AMENDED AND RESTATED CREDIT AGREEMENT Dated December 13, 2004 Among ARCHSTONE- SMITH OPERATING TRUST, as Borrower and ARCHSTONE-SMITH TRUST, as Parent and JPMORGAN CHASE BANK, N.A. As Administrative Agent and BANK OF AMERICA, N.A., and WELLS FARGO BANK, …

 

Exhibit 10.16

AMENDED AND RESTATED CREDIT AGREEMENT

Dated

December 13, 2004

among

ARCHSTONE-SMITH OPERATING TRUST,
as Borrower

and

ARCHSTONE-SMITH TRUST,
as Parent

and

JPMORGAN CHASE BANK, N.A.
as Administrative Agent

and
BANK OF AMERICA, N.A., and
WELLS FARGO BANK, N.A.
as Syndication Agents


and

SUNTRUST BANK and
COMMERZBANK AG, NEW YORK AND
GRAND CAYMAN BRANCHES
as Documentation Agents


and

the Lenders Party Hereto

J. P. MORGAN SECURITIES INC.,
as Lead Arranger and Sole Bookrunner


 

TABLE OF CONTENTS

         
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  10.4 Choice of Law     57  
  10.5 Survival; Parties Bound; Successors and Assigns     58  
  10.6 Counterparts     61  
  10.7 Usury Not Intended; Refund of Any Excess Payments     61  
  10.8 Captions     62  
  10.9 Severability     62  
  10.10 Disclosures     62  
  10.11 No Novation     62  
  10.12 Limitation of Liability     62  
  10.13 Entire Agreement     62  
 
           
SCHEDULE I: Guarantor        
 
           
EXHIBITS:        
A –
  Officer’s Certificate        
B –
  Request for Loan        
C –
  Note        
C-1-
  Swing Loan Note        
C-2-
  Master Note        
D –
  Legal Opinion        
E –
  Money Market Quote Request        
F –
  Invitation for Money Market Quotes        
G –
  Money Market Quote        
H –
  Designation Agreement        
I –
  Form of Guaranty        
J –
  Assignment and Assumption Agreement        
K –
  Form of Additional Guaranty        

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AMENDED AND RESTATED
CREDIT AGREEMENT

     THIS AMENDED AND RESTATED CREDIT AGREEMENT (the “Agreement”) is made and entered into as ofDecember 13, 2004, by and among ARCHSTONE-SMITH OPERATING TRUST, a Maryland real estate investmenttrust (the “Borrower”), ARCHSTONE-SMITH TRUST, a Maryland real estate investment trust, and theparent of the Borrower (the “Parent”), the financial institutions (including JPMC, the SyndicationAgents and the Documentation Agents, the “Lenders”) which are now or may hereafter becomesignatories hereto, JPMORGAN CHASE BANK, N.A., a national banking association (formerly known asJPMorgan Chase Bank) (“JPMC”), as administrative agent for Lenders (in such capacity, “Agent”),BANK OF AMERICA, N.A. and WELLS FARGO BANK, N.A., and as syndication agents for Lenders (in suchcapacity, “Syndication Agents”), and SUNTRUST BANK and COMMERZBANK AG, NEW YORK and GRAND CAYMANBRANCHES, as documentation agents for Lenders (in such capacity, “Documentation Agents”).

     WHEREAS, the Borrower, the Agent and certain of the Lenders entered into an Amended andRestated Credit Agreement dated as of October 30, 2003 (as amended to the date hereof, the“Original Credit Agreement”); and

     WHEREAS, the Borrower has requested that the Agent and the Lenders amend and restate theOriginal Credit Agreement and the Agent and the Lenders have agreed to do so pursuant to the termsof this Agreement; and

     WHEREAS, the Borrower desires to obtain Loans and obtain Letters of Credit (as such terms arehereinafter defined) from the Lenders; and

     WHEREAS, subject to and upon the terms and conditions set forth herein, the Lenders arewilling to make Loans and provide for the issuance of Letters of Credit to the Borrower, asprovided for herein;

     NOW, THEREFORE, in consideration of the premises and the covenants and agreements containedherein, the adequacy of which is hereby acknowledged, the parties hereto hereby agree that theaforementioned recitals are true and correct and hereby incorporated herein and that the partieshereto hereby agree as follows:

1. Definitions.

     Unless a particular word or phrase is otherwise defined or the context otherwise requires,capitalized words and phrases used in Credit Documents have the meanings provided below.

     Absolute Rate Auction shall mean a solicitation of Money Market Quotes setting forthMoney Market Absolute Rates pursuant to Section 2.8.

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     Acceptable Credit Rating shall mean a Credit Rating from two of Standard & Poor’sRating Services, Moody’s Investors Service, Inc., or Fitch (one of which must be an S&P Rating or aMoody’s Rating) equal to a Credit Rating from Fitch, or an S&P Rating of BBB- or better, or aMoody’s Rating of Baa3 or better.

     Accounts, Equipment and Inventory shall have the respective meanings assigned to them in theTexas Business and Commerce Code in force on the date the document using such term was executed.

     Administrative Questionnaire means an Administrative Questionnaire in a form suppliedby the Agent.

     Affiliate shall mean any Person controlling, controlled by or under common controlwith any other Person. For purposes of this definition, “control” (including “controlled by” and“under common control with”) means the possession, directly or indirectly, of the power to director cause the direction of the management and policies of such Person, whether through the ownershipof voting securities or otherwise.

     Annual Audited Financial Statements shall mean the annual financial statements of aPerson, including all notes thereto, which statements shall include a balance sheet as of the endof such fiscal year and an income statement and a statement of cash flows, all setting forth incomparative form the corresponding figures from the previous fiscal year, all prepared inconformity with Generally Accepted Accounting Principles and accompanied by a report and opinion ofindependent certified public accountants satisfactory to the Agent, which shall state that suchfinancial statements, in the opinion of such accountants, present fairly the financial position ofsuch Person as of the date thereof and the results of its operations for the period covered therebyin conformity with Generally Accepted Accounting Principles. Such statements shall be accompaniedby a certificate of such accountants that in making the appropriate audit and/or investigation inconnection with such report and opinion, such accountants did not become aware of any Default or,if in the opinion of such accountant any such Default exists, a description of the nature andstatus thereof. The Annual Audited Financial Statements shall be prepared on a consolidated basisin accordance with Generally Accepted Accounting Principles.

     Applicable Margin shall mean (a) if a Credit Rating is obtained from more than oneagency, and one of the two highest Credit Ratings is an S&P Rating or a Moody’s Rating, thefollowing percentage based on the corresponding Credit Rating which is the second highest, or (b)if the one of the two highest Credit Ratings in clause (a) above is not an S&P Rating or aMoody’s Rating, the following percentage based on the corresponding S&P Rating or Moody’s Ratingwhich is the highest, or (c) if only one Credit Rating is obtained, which must be an S&P Rating ora Moody’s Rating, the following percentage based on the corresponding S&P Rating or Moody’s Rating:

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APPLICABLE MARGIN

         
APPLICABLE   EURODOLLAR RATE   BASE RATE
CREDIT RATING   BORROWING   BORROWING
A/A2 or better
  0.425%   0
A-/A3
  0.450%   0
BBB+/Baa1
  0.500%   0
BBB/Baa2
  0.600%   0
BBB-/Baa3
  0.800%   0
Worse than BBB-/Baa3
  1.250%   .25%
or no Credit Rating
       

Each Applicable Margin shall be in effect whenever and for so long as the corresponding CreditRating or no Credit Rating is in effect.

     Assignment and Assumption means an assignment and assumption entered into by a Lenderand an assignee (with the consent of any party whose consent is required by Section 10.5),and accepted by the Agent, in the form of Exhibit J or any other form approved by theAgent.

     Base Rate shall mean for any day a rate per annum equal to the Applicable Margin onthat day plus the greater on a daily basis of (a) the Prime Rate for that day, or (b) the FederalFunds Effective Rate for that day plus one-half of one percent (1/2%).

     Base Rate Borrowing shall mean that portion of the principal balance of the Loans atany time bearing interest at the Base Rate.

     Business Day shall mean a day other than (a) a day when the main office of the Agentis not open for business, or (b) a day that is a federal banking holiday in the United States ofAmerica.

     Calculation Date shall mean the beginning of the first full calendar quarter after theStabilization Date.

     Capital Lease Obligations of any Person means the obligations of such Person to payrent or other amounts under any lease of (or other arrangement conveying the right to use) real orpersonal property, or a combination thereof, which obligations are required to be classified andaccounted for as capital leases on a balance sheet of such Person under Generally AcceptedAccounting Principles, and the amount of such obligations shall be the capitalized amount thereofdetermined in accordance with Generally Accepted Accounting Principles.

     Ceiling Rate shall mean, on any day, the maximum nonusurious rate of interestpermitted for that day by whichever of applicable federal or Texas laws permits the higher interestrate, stated as a rate per annum. On each day, if any, that Texas law establishes the

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Ceiling Rate, the Ceiling Rate shall be the “weekly ceiling” (as defined in Chapter 303 of theTexas Finance Code, as amended (the “Texas Finance Code”)) for that day. The Agent may from timeto time, as to current and future balances, implement any other ceiling under the Texas FinanceCode by notice to the Borrower, if and to the extent permitted by the Texas Finance Code. Withoutnotice to the Borrower or any other person or entity, the Ceiling Rate shall automaticallyfluctuate upward and downward as and in the amount by which such maximum nonusurious rate ofinterest permitted by applicable law fluctuates.

     Code shall mean the Internal Revenue Code of 1986, as amended, as now or hereafter ineffect, together with all regulations, rulings and interpretations thereof or thereunder by theInternal Revenue Service.

     Commitment shall mean the commitment of the Lenders to lend funds under Section2.1 of this Agreement, other than Swing Loans. The aggregate Commitment on the date hereof is$600,000,000.00.

     Committed Loan shall mean Loans other than Money Market Loans.

     Construction Interest shall mean Borrower’s interest expense for the construction ofprojects, which is capitalized in accordance with Generally Accepted Accounting Principles.

     Coverage Ratio shall mean the ratio of (a) the Borrower’s EBITDA (calculated by addingthe Parent’s Interest Expense) for the immediately preceding four (4) calendar quarters, to (b)dividends or other distributions of any kind or character paid or payable with respect to anyDisqualified Stock plus all of the Borrower’s and the Parent’s Interest Expense, in each case forthe period used to calculate EBITDA.

     Credit Documents shall mean this Agreement, the Notes, any Guaranty, all instruments,certificates and agreements now or hereafter executed or delivered to the Agent or the Lenderspursuant to any of the foregoing, and all amendments, modifications, renewals, extensions,increases and rearrangements of, and substitutions for, any of the foregoing.

     Credit Rating shall mean the S&P Rating, the Moody’s Rating, or the rating assigned byFitch to Borrower’s senior unsecured indebtedness.

     DC Holdings Entities shall mean Metropolitan Acquisition Finance LP, Smith PropertyHoldings Cronin’s Landing LP, Smith Property Holdings Crystal towers LP, Smith Property HoldingsOne LP, Smith Property Holdings Two LP, Smith Property Holdings Three LP, Smith Property HoldingsFour LP, Smith Property Holdings Five LP, Smith Property Holdings Six LP, Smith Property HoldingsSeven LP, Smith Property Holdings Alban Towers LLC, First Herndon Associates LP, Smith PropertyHoldings One (DC) LP, Smith Property Holdings Two (DC) LP, Smith Property Holdings Three (DC) LP,Smith Property Holdings Kenmore LP, Smith Property Holdings Five (DC) LP, Smith Property HoldingsSix (DC) LP, Smith Property Holdings Van Ness LP, Smith Property Holdings Consulate LLC and SmithProperty Holdings Columbia Road LP, Smith Property

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Holdings 4411 Connecticut Avenue LLC, ASN Dupont LLC, and any Person formed solely for thepurpose of owning Real Property in the District of Columbia.

     Debt to Total Asset Value Ratio shall mean the ratio (expressed as a percentage) of(a) the sum of the Borrower’s and the Parent’s Indebtedness to (b) Total Asset Value.

     Designated Lender shall mean a special purpose corporation that (a) shall have becomea party to this Agreement pursuant to Section 10.5(f), and (b) is not otherwise aLender.

     Designated Lender Notes shall mean promissory notes of the Borrower, substantially inthe form of Exhibit C hereto, evidencing the obligation of the Borrower to repay MoneyMarket Loans made by Designated Lenders, and Designated Lender Note means any one of suchpromissory notes issued under Section 10.5(f).

     Designating Lender shall have the meaning set forth in Section 10.5(f).

     Designation Agreement shall mean a designation agreement in substantially the form ofExhibit H attached hereto, entered into by a Lender and a Designated Lender and accepted bythe Agent.

     Disqualified Stock shall mean any of the Borrower’s capital stock which by its terms(or by the terms of any security into which it is convertible or for which it is exchangeable orexercisable) (a) matures or is subject to mandatory redemption, pursuant to a sinking fundobligation or otherwise, (b) is convertible into or exchangeable or exercisable for Indebtednessor Disqualified Stock, (c) is redeemable at the option of the holder of such stock, or (d)otherwise requires any payments by Borrower, in each case on or before the Maturity Date.

     EBITDA means an amount derived from (a) net income (including all net cash gains andlosses on dispositions of Real Property in accordance with Generally Accepted AccountingPrinciples), including (without duplication) the Equity Percentage of EBITDA for the Borrower’sUnconsolidated Affiliates, plus (b) to the extent included in the determination of net income,depreciation, amortization, Interest Expense, income taxes, deferred taxes and other non-cashcharges, minority interest, extraordinary losses, prepayment penalties and make-whole costs paid inconnection with prepayment of Indebtednesss, and payments made on Borrower’s preferred stock, minus(c) to the extent included in the determination of net income, any extraordinary gains, in eachcase, as determined on a consolidated basis in accordance with Generally Accepted AccountingPrinciples.

     Equity Percentage shall mean the aggregate ownership interest of Borrower in eachUnconsolidated Affiliate, which shall be calculated as Borrower’s economic ownership interest insuch Person, reflecting Borrower’s share of income and expenses of such Person.

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     Eurodollar Business Day shall mean a Business Day on which transactions in UnitedStates dollar deposits between banks may be carried on in the London interbank dollar market.

     Eurodollar Interbank Rate shall mean, for each Interest Period, the rate of interestper annum, rounded, if necessary, to the next highest whole multiple of one-sixteenth percent(1/16%), quoted by Agent at or before 11:00 a.m., London time (or as soon thereafter aspracticable), on the date two (2) Eurodollar Business Days before the first day of such InterestPeriod, to be the arithmetic average of the prevailing rates per annum at the time of determinationand in accordance with the then existing practice in the London interbank dollar market, for theoffering to Agent by one or more prime banks selected by Agent in its sole discretion, in theLondon interbank dollar market, of deposits in United States dollars for delivery on the first dayof such Interest Period and having a maturity equal to the length of such Interest Period and in anamount equal (or as nearly equal as may be) to the Eurodollar Rate Borrowing to which such InterestPeriod relates. Each determination by Agent of the Eurodollar Interbank Rate shall be prima facieevidence thereof.

     Eurodollar Rate shall mean for any day a rate per annum equal to the sum of theApplicable Margin for that day plus the Eurodollar Interbank Rate in effect on the first day of theInterest Period for the applicable Eurodollar Rate Borrowing. Each Eurodollar Rate is subject toadjustments for reserves, insurance assessments and other matters as provided for in Section3.5 hereof.

     Eurodollar Rate Borrowing shall mean that portion of the principal balance of theLoans at any time bearing interest at a Eurodollar Rate.

     Eurodollar Reserve Requirement shall mean, on any day, the cost incurred by a Lenderas a reserve requirement (including, without limitation, basic, supplemental, marginal andemergency reserves) applicable to “Eurocurrency liabilities,” as currently defined in Regulation D,all as specified by any Governmental Authority, including but not limited to those imposed underRegulation D, because of that Lender making a Eurodollar Rate Borrowing or a Money Market LIBORLoan available to the Borrower.

     Event of Default shall mean any of the events specified as an event of default inSection 7 of this Agreement, and Default shall mean any of such events, whether or not anyrequirement for notice, grace or cure has been satisfied.

     Federal Funds Effective Rate shall to the extent necessary be determined by the Agentseparately for each day and shall for each such day be a rate per annum equal to the weightedaverage of the rates on overnight Federal funds transactions with members of the Federal ReserveSystem arranged by Federal funds brokers, as published for each such day (or if any such day is nota Business Day, for the next immediately preceding Business Day) by the Federal Reserve Bank of NewYork, or if the weighted average of such rates is not so published for any such day which is aBusiness Day, the average of the quotations for any such day on such transactions received by theAgent from three Federal funds brokers of recognized standing selected by the Agent.

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     Fee shall mean, collectively, the fee described in Section 2.7.

     Fitch shall mean Fitch, Inc.

     Fixed Charge Coverage Ratio shall mean the ratio of (a) the Borrower’s EBITDA(calculated by adding the Parent’s Interest Expense) for the immediately preceding four (4)calendar quarters, less Unit Capital Expenditures, to (b) dividends of any kind or character orother proceeds paid or payable with respect to any Disqualified Stock, plus all of the Borrower’sand the Parent’s Interest Expense, plus all of the principal payable and principal paid on theBorrower’s and the Parent’s Indebtedness (but not including prepayment penalties and make-wholecosts not included in the calculation of EBITDA) other than (i) any final scheduled principalpayment on any Indebtedness which pays such Indebtedness in full, to the extent the amount of suchscheduled principal payment is greater than the scheduled principal payment immediately precedingsuch final scheduled principal payment and (ii) scheduled principal payments on the Borrower’s andthe Parent’s Indebtedness incurred prior to December 13, 2004 which has a rating from Standard &Poor’s Rating Services, Moody’s Investor Service, Inc. or Fitch which is the equivalent ofBBB-/Baa3 or better at the time of issuance, in each case for the period used to calculate EBITDA.

     Funding Loss shall mean, with respect to (a) Borrower’s payment or prepayment ofprincipal of a Eurodollar Rate Borrowing or a Money Market Loan on a day other than the last day ofthe applicable Interest Period; (b) Borrower’s failure to borrow a Eurodollar Rate Borrowing or aMoney Market Loan on the date specified by Borrower; (c) Borrower’s failure to make any prepaymentof the Loans (other than Base Rate Borrowings) on the date specified by Borrower, or (d) anycessation of a Eurodollar Rate to apply to the Loans or any part thereof pursuant to Section3.5, in each case whether voluntary or involuntary, any direct loss, expense, penalty, premiumor liability incurred by any Lender (including but not limited to any loss or expense incurred byreason of the liquidation or reemployment of deposits or other funds acquired by a Lender to fundor maintain a Loan).

     Generally Accepted Accounting Principles shall mean, as to a particular Person, suchaccounting practice as, in the opinion of the independent accountants of recognized nationalstanding regularly retained by such Person and acceptable to the Agent, conforms at the time togenerally accepted accounting principles, consistently applied. Generally Accepted AccountingPrinciples means those principles and practices (a) which are recognized as such by the FinancialAccounting Standards Board, (b) which are applied for all periods after the date hereof in a mannerconsistent with the manner in which such principles and practices were applied to the most recentaudited financial statements of the relevant Person furnished to the Lenders or where a changetherein has been concurred in by such Person’s independent auditors, and (c) which are consistentlyapplied for all periods after the date hereof so as to reflect properly the financial condition,and results of operations and changes in financial position, of such Person. If there is a changein such accounting practice as to the Borrower that could affect the Borrower’s ability to complywith the terms of this Agreement, the parties hereto agree to review and discuss such changes inaccounting practice and the terms of this Agreement for a period of no more

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than thirty (30) days with a view to amending this Agreement so that the financial measures ofthe Borrower’s operating performance and financial condition are substantially the same after suchchange as they were immediately before such change.

     Governmental Authority shall mean any foreign governmental authority, the UnitedStates of America, any State of the United States and any political subdivision of any of theforegoing, and any agency, department, commission, board, bureau, court or other tribunal havingjurisdiction over the Agent, any Lender or the Borrower or their respective Property.

     Guarantor shall mean each Subsidiary of Borrower that executes a Guaranty as requiredby Section 5.15 hereof. Guarantor as of the date hereof is the Persons listed onSchedule I attached hereto.

     Guaranty (whether one or more) shall mean a Guaranty in the form of Exhibit Iattached hereto and made a part hereof.

     Hedging Agreements shall mean any interest rate protection agreement, foreign currencyexchange agreement, commodity price protection agreement or other interest or currency exchangerate or commodity price hedging agreement.

     Historical Value shall mean the purchase price of Real Property (includingimprovements) and ordinary related purchase transaction costs, plus the cost of subsequent capitalimprovements made by the Borrower, less any provision for losses, all determined in accordance withGenerally Accepted Accounting Principles. If the Real Property is purchased as a part of a groupof properties, the Historical Value shall be calculated based upon a reasonable allocation of theaggregate purchase price by the Borrower, and consistent with Generally Accepted AccountingPrinciples.

     Indebtedness shall mean and include, without duplication (1) all obligations forborrowed money, (2) all obligations evidenced by bonds, debentures, notes or other similaragreements, (3) all obligations to pay the deferred purchase price of Property or services, exceptaccrued expenses and trade accounts payable arising in the ordinary course of business (unlessincluded in (6) below), (4) all guaranties and endorsements and other contingent obligations inrespect of, or any obligations to purchase or otherwise acquire, Indebtedness of others (providedthat, where the guarantor is not the sole owner of the Person whose Indebtedness is guaranteed, andwhere the guaranty is of that portion of the Indebtedness remaining unpaid after the collection ofthe collateral for the Indebtedness, the amount guaranteed that is less than twenty-five percent(25%) of the Historical Value of said related collateral will not be included in the calculation ofIndebtedness), (5) all Indebtedness secured by any Lien existing on any interest of the Person withrespect to which Indebtedness is being determined in Property owned subject to such Lien whether ornot the Indebtedness secured thereby shall have been assumed, (6) accounts payable, dividends ofany kind or character or other proceeds payable with respect to any stock and accrued expenseswhich in the aggregate are in excess of five percent (5%) of the undepreciated value of the assetsof the Borrower, (7) payments received in consideration for sale of Borrower’s stock when theamount of the stock so sold is determined, and the

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date of delivery is, more than one (1) month after receipt of such payment and only to theextent that the obligation to deliver stock is not payable solely in stock of the Borrower, (8) allobligations under Hedging Agreements (calculated on a mark-to-market basis as of the reportingdate) other than Hedging Agreements related to interest rates on identified outstanding borrowedmoney Indebtedness, and (9) all Capital Lease Obligations of such Person. Indebtedness shall becalculated on a consolidated basis in accordance with Generally Accepted Accounting Principles,including (without duplication) the Equity Percentage of Indebtedness for the Borrower’sUnconsolidated Affiliates.

     Interest Expense shall mean all of a Person’s paid, accrued or capitalized interestexpense on such Person’s Indebtedness (whether direct, indirect or contingent, and including,without limitation, interest on all convertible debt), but excluding Construction Interest.

     Interest Options shall mean the Base Rate and the Eurodollar Rate, and “InterestOption” means either of them.

     Interest Payment Dates shall mean (a) the first (1st) day of each calendar month andthe Maturity Date, for Base Rate Borrowings and Eurodollar Rate Borrowings; and (b) for MoneyMarket Loans, the last day of each Interest Period and the maturity date of the Money Market Loans

     Interest Period shall mean:

          (1) For each Eurodollar Rate Borrowing, a period commencing on the date suchEurodollar Rate Borrowing was made and ending on the numerically corresponding day whichis, subject to availability, (a) one (1), two (2), three (3) or six (6) months thereafter,or (b) seven (7), fourteen (14) or twenty-one (21) days thereafter for no more than four(4) time periods (provided that the first Eurodollar Rate Borrowing under this Agreementwith an Interest Period of seven (7) days shall not count against the four time maximum)each calendar year in connection with payments of the Loans because of debt and/or equitysales by the Borrower, changes in the Lender Commitments, sales of major assets by theBorrower, or other similar reasons specifically approved by the Agent; provided that, (v)any Interest Period which would otherwise end on a day which is not a Eurodollar BusinessDay shall be extended to the next succeeding Eurodollar Business Day, unless suchEurodollar Business Day falls in another calendar month, in which case such Interest Periodshall end on the next preceding Eurodollar Business Day; (w) any Interest Period whichbegins on the last Eurodollar Business Day of a calendar month (or on a day for which thereis no numerically corresponding day in the calendar month at the end of such InterestPeriod) shall end on the last Eurodollar Business Day of the appropriate calendar month;(x) no Interest Period shall ever extend beyond the Maturity Date; and (y) Interest Periodsshall be selected by Borrower in such a manner that the Interest Period with respect to anyportion of the Loans which shall become due shall not extend beyond such due date .

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          (2) For each Money Market LIBOR Loan, the period commencing on the date such MoneyMarket LIBOR Loan was made and ending one (1), two (2), three (3) or six (6) monthsthereafter, as the Borrower may elect in the applicable Notice of Money Market Borrowing inaccordance with Section 2.8; provided that such Interest Period shall be limited asprovided in clauses (1)(v) through (y) above.

          (3) With respect to each Money Market Absolute Rate Loan, the period commencing on thedate such Money Market Absolute Rate was made and ending such number of days thereafter(but not less than 14 days) as the Borrower may elect in accordance with Section2.8; provided that such Interest Period shall be limited as provided in clauses(1)(x) and (y) above.

     Issuing Bank (whether one or more) means JPMorgan Chase Bank, N.A. and up to five (5)other Lenders, in their capacity as the issuer of Letters of Credit hereunder, and their successorsin such capacity as provided in Section 2.2(i). The Issuing Bank may, in its discretion,arrange for one or more Letters of Credit to be issued by Affiliates of the Issuing Bank, in whichcase the term “Issuing Bank” shall include any such Affiliate with respect to Letters of Creditissued by such Affiliate.

     LC Disbursement means a payment made by the Issuing Bank pursuant to a Letter ofCredit.

     LC Exposure means, at any time, the sum of (a) the aggregate undrawn amount of alloutstanding Letters of Credit at such time plus (b) the aggregate amount of all LC Disbursementsthat have not yet been reimbursed by or on behalf of the Borrower at such time. The LC Exposure ofany Lender at any time shall be its Percentage of the total LC Exposure at such time.

     Legal Requirement shall mean any law, statute, ordinance, decree, requirement, order,judgment, rule, regulation (or interpretation of any of the foregoing) of, and the terms of anylicense or permit issued by, any Governmental Authority.

     Lender Commitment means, for any Lender, the amount set forth opposite such Lender’sname on its signature page of this Agreement, or as may hereafter become a signatory hereto, asadjusted to reflect assignments or amendments made in accordance with this Agreement.

     Letter of Credit means any letter of credit issued pursuant to this Agreement.

     LIBOR Auction shall mean a solicitation of Money Market Quotes setting forth MoneyMarket Margins based on the Eurodollar Interbank Rate pursuant to Section 2.8.

     Lien shall mean any mortgage, pledge, charge, encumbrance, security interest,collateral assignment, negative pledge or other lien or restriction of any kind, whether based oncommon law, constitutional provision, statute or contract, and shall include

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reservations, exceptions, encroachments, easements, rights of way, covenants, conditions,restrictions, leases and other title exceptions.

     Limiting Agreements shall mean any agreement, instrument or transaction, including,without limitation, a Person’s Organizational Documents, which has or may have the effect ofprohibiting or limiting any Person’s ability to pledge assets in the Pool to secure Indebtedness.

     Loans shall mean the Loans described in Sections 2.1, 2.2 and2.8 hereof. Loan shall mean any such Loan.

     Majority Lenders shall mean the Lenders with an aggregate amount in excess of fiftypercent (50%) of the amount of the Commitment then outstanding, and after the Commitment hasexpired or terminated, shall mean Lenders with an aggregate amount in excess of fifty percent (50%)of the unpaid principal balance of the Revolving Credit Exposures.

     Material Adverse Change shall mean a change which could reasonably be expected to havea Material Adverse Effect.

     Material Adverse Effect means a material adverse effect on (a) the financialcondition, or results of operations of Borrower and its Subsidiaries taken as a whole, (b) theability of Borrower to perform its material obligations under the Credit Documents to which it is aparty taken as a whole, (c) the validity or enforceability of such Credit Documents taken as awhole, or (d) the material rights and remedies of Lenders and Agent under the Credit Documentstaken as a whole.

     Maturity Date shall mean three (3) years after the date hereof, unless extendedpursuant to Section 9.

     Money Market Absolute Rate has the meaning set forth in Section 2.8.

     Money Market Absolute Rate Loan shall mean a loan to be made by a Lender pursuant toan Absolute Rate Auction.

     Money Market LIBOR Loan shall mean a loan to be made by a Lender pursuant to a LIBORAuction.

     Money Market Loan shall mean a Money Market LIBOR Loan or a Money Market Absolute RateLoan, as the context may require or allow.

     Money Market Margin has the meaning set forth in Section 2.8.

     Money Market Quote shall mean an offer by a Lender to make a Money Market Loan inaccordance with Section 2.8.

     Moody’s Rating shall mean the senior unsecured debt rating from time to time receivedby the Borrower from Moody’s Investors Service, Inc.

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     Net Operating Income shall mean, for any income producing operating properties, thedifference between (a) any cash rentals, proceeds and other income received from such Property (butexcluding security or other deposits, or other income of an extraordinary and non-recurring nature)during the determination period, less (b) all cash costs and expenses (excluding interest expenseand any expenditures that are capitalized in accordance with Generally Accepted AccountingPrinciples) incurred as a result of, or in connection with, or properly allocated to, the operationor leasing of such Property during the determination period. Net Operating Income shall becalculated on a consolidated basis in accordance with Generally Accepted Accounting Principles, andincluding (without duplication) the Equity Percentage of Net Operating Income for the Borrower’sUnconsolidated Affiliates.

     Non-recourse Debt shall mean any Indebtedness the payment of which the Borrower or anyof its Subsidiaries is not obligated to make other than to the extent of any security therefor.

     Notes shall mean the promissory notes of the Borrower described in Section 2.1hereof, including the Swing Loan Note, any and all renewals, extensions, modifications,rearrangements and replacements thereof and any and all substitutions therefor, and Note shall meanany one of them.

     Obligations shall mean, as at any date of determination thereof, the sum of (a) theaggregate Revolving Credit Exposures plus (b) all other liabilities, obligations and Indebtednessof any Parties under any Credit Document.

     Occupancy Level shall mean the occupancy level of a Property that is leased to bonafide tenants paying rent under written leases, based on the average of the actual occupancy levelfor the immediately preceding three (3) months.

     Officer’s Certificate shall mean a certificate in the form attached hereto asExhibit A.

     Organizational Documents shall mean, with respect to a corporation, the certificate ofincorporation, articles of incorporation and bylaws of such corporation; with respect to apartnership, the partnership agreement establishing such partnership; with respect to a jointventure, the joint venture agreement establishing such joint venture, and with respect to a trust,the instrument establishing such trust; in each case including any and all modifications thereof asof the date of the Credit Document referring to such Organizational Document and any and all futuremodifications thereof which are consented to by the Lenders.

     Parties shall mean all Persons other than the Agent, the Syndication Agents, theDocumentation Agents or any Lender executing any Credit Document.

     Past Due Rate shall mean, on any day, a rate per annum equal to the Base Rate plus anadditional three percent (3%) per annum, but in any event not to exceed the Ceiling Rate.

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     Percentage shall mean the amount, expressed as a percentage, of each Lender Commitmentas compared to the Commitment, set forth opposite the Lender’s name on its signature page of thisAgreement, or as may hereafter become signatory hereto, as adjusted or amended in accordance withthis Agreement. If the Commitment has terminated or expired, the Percentage shall be determinedbased on the Revolving Credit Exposure most recently in effect, giving effect to any assignments.

     Permitted Encumbrances shall mean (a) encumbrances consisting of zoning restrictions,easements, or other restrictions on the use of Real Property, provided that such items do notmaterially impair the use of such property for the purposes intended and none of which is violatedin any material respect by existing or proposed structures or land use; (b) the following: (i)Liens for taxes not yet due and payable, or being diligently contested in good faith, or where noMaterial Adverse Effect could reasonably be expected to result from such nonpayment or theimposition of such Lien; or (ii) materialmen’s, mechanic’s, warehousemen’s and other like Liensarising in the ordinary course of business, securing payment of Indebtedness whose payment is notyet due, or that are being contested in good faith by appropriate proceedings diligently conducted,and for or against which the Borrower has established adequate reserves in accordance withGenerally Accepted Accounting Principles; (c) Liens for taxes, assessments and governmental chargesor assessments that are being contested in good faith by appropriate proceedings diligentlyconducted, and for or against which the Borrower has established adequate reserves in accordancewith Generally Accepted Accounting Principles; (d) Liens on Real Property which are insured aroundor against by title insurance; (e) Liens securing assessments or charges payable to a propertyowner association or similar entity which assessments are not yet due and payable or are beingdiligently contested in good faith; and (f) Liens securing this Agreement and Indebtednesshereunder.

     Person shall mean any individual, corporation, trust, unincorporated organization,Governmental Authority or any other form of entity.

     Pool shall have the meaning given to it in Section 5.15(a).

     Pool Value shall mean the Value of the Pool.

     Prime Rate shall mean, as of a particular date, the prime rate of interest per annumpublicly announced from time to time by JPMC as its prime rate in effect at its principal office inNew York, New York; each change in the Prime Rate shall be effective on the date such change isdetermined; which Prime Rate may not necessarily represent the Agent’s lowest or best rate actuallycharged to a customer.

     Proper Form shall mean in form and substance reasonably satisfactory to the Agent andthe Majority Lenders.

     Property shall mean any interest in any kind of property or asset, whether real,personal or mixed, tangible or intangible.

     QRS Entities shall mean Smith One, Inc., Smith Two, Inc., Smith Three, Inc., SmithFour, Inc., Smith Five, Inc., Smith Six, Inc. and Smith Seven, Inc.

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     Quarterly Unaudited Financial Statements shall mean the quarterly financial statementsof a Person, including all notes thereto, which statements shall include a balance sheet as of theend of such quarter and an income statement for such fiscal quarter, and for the fiscal year todate, a statement of cash flows for such quarter and for the fiscal year to date, subject to normalyear-end adjustments, and a detailed listing of the Borrower’s Property and the Historical Valuethereof, all setting forth in comparative form the corresponding figures for the correspondingfiscal period of the preceding year (or, in the case of the balance sheet, the end of the precedingfiscal year), prepared in accordance with Generally Accepted Accounting Principles except that theQuarterly Unaudited Financial Statements may contain condensed footnotes as permitted byregulations of the United States Securities and Exchange Commission, and certified as true andcorrect by a managing director, senior vice president, controller, co-controller or vice presidentof Borrower. The Quarterly Unaudited Financial Statements shall be prepared on a consolidatedbasis in accordance with Generally Accepted Accounting Principles.

     Rate Designation Date shall mean 1:00 p.m., New York, New York time, on the date three(3) Eurodollar Business Days preceding the first day of any proposed Interest Period.

     Real Property means, collectively, all interest in any land and improvements locatedthereon, together with all equipment, furniture, materials, supplies and personal property now orhereafter located at or used in connection with the land and all appurtenances, additions,improvements, renewals, substitutions and replacements thereof now or hereafter acquired by anyPerson.

     Regulation D shall mean Regulation D of the Board of Governors of the Federal ReserveSystem from time to time in effect and shall include any successor or other regulation relating toreserve requirements applicable to member lenders of the Federal Reserve System.

     Request for Loan shall mean a written request for a Committed Loan substantially inthe form of Exhibit B.

     Revolving Credit Exposure means, with respect to any Lender at any time, the sum ofthe outstanding principal amount of such Lender’s Loans, the Swing Loans, and its LC Exposure atsuch time.

     S&P Rating shall mean the senior unsecured debt rating from time to time received bythe Borrower from Standard & Poor’s Rating Services.

     Secured Debt means the Indebtedness of the Borrower or the Parent secured by a Lien,and any Indebtedness of any of the Borrower’s or the Parent’s Subsidiaries and UnconsolidatedAffiliates owed to a Person not an Affiliate of the Borrower or the Parent or such Subsidiary.

     Secured Debt to Total Asset Value Ratio means the ratio (expressed as a percentage) ofSecured Debt to Total Asset Value.

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     Stabilization Date shall mean, with respect to a property, the earlier of (a) eighteen(18) months from the date of acquisition of an income producing property by the Borrower oreighteen (18) months after substantial completion of construction or development of a newconstruction or development property, and (b) the date on which the Occupancy Level is at leastninety-three percent (93%).

     Stated Rate shall, on any day, mean whichever of the Base Rate, the Eurodollar Rate,or a rate applicable to Money Market Loans has been designated and provided pursuant to thisAgreement; provided that, if on any day such rate shall exceed the Ceiling Rate for that day, theStated Rate shall be fixed at the Ceiling Rate on that day and on each day thereafter until thetotal amount of interest accrued at the Stated Rate on the unpaid principal balance of the Notesequals the total amount of interest which would have accrued if there had been no Ceiling Rate. Ifthe Notes mature (or are prepaid) before such equality is achieved, then, in addition to the unpaidprincipal and accrued interest then owing pursuant to the other provisions of the Credit Documents,Borrower promises to pay on demand to the order of the holders of the Notes interest in an amountequal to the excess (if any) of (a) the lesser of (i) the total interest which would have accruedon the Notes if the Stated Rate had been defined as equal to the Ceiling Rate from time to time ineffect and (ii) the total interest which would have accrued on the Notes if the Stated Rate werenot so prohibited from exceeding the Ceiling Rate, over (b) the total interest actually accrued onthe Notes to such maturity (or prepayment) date.

     Subsidiary shall mean, as to a particular parent entity, any entity of which more thanfifty percent (50%) of the indicia of voting equity or ownership rights (whether outstandingcapital stock or otherwise) is at the time directly or indirectly owned by, such parent entity, orby one or more of its other Subsidiaries.

     Super-Majority Lenders shall mean the Lenders with an aggregate amount of sixty-sixand sixty-seven hundredths percent (66.67%) or more of the amount of the Commitment thenoutstanding, and after the Commitment has expired or terminated, shall mean Lenders with anaggregate amount of sixty-six and sixty-seven hundredths percent (66.67%) or more of the unpaidbalance of the Revolving Credit Exposures.

     Swing Loan shall mean a Loan made pursuant to Section 2.1(c) hereof.

     Swing Loan Note shall mean that certain promissory note dated of even date herewith inthe original principal amount of $100,000,000.00 executed by the Borrower payable to the order ofJPMC.

     Tangible Net Worth shall mean total assets (without deduction for accumulateddepreciation) less (1) all intangibles and (2) all liabilities (including contingent and indirectliabilities), all determined in accordance with Generally Accepted Accounting Principles. The term“intangibles” shall include, without limitation, (i) deferred charges, and (ii) the aggregate ofall amounts appearing on the assets side of any such balance sheet for franchises, licenses,permits, patents, patent applications, copyrights, trademarks, trade names, goodwill, treasurystock, experimental or organizational expenses and other like intangibles. The term “liabilities”shall include, without limitation, (i) Indebtedness

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secured by Liens on Property of the Person with respect to which Tangible Net Worth is beingcomputed whether or not such Person is liable for the payment thereof, (ii) deferred liabilities,and (iii) Capital Lease Obligations. Tangible Net Worth shall be calculated on a consolidatedbasis in accordance with Generally Accepted Accounting Principles.

     Taxes shall mean any tax, levy, impost, duty, charge or fee.

     Total Asset Value shall mean the sum of (without duplication) (a) the aggregate Valueof all of the Real Property owned by the Borrower and its Subsidiaries on a consolidated basis plus(b) the amount of the Borrower’s cash and cash equivalents, excluding tenant security and otherrestricted deposits, plus (c) the total book value of all of the Borrower’s other assets notdescribed in (a) or (b) above, excluding all intangibles and all equity investments inUnconsolidated Affiliates, plus (d) the Value of the Real Property, and cash and other assets ofthe type permitted, and as valued, in clauses (b) and (c) of this definition, ownedby each of the Borrower’s Unconsolidated Affiliates, multiplied by the Equity Percentage for thatUnconsolidated Affiliate, including gains on sales of assets to Unconsolidated Affiliates whichmust be deferred in accordance with Generally Accepted Accounting Principles. Total Asset Valueshall be calculated on a consolidated basis in accordance with Generally Accepted AccountingPrinciples.

     Unconsolidated Affiliate shall mean, in respect of any Person, any other Person thatis an Affiliate of such Person and in whom such Person holds a voting equity or other ownershipinterest and whose financial results would not be consolidated under Generally Accepted AccountingPrinciples with the financial results of such other Person on the consolidated financial statementsof such first mentioned Person.

     Unit Capital Expenditure shall mean, on an annual basis, an amount equal to the sum of(a) the result of (i) the number of apartment units contained in each completed, operating RealProperty owned by Borrower and any Subsidiary as of the last day of each of the immediatelypreceding four (4) calendar quarters, divided by four (4), and multiplied by (ii) $200.00; plus (b)for Unconsolidated Affiliates, the result of (i) the amount in clause (a) above forUnconsolidated Affiliates, multiplied by (ii) the Equity Percentage for each UnconsolidatedAffiliate.

     Value means the sum of the following:

     (a) for Real Property that has reached the Calculation Date and that the Person has owned forthe full determination period, the result of dividing (i) the aggregate Net Operating Income of thesubject property ((1) beginning with the Calculation Date until the end of the third full calendarquarter after the Stabilization Date, based on the annualized Net Operating Income from theCalculation Date until the time of measurement, and (2) beginning with the fourth full calendarquarter after the Stabilization Date, based on the immediately preceding four (4) calendar quarterperiod), by seven and one-half percent (7.5%); plus

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     (b) for Real Property that is completed but has not reached the Calculation Date or that hasnot been owned by Borrower for the full determination period, the Historical Value of the subjectproperty; plus

     (c) for Real Property that is under construction or development, or that is undeveloped land,the Historical Value of the subject property.

2. The Loans.

     2.1 Advances. (a) Subject to the terms and conditions of this Agreement, each Lenderseverally agrees to make Committed Loans (other than Swing Loans) prior to the Maturity Date to theBorrower not to exceed an amount (in the aggregate, the “Commitment”) at any one time outstandingequal to the difference between the Lender’s Lender Commitment and the Lender’s Revolving CreditExposure. Each such request for a Committed Loan by Borrower shall be deemed a request for aCommitted Loan from each Lender equal to such Lender’s Percentage of the aggregate amount sorequested, and such aggregate amount shall be in an amount at least equal to $1,000,000.00 andequal to a multiple of $100,000.00, or the difference between the Commitment and the aggregateRevolving Credit Exposures, whichever is less. Each repayment of the Committed Loans shall bedeemed a repayment of each Lender’s Committed Loan equal to such Lender’s Percentage of the amountso repaid. The obligations of the Lenders hereunder are several and not joint, and the precedingtwo sentences will give rise to certain inappropriate results if special provisions are not made toaccommodate the failure of a Lender to fund a Committed Loan as and when required by thisAgreement; therefore, notwithstanding anything herein to the contrary, (A) no Lender shall berequired to make Committed Loans at any one time outstanding in excess of such Lender’s Percentageof the Commitment, and (B) if a Lender fails to make a Committed Loan as and when requiredhereunder and Borrower subsequently makes a repayment on the Committed Loans, such repayment shallbe split among the non-defaulting Lenders ratably in accordance with their respective Percentagesuntil each Lender has its Percentage of all of the outstanding Committed Loans, and the balance ofsuch repayment shall be divided among all of the Lenders in accordance with their respectivePercentages. Notwithstanding the foregoing, borrowings and payments of Swing Loans shall be forJPMC’s own account. The Loans (other than Swing Loans) shall be evidenced by the Notessubstantially in the form of Exhibit C attached hereto. The Borrower, the Agent and theLenders agree that Chapter 346 of the Texas Finance Code shall not apply to this Agreement, theNotes or any Loan.

     (b) The Borrower shall give the Agent notice of each borrowing of a Committed Loan to be madehereunder as provided in Section 3.1, and the Agent shall deliver same to each Lenderpromptly thereafter. Not later than 12:00 noon, New York, New York time, on the date specified foreach such borrowing of a Committed Loan hereunder other than Swing Loans, each Lender shall makeavailable the amount of the Loan, if any, to be made by it on such date to the Agent at the Agent’sprincipal office in New York, New York, in immediately available funds, for the account of theBorrower. Such amounts received by the Agent will be held in Agent’s general ledger account. Theamounts so received by the Agent shall, subject to the terms and conditions of this Agreement, bemade available to the Borrower by wiring or otherwise transferring, in

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immediately available funds not later than 1:00 p.m., New York, New York time, such amount toan account designated by the Borrower and maintained with JPMC or any other account or accountswhich the Borrower may from time to time designate to the Agent by a written notice as the accountor accounts to which borrowings hereunder are to be wired or otherwise transferred. JPMC shallmake available the amount of each Swing Loan by depositing the same in immediately available funds,in the foregoing account by 3:00 p.m., New York, New York time, on the date of the borrowing.

     (c) Subject to the terms and conditions hereof, if necessary to meet the Borrower’s fundingdeadlines, JPMC agrees to make Swing Loans to the Borrower at any time on or prior to the MaturityDate, not to exceed an amount at any one time outstanding equal to the lesser of (i)$100,000,000.00, or (ii) the difference between the Commitment and the aggregate Revolving CreditExposures. Swing Loans shall constitute “Loans” for all purposes hereunder. Notwithstanding theforegoing, the aggregate amount of all Loans (including, without limitation, all Swing Loans) shallnot at any time exceed the difference between the Commitment and the LC Exposure. Each request fora Swing Loan shall be in an amount at least equal to $1,000,000.00 and equal to a multiple of$100,000.00. If necessary to meet the Borrower’s funding deadlines, the Agent may treat anyRequest for Loan as a request for a Swing Loan from JPMC and JPMC may fund it as a Swing Loan.Within two (2) Business Days after each Swing Loan is funded, JPMC shall request that each Lender,and each Lender shall, on the first Business Day after such request is made, purchase a portion ofany one or more Swing Loans in an amount equal to that Lender’s Percentage of such Swing Loans byfunding under such Lender’s Note, such purchase to be made in accordance with the terms ofSection 2.1(b) just as if the Lender were funding directly to the Borrower under its Note(such that all Lenders other than JPMC shall fund only under their respective Note and not underthe Swing Loan Note). Unless the Agent knew or should have known when JPMC funded a Swing Loanthat the Borrower had not satisfied the conditions in this Agreement to obtain a Loan, eachLender’s obligation to purchase an interest in the Swing Loans shall be absolute and unconditionaland shall not be affected by any circumstance, including, without limitation, (i) any set-off,counterclaim, recoupment, defense or other right which such Lender or any other Person may haveagainst JPMC or any other Person for any reason whatsoever; (ii) the occurrence or continuance of aDefault or Event of Default or the termination of any Lender Commitment; (iii) any adverse changein the condition (financial or otherwise) of the Borrower or any of its Subsidiaries; (iv) anybreach of this Agreement or any other Credit Documents by the Borrower, any of its Subsidiaries,the Agent or any other Lender; or (v) any other circumstance, happening or event whatsoever,whether or not similar to any of the foregoing. Any portion of a Swing Loan not so purchased andconverted may be treated by JPMC as a Committed Loan which was not funded by the non-purchasingLenders as contemplated in Section 2.1(a), and as a funding by JPMC under the Commitment inexcess of JPMC’s Percentage. Each Swing Loan, once so sold, shall cease to be a Swing Loan for thepurposes of this Agreement, but shall be a Committed Loan made under the Commitment and eachLender’s Lender Commitment. The Swing Loans shall be evidenced by the Swing Loan Notesubstantially in the form of Exhibit C-1 attached hereto.

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     (d) So long as the Borrower is not then in Default and so long as the Borrower has not reducedthe Commitment pursuant to Section 2.9, the Borrower may on two (2) occasions prior toDecember 13, 2007, request that the aggregate Commitment be increased, so long as (i) the aggregateCommitment does not exceed Nine Hundred Million Dollars ($900,000,000.00) (the “MaximumCommitment”), and (ii) each increase is a minimum of $50,000,000. If the Borrower requests thatthe aggregate Commitment be increased, the Agent shall use its best efforts to obtain increased oradditional commitments up to the Maximum Commitment, and to do so the Agent may obtain additionallenders of its choice (and approved by Borrower, such approval not to be unreasonably withheld ordelayed), and without the necessity of approval from any of the Lenders. The Borrower and eachGuarantor shall execute an amendment to this Agreement, additional Notes and other documents as theAgent may reasonably require to evidence the increase of the Commitment, and the admission ofadditional Persons as Lenders, if necessary.

     2.2 Letters of Credit.

          (a) Subject to the terms and conditions set forth herein, the Borrower may request theissuance of Letters of Credit for its own account, in a form reasonably acceptable to the Agent andthe Issuing Bank, at any time and from time to time before the Maturity Date. In the event of anyinconsistency between the terms and conditions of this Agreement and the terms and conditions ofany form of letter of credit application or other agreement submitted by the Borrower to, orentered into by the Borrower with, the Issuing Bank relating to any Letter of Credit, the terms andconditions of this Agreement shall control.

          (b) To request the issuance of a Letter of Credit (or the amendment, renewal or extension ofan outstanding Letter of Credit), the Borrower shall hand deliver or facsimile (or transmit byelectronic communication, if arrangements for doing so have been approved by the Issuing Bank) tothe Issuing Bank and the Agent (reasonably in advance of the requested date of issuance, amendment,renewal or extension) a notice requesting the issuance of a Letter of Credit, or identifying theLetter of Credit to be amended, renewed or extended, and specifying the date of issuance,amendment, renewal or extension (which shall be a Business Day), the date on which such Letter ofCredit is to expire (which shall comply with paragraph (c) of this Section), the amount of suchLetter of Credit, the name and address of the beneficiary thereof and such other information asshall be necessary to prepare, amend, renew or extend such Letter of Credit. If requested by theIssuing Bank, the Borrower also shall submit a letter of credit application on the Issuing Bank’sstandard form in connection with any request for a Letter of Credit. A Letter of Credit shall beissued, amended, renewed or extended only if (and upon issuance, amendment, renewal or extension ofeach Letter of Credit the Borrower shall be deemed to represent and warrant that), after givingeffect to such issuance, amendment, renewal or extension (i) the LC Exposure shall not exceed$150,000,000.00 and (ii) the total Revolving Credit Exposures shall not exceed the totalCommitment. Copies of all Letters of Credit and amendments, extensions and cancellations relatedthereto, must be delivered to the Agent and the other Lenders by the Issuing Bank.

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          (c) Each Letter of Credit shall expire not later than the earlier of (i) three (3) years afterdate of issuance of the Letter of Credit (the “Maximum Outside Date”), and (ii) the close ofbusiness on the date that is ten (10) days prior to the Maturity Date (including the extensionperiod provided in Section 9); provided, however, that Letters of Credit with an aggregate LCExposure not exceeding $50,000,000.00 at any time may expire up to the earlier of December 13, 2009and the Maximum Outside Date.

          (d) By the issuance of a Letter of Credit (or an amendment to a Letter of Credit increasingthe amount thereof) and without any further action on the part of the Issuing Bank or the Lenders,the Issuing Bank hereby grants to each Lender, and each Lender hereby acquires from the IssuingBank, a participation in such Letter of Credit equal to such Lender’s Percentage of the aggregateamount available to be drawn under such Letter of Credit. In consideration and in furtherance ofthe foregoing, each Lender hereby absolutely and unconditionally agrees to pay to the Agent, forthe account of the Issuing Bank, such Lender’s Percentage of each LC Disbursement made by theIssuing Bank and not reimbursed by the Borrower on the date due as provided in paragraph (e) ofthis Section, or of any reimbursement payment required to be refunded to the Borrower for anyreason. Each Lender acknowledges and agrees that its obligation to acquire participations pursuantto this paragraph in respect of Letters of Credit is absolute and unconditional and shall not beaffected by any circumstance whatsoever, including any amendment, renewal or extension of anyLetter of Credit or the occurrence and continuance of a Default or reduction of the Commitment, andthat each such payment shall be made without any offset, abatement, withholding or reductionwhatsoever.

          (e) If the Issuing Bank shall make any LC Disbursement in respect of a Letter of Credit, theBorrower shall reimburse such LC Disbursement by paying to the Agent an amount equal to such LCDisbursement not later than 1:00 p.m., New York, New York time, on the date that such LCDisbursement is made if the Borrower shall have received notice of such LC Disbursement prior to11:00 a.m., New York, New York time, on such date, or, if such notice has not been received by theBorrower prior to such time on such date, then not later than 1:00 p.m., New York, New York time,on (i) the Business Day that the Borrower receives such notice, if such notice is received prior to11:00 a.m., New York, New York time, on the day of receipt, or (ii) the Business Day immediatelyfollowing the day that the Borrower receives such notice, if such notice is not received prior tosuch time on the day of receipt; provided that the Borrower may, subject to the conditionsto borrowing set forth herein, request in accordance with Section 2.1 that such payment befinanced with a Base Rate Borrowing in an equivalent amount and, to the extent so financed, theBorrower’s obligation to make such payment shall be discharged and replaced by the resulting BaseRate Borrowing. If the Borrower fails to make such payment when due, the Agent shall notify eachLender of the applicable LC Disbursement, the payment then due from the Borrower in respect thereofand such Lender’s Percentage thereof. Promptly following receipt of such notice, each Lender shallpay to the Agent its Percentage of the payment then due from the Borrower, in the same manner asprovided in Section 2.1(a) with respect to Loans made by such Lender (and Section2.1(a) shall apply, mutatis mutandis, to the payment obligations of theLenders), and the Agent shall promptly pay to the Issuing Bank the amounts so received by it fromthe Lenders. Promptly following receipt by the Agent of any payment from the Borrower pursuant tothis

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paragraph, the Agent shall distribute such payment to the Issuing Bank or, to the extent thatLenders have made payments pursuant to this paragraph to reimburse the Issuing Bank, then to suchLenders and the Issuing Bank as their interests may appear. Any payment made by a Lender pursuantto this paragraph to reimburse the Issuing Bank for any LC Disbursement (other than the funding ofBase Rate Loans as contemplated above) shall not constitute a Loan and shall not relieve theBorrower of its obligation to reimburse such LC Disbursement.

          (f) The Borrower’s obligation to reimburse LC Disbursements as provided in paragraph (e) ofthis Section shall be absolute, unconditional and irrevocable, and shall be performed strictly inaccordance with the terms of this Agreement under any and all circumstances whatsoever andirrespective of (i) any lack of validity or enforceability of any Letter of Credit or thisAgreement, or any term or provision therein, (ii) any draft or other document presented under aLetter of Credit proving to be forged, fraudulent or invalid in any respect or any statementtherein being untrue or inaccurate in any respect, (iii) payment by the Issuing Bank under a Letterof Credit against presentation of a draft or other document that does not comply with the terms ofsuch Letter of Credit, or (iv) any other event or circumstance whatsoever, whether or not similarto any of the foregoing, that might, but for the provisions of this Section, constitute a legal orequitable discharge of, or provide a right of setoff against, the Borrower’s obligations hereunder.Neither the Agent, the Lenders nor the Issuing Bank shall have any liability or responsibility byreason of or in connection with the issuance or transfer of any Letter of Credit or any payment orfailure to make any payment thereunder (irrespective of any of the circumstances referred to in thepreceding sentence), or any error, omission, interruption, loss or delay in transmission ordelivery of any draft, notice or other communication under or relating to any Letter of Credit(including any document required to make a drawing thereunder), any error in interpretation oftechnical terms or any consequence arising from causes beyond the control of the Issuing Bank;provided that the foregoing shall not be construed to excuse the Issuing Bank fromliability to the Borrower to the extent of any direct damages (as opposed to consequential damages,claims in respect of which are hereby waived by the Borrower to the extent permitted by applicablelaw) suffered by the Borrower that are caused by the Issuing Bank’s failure to exercise care whendetermining whether drafts and other documents presented under a Letter of Credit comply with theterms thereof. The parties hereto expressly agree that, in the absence of gross negligence orwillful misconduct on the part of the Issuing Bank (as finally determined by a court of competentjurisdiction), the Issuing Bank shall be deemed to have exercised care in each such determination.In furtherance of the foregoing and without limiting the generality thereof, the parties agreethat, with respect to documents presented which appear on their face to be in substantialcompliance with the terms of a Letter of Credit, the Issuing Bank may, in its sole discretion,either accept and make payment upon such documents without responsibility for furtherinvestigation, regardless of any notice or information to the contrary, or refuse to accept andmake payment upon such documents if such documents are not in strict compliance with the terms ofsuch Letter of Credit.

          (g) The Issuing Bank shall, promptly following its receipt thereof, examine all documentspurporting to represent a demand for payment under a Letter of Credit. The Issuing Bank shallpromptly notify the Agent and the Borrower by telephone

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(confirmed by telecopy) of such demand for payment and whether the Issuing Bank has made orwill make an LC Disbursement thereunder; provided that any failure to give or delay ingiving such notice shall not relieve the Borrower of its obligation to reimburse the Issuing Bankand the Lenders with respect to any such LC Disbursement.

          (h) If the Issuing Bank shall make any LC Disbursement, then, unless the Borrower shallreimburse such LC Disbursement in full on the date such LC Disbursement is made, the unpaid amountthereof shall bear interest, for each day from and including the date such LC Disbursement is madeto but excluding the date that the Borrower reimburses such LC Disbursement, at the rate per annumthen applicable to Base Rate Loans; provided that, if the Borrower fails to reimburse suchLC Disbursement when due pursuant to paragraph (e) of this Section, then the unpaid amountthereof shall bear interest from the date reimbursement was due until the date payment is made atthe Past Due Rate. Interest accrued pursuant to this paragraph shall be for the account of theIssuing Bank, except that interest accrued on and after the date of payment by any Lender pursuantto paragraph (e) of this Section to reimburse the Issuing Bank shall be for the account of suchLender to the extent of such payment.

          (i) The Issuing Bank may be replaced at any time by written agreement among the Borrower, theAgent, the replaced Issuing Bank and the successor Issuing Bank. The Agent shall notify theLenders of any such replacement of the Issuing Bank. At the time any such replacement shall becomeeffective, the Borrower shall pay all unpaid fees accrued for the account of the replaced IssuingBank pursuant to Section 2.7(c). From and after the effective date of any suchreplacement, (i) the successor Issuing Bank shall have all the rights and obligations of theIssuing Bank under this Agreement with respect to Letters of Credit to be issued thereafter and(ii) references herein to the term “Issuing Bank” shall be deemed to refer to such successor or toany previous Issuing Bank, or to such successor and all previous Issuing Banks, as the contextshall require. After the replacement of an Issuing Bank hereunder, the replaced Issuing Bank shallremain a party hereto and shall continue to have all the rights and obligations of an Issuing Bankunder this Agreement with respect to Letters of Credit issued by it prior to such replacement, butshall not be required to issue additional Letters of Credit.

          (j) If (i) any Event of Default shall occur and be continuing, on the Business Day that theBorrower receives notice from the Agent or the Majority Lenders demanding the deposit of cashcollateral pursuant to this paragraph, or (ii) any Letter of Credit will expire after the MaturityDate as allowed by Section 2.2(c) then at least ten (10) days before the Maturity Date, theBorrower shall deposit in an account with the Agent, in the name of the Agent and for the benefitof the Lenders, an amount in cash equal to the LC Exposure as of such date plus any accrued andunpaid interest thereon; provided that the obligation to deposit such cash collateral shallbecome effective immediately, and such deposit shall become immediately due and payable, withoutdemand or other notice of any kind, upon the occurrence of any Event of Default with respect to theBorrower described in clause (h) or (i) of Section 7.1. Such depositshall be held by the Agent as collateral for the payment and performance of the obligations of theBorrower under this Agreement. The Agent shall have exclusive dominion and control, including theexclusive right of withdrawal, over such account. Other than any interest earned on the investmentof such

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deposits, which investments shall be made at the option and sole discretion of the Agent andat the Borrower’s risk and expense, such deposits shall not bear interest. Interest or profits, ifany, on such investments shall accumulate in such account. Moneys in such account shall be appliedby the Agent to reimburse the Issuing Bank for LC Disbursements for which it has not beenreimbursed and, to the extent not so applied, shall be held for the satisfaction of thereimbursement obligations of the Borrower for the LC Exposure at such time or, if the maturity ofthe Loans has been accelerated, be applied to satisfy other obligations of the Borrower under thisAgreement. If the Borrower is required to provide an amount of cash collateral hereunder as aresult of the occurrence of an Event of Default, such amount (to the extent not applied asaforesaid) shall be returned to the Borrower within three Business Days after all Events of Defaulthave been cured or waived.

     2.3 Payments.

          (a) Except to the extent otherwise provided herein, all payments of principal, interest andother amounts to be made by the Borrower hereunder, under the Notes and under the other CreditDocuments shall be made in immediately available funds to the Agent at its principal office in NewYork, New York (or in the case of a successor Agent, at the principal office of such successorAgent in the United States), not later than 1:00 p.m., New York, New York time on the date on whichsuch payment shall become due (each such payment made after such time on such due date to be deemedto have been made on the next succeeding Business Day).

          (b) The Borrower may, at the time of making each payment hereunder, under any Note or underany other Credit Document, specify to the Agent the Loans or other amounts payable by the Borrowerhereunder or thereunder to which such payment is to be applied (and in the event that it fails soto specify, such payment shall be applied to the Loans (first to the Swing Loans) or, if no Loansare outstanding, to other amounts then due and payable, provided that if no Loans or other amountsare then due and payable or an Event of Default has occurred and is continuing, the Agent may applysuch payment to the Obligations in such order as it may elect in its sole discretion, but subjectto the other terms and conditions of this Agreement, including without limitation Section2.4 hereof). Each payment received by the Agent hereunder, under any Note or under any otherCredit Document for the account of a Lender shall be paid promptly to such Lender, in immediatelyavailable funds. If the Agent receives a payment for the account of a Lender prior to 1:00 p.m.,New York, New York time, such payment must be delivered to the Lender on that same day and if it isnot so delivered due to the fault of the Agent, the Agent shall pay to the Lender entitled to thepayment the interest accrued on the amount of the payment pursuant to said Lender’s Note from thedate the Agent receives the payment to the date the Lender received the payment. The Agent mayapply payments received from the Borrower to pay any unpaid principal and interest on the SwingLoans before making payment to each Lender of amounts due under the Notes other than the Swing LoanNote. Loans may be prepaid only if the accompanying Funding Loss, if any, is also paid.

          (c) If the due date of any payment hereunder or under any Note falls on a day which is not aBusiness Day or a Eurodollar Business Day, as the case may be, the due date for such payments shallbe extended to the next succeeding Business Day or

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Eurodollar Business Day, respectively, and interest shall be payable for any principal soextended for the period of such extension; provided, however, that with respect to Eurodollar RateBorrowings and Money Market LIBOR Loans if such extension would cause the Eurodollar Business Dayof payment to fall in another calendar month, the payment shall be due on the Eurodollar BusinessDay next preceding the due date of the payment.

          (d) The Borrower shall give the Agent at least one (1) Business Day’s prior written notice ofthe Borrower’s intent to make any payment of principal or interest under the Credit Documents notscheduled to be paid under the Credit Documents. Any such notification of payment shall beirrevocable after it is made by the Borrower. Upon receipt by the Agent of such notification ofpayment, it shall deliver same to the other Lenders.

          (e) All payments by the Borrower hereunder or under any other Credit Documents shall be madefree and clear of and without deduction for or on account of any Taxes, including withholding andother charges of any nature whatsoever imposed by any taxing authority excluding in the case ofeach Lender taxes imposed on or measured by its net income or franchise taxes imposed in lieu ofnet income taxes by the jurisdiction in which it is organized or through which it acts for purposesof this Agreement. If any withholding or deduction from any payment to be made to, or for theaccount of, a Lender by the Borrower hereunder or under any other Credit Document is required inrespect of any Taxes pursuant to any applicable law, rule, or regulation, then the Borrower will(i) pay to the relevant authority the full amount required to be so withheld or deducted; (ii) tothe extent available, promptly forward to the Agent an official receipt or other documentationsatisfactory to the Agent evidencing such payment to such authority; and (iii) pay to the Agent,for the account of each affected Lender, such additional amount or amounts as are necessary toensure that the net amount actually received by such Lender will equal the full amount such Lenderwould have received had no such withholding or deduction been required. Each Lender shalldetermine such additional amount or amounts payable to it (which determination shall, in theabsence of manifest error, be conclusive and binding on the Borrower). If a Lender becomes awarethat any such withholding or deduction from any payment to be made by the Borrower hereunder orunder any other Credit Document is required, then such Lender shall promptly notify the Agent andthe Borrower thereof stating the reasons therefor and the additional amount required to be paidunder this Section. Each Lender shall execute and deliver to the Agent and Borrower such forms asit may be required to execute and deliver pursuant to subsection (f) below. To the extentthat any such withholding or deduction results from the failure of a Lender to provide a formrequired by subsection (f) below (unless such failure is due to some prohibition underapplicable Legal Requirements), the Borrower shall have no obligation to pay the additional amountrequired by clause (iii) above. Anything in this Section notwithstanding, if any Lenderelects to require payment by the Borrower of any material amount under this Section, the Borrowermay, within 60 days after the date of receiving notice thereof and so long as no Default shall haveoccurred and be continuing, elect to terminate such Lender as a party to this Agreement; providedthat, concurrently with such termination the Borrower shall (1) if the Agent and each of the otherLenders shall consent, pay that Lender all principal, interest and fees and other amounts owed tosuch Lender through such date of

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termination or (2) have arranged for another institution approved by the Agent (such approvalnot to be unreasonably withheld) as of such date, to become a substitute Lender for all purposesunder this Agreement in the manner provided in Section 10.5; provided further that, priorto substitution for any Lender, the Borrower shall have given written notice to the Agent of suchintention and the Lenders shall have the option, but no obligation, for a period of 60 days afterreceipt of such notice, to increase their Commitments pro rata based on their Lender Commitments inorder to replace the affected Lender in lieu of such substitution.

          (f) With respect to each Lender which is organized under the laws of a jurisdiction outsidethe United States, on the day of the initial borrowing from each such Lender hereunder and fromtime to time thereafter if requested by the Borrower or the Agent, such Lender shall provide theAgent and the Borrower with the forms prescribed by the Internal Revenue Service of the UnitedStates certifying as to such Lender’s status for purposes of determining exemption from UnitedStates withholding taxes with respect to all payments to be made to such Lender hereunder or otherdocuments satisfactory to such Lender and the Agent indicating that all payments to be made to suchLender hereunder are not subject to United States withholding tax or are subject to such tax at arate reduced by an applicable tax treaty. Unless the Borrower and the Agent shall have receivedsuch forms or such documents indicating that payments hereunder are not subject to United Stateswithholding tax or are subject to such tax at a rate reduced by an applicable tax treaty, theBorrower or the Agent shall withhold taxes from such payments at the applicable statutory rate inthe case of payments to or for any Lender organized under the laws of a jurisdiction outside theUnited States.

     2.4 Pro Rata Treatment. Except to the extent otherwise provided herein: (a) eachborrowing from the Lenders under Section 2.1(a) hereof shall be made ratably from theLenders on the basis of their respective Percentages, except as provided in Section2.7(c)(ii) each payment of the Fee (hereinafter defined) shall be made for the account of theLenders, and shall be applied, pro rata, according to the Lenders’ respective Lender Commitment;and (b) each payment by the Borrower of principal or interest on the Committed Loans other than theSwing Loans, of any other sums advanced by the Lenders pursuant to the Credit Documents, and of anyother amount owed to the Lenders other than the Fee, payments of Swing Loans, or any other sumsdesignated by this Agreement as being owed to a particular Lender, shall be made to the Agent forthe account of the Lenders pro rata in accordance with the respective unpaid principal amounts ofthe Committed Loans (other than Swing Loans) held by the Lenders. Payments of Swing Loans shall befor JPMC’s own account.

     2.5 Non-Receipt of Funds by the Agent. Unless the Agent shall have been notified by aLender or the Borrower (the “Payor”) prior to the date on which such Lender is to make payment tothe Agent of the proceeds of a Loan (or purchase of a portion of a Swing Loan) to be made by ithereunder or the Borrower is to make a payment to the Agent for the account of one or more of theLenders, as the case may be (such payment being herein called the “Required Payment”), which noticeshall be effective upon receipt, that the Payor does not intend to make the Required Payment to theAgent, the Agent may assume that the Required Payment has been made and may, in reliance upon such

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assumption (but shall not be required to), make the amount thereof available to the intendedrecipient on such date and, if the Payor has not in fact made the Required Payment to the Agent,the recipient of such payment shall, on demand, pay to the Agent the amount made available by theAgent together with interest thereon in respect of the period commencing on the date such amountwas so made available by the Agent until the date the Agent recovers such amount at a rate perannum equal to (a) the Past Due Rate for such period if the recipient returning a Required Paymentis the Borrower, or (b) the Federal Funds Effective Rate for such period if the recipient returninga Required Payment is the Agent or a Lender.

     2.6 Sharing of Payments, Etc. The Borrower agrees that, in addition to (and withoutlimitation of) any right of set-off, bankers’ lien or counterclaim a Lender may otherwise have,each Lender shall be entitled, at its option, to offset balances held by it for the account of theBorrower at any of its offices, against any principal of or interest on any of such Lender’s Loansto the Borrower hereunder, or other Obligations of the Borrower hereunder, which is not paid(regardless of whether such balances are then due to the Borrower), in which case it shall promptlynotify the Borrower and the Agent thereof, provided that such Lender’s failure to give such noticeshall not affect the validity thereof. If a Lender shall obtain payment of any principal of orinterest on any Committed Loan made by it under this Agreement (other than Swing Loans made byJPMC), or other Obligation then due to such Lender hereunder, through the exercise of any right ofset-off, banker’s lien, counterclaim or similar right, or otherwise, it shall promptly purchasefrom the other Lenders portions of the Loans made or other Obligations held (other than Swing Loansmade by JPMC), by the other Lenders in such amounts, and make such other adjustments from time totime as shall be equitable to the end that all the Lenders shall share the benefit of such payment(net of any expenses which may be incurred by such Lender in obtaining or preserving such benefit)pro rata in accordance with the unpaid principal and interest on the Obligations then due to eachof them. To such end all the Lenders shall make appropriate adjustments among themselves (by theresale of participations sold or otherwise) if such payment is rescinded or must otherwise berestored. Nothing contained herein shall require any Lender to exercise any such right or shallaffect the right of any Lender to exercise, and retain the benefits of exercising, any such rightwith respect to any other indebtedness or obligation of the Borrower.

     2.7 Fees. The Borrower shall pay fees equal to the following:

          (a) An amount payable as a facility fee by the Borrower to the Agent for the account of eachLender equal to the following percentage per annum multiplied by the Commitment (and after theCommitment terminates or expires, the aggregate Revolving Credit Exposures), which will be ineffect whenever and for so long as the Borrower has received the corresponding Credit Rating (themethod of determining the Credit Rating based on multiple ratings to be the same as set forth andused to determine the Credit Rating for the definition of Applicable Margin):

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CREDIT RATING   FACILITY FEE
A/A2 or better
    0.125 %
A-/A3
    0.150 %
BBB+/Baa1
    0.150 %
BBB/Baa2
    0.150 %
BBB-/Baa3
    0.200 %

If the Credit Rating is worse than BBB-/Baa3, or if there is no Credit Rating, then for thatcalendar quarter and for so long thereafter as the Credit Rating is worse than BBB-/Baa3 or ifthere is no Credit Rating, the facility fee will be equal to the daily unused amount of theCommitment (Swing Loans shall be deemed to be a utilization of the Commitment solely for thepurposes of this Section 2.7(a)) multiplied by 0.250% per annum. The facility fee ispayable in arrears on or before the tenth (10th) day of each January, April, July and October priorto termination or expiration of the Commitment, and on demand thereafter.

          (b) If the Maturity Date is extended pursuant to Section 9 of this Agreement, anamount payable as an extension fee by the Borrower to the Agent for the account of each Lenderequal to 0.150% of each Lender’s Lender Commitment at that time payable on the first day of theextension.

          (c) (i) to the Agent for the account of each Lender a participation fee with respect to itsparticipations in Letters of Credit, which shall accrue at the Applicable Margin provided forEurodollar Rate Borrowings on the average daily amount of the LC Exposure (excluding any portionthereof attributable to unreimbursed LC Disbursements) during the period from and including thedate of this Agreement to but excluding the later of the date of termination of the Commitment andthe date on which there ceases to be any LC Exposure, and (ii) to the Issuing Bank a nonrefundablefronting fee which shall accrue at the rate of 0.100% per annum on the face amount of each Letterof Credit, as well as the Issuing Bank’s standard fees (not to be less than $1,500.00 pertransaction) with respect to the issuance, amendment, renewal or extension of any Letter of Creditor processing of drawings thereunder. Participation fees and fronting fees accrued through andincluding the last day of March, June, September and December of each year shall be payable on thetenth (10th) day following such last day, commencing on the first such date to occurafter the date of this Agreement; provided that all such fees shall be payable on the dateon which the Commitment terminates and any such fees accruing after the date on which theCommitment terminates shall be payable on demand. Any other fees payable to the Issuing Bankpursuant to this paragraph shall be payable within ten (10) days after demand. All participationfees and fronting fees shall be computed on the basis of a year of 360 days and shall be payablefor the actual number of days elapsed (including the first day but excluding the last day).

     The Fee shall not be refundable (except as required by Section 3.1(c) of thisAgreement). Any portion of the Fee which is not paid by the Borrower when due shall bear interestat the Past Due Rate from the date due until the date paid by the Borrower. The Fee shall becalculated on the actual number of days elapsed in a year deemed to consist of 360 days.

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     2.8 Money Market Borrowings.

          (a) The Borrower may, as set forth in this Section, whenever at the time of the requesttherefor the Borrower has received an Acceptable Credit Rating, request the Lenders prior to theMaturity Date to make offers to make Money Market Loans to the Borrower, not to exceed, at suchtime, the lesser of (i) the difference between the Commitment and the aggregate Revolving CreditExposures, and (ii) fifty percent (50%) of the Commitment. The Lenders may, but shall have noobligation to, make such offers and the Borrower may, but shall have no obligation to, accept anysuch offers in the manner set forth in this Section. The Borrower shall pay the Agent a fee of$2,000.00 for each Money Market Quote Request provided below, payable monthly based on the requestsfor the previous month.

          (b) When the Borrower wishes to request offers to make Money Market Loans under this Section,it shall transmit to the Agent (in care of Ms. Angelica M. Castillo, Loan and Agency Services, 1111Fannin, Houston, Texas 77002, Facsimile No. 713-750-2228, telephone number 713-750-2513) byfacsimile transmission a Money Market Quote Request (“Money Market Quote Request”) substantially inthe form of Exhibit E hereto so as to be received no later than 12:00 noon, New York, NewYork time on (i) the fourth Eurodollar Business Day prior to the date of borrowing proposedtherein, in the case of a LIBOR Auction or (ii) the Business Day next preceding the date ofborrowing proposed therein, in the case of an Absolute Rate Auction (or, in either case, such othertime or date as the Borrower and the Agent shall have mutually agreed and shall have notified tothe Lenders not later than the date of the Money Market Quote Request for the first LIBOR Auctionor Absolute Rate Auction for which such change is to be effective) specifying:

                  (x) the proposed date of borrowing, which shall be aEurodollar Business Day in the case of a LIBOR Auction or aBusiness Day in the case of an Absolute Rate Auction, and

                  (y) the aggregate amount of such borrowing, which shall be$20,000,000.00 or a larger multiple of $1,000,000.00.

The Borrower may request offers to make Money Market Loans for more than one Interest Period in asingle Money Market Quote Request. No Money Market Quote Request shall be given within five (5)Eurodollar Business Days (or such other number of days as the Borrower and the Agent may agree inwriting ) of any other Money Market Quote Request.

          (c) Promptly upon receipt of a Money Market Quote Request, the Agent shall send to the Lendersby telex or facsimile transmission an Invitation for Money Market Quotes substantially in the formof Exhibit F hereto, which shall constitute an invitation by the Borrower to each Lender tosubmit Money Market Quotes offering to make the Money Market Loans to which such Money Market QuoteRequest relates in accordance with this Section.

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          (d) (i) Each Lender may submit a Money Market Quote containing an offer or offers to makeMoney Market Loans in response to any Invitation for Money Market Quotes. Each Money Market Quotemust comply with the requirements of this subsection (d) and must be received by the Agentby telex or facsimile transmission not later than (x) 9:30 a.m. New York, New York time on thethird Eurodollar Business Day prior to the proposed date of borrowing, in the case of a LIBORAuction or (y) 9:30 a.m. New York, New York time on the proposed date of borrowing, in the case ofan Absolute Rate Auction; provided that Money Market Quotes submitted by the Agent (or anyaffiliate of the Agent or its Designated Lender) in the capacity of a Lender may be submitted, andmay only be submitted, if the Agent or such affiliate notifies the Borrower of the terms of theoffer or offers contained therein not later than thirty (30) minutes prior to the applicabledeadline for the other Lenders. Any Money Market Quote so made shall be irrevocable except withthe written consent of the Agent given on the instructions of the Borrower. If, and only if, theBorrower elected in the applicable Money Market Quote Request to permit the Lenders to designateDesignated Lenders to fund such Money Market Loans, such Money Market Loans may be funded by suchLender’s Designated Lender (if any) as provided in Section 10.5(f), however such Lendershall not be required to specify in its Money Market Quote whether such Money Market Loans will befunded by such Designated Lender.

          (ii) Each Money Market Quote shall be in substantially the form of Exhibit G heretoand shall in any case specify:

               (1) the principal amount of the Money Market Loan for which each offer is being made,which principal amount (w) may be greater than or less than the Lender Commitment of thequoting Lender, (x) must be $5,000,000.00 or a larger multiple of $500,000.00, (y) may notexceed the principal amount of Money Market Loans for which offers were requested, and (z)may be subject to an aggregate limitation as to the principal amount of Money Market Loansfor which offers being made by such quoting Lender may be accepted,

               (2) in the case of a LIBOR Auction, the margin (the “Money Market Margin”) above orbelow the applicable Eurodollar Interbank Rate ) offered for each such Money Market Loan,expressed as a percentage (specified to the nearest 1/10,000th of 1%) to be added to orsubtracted from such applicable rate, and

               (3) in the case of an Absolute Rate Auction, the rate of interest per annum (specifiedto the nearest 1/10,000th of 1%) (the “Money Market Absolute Rate”) offered for each suchMoney Market Loan.

A Money Market Quote may set forth up to five (5) separate offers by the quoting Lender withrespect to each Interest Period specified in the related Invitation for Money Market Quotes.

          (iii) Any Money Market Quote shall be disregarded if it:

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               (1) is not substantially in conformity with Exhibit G hereto or does notspecify all of the information required by subsection (d)(ii) above;

               (2) contains qualifying, conditional or similar language;

               (3) proposes terms other than or in addition to those set forth in the applicableInvitation for Money Market Quotes; or

               (4) arrives after the time set forth in subsection (d)(i) above.

          (e) The Agent shall promptly notify the Borrower (i) of the terms of each proper Money MarketQuote and the identity of the Lender submitting such Money Market Quote, and (ii) of any MoneyMarket Quote that amends, modifies or is otherwise inconsistent with a previous Money Market Quotesubmitted by such Lender with respect to the same Money Market Quote Request. Any such subsequentMoney Market Quote shall be disregarded by the Agent unless such subsequent Money Market Quote issubmitted solely to correct a manifest error in such former Money Market Quote. The Agent’s noticeto the Borrower shall specify (1) the aggregate principal amount of Money Market Loans for whichoffers have been received for each Interest Period specified in the related Money Market QuoteRequest, (2) the respective principal amounts and Money Market Margins or Money Market AbsoluteRates, as the case may be, so offered, and (3) if applicable, limitations on the aggregateprincipal amount of Money Market Loans for which offers in any single Money Market Quote may beaccepted.

          (f) Not later than 10:30 a.m. New York, New York time on (i) the third Eurodollar Business Dayprior to the proposed date of borrowing, in the case of a LIBOR Auction, or (ii) the proposed dateof borrowing, in the case of an Absolute Rate Auction, the Borrower shall notify the Agent of itsacceptance or non-acceptance of the offers so notified to it pursuant to subsection (e)above. In the case of acceptance, such notice (a “Notice of Money Market Borrowing”) shall specifythe aggregate principal amount of offers for each Interest Period that are accepted. The Borrowermay accept any Money Market Quote in whole or in part; provided that:

               (1) the aggregate principal amount of each borrowing may not exceed the applicableamount set forth in the related Money Market Quote Request;

               (2) the principal amount of each borrowing must be $5,000,000.00 or a larger multipleof $500,000.00;

               (3) acceptance of offers may only be made on the basis of ascending Money MarketMargins or Money Market Absolute Rates, as the case may be; and

               (4) the Borrower may not accept any offer that is described in subsection(d)(iii) above or that otherwise fails to comply with the requirements of thisAgreement.

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          (g) If offers are made by two or more Lenders with the same Money Market Margins or MoneyMarket Absolute Rates, as the case may be, for a greater aggregate principal amount than the amountin respect of which such offers are accepted for the related Interest Period, the principal amountof Money Market Loans in respect of which such offers are accepted shall be allocated by the Agentamong such Lenders as nearly as possible (in multiples of $500,000.00, as the Agent may deemappropriate) in proportion to the aggregate principal amounts of such offers. The Agent shallpromptly (and in any event within one (1) Business Day after such offers are accepted) notify theBorrower and each such Lender in writing of any such allocation of Money Market Loans.Determinations by the Agent of the allocation of Money Market Loans shall be conclusive in theabsence of manifest error.

          (h) Upon receipt of the Borrower’s Notice of Money Market Borrowing, the Agent shall, on thedate such Notice of Money Market Borrowing is received by the Agent, promptly notify each Lender ofthe principal amount of the Money Market Loans accepted by the Borrower and of such Lender’s share(if any) of such Money Market Loans and such Notice of Money Market Borrowing shall not thereafterbe revocable by the Borrower. Any Lender so notified shall fund such Money Market Loans at thetimes provided in Section 2.1(b). A Lender that is notified that it has been selected tomake a Money Market Loan may designate its Designated Lender (if any) to fund such Money MarketLoan on its behalf, as described in Section 10.5(f). Any Designated Lender which funds aMoney Market Loan shall on and after the time of such funding become the obligee under such MoneyMarket Loan and be entitled to receive payment thereof when due. No Lender shall be relieved ofits obligation to fund a Money Market Loan, and no Designated Lender shall assume such obligation,prior to the time the applicable Money Market Loan is funded. Money Market Loans shall beevidenced by a promissory note in the form of Exhibit C-2 attached hereto.

          (i) Notwithstanding anything to the contrary contained herein, each Lender shall be requiredto fund its Percentage of each Committed Loan in accordance with Section 2.1 despite thefact that any Lender’s Lender Commitment may have been or may be exceeded as a result of suchLender’s making of Money Market Loans.

          (j) Each Money Market LIBOR Loan shall bear interest on the outstanding principal amountthereof, for the Interest Period applicable thereto, at a rate per annum equal to the sum of theEurodollar Interbank Rate for such Interest Period plus (or minus) the Money Market Margin quotedby the Lender making such Loan in accordance with Section 2.8. Each Money Market AbsoluteRate Loan shall bear interest on the outstanding principal amount thereof, for the Interest Periodapplicable thereto, at a rate per annum equal to the Money Market Absolute Rate quoted by theLender making such Loan in accordance with Section 2.8. Such interest shall be payable oneach Interest Payment Date. Each Money Market Loan shall mature at the end of each InterestPeriod, as specified in the Money Market Quote.

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     2.9 Reduction of Commitment.

          (a) Unless previously terminated, the Commitment shall terminate on the Maturity Date.

          (b) The Borrower may on three (3) occasions reduce the Commitment; provided that (i)each reduction in the Commitment shall be a minimum of $50,000,000, (ii) the total Commitment maynot be reduced to less than $200,000,000, (iii) after any reduction in the Commitment, theBorrower’s option to increase the Commitment provided in Section 2.1(d) shall terminate,and (iv) no reduction in the Commitment will be allowed if a Default is then in existence.

          (c) The Borrower shall notify the Agent of any election to reduce the Commitment underSection 2.9(b) at least three (3) Business Days prior to the effective date of suchreduction, specifying such election and the effective date thereof. Promptly following receipt ofany notice, the Agent shall advise the Lenders of the contents thereof. Each notice deliveredpursuant to this Section shall be irrevocable. Any reduction of the Commitment shall be permanent.Each reduction in the Commitment shall be made ratably among the Lenders in accordance with theirrespective Lender Commitments.

     2.10 Additional Guarantees. From time to time, certain of the direct or indirectowners of legal interests in the Borrower may request to guarantee collection of the unpaid balanceof the Loans remaining after application of other recoveries against the Loans by theAdministrative Agent and the Lenders. If the Borrower notifies the Administrative Agent of such aguarantee request and (a) supplies the Administrative Agent with the Organizational Documents ofthe proposed guarantor and any other information regarding the proposed guarantor as reasonablyrequested by the Administrative Agent or any of the Lenders, including any information that theAdministrative Agent is required to obtain for any guarantor pursuant to applicable LegalRequirements, and (b) so long as the acceptance of the guarantee from the proposed guarantor doesnot violate any Legal Requirement applicable to the Administrative Agent or any of the Lenders, theAdministrative Agent agrees, on behalf of the Lenders, to accept a guarantee from such proposedguarantor in the form attached hereto as Exhibit K.

3. Conditions.

     3.1 All Loans. The obligation of any Lender to make any Loan, or to issue, renew orextend any Letter of Credit, is subject to the accuracy of all representations and warranties ofthe Borrower on the date of such Loan, or issuance, renewal or extension of such Letter of Credit,to the performance by the Borrower of its obligations under the Credit Documents and to thesatisfaction of the following further conditions: (a) the Agent shall have received the following,all of which shall be duly executed and in Proper Form: (1) for Committed Loans, a Request for Loan(i) by 12:00 noon, New York, New York time, one (1) Business Day before the date (which shall alsobe a Business Day) of the proposed Loan which is to be a Base Rate Borrowing (other than SwingLoans or Base Rate Borrowings to finance the reimbursement of an LC Disbursement as contemplated bySection 2.2(e) hereof), (ii) by 12:00 noon, New York, New York time, on the same

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Business Day of any proposed Swing Loan or Base Rate Borrowing to finance the reimbursement ofan LC Disbursement as contemplated by Section 2.2(e) hereof, provided that by 12:00 noon,New York, New York time on the date of the proposed Loan, Borrower shall also have notified JPMC bytelephone of its request for a Loan, or (iii) by the Rate Designation Date of the proposed Loanwhich is to be a Eurodollar Rate Borrowing; (2) for Money Market Loans the information required bySection 2.8; (3) for Letters of Credit the documents required by Section 2.2hereof; and (4) such other documents as the Agent may reasonably require to satisfy itself or therequest of any Lender; (b) no Default or Event of Default shall have occurred and be continuing;(c) the making of the Loan or issuance, renewal or extension of such Letter of Credit, shall not beprohibited by any Legal Requirement (in which event the applicable portion of the Fee will not becharged to the Borrower); (d) the Borrower shall have paid all legal fees and expenses of the typedescribed in Section 5.10 hereof through the date of such Loan; (e) in the case of aCommitted Loan other than a Swing Loan, all Swing Loans then outstanding shall have been paid orshall be paid with the proceeds of such Loan and (f) the Agent shall have received an Officer’sCertificate certifying the information set forth therein as of the end of the immediately precedingfiscal quarter.

     3.2 First Loan. In addition to the matters described in Section 3.1 hereof,the obligation of the Lenders to make the first Loan under this Agreement is subject to the receiptby the Lenders of each of the following, in Proper Form: (a) the Notes, executed by the Borrower;(b) a separate certificate executed by each of the Secretary of the Borrower and the Secretary ofthe Parent dated as of the date hereof; (c) a separate certificate from the Secretary of State orother appropriate public official of Maryland as to the continued existence and good standing ofeach of the Parent and the Borrower; (d) a separate certificate from the appropriate publicofficial of Maryland as to the due qualification and good standing of each of the Parent and theBorrower; (e) a legal opinion from independent counsel for the Parent, the Borrower and theGuarantors as to the matters set forth on Exhibit D acceptable to the Lenders; (f) policiesof insurance addressed to the Agent reflecting the insurance required by Section 5.7hereof; (g) an Officer’s Certificate in the form of Exhibit A as of the end of theimmediately preceding fiscal quarter; (h) a certificate from Borrower and Parent setting forth thepro forma calculations of Secured Debt to Total Asset Value Ratio, Coverage Ratio, Fixed ChargeCoverage Ratio, Tangible Net Worth, Debt to Total Asset Value Ratio, and the Pool pursuant toSection 5.15 (which include actual figures as of September 30, 2004; and (i) any Guarantyrequired by Section 5.15 together with such Guarantors’ organizational documents andcertificates of existence and good standing from the state of its organization; and to the furthercondition that, at the time of the initial Loan, all legal matters incident to the transactionsherein contemplated shall be satisfactory to Locke Liddell & Sapp LLP, counsel for the Agent.

     3.3 Options Available. The outstanding principal balance of the Notes shall bearinterest at the Base Rate; provided, that (1) all past due amounts, both principal and accruedinterest, shall bear interest at the Past Due Rate, and (2) subject to the provisions hereof,Borrower shall have the option of having all or any portion of the principal balance of the Notes,other than the Swing Loan Note, from time to time outstanding bear interest at a Eurodollar Rate.The records of the Lenders with respect to Interest Options, Interest Periods and the amounts ofLoans to which they are applicable shall be prima facie

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evidence thereof. Interest on the Loans shall be calculated at the Base Rate except where itis expressly provided pursuant to this Agreement that a Eurodollar Rate is to apply.

     3.4 Designation and Conversion. Borrower shall have the right to designate or convertits Interest Options in accordance with the provisions hereof. Provided no Event of Default hasoccurred and is continuing and subject to the provisions of Section 3.5, Borrower may electto have a Eurodollar Rate apply or continue to apply to all or any portion of the principal balanceof the Notes, other than the Swing Loan Note. Each change in Interest Options shall be aconversion of the rate of interest applicable to the specified portion of the Loans, but suchconversion shall not change the respective outstanding principal balance of the Notes. TheInterest Options shall be designated or converted in the manner provided below:

          (a) Borrower shall give Agent a Request for Loan. Each such written notice shall specify theamount of Loan which is the subject of the designation, if any; the amount of borrowings into whichsuch borrowings are to be converted or for which an Interest Option is designated; the proposeddate for the designation or conversion and the Interest Period, if any, selected by Borrower. TheRequest for Loan shall be irrevocable and shall be given to Agent no later than the applicable RateDesignation Date. The Agent shall promptly deliver the Request for Loan to the Lenders.

          (b) No more than twelve (12) Eurodollar Rate Borrowings with twelve (12) Interest Periodsshall be in effect at any time.

          (c) Each designation or conversion of a Eurodollar Rate Borrowing shall occur on a EurodollarBusiness Day.

          (d) Except as provided in Section 3.5 hereof, no Eurodollar Rate Borrowing shall beconverted on any day other than the last day of the applicable Interest Period.

          (e) Unless a Request for Loan to the contrary is received as provided in this Agreement, eachEurodollar Rate Borrowing will convert to a Base Rate Borrowing after the expiration of theInterest Period.

     3.5 Special Provisions Applicable to Eurodollar Rate Borrowings and Money MarketLoans.

          (a) If the adoption of any applicable Legal Requirement or any change in any applicable LegalRequirement or in the interpretation or administration thereof by any Governmental Authority orcompliance by the Lenders with any request or directive (whether or not having the force of law) ofany central bank or other Governmental Authority shall at any time make it unlawful or impossiblefor any Lender to permit the establishment of or to maintain any Eurodollar Rate Borrowing or aMoney Market Loan, or to increase the cost to such Lender of participating in or maintaining anyLetter of Credit, the commitment of the Lenders to establish or maintain such Eurodollar RateBorrowing or a Money Market Loan, or to issue or participate in Letters of Credit shall forthwithbe suspended until such condition shall cease to exist and Borrower shall forthwith, upon

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demand by Agent to Borrower, (1) convert the Eurodollar Rate Borrowing with respect to whichsuch demand was made to a Base Rate Borrowing; (2) convert the Money Market LIBOR Loan with respectto which such demand was made to a Loan bearing interest at the Base Rate; (3) pay all accrued andunpaid interest to date on the amount so converted; and (4) pay any amounts required to compensatethe Lenders for any additional cost or expense which the Lenders may incur as a result of suchadoption of or change in such Legal Requirement or in the interpretation or administration thereofand any Funding Loss which the Lenders may incur as a result of such conversion. If, when Agent sonotifies Borrower, Borrower has given a Request for Loan specifying a Eurodollar Rate Borrowing ora Notice of Money Market Borrowing but the selected Interest Period has not yet begun, such Requestfor Loan or a Notice of Money Market Borrowing shall be deemed to be of no force and effect, as ifnever made, and the balance of the Loans specified in such Request for Loan shall bear interest atthe Base Rate until a different available Interest Option shall be designated in accordanceherewith.

          (b) If the adoption of any applicable Legal Requirement or any change in any applicable LegalRequirement or in the interpretation or administration thereof by any Governmental Authority orcompliance by any Lender with any request or directive of general applicability (whether or nothaving the force of law) of any central bank or Governmental Authority shall at any time as aresult of any portion of the principal balance of the Notes being maintained on the basis of aEurodollar Rate or as a Money Market Loan, or as a result of any Lender issuing or participating inLetters of Credit:

  (1)   subject any Lender (or make it apparent that any Lender issubject) to any Taxes, or any deduction or withholding for any Taxes, on orfrom any payment due under any Eurodollar Rate Borrowing, Money Market Loan orother amount due hereunder, other than income and franchise taxes of theUnited States and its political subdivisions; or
 
  (2)   change the basis of taxation of payments due from Borrower toany Lender under any Eurodollar Rate Borrowing or Money Market Loan (otherwisethan by a change in the rate of taxation of the overall net income of aLender); or
 
  (3)   impose, modify, increase or deem applicable any reserverequirement (excluding that portion of any reserve requirement included in thecalculation of the applicable interest rate), special deposit requirement orsimilar requirement (including, but not limited to, state law requirements andRegulation D) imposed, modified, increased or deemed applicable by anyGovernmental Authority against assets held by any Lender, or against depositsor accounts in or for the account of any Lender, or against loans made by anyLender, or against any other funds, obligations or other property owned orheld by any Lender; or

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  (4)   impose on any Lender any other condition regarding anyEurodollar Rate Borrowing, Money Market Loan or Letter of Credit;

and the result of any of the foregoing is to increase the cost to any Lender of agreeing to make orof making, renewing or maintaining such Eurodollar Rate Borrowing or Money Market Loan, or issuingor participating in Letters of Credit, or reduce the amount of principal or interest received byany Lender, then, upon demand by Agent, Borrower shall pay to such Lender, from time to time asspecified by such Lender, additional amounts which shall compensate such Lender for such increasedcost or reduced amount. Agent will promptly notify Borrower in writing of any event which willentitle any Lender to additional amounts pursuant to this paragraph. A Lender’s determination ofthe amount of any such increased cost, increased reserve requirement or reduced amount shall beprima facie evidence thereof. Borrower shall have the right, if it receives from Agent any noticereferred to in this paragraph, upon three Business Days’ notice to Agent, either (i) to repay infull (but not in part) any borrowing with respect to which such notice was given, together with anyaccrued interest thereon, or (ii) to convert the Eurodollar Rate Borrowing which is the subject ofthe notice to a Base Rate Borrowing or to convert the Money Market LIBOR Loan which is the subjectof the notice to a Loan bearing interest at the Base Rate; provided, that any such repayment orconversion shall be accompanied by payment of (x) the amount required to compensate a Lender forthe increased cost or reduced amount referred to in the preceding paragraph; (y) all accrued andunpaid interest to date on the amount so repaid or converted, and (z) any Funding Loss which anyLender may incur as a result of such repayment or conversion.

          (c) If for any reason with respect to any Interest Period Agent shall have determined (whichdetermination shall be prima facie evidence thereof) that:

(1) Agent is unable through its customary general practices to determine anyapplicable Eurodollar Rate, or

(2) by reason of circumstances affecting the applicable market generally, Agent isnot being offered deposits in United States dollars in such market, for theapplicable Interest Period and in an amount equal to the amount of any applicableEurodollar Rate Borrowing requested by Borrower, or

(3) any applicable Eurodollar Rate will not adequately and fairly reflect the costto the Lenders of making and maintaining such Eurodollar Rate Borrowing hereunderfor any proposed Interest Period,

then Agent shall give Borrower notice thereof and thereupon, (A) any Request forLoan previously given by Borrower designating the applicable Eurodollar RateBorrowing which has not commenced as of the date of such notice from Agent shall bedeemed for all purposes hereof to be of no force and effect, as if never given, and(B) until Agent shall notify Borrower that the circumstances giving rise to suchnotice from Agent no longer exist, each Request for Loan requesting the applicableEurodollar Rate shall be

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deemed a request for a Base Rate Borrowing, and any applicable Eurodollar RateBorrowing then outstanding shall be converted, without any notice to or fromBorrower, upon the termination of the Interest Period then in effect with respectto it, to a Base Rate Borrowing.

          (d) Borrower shall indemnify the Agent and each Lender against and hold the Agent and eachLender harmless from any Funding Loss. This agreement shall survive the payment of the Notes. Acertificate as to any additional amounts payable pursuant to this subsection and setting forth thereasons for the Funding Loss submitted by Agent to Borrower shall be prima facie evidence thereof.

          (e) The Borrower shall pay to the Agent or a Lender the Eurodollar Reserve Requirementincurred by that Lender within thirty (30) days after written demand by Agent to the Borrower. Thedemand setting forth the Eurodollar Reserve Requirement shall be prima facie evidence thereof.

     3.6 Funding Offices; Adjustments Automatic. Any Lender may, if it so elects, fulfillits obligation as to any Eurodollar Rate Borrowing or Money Market Loan by causing a branch oraffiliate of such Lender to make such Loan and may transfer and carry such Loan at, to, or for theaccount of, any branch office or affiliate of such Lender; provided, that in such event for thepurposes of this Agreement such Loan shall be deemed to have been made by such Lender and theobligation of Borrower to repay such Loan shall nevertheless be to such Lender and shall be deemedheld by it for the account of such branch or affiliate. Without notice to Borrower or any otherperson or entity, each rate required to be calculated or determined under this Agreement shallautomatically fluctuate upward and downward in accordance with the provisions of this Agreement.

     3.7 Funding Sources, Payment Obligations. Notwithstanding any provision of thisAgreement to the contrary, each Lender shall be entitled to fund and maintain its funding of all orany part of the Loans in any manner it sees fit, it being understood, however, that for thepurposes of this Agreement all determinations hereunder shall be made as if each Lender hadactually funded and maintained each Eurodollar Rate Borrowing and Money Market LIBOR Loan duringeach Interest Period through the purchase of deposits having a maturity corresponding to suchInterest Period and bearing an interest rate equal to the interest rate for such Interest Period.Notwithstanding the foregoing, Funding Losses, increased costs and other obligations relating toEurodollar Rate Borrowings and Money Market Loans described in Section 3.5 of thisAgreement will only be paid by the Borrower as and when actually incurred by the Lenders.

     3.8 Mitigation, Non-Discrimination.

          (a) Each Lender will notify the Borrower through the Agent of any event occurring after thedate of this Agreement which will require or enable such Lender to take the actions described inSections 3.5(a) or (b) of this Agreement as promptly as practicable after itobtains knowledge thereof and determines to request such action, and (if so requested by theBorrower through the Agent) will designate a different lending office of such Lender for theapplicable Eurodollar Rate Borrowing or Money Market Loan or will

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take such other action as the Borrower reasonably requests if such designation or action isconsistent with the internal policy of such Lender and legal and regulatory restrictions, can beundertaken at no additional cost, will avoid the need for, or reduce the amount of, such action andwill not, in the sole opinion of such Lender, be disadvantageous to such Lender (provided that suchLender will have no obligation to designate a different lending office which is located in theUnited States of America).

          (b) None of the Lenders shall be able to pass through to the Borrower changes and costs underSection 3.5 of this Agreement on a discriminating basis, such that such changes and costsare not also passed through by each Lender to other customers of such Lender similarly situatedwhere such customer is subject to documents providing for such pass through.

          (c) If any Lender elects under Section 3.5 of this Agreement to suspend or terminatethe availability of Eurodollar Rate Borrowings for any material period of time, and the eventgiving rise to such election is not generally applicable to all of the Lenders, the Borrower maywithin sixty (60) days after notification of such Lender’s election, and so long as no Event ofDefault is then in existence, either (i) demand that such Lender, and upon such demand, such Lendershall promptly, assign its Lender Commitment to another financial institution subject to and inaccordance with the provisions of Section 10.5 of this Agreement for a purchase price equalto the unpaid balance of principal, accrued interest, the unpaid balance of the Fee and expensesowing to such Lender pursuant to this Agreement, or (ii) pay such Lender the unpaid balance ofprincipal, accrued interest, the unpaid balance of the Fee and expenses owing to such Lenderpursuant to this Agreement, whereupon, such Lender shall no longer be a party to this Agreement orhave any rights or obligations hereunder or under any other Credit Documents, and the Commitmentshall immediately and permanently be reduced by an amount equal to the Lender Commitment of suchLender.

4. Representations and Warranties.

     To induce the Lenders to enter into this Agreement and to make the Loans, the Borrowerrepresents and warrants to the Agent and the Lenders as follows:

     4.1 Organization. The Borrower is duly organized, validly existing and in goodstanding as a real estate investment trust under the laws of the state of Maryland; has all powerand authority to conduct its business as presently conducted; and is duly qualified to do businessand in good standing in every state where the location of its Property requires it to be qualifiedto do business, unless the failure to be so qualified would not reasonably be expected to have aMaterial Adverse Effect.

     4.2 Financial Statements. The financial statements delivered to the Agent fairlypresent, in accordance with Generally Accepted Accounting Principles (provided, however, that theQuarterly Unaudited Financial Statements are subject to normal year-end adjustments and may containcondensed footnotes as permitted by regulations of the United States Securities and ExchangeCommission), the financial condition and the results of operations of the Borrower as at the datesand for the periods indicated. No

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Material Adverse Change has occurred since the dates of such financial statements. TheBorrower is not subject to any instrument or agreement which would materially prevent it fromconducting its business as it is now conducted or as it is contemplated to be conducted.

     4.3 Enforceable Obligations; Authorization. The Credit Documents are legal, valid andbinding obligations of the Parties, enforceable in accordance with their respective terms, exceptas may be limited by bankruptcy, insolvency and other laws affecting creditors’ rights generallyand by general equitable principles. The execution, delivery and performance of the CreditDocuments have all been duly authorized by all necessary action; are within the power and authorityof the Parties; do not and will not contravene or violate any Legal Requirement or theOrganizational Documents of the Parties; do not and will not result in the breach of, or constitutea default under, any agreement or instrument by which the Parties or any of their respectiveProperty may be bound or affected, except where such breach or default could not reasonably beexpected to have a Material Adverse Effect; and do not and will not result in the creation of anyLien upon any Property of any of the Parties except as expressly contemplated therein. Allnecessary permits, registrations and consents for such making and performance have been obtainedexcept where the lack thereof would not reasonably be expected to have a Material Adverse Effect.

     4.4 Other Debt. The Borrower is not in default in the payment of any otherIndebtedness or under any agreement, mortgage, deed of trust, security agreement or lease to whichit is a party which default would reasonably be expected to have a Material Adverse Effect.

     4.5 Litigation. There is no litigation or administrative proceeding pending or, tothe knowledge of the Borrower, threatened against, or any outstanding judgment, order or decreeaffecting, the Borrower before or by any Governmental Authority which is not adequately covered byinsurance or which, if determined adversely to the Borrower could reasonably be expected to have aMaterial Adverse Effect. The Borrower is not in default with respect to any judgment, order ordecree of any Governmental Authority which default could reasonably be expected to have a MaterialAdverse Effect.

     4.6 Taxes. The Borrower has filed all tax returns required to have been filed andpaid all taxes shown thereon to be due, except those for which extensions have been obtained, thosewhich are being contested in good faith and those for which the Borrower’s failure to file a returnor pay could not reasonably be expected to have a Material Adverse Effect.

     4.7 Regulation U. None of the proceeds of any Loan or Letter of Credit will be usedfor the purpose of purchasing or carrying directly or indirectly any margin stock or for any otherpurpose that would constitute this transaction a “purpose credit” within the meaning of RegulationU of the Board of Governors of the Federal Reserve System.

     4.8 Securities Act of 1933. Other than the Agent’s efforts in syndicating the Loans(for which the Agent is responsible) neither the Borrower nor any agent acting for it

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has offered the Notes or any similar obligation of the Borrower for sale to or solicited anyoffers to buy the Notes or any similar obligation of the Borrower from any Person other than theAgent or any Lender, and neither the Borrower nor any agent acting for it will take any actionwhich would subject the sale of the Note to the provisions of Section 5 of the Securities Act of1933, as amended.

     4.9 No Contractual or Corporate Restrictions. The Borrower is not a party to, orbound by, any contract, agreement or charter or other corporate restriction materially andadversely affecting its business, Property, assets, operations or condition, financial orotherwise.

     4.10 Investment Company Act Not Applicable. The Borrower is not an “investmentcompany”, or a company “controlled” by an “investment company”, within the meaning of theInvestment Company Act of 1940, as amended.

     4.11 Public Utility Holding Company Act Not Applicable. The Borrower is not a“holding company”, or a “subsidiary company” of a “holding company”, or an “affiliate” of a“holding company”, or an affiliate of a “subsidiary company” of a “holding company”, as such termsare defined in the Public Utility Holding Company Act of 1935, as amended.

     4.12 ERISA Not Applicable. The Borrower is not subject to any requirements of theEmployee Retirement Income Security Act of 1974 as amended from time to time, or any rules,regulations, rulings or interpretations adopted by the Internal Revenue Service or the Departmentof Labor thereunder.

5. Affirmative Covenants.

     The Borrower covenants and agrees with the Agent and the Lenders that prior to the terminationof this Agreement it will do, and if necessary cause to be done, each and all of the following:

     5.1 Taxes, Insurance, Existence, Regulations, Property, etc. At all times (a) paywhen due all taxes and governmental charges of every kind upon it or against its income, profits orProperty, unless and only to the extent that the same shall be contested in good faith and reserveswhich are adequate under Generally Accepted Accounting Principles have been established therefor,or unless such failure to pay could not reasonably be expected to have a Material Adverse Effect;(b) do all things necessary to preserve its existence, qualifications, rights and franchises in allStates where such qualification is necessary or desirable, except where failure to obtain the samecould not reasonably be expected to have a Material Adverse Effect; (c) comply with all applicableLegal Requirements in respect of the conduct of its business and the ownership of its Propertyexcept where failure to so comply could not reasonably be expected to have a Material AdverseEffect; and (d) cause its Property to be protected, maintained and kept in good repair (reasonablewear and tear excepted) and make all replacements and additions to its Property as may bereasonably necessary to conduct its business.

     5.2 Financial Statements and Information. Furnish or caused to be furnished (whichmay be by electronic access) to the Agent each of the following: (a) as soon as

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available and in any event within 90 days after the end of each fiscal year of the Parent,Annual Audited Financial Statements of the Borrower and the Parent; (b) as soon as available and inany event within 50 days after the end of each quarter (except the last quarter) of each fiscalyear of the Parent, Quarterly Unaudited Financial Statements of the Borrower and the Parent; (c)concurrently with the financial statements provided for in Sections 5.2(a) and (b)hereof, an Officer’s Certificate, together with such schedules, computations and other information(including, without limitation, if provided to Borrower information as to Unconsolidated Affiliatesof the Borrower), in reasonable detail, as may be required by the Agent to demonstrate compliancewith the covenants set forth herein or reflecting any non-compliance therewith as of the applicabledate, all certified as true, correct and complete by a managing director, vice president, seniorvice president, controller, a co-controller of Borrower and of the Parent; (d) promptly after thefiling thereof, all reports to or filings made by the Parent or the Borrower or any of itsSubsidiaries with the Securities and Exchange Commission, including, without limitation,registration statements and reports on Forms 10-K, 10-Q and 8-K (or their equivalents); (e) withintwo (2) Business Days after the receipt thereof, a copy of the notification to the Borrower or tothe Parent of the respective Credit Rating of each, or change therein, and (f) such otherinformation relating to the financial condition and affairs of the Borrower and the Parent as fromtime to time may be reasonably requested by any Lender. The Agent will send to each Lender theinformation received by the Agent pursuant to this Section 5.2 promptly after the receiptthereof by Agent. The financial calculations for Sections 5.3, 5.15 and6.4 shall be made (1) on the date of each Loan or issuance, renewal or extension of aLetter of Credit using the best information available to the Borrower, and (2) on the last day ofeach of the Parent’s fiscal quarters.

     5.3 Financial Tests. Have and maintain on a consolidated basis in accordance withGenerally Accepted Accounting Principles:

          (a) a Secured Debt to Total Asset Value Ratio no greater than forty percent (40%);

          (b) a Coverage Ratio of not less than 2.0:1.0;

          (c) a Fixed Charge Coverage Ratio of not less than 1.75:1.00;

          (d) a Tangible Net Worth of at least Three Billion Five Hundred Million Dollars($3,500,000,000.00); and

          (e) a Debt to Total Asset Value Ratio no greater than sixty percent (60%), provided, however,that same may increase from time to time up to sixty-five percent (65%) for no more than two (2)consecutive calendar quarters.

     5.4 Inspection. In order to permit the Agent to ascertain compliance with the CreditDocuments, during normal business hours permit the Agent to inspect its Property, to examine itsfiles, books and records and make and take away copies thereof, and to discuss its affairs with itsofficers and accountants, all at such times and intervals and to such extent as a Lender mayreasonably desire.

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     5.5 Further Assurances. Promptly execute and deliver any and all other and furtherinstruments which may be requested by the Agent to cure any defect in the execution and delivery ofany Credit Document or more fully to describe particular aspects of the Borrower’s agreements setforth in the Credit Documents or so intended to be.

     5.6 Books and Records. Maintain books of record and account in accordance withGenerally Accepted Accounting Principles.

     5.7 Insurance. Maintain insurance with such insurers, on such of its properties, insuch amounts and against such risks as is consistent with insurance maintained by businesses ofcomparable type and size in the industry, and furnish the Agent satisfactory evidence thereofpromptly upon request.

     5.8 Notice of Certain Matters. Notify the Agent promptly upon acquiring knowledge ofthe occurrence of any of the following: the institution or threatened institution of any lawsuit oradministrative proceeding affecting the Borrower in which the claim exceeds $25,000,000.00 and ifdetermined adversely could have a Material Adverse Effect; when the Borrower believes that therehas been a Material Adverse Change; or the occurrence of any Event of Default or any Default. TheBorrower will notify the Agent in writing at least thirty (30) Business Days prior to the date thatthe Borrower changes its name or the location of its chief executive office or principal place ofbusiness or the place where it keeps its books and records.

     5.9 Use of Proceeds. The proceeds of the Loans will be used for general businesspurposes, including (without limitation) for acquisition of multifamily real estate properties, forthe development and enhancement of multifamily real estate properties, for the costs ofconstruction of multifamily real estate projects owned or to be acquired by the Borrower, forrepurchase of the Borrower’s stock, or for other investments permitted by this Agreement.Notwithstanding the foregoing, none of the proceeds of the Loans will be used to finance, fund orcomplete any hostile acquisition of any Person.

     5.10 Expenses of and Claims Against the Agent and the Lenders. To the extent notprohibited by applicable law, the Borrower will pay all reasonable costs and expenses incurred tothird parties and reimburse the Agent and each Lender, as the case may be, for any and allreasonable expenditures of every character incurred or expended from time to time, in connectionwith (a) regardless of whether a Default or Event of Default shall have occurred, the Agent’spreparation, negotiation and completion of the Credit Documents, and (b) during the continuance ofan Event of Default, all costs and expenses relating to the Agent’s and such Lender’s exercisingany of its rights and remedies under this or any other Credit Document, including, withoutlimitation, attorneys’ fees, legal expenses, and court costs; provided, that no rights or optiongranted by the Borrower to the Agent or any Lender or otherwise arising pursuant to any provisionof this or any other instrument shall be deemed to impose or admit a duty on the Agent or anyLender to supervise, monitor or control any aspect of the character or condition of any property orany operations conducted in connection with it for the benefit of the Borrower or any other personor entity other than the Agent or such Lender. Notwithstanding the foregoing, the Borrower shallnot be charged with any cost or expense incurred by the Agent or any Lender relating

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to disputes or claims among or between the Agent, the Lenders, or any of them unless duringthe continuance of an Event of Default and related to details of enforcement of the Lenders’ rightsunder the Credit Documents.

     5.11 Legal Compliance; Indemnification.

          (a) The Borrower shall operate its Property and businesses in full compliance with all LegalRequirements. It shall not constitute an Event of Default if there is a failure to comply with anyLegal Requirement which failure could not reasonably be expected to have a Material Adverse Effect.The Borrower shall indemnify the Agent and each Lender, their directors, officers, employees andshareholders (the “Indemnified Parties”) for and defend and hold the Indemnified Parties harmlessagainst any and all claims, demands, liabilities, causes of action, penalties, obligations,damages, judgments, deficiencies, losses, costs or expenses (including, without limitation,interest, penalties, attorneys’ fees, and amounts paid in settlement) threatened or incurred byreason of, arising out of or in any way related to (i) any failure of the Borrower to so complywith the provisions of any Legal Requirement, this Agreement or the other Credit Documents, or (ii)the Agent or any Lender’s making of the Loans, issuing or participating in any Letters of Credit,or any other acts or omissions taken or made in connection with the Loans or Letters of Credit(including any refusal by the Issuing Bank to honor a demand for payment under a Letter of Creditif the documents presented in connection with such demand do not strictly comply with the terms ofthe Letter of Credit), and any and all matters arising out of any act, omission, event orcircumstance, regardless of whether the act, omission, event or circumstance constituted aviolation of any such Legal Requirement, this Agreement or the other Credit Documents at the timeof its existence or occurrence. THE BORROWER SHALL INDEMNIFY THE AGENT AND EACH LENDER PURSUANT TOTHIS SECTION REGARDLESS OF WHETHER THE ACT, OMISSION, FACTS, CIRCUMSTANCES OR CONDITIONS GIVINGRISE TO SUCH INDEMNIFICATION WERE CAUSED IN WHOLE OR IN PART BY THE AGENT’S OR SUCH LENDER’SNEGLIGENCE (SIMPLE, BUT NOT GROSS NEGLIGENCE).

          (b) The Parent will comply with all Legal Requirements to maintain, and will at all timeselect, qualify as and maintain, its status as a real estate investment trust under Section856(c)(1) of the Code.

          (c) The Parent will (i) maintain at least one class of common shares of the Parent havingtrading privileges on the New York Stock Exchange or the American Stock Exchange, or which islisted on The NASDAQ Stock Market’s National Market; (ii) own, directly or indirectly, at leastfifty-one percent (51%) of (1) the shares of beneficial interest of the Borrower, and (2) the ClassA-2 Common Units of the Borrower and any other class of security issued by the Borrower with thepower to elect the Trustees of the Borrower; (iii) maintain management and control of the Borrower;(iv) not sell, transfer or convey any of the shares of beneficial interest of the Borrower owned bythe Parent, except (A) in payment of the purchase price of Property (including mergers with andacquisitions of Persons) acquired by the Borrower, (B) upon conversion or redemption of securitiesof the Borrower in accordance with their terms or (C) upon any repurchase by the Borrower of theBorrower’s securities from the Parent in connection with a repurchase by the Parent of

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the Parent’s securities; and (v) hold all of its assets and conduct all of its operationsthrough the Borrower, the QRS Entities in existence on October 31, 2001 and one or more of theBorrower’s Subsidiaries.

     5.12 Borrower’s Performance. If the Borrower should fail to comply with any of theagreements, covenants or obligations of the Borrower under this Agreement or any other CreditDocument which requires the payment of money, then the Agent (in the Borrower’s name or in Agent’sname) may, if such payment has not been made within ten (10) days after written request from Agent,perform or cause to be performed such agreement, covenant or obligation, for the account of theBorrower and at the Borrower’s sole expense, but shall not be obligated to do so. Any and allreasonable expenses thus incurred or paid by the Agent and by any Lender shall be the Borrower’sdemand obligations to the Agent or such Lender and shall bear interest from the date of demandtherefor until the date that the Borrower repays it to the Agent or the applicable Lender at thePast Due Rate. Upon making any such payment or incurring any such expense, the Agent or theapplicable Lender shall be fully subrogated to all of the rights of the Person receiving suchpayment. Any amounts owing by the Borrower to the Agent or any Lender pursuant to this provisionor any other provision of this Agreement shall automatically and without notice be secured by anycollateral provided by the Credit Documents. The amount and nature of any such expense and thetime when paid shall, absent manifest error, be fully established by the affidavit of the Agent orthe applicable Lender or any of the Agent’s or the applicable Lender’s officers or agents.

     5.13 Professional Services. Promptly upon the Agent’s request to satisfy itself orthe request of any Lender, the Borrower shall: (a) allow an inspection and/or appraisal of theBorrower’s Property to be made by a Person approved by the Agent in its sole discretion; and (b) ifthe Agent believes that an Event of Default has occurred or is about to occur, cause to beconducted or prepared any other written report, summary, opinion, inspection, review, survey, auditor other professional service relating to the Borrower’s Property or any operations in connectionwith it (all as designated in the Agent’s request), including, without limitation, any accounting,auctioneering, architectural, consulting, engineering, design, legal, management, pest control,surveying, title abstracting or other technical, managerial or professional service relating tosuch property or its operations. So long as no Event of Default has occurred and is continuing,the foregoing shall not be at the Borrower’s expense.

     5.14 Capital Adequacy.

          (a) If after the date of this Agreement, the Agent or any Lender shall have determined thatthe adoption or effectiveness of any applicable law, rule or regulation regarding capital adequacyof general applicability, or any change therein, or any change in the interpretation oradministration thereof by any Governmental Authority, central bank or comparable agency chargedwith the interpretation or administration thereof, or compliance by the Agent or any Lender withany request or directive regarding capital adequacy of general applicability (whether or not havingthe force of law) of any such Governmental Authority, central bank or comparable agency, has orwould have the effect of reducing the rate of return on the Agent’s or any Lender’s capital as aconsequence of its obligations

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hereunder to a level below that which the Agent or such Lender could have achieved but forsuch adoption, change or compliance (taking into consideration the Agent’s or such Lender’spolicies with respect to capital adequacy) by an amount deemed by the Agent or such Lender to bematerial, then from time to time, the Borrower shall pay to the Agent or such Lender suchadditional amount or amounts as will compensate the Agent or such Lender for such reduction.

          (b) A certificate of the Agent or such Lender setting forth such amount or amounts as shall benecessary to compensate the Agent or such Lender as specified in Section 5.14(a) hereof andmaking reference to the applicable law, rule or regulation shall be delivered as soon aspracticable to the Borrower and shall be prima facie evidence thereof. The Borrower shall pay theAgent or such Lender the amount shown as due on any such certificate within fourteen (14) BusinessDays after the Agent or such Lender delivers such certificate. In preparing such certificate, theAgent or such Lender may employ such assumptions and allocations of costs and expenses as it shallin good faith deem reasonable and may use any reasonable averaging and attribution method.

     5.15 Property Pool.

          (a) The Borrower (or a Subsidiary of the Borrower if the conditions in clause (c)below are satisfied) will at all times own fee simple title to a pool (the “Pool”) of Real Propertythat is not subject to any Lien other than Permitted Encumbrances (the “Pool Real Estate”) andexcept as permitted by Section 6.5 with an aggregate Pool Value of at least one hundredsixty-seven percent (167%) of the Borrower’s Indebtedness other than Secured Debt outstanding fromtime to time, with the following characteristics:

     (i) the Borrower must provide the Agent with written confirmation that it has receivedfrom third party independent environmental consultants, written assessments for each PoolReal Estate in, or to be added to, the Pool that do not disclose any material environmentalconditions or risks related to such properties, and

     (ii) the Property is not subject to or affected by any Limiting Agreement except aspermitted by Section 6.5.

If requested by the Agent, the Borrower will provide to the Agent written assessments from thirdparty independent environmental consultants for all Pool Real Estate acquired after the date ofthis Agreement. If Super-Majority Lenders determine that there are material environmentalconditions existing on or risks to such properties, the properties will be excluded from the Pool.

          (b) Notwithstanding the foregoing, (i) the maximum Pool Value that can be attributable to theValue of land not improved for multifamily use (not including land that is either under developmentfor multifamily use or planned for commencement of development for multifamily use within three (3)years after the date of acquisition) is five percent (5%) of the Pool Value after adding the effectof said land, (ii) the maximum Pool Value that can be attributable to the Value (in the aggregate)of Real Property that is under

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construction or development, that has not reached the Calculation Date, that has reached theCalculation Date but the Occupancy Level is less than eighty percent (80%), unimproved land that isplanned for commencement of development within three (3) years after the date of acquisition, andland not improved for multifamily use, is twenty-five percent (25%) of the Pool Value after addingthe effect of said Real Property and land; and (iii) the maximum Pool Value that can beattributable to the Value of improved property not used for multifamily residential use (propertywill be considered as multifamily residential use even if it includes other non-primary uses whichare incidental to the residential use, such as retail or office) is ten percent (10%) of the PoolValue after adding the effect of said property.

            (c) If any Pool Real Estate is owned by a Subsidiary, then it may be included in the Pool onlyif:

     (i) the owner of the Pool Real Estate is either (1) a wholly owned Subsidiary of theBorrower or (2) if not a wholly owned Subsidiary, then (x) the value of the Pool RealEstate owned by such Subsidiary (“Partial Subsidiary Real Estate”) to be used in thecalculation in clauses (a) and (b) above shall be as provided inclauses (a) and (b) multiplied by the cumulative percentage interest of theSubsidiary legally owned by the Borrower, (y) the maximum Pool Value that can beattributable to Partial Subsidiary Real Estate is seventeen and one-half percent (17-1/2%)of the Pool Value after adding the effect of the Partial Subsidiary Real Estate, and (z)the Borrower controls the right to sell, encumber or refinance the Partial Subsidiary RealEstate;

     (ii) the owner of the Pool Real Estate (1) either (x) executes a Guaranty and deliversit to the Agent, together with such Subsidiary’s Organizational Documents and currentcertificates of existence and good standing for the state in which it is organized and suchGuaranty must remain in full force and effect, or (y) if such Subsidiary is not whollyowned by the Borrower, has no Indebtedness other than Non-recourse Debt, and other thanIndebtedness to the Borrower subordinated to the Indebtedness incurred under this Agreementon terms satisfactory to the Agent; and (2) would not at any time be in default ofSections 7.1(g), (h), (i), (j), or (k), if saidsubsections were applicable to said owner; and

     (iii) the indicia of ownership of the Subsidiary is not subject to a Lien (other thanPermitted Encumbrances).

     5.16 DC Holdings. The Borrower shall maintain at least 99.5% aggregate ownership ofthe indicia of ownership of each DC Holdings Entity, and shall maintain management and control ofeach DC Holdings Entity.

6. Negative Covenants.

     The Borrower covenants and agrees with the Agent and the Lenders that prior to the terminationof this Agreement it will not do any of the following:

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     6.1 Mergers, Consolidations and Acquisitions of Assets. In any singletransaction or series of related transactions, directly or indirectly: (a) liquidate or dissolve;(b) be a party to any merger or consolidation other than a merger or consolidation in which (i)the Borrower is the surviving entity after such merger or consolidation, or (ii) the individualsconstituting the Borrower’s Board of Trustees immediately prior to such merger or consolidationrepresent a majority of the surviving entity’s Board of Directors or Board of Trustees after suchmerger or consolidation; or (c) sell, convey or lease all or substantially all of its assets.

     6.2 Redemption. At any time redeem, retire or otherwise acquire, directly orindirectly, any shares of its capital stock if such action would cause the Borrower to not be incompliance with this Agreement.

     6.3 Nature of Business. Change the nature of its business or enter into any businesswhich is substantially different from the business in which it is presently engaged. Borrower’sprimary business will be the ownership, operation and development of multi-family residentialproperties, and may include other business initiatives, investments and activities which arerelated, but incidental, to Borrower’s primary business, subject only to the limitations onspecific loans and investments described below (“Specified Permitted Holdings”); provided, however,that the aggregate value of the Specified Permitted Holdings shall not at any time exceed thirtypercent (30%) of the Total Asset Value after giving effect to the Specified Permitted Holdings.

     “Specified Permitted Holdings” means the following:

          (a) securities received in settlement of liabilities created in the ordinary course ofbusiness, so long as the market value of such securities does not exceed five percent (5%) of theTotal Asset Value after giving effect to such investment;

          (b) investments in Unconsolidated Affiliates that are engaged primarily in Borrower’s primarybusiness as described in this section, so long as the aggregate amount of such investments does notexceed twenty percent (20%) of the Total Asset Value after giving effect to such investments;

          (c) loans, advances, and extensions of credit to Persons (who are not Affiliates of theBorrower), so long as the aggregate unpaid amount of such loans does not exceed ten percent (10%)of the Total Asset Value after giving effect to such loans;

          (d) investments in Persons not included in any other Specified Permitted Holdings so long asthe aggregate value of all such investments (valued at the lower of cost or then market value) doesnot exceed ten percent (10%) of the Total Asset Value after giving effect to such investments;

          (e) investments in income producing Real Property that is not primarily multifamilyresidential property (property will be considered as primarily multifamily residential propertyeven if it includes other non-primary uses which are incidental to the residential use, such asretail or office), so long as the aggregate Historical Value of such

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investments does not exceed ten percent (10%) of the Total Asset Value after giving effect tosuch investments;

          (f) investments in land not improved for multifamily use (not including land that is eitherunder development or planned for commencement of development within three (3) years after the dateof acquisition), so long as the aggregate Historical Value of such investments does not exceedseven and one-half percent (7-1/2%) of the Total Asset Value after giving effect to suchinvestments; and

          (g) investments of any kind not included in any other Specified Permitted Holdings and whichare not incidental to Borrower’s primary business as described in this Section, so long as theaggregate value of such investments (valued at the lower of cost or then market value) does notexceed five percent (5%) of the Total Asset Value after giving effect to such investments.

     6.4 Transactions with Related Parties. Enter into any transaction or agreement withany officer, director, or holder of more than five percent (5%) (based on voting rights) of theissued and outstanding capital stock of the Borrower (or any Affiliate of the Borrower), unless thesame is upon terms substantially similar to those obtainable from qualified wholly unrelatedsources, and is approved by the majority of the Borrower’s non-interested directors.

     6.5 Limiting Agreements. Neither Borrower nor any of its Subsidiaries has enteredinto, and after the date hereof, neither Borrower nor any of its Subsidiaries shall enter into, anyLimiting Agreements; provided that so long as the Borrower has received an S&P Rating and a Moody’sRating that are BBB/Baa2 or better (respectively), up to five percent (5%) of the Pool Value (afteradding the effect of said property) may be subject to debt-related agreements (but not the relatedmortgages or pledges) that require the owner of the project to mortgage and pledge the project tosecure the debt if the Borrower’s S&P Rating and Moody’s Rating are below BBB-/Baa3 (respectively).

     6.6 Parent Negative Covenants. The Parent will not (a) have any Subsidiary that is a“qualified REIT subsidiary” under Section 856 of the Code other than the QRS Entities; (b) own anyProperty other than the ownership interests of the Borrower, and the Parent’s ownership interestsas of October 31, 2001 in the QRS Entities; (c) give or allow any Lien on any of its Propertyincluding the ownership interests of the Borrower; and (d) create, incur, suffer or permit toexist, or assume or guarantee, directly or indirectly, contingently or otherwise, or become orremain liable with respect to (i) any Indebtedness if the aggregate of such Indebtedness and theIndebtedness of the Borrower would violate Sections 5.3(a), (b), (c) or (e) if such aggregateIndebtedness is treated as the Borrower’s Indebtedness, and (ii) any Indebtedness of a Person otherthan the Parent.

7. Events of Default and Remedies.

     7.1 Events of Default. If any of the following events shall occur, then, as to theevents described in Sections 7.1(b), (c), and (d), if the event has notbeen waived, cured or remedied within twenty (20) days after the Agent gives the Borrower notice ofsuch event,

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at any time thereafter, and as to all of the other events described herein, at any time, theAgent may do any or all of the following: (1) without notice to the Borrower, declare the Notes tobe, and thereupon the Notes shall forthwith become, immediately due and payable, together with allaccrued interest thereon, without notice of any kind, notice of acceleration or of intention toaccelerate, presentment and demand or protest, all of which are hereby expressly waived; (2)without notice to the Borrower, terminate the Commitment; (3) exercise, as may any other Lender,its rights of offset against each account and all other Property of the Borrower in the possessionof the Agent or any such Lender, which right is hereby granted by the Borrower to the Agent andeach Lender; and (4) exercise any and all other rights pursuant to the Credit Documents:

          (a) The Borrower shall fail to pay or prepay any principal of or interest on the Notes, anyreimbursement obligation in respect of an LC Disbursement, or any fee or any other obligationhereunder within five (5) days after it was due; or

          (b) The Borrower or any Guarantor shall (i) fail to pay when due (whether on the scheduledmaturity date or otherwise), or within any applicable period of grace, any principal of or intereston (1) any other Indebtedness, other than Non-recourse Debt or Disqualified Stock, in excess of$35,000,000.00 in principal amount, or (2) Non-recourse Debt in excess of $50,000,000.00 inprincipal amount; or (ii) fail to comply with Section 1004 of the Indenture dated February 1, 1994between the Borrower and Morgan Guaranty Trust Company of New York, as Trustee, as said Section1004 may be amended with the consent of the Majority Lenders; or

          (c) Any written representation or warranty made in any Credit Document by or on behalf of theBorrower, when taken as a whole shall prove to have been incorrect, false or misleading in anymaterial respect; or

          (d) Default shall occur in the punctual and complete performance of any covenant of theBorrower or any other Person other than the Agent or the Lenders contained in any Credit Documentnot specifically set forth in this Section; or

          (e) A final judgment or judgments in the aggregate for the payment of money in excess of$35,000,000.00 shall be rendered against the Borrower or any Guarantor and the same shall remainundischarged for a period of thirty (30) days during which execution shall not be effectivelystayed; or

          (f) The Borrower shall not be in compliance with any provision of Section 6.3 duringthe period covered by an Officer’s Certificate and such non-compliance remains in existence on thedate the next Officer’s Certificate is required to be presented to the Agent under Section5.2(c) of this Agreement; provided, however, that such right to defer compliance shall beavailable to the Borrower for each such provision no more than once every twelve (12) months; or

          (g) Any order shall be entered in any proceeding against the Borrower or any Guarantordecreeing the dissolution, liquidation or split-up thereof, and such order shall remain in effectfor more than thirty (30) days; or

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          (h) The Borrower or any Guarantor shall make a general assignment for the benefit of creditorsor shall petition or apply to any tribunal for the appointment of a trustee, custodian, receiver orliquidator of all or any substantial part of its business, estate or assets or shall commence anyproceeding under any bankruptcy, reorganization, arrangement, insolvency, readjustment of debt,dissolution or liquidation law of any jurisdiction, whether now or hereafter in effect; or

          (i) Any such petition or application shall be filed or any such proceeding shall be commencedagainst the Borrower or any Guarantor and the Borrower or such Guarantor by any act or omissionshall indicate approval thereof, consent thereto or acquiescence therein, or an order shall beentered appointing a trustee, custodian, receiver or liquidator of all or any substantial part ofthe assets of such Person or granting relief to such Person or approving the petition in any suchproceeding, and such order shall remain in effect for more than ninety (90) days; or

          (j) The Borrower or any Guarantor shall fail generally to pay its debts as they become due orsuffer any writ of attachment or execution or any similar process to be issued or levied against itor any substantial part of its Property which is not released, stayed, bonded or vacated withinthirty (30) days after its issue or levy; or

          (k) The Borrower or any Guarantor shall have concealed, removed, or permitted to be concealedor removed, any part of its Property, with intent to hinder, delay or defraud its creditors or anyof them, or made or suffered a transfer of any of its Property which may be fraudulent under anybankruptcy, fraudulent conveyance or similar law; or shall have made any transfer of its Propertyto or for the benefit of a creditor at a time when other creditors similarly situated have not beenpaid.

     7.2 Remedies Cumulative. No remedy, right or power conferred upon the Agent or theLenders is intended to be exclusive of any other remedy, right or power given hereunder or now orhereafter existing at law, in equity, or otherwise, and all such remedies, rights and powers shallbe cumulative.

     7.3 Guaranty Proceeds.

          (a) Notwithstanding any other provision of any Credit Document to the contrary, any funds,claims, or distributions actually received by Agent for the account of any Lender as a result ofthe enforcement of, or pursuant to, any Guaranty, net of Agent’s and Lenders’ expenses ofcollection thereof (such net amount, “Guaranty Proceeds”), shall be made available for distributionequally and ratably (in proportion to the aggregate amount of principal, interest and other amountsthen owed in respect of the Obligations or of an issuance of Public Debt (as defined below), as thecase may be) among the Agent, the Lenders and the trustee or trustees of any Indebtedness notsubordinated to the Obligations (or to the holders thereof), issued by Borrower, before or afterthe date of this Agreement, in offerings registered under the Securities Act of 1933, as amended,or in transactions exempt from registration pursuant to rule 144A thereof (“Public Debt”). Agentis hereby authorized by Borrower, by each Lender and by each Guarantor (by its execution anddelivery of the Guaranty to which it is party) to make such Guaranty Proceeds so available. NoLender

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shall have any interest in any amount paid over by Agent to the trustee or trustees in respectof any Public Debt (or to the holders thereof) pursuant to the foregoing authorization. ThisSection 7.3(a) shall apply (i) solely to Guaranty Proceeds and not to any payments, funds,claims or distributions received by Agent or Lenders directly or indirectly from Borrower or anyother Person other than from a Guarantor pursuant to a Guaranty, and (ii) as to Public Debt issuedafter December 20, 2000, only if the documents governing the Public Debt provide for the samesharing with the Lenders of guaranty proceeds recovered to pay the Public Debt. Borrower is awareof the terms of the Guaranty, and specifically understands and agrees with Agent and the Lendersthat, to the extent Guaranty Proceeds are distributed to holders of Public Debt or their respectivetrustees, such Guarantor has agreed that the Obligations will not be deemed reduced by any suchdistributions, and each Guarantor shall continue to make payments pursuant to its Guaranty untilsuch times as the Obligations have been paid in full (and the Commitment has been terminated andany LC Exposure reduced to zero), after taking into account any such distributions of GuarantyProceeds in respect of Indebtedness other than the Obligations.

          (b) Nothing contained herein shall be deemed (i) to limit, modify, or alter the rights ofAgent and Lenders under any Guaranty, (ii) to subordinate the Obligations to any Public Debt, or(iii) to give any holder of Public Debt (or any trustee for such holder) any rights of subrogation.

          (c) This Agreement and each Guaranty are for the sole benefit of Agent and the Lenders andtheir respective successors and assigns. Nothing contained herein or in any Guaranty shall bedeemed for the benefit of any holder of Public Debt, or any trustee for such holder; nor shallanything contained herein or therein be construed to impose on Agent or Lenders any fiduciaryduties, obligations or responsibilities to the holder of any Public Debt or their trustees(including, but not limited to, any duty to pursue any Guarantor for payment under its Guaranty).

8. The Agent.

     8.1 Appointment, Powers and Immunities.

          (a) Each Lender hereby irrevocably appoints and authorizes the Agent to act as its agenthereunder and under the other Credit Documents with such powers as are specifically delegated tothe Agent by the terms hereof and thereof, together with such other powers as are reasonablyincidental thereto. The Agent (i) shall not have any duties or responsibilities except thoseexpressly set forth in this Agreement and the other Credit Documents, and shall not by reason ofthis Agreement or any other Credit Document be a trustee for any Lender; (ii) shall not beresponsible to any Lender for any recitals, statements, representations or warranties contained inthis Agreement or any other Credit Document, or in any certificate or other document referred to orprovided for in, or received by any of them under, this Agreement or any other Credit Document, orfor the value, validity, effectiveness, genuineness, enforceability, execution, filing,registration, collectibility, recording, perfection, existence or sufficiency of this Agreement orany other Credit Document or any other document referred to or provided for herein or therein orany property covered thereby or for any failure by any Party or any other Person to perform any

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of its obligations hereunder or thereunder, and shall not have any duty to inquire into orpass upon any of the foregoing matters; (iii) shall not be required to initiate or conduct anylitigation or collection proceedings hereunder or any other Credit Document except to the extentrequested by the Majority Lenders; (iv) SHALL NOT BE RESPONSIBLE FOR ANY MISTAKE OF LAW OR FACT ORANY ACTION TAKEN OR OMITTED TO BE TAKEN BY IT HEREUNDER OR UNDER ANY OTHER CREDIT DOCUMENT OR ANYOTHER DOCUMENT OR INSTRUMENT REFERRED TO OR PROVIDED FOR HEREIN OR THEREIN OR IN CONNECTIONHEREWITH OR THEREWITH, INCLUDING, WITHOUT LIMITATION, PURSUANT TO ITS OWN NEGLIGENCE, BUT NOTINCLUDING AND EXCEPT FOR THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE AGENT; (v) shall not bebound by or obliged to recognize any agreement among or between the Borrower, the Agent, and anyLender other than this Agreement and the other Credit Documents, regardless of whether the Agenthas knowledge of the existence of any such agreement or the terms and provisions thereof; (vi)shall not be charged with notice or knowledge of any fact or information not herein set out orprovided to the Agent in accordance with the terms of this Agreement or any other Credit Document;(vii) shall not be responsible for any delay, error, omission or default of any mail, telegraph,cable or wireless agency or operator, and (viii) shall not be responsible for the acts or edicts ofany Governmental Authority. The Agent may employ agents and attorneys-in-fact and shall not beresponsible for the negligence or misconduct of any such agents or attorneys-in-fact selected by itwith reasonable care.

          (b) Without the prior written consent of Agent and all of the Lenders, Agent shall not (i)modify or amend in any respect whatsoever the interest rate provisions of the Credit Documents,(ii) increase the Commitment above $600,000,000.00 (provided that an increase requested inaccordance with Section 2.1(d) must only be approved by the Lenders that are increasingtheir Commitments), (iii) extend the Maturity Date other than in accordance with the expressprovisions of the Credit Documents, (iv) extend or reduce the due date for, or change the amountof, the scheduled payments of principal or interest on the Loans, the LC Disbursements or the feesset forth in Section 2.7, (v) amend the definitions of Majority Lenders or Super-MajorityLenders or any requirement that certain actions be taken only with the consent of a certain numberof the Lenders, (vi) amend or waive any provisions of Section 5.15 of this Agreement or(vii) release any Subsidiary from a Guaranty required under and delivered pursuant to Section5.15, unless the Guaranty is no longer required pursuant to Section 5.15. From time totime upon Agent’s request, each Lender shall execute and deliver such documents and instruments asmay be reasonably necessary to enable Agent to effectively administer and service the Loan in itscapacity as lead lender and servicer and in the manner contemplated by the provisions of thisAgreement.

          (c) Without the prior written consent of the Super-Majority Lenders, Agent shall not modify,amend or waive in any respect whatsoever the provisions of (i) Section 5.3 or thedefinitions of the financial covenants (or any component thereof) described in Section 5.3(any modification, amendment or waiver of the provisions of, or definitions relating to,Section 5.3(e) must also be approved by the Agent, the Syndication Agents and theDocumentation Agents), (ii) Section 5.11(c)(i), or (iii) Section 6.1.

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          (d) All information provided to the Agent under or pursuant to the Credit Documents, and allrights of the Agent to receive or request information, or to inspect information or Property, shallbe by the Agent on behalf of the Lenders. If any Lender requests that it be able to receive orrequest such information, or make such inspections, in its own right rather than through the Agent,the Borrower will cooperate with the Agent and such Lender in order to obtain such information ormake such inspection as such Lender may reasonably require.

          (e) The Borrower shall be entitled to rely upon a written notice or a written response fromthe Agent as being pursuant to concurrence or consent of the Majority Lenders or the Super-MajorityLenders unless otherwise expressly stated in the Agent’s notice or response.

     8.2 Reliance. The Agent shall be entitled to rely upon any certification, notice orother communication (including any thereof by telephone, telex, facsimile, telegram or cable)believed by it to be genuine and correct and to have been signed or sent by or on behalf of theproper Person or Persons, and upon advice and statements of legal counsel (which may be counsel forthe Borrower), independent accountants and other experts selected by the Agent. The Agent shallnot be required in any way to determine the identity or authority of any Person delivering orexecuting the same. As to any matters not expressly provided for by this Agreement or any otherCredit Document, the Agent shall in all cases be fully protected in acting, or in refraining fromacting, hereunder and thereunder in accordance with instructions of the Majority Lenders, and anyaction taken or failure to act pursuant thereto shall be binding on all of the Lenders. If anyorder, writ, judgment or decree shall be made or entered by any court affecting the rights, dutiesand obligations of the Agent under this Agreement or any other Credit Document, then and in any ofsuch events the Agent is authorized, in its sole discretion, to rely upon and comply with suchorder, writ, judgment or decree which it is advised by legal counsel of its own choosing is bindingupon it under the terms of this Agreement, the relevant Credit Document or otherwise; and if theAgent complies with any such order, writ, judgment or decree, then it shall not be liable to anyLender or to any other Person by reason of such compliance even though such order, writ, judgmentor decree may be subsequently reversed, modified, annulled, set aside or vacated.

     8.3 Defaults. The Agent shall not be deemed to have constructive knowledge of theoccurrence of a Default (other than the non-payment of principal of or interest on Loans) unless ithas received notice from a Lender or the Borrower specifying such Default and stating that suchnotice is a “Notice of Default”. In the event that the Agent receives such a notice of theoccurrence of a Default, or whenever the Agent has actual knowledge of the occurrence of a Default,the Agent shall give prompt written notice thereof to the Lenders (and shall give each Lenderprompt notice of each such non-payment). The Agent shall (subject to Section 8.7 hereof)take such action with respect to such Default as shall be directed by the Majority Lenders andwithin its rights under the Credit Documents and at law or in equity, provided that, unless anduntil the Agent shall have received such directions, the Agent may (but shall not be obligated to)take such action, or refrain from taking such action, permitted hereby with respect to such Defaultas it shall deem advisable

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in the best interests of the Lenders and within its rights under the Credit Documents in orderto preserve, protect or enhance the collectibility of the Loans, at law or in equity.

     8.4 Rights as a Lender. With respect to the Commitment and the Loans made, Agent, inits capacity as a Lender hereunder shall have the same rights and powers hereunder as any otherLender and may exercise the same as though it were not acting in its agency capacity, and the term“Lender” or “Lenders” shall, unless the context otherwise indicates, include the Agent in itsindividual capacity. The Agent may (without having to account therefor to any other Lender) as aLender, and to the same extent as any other Lender, accept deposits from, lend money to andgenerally engage in any kind of banking, trust, letter of credit, agency or other business with theBorrower (and any of its Affiliates) as if it were not acting as the Agent but solely as a Lender.The Agent may accept fees and other consideration from the Borrower (in addition to the feesheretofore agreed to between the Borrower and the Agent) for services in connection with thisAgreement or otherwise without having to account for the same to the Lenders.

     8.5 Indemnification. The Lenders agree to indemnify the Agent, its officers,directors, agents and Affiliates, ratably in accordance with each Lender’s respective Percentage,for any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits,costs, expenses or disbursements of any kind and nature whatsoever (INCLUDING BUT NOT LIMITED TO,THE CONSEQUENCES OF THE NEGLIGENCE OF THE AGENT) which may be imposed on, incurred by or assertedagainst the Agent in any way relating to or arising out of this Agreement or any other CreditDocument or any other documents contemplated by or referred to herein or therein, or thetransactions contemplated hereby or thereby (including, without limitation, interest, penalties,reasonable attorneys’ fees and amounts paid in settlement in accordance with the terms of thisSection 8, but excluding, unless a Default has occurred and is continuing, normaladministrative costs and expenses incident to the performance of its agency duties hereunder) orthe enforcement of any of the terms hereof or thereof or of any such other documents, INCLUDING BUTNOT LIMITED TO THE NEGLIGENCE OF THE AGENT, provided that no Lender shall be liable for any of theforegoing to the extent they arise from the gross negligence or willful misconduct of the party tobe indemnified, or from the Agent’s default in the express obligations of the Agent to the Lendersprovided for in this Agreement. The obligations of the Lenders under this Section 8.5shall survive the termination of this Agreement and the repayment of the Obligations.

     8.6 Non-Reliance on Agent and Other Lenders. Each Lender agrees that it has receivedcurrent financial information with respect to the Borrower and that it has, independently andwithout reliance on the Agent or any other Lender and based on such documents and information as ithas deemed appropriate, made its own credit analysis of the Borrower and decision to enter intothis Agreement and that it will, independently and without reliance upon the Agent or any otherLender, and based on such documents and information as it shall deem appropriate at the time,continue to make its own analysis and decisions in taking or not taking action under this Agreementor any of the other Credit Documents. The Agent shall not be required to keep itself informed asto the performance or observance by any Party of this Agreement or any of the other CreditDocuments or any other document referred to or provided for herein or therein or to inspect theproperties or

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books of the Borrower or any Party except as specifically required by the Credit Documents.Except for notices, reports and other documents and information expressly required to be furnishedto the Lenders by the Agent hereunder or the other Credit Documents, the Agent shall not have anyduty or responsibility to provide any Lender with any credit or other information concerning theaffairs, financial condition or business of the Borrower or any other Party (or any of theiraffiliates) which may come into the possession of the Agent. Each Lender assumes all risk of lossin connection with its Percentage in the Loans to the full extent of its Percentage therein. TheAgent assumes all risk of loss in connection with its Percentage in the Loans to the full extent ofits Percentage therein.

     8.7 Failure to Act. Except for action expressly required of the Agent, as the casemay be, hereunder, or under the other Credit Documents, the Agent shall in all cases be fullyjustified in failing or refusing to act hereunder and thereunder unless it shall receive furtherassurances to its satisfaction by the Lenders of their indemnification obligations underSection 8.5 hereof against any and all liability and expense which may be incurred by it byreason of taking or continuing to take any such action.

     8.8 Resignation of Agent. Subject to the appointment and acceptance of a successorAgent as provided below, the Agent may resign at any time by giving notice thereof to the Lendersand the Borrower. The Agent shall resign if it has assigned all of its Lender Commitment and Loansand is not an Issuing Bank. Upon any such resignation, (i) the Majority Lenders with the consentof the Borrower, so long as no Default is in existence, shall have the right to appoint a successorAgent so long as such successor Agent is also a Lender at the time of such appointment and (ii) theMajority Lenders shall have the right to appoint a successor Agent that is not a Lender at the timeof such appointment so long as the Borrower consents to such appointment (which consent shall notbe unreasonably withheld). If no successor Agent shall have been so appointed by the MajorityLenders and accepted such appointment within 30 days after the retiring Agent’s giving of notice ofresignation, then the retiring Agent may, on behalf of the Lenders, and with the consent of theBorrower which shall not be unreasonably withheld, appoint a successor Agent. Any successor Agentshall be a bank which has an office in the United States and a combined capital and surplus of atleast $500,000,000.00. Upon the acceptance of any appointment as Agent hereunder by a successorAgent, such successor Agent shall thereupon succeed to and become vested with all the rights,powers, privileges and duties of the retiring Agent, and the retiring Agent shall be dischargedfrom its duties and obligations as Agent thereafter arising hereunder and under any other CreditDocuments, but shall not be discharged from any liabilities for its actions as Agent prior to thedate of discharge. Such successor Agent shall promptly specify by notice to the Borrower itsprincipal office referred to in Section 2.1 and Section 2.3 hereof. After anyretiring Agent’s resignation hereunder as Agent, the provisions of this Section 8 shallcontinue in effect for its benefit in respect of any actions taken or omitted to be taken by itwhile it was acting as the Agent.

     8.9 No Partnership. Neither the execution and delivery of this Agreement nor any ofthe other Credit Documents nor any interest the Lenders, the Agent or any of them may now orhereafter have in all or any part of the Obligations shall create or be construed as creating apartnership, joint venture or other joint enterprise between the Lenders or

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among the Lenders and the Agent. The relationship between the Lenders, on the one hand, andthe Agent, on the other, is and shall be that of principals and agent only, and nothing in thisAgreement or any of the other Credit Documents shall be construed to constitute the Agent astrustee or other fiduciary for any Lender or to impose on the Agent any duty, responsibility orobligation other than those expressly provided for herein and therein.

9. Renewal and Extension.

     9.1 Procedure for Renewal and Extension. The Borrower may extend the Maturity Dateone (1) time by one (1) year by executing and delivering to the Agent a written request forextension (the “Extension Request”) at least thirty (30) days (but not more than ninety (90) days)prior to the Maturity Date.

     9.2 Conditions to Renewal and Extension. The extension of the Maturity Date underSection 9.1 of this Agreement shall be conditioned upon, among other things, the followingterms and conditions (which shall be in addition to those required by Sections 2.7,3 and 9.1 of this Agreement):

          (a) Execution by the Borrower of a renewal and extension agreement for each Note in ProperForm.

          (b) No Default must be in existence on the date of the Extension Request or on the MaturityDate (before extension).

          (c) Payment of the extension fee as set forth in Section 2.7(b).

          (d) Such other documents, instruments and items as Agent or any Lender shall reasonablyrequire to document extension.

10. Miscellaneous.

     10.1 No Waiver, Amendments. No waiver of any Default shall be deemed to be a waiverof any other Default. No failure to exercise or delay in exercising any right or power under anyCredit Document shall operate as a waiver thereof, nor shall any single or partial exercise of anysuch right or power preclude any further or other exercise thereof or the exercise of any otherright or power. Except as may be prohibited by Section 8.1 hereof, no amendment,modification or waiver of any Credit Document shall be effective unless the same is in writing andsigned by the Borrower and the Majority Lenders. No notice to or demand on the Borrower or anyother Person shall entitle the Borrower or any other Person to any other or further notice ordemand in similar or other circumstances.

     10.2 Notices. All notices under the Credit Documents shall be in writing and either(i) delivered against receipt therefor, or (ii) mailed by registered or certified mail, returnreceipt requested, in each case addressed as set forth herein, or to such other address as a partymay designate. Notices shall be deemed to have been given (whether actually received or not) whendelivered (or, if mailed, on the next Business Day). Provided, however, that as between the Agentand the Lenders and among the Lenders, notice may

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be given by telecopy or facsimile effective upon the earlier of actual receipt or confirmationof receipt by telephone.

     10.3 Venue. HARRIS COUNTY, TEXAS SHALL BE A PROPER PLACE OF VENUE TO ENFORCE PAYMENTOR PERFORMANCE OF THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS, UNLESS THE AGENT SHALL GIVE ITSPRIOR WRITTEN CONSENT TO A DIFFERENT VENUE. THE BORROWER HEREBY IRREVOCABLY SUBMITS TO THENONEXCLUSIVE JURISDICTION OF THE STATE AND FEDERAL COURTS IN THE STATE OF TEXAS AND AGREES ANDCONSENTS THAT SERVICE OF PROCESS MAY BE MADE UPON IT IN ANY PROCEEDING ARISING OUT OF ANY OF THECREDIT DOCUMENTS BY SERVICE OF PROCESS AS PROVIDED BY TEXAS LAW. THE BORROWER HEREBY IRREVOCABLYWAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TOTHE LAYING OF VENUE OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO ANY OF THECREDIT DOCUMENTS IN THE DISTRICT COURTS OF HARRIS COUNTY, TEXAS, OR IN THE UNITED STATES DISTRICTCOURT FOR THE SOUTHERN DISTRICT OF TEXAS, HOUSTON DIVISION, AND HEREBY FURTHER IRREVOCABLY WAIVESANY CLAIMS THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT INAN INCONVENIENT FORUM. THE BORROWER (A) AGREES TO DESIGNATE AND MAINTAIN AN AGENT FOR SERVICE OFPROCESS IN THE STATE OF TEXAS IN CONNECTION WITH ANY SUCH SUIT, ACTION OR PROCEEDING AND TO DELIVERTO THE AGENT EVIDENCE THEREOF AND (B) IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OFTHE AFOREMENTIONED COURTS IN ANY SUCH SUIT, ACTION OR PROCEEDING BY NOTICE GIVEN AS PROVIDED FOR INTHIS AGREEMENT. NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE AGENT OR THE LENDERS TO COMMENCELEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE BORROWER IN ANY JURISDICTION OR TO SERVE PROCESSIN ANY MANNER PERMITTED BY APPLICABLE LAW. THE BORROWER HEREBY IRREVOCABLY AGREES THAT ANY LEGALACTION OR PROCEEDING AGAINST THE AGENT OR ANY LENDER ARISING OUT OF OR IN CONNECTION WITH THISAGREEMENT OR THE OTHER CREDIT DOCUMENTS SHALL BE BROUGHT AND MAINTAINED IN THE DISTRICT COURTS OFHARRIS COUNTY, TEXAS, OR THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS,HOUSTON DIVISION.

     10.4 Choice of Law. THIS AGREEMENT, THE NOTES AND THE OTHER CREDIT DOCUMENTS HAVEBEEN NEGOTIATED, EXECUTED AND DELIVERED IN THE STATE OF TEXAS AND SHALL BE GOVERNED BY, ANDCONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF TEXAS, INCLUDING ALLAPPLICABLE FEDERAL LAW, FROM TIME TO TIME IN FORCE IN THE STATE OF TEXAS.

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     10.5 Survival; Parties Bound; Successors and Assigns.

          (a) All representations, warranties, covenants and agreements made by or on behalf of theBorrower in connection herewith shall survive the execution and delivery of the Credit Documents,shall not be affected by any investigation made by any Person, and shall bind the Borrower and itssuccessors, trustees, receivers and assigns and inure to the benefit of the successors and assignsof the Agent and the Lenders (including any Affiliate of the Issuing Bank that issues any Letter ofCredit); provided, however, that (i) the Borrower may not assign or transfer any of its rights orobligations hereunder without the prior written consent of the Agent and all of the Lenders, andany such assignment or transfer without such consent shall be null and void, and (ii) no Lender mayassign or otherwise transfer its rights or obligations hereunder except in accordance with thisSection. Nothing in this Agreement, expressed or implied, shall be construed to confer upon anyPerson (other than the parties hereto, their respective successors and assigns permitted hereby,participants (to the extent provided in paragraph (c) of this Section) and, to the extentexpressly contemplated hereby, the Affiliates of each of the Agent and the Lenders) any legal orequitable right, remedy or claim under or by reason of this Agreement.

          (b) (i) Subject to the conditions set forth in paragraph (b)(ii) below, any Lendermay assign to one or more assignees all or a portion of its rights and obligations under thisAgreement (including all or a portion of its Lender Commitment and the Loans at the time owing toit) with the prior written consent (such consent not to be unreasonably withheld) of:

     (A) the Borrower, provided that no consent of the Borrower shall be requiredif a Default has occurred and is continuing; and

     (B) the Agent.

     (ii) Assignments shall be subject to the following additional conditions:

     (A) except in the case of an assignment of the entire remaining amount of theassigning Lender’s Lender Commitment or Loans, the amount of the Lender Commitment or Loansof the assigning Lender subject to each such assignment (determined as of the date theAssignment and Assumption with respect to such assignment is delivered to the Agent) shallnot be less than $10,000,000 unless each of the Borrower and the Agent otherwise consent,provided that no such consent of the Borrower shall be required if a Default hasoccurred and is continuing;

     (B) each partial assignment shall be made as an assignment of a proportionate part ofall the assigning Lender’s rights and obligations under this Agreement;

     (C) the parties to each assignment shall execute and deliver to the Agent anAssignment and Assumption, together with a processing and recordation fee paid by theassigning Lender of $2,500; and

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     (D) the assignee, if it shall not be a Lender, shall deliver to the Agent anAdministrative Questionnaire.

          For the purposes of this Section 10.5, the term “Approved Fund” has thefollowing meaning:

          “Approved Fund” means any Person (other than a natural person) that is engaged inmaking, purchasing, holding or investing in bank loans and similar extensions of credit in theordinary course of its business and that is administered or managed by (a) a Lender, (b) anAffiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages aLender.

          (iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(iv) ofthis Section, from and after the effective date specified in each Assignment and Assumption theassignee thereunder shall be a party hereto and, to the extent of the interest assigned by suchAssignment and Assumption, have the rights and obligations of a Lender under this Agreement, andthe assigning Lender thereunder shall, to the extent of the interest assigned by such Assignmentand Assumption, be released from its obligations under this Agreement (and, in the case of anAssignment and Assumption covering all of the assigning Lender’s rights and obligations under thisAgreement, such Lender shall cease to be a party hereto but shall continue to be entitled to thebenefits of Sections 3.5, 5.10, 5.11 and 10.7). Any assignment or transfer by aLender of rights or obligations under this Agreement that does not comply with this Section shallbe treated for purposes of this Agreement as a sale by such Lender of a participation in suchrights and obligations in accordance with paragraph (c) of this Section.

          (iv) The Agent, acting for this purpose as an agent of the Borrower, shall maintain at one ofits offices, a copy of each Assignment and Assumption delivered to it and a register for therecordation of the names and addresses of the Lenders, and the Lender Commitment of, and principalamount of the Loans owing to each Lender pursuant to the terms hereof from time to time (the“Register”). The entries in the Register shall be conclusive, and Borrower, Agent, and theLenders may treat each Person whose name is recorded in the Register pursuant to the terms hereofas a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary.The Register shall be available for inspection by Borrower and any Lender, at any reasonable timeand from time to time upon reasonable prior notice.

          (v) Upon its receipt of a duly completed Assignment and Assumption executed by an assigningLender and an assignee, the assignee’s completed Administrative Questionnaire (unless the assigneeshall already be a Lender hereunder), the processing and recordation fee referred to inparagraph (b) of this Section and any written consent to such assignment required byparagraph (b) of this Section, the Agent shall accept such Assignment and Assumption andrecord the information contained therein in the Register. No assignment shall be effective forpurposes of this Agreement unless it has been recorded in the Register as provided in thisparagraph.

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          (c) A Lender may sell participating interests to an Affiliate of the Lender with writtennotice to the Agent and the Borrower but not any consent of the Agent, the Borrower or any otherLender, and may sell participating interests in any of its Loans to an Approved Fund so long assuch participation shall (1) limit the voting rights of the participant, if any, to the ability tovote for changes in the amount of the Commitment, the interest rate on the Loans, and the MaturityDate, (2) for the Committed Loans, if the participant is not an Affiliate of the participatingLender, require the written consent of the Borrower (so long as no Default is in existence) and theAgent, such consent not to be unreasonably withheld, (3) for Committed Loans be in a minimumprincipal amount of at least $10,000,000.00 if participated to a Person not already a Lender, and(4) not reduce the Lender’s Lender Commitment which has not been participated to less than$10,000,000.00. In connection with any sale of a participating interest made in compliance withthis Agreement, (i) the participating Lender shall continue to be liable for its Lender Commitmentand its other obligations under the Credit Documents, (ii) the Agent, the Borrower and the otherLenders shall continue to deal solely and directly with the participating Lender in connection withsuch Lender’s rights and obligations under the Credit Documents, and (iii) the participant may notrequire the participating Lender to take or refrain from taking any action under the CreditDocuments that is in conflict with the terms and provisions of the Credit Documents.

          (d) Notwithstanding any provision hereof to the contrary, (i) any Lender may assign and pledgeall or any portion of its Lender Commitment and Loans to a Federal Reserve Bank; provided, however,that any such assignment or pledge shall not relieve such Lender from its obligations under theCredit Documents; (ii) the Agent may not assign or participate its Lender Commitment so that itsLender Commitment after such assignment or participation is less than $15,000,000.00, to any Personother than an Affiliate of the Agent without the prior written consent of the Borrower, so long asno Default is in existence; and (iii) JPMC may assign, sell or participate all or any portion ofthe Swing Loan without the consent of the Borrower, the Agent or any other Lender.

          (e) The term of this Agreement shall be until the final maturity of the Notes and the paymentof all amounts due under the Credit Documents.

          (f) Any Lender (each, a “Designating Lender”) may at any time designate one Designated Lenderto fund Money Market Loans on behalf of such Designating Lender subject to the terms of thisSection 10.5(f), and the provisions in Sections 10.5(b) and (c) shall notapply to such designation. No Lender may designate more than one (1) Designated Lender. Theparties to each such designation shall execute and deliver to the Agent for its acceptance aDesignation Agreement. Upon such receipt of an appropriately completed Designation Agreementexecuted by a Designating Lender and a designee representing that it is a Designated Lender, theAgent will accept such Designation Agreement and will give prompt notice thereof to the Borrower,whereupon, (i) the Borrower shall execute and deliver to the Designating Lender a Designated LenderNote payable to the order of the Designated Lender, (ii) from and after the effective datespecified in the Designation Agreement, the Designated Lender shall become a party to thisAgreement with a right (subject to the provisions of Section 2.8(b)) to make Money MarketLoans on behalf of its Designating Lender pursuant to Section 2.8 after the Borrower has

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accepted a Money Market Loan (or portion thereof) of the Designating Lender, and (iii) theDesignated Lender shall not be required to make payments with respect to any obligations in thisAgreement except to the extent of excess cash flow of such Designated Lender which is not otherwiserequired to repay obligations of such Designated Lender which are then due and payable; provided,however, that regardless of such designation and assumption by the Designated Lender, theDesignating Lender shall be and remain obligated to the Borrower, Agent and the Lenders for eachand every obligation of the Designating Lender and its related Designated Lender with respect tothis Agreement, including, without limitation, any indemnification obligations under Section8.5 hereof and any sums otherwise payable to the Borrower by the Designated Lender. EachDesignating Lender shall serve as the administrative agent of the Designated Lender and shall onbehalf of, and to the exclusion of, the Designated Lender: (1) receive any and all payments madefor the benefit of the Designated Lender and (2) give and receive all communications and noticesand take all actions hereunder, including, without limitation, votes, approvals, waivers, consentsand amendments under or relating to this Agreement and the other Credit Documents. Any suchnotice, communication, vote, approval, waiver, consent or amendment shall be signed by theDesignating Lender as administrative agent for the Designated Lender and shall not be signed by theDesignated Lender on its own behalf, and shall be binding upon the Designated Lender to the sameextent as if signed by the Designated Lender on its own behalf. The Borrower, the Agent and theLenders may rely thereon without any requirement that the Designated Lender sign or acknowledge thesame. No Designated Lender may assign or transfer all or any portion of its interest hereunder orunder any other Credit Document, other than assignments to the Designating Lender which originallydesignated such Designated Lender or otherwise in accordance with the provisions of Sections10.5(b) and (c). The Agent and each Lender agrees that it will not institute againstany Designated Lender or join any other Person in instituting against any Designated Lender anybankruptcy, reorganization, arrangement, insolvency or liquidation proceeding under any federal orstate bankruptcy or similar law, until the later to occur of (x) one year and one day after thepayment in full of the latest maturing commercial paper note issued by such Designated Lender and(y) the Maturity Date.

     10.6 Counterparts. This Agreement may be executed in several identical counterparts,and by the parties hereto on separate counterparts, and each counterpart, when so executed anddelivered, shall constitute an original instrument, and all such separate counterparts shallconstitute but one and the same instrument.

     10.7 Usury Not Intended; Refund of Any Excess Payments. It is the intent of theparties in the execution and performance of this Agreement to contract in strict compliance withthe usury laws of the State of Texas and the United States of America from time to time in effect.In furtherance thereof, the Agent, the Lenders and the Borrower stipulate and agree that none ofthe terms and provisions contained in this Agreement or the other Credit Documents shall ever beconstrued to create a contract to pay for the use, forbearance or detention of money with interestat a rate in excess of the Ceiling Rate and that for purposes hereof “interest” shall include theaggregate of all charges which constitute interest under such laws that are contracted for,reserved, taken, charged or received under this Agreement. In determining whether or not theinterest paid or payable, under any specific contingency, exceeds the Ceiling Rate, the Borrower,the Agent and the

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Lenders shall, to the maximum extent permitted under applicable law, (a) characterize anynonprincipal payment as an expense, fee or premium rather than as interest, (b) exclude voluntaryprepayments and the effects thereof, and (c) “spread” the total amount of interest throughout theentire contemplated term of the Loans. The provisions of this paragraph shall control over allother provisions of the Credit Documents which may be in apparent conflict herewith.

     10.8 Captions. The headings and captions appearing in the Credit Documents have beenincluded solely for convenience and shall not be considered in construing the Credit Documents.

     10.9 Severability. If any provision of any Credit Documents shall be invalid,illegal or unenforceable in any respect under any applicable law, the validity, legality andenforceability of the remaining provisions shall not be affected or impaired thereby.

     10.10 Disclosures. Every reference in the Credit Documents to disclosures of theBorrower to the Agent and the Lenders in writing, to the extent that such references refer todisclosures at or prior to the execution of this Agreement, shall be deemed strictly to refer onlyto written disclosures delivered to the Agent and the Lenders in an orderly manner concurrentlywith the execution hereof.

     10.11 No Novation. THE PARTIES HERETO HAVE ENTERED INTO THIS AGREEMENT AND THE OTHERCREDIT DOCUMENTS SOLELY TO AMEND, RESTATE AND RESTRUCTURE THE TERMS OF, AND THE OBLIGATIONS OWINGUNDER AND IN CONNECTION WITH, THE CREDIT AGREEMENT DATED OCTOBER 30, 2003 AMONG THE BORROWER, THEAGENT AND CERTAIN OF THE LENDERS. THE PARTIES DO NOT INTEND THIS AGREEMENT NOR THE TRANSACTIONSCONTEMPLATED HEREBY TO BE, AND THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY SHALL NOT BECONSTRUED TO BE, A NOVATION OF ANY OF THE OBLIGATIONS OWING BY THE BORROWER UNDER OR IN CONNECTIONWITH THE SAID CREDIT AGREEMENT.

     10.12 Limitation of Liability. NO OBLIGATION OR LIABILITY WHATSOEVER OF THE BORROWERWHICH MAY ARISE AT ANY TIME UNDER THIS AGREEMENT OR ANY OBLIGATION OR LIABILITY WHICH MAY BEINCURRED BY IT PURSUANT TO ANY OTHER CREDIT DOCUMENT SHALL BE PERSONALLY BINDING UPON, NOR SHALLRESORT FOR THE ENFORCEMENT THEREOF BE HAD TO THE PRIVATE PROPERTY OF, ANY OF THE BORROWER’STRUSTEES OR SHAREHOLDERS REGARDLESS OF WHETHER SUCH OBLIGATION OR LIABILITY IS IN THE NATURE OFCONTRACT, TORT OR OTHERWISE.

     10.13 Entire Agreement. THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS TOGETHERCONSTITUTE A WRITTEN AGREEMENT AND REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BECONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS

62


 

OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEENTHE PARTIES.

63


 

          IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date set forthabove.

         
  ARCHSTONE-SMITH OPERATING TRUST
 
 
  By:    
  Name:    
  Title:    
 
     
  Address:
  9200 E. Panorama Circle
  Suite 400
  Englewood, Colorado 80112
  Attention: Corporate Finance

The Parent joins in the execution of this Agreement to evidence its agreement to the provisions ofSections 5.2, 5.11(b) and (c), and 6.6 of this Agreement.

         
  ARCHSTONE — SMITH TRUST
 
 
  By:      
  Name:    
  Title:    

64


 

         
     
Lender Commitment: $38,000,000.00
  JPMORGAN CHASE BANK, N.A.,
Percentage: 6.333333333%
  as Agent and as a Lender
         
     
  By:      
  Name:    
  Title:    
     
  Address:
  712 Main Street
  Houston, Texas 77002
  Attention: Manager, Real Estate Group
         
  Telecopy No.:   713/216-7713
  Telephone No.:   Kent Kaiser
      713/216-8699

 


 

     
Lender Commitment: $38,000,000.00
  BANK OF AMERICA, N.A.
Percentage: 6.333333333%
   
         
     
  By:      
  Name:    
  Title:    
 
     
  Address:
  901 Main Street, 64th Floor
  Dallas, Texas 75202
  Attention: Charlotte Wai Deinhart
 
   
  Telephone No.: 214/209-9129
  Telecopy No.: 214/209-0996

 


 

     
Lender Commitment: $38,000,000.00
  WELLS FARGO BANK, NATIONAL
Percentage: 6.333333333%
  ASSOCIATION
         
     
  By:      
  Name:    
  Title:    
 
     
  Address:
  4643 S. Ulster Street
  Suite 1400
  Denver, Colorado 80237
  Attention: Martia Kontak
 
   
  Telephone No.: 303/741-0800 X208
  Telecopy No.: 303/741-0867

 


 

     
Lender Commitment: $38,000,000.00
  COMMERZBANK AG, NEW YORK AND
Percentage: 6.333333333%
  GRAND CAYMAN BRANCHES
         
     
  By:      
  Name:    
  Title:    
 
         
     
  By:      
  Name:    
  Title:    
 
     
  Address:
  Commerzbank AG, New York Branch
  2 World Financial Center
  New York, New York 10281-1050
  Attention: David Goldman
 
   
  Telephone No.: 212/266-7457
  Telecopy No.: 212/266-7565

 


 

     
Lender Commitment: $38,000,000.00
  SUNTRUST BANK
Percentage: 6.333333333%
   
         
     
  By:      
  Name:    
  Title:    
 
     
  Address:
  8330 Boone Blvd., 8th Floor
  Vienna, Virginia 22182-2624
  Attention: Gregory T. Horstman
         
  Telephone No.:   703/442-1549
  Telecopy No.:   703/442-1570

 


 

     
Lender Commitment: $35,000,000.00
  PNC BANK, NATIONAL ASSOCIATION
Percentage: 5.833333333%
   
         
  By:      
  Name:    
  Title:    
 
     
  Address:
  One PNC Plaza
  Mail Stop PL-POPP-19-2
  Pittsburgh, Pennsylvania 15222
  Attention: James Collella
 
   
  Telephone No.: 412/762-2260
  Telecopy No.: 412/762-6500

 


 

     
Lender Commitment: $35,000,000.00
  U.S. BANK NATIONAL ASSOCIATION
Percentage: 5.833333333%
   
         
  By:      
  Name:    
  Title:    
 
     
  Address:
  918 17th Street, 5th Floor
  Denver, Colorado 80203
  Attention: Leanne Toler
 
   
  Telephone No.: 303/585-4172
  Telecopy No.: 303/585-4199

 


 

         
Lender Commitment: $35,000,000.00   CITICORP NORTH AMERICA, INC.
Percentage: 5.833333333%
       
 
       
  By:    
     
  Name:    
     
  Title:    
     
 
       
  By:    
     
  Name:    
     
  Title:    
     
 
       
    Address:
    390 Greenwich Street
    New York, New York 10013
    Attention: Mr. Blake Gronich
 
       
    Telephone No.: 212/723-6590
    Telecopier No.: 212/723-8548

 


 

         
Lender Commitment: $10,000,000.00   SCOTIABANC, INC.
Percentage: 1.666666667%
       
 
       
  By:    
     
  Name:    
     
  Title:    
     
 
       
    Address:
    600 Peachtree Street, Suite 2700
    Atlanta, Georgia 30308
    Attention: Bill Zarrett
 
       
    Telephone No.: 404/877-1504
    Telecopy No.: 404/888-8998
 
       
Lender Commitment: $25,000,000.00   THE BANK OF NOVA SCOTIA
Percentage: 4.166666666%
       
 
       
  By:    
     
  Name:    
     
  Title:    
     
 
       
    Address:
    580 California Street, Suite 2100
    San Francisco, California 94104
    Attention: Mark Sparrow
 
       
    Telephone No.: 415/646-4108
    Telecopy No.: 415/397-0791

 


 

         
Lender Commitment: $35,000,000.00   KEYBANK NATIONAL ASSOCIATION
Percentage: 5.833333333%
       
 
       
  By:    
     
    Name: Donald Woods
    Title: Asst Vice President
 
       
    Address:
    127 Public Square, 8th Floor
    Cleveland, OH 44114
    Attention: Scott Childs
 
       
    Telephone No.: 216-689-7547
    Telecopy No.: 216-689-4997

 


 

         
Lender Commitment: $27,000,000.00   CITIZENS BANK OF RHODE ISLAND
Percentage: 4.500000000%
       
 
       
  By:    
     
  Name:    
     
  Title:    
     
 
       
    Address:
    One Citizens Plaza (RC0440)
    Providence, Rhode Island 02903
    Attention: Craig E. Schermerhorn
 
       
    Telephone No.: 401/455-5425
    Telecopy No.: 401/282-4485

 


 

         
Lender Commitment: $27,000,000.00   LASALLE BANK NATIONAL
Percentage: 4.500000000%   ASSOCIATION
 
       
  By:    
     
  Name:    
     
  Title:    
     
 
       
    Address:
    135 South LaSalle Street
    Chicago, Illinois 60603
    Attention: Jay Palmer
 
       
    Telephone No.: 312/904-7211
    Telecopy No.: 312/904-6691

 


 

         
Lender Commitment: $27,000,000.00   MORGAN STANLEY BANK
Percentage: 4.500000000%
       
 
       
  By:    
     
  Name:    
     
  Title:    
     
 
       
    Address:
    750 Seventh Avenue, 11th Floor
    New York, New York 10020
    Attention: Christopher Whelan
 
       
    Telephone No.: 212/762-2929
    Telecopy No.: 212/762-0346

 


 

         
Lender Commitment: $27,000,000.00   UNION BANK OF CALIFORNIA, N.A.
Percentage: 4.500000000%
       
 
       
  By:    
     
  Name:    
     
  Title:    
     
 
       
    Address:
    350 California Street, 7th Floor
    San Francisco, California 94120
    Attention: Karen Kokame
 
       
    Telephone No.: 415/705-7116
    Telecopy No.: 415/433-7438

 


 

         
Lender Commitment: $27,000,000.00   BANK OF CHINA, NEW YORK BRANCH
Percentage: 4.500000000%
       
 
       
  By:    
     
  Name:    
     
  Title:    
     
 
       
    Address:
    410 Madison Avenue
    New York, New York 10017
    Attention: Joseph Zeng/David Hoang
 
       
    Telephone No.: 212/935-3101 X408/X229
    Telecopy No.: 212/308-4993

 


 

         
Lender Commitment: $20,000,000.00   LEHMAN BROTHERS BANK, FSB
Percentage: 3.333333333%
       
 
       
  By:    
     
  Name:    
     
  Title:    
     
 
       
    Address:
    745 Seventh Avenue, 7th Floor
    New York, New York 10019
    Attention: Janine Shugan
 
       
    Telephone No.: 212/526-8625
    Telecopy No.: 201/508-4654

 


 

         
Lender Commitment: $20,000,000.00   MANUFACTURERS AND TRADERS
Percentage: 3.333333333%   TRUST COMPANY
 
       
  By:    
     
  Name:    
     
  Title:    
     
 
       
    Address:
    Mail Code 101-747
    25 South Charles Street, 17th Floor
    Baltimore, Maryland 21201
    Attention: D. Stewart Cooper
 
       
    Telephone No.: 410/545-2368
    Telecopy No.: 410/545-2385

 


 

         
Lender Commitment: $10,000,000.00
Percentage: 1.666666667%
  UFJ BANK LIMITED
 
       
  By:    
     
  Name:    
     
  Title:    
     
 
       
    Address:
    55 East 52nd Street
    New York, New York 10055
    Attention: Douglas E. Crater
 
       
    Telephone No.: 212/339-6233
    Telecopy No.: 212/754-1304

 


 

         
Lender Commitment: $10,000,000.00   CHANG HWA COMMERCIAL BANK, LTD.
Percentage: 1.666666667%
       
 
       
  By:    
     
  Name:    
     
  Title:    
     
 
       
    Address:
    685 Third Avenue, 29th Floor
    New York, New York 10017
    Attention: Melody Tsou
 
       
    Telephone No.: 212/651-9770 X28
    Telecopy No.: 212/651-9785

 


 

         
Lender Commitment: $10,000,000.00   THE GOVERNOR AND COMPANY OF
Percentage: 1.666666667%   THE BANK OF IRELAND
 
       
  By:    
     
  Name:    
     
  Title:    
     
 
       
  By:    
     
  Name:    
     
  Title:    
     
 
       
    Address:
    Bank of Ireland Corporate
    La Touche House
    International Financial Services Centre
    Custom House Docks
    Dublin 1, Ireland
    Attention: Philip Allen
 
       
    Telephone No.: 00 353 1 611 5406
    Telecopy No.: 00 353 1 829 0129

 


 

         
Lender Commitment: $10,000,000.00   CHEVY CHASE BANK, F.S.B.
Percentage: 1.666666667%
       
 
       
  By:    
     
  Name:    
     
  Title:    
     
 
       
    Address:
    7501 Wisconsin Avenue, 12th Floor
    Bethesda, Maryland 20814
    Attention: Carlos L. Heard
 
       
    Telephone No.: 240/497-7758
    Telecopy No.: 240/497-7714

 


 

         
Lender Commitment: $10,000,000.00   FIRST HORIZON BANK, A DIVISION OF
Percentage: 1.666666667%   FIRST TENNESSEE BANK N.A.
 
       
  By:    
     
  Name:    
     
  Title:    
     
 
       
    Address:
    1650 Leesburg Pike, Suite 1650
    McLean, Virginia 22102
    Attention: Stephanie A. Carey
 
       
    Telephone No.: 703/394-2506
    Telecopy No.: 703/394-2644

 


 

         
Lender Commitment: $10,000,000.00   COMPASS BANK, an Alabama banking
Percentage: 1.666666667%   corporation
 
       
  By:    
     
  Name:    
     
  Title:    
     
 
       
    Address:
    15 South 20th Street, 15th Floor
    Birmingham, Alabama 35233
    Attention: Johanna Duke Paley
 
       
    Telephone No.: 205/297-3851
    Telecopy No.: 205/297-7994

 


 

SCHEDULE I

Ameriton Properties Incorporated
API Cameron Park LLC
API Genesis Park LLC
ASN Bowie LLC
ASN Cambridge LLC
ASN City Place LLC
ASN Dakota Ridge LLC
ASN Doral West LLC
ASN Dupont Circle LLC
ASN Estancia LLC
ASN Fairfax Corner LLC
ASN Gresham Commons LLC
ASN Hoboken I LLC
ASN Hoboken II LLC
ASN Lakeshore East LLC
ASN Marina Del Rey LLC
ASN Northgate, LLC
ASN Palm Trace Landings, LLC
ASN Park Essex LLC
ASN Richardson Highlands LLC
ASN Rockville LLC
ASN Roosevelt Center LLC
ASN Santa Monica LLC
ASN Saybrooke LLC
ASN Studio City LLC
ASN Sussex Commons LLC
ASN Ventura LLC
ASN Warner Center, LLC
ASN Washington Boulevard LLC
ASN Watertown LLC
ASN Wendemere, LLC
ASN-Massachusetts Holdings (2) LLC
ASN-Massachusetts Holdings (4) LLC
ASN-Massachusetts Holdings (5) LLC
ASN-Washington Holdings (1) LLC
Courthouse Hill LLC
First Herndon Associates Limited Partnership
Hacienda Cove, LLC
Interlocken Apartments LLC
PTR-California Holdings (1) LLC
PTR-California Holdings (3) LLC
SCA Florida Holdings (2) LLC
SCA North Carolina Limited Partnership









































 


 

Security Capital Atlantic Multifamily LLC
Smith Property Holdings 4411 Connecticut L.L.C.
Smith Property Holdings Four LP
Smith Property Holdings Harbour House L.L.C.
Smith Property Holdings Illinois Center LLC
Smith Property Holdings Lincoln Towers LLC
Smith Property Holdings One East Delaware LLC
Smith Property Holdings One L.P.
Smith Property Holdings Reston Landing L.L.C.
Smith Property Holdings Seven L.P.
Smith Property Holdings Six L.P.
Smith Property Holdings Superior Place L.L.C.
Smith Property Holdings Two (D.C.) L.P.
Smith Property Holdings Two L.P.
St. Andrews at Kings Point, Tamarac, Ltd.
TRG-Pembroke Road, LLC














2


 

OFFICER’S CERTIFICATE

     Archstone-Smith Operating Trust (the “Borrower”), Archstone-Smith Trust (the “Parent”),JPMorgan Chase Bank, N.A. (“JPMC”), Wells Fargo Bank, N.A. and Bank of America, N.A., as Agents(the “Agents”) and certain other Lenders (the “Lenders”) entered into that certain Amended andRestated Credit Agreement (the “Agreement”) dated as of December 13, 2004, as the same may beamended. Any term used herein and not otherwise defined shall have the meaning ascribed to it inthe Agreement.

    The undersigned hereby certifies that:
 
I.   I am a Vice President of the Borrower and a Vice President of the Parent, and I make thesecertifications on behalf of the Borrower or the Parent, as applicable.
 
II.   The Parent’s financial statements as of                      as filed with the Securities and ExchangeCommission (“SEC”), and the Borrower’s financial statements as of                      delivered toJPMC, were prepared in conformity with generally accepted accounting principles consistentlyapplied and present fairly the financial position of the Parent and of the Borrower,respectively, as of the date thereof and the results of its operations for the period coveredthereby subject to normal year-end adjustments.
 
III.   Borrower hereby certifies the following as of the end of the period covered by the financialstatements described above:
                     
    1.     Maximum Debt to Total Asset Value Ratio Calculation        
          (Section 5.3 (e))        
 
                   
    (A )   Indebtedness (Borrower and Parent)        
          Total Unsecured Debt (per GAAP)   $                    
          Total Secured Debt (per GAAP)   $                    
          Guarantees, Endorsements and Other Contingent Obligations   $                    
          Obligations under Hedging Agreements, as defined   $                    
          Equity Percentage of Indebtedness of Unconsolidated Affiliates   $                    
          Other (pursuant to the Agreement)   $                    
          Total Indebtedness, as defined   $                    
 
    (B )   Total Asset Value:        
          Aggregated Net Operating Income from Stabilized Properties        
          Divided by 7.50%   $                    
          Historical Value of Pre-Stabilized Properties   $                    
          Historical Value of Properties Under Construction   $                    
          Historical Value of Undeveloped Land   $                    
          Other Assets (excluding intangibles as defined by GAAP)   $                    
          Total Asset Value of Unconsolidated Affiliates   $                    
 
                   
Page 1 of 7 Pages
EXHIBIT A

 


 

                     
          Total Asset Value, as defined   $                    
 
                   
    (C )   Maximum Debt to Total Asset Value (Ratio of 1(A) to 1(B))        
          Required: Maximum:     60 %
 
                   
    2.     Maximum Secured Debt Calculation        
          (Section 5.3 (a))        
 
                   
          (A) Secured Debt, as defined   $                    
          (B) Total Asset Value, as defined   $                    
          (C) Maximum Secured Debt to Total Asset Value        
          (Ratio of 2(A) to 2(B))                       
          Required:Maximum:     40 %
 
                                  
 
                   
    3.     Coverage Ratio Calculation        
          (Section 5.3 (b))        
 
                   
    (A )   Borrower’s EBITDA:        
          Net Income (per GAAP)   $                    
          Plus:        
          Depreciation and Amortization (per GAAP)   $                    
          Interest Expense, as defined, of Borrowerand Parent   $                    
          Income Taxes (per GAAP)   $                    
          Extraordinary Gains/Losses (per GAAP)   $                    
          Payments on Borrower’s Preferred Stock (tothe extent included in net income)   $                    
          Equity Percentage of EBITDA for   $                    
          Unconsolidated Affiliates   $                    
          Other (pursuant to the Agreement)   $                    
          Borrower’s EBITDA, as defined   $                    
 
                   
    (B )   Dividends and Distributions Paid with Respect to DisqualifiedStock   $                    
 
                   
    (C )   Interest Expense, as defined, of Borrower and Parent   $                    
 
                   
    (D )   Sum of 3(B) and 3(C)   $                    
 
                   
    (E )   Coverage Ratio (Ratio of 3(A) to 3(D)):     1.0  
 
                                  
 
                   
          Required:   Minimum of 2.0 to 1.0
 
                   
    4.     Fixed Charge Coverage Ratio Calculation        
          (Section 5.3(c))        
 
                   
    (A )   Borrower’s EBITDA, as defined   $                    
 
                   
    (B )   Unit Capital Expenditures   $                    
 
                   
    (C )   EBITDA minus Unit Capital Expenditures   $                    
 
                   
Page 2 of 7 Pages
EXHIBIT A

 


 

                     
    (D )   Interest Expense, as defined, of Borrower and Parent   $                    
 
                   
    (E )   Payments and Payables on Disqualified Stock   $                    
 
                   
    (F )   Regularly Scheduled Principal Paid and Payable(Borrower and Parent)   $                    
 
                   
    (G )   Sum of 4(D), 4(E) and 4(F)   $                    
 
                   
    (H )   Fixed Charge Coverage Ratio (Ratio of 4(C) to 4(G))     1.0  
 
                                  
 
                   
          Required:   Minimum of 1.75 to 1.0
 
                   
    5.     Tangible Net Worth        
          (Section 5.3(d))        
          Assets   $                    
          Liabilities   $                    
          Tangible Net Worth, as defined   $                    
 
                   
          Required:   Minimum of $3.500 billion
 
                   
    6.     Property Pool        
          (Section 5.15)        
 
                   
    (A )   Sum of the Aggregate Net Operating Income for Pool Real EstateThat Has Reached the Stabilization Date Divided by 7.50% and theAggregate Historical Value for Pool Real Estate That Has NotReached the Stabilization Date   $                    
 
                   
    (B )   Outstanding Unsecured Indebtedness   $                    
 
                   
    (C )   Pool Value Divided by Outstanding Unsecured        
          Indebtedness (6(A) divided by 6(B))                       %
 
                   
    Required:   Minimum of 167%
 
                   
 
                   
    (D )   Pool Value attributable to unimproved land (Maximum-5%)   $                    
 
                   
    (E )   Pool Value attributable to unimproved land, land underconstruction or development, projects that do not have 80%Occupancy Level, non-multifamily land, land that has notreached the Calculation Date (Maximum-25%)   $                    
 
                   
    (F )   Pool Value attributable to improved property that is notmultifamily residential (Maximum-10%)   $                    
 
                   
    (G )   The Borrower confirms that it has received theenvironmental assessments required bySection 5.15(a)(i)                       
 
                   
    7.     Specified Permitted Holdings        
          (Section 6.3)        
 
                   
Page 3 of 7 Pages
EXHIBIT A

 


 

                     
    (A )   Securities Received in Settlement Liabilities Created in theOrdinary Course of Business                       
          (Maximum – 5%)        
 
                   
    (B )   Unconsolidated Affiliates Engaged in Permitted Businesses                       
          (Maximum – 20%)        
 
                   
    (C )   Loans to Unaffiliated Persons                       
          (Maximum – 10%)        
 
                   
    (D )   Other Securities                       
          (Maximum – 10%)        
 
                   
    (E )   Income Producing Properties That Are Not Multifamily
Residential
                      
          (Maximum – 10%)        
 
                   
    (F )   Unimproved Land                       
          (Maximum – 7.5%)        
 
                   
    (G )   Unrelated, Non-Incidental Investments                       
          (Maximum – 5%)        
 
                   
    (H )   Aggregate Value of the specified Permitted Holdings(sum of 7(A) through 7(H))                       
          (Maximum – 30%)        
IV.   A review of the activities of the Borrower during the period covered by the financialstatements has been made under my supervision and with a view to determining whether duringsuch period the Borrower has kept, observed, performed and fulfilled all of its obligationsunder the Agreement.
 
    The Parent has made available its financial statements and related footnotes for the mostrecent period ended                     , as filed with the SEC and can be accessed athttp://www.sec.gov/. The Borrower has delivered to JPMC its financial statements andrelated footnotes for the most recent period ended                     . The Parent’s and theBorrower’s earnings press releases and supplemental information for such period have beenposted to the Parent’s website (                                        ). The financial statementswere prepared in conformity with generally accepted accounting principles consistentlyapplied (except for the omission of footnote disclosures and appropriately disclosedconsistency exceptions) and present fairly the financial position of the Parent and theBorrower, respectively, as of the date thereof and the results of its operations for theperiod covered thereby subject to normal year-end adjustments.
 
V.   (Check either (A) or (B))
         
  o   (A) The Borrower has kept, observed, performed and fulfilled each andevery one of its obligations under the Agreement during the period covered by theapplicable financial statements.
 
       
Page 4 of 7 Pages
EXHIBIT A

 


 

         
  o   (B) The Borrower has kept, observed, performed and fulfilled each andevery one of its obligations under the Agreement during the period covered by theapplicable financial statements except for the following matters: [Describe all suchdefaults, specifying the nature, duration and status thereof and what action theBorrower has taken or proposes to take with respect thereto].
VI.   With regard to Section 1004 of the Indenture dated as of February 1, 1994 between the Borrower and MorganGuaranty Trust Company of New York, as Trustee (and using the terms defined therein), a certificate requiredthereunder showing compliance with Section 1004 is attached (only required for the fourth quarter Officer’sCertificate), for the most recent period ended                      :
                     
    1.     (A)   Sum of Total Assets, Aggregate Purchase Price of RealEstate Assets, or Mortgages Receivable Acquired, andSecurities Offering Proceeds Received to Purchasesaid Assets   $                    
 
                   
          (B)   Maximum amount of Debt   $                    
 
                   
          (C)   Debt   $                    
 
                   
    2.     (A)   Consolidated Income Available for Debt Service   $                    
 
                   
          (B)   Annual Service Charge   $                    
 
                   
          (C)   Ratio of Consolidated Income Available for Debt    
              Service to Annual Service Charge                         
 
                   
    3.     (A)   Total Assets   $                    
 
                   
          (B)   Maximum Secured Debt   $                    
 
                   
          (C)   Secured Debt   $                    
VII.   The Parent hereby certifies the following as to itself as of the end ofthe period covered by the financial statements dated                      asfiled with the SEC:
                 
    1.     Indebtedness   $                    
 
               
                                                      
    2.     Interest Expense   $                    
VIII.   Check either (A) or (B)
         
  o   (A) The Parent has kept, observed, performed and fulfilled each and everyone of its obligations under the Agreement during the period covered by the applicablefinancial statements.
 
       
  o   (B) The Parent has kept, observed, performed and fulfilled each and everyone of its obligations under the Agreement during the period covered by the applicablefinancial statements except for the following matters:
 
       
Page 5 of 7 Pages
EXHIBIT A

 


 

         
      [Describe all such defaults, specifying the nature, duration and status thereof andwhat action the Parent has taken or proposes to take with respect thereto].
             
Date:
      Name:    
 
     
               [Vice President Name]

(A manually signed Officer’s Certificate is available at the request of any Agent or Lender.)

Page 6 of 7 Pages
EXHIBIT A

 


 

POOL PROPERTY LIST

     List each property separately showing the Historical Value and the components, the city, thestate, the Occupancy Level for the past three months, the number of units, the age of the propertyand net operating income.

Page 7 of 7 Pages
EXHIBIT A


 

REQUEST FOR LOAN

Date:                                         , 2004

JPMorgan Chase Bank, N.A.
712 Main Street
Houston, Texas 77002
(“Agent”)


         
  RE:   Request for Loan Under Amended and Restated Credit Agreement (as
      amended from time to time, the “Credit Agreement”) dated as of
      December 13, 2004, among Archstone-Smith Operating Trust (the “Borrower”),
      the Agent and the Lenders as signatory to the Credit Agreement

Gentlemen:

     Borrowerhereby requests [check as applicable]  a conversion of an existing Loan as providedbelow, and/or  an advance under the Credit Agreement, which is allowed pursuant to Section 5.9 ofthe Credit Agreement, in the amount of $___[minimum of $1,000,000.00 and in multiples of$100,000.00].

         
Maximum Principal Amount
  $ 600,000,000.00  
 
       
Less the amount outstanding under the
       
Credit Agreement (including Swing Loans
       
and Money Market Loans)
  ($                    .___)
Less the LC Exposure
  ($                    .___)
 
       
Less the LC Exposure
  ($                    .___)
 
       
Available amount
  ($                    .___)
 
       
Less amount requested
  ($                    .___)
 
       
Amount remaining to be advanced
  $                    .___

Page 1 of 3 Pages
EXHIBIT B

 


 

The advance or conversion is to be made as follows:

         
A.
  Base Rate Borrowing.    
 
       
  1. Amount of Base Rate Borrowing:   $                    .___
 
 
  2. Date of Base Rate Borrowing                       ,20___
 
       
B.
  Eurodollar Rate Borrowing:    
 
       
  1. Amount of Eurodollar Rate    
      Borrowing:   $                    .___
 
       
  2. Amount of conversion of existing    
      Loan to Eurodollar Rate Borrowing:   $                    .___
 
       
  3. Number of Eurodollar Rate    
      Borrowing(s) now in effect:                                 
      [cannot exceed 12]    
 
       
  4. Date of Eurodollar Rate Borrowing    
      or conversion:                       ,20___
 
       
  5. Interest Period:                                   
 
       
  6. Expiration date of current Interest    
      Period as to this conversion:                       , 20___
 
       
C.
  Swing Loan.    
 
       
  1. Amount of Swing Loan:   $                    ,___
      [minimum of $1,000,000.00 and in    
      multiples of $100,000.00]    
 
       
  2. Date of Swing Loan:                       ,20___

Page 2 of 3 Pages
EXHIBIT B

 


 

     Borrower hereby represents and warrants that the amounts set forth above are true and correct,that the amount above requested has actually been incurred, that the representations and warrantiescontained in the Credit Agreement are true and correct as if made as of this date, and thatBorrower has kept, observed, performed and fulfilled each and every one of its obligations underthe Credit Agreement as of the date hereof [except as follows:]

             
    Very truly yours,    
 
           
    ARCHSTONE-SMITH OPERATING TRUST    
 
           
  By:        
           
  Name:        
           
  Title:        
           

Page 3 of 3 Pages
EXHIBIT B

 


 

     
$[                    ]
                      ,2004

     FOR VALUE RECEIVED ARCHSTONE-SMITH OPERATING TRUST, a Maryland real estate investment trust(herein called “Maker”) promises to pay to the order of[                                                                                                    ], a [                                                            ] Payee”), at the officesof JPMorgan Chase Bank, N.A., as “Agent” under the Credit Agreement, at 712 Main Street,Houston, Texas 77002, or at such other place as the holder (the “Holder”, whether or notPayee is such holder) of this note may hereafter designate in writing, in immediately availablefunds and in lawful money of the United States of America, the principal sum of[                                                                                ] Dollars ($[                                        ]) (or the unpaid balance of allprincipal advanced against this note, if that amount is less), together with interest on the unpaidprincipal balance of this note from time to time outstanding at the Stated Rate and interest on allpast due amounts, both principal and accrued interest, at the Past Due Rate; provided, thatfor the full term of this note the interest rate produced by the aggregate of all sums paid oragreed to be paid to the Holder of this note for the use, forbearance or detention of the debtevidenced hereby (including, but not limited to, all interest on this note at the Stated Rate)shall not exceed the Ceiling Rate.

     1. Definitions. Any terms not defined herein shall have the meaning given to them in theAmended and Restated Credit Agreement dated of even date herewith among the Maker, the Agent andcertain other Lenders (as the same may be amended or modified the “Credit Agreement”).

     2. Rates Change Automatically and Without Notice. Without notice to Maker or any other personor entity and to the full extent allowed by applicable law from time to time in effect, the PrimeRate and the Ceiling Rate shall each automatically fluctuate upward and downward as and in theamount by which Agent’s said prime rate, and such maximum nonusurious rate of interest permitted byapplicable law, respectively, fluctuate.

     3. Calculation of Interest. Interest shall be computed for the actual number of days elapsedin a year (up to 365, or 366 in a leap year) deemed to consist of 360 days, unless the Ceiling Ratewould thereby be exceeded, in which event, to the extent necessary to avoid exceeding the CeilingRate, interest shall be computed on the basis of the actual number of days elapsed in theapplicable calendar year in which it accrued.

     4. Excess Interest Will be Refunded or Credited. If, for any reason whatever, the interestpaid or received on this note during its full term produces a rate which exceeds the Ceiling Rate,the Holder of this note shall refund to the payor or, at the Holder’s option, credit against theprincipal of this note such portion of that interest as shall be necessary to cause the interestpaid on this note to produce a rate equal to the Ceiling Rate.

Page 1 of 5 Pages
EXHIBIT C

 


 

     5. Interest Will be Spread. All sums paid or agreed to be paid to the Holder of this note forthe use, forbearance or detention of the indebtedness evidenced hereby, to the extent permitted byapplicable law and to the extent necessary to avoid violating applicable usury laws, shall beamortized, prorated, allocated and spread in equal parts throughout the full term of this note, sothat the interest rate is uniform throughout the full term of this note.

     6. Payment Schedule. The principal of this note shall be due and payable on the MaturityDate. Accrued and unpaid interest shall be due and payable on each Interest Payment Date.

     7. Prepayment. Maker may prepay this note only as provided in the Credit Agreement.

     8. Revolving Credit. Upon and subject to the terms and conditions of the Credit Agreement andthe other provisions of this note, Maker may borrow, repay and reborrow against this note at anytime unless and until a default (however designated) or event (an “Event of Potential Default”)which, if not cured after notice or before the lapse of time (or both) would develop into a defaultunder this note, the Credit Agreement or any other Credit Documents has occurred which the Holderhas not declared to have been fully cured or waived, and (except as the Credit Agreement or any ofthe other Credit Documents may otherwise provide) there is no limit on the number of advancesagainst this note so long as the total unpaid principal of this note at any time outstanding doesnot exceed the Payee’s Lender Commitment. Interest on the amount of each advance against this noteshall be computed on the amount of the unpaid balance of that advance from the date it is madeuntil the date it is repaid. If Maker’s right (if any) to borrow against this note shall everlapse because of the occurrence of any default, it shall not be reinstated (or construed from anycourse of conduct or otherwise to have been reinstated) unless and until the Holder shall declarein a signed writing that it has been cured or waived. The unpaid principal balance of this note atany time shall be the total of all principal lent against this note to Maker or for Maker’s accountless the sum of all principal payments and permitted prepayments on this note received by theHolder. Absent manifest error, the Holder’s computer records shall on any day conclusivelyevidence the unpaid balance of this note and its advances and payments history posted up to thatday. All loans and advances and all payments and permitted prepayments made on this note may be(but are not required to be) endorsed by the Holder on the schedule attached hereto (which ishereby made a part hereof for all purposes) or otherwise recorded in the Holder’s computer ormanual records; provided, that any Holder’s failure to make notation of (a) any principal advanceor accrual of interest shall not cancel, limit or otherwise affect Maker’s obligations or anyHolder’s rights with respect to that advance or accrual, or (b) any payment or permitted prepaymentof principal or interest shall not cancel, limit or otherwise affect

Page 2 of 5 Pages
EXHIBIT C

 


 

Maker’s entitlement to credit for that payment as of the date of its receipt by the Holder.Maker and Payee expressly agree, as expressly allowed by Chapter 346 of the Texas Finance Code,that Chapter 346 (which relates to open-end line of credit revolving loan accounts) shall not applyto this note or to any loan evidenced by this note and that neither this note nor any such loanshall be governed by Chapter 346 or subject to its provisions in any manner whatsoever.

     9. Credit Agreement. This note has been issued pursuant to the terms of the Credit Agreement,to which reference is made for all purposes. Advances against this note by Payee or other Holderhereof shall be governed by the Credit Agreement. Payee is entitled to the benefits of the CreditAgreement. As additional security for this note, Maker hereby grants to Payee and all otherpresent and future Holders an express lien against, security interest in and contractual right ofsetoff in and to, all property and any and all deposits (general or special, time or demand,provisional or final) at any time held by the Payee or other Holder for any Maker’s credit oraccount.

     10. Defaults and Remedies. Time is of the essence. Maker’s failure to pay any principal oraccrued interest owing on this note when due and after expiration of any applicable period fornotice and right to cure such a default which is specifically provided for in the Credit Agreementor any other provision of this note, or the occurrence of any default under the Credit Agreement orany other Credit Documents shall constitute default under this note, whereupon the Holder may electto exercise any or all rights, powers and remedies afforded (a) under the Credit Agreement and allother papers related to this note and (b) by law, including the right to accelerate the maturity ofthis entire note.

     In addition to and cumulative of such rights, the Holder is hereby authorized at any time andfrom time to time after any such default, at Holder’s option, without notice to Maker or any otherperson or entity (all rights to any such notice being hereby waived), to set off and apply any andall of any Maker’s deposits at any time held by the Holder, and any other debt at any time owing bythe Holder to or for the credit or account of any Maker, against the outstanding balance of thisnote, in such order and manner as Holder may elect in its sole discretion.

     The Holder’s right to accelerate this note on account of any late payment or other defaultshall not be waived or deemed waived by the Holder by reason of the Holder’s having previouslyaccepted one or more late payments or by reason of any Holder’s otherwise not accelerating thisnote or exercising other remedies for any default, and no Holder shall ever be obligated or deemedobligated to notify Maker or any other person that Holder is requiring strict compliance with thisnote or any papers securing or otherwise relating to it before such Holder may accelerate this noteor exercise any other remedy.

Page 3 of 5 Pages
EXHIBIT C

 


 

     Nothing in this Section or elsewhere shall be construed as diminishing Holder’s absolute rightto demand payment of all or any part of this note at any time.

     11. Legal Costs. If any Holder of this note retains an attorney in connection with any suchdefault or to collect, enforce or defend this note or any papers intended to secure or guarantee itin any lawsuit or in any probate, reorganization, bankruptcy or other proceeding, or if Maker suesany Holder in connection with this note or any such papers and does not prevail, then Maker agreesto pay to each such Holder, in addition to principal and interest, all reasonable costs andexpenses incurred by such Holder in trying to collect this note or in any such suit or proceeding,including reasonable attorneys’ fees.

     12. Waivers. Except only for any notices which are specifically required by the CreditAgreement, Maker and any and all co-makers, endorsers, guarantors and sureties severally waivenotice (including, but not limited to, notice of intent to accelerate and notice of acceleration,notice of protest and notice of dishonor), demand, presentment for payment, protest, diligence incollecting and the filing of suit for the purpose of fixing liability and consent that the time ofpayment hereof may be extended and re-extended from time to time without notice to any of them.Each such person agrees that his, her or its liability on or with respect to this note shall not beaffected by any release of or change in any guaranty or security at any time existing or by anyfailure to perfect or maintain perfection of any lien against or security interest in any suchsecurity or the partial or complete unenforceability of any guaranty or other surety obligation, ineach case in whole or in part, with or without notice and before or after maturity.

     13. Rate of Return Maintenance Covenant. If at any time after the date of this note, anyHolder determines that (a) any applicable law, rule or regulation regarding capital adequacy ofgeneral applicability has been adopted or changed, or (b) its interpretation or administration byany governmental authority, central bank or comparable agency has changed, and determines that suchchange or the Holder’s compliance with any request or directive regarding capital adequacy ofgeneral applicability (whether or not having the force of law) of any such authority, central bankor comparable agency, has or would have the effect of reducing the rate of return on the Holder’scapital as a consequence of its obligations under this note or any related papers to a level belowthat which the Holder could have achieved but for such adoption, change or compliance (taking intoconsideration the Holder’s own capital adequacy policies) by an amount the Holder deems to bematerial, then Maker promises to pay from time to time to the order of the Holder such additionalamount or amounts as will compensate the Holder for such reduction. A certificate of any Holdersetting forth the amount or amounts necessary to compensate the Holder as specified above shall begiven to Maker as soon as practicable after the Holder has made such determination and shall beconclusive and binding, absent manifest error. Maker shall pay the Holder the amount shown as dueon any such certificate within 15 days after the Holder gives it. In preparing such certificate,the Holder may employ such assumptions and make such allocations of costs and expenses as

Page 4 of 5 Pages
EXHIBIT C

 


 

the Holder in good faith deems reasonable and may use any reasonable averaging and attributionmethod.

     14. Governing Law, Jurisdiction and Venue. This note shall be governed by and construed inaccordance with the laws of the State of Texas and the United States of America from time to timein effect.

     15. General Purpose of Loan. Maker warrants and represents to Payee and all other Holdersthat all loans evidenced by this note are and will be for business, commercial, investment or othersimilar purpose and not primarily for personal, family, household or agricultural use.

     16. Participations and Assignments. Payee and each other Holder reserves the right,exercisable in such Holder’s discretion and without notice to Maker or any other person, to sellparticipations, assign interests or both, in all or any part of this note or the debt evidenced bythis note, in accordance with the Credit Agreement.

     17. Limitation of Liability. No obligation or liability whatsoever of Maker which may ariseat any time under this promissory note or any obligation or liability which may be incurred by itpursuant to any other instrument, transaction or undertaking contemplated hereby shall bepersonally binding upon, nor shall resort for the enforcement thereof be had to the privateproperty of, any of Maker’s trustees or shareholders regardless of whether such obligation orliability is in the nature of contract, tort or otherwise.

             
    ARCHSTONE-SMITH OPERATING TRUST    
 
           
  By:        
           
  Name:        
           
  Title:        
           

Page 5 of 5 Pages
EXHIBIT C

 


 

SWING LOAN NOTE

     
$100,000,000.00
                      ,2004

     FOR VALUE RECEIVED ARCHSTONE-SMITH OPERATING TRUST, a Maryland real estate investment trust(herein called “Maker”) promises to pay to the order of JPMORGAN CHASE BANK, N.A., at 712Main Street, Houston, Texas 77002, or at such other place as the holder (the “Holder”,whether or not Payee is such holder) of this note may hereafter designate in writing, inimmediately available funds and in lawful money of the United States of America, the principal sumof One Hundred Million Dollars ($100,000,000.00) (or the unpaid balance of all principal advancedagainst this note, if that amount is less), together with interest on the unpaid principal balanceof this note from time to time outstanding at the Stated Rate and interest on all past due amounts,both principal and accrued interest, at the Past Due Rate; provided, that for the full termof this note the interest rate produced by the aggregate of all sums paid or agreed to be paid tothe Holder of this note for the use, forbearance or detention of the debt evidenced hereby(including, but not limited to, all interest on this note at the Stated Rate) shall not exceed theCeiling Rate.

     1. Definitions. Any terms not defined herein shall have the meaning given to them in theAmended and Restated Credit Agreement dated of even date herewith among the Maker, and certainother Lenders (as the same may be amended or modified the “Credit Agreement”).

     2. Rates Change Automatically and Without Notice. Without notice to Maker or anyother person or entity and to the full extent allowed by applicable law from time to time ineffect, the Prime Rate and the Ceiling Rate shall each automatically fluctuate upward and downwardas and in the amount by which Holder’s said prime rate, and such maximum nonusurious rate ofinterest permitted by applicable law, respectively, fluctuate.

     3. Calculation of Interest. Interest shall be computed for the actual number of dayselapsed in a year (up to 365, or 366 in a leap year) deemed to consist of 360 days, unless theCeiling Rate would thereby be exceeded, in which event, to the extent necessary to avoid exceedingthe Ceiling Rate, interest shall be computed on the basis of the actual number of days elapsed inthe applicable calendar year in which it accrued.

     4. Excess Interest Will be Refunded or Credited. If, for any reason whatever, theinterest paid or received on this note during its full term produces a rate which exceeds theCeiling Rate, the Holder of this note shall refund to the payor or, at the Holder’s option, creditagainst the principal of this note such portion of that interest as shall be necessary to cause theinterest paid on this note to produce a rate equal to the Ceiling Rate.

     5. Interest Will be Spread. All sums paid or agreed to be paid to the Holder of thisnote for the use, forbearance or detention of the indebtedness evidenced hereby, to the extentpermitted by applicable law and to the extent necessary to avoid violating applicable usury laws,

EXHIBIT C-1
Page 1 of 5 Pages

 


 

shall be amortized, prorated, allocated and spread in equal parts throughout the full term ofthis note, so that the interest rate is uniform throughout the full term of this note.

     6. Payment Schedule. The principal of this note shall be due and payable on theMaturity Date. Accrued and unpaid interest shall be due and payable on each Interest Payment Date.

     7. Prepayment. Maker may prepay this note only as provided in the Credit Agreement.

     8. Revolving Credit. Upon and subject to the terms and conditions of the CreditAgreement and the other provisions of this note, Maker may borrow, repay and reborrow against thisnote at any time unless and until a default (however designated) or event (an “Event ofPotential Default”) which, if not cured after notice or before the lapse of time (or both)would develop into a default under this note, the Credit Agreement or any other Credit Documentshas occurred which the Holder has not declared to have been fully cured or waived, and (except asthe Credit Agreement or any of the other Credit Documents may otherwise provide) there is no limiton the number of advances against this note so long as the total unpaid principal of this note atany time outstanding does not exceed $100,000,000.00. Interest on the amount of each advanceagainst this note shall be computed on the amount of the unpaid balance of that advance from thedate it is made until the date it is repaid. If Maker’s right (if any) to borrow against this noteshall ever lapse because of the occurrence of any default, it shall not be reinstated (or construedfrom any course of conduct or otherwise to have been reinstated) unless and until the Holder shalldeclare in a signed writing that it has been cured or waived. The unpaid principal balance of thisnote at any time shall be the total of all principal lent against this note to Maker or for Maker’saccount less the sum of all principal payments and permitted prepayments on this note received bythe Holder. Absent manifest error, the Holder’s computer records shall on any day conclusivelyevidence the unpaid balance of this note and its advances and payments history posted up to thatday. All loans and advances and all payments and permitted prepayments made on this note may be(but are not required to be) endorsed by the Holder on the schedule attached hereto (which ishereby made a part hereof for all purposes) or otherwise recorded in the Holder’s computer ormanual records; provided, that any Holder’s failure to make notation of (a) any principaladvance or accrual of interest shall not cancel, limit or otherwise affect Maker’s obligations orany Holder’s rights with respect to that advance or accrual, or (b) any payment or permittedprepayment of principal or interest shall not cancel, limit or otherwise affect Maker’s entitlementto credit for that payment as of the date of its receipt by the Holder. Maker and Payee expresslyagree, as expressly allowed by Chapter 346 of the Texas Finance Code, that Chapter 346 (whichrelates to open-end line of credit revolving loan accounts) shall not apply to this note or to anyloan evidenced by this note and that neither this note nor any such loan shall be governed byChapter 346 or subject to its provisions in any manner whatsoever.

     9. Credit Agreement. This note has been issued pursuant to the terms of the CreditAgreement, to which reference is made for all purposes. Advances against this note by Payee orother Holder hereof shall be governed by the Credit Agreement. Payee is entitled to the benefitsof the Credit Agreement. As additional security for this note, Maker hereby grants to Payee and

EXHIBIT C-1
Page 2 of 5 Pages

 


 

all other present and future Holders an express lien against, security interest in andcontractual right of setoff in and to, all property and any and all deposits (general or special,time or demand, provisional or final) at any time held by the Payee or other Holder for any Maker’scredit or account.

     10. Defaults and Remedies. Time is of the essence. Maker’s failure to pay anyprincipal or accrued interest owing on this note when due and after expiration of any applicableperiod for notice and right to cure such a default which is specifically provided for in the CreditAgreement or any other provision of this note, or the occurrence of any default under the CreditAgreement or any other Credit Documents shall constitute default under this note, whereupon theHolder may elect to exercise any or all rights, powers and remedies afforded (a) under the CreditAgreement and all other papers related to this note and (b) by law, including the right toaccelerate the maturity of this entire note.

     In addition to and cumulative of such rights, the Holder is hereby authorized at any time andfrom time to time after any such default, at Holder’s option, without notice to Maker or any otherperson or entity (all rights to any such notice being hereby waived), to set off and apply any andall of any Maker’s deposits at any time held by the Holder, and any other debt at any time owing bythe Holder to or for the credit or account of any Maker, against the outstanding balance of thisnote, in such order and manner as Holder may elect in its sole discretion.

     The Holder’s right to accelerate this note on account of any late payment or other defaultshall not be waived or deemed waived by the Holder by reason of the Holder’s having previouslyaccepted one or more late payments or by reason of any Holder’s otherwise not accelerating thisnote or exercising other remedies for any default, and no Holder shall ever be obligated or deemedobligated to notify Maker or any other person that Holder is requiring strict compliance with thisnote or any papers securing or otherwise relating to it before such Holder may accelerate this noteor exercise any other remedy.

     Nothing in this Section or elsewhere shall be construed as diminishing Holder’s absolute rightto demand payment of all or any part of this note at any time.

     11. Legal Costs. If any Holder of this note retains an attorney in connection withany such default or to collect, enforce or defend this note or any papers intended to secure orguarantee it in any lawsuit or in any probate, reorganization, bankruptcy or other proceeding, orif Maker sues any Holder in connection with this note or any such papers and does not prevail, thenMaker agrees to pay to each such Holder, in addition to principal and interest, all reasonablecosts and expenses incurred by such Holder in trying to collect this note or in any such suit orproceeding, including reasonable attorneys’ fees.

     12. Waivers. Except only for any notices which are specifically required by theCredit Agreement, Maker and any and all co-makers, endorsers, guarantors and sureties severallywaive notice (including, but not limited to, notice of intent to accelerate and notice ofacceleration, notice of protest and notice of dishonor), demand, presentment for payment, protest,diligence in collecting and the filing of suit for the purpose of fixing liability and consent

EXHIBIT C-1
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that the time of payment hereof may be extended and re-extended from time to time withoutnotice to any of them. Each such person agrees that his, her or its liability on or with respectto this note shall not be affected by any release of or change in any guaranty or security at anytime existing or by any failure to perfect or maintain perfection of any lien against or securityinterest in any such security or the partial or complete unenforceability of any guaranty or othersurety obligation, in each case in whole or in part, with or without notice and before or aftermaturity.

     13. Rate of Return Maintenance Covenant. If at any time after the date of this note,any Holder determines that (a) any applicable law, rule or regulation regarding capital adequacy ofgeneral applicability has been adopted or changed, or (b) its interpretation or administration byany governmental authority, central bank or comparable agency has changed, and determines that suchchange or the Holder’s compliance with any request or directive regarding capital adequacy ofgeneral applicability (whether or not having the force of law) of any such authority, central bankor comparable agency, has or would have the effect of reducing the rate of return on the Holder’scapital as a consequence of its obligations under this note or any related papers to a level belowthat which the Holder could have achieved but for such adoption, change or compliance (taking intoconsideration the Holder’s own capital adequacy policies) by an amount the Holder deems to bematerial, then Maker promises to pay from time to time to the order of the Holder such additionalamount or amounts as will compensate the Holder for such reduction. A certificate of any Holdersetting forth the amount or amounts necessary to compensate the Holder as specified above shall begiven to Maker as soon as practicable after the Holder has made such determination and shall beconclusive and binding, absent manifest error. Maker shall pay the Holder the amount shown as dueon any such certificate within 15 days after the Holder gives it. In preparing such certificate,the Holder may employ such assumptions and make such allocations of costs and expenses as theHolder in good faith deems reasonable and may use any reasonable averaging and attribution method.

     14. Governing Law, Jurisdiction and Venue. This note shall be governed by andconstrued in accordance with the laws of the State of Texas and the United States of America fromtime to time in effect.

     15. General Purpose of Loan. Maker warrants and represents to Payee and all otherHolders that all loans evidenced by this note are and will be for business, commercial, investmentor other similar purpose and not primarily for personal, family, household or agricultural use.

     16. Participations and Assignments. Payee and each other Holder reserves the right,exercisable in such Holder’s discretion and without notice to Maker or any other person, to sellparticipations, assign interests or both, in all or any part of this note or the debt evidenced bythis note, in accordance with the Credit Agreement.

     17. Limitation of Liability. No obligation or liability whatsoever of Maker which mayarise at any time under this promissory note or any obligation or liability which may be incurredby it pursuant to any other instrument, transaction or undertaking contemplated hereby shall bepersonally binding upon, nor shall resort for the enforcement thereof be had to the

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private property of, any of Maker’s trustees or shareholders regardless of whether suchobligation or liability is in the nature of contract, tort or otherwise.

             
    ARCHSTONE-SMITH OPERATING TRUST    
 
           
  By:        
           
  Name:        
           
  Title:        
           

EXHIBIT C-1
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MASTER NOTE
Money Market Borrowings

     
$300,000,000.00
                      ,2004

     FOR VALUE RECEIVED ARCHSTONE-SMITH OPERATING TRUST, a Maryland real estate investment trust(herein called “Maker”) promises to pay to the order of                                                             Payee”), at the officesof JPMorgan Chase Bank, N.A., as “Agent” under the Credit Agreement, at 712 Main Street,Houston, Texas 77002, or at such other place as the holder (the “Holder”, whether or notPayee is such holder) of this note may hereafter designate in writing, in immediately availablefunds and in lawful money of the United States of America, the principal sum of Three HundredMillion Dollars ($300,000,000.00) (or the unpaid balance of all principal advanced against thisnote, if that amount is less), together with interest on the unpaid principal balance of this notefrom time to time outstanding at the Stated Rate for Money Market Loans and interest on all pastdue amounts, both principal and accrued interest, at the Past Due Rate; provided, that forthe full term of this note the interest rate produced by the aggregate of all sums paid or agreedto be paid to the Holder of this note for the use, forbearance or detention of the debt evidencedhereby (including, but not limited to, all interest on this note at the Stated Rate for MoneyMarket Loans) shall not exceed the Ceiling Rate.

     1. Definitions. Any terms not defined herein shall have the meaning given to them inthe Amended and Restated Credit Agreement dated of even date herewith among the Maker, the Agentand certain other Lenders (as the same has been and may be further amended or modified the “CreditAgreement”).

     2. Rates Change Automatically and Without Notice. Without notice to Maker or anyother person or entity and to the full extent allowed by applicable law from time to time ineffect, the Prime Rate and the Ceiling Rate shall each automatically fluctuate upward and downwardas and in the amount by which Agent’s said prime rate, and such maximum nonusurious rate ofinterest permitted by applicable law, respectively, fluctuate.

     3. Calculation of Interest. Interest shall be computed for the actual number of dayselapsed in a year (up to 365, or 366 in a leap year) deemed to consist of 360 days, unless theCeiling Rate would thereby be exceeded, in which event, to the extent necessary to avoid exceedingthe Ceiling Rate, interest shall be computed on the basis of the actual number of days elapsed inthe applicable calendar year in which it accrued.

     4. Excess Interest Will be Refunded or Credited. If, for any reason whatever, theinterest paid or received on this note during its full term produces a rate which exceeds theCeiling Rate, the Holder of this note shall refund to the payor or, at the Holder’s option, credit

EXHIBIT C-2
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against the principal of this note such portion of that interest as shall be necessary tocause the interest paid on this note to produce a rate equal to the Ceiling Rate.

     5. Interest Will be Spread. All sums paid or agreed to be paid to the Holder of thisnote for the use, forbearance or detention of the indebtedness evidenced hereby, to the extentpermitted by applicable law and to the extent necessary to avoid violating applicable usury laws,shall be amortized, prorated, allocated and spread in equal parts throughout the full term of thisnote, so that the interest rate is uniform throughout the full term of this note.

     6. Payment Schedule. The principal of this note shall be due and payable on the dateset forth in each Notice of Money Market Borrowing with respect to the principal borrowed pursuantto said Notice, and the Maturity Date. Accrued and unpaid interest shall be due and payable oneach Interest Payment Date.

     7. Prepayment. Maker may prepay this note only as provided in the Credit Agreement.

     8. Revolving Credit. Upon and subject to the terms and conditions of the CreditAgreement and the other provisions of this note, Maker may borrow, repay and reborrow against thisnote at any time unless and until a default (however designated) or event (an “Event of PotentialDefault”) which, if not cured after notice or before the lapse of time (or both) would develop intoa default under this note, the Credit Agreement or any other Credit Documents has occurred whichthe Holder has not declared to have been fully cured or waived, and (except as the Credit Agreementor any of the other Credit Documents may otherwise provide) there is no limit on the number ofadvances against this note so long as the total unpaid principal of this note at any timeoutstanding does not exceed $300,000,000.00. Interest on the amount of each advance against thisnote shall be computed on the amount of the unpaid balance of that advance from the date it is madeuntil the date it is repaid. If Maker’s right (if any) to borrow against this note shall everlapse because of the occurrence of any default, it shall not be reinstated (or construed from anycourse of conduct or otherwise to have been reinstated) unless and until the Holder shall declarein a signed writing that it has been cured or waived. The unpaid principal balance of this note atany time shall be the total of all principal lent against this note to Maker or for Maker’s accountless the sum of all principal payments and permitted prepayments on this note received by theHolder. Absent manifest error, the Holder’s computer records shall on any day conclusivelyevidence the unpaid balance of this note and its advances and payments history posted up to thatday. All loans and advances and all payments and permitted prepayments made on this note may be(but are not required to be) endorsed by the Holder on the schedule attached hereto (which ishereby made a part hereof for all purposes) or otherwise recorded in the Holder’s computer ormanual records; provided, that any Holder’s failure to make notation of (a) any principal advanceor accrual of interest shall not cancel, limit or otherwise affect Maker’s obligations or anyHolder’s rights with respect to that advance or accrual, or (b) any payment or

EXHIBIT C-2
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permitted prepayment of principal or interest shall not cancel, limit or otherwise affectMaker’s entitlement to credit for that payment as of the date of its receipt by the Holder. Makerand Payee expressly agree, as expressly allowed by Chapter 346 of the Texas Finance Code, thatChapter 346 (which relates to open-end line of credit revolving loan accounts) shall not apply tothis note or to any loan evidenced by this note and that neither this note nor any such loan shallbe governed by Chapter 346 or subject to its provisions in any manner whatsoever.

     9. Credit Agreement. This note has been issued pursuant to the terms of Section 2.8of the Credit Agreement, to which reference is made for all purposes. Advances against this noteby Payee or other Holder hereof shall be governed by the Credit Agreement. Payee is entitled tothe benefits of the Credit Agreement. As additional security for this note, Maker hereby grants toPayee and all other present and future Holders an express lien against, security interest in andcontractual right of setoff in and to, all property and any and all deposits (general or special,time or demand, provisional or final) at any time held by the Payee or other Holder for any Maker’scredit or account.

     10. Defaults and Remedies. Time is of the essence. Maker’s failure to pay anyprincipal or accrued interest owing on this note when due and after expiration of any applicableperiod for notice and right to cure such a default which is specifically provided for in the CreditAgreement or any other provision of this note, or the occurrence of any default under the CreditAgreement or any other Credit Documents shall constitute default under this note, whereupon theHolder may elect to exercise any or all rights, powers and remedies afforded (a) under the CreditAgreement and all other papers related to this note and (b) by law, including the right toaccelerate the maturity of this entire note.

     In addition to and cumulative of such rights, the Holder is hereby authorized at any time andfrom time to time after any such default, at Holder’s option, without notice to Maker or any otherperson or entity (all rights to any such notice being hereby waived), to set off and apply any andall of any Maker’s deposits at any time held by the Holder, and any other debt at any time owing bythe Holder to or for the credit or account of any Maker, against the outstanding balance of thisnote, in such order and manner as Holder may elect in its sole discretion.

     The Holder’s right to accelerate this note on account of any late payment or other defaultshall not be waived or deemed waived by the Holder by reason of the Holder’s having previouslyaccepted one or more late payments or by reason of any Holder’s otherwise not accelerating thisnote or exercising other remedies for any default, and no Holder shall ever be obligated or deemedobligated to notify Maker or any other person that Holder is requiring strict compliance with thisnote or any papers securing or otherwise relating to it before such Holder may accelerate this noteor exercise any other remedy.

     Nothing in this Section or elsewhere shall be construed as diminishing Holder’s absolute rightto demand payment of all or any part of this note at any time.

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     11. Legal Costs. If any Holder of this note retains an attorney in connection withany such default or to collect, enforce or defend this note or any papers intended to secure orguarantee it in any lawsuit or in any probate, reorganization, bankruptcy or other proceeding, orif Maker sues any Holder in connection with this note or any such papers and does not prevail, thenMaker agrees to pay to each such Holder, in addition to principal and interest, all reasonablecosts and expenses incurred by such Holder in trying to collect this note or in any such suit orproceeding, including reasonable attorneys’ fees.

     12. Waivers. Except only for any notices which are specifically required by theCredit Agreement, Maker and any and all co-makers, endorsers, guarantors and sureties severallywaive notice (including, but not limited to, notice of intent to accelerate and notice ofacceleration, notice of protest and notice of dishonor), demand, presentment for payment, protest,diligence in collecting and the filing of suit for the purpose of fixing liability and consent thatthe time of payment hereof may be extended and re-extended from time to time without notice to anyof them. Each such person agrees that his, her or its liability on or with respect to this noteshall not be affected by any release of or change in any guaranty or security at any time existingor by any failure to perfect or maintain perfection of any lien against or security interest in anysuch security or the partial or complete unenforceability of any guaranty or other suretyobligation, in each case in whole or in part, with or without notice and before or after maturity.

     13. Rate of Return Maintenance Covenant. If at any time after the date of this note,any Holder determines that (a) any applicable law, rule or regulation regarding capital adequacy ofgeneral applicability has been adopted or changed, or (b) its interpretation or administration byany governmental authority, central bank or comparable agency has changed, and determines that suchchange or the Holder’s compliance with any request or directive regarding capital adequacy ofgeneral applicability (whether or not having the force of law) of any such authority, central bankor comparable agency, has or would have the effect of reducing the rate of return on the Holder’scapital as a consequence of its obligations under this note or any related papers to a level belowthat which the Holder could have achieved but for such adoption, change or compliance (taking intoconsideration the Holder’s own capital adequacy policies) by an amount the Holder deems to bematerial, then Maker promises to pay from time to time to the order of the Holder such additionalamount or amounts as will compensate the Holder for such reduction. A certificate of any Holdersetting forth the amount or amounts necessary to compensate the Holder as specified above shall begiven to Maker as soon as practicable after the Holder has made such determination and shall beconclusive and binding, absent manifest error. Maker shall pay the Holder the amount shown as dueon any such certificate within 15 days after the Holder gives it. In preparing such certificate,the Holder may employ such assumptions and make such allocations of costs and expenses as theHolder in good faith deems reasonable and may use any reasonable averaging and attribution method.

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     14. Governing Law, Jurisdiction and Venue. This note shall be governed by andconstrued in accordance with the laws of the State of Texas and the United States of America fromtime to time in effect.

     15. General Purpose of Loan. Maker warrants and represents to Payee and all otherHolders that all loans evidenced by this note are and will be for business, commercial, investmentor other similar purpose and not primarily for personal, family, household or agricultural use.

     16. Participations and Assignments. Payee and each other Holder reserves the right,exercisable in such Holder’s discretion and without notice to Maker or any other person, to sellparticipations, assign interests or both, in all or any part of this note or the debt evidenced bythis note, in accordance with the Credit Agreement.

     17. Limitation of Liability. No obligation or liability whatsoever of Maker which mayarise at any time under this promissory note or any obligation or liability which may be incurredby it pursuant to any other instrument, transaction or undertaking contemplated hereby shall bepersonally binding upon, nor shall resort for the enforcement thereof be had to the privateproperty of, any of Maker’s trustees or shareholders regardless of whether such obligation orliability is in the nature of contract, tort or otherwise.

             
    ARCHSTONE-SMITH OPERATING TRUST    
 
           
  By:        
           
  Name:        
           
  Title:        
           

EXHIBIT C-2
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Form of Money Market Quote Request

     
To:
  JPMorgan Chase Bank, N.A. (the “Agent”)
 
   
From:
  Archstone-Smith Operating Trust (the “Borrower”)
 
   
Re:
  Amended and Restated Credit Agreement (the “Credit Agreement”),dated December 13, 2004 among the Borrower, the Lenders partiesthereto and the Agent

          We hereby give notice pursuant to Section 2.8 of the Credit Agreement that we request MoneyMarket Quotes for the following proposed Money Market Loan(s):

Date of Borrowing:                                         

     
Principal Amount
  Interest Period
$
   

          Such Money Market Quotes should offer a Money Market [Margin] [Absolute Rate]. [Theapplicable base rate is the Adjusted Eurodollar Interbank Rate].

          The funding of Money Market Loans made in connection with this Money Market Quote Request[may/may not] be made by Designated Lenders.

          Terms used herein have the meanings assigned to them in the Credit Agreement.

             
    ARCHSTONE-SMITH OPERATING TRUST    
 
           
  By:        
           
  Name:        
           
  Title:        
           

                                             
Amount must be $20,000,000 or a larger multiple of $1,000,000.

Not less than one month (LIBOR Auction) or not less than 30 days (Absolute Rate Auction), subjectto the provisions of the definition of Interest Period.

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EXHIBIT F

Form of Invitation for Money Market Quotes

     
To:
  [Name of Lender]
 
   
RE:
  Invitation for Money Market Quotes to Archstone-Smith Operating Trust(the “Borrower”)

     Pursuant to Section 2.8 of the Amended and Restated Credit Agreement dated December 13, 2004among the Borrower, the Lenders parties thereto and the undersigned, as Agent, we are pleased onbehalf of the Borrower to invite you to submit Money Market Quotes to the Borrower for thefollowing proposed Money Market Loan(s):

Date of Borrowing:                                         

     
Principal Amount
  Interest Period
$
   

     Such Money Market Quotes should offer a Money Market [Margin] [Absolute Rate]. [The applicablebase rate is the Adjusted Eurodollar Interbank Rate.]

     Please respond to this invitation by no later than                      A.M. (New York, New York time) on[date].

         
    JPMORGAN CHASE BANK, N.A.,
as Agent
 
       
  By:    
       
      Authorized Officer

EXHIBIT F
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Form of Money Market Quote

To: JPMorgan Chase Bank, N.A., as Agent

RE: Money Market Quote to Archstone-Smith Operating Trust (the “Borrower”)

     In response to your invitation on behalf of the Borrower dated ___, 200___, wehereby make the following Money Market Quote on the following terms:

1.   Quoting Bank:                                        
 
2.   Person to contact at Quoting Bank:
 
3.   We hereby offer to make Money Market Loan(s) in the following principal amounts, for thefollowing Interest Periods and the following rates:
                 
Principal   Interest     Money Market  
Amount   Period     [Margin]_[Absolute Rate]  
$
               
$
               

[Provided, that the aggregate principal amount of Money Market Loans for which the aboveoffers may be accepted shall not exceed $___.]

               We understand and agree that the offer(s) set forth above, subject to the satisfactionof the applicable conditions set forth in the Amended and Restated Credit Agreement datedDecember 13, 2004 among the Borrower, the Lenders parties thereto and yourselves, as Agent,irrevocably obligates us to make the Money Market Loan(s) for which any offer(s) areaccepted, in whole or in part.

                 
            Very truly yours,
 
               
            [NAME OF LENDER]
 
               
Dated:
          By:    
               
                     Authorized Officer

EXHIBIT G
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Form of Designation Agreement

Dated ____________, 200__

     Reference is made to that certain Amended and Restated Credit Agreement dated December 13,2004 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”)among ARCHSTONE-SMITH OPERATING TRUST, the Lenders parties thereto, and JPMORGAN CHASE BANK, N.A.(the “Agent”), as Agent. Terms defined in the Credit Agreement are used herein with the samemeaning.

     [NAME OF DESIGNOR] (the “Designor”), [NAME OF DESIGNEE] (the “Designee”), the Agent andBorrower agree as follows:

     1. The Designor hereby designates the Designee, and the Designee hereby accepts suchdesignation, to have a right to make Money Market Loans pursuant to Section 2.8 of the CreditAgreement. Any assignment by Designor to Designee of its rights to make a Money Market Loanpursuant to such Section 2.8 shall be effective at the time of the funding of such Money MarketLoan and not before such time.

     2. Except as set forth in Section 7 below, the Designor makes no representation or warrantyand assumes no responsibility pursuant to this Designation Agreement with respect to (a) anystatements, warranties or representations made in or in connection with any Credit Document or theexecution, legality, validity, enforceability, genuineness, sufficiency or value of any CreditDocument or any other instrument and document furnished pursuant thereto and (b) the financialcondition of the Borrower or the performance or observance by the Borrower of any of itsobligations under any Credit Document or any other instrument or document furnished pursuantthereto.

     3. The Designee (a) confirms that it has received a copy of each Credit Document, togetherwith copies of the financial statements referred to in Section 5.2 of the Credit Agreement and suchother documents and information as it has deemed appropriate to make its own credit analysis anddecision to enter into this Designation Agreement; (b) agrees that it will independently andwithout reliance upon the Agent, the Designor or any other Lender and based on such documents andinformation as it shall deem appropriate at the time, continue to make its own credit decisions intaking or not taking action under any Credit Document; (c) confirms that it is a Designated Lender;(d) appoints and authorizes the Agent to take such action as agent on its behalf and to exercisesuch powers and discretion under any Credit Document as are delegated to the Agent by the termsthereof, together with such powers and discretion as are reasonably incidental thereto; and (e)agrees to be bound by each and every provision of each Credit Document and further agrees that itwill perform in accordance with their terms all of the obligations which by the terms of any CreditDocument are required to be performed by it as a Lender.

     4. The Designee hereby appoints Designor as Designee’s agent and attorney in fact, and grantsto Designor an irrevocable power of attorney, to receive payments made for the

EXHIBIT H
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benefit of Designee under the Credit Agreement, to deliver and receive all communications andnotices under the Credit Agreement and other Credit Documents and to exercise on Designee’s behalfall rights to vote and to grant and make approvals, waivers, consents or amendments to or under theCredit Agreement or other Credit Documents. Any document executed by the Designor on theDesignee’s behalf in connection with the Credit Agreement or other Credit Documents shall bebinding on the Designee. The Borrower, the Agent and each of the Lenders may rely on and arebeneficiaries of the preceding provisions.

     5. Following the execution of this Designation Agreement by the Designor and its Designee, itwill be delivered to the Agent for acceptance by the Agent. The effective date for thisDesignation Agreement (the “Effective Date”) shall be the date of acceptance hereof by the Agent,unless otherwise specified on the signature page hereto.

     6. The Agent hereby agrees that it will not institute against any Designee or join any otherPerson in instituting against any Designee any bankruptcy, reorganization, arrangement, insolvencyor liquidation proceeding under any federal or state bankruptcy or similar law, until the later tooccur of (i) one year and one day after the payment in full of the latest maturing commercial papernote issued by such Designee and (ii) the Maturity Date.

     7. The Designor unconditionally agrees to pay or reimburse the Designee and save the Designeeharmless against all liabilities, obligations, losses, damages, penalties, actions and judgments,suits, costs, expenses or disbursements of any kind or nature whatsoever which may be imposed orasserted by any of the parties to the Credit Documents against the Designee, in its capacity assuch, in any way relating to or arising out of this Designation Agreement or any other CreditDocuments or any action taken or omitted by the Designee hereunder or thereunder, INCLUDING THENEGLIGENCE OF THE DESIGNEE provided that the Designor shall not be liable for any portion of suchliabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses ordisbursements if the same results from the Designee’s gross negligence or willful misconduct.

     8. As of the Effective Date the Designee shall be a party to the Credit Agreement with a right(subject to the provisions of Section 2.8(b)) to make Money Market Loans as a Lender pursuant toSection 2.8 of the Credit Agreement and the rights and obligations of a Lender related thereto;provided, however, that the Designee shall not be required to make payments with respect to suchobligations except to the extent of excess cash flow of such Designee which is not otherwiserequired to repay obligations of such Designee, which are then due and payable. Notwithstandingthe foregoing, the Designor, as administrative agent for the Designee, shall be and remainobligated to the Borrower, the Agent and the Lenders for each and every one of the obligations ofthe Designee and its Designor with respect to the Credit Agreement, including, without limitation,any indemnification obligations under Section 8.5 of the Credit Agreement and any sums otherwisepayable to the Borrower by the Designee.

     9. This Designation Agreement shall be governed by, and construed in accordance with, the lawsof the State of Texas.

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     10. This Designation Agreement may be executed in any number of counterparts and by differentparties hereto in separate counterparts, each of which when so executed shall be deemed to be anoriginal and all of which taken together shall constitute one and the same agreement. Delivery ofan executed counterpart of a signature page to this Designation Agreement by facsimile transmissionshall be effective as delivery of a manually executed counterpart of this Designation Agreement.

     IN WITNESS WHEREOF, the Designor and the Designee, intending to be legally bound, have causedthis Designation Agreement to be executed by their officers thereunto duly authorized as of thedate first above written.

Effective Date:

                                        , 200___

                     
        [NAME OF DESIGNOR], as Designor
 
                   
      By:            
                   
      Title:            
                   
 
                   
        [NAME OF DESIGNEE], as Designee
 
                   
      By:            
                   
      Title:            
                   
 
                   
        Applicable Lending Office
(and address for notices):
 
                   
          [Address]        
 
                   
Accepted this _____ day of                
______________, 200__                
 
                   
JPMORGAN CHASE BANK, N.A., as Agent                
 
                   
By:
                   
                   
Name:
                   
                   
Title:
                   
                   

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FORM OF GUARANTY

     THIS GUARANTY dated as of ___, 2004 executed and delivered by each of theundersigned, whether one or more, (all each a “Guarantor” and collectively, the “Guarantors”), infavor of (a) JPMORGAN CHASE BANK, N.A., in its capacity as Agent (the “Agent”) for the Lendersunder that certain Amended and Restated Credit Agreement dated as of December 13, 2004 by and amongARCHSTONE-SMITH OPERATING TRUST (the “Borrower”), the financial institutions party thereto andtheir assignees in accordance therewith (the “Lenders”), and the Agent (as the same may be amended,restated, supplemented or otherwise modified from time to time in accordance with its terms, the“Credit Agreement”) and (b) the Lenders.

     WHEREAS, pursuant to the Credit Agreement, the Lenders have made available to the Borrowercertain financial accommodations on the terms and conditions set forth in the Credit Agreement;

     WHEREAS, each Guarantor is a wholly-owned Subsidiary of the Borrower;

     WHEREAS, the Borrower, each Guarantor and the other Subsidiaries of the Borrower, thoughseparate legal entities, are mutually dependent on each other in the conduct of their respectivebusinesses as an integrated operation and have determined it to be in their mutual best intereststo obtain financing from the Agent and the Lenders through their collective efforts;

     WHEREAS, each Guarantor acknowledges that it will receive direct and indirect benefits fromthe Agent and the Lenders making such financial accommodations available to the Borrower under theCredit Agreement and, accordingly, each Guarantor is willing to guarantee the Borrower’sobligations to the Agent and the Lenders on the terms and conditions contained herein; and

     WHEREAS, each Guarantor’s execution and delivery of this Guaranty is one of the conditionsprecedent to the Agent and the Lenders making, or continuing to make, such financial accommodationsto the Borrower.

     NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which arehereby acknowledged by each Guarantor, each Guarantor agrees as follows:

     Section 1. Guaranty. Each Guarantor hereby absolutely and unconditionallyguaranties the due and punctual payment and performance of all of the following (collectivelyreferred to as the “Obligations”): (a) all indebtedness and obligations owing by the Borrower toany of the Lenders or the Agent under or in connection with the Credit Agreement and any otherCredit Document, including without limitation, the repayment of all principal of the Loans made bythe Lenders to the Borrower under the Credit Agreement and the payment of all interest, fees,charges, reasonable attorneys fees and other amounts payable to any Lender or the Agent thereunderor in connection therewith; (b) any and all extensions, renewals, modifications, amendments orsubstitutions of the foregoing; and (c) all expenses, including, without limitation,

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reasonable attorneys’ fees and disbursements, that are incurred by the Lenders or the Agent inthe enforcement of any of the foregoing or any obligation of such Guarantor hereunder.

     Section 2. Guaranty of Payment and Not of Collection. This Guaranty is a guaranty ofpayment, and not of collection, and a debt of each Guarantor for its own account. Accordingly, theLenders and the Agent shall not be obligated or required before enforcing this Guaranty against anyGuarantor: (a) to pursue any right or remedy the Lenders or the Agent may have against theBorrower, any other Guarantor or any other Person or commence any suit or other proceeding againstthe Borrower, any other Guarantor or any other Person in any court or other tribunal; (b) to makeany claim in a liquidation or bankruptcy of the Borrower, any other Guarantor or any other Person;or (c) to make demand of the Borrower, any other Guarantor or any other Person or to enforce orseek to enforce or realize upon any collateral security held by the Lenders or the Agent which maysecure any of the Obligations. In this connection, each Guarantor hereby waives the right of suchGuarantor to require any holder of the Obligations to take action against the Borrower as providedby any Legal Requirement.

     Section 3. Guaranty Absolute. Each Guarantor guarantees that the Obligations will bepaid strictly in accordance with the terms of the documents evidencing the same, regardless of anyLegal Requirement now or hereafter in effect in any jurisdiction affecting any of such terms or therights of the Agent or the Lenders with respect thereto. The liability of each Guarantor under thisGuaranty shall be absolute and unconditional in accordance with its terms and shall remain in fullforce and effect without regard to, and shall not be released, suspended, discharged, terminated orotherwise affected by, any circumstance or occurrence whatsoever, including without limitation, thefollowing (whether or not such Guarantor consents thereto or has notice thereof):

     (a) (i) any change in the amount, interest rate or due date or other term of any of theObligations, (ii) any change in the time, place or manner of payment of all or any portion of theObligations, (iii) any amendment or waiver of, or consent to the departure from or other indulgencewith respect to, the Credit Agreement, any other Credit Document, or any other document orinstrument evidencing or relating to any Obligations, or (iv) any waiver, renewal, extension,addition, or supplement to, or deletion from, or any other action or inaction under or in respectof, the Credit Agreement, any of the other Credit Documents, or any other documents, instruments oragreements relating to the Obligations or any other instrument or agreement referred to therein orevidencing any Obligations or any assignment or transfer of any of the foregoing;

     (b) any lack of validity or enforceability of the Credit Agreement, any of the other CreditDocuments, or any other document, instrument or agreement referred to therein or evidencing anyObligations or any assignment or transfer of any of the foregoing;

     (c) any furnishing to the Agent or the Lenders of any security for the Obligations, or anysale, exchange, release or surrender of, or realization on, any collateral security for theObligations;

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     (d) any settlement or compromise of any of the Obligations, any security therefor, or anyliability of any other party with respect to the Obligations, or any subordination of the paymentof the Obligations to the payment of any other liability of the Borrower;

     (e) any bankruptcy, insolvency, reorganization, composition, adjustment, dissolution,liquidation or other like proceeding relating to any other Guarantor, the Borrower or any otherPerson, or any action taken with respect to this Guaranty by any trustee or receiver, or by anycourt, in any such proceeding;

     (f) any nonperfection of any security interest or other Lien on any of the collateral securingany of the Obligations;

     (g) any act or failure to act by the Borrower or any other Person which may adversely affectsuch Guarantor’s subrogation rights, if any, against the Borrower to recover payments made underthis Guaranty;

     (h) any application of sums paid by the Borrower or any other Person with respect to theliabilities of the Borrower to the Agent or the Lenders, regardless of what liabilities of theBorrower remain unpaid;

     (i) any defect, limitation or insufficiency in the borrowing powers of the Borrower or in theexercise thereof; or

     (j) any other circumstance which might otherwise constitute a defense available to, or adischarge of, any Guarantor hereunder.

     Section 4. Action with Respect to Obligations. The Lenders and the Agent may, at anytime and from time to time, without the consent of, or notice to, any Guarantor, and withoutdischarging any Guarantor from its obligations hereunder take any and all actions described inSection 3 and may otherwise: (a) amend, modify, alter or supplement the terms of any ofthe Obligations, including, but not limited to, extending or shortening the time of payment of anyof the Obligations or the interest rate that may accrue on any of the Obligations; (b) amend,modify, alter or supplement the Credit Agreement or any other Credit Document; (c) sell, exchange,release or otherwise deal with all, or any part, of any collateral securing any of the Obligations;(d) release any Person liable in any manner for the payment or collection of the Obligations; (e)exercise, or refrain from exercising, any rights against the Borrower or any other Person(including, without limitation, any other Guarantor); and (f) apply any sum, by whomsoever paid orhowever realized, to the Obligations in such order as the Lenders or the Agent shall elect.

     Section 5. Representations and Warranties. Each Guarantor hereby makes to the Agentand the Lenders all of the representations and warranties made by the Borrower with respect to orin any way relating to such Guarantor in the Credit Agreement and the other Credit Documents, as ifthe same were set forth herein in full.

     Section 6. Covenants. Each Guarantor will comply with all covenants which theBorrower is to cause such Guarantor to comply with under the terms of the Credit Agreement or

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any other Credit Documents. Guarantor specifically agrees that to the extent GuarantyProceeds (as defined in Section 7.3(a) of the Credit Agreement) are distributed to holdersof Public Debt or their respective trustees (as defined in Section 7.3(a) of the CreditAgreement) pursuant to Section 7.3 of the Credit Agreement, the Obligations will not bedeemed to be reduced by any such distributions and each Guarantor shall continue to make paymentsunder this Guaranty until such time as the Obligations have been paid in full (and the Commitmenthas been terminated and any LC Exposure reduced to zero), after taking into account any suchdistributions of payments hereunder in report of Indebtedness other than the Obligations.

     Section 7. Waiver. Each Guarantor, to the fullest extent permitted by applicable law,hereby waives notice of acceptance hereof or any presentment, demand, protest or notice of anykind, and any other act or thing, or omission or delay to do any other act or thing, which in anymanner or to any extent might vary the risk of such Guarantor or which otherwise might operate todischarge such Guarantor from its obligations hereunder.

     Section 8. Inability to Accelerate Loan. If the Agent and/or the Lenders areprevented from demanding or accelerating payment thereof by reason of any automatic stay orotherwise, the Agent and/or the Lenders shall be entitled to receive from each Guarantor, upondemand therefor, the sums which otherwise would have been due had such demand or accelerationoccurred.

     Section 9. Reinstatement of Obligations. Each Guarantor agrees that this Guarantyshall continue to be effective or be reinstated, as the case may be, with respect to anyObligations if at any time payment of any such Obligations is rescinded or otherwise must berestored by the Agent and/or the Lenders upon the bankruptcy or reorganization of the Borrower orany Guarantor or otherwise.

     Section 10. Subrogation. Until all of the Obligations shall have been indefeasiblypaid in full, no Guarantor shall have any right of subrogation and each Guarantor hereby waives anyright to enforce any remedy which the Agent and/or the Lenders now have or may hereafter haveagainst the Borrower, and each Guarantor hereby waives any benefit of, and any right to participatein, any security or collateral given to the Agent and the Lenders to secure payment or performanceof any of the Obligations.

     Section 11. Payments Free and Clear. All sums payable by each Guarantor hereunder,whether of principal, interest, fees, expenses, premiums or otherwise, shall be paid in full,without set-off or counterclaim or any deduction or withholding whatsoever (including anywithholding tax or liability imposed by any Governmental Authority, or any Legal Requirementpromulgated thereby), and if any Guarantor is required by such Legal Requirement or by suchGovernmental Authority to make any such deduction or withholding, such Guarantor shall pay to theAgent and the Lenders such additional amount as will result in the receipt by the Agent and theLenders of the full amount payable hereunder had such deduction or withholding not occurred or beenrequired.

     Section 12. Set-off. In addition to any rights now or hereafter granted underapplicable law and not by way of limitation of any such rights, each Lender is hereby authorized byeach

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Guarantor, at any time or from time to time, without notice to any Guarantor or to any otherPerson, any such notice being hereby expressly waived, but subject to receipt of Agent’s priorwritten consent, to set-off and to appropriate and to apply any and all deposits (general orspecial, including, but not limited to, indebtedness evidenced by certificates of deposit, whethermatured or unmatured) and any other indebtedness at any time held or owing by such Lender or anyAffiliate of such Lender, to or for the credit or the account of each Guarantor against and onaccount of any of the Obligations then due and owing after the expiration of any applicable graceperiods. Each Guarantor agrees, to the fullest extent it may effectively do so under applicablelaw, that any holder of a participation in a Note, whether or not acquired pursuant to theapplicable provisions of the Credit Agreement, may exercise rights of setoff or counterclaim andother rights with respect to such participation as fully as if such holder of a participation werea direct creditor of such Guarantor in the amount of such participation.

     Section 13. Subordination. Each Guarantor hereby expressly covenants and agrees forthe benefit of the Agent and the Lenders that all obligations and liabilities of the Borrower orany other Guarantor to such Guarantor of whatever description, including without limitation, allintercompany receivables of such Guarantor from the Borrower or any other Guarantor (collectively,the “Junior Claims”) shall be subordinate and junior in right of payment to all Obligations. If anEvent of Default shall have occurred and be continuing, then no Guarantor shall accept any director indirect payment (in cash, property, securities by setoff or otherwise) from the Borrower or anyother Guarantor on account of or in any manner in respect of any Junior Claim until all of theObligations have been indefeasibly paid in full.

     Section 14. Avoidance Provisions. It is the intent of each Guarantor, the Agent andthe Lenders that in any Proceeding, such Guarantor’s maximum obligation hereunder shall equal, butnot exceed, the maximum amount which would not otherwise cause the obligations of such Guarantorhereunder (or any other obligations of such Guarantor to the Agent and the Lenders) to be avoidableor unenforceable against such Guarantor in such Proceeding as a result of applicable law, includingwithout limitation, (a) Section 548 of the Bankruptcy Code of 1978, as amended (the “BankruptcyCode”) and (b) any state fraudulent transfer or fraudulent conveyance act or statute applied insuch Proceeding, whether by virtue of Section 544 of the Bankruptcy Code or otherwise. Theapplicable laws under which the possible avoidance or unenforceability of the obligations of suchGuarantor hereunder (or any other obligations of such Guarantor to the Agent and the Lenders) shallbe determined in any such Proceeding are referred to as the “Avoidance Provisions”. Accordingly, tothe extent that the obligations of any Guarantor hereunder would otherwise be subject to avoidanceunder the Avoidance Provisions, the maximum Obligations for which such Guarantor shall be liablehereunder shall be reduced to that amount which, as of the time any of the Obligations are deemedto have been incurred under the Avoidance Provisions, would not cause the obligations of anyGuarantor hereunder (or any other obligations of such Guarantor to the Agent and the Lenders), tobe subject to avoidance under the Avoidance Provisions. This Section is intended solely to preservethe rights of the Agent and the Lenders hereunder to the maximum extent that would not cause theobligations of any Guarantor hereunder to be subject to avoidance under the Avoidance Provisions,and no Guarantor nor any other Person shall have any right or claim under this Section as againstthe Agent and the Lenders that would not otherwise be available to such Person under the AvoidanceProvisions.

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     Section 15. Information. Each Guarantor assumes all responsibility for being andkeeping itself informed of the financial condition of the Borrower, of the other Guarantors and ofall other circumstances bearing upon the risk of nonpayment of any of the Obligations and thenature, scope and extent of the risks that such Guarantor assumes and incurs hereunder, and agreesthat none of the Agent or any Lender shall have any duty whatsoever to advise any Guarantor ofinformation regarding such circumstances or risks.

     Section 16. Governing Law. THIS GUARANTY SHALL BE GOVERNED BY, AND CONSTRUED INACCORDANCE WITH, THE LAWS OF THE STATE OF TEXAS.

     SECTION 17. JURISDICTION, VENUE.

     (a) EACH GUARANTOR AGREES THAT THE FEDERAL DISTRICT COURT OF THE SOUTHERN DISTRICT OF TEXAS,HOUSTON DIVISION, OR, AT THE OPTION OF THE AGENT, ANY STATE COURT LOCATED IN HARRIS COUNTY, TEXASSHALL HAVE NON-EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN OR AMONGANY GUARANTOR, THE AGENT OR ANY OF THE LENDERS, PERTAINING DIRECTLY OR INDIRECTLY TO THIS GUARANTYOR ANY OTHER CREDIT DOCUMENT OR TO ANY MATTER ARISING HEREFROM OR THEREFROM OR ANY COLLATERAL. EACHGUARANTOR EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION ORPROCEEDING COMMENCED IN SUCH COURTS. THE CHOICE OF FORUM SET FORTH IN THIS SECTION SHALL NOT BEDEEMED TO PRECLUDE THE BRINGING OF ANY ACTION BY THE AGENT OR ANY LENDER OR THE ENFORCEMENT BY THEAGENT OR ANY LENDER IN ANY OTHER APPROPRIATE JURISDICTION. FURTHER, EACH GUARANTOR IRREVOCABLYWAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION WHICH IT MAY NOW ORHEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT AND ANYCLAIM THAT ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

     (b) THE FOREGOING WAIVERS HAVE BEEN MADE WITH THE ADVICE OF COUNSEL AND WITH A FULLUNDERSTANDING OF THE LEGAL CONSEQUENCES THEREOF, AND SHALL SURVIVE THE PAYMENT OF THE OBLIGATIONSAND ALL OTHER AMOUNTS PAYABLE HEREUNDER OR UNDER THE OTHER CREDIT DOCUMENTS AND THE TERMINATION OFTHIS GUARANTY.

     Section 18. Loan Accounts. The Agent may maintain books and accounts setting forththe amounts of principal, interest and other sums paid and payable with respect to the Obligations,and in the case of any dispute relating to any of the outstanding amount, payment or receipt ofObligation or otherwise, the entries in such account shall be binding upon each Guarantor as to theoutstanding amount of such Obligations and the amounts paid and payable with respect thereto absentmanifest error. The failure of the Agent to maintain such books and accounts shall not in any wayrelieve or discharge any Guarantor of any of its obligations hereunder.

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     Section 19. Waiver of Remedies. No delay or failure on the part of the Agent or theLenders in the exercise of any right or remedy it may have against any Guarantor hereunder orotherwise shall operate as a waiver thereof, and no single or partial exercise by the Agent or theLenders of any such right or remedy shall preclude other or further exercise thereof or theexercise of any other such right or remedy.

     Section 20. Successors and Assigns. Each reference herein to the Agent or theLenders shall be deemed to include such Person’s respective successors and assigns (including, butnot limited to, any holder of the Obligations) in whose favor the provisions of this Guaranty alsoshall inure, and each reference herein to any Guarantor shall be deemed to include the Guarantor’ssuccessors and assigns, upon whom this Guaranty also shall be binding. The Lenders and the Agentmay, in accordance with the applicable provisions of the Credit Agreement, assign, transfer or sellany Obligation, or grant or sell participation in any Obligations, to any Person or entity withoutthe consent of, or notice to, any Guarantor and without releasing, discharging or modifying suchGuarantor’s obligations hereunder. Each Guarantor hereby consents to the delivery by the Agent orany Lender to any assignee, transferee or participant of any financial or other informationregarding the Borrower or any Guarantor. Each Guarantor may not assign or transfer its obligationshereunder to any Person.

     SECTION 21. JOINT AND SEVERAL OBLIGATIONS. THE OBLIGATIONS OF THE GUARANTORSHEREUNDER AND UNDER OTHER CREDIT DOCUMENTS SHALL BE JOINT AND SEVERAL, AND ACCORDINGLY, EACHGUARANTOR CONFIRMS THAT IT IS LIABLE FOR THE FULL AMOUNT OF THE OBLIGATIONS AND ALL OF THEOBLIGATIONS AND LIABILITIES OF EACH OF THE OTHER GUARANTORS HEREUNDER AND UNDER OTHER COURTDOCUMENTS.

     Section 22. Amendments. This Guaranty may not be amended except as provided in theCredit Agreement.

     Section 23. Payments. All payments made by any Guarantor pursuant to this Guarantyshall be made in Dollars, in immediately available funds to the Agent at its Lending Office, notlater than 12:00 noon, New York, New York time on the date one (1) Business Day after demandtherefor.

     Section 24. Notices. All notices, requests and other communications hereunder shallbe in writing and shall be given as provided in the Loan Agreement. Each Guarantor’s address fornotice is set forth below its signature hereto.

     Section 25. Severability. In case any provision of this Guaranty shall be invalid,illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of theremaining provisions shall not in any way be affected or impaired thereby.

     Section 26. Headings. Section headings used in this Guaranty are for convenienceonly and shall not affect the construction of this Guaranty.

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     Section 27. Definitions. (a) For the purposes of this Guaranty:

     “Proceeding” means any of the following: (i) a voluntary or involuntary caseconcerning any Guarantor shall be commenced under the Bankruptcy Code or any other applicablebankruptcy laws; (ii) a custodian (as defined in the Bankruptcy Code or any other applicablebankruptcy laws) is appointed for, or takes charge of, all or any substantial part of the propertyof any Guarantor; (iii) any other proceeding under any applicable law, domestic or foreign,relating to bankruptcy, insolvency, reorganization, winding-up or composition for adjustment ofdebts, whether now or hereafter in effect, is commenced relating to any Guarantor; (iv) anyGuarantor is adjudicated insolvent or bankrupt; (v) any order of relief or other order approvingany such case or proceeding is entered by a court of competent jurisdiction; (vi) any Guarantormakes a general assignment for the benefit of creditors; (vii) any Guarantor shall fail to pay, orshall state that it is unable to pay, or shall be unable to pay, its debts generally as they becomedue; (viii) any Guarantor shall call a meeting of its creditors with a view to arranging acomposition or adjustment of its debts; (ix) any Guarantor shall by any act or failure to actindicate its consent to, approval of or acquiescence in any of the foregoing; or (x) any corporateaction shall be taken by any Guarantor for the purpose of effecting any of the foregoing.

     (b) Terms not otherwise defined herein are used herein with the respective meanings given themin the Credit Agreement.

     IN WITNESS WHEREOF, each Guarantor has duly executed and delivered this Guaranty as of thedate and year first written above.

         
      [Guarantor Signature]
 
       
      Address:
      9200 E. Panorama Circle
      Suite 400
      Englewood, Colorado 80112
      Attention: Corporate Finance

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ASSIGNMENT AND ASSUMPTION

     This Assignment and Assumption (the “Assignment and Assumption”) is dated as of theEffective Date set forth below and is entered into by and between [Insert name of Assignor] (the“Assignor”) and [Insert name of Assignee] (the “Assignee”). Capitalized terms usedbut not defined herein shall have the meanings given to them in the Credit Agreement identifiedbelow (as amended, the “Credit Agreement”), receipt of a copy of which is herebyacknowledged by the Assignee. The Standard Terms and Conditions set forth in Annex 1 attachedhereto are hereby agreed to and incorporated herein by reference and made a part of this Assignmentand Assumption as if set forth herein in full.

     For an agreed consideration, the Assignor hereby irrevocably sells and assigns to theAssignee, and the Assignee hereby irrevocably purchases and assumes from the Assignor, subject toand in accordance with the Standard Terms and Conditions and the Credit Agreement, as of theEffective Date inserted by the Administrative Agent as contemplated below (i) all of the Assignor’srights and obligations in its capacity as a Lender under the Credit Agreement and any otherdocuments or instruments delivered pursuant thereto to the extent related to the amount andpercentage interest identified below of all of such outstanding rights and obligations of theAssignor under the respective facilities identified below (including any letters of credit,guarantees, and swingline loans included in such facilities) and (ii) to the extent permitted to beassigned under applicable law, all claims, suits, causes of action and any other right of theAssignor (in its capacity as a Lender) against any Person, whether known or unknown, arising underor in connection with the Credit Agreement, any other documents or instruments delivered pursuantthereto or the loan transactions governed thereby or in any way based on or related to any of theforegoing, including contract claims, tort claims, malpractice claims, statutory claims and allother claims at law or in equity related to the rights and obligations sold and assigned pursuantto clause (i) above (the rights and obligations sold and assigned pursuant to clauses (i) and (ii)above being referred to herein collectively as the “Assigned Interest”). Such sale andassignment is without recourse to the Assignor and, except as expressly provided in this Assignmentand Assumption, without representation or warranty by the Assignor.

         
1.
  Assignor:    
       
 
       
2.
  Assignee:    
       
 
    [and is an Affiliate/Approved Fund of [identify Lender]1]  
 
       
3.
  Borrower: Archstone-Smith Operating Trust  
 
       
4.
  Administrative Agent: JPMorgan Chase Bank, N.A., as the administrative agent under the Credit Agreement
 
       
5.
  Credit Agreement: [The Amended and Restated Credit Agreement dated as of December 13, 2004 among Archstone-SmithOperating Trust, the Lenders parties thereto, JPMorgan Chase Bank, N.A., as AdministrativeAgent, and the other lenders parties thereto]

1 Select as applicable.

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6.   Assigned Interest:
                                   
 
        Aggregate Amount of       Amount of            
        Commitment/Loans for       Commitment/Loans       Percentage Assigned of    
  Facility Assigned2     all Lenders       Assigned       Commitment/Loans3    
 
 
    $         $           %    
 
 
    $         $           %    
 
 
    $         $           %    
 

Effective Date: _____________ ___, 20___ [TO BE INSERTED BY ADMINISTRATIVE AGENT AND WHICH SHALLBE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.]

The terms set forth in this Assignment and Assumption are hereby agreed to:

             
    ASSIGNOR
 
           
    [NAME OF ASSIGNOR]
 
           
  By:        
           
   Title:        
 
           
    ASSIGNEE
 
           
    [NAME OF ASSIGNEE]
 
           
  By:        
           
   Title:        

2 Fill in the appropriate terminology for the types offacilities under the Credit Agreement that are being assigned under thisAssignment (e.g. “Revolving Commitment,” “Tranche A Commitment,” “Tranche BCommitment,” etc.)
 
3 Set forth, to at least 9 decimals, as a percentage of theCommitment/Loans of all Lenders thereunder.

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[Consented to and]4 Accepted:

JPMORGAN CHASE BANK, N.A.,as
Administrative Agent

     
By
   
   
 Title:
   

[Consented to:]5

[NAME OF RELEVANT PARTY]

     
By
   
   
 Title:
   

4 To be added only if the consent of the AdministrativeAgent is required by the terms of the Credit Agreement.
 
5 To be added only if the consent of the Borrower and/orother parties (e.g. Swingline Lender, Issuing Bank) is required by the terms ofthe Credit Agreement.

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ANNEX 1

STANDARD TERMS AND CONDITIONS FOR
ASSIGNMENT AND ASSUMPTION

     1. Representations and Warranties.

     1.1 Assignor. The Assignor (a) represents and warrants that (i) it is the legal andbeneficial owner of the Assigned Interest, (ii) the Assigned Interest is free and clear of anylien, encumbrance or other adverse claim and (iii) it has full power and authority, and has takenall action necessary, to execute and deliver this Assignment and Assumption and to consummate thetransactions contemplated hereby; and (b) assumes no responsibility with respect to (i) anystatements, warranties or representations made in or in connection with the Credit Agreement or anyother Loan Document, (ii) the execution, legality, validity, enforceability, genuineness,sufficiency or value of the Loan Documents or any collateral thereunder, (iii) the financialcondition of the Borrower, any of its Subsidiaries or Affiliates or any other Person obligated inrespect of any Loan Document or (iv) the performance or observance by the Borrower, any of itsSubsidiaries or Affiliates or any other Person of any of their respective obligations under anyLoan Document.

     1.2. Assignee. The Assignee (a) represents and warrants that (i) it has full powerand authority, and has taken all action necessary, to execute and deliver this Assignment andAssumption and to consummate the transactions contemplated hereby and to become a Lender under theCredit Agreement, (ii) it satisfies the requirements, if any, specified in the Credit Agreementthat are required to be satisfied by it in order to acquire the Assigned Interest and become aLender, (iii) from and after the Effective Date, it shall be bound by the provisions of the CreditAgreement as a Lender thereunder and, to the extent of the Assigned Interest, shall have theobligations of a Lender thereunder, (iv) it has received a copy of the Credit Agreement, togetherwith copies of the most recent financial statements delivered pursuant to Section 5.2 thereof, asapplicable, and such other documents and information as it has deemed appropriate to make its owncredit analysis and decision to enter into this Assignment and Assumption and to purchase theAssigned Interest on the basis of which it has made such analysis and decision independently andwithout reliance on the Administrative Agent or any other Lender, and (v) if it is a ForeignLender, attached to the Assignment and Assumption is any documentation required to be delivered byit pursuant to the terms of the Credit Agreement, duly completed and executed by the Assignee; and(b) agrees that (i) it will, independently and without reliance on the Administrative Agent, theAssignor or any other Lender, and based on such documents and information as it shall deemappropriate at the time, continue to make its own credit decisions in taking or not taking actionunder the Loan Documents, and (ii) it will perform in accordance with their terms all of theobligations which by the terms of the Loan Documents are required to be performed by it as aLender.

     2. Payments. From and after the Effective Date, the Administrative Agent shall makeall payments in respect of the Assigned Interest (including payments of principal, interest, feesand other amounts) to the Assignor for amounts which have accrued to but excluding the EffectiveDate and to the Assignee for amounts which have accrued from and after the Effective Date.

     3. General Provisions. This Assignment and Assumption shall be binding upon, andinure to the benefit of, the parties hereto and their respective successors and assigns. ThisAssignment and Assumption may be executed in any number of counterparts, which together shallconstitute one instrument. Delivery of an executed counterpart of a signature page of thisAssignment and Assumption by telecopy shall be effective as delivery of a manually executedcounterpart of this Assignment and Assumption. This Assignment and Assumption shall be governedby, and construed in accordance with, the law of the State of Texas.

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GUARANTY OF COLLECTION

     THIS GUARANTY (this “Guaranty”), dated as of ___is made by ___(the “Guarantor”), in favor of (a) JPMorgan Chase Bank, N.A., in its capacity as AdministrativeAgent (the “Agent”) for the Lenders under that certain Amended and Restated Credit Agreement datedas of December 13, 2004 by and among Archstone-Smith Operating Trust (the “Borrower”), thefinancial institutions party thereto and their assignees in accordance therewith (the “Lenders”),and the Agent (as the same may be amended, restated, supplemented, or otherwise modified from timeto time in accordance with its terms, the “Credit Agreement”) and (b) the Lenders.

     PRELIMINARY STATEMENT. Capitalized terms not otherwise defined herein shall have therespective meanings assigned thereto under the Credit Agreement. The Guarantor is a beneficialcommon unitholder of the Borrower and therefore the Guarantor has determined that the making of theLoan by the Lenders benefited, directly or indirectly, the Guarantor. If other beneficial commonunitholders of the Borrower have entered into similar guaranty agreements (the “Other Guarantees”)with the Agent as this Guaranty, they shall be referred to in this Guaranty as the “OtherGuarantors.”

     NOW, THEREFORE, in consideration of the premises, the Guarantor hereby agrees as follows:

     SECTION 1. Guaranty. This guaranty constitutes a limited guaranty of collection. TheGuarantor hereby guarantees the punctual collection when due, on a several basis, whether at statedmaturity, by demand, acceleration or otherwise, of (a) that portion of the principal and interestoutstanding on the indebtedness of the Borrower under the Credit Agreement that remains outstandingequal to $ ___[THIS NUMBER IS INTENDED TO BE THE ACTUAL AMOUNT OF GUARANTEE] less suchamounts as the Agent has collected upon exercising all rights, assertion of all claims and demandsand enforcement of all remedies available to it (other than this Guaranty and the Other Guarantees)under the Credit Documents, and (b) reasonable attorney’s fees and all costs and expenses incurredin enforcing any rights under this Guaranty (such obligations being the “Obligations”). Anobjective of this guaranty is that the Obligation shall be a “recourse liability” as defined inTreasury Regulation §1.752-1(a)(1), and the Guarantor shall bear the economic risk of loss withrespect to such portion of the liabilities as is equal to the Obligations within the meaning ofTreasury Regulation §1.752-2.

     SECTION 2. Guaranty Absolute. The Guarantor hereby guarantees that the Obligationswill be paid strictly in accordance with their terms, regardless of any law, regulation or ordernow or hereafter in effect in any jurisdiction affecting any of such terms or the rights of theAgent with respect thereto. The liability of the Guarantor under this Guaranty shall be absoluteand unconditional irrespective of:

  (a)   Any lack of validity or enforceability of the Credit Agreement or any otherCredit Documents or agreement relating thereto or executed in connection therewith;
 
  (b)   Any change in the time, manner or place of payment of, or in any other term of,all or any of the Obligations or any other amendment or waiver of or any consent

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to any departure from the Credit Agreement, any other Credit Documents or any otherdocuments or agreement relating thereto or executed in connection therewith;

  (c)   Any exchange, release or non-perfection of any other collateral, or any releaseor amendment or waiver of or consent to departure from any guaranty, for all or any ofthe Obligations; or
 
  (d)   Any other circumstance which might otherwise constitute a defense available to,or a discharge of, the Borrower, any subsidiary of Borrower or any other person that isa party to the Credit Agreement, any other Credit Documents or any other document oragreement related thereto or executed in connection therewith (including any guarantor)in respect to the Obligations.

This Guaranty shall continue to be effective or be reinstated, as the case may be, if at any timeany payment of any of the Obligations is rescinded or must otherwise be returned by the Agent orany Lender upon the insolvency, bankruptcy or reorganization of the Borrower or Guarantor orotherwise, all as though such payment had not been made. The obligations of the Guarantor underthis Guaranty shall not be subject to reduction, termination or other impairment by reason of anysetoff, recoupment, counterclaim or defense or for any other reason. This Guaranty is to be inaddition to and is not to prejudice or be prejudiced by any other securities or guaranties(including any guaranty signed by the Guarantor) which the Agent may now or hereafter hold from oron account of the Borrower and is to be binding on the Guarantor as a continuing guarantynotwithstanding any payments from time to time made to the Agent or any settlement of account ordisability or incapacity affecting the Guarantor or any other thing whatsoever.

     SECTION 3. Representations and Warranties. Guarantor hereby represents and warrantsthat it has the requisite power and authority to execute and deliver and to carry out this Guarantyand the transactions contemplated herein; and to perform its obligations hereunder. This Guarantyhas been duly and validly executed and delivered by the Guarantor and constitutes a valid andlegally binding agreement of the Guarantor, enforceable in accordance with its terms.

     SECTION 4. Waiver. The Guarantor waives any notice with respect to any of theObligations and this Guaranty (it being the understanding of the Agent and the Guarantor that thisGuaranty is a guaranty of collection and not of payment).

     SECTION 5. No Subrogation. The Guarantor will not exercise any rights which it mayacquire by way of subrogation under this Guaranty or in respect of any security for theObligations, by any payment made hereunder or otherwise.

     SECTION 6. Amendments, Etc. No amendment or waiver of any provision of this Guarantynor consent to any departure by the Guarantor herefrom, shall be effective unless the same is inwriting and signed by the Agent and then such waiver or consent shall be effective only in thespecific instance and for the specific purpose for which given.

     SECTION 7. Notices. Except as otherwise expressly provided herein, all notices andother communications provided for hereunder shall be in writing or by facsimile, telegraph or

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cable and mailed or sent or delivered as to each party hereto at the address for notices setforth under its name on the signature page hereof or, in the case of each party, at such otheraddress as shall be designated by such party in a written notice to all other parties. All suchnotices and other communications shall be effective when received, and in the case of notice byfacsimile, telegraph or cable, when sent, and upon receipt of an answer back, in each caseaddressed as set forth above.

     SECTION 8. No Waiver; Cumulative Remedies. No failure on the part of the Agent or anyLender to exercise, and no delay in exercising, any right hereunder shall operate as a waiverthereof; nor shall any single or partial exercise of any such right preclude any other or furtherexercise thereof or the exercise of any other right. The remedies herein provided are cumulativeand not exclusive of any remedies provided by law.

     SECTION 9. Absolute and Continuing Guaranty. This Guaranty is an absolute andcontinuing guaranty and shall (a) remain in full force and effect until full payment of theObligations or all amounts payable under this Guaranty, (b) be binding upon the Guarantor and itssuccessors and assigns, and (c) inure to the benefit of the Agent and its successors and assigns.

     SECTION 10. Savings Clause. Nothing herein is intended to contract for, take,reserve, charge or receive interest or other consideration for the use, forbearance or detention ofmoney at a rate in excess of the highest rate permitted by applicable laws (“Highest Lawful Rate”)nor shall the Guarantor be required to pay unearned interest. If any amount payable by theGuarantor hereunder is deemed to constitute unearned interest or if the Agent shall receive fromthe Guarantor any monies that are deemed to constitute interest at a rate in excess of the HighestLawful Rate, then (a) the amount of interest which would otherwise be payable under this Guarantyshall be reduced to the amount allowed under applicable law, and (b) any unearned interest paid bythe Guarantor or any interest paid by the Guarantor in excess of the Highest Lawful Rate shall, atthe option of the Agent, be either refunded to the Guarantor or credited against the amountspayable by the Guarantor hereunder, in such order as the Agent shall determine.

     SECTION 11. Governing Law. This Guaranty shall be deemed to be executed by theparties hereto under the laws of the State of Texas, and shall be construed in accordance with thelaws of Texas and applicable federal law.

     SECTION 12. Waiver of Suretyship Rights. By signing this Guaranty, Guarantor WAIVESeach and every right to which it may be entitled by virtue of any suretyship law, including anyrights it may have pursuant to Rule 31 of the Texas Rules of Civil Procedure, §17.001 of the TexasCivil Practice and Remedies Code and Chapter 34 of the Texas Business and Commerce Code, as thesame may be amended from time to time.

     SECTION 13. Release of Claims. Guarantor hereby releases, discharges and acquitsforever Agent, Lenders and their respective officers, directors, trustees, agents, employees andcounsel (in each case, past, present or future) from any and all Claims existing as of the datehereof (or the date of actual execution hereof by Guarantor, if later). As used herein, the term“Claim” shall mean any and all liabilities, claims, defenses, demands, actions, causes ofaction,

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judgments, deficiencies, interest, liens, costs or expenses (including court costs, penalties,attorneys’ fees and disbursements, and amounts paid in settlement) of any kind and characterwhatsoever, including claims for usury, breach of contract, breach of commitment, negligentmisrepresentation or failure to act in good faith, in each case whether now known or unknown,suspected or unsuspected, asserted or unasserted or primary or contingent, and whether arising outof written documents, unwritten undertakings, course of conduct, tort, violations of laws orregulations or otherwise. To the maximum extent permitted by applicable law, Guarantor herebywaives all rights, remedies, claims and defenses based upon or related to Sections 51.003,51.004 and 51.005 of the Texas Property Code, to the extent the same pertain or maypertain to any enforcement of this Guaranty.

     IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be duly executed and deliveredas of the date first above written.

             
    [Name of Guarantor]
 
           
  By:        
           
  Name:        
           
  Title:        
           
 
           
    [Address of Guarantor]

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