturity;

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(viii)                         units of taxable money market funds, with maturities of not more than 365 days and which funds are regulated investment companies, seek to maintain a constant net asset value per share and invest solely in obligations backed by the full faith and credit of the United States, which funds have the highest rating available from each Rating Agency (or, if not rated by all Rating Agencies, rated by at least one Rating Agency and otherwise acceptable to each other Rating Agency, as confirmed in writing that such investment would not, in and of itself, result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities) for money market funds; and

(ix)                                 any other security, obligation or investment which has been approved as a Permitted Investment in writing by (a) Lender and (b) each Rating Agency, as evidenced by a written confirmation that the designation of such security, obligation or investment as a Permitted Investment will not, in and of itself, result in a downgrade, qualification or withdrawal of the then current ratings assigned to the Securities by such Rating Agency;

provided, however , that no obligation or security shall be a Permitted Investment if (A) such obligation or security evidences a right to receive only interest payments or (B) the right to receive principal and interest payments on such obligation or security are derived from an underlying investment that provides a yield to maturity in excess of 120% of the yield to maturity at par of such underlying investment.

“Permitted Transferee” shall have the meaning provided in Section 5.2.11(a)(ii) hereof.

“Person” shall mean any individual, corporation, partnership, joint venture, limited liability company, estate, trust, unincorporated association, any federal, State, county or municipal government or any bureau, department or agency thereof and any fiduciary acting in such capacity on behalf of any of the foregoing.

“Personal Property” shall mean the machinery, equipment, fixtures (including, but not limited to, the heating, air conditioning, plumbing, lighting, communications and elevator fixtures, inventory and goods) and other property of every kind and nature whatsoever owned by Mortgage Borrower, or in which Mortgage Borrower has or shall have an interest, now or hereafter located upon the applicable Individual Property, or appurtenant thereto, and usable in connection with the present or future operation and occupancy of the applicable Individual Property, and the building equipment, materials and supplies of any nature whatsoever owned by Mortgage Borrower, or in which Mortgage Borrower has or shall have an interest, now or hereafter located upon the applicable Individual Property, or appurtenant thereto, or usable in connection with the present or future operation and occupancy of the applicable Individual Property.

“Plan” shall mean an employee benefit plan (as defined in section 3(3) of ERISA) whether or not subject to ERISA or a plan or other arrangement within the meaning of Section 4975 of the Code.

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“Plan Assets” shall mean assets of a Plan within the meaning of section 29 C.F.R., Section 2510.3-101 or similar law.

“Pledge” shall mean, with respect to any Restricted Party, a voluntary or involuntary pledge of a direct or indirect legal or beneficial interest in such Restricted Party.

“Pledge Agreement” shall mean that certain Mezzanine B Pledge and Security Agreement dated as of the Closing Date, executed and delivered by Borrower to Lender as security for the Loan, as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time.

“Policies” shall have the meaning set forth in Section 6.1(b) hereof.

“Prepayment Date” shall have the meaning set forth in Section 2.3.1(b) hereof.

“Present Value Factor” means:

1 / ((1 + Eurodollar Rate Margin) ((12+n)/12) )

Where n = the nth Payment Date; for example, if the Loan is prepaid on the first Payment Date, the Spread Maintenance Payment would be the Spread Payment times the Present Value Factor for each of the remaining Payment Dates in the Spread Maintenance Period beginning with n =2.

“Prime Rate” shall mean, on a particular date, a rate per annum equal to the rate of interest published in The Wall Street Journal as the “prime rate”, as in effect on such day, with any change in the prime rate resulting from a change in said prime rate to be effective as of the date of the relevant change in said prime rate; provided, however, that if more than one prime rate is published in The Wall Street Journal for a day, the average of the prime rates shall be used; provided, further, however, that the Prime Rate (or the average of the prime rates) will be rounded to the nearest 1/1000 of 1% or, if there is no nearest 1/1000 of 1%, to the next higher 1/1000 of 1%. In the event that The Wall Street Journal should cease or temporarily interrupt publication, then the Prime Rate shall mean the daily average prime rate published in another business newspaper, or business section of a newspaper, of national standing chosen by Lender. If The Wall Street Journal resumes publication, the substitute index will immediately be replaced by the prime rate published in The Wall Street Journal. In the event that a prime rate is no longer generally published or is limited, regulated or administered by a governmental or quasi-governmental body, then Lender shall select a reasonably comparable interest rate index which is readily available to Borrower and verifiable by Borrower but is beyond the control of Lender. Lender shall give Borrower prompt written notice of its choice of a substitute index and when the change became effective. Such substitute index will also be rounded to the nearest 1/1000 of 1% or, if there is no nearest 1/1000 of 1%, to the next higher 1/1000 of 1%. The determination of the Prime Rate by Lender shall be conclusive and binding absent manifest error.

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“Principal” shall mean, with respect to any Borrower Entity, the general partner of such Borrower Entity, if such Borrower Entity is a partnership, or the managing member of such Borrower Entity, if such Borrower Entity is a limited liability company that does not comply with the provisions of Sections 4.1.35(b), (c) and (d) hereof, together with its successors and assigns.

“Prohibited Person” shall mean any Person:

(a)                                   listed in the Annex to, or otherwise subject to the provisions of, the Executive Order No. 13224 on Terrorist Financing, effective September 24, 2001, and relating to Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism (the “Executive Order”);

(b)                                  that is owned or controlled by, or acting for or on behalf of, any person or entity that is listed to the Annex to, or is otherwise subject to the provisions of, the Executive Order;

(c)                                   with whom Lender is prohibited from dealing or otherwise engaging in any transaction by the Executive Order;

(d)                                  who has been identified by any U.S. Governmental Authority having jurisdiction with respect to such matters as a Person who commits, threatens or conspires to commit or supports “terrorism” as defined in the Executive Order;

(e)                                   that is named as a “specially designated national and blocked person” on the most current list published by the U.S. Treasury Department Office of Foreign Assets Control at its official website, http://www.treas.gov.ofac/t11sdn.pdf or at any replacement website or other replacement official publication of such list; or

(f)                                     who is an Affiliate of a Person listed above.

“Projections” shall have the meaning set forth in Section 9.7.3(b) hereof.

“Properties” shall mean, collectively, the Individual Properties which are subject to the terms of the Mortgage Loan Documents, in each case if and to the extent that the same is encumbered by a Security Instrument and has not been released therefrom pursuant to the terms hereof.

“Property” shall mean, as the context may require, the Properties or an Individual Property.

“Provided Information” shall have the meaning set forth in Section 9.1(a) hereof.

“Qualified Manager” shall mean (a) TSP or an Affiliate thereof, (b) Archstone Property Management LLC, a Delaware limited liability company, (c) Archstone Property Management (California) Incorporated, a Delaware corporation, (d) a reputable and experienced professional management organization which manages, together with its Affiliates, no fewer than ten (10) first class luxury residential apartment buildings of a

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type and size similar to the Properties, totaling in the aggregate no less than 2500 residential units; provided, however, that the employment of such organization described in this clause (b) as manager of the Properties shall be conditional, (i) if it shall occur prior to the occurrence of a Securitization, upon approval of such employment by Lender, such approval not to be unreasonably withheld, and (ii) if it shall occur after the occurrence of a Securitization, upon Lender having received written confirmation from the Rating Agencies that the employment of such manager will not result in a downgrade, withdrawal or qualification of the initial, or if higher, then current ratings of the Securities.

“Rating Agency” shall mean each of S&P, Moody’s, and Fitch, and any other nationally recognized statistical rating agency which has been selected by Lender and, in each case, has rated the Securities.

“Rating Agency Confirmation” means each of the Rating Agencies shall have confirmed in writing that the occurrence of the event with respect to which such Rating Agency Confirmation is sought shall not result in a downgrade, qualification or withdrawal of the initial, or, if higher, the then current ratings assigned to the Securities in connection with a Securitization. In the event that no Securities are outstanding or the Loan is not part of a Securitization, any action that would otherwise require a Rating Agency Confirmation shall require the consent of the Lender, which consent shall not be unreasonably withheld or delayed.

“Recourse Events” shall have the meaning set forth in Section 9.4(b) hereof.

“Reference Bank ” shall mean a leading bank engaged in transactions in Eurodollar deposits in the international Eurocurrency market that has an established place of business in London. If any such Reference Bank should be removed from the Reuters Screen LIBOR01 Page or in any other way fail to meet the qualifications of a Reference Bank, Lender may designate alternative Reference Banks meeting the criteria specified above.

“Register” shall have the meaning set forth in Section 9.7.2(h) hereof.

“Regulatory Change” shall mean any change after the date of this Agreement (or with respect to any assignee hereunder, after the date such assignee becomes a Lender) in federal, state or foreign laws or regulations or the adoption or the making, after such date, of any interpretations, directives or requests applying to a class of banks or companies controlling banks, including such Lender or any company controlling such Lender, of or under any federal, state or foreign laws or regulations (whether or not having the force of law) by any court or governmental or monetary authority charged with the interpretation or administration thereof.