HUDSON PACIFIC PROPERTIES, L.P. 3.98% Series D Guaranteed Senior Notes due July 6, 2026 3.66% Series E Guaranteed Senior Notes due September 15, 2023 NOTE PURCHASE AGREEMENT Dated as of July 6, 2016

Exhibit 10.8

EXECUTION VERSION

XXXXXX PACIFIC PROPERTIES, L.P.

$200,000,000

3.98% Series D Guaranteed Senior Notes due July 6, 2026

3.66% Series E Guaranteed Senior Notes due September 15, 2023

______________

NOTE PURCHASE AGREEMENT

______________

Dated as of July 6, 2016

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TABLE OF CONTENTS

SECTION HEADING PAGE



Section 1. Authorization of Notes	1
Section 2. Sale and Purchase of Notes	1
Section 2.1. Sale and Purchase of Notes	1
Section 2.2. Guaranty	2
Section 3. Closings	2
Section 4. Conditions to Closings	2
Section 4.1. Representations and Warranties	2
Section 4.2. Performance; No Default	3
Section 4.3. Compliance Certificates	3
Section 4.4. Opinions of Counsel	4
Section 4.5. Purchase Permitted By Applicable Law, Etc	4
Section 4.6. Sale of Other Notes	4
Section 4.7. Payment of Special Counsel Fees	4
Section 4.8. Private Placement Numbers	4
Section 4.9. Changes in Corporate Structure	4
Section 4.10. Funding Instructions	5
Section 4.11. Parent Guaranty	5
Section 4.12. Material Credit Facilities	5
Section 4.13. Proceedings and Documents	5
Section 5. Representations and Warranties of the Company	5
Section 5.1. Organization; Power and Authority	5
Section 5.2. Authorization, Etc	6
Section 5.3. Disclosure	6
Section 5.4. Organization and Ownership of Shares of Subsidiaries; Affiliates	7
Section 5.5. Financial Statements; Material Liabilities	7
Section 5.6. Compliance with Laws, Other Instruments, Etc	8
Section 5.7. Governmental Authorizations, Etc	8
Section 5.8. Litigation; Observance of Agreements, Statutes and Orders	8
Section 5.9. Taxes	9
Section 5.10. Title to Property; Leases	9
Section 5.11. Licenses, Permits, Etc	10
Section 5.12. Compliance with ERISA	10
Section 5.13. Private Offering by the Company	11
Section 5.14. Use of Proceeds; Margin Regulations	11
Section 5.15. Existing Indebtedness; Future Liens	12
Section 5.16. Foreign Assets Control Regulations, Etc	12
Section 5.17. Status under Certain Statutes	14
Section 5.18. Environmental Matters	14
Section 5.19. Solvency	15
Section 5.20. Unencumbered Pool Properties	15
Section 6. Representations of the Purchasers	15



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SECTION HEADING PAGE



Section 6.1. Purchase for Investment	15
Section 6.2. Source of Funds	15
Section 6.3. Accredited Investor	17
Section 7. Information as to Xxxxxx REIT and the Company	17
Section 7.1. Financial and Business Information	17
Section 7.2. Officer’s Certificate	20
Section 7.3. Visitation	21
Section 7.4. Electronic Delivery	22
Section 8. Payment and Prepayment of the Notes	22
Section 8.1. Maturity	22
Section 8.2. Optional Prepayments with Make-Whole Amount	22
Section 8.3. Allocation of Partial Prepayments	23
Section 8.4. Maturity; Surrender, Etc.	23
Section 8.5. Purchase of Notes	23
Section 8.6. Make-Whole Amount	24
Section 8.7. Offer to Prepay Notes in the Event of a Change in Control	25
Section 8.8. Payments Due on Non-Business Days	27
Section 9. Affirmative Covenants	27
Section 9.1. Compliance with Laws	27
Section 9.2. Insurance	27
Section 9.3. Maintenance of Properties	28
Section 9.4. Payment of Taxes and Claims	28
Section 9.5. Corporate Existence, Etc	28
Section 9.6. Books and Records	28
Section 9.7. REIT Status	29
Section 9.8. Exchange Privileges	29
Section 9.9. Subsidiary Guarantors	29
Section 9.10. Most Favored Lender Provision	30
Section 9.11. Line of Business	30
Section 10. Negative Covenants	31
Section 10.1. Transactions with Affiliates	31
Section 10.2. Merger, Consolidation, Etc	31
Section 10.3. Terrorism Sanctions Regulations	32
Section 10.4. Liens	32
Section 10.5. Financial Covenants	33
Section 10.6. Restrictions on Intercompany Transfers	34
Section 10.7. Modifications of Organizational Documents	35
Section 10.8. Derivatives Contracts	35
Section 10.9. Xxxxxx REIT Ownership and Management of the Company	35
Section 11. Events of Default	35
Section 12. Remedies on Default, Etc	38
Section 12.1. Acceleration	38
Section 12.2. Other Remedies	39



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SECTION HEADING PAGE



Section 12.3. Rescission	39
Section 12.4. No Waivers or Election of Remedies, Expenses, Etc	39
Section 13. Registration; Exchange; Substitution of Notes	40
Section 13.1. Registration of Notes	40
Section 13.2. Transfer and Exchange of Notes	40
Section 13.3. Replacement of Notes	40
Section 14. Payments on Notes	41
Section 14.1. Place of Payment	41
Section 14.2. Home Office Payment	41
Section 15. Expenses, Etc	41
Section 15.1. Transaction Expenses	41
Section 15.2. Survival	42
Section 16. Survival of Representations and Warranties; Entire Agreement	42
Section 17. Amendment and Waiver	43
Section 17.1. Requirements	43
Section 17.2. Solicitation of Holders of Notes	43
Section 17.3. Binding Effect, Etc	44
Section 17.4. Notes Held by Company, Etc	44
Section 18. Notices	44
Section 19. Reproduction of Documents	45
Section 20. Confidential Information	45
Section 21. Substitution of Purchaser	46
Section 22. Miscellaneous	46
Section 22.1. Successors and Assigns	46
Section 22.2. Accounting Terms	47
Section 22.3. Severability	47
Section 22.4. Construction, Etc	47
Section 22.5. Counterparts	47
Section 22.6. Governing Law	48
Section 22.7. Jurisdiction and Process; Waiver of Jury Trial	48



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Schedule A	—	Defined Terms

Schedule 1(a)	—	Form of 3.98% Series D Guaranteed Senior Note due July 6, 2026

Schedule 1(b)	—	Form of 3.66% Series E Guaranteed Senior Note due September 15, 2023

Schedule 4.4(a)(1)	—	Form of Opinion of Special Counsel for Xxxxxx REIT and the Company

Schedule 4.4(a)(2)	—	Form of Opinion of Special Maryland Counsel for Xxxxxx REIT and the Company

Schedule 4.4(b)	—	Form of Opinion of Special Counsel for the Purchasers

Schedule 5.3	—	Disclosure Materials

Schedule 5.4	—	Subsidiaries of Xxxxxx REIT and Ownership of Subsidiary Stock

Schedule 5.5	—	Financial Statements

Schedule 5.10(a)	—	Properties; Liens

Schedule 5.15	—	Existing Indebtedness

Schedule B	—	Information Relating to Purchasers

Exhibit PG	—	Form of Parent Guaranty

Exhibit SG	—	Form of Subsidiary Guaranty

XXXXXX PACIFIC PROPERTIES, L.P.

00000 Xxxxxxxx Xxxx., 0xx Xxxxx

Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000

3.98% Series D Guaranteed Senior Notes due July 6, 2026

3.66% Series E Guaranteed Senior Notes due September 15, 2023

Dated as of July 6, 2016

TO EACH OF THE PURCHASERS

LISTED IN SCHEDULE B HERETO:

Ladies and Gentlemen:

XXXXXX PACIFIC PROPERTIES, L.P., a Maryland limited partnership (together with any successor thereto that becomes a party hereto pursuant to Section 10.2, the “Company”), agrees with each of the Purchasers as follows:


SECTION 1.	AUTHORIZATION OF NOTES.

The Company will authorize the issue and sale of $200,000,000 aggregate principal amount of its Guaranteed Senior Notes, of which $150,000,000 aggregate principal amount shall be its 3.98% Series D Guaranteed Senior Notes due July 6, 2026 (the “Series D Notes”), and $50,000,000 aggregate principal amount shall be its 3.66% Series E Guaranteed Senior Notes due September 15, 2023 (the “Series E Notes”; the Series D Notes and the Series E Notes, as amended, restated or otherwise modified from time to time pursuant to Section 17 and including any such notes issued in substitution therefor pursuant to Section 13, the “Notes”). The Notes shall be substantially in the respective forms set out in Schedule 1(a) and 1(b). Certain capitalized and other terms used in this Agreement are defined in Schedule A. References to a “Schedule” or an “Exhibit” are references to a Schedule or an Exhibit attached to this Agreement unless otherwise specified. References to a “Section” are references to a Section of this Agreement unless otherwise specified.


SECTION 2.	SALE AND PURCHASE OF NOTES.

Section 2.1. Sale and Purchase of Notes. Subject to the terms and conditions of this Agreement, the Company will issue and sell to each Purchaser and each Purchaser will purchase from the Company, at the Closings provided for in Section 3, Notes of the series and in the principal amount specified opposite such Purchaser’s name in Schedule B at the purchase price of 100% of the principal amount thereof. The Purchasers’ obligations hereunder are several and not joint

obligations and no Purchaser shall have any liability to any Person for the performance or non-performance of any obligation by any other Purchaser hereunder.

Section 2.2. Guaranty. The obligations of the Company hereunder and under the Notes shall have the benefit of that certain Guaranty Agreement to be dated as of the First Closing Date from Xxxxxx REIT (as the same may be amended, supplemented, restated or otherwise modified from time to time, the “Parent Guaranty”) substantially in the form of Exhibit PG.


SECTION 3.	CLOSINGS.

The execution and delivery of this Agreement and the sale and purchase of the Series D Notes (the “First Closing”) shall occur at 11:00 a.m. New York, New York time on July 6, 2016 (the “First Closing Date”) at the offices of Xxxxxx Xxxxxx LLP, 000 Xxxxx Xxxxxx, 00^xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 or on such other Business Day thereafter on or prior to July 8^th, 2016 as may be agreed upon by the Company and the Purchasers. The sale and purchase of the Series E Notes (the “Second Closing” and, together with the First Closing, each, a “Closing”) shall occur at 11:00 a.m. New York, New York time on September 15, 2016 (or such other date as provided in the immediately succeeding sentence, the “Second Closing Date” and, together with the First Closing Date, each, a “Closing Date”) at the offices of Xxxxxx Xxxxxx LLP, 000 Xxxxx Xxxxxx, 00^xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000. The date or time of the Second Closing may be changed to such other Business Day as may be agreed upon by the Company and the Purchasers purchasing Notes at such Closing. At each Closing, the Company will deliver to each Purchaser the Notes of the series to be purchased by such Purchaser at such Closing in the form of a single Note of such series (or such greater number of Notes of such series in denominations of at least $100,000 as such Purchaser may request) dated the date of such Closing and registered in such Purchaser’s name (or in the name of its nominee), against delivery by such Purchaser to the Company or its order of immediately available funds in the amount of the purchase price therefor by wire transfer to the account of the Company set forth in the funding instructions delivered by the Company in accordance with Section 4.10. If at a Closing the Company shall fail to tender such Notes to any Purchaser as provided above in this Section 3, or any of the conditions specified in Section 4 shall not have been fulfilled to such Purchaser’s satisfaction, such Purchaser shall, at its election, be relieved of all further obligations under this Agreement, without thereby waiving any rights such Purchaser may have by reason of any of the conditions specified in Section 4 not having been fulfilled to such Purchaser’s satisfaction or such failure by the Company to tender such Notes.


SECTION 4.	CONDITIONS TO CLOSINGS.

Each Purchaser’s obligation to purchase and pay for the Notes to be sold to such Purchaser at a Closing is subject to the fulfillment to such Purchaser’s satisfaction, prior to or at such Closing, of the following conditions:

Section 4.1. Representations and Warranties.

(a) Representations and Warranties of the Company. The representations and warranties of the Company in this Agreement shall be correct on the First Closing Date. The representations and warranties of the Company contained in Sections 5.1, 5.2, 5.3, 5.5, 5.13, 5.14, 5.16, 5.17 and

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5.19 shall be correct on the Second Closing Date, and all other representations and warranties of the Company in this Agreement shall be correct in all material respects on the Second Closing Date (except to the extent any such representation and warranty includes a materiality, Material or Material Adverse Effect qualifier, in which case it shall be true and correct in all respects); provided that, with respect to the Second Closing only, the Company shall be permitted to make additions and deletions to Schedules 5.4 and/or 5.15 after the First Closing Date but prior to the Second Closing Date (and any reference herein to any such Schedule shall be deemed to be a reference to such Schedule as so modified), so long as (i) the Company shall have provided an updated copy of the relevant Schedules to each Purchaser not less than five Business Days prior to the Second Closing Date and (ii)(A) in the case of Schedule 5.4, any such additions or deletions are not adverse to the interests of the Purchasers in any material respect and (B) in the case of Schedule 5.15, after giving effect to such additions and deletions, immediately before and immediately after giving effect to the issue and sale of the Notes, the Company shall be in compliance with Section 10.5 and each Additional Covenant then in effect.

(b) Representations and Warranties of Xxxxxx REIT. The representations and warranties of Xxxxxx REIT in the Parent Guaranty shall be correct (1) on the First Closing Date and (2) with respect to the Second Closing only, in all material respects on the Second Closing Date (except to the extent any such representation and warranty includes a materiality, Material or Material Adverse Effect qualifier, in which case it shall be true and correct in all respects).

Section 4.2. Performance; No Default. Xxxxxx REIT and the Company shall have performed and complied with all agreements and conditions contained in this Agreement and the Parent Guaranty required to be performed or complied with by it prior to or at such Closing, and before and after giving effect to the issue and sale of the Notes (and the application of the proceeds thereof as contemplated by Section 5.14), no Default or Event of Default shall have occurred and be continuing. Neither Xxxxxx REIT, the Company nor any Subsidiary shall have entered into any transaction since the date of the Memorandum that would have been prohibited by Section 10 had such Section applied since such date.

Section 4.3. Compliance Certificates.

(a) Officer’s Certificate of the Company. The Company shall have delivered to such Purchaser an Officer’s Certificate, dated the date of such Closing, certifying that the conditions specified in Sections 4.1, 4.2 and 4.9 have been fulfilled.

(b) Secretary’s Certificate of the Company. The Company shall have delivered to such Purchaser a certificate of its Secretary or Assistant Secretary, dated the date of such Closing, certifying as to (1) the resolutions attached thereto and other limited partnership proceedings relating to the authorization, execution and delivery of the Notes and this Agreement and (2) the Company’s organizational documents as then in effect.

(c) Officer’s Certificate of Xxxxxx REIT. Xxxxxx REIT shall have delivered to such Purchaser an Officer’s Certificate, dated the date of such Closing, certifying as to Xxxxxx REIT that the conditions specified in Sections 4.1(b), 4.2 and 4.9 have been fulfilled.

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(d) Secretary’s Certificate of Xxxxxx REIT. Xxxxxx REIT shall have delivered to such Purchaser a certificate of its Secretary or Assistant Secretary, dated the date of such Closing, certifying as to (1) the resolutions attached thereto and other corporate proceedings relating to the authorization, execution and delivery of the Parent Guaranty and (2) Xxxxxx REIT’s organizational documents as then in effect.

Section 4.4. Opinions of Counsel. Such Purchaser shall have received opinions in form and substance satisfactory to such Purchaser, dated the date of such Closing (a) from (1) Xxxxxx & Xxxxxxx LLP, counsel for Xxxxxx REIT and the Company, covering the matters set forth in Schedule 4.4(a)(1) and covering such other customary matters incident to the transactions contemplated hereby as such Purchaser or its counsel may reasonably request, and (2) Xxxxxxx LLP, special Maryland counsel for Xxxxxx REIT and the Company, covering the matters set forth in Schedule 4.4(a)(2) and covering such other customary matters incident to the transactions contemplated hereby as such Purchaser or its counsel may reasonably request (and the Company hereby instructs its counsel to deliver such opinions to the Purchasers) and (b) from Xxxxxx Xxxxxx LLP, the Purchasers’ special counsel in connection with such transactions, substantially in the form set forth in Schedule 4.4(b) and covering such other matters incident to such transactions as such Purchaser may reasonably request.

Section 4.5. Purchase Permitted By Applicable Law, Etc. On the applicable Closing Date, such Purchaser’s purchase of Notes shall (a) be permitted by the laws and regulations of each jurisdiction to which such Purchaser is subject, without recourse to provisions (such as section 1405(a)(8) of the New York Insurance Law) permitting limited investments by insurance companies without restriction as to the character of the particular investment, (b) not violate any applicable law or regulation (including, without limitation, Regulation T, U or X of the Board of Governors of the Federal Reserve System) and (c) not subject such Purchaser to any tax, penalty or liability under or pursuant to any applicable law or regulation, which law or regulation was not in effect on the date of this Agreement. If requested by such Purchaser at least five Business Days prior to the date of such Closing, such Purchaser shall have received an Officer’s Certificate certifying as to such matters of fact as such Purchaser may reasonably specify to enable such Purchaser to determine whether such purchase is so permitted.

Section 4.6. Sale of Other Notes. Contemporaneously with such Closing, the Company shall sell to each other Purchaser and each other Purchaser shall purchase the Notes to be purchased by it at such Closing as specified in Schedule B.

Section 4.7. Payment of Special Counsel Fees. Without limiting Section 15.1, the Company shall have paid on or before the date of such Closing the reasonable and documented fees, charges and disbursements of the Purchasers’ special counsel referred to in Section 4.4(b) to the extent reflected in a statement of such counsel rendered to the Company at least two Business Days prior to such date.

Section 4.8. Private Placement Numbers. A Private Placement Number issued by Standard & Poor’s CUSIP Service Bureau (in cooperation with the SVO) shall have been obtained for each series of the Notes.

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Section 4.9. Changes in Corporate Structure. Neither Xxxxxx REIT nor the Company shall have changed its jurisdiction of incorporation or organization, as applicable, or been a party to any merger or consolidation or succeeded to all or any substantial part of the liabilities of any other entity, at any time following the date of the most recent financial statements referred to in Schedule 5.5.

Section 4.10. Funding Instructions. At least three Business Days prior to the date of such Closing, such Purchaser shall have received written instructions signed by a Responsible Officer on letterhead of the Company directing the manner of payment of the purchase price for the Notes and setting forth (a) the name and address of the transferee bank, (b) such transferee bank’s ABA number and (c) the account name and number into which the purchase price for the Notes is to be deposited.

Section 4.11. Parent Guaranty. Such Purchaser shall have received a copy of the Parent Guaranty which shall have been duly authorized, executed and delivered by Xxxxxx REIT.

Section 4.12. Material Credit Facilities. Such Purchaser or its special counsel shall have received a copy of each Material Credit Facility as in effect on the date of such Closing, which copy shall be certified as true, correct and complete and which certificate shall identify each Additional Covenant then in effect in such Material Credit Facility.

Section 4.13. Proceedings and Documents. All corporate, limited partnership and other proceedings in connection with the transactions contemplated by this Agreement and all documents and instruments incident to such transactions shall be reasonably satisfactory to such Purchaser and its special counsel, and such Purchaser and its special counsel shall have received all such counterpart originals or certified or other copies of such documents as such Purchaser or such special counsel may reasonably request.


SECTION 5.	REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

The Company represents and warrants to each Purchaser on the date of this Agreement and on the date of each Closing that:

Section 5.1. Organization; Power and Authority.

(a) The Company is a limited partnership duly organized, validly existing and in good standing under the laws of its jurisdiction of organization, and is duly qualified as a foreign limited partnership and is in good standing in each jurisdiction in which such qualification is required by law, other than those jurisdictions as to which the failure to be so qualified or in good standing could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. The Company has the limited partnership power and authority to own or hold under lease the properties it purports to own or hold under lease, to transact the business it transacts and proposes to transact, to execute and deliver this Agreement and the Notes and to perform the provisions hereof and thereof.

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(b) Xxxxxx REIT is a corporation duly organized, validly existing and in good standing under the laws of its jurisdiction of incorporation, and is duly qualified as a foreign corporation and is in good standing in each jurisdiction in which such qualification is required by law, other than those jurisdictions as to which the failure to be so qualified or in good standing could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. Xxxxxx REIT has the corporate power and authority to own or hold under lease the properties it purports to own or hold under lease, to transact the business it transacts and proposes to transact, to execute and deliver the Parent Guaranty and to perform the provisions thereof.

Section 5.2. Authorization, Etc.

(a) This Agreement and the Notes have been duly authorized by all necessary limited partnership action on the part of the Company, and this Agreement constitutes, and upon execution and delivery thereof each Note will constitute, a legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except as such enforceability may be limited by (1) applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors’ rights generally and (2) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).

(b) The Parent Guaranty has been duly authorized by all necessary corporate action on the part of Xxxxxx REIT, and the Parent Guaranty constitutes a legal, valid and binding obligation of Xxxxxx REIT enforceable against Xxxxxx REIT in accordance with its terms, except as such enforceability may be limited by (1) applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors’ rights generally and (2) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).

Section 5.3. Disclosure. The Company, through its agents, Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated and Xxxxx Fargo Securities, LLC, has delivered to each Purchaser a copy of a Private Placement Memorandum, dated June 2016 (the “Memorandum”), relating to the transactions contemplated hereby. The Memorandum fairly describes, in all material respects, the general nature of the business and principal properties of Xxxxxx REIT and its Subsidiaries. This Agreement, the Memorandum, the financial statements listed in Schedule 5.5 and the documents, certificates or other writings delivered to the Purchasers by or on behalf of the Company prior to June 22, 2016 in connection with the transactions contemplated hereby and identified in Schedule 5.3 (this Agreement, the Memorandum and such documents, certificates or other writings and such financial statements delivered to each Purchaser being referred to, collectively, as the “Disclosure Documents”), taken as a whole, do not contain any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein not misleading in light of the circumstances under which they were made; provided that, with respect to projections, estimates and other forward-looking information, the Company represents only that such information was prepared in good faith based upon assumptions believed by it to be reasonable at the time. Except as disclosed in the Disclosure Documents, since December 31, 2015, there has been no change in

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the financial condition, operations, business or properties of Xxxxxx REIT, the Company or any Subsidiary except changes that could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. There is no fact known to the Company that could reasonably be expected to have a Material Adverse Effect that has not been set forth herein or in the Disclosure Documents.

Section 5.4. Organization and Ownership of Shares of Subsidiaries; Affiliates.

(a) Schedule 5.4 (as such Schedule may be updated pursuant to Section 4.1(a)) contains (except as noted therein) complete and correct lists, as of the date of this Agreement, of (1) the Company’s Subsidiaries, showing, as to each Subsidiary, the name thereof, the jurisdiction of its organization, and the nature and percentage of shares of each class of its capital stock or similar Equity Interests outstanding owned by the Company and each Subsidiary, (2) the Company’s Affiliates, other than Subsidiaries and identifying each Unconsolidated Affiliate, and (3) the directors and senior officers of Xxxxxx REIT and the Company.

(b) All of the outstanding shares of capital stock or similar Equity Interests of each Subsidiary shown in Schedule 5.4 as being owned by the Company and its Subsidiaries have been validly issued, are fully paid and non-assessable and are owned by the Company or another Subsidiary free and clear of any Lien that is prohibited by this Agreement.

(c) Each Subsidiary is a corporation or other legal entity duly organized, validly existing and, where applicable, in good standing under the laws of its jurisdiction of organization, and is duly qualified as a foreign corporation or other legal entity and, where applicable, is in good standing in each jurisdiction in which such qualification is required by law, other than those jurisdictions as to which the failure to be so qualified or in good standing could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. Each such Subsidiary has the corporate or other power and authority to own or hold under lease the properties it purports to own or hold under lease and to transact the business it transacts and proposes to transact.

(d) No Subsidiary is subject to any legal, regulatory, contractual or other restriction (other than this Agreement, the agreements listed on Schedule 5.4 and customary limitations imposed by corporate law or similar statutes and customary limitations imposed by the terms of agreements governing Nonrecourse Indebtedness) restricting the ability of such Subsidiary to pay dividends out of profits or make any other similar distributions of profits to the Company or any of its Subsidiaries that owns outstanding shares of capital stock or similar Equity Interests of such Subsidiary.

Section 5.5. Financial Statements; Material Liabilities. The Company has delivered to each Purchaser copies of the financial statements of Xxxxxx REIT and its Subsidiaries listed on Schedule 5.5. All of such financial statements (including in each case the related schedules and notes) fairly present in all material respects the consolidated financial position of Xxxxxx REIT and its Subsidiaries as of the respective dates specified in such Schedule and the consolidated results of their operations and cash flows for the respective periods so specified and have been prepared

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in accordance with GAAP consistently applied throughout the periods involved except as set forth in the notes thereto (subject, in the case of any interim financial statements, to normal year-end adjustments and the absence of footnotes). Xxxxxx REIT and its Subsidiaries do not have any Material liabilities that are not disclosed in the Disclosure Documents.

Section 5.6. Compliance with Laws, Other Instruments, Etc.

(a) The execution, delivery and performance by the Company of this Agreement and the Notes will not (1) contravene, result in any breach of, or constitute a default under, or result in the creation of any Lien in respect of any property of Xxxxxx REIT, the Company or any Subsidiary Guarantor under, any indenture, mortgage, deed of trust, loan, purchase or credit agreement, lease, corporate charter or by-laws, shareholders agreement or any other agreement or instrument to which Xxxxxx REIT, the Company or any Subsidiary Guarantor is bound or by which Xxxxxx REIT, the Company or any Subsidiary Guarantor or any of their respective properties may be bound or affected, (2) conflict with or result in a breach of any of the terms, conditions or provisions of any order, judgment, decree or ruling of any court, arbitrator or Governmental Authority applicable to Xxxxxx REIT, the Company or any Subsidiary Guarantor or (3) violate any provision of any statute or other rule or regulation of any Governmental Authority applicable to Xxxxxx REIT, the Company or any Subsidiary Guarantor.

(b) The execution, delivery and performance by Xxxxxx REIT of the Parent Guaranty will not (1) contravene, result in any breach of, or constitute a default under, or result in the creation of any Lien in respect of any property of Xxxxxx REIT, the Company or any Subsidiary Guarantor under, any indenture, mortgage, deed of trust, loan, purchase or credit agreement, lease, corporate charter or by-laws, shareholders agreement or any other agreement or instrument to which Xxxxxx REIT, the Company or any Subsidiary Guarantor is bound or by which Xxxxxx REIT, the Company or any Subsidiary Guarantor or any of their respective properties may be bound or affected, (2) conflict with or result in a breach of any of the terms, conditions or provisions of any order, judgment, decree or ruling of any court, arbitrator or Governmental Authority applicable to Xxxxxx REIT, the Company or any Subsidiary Guarantor or (3) violate any provision of any statute or other rule or regulation of any Governmental Authority applicable to Xxxxxx REIT, the Company or any Subsidiary Guarantor.

Section 5.7. Governmental Authorizations, Etc. No consent, approval or authorization of, or registration, filing or declaration with, any Governmental Authority is required in connection with the execution, delivery or performance by (a) the Company of this Agreement or the Notes or (b) Xxxxxx REIT of the Parent Guaranty, in each case, except for consents, approvals, authorizations, registrations, filings and declarations which have been duly obtained, taken, given or made and are in full force and effect.

Section 5.8. Litigation; Observance of Agreements, Statutes and Orders.

(a) There are no actions, suits, investigations or proceedings pending or, to the best knowledge of the Company, threatened in writing against or affecting Xxxxxx REIT,

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the Company or any Subsidiary or any property of Xxxxxx REIT, the Company or any Subsidiary in any court or before any arbitrator of any kind or before or by any Governmental Authority that could, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

(b) Neither Xxxxxx REIT, the Company nor any Subsidiary is (1) in default under any agreement or instrument to which it is a party or by which it is bound, (2) in violation of any order, judgment, decree or ruling of any court, arbitrator or Governmental Authority or (3) in violation of any applicable law, ordinance, rule or regulation of any Governmental Authority (including, without limitation, Environmental Laws, the USA PATRIOT Act or any of the other laws and regulations that are referred to in Section 5.16), which default or violation could, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

(c) To the best knowledge of the Company, there are no strikes, slow downs, work stoppages or walkouts or other labor disputes in progress or threatened relating to, Xxxxxx REIT, the Company or any Subsidiary except for those that, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect.

Section 5.9. Taxes.

(a) Xxxxxx REIT, the Company and each Subsidiary have filed all federal and state income tax returns and other material tax returns that are required to have been filed in any jurisdiction, and have paid all taxes shown to be due and payable on such returns and all other taxes and assessments levied upon them or their properties, assets, income or franchises, to the extent such taxes and assessments have become due and payable and before they have become delinquent, except for any taxes and assessments (1) the amount of which, individually or in the aggregate, is not Material or (2) the amount, applicability or validity of which is currently being contested in good faith by appropriate proceedings and with respect to which Xxxxxx REIT, the Company or a Subsidiary, as the case may be, has established adequate reserves in accordance with GAAP. The Company knows of no reasonable basis for any other tax or assessment that could, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. The charges, accruals and reserves on the books of Xxxxxx REIT, the Company and each Subsidiary in respect of U.S. federal, state or other taxes for all fiscal periods are adequate in accordance with GAAP. The U.S. federal income tax liabilities of Xxxxxx REIT, the Company and each Subsidiary have been finally determined (whether by reason of completed audits or the statute of limitations having run) for all fiscal years up to and including the fiscal year ended December 31, 2010.

(b) Xxxxxx REIT has operated, and intends to continue to operate in a manner so as to permit it to qualify as a REIT. Xxxxxx REIT has elected treatment as a REIT. Each Subsidiary of Xxxxxx REIT is either (1) a “qualified REIT subsidiary” within the meaning of Section 856(i) of the Code, (2) a REIT, (3) a Taxable REIT Subsidiary, (4) a partnership under Treasury Regulation Section 301.7701-3 or (5) an entity disregarded as a separate entity from its owner under Treasury Regulation Section 301.7701-3.

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Section 5.10. Title to Property; Leases.

(a) As of the date of this Agreement, Schedule 5.10(a) is a complete and correct list of all Properties, setting forth for each Property (1) the occupancy status of such Property as of March 31, 2016, (2) whether such Property is Construction-in-Progress or a Renovation Property and, if such Property is Construction-in-Progress or a Renovation Property, the status of completion of such Property, (3) whether such Property is an Eligible Property, (4) whether a Ground Lease is in effect for such Property and (5) whether such Property is an Unencumbered Pool Property.

(b) Xxxxxx REIT, the Company and each Material Subsidiary has good, marketable and legal title to, or a valid leasehold interest in, its respective assets.

(c) No Eligible Property is subject to any Lien other than Permitted Liens (or, to the extent they are Liens, Negative Pledges permitted by Section 10.4) and each Eligible Property satisfies all of the requirements for being an Eligible Property.

Section 5.11. Licenses, Permits, Etc.

(a) Xxxxxx REIT, the Company and each Subsidiary own or possess all licenses, permits, franchises, authorizations, patents, copyrights, proprietary software, service marks, trademarks and trade names, or rights thereto, that individually or in the aggregate are Material, without known conflict with the rights of others.

(b) To the best knowledge of the Company, no product or service of Xxxxxx REIT, the Company or any Subsidiary infringes in any material respect any license, permit, franchise, authorization, patent, copyright, proprietary software, service xxxx, trademark, trade name or other right owned by any other Person.

(c) To the best knowledge of the Company, there is no Material violation by any Person of any right of Xxxxxx REIT, the Company or any Subsidiary with respect to any patent, copyright, proprietary software, service xxxx, trademark, trade name or other right owned or used by Xxxxxx REIT, the Company or any Subsidiary.

Section 5.12. Compliance with ERISA.

(a) The Company and each ERISA Affiliate have operated and administered each Plan in compliance with all applicable laws except for such instances of noncompliance as have not resulted in and could not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect. Neither the Company nor any ERISA Affiliate has incurred any liability pursuant to Title I or IV of ERISA (other than for PBGC premiums due but not delinquent under Section 4007 of ERISA) or the penalty or excise tax provisions of the Code relating to employee benefit plans (as defined in section 3 of ERISA), and no event, transaction or condition has occurred or exists that could, individually or in the aggregate, reasonably be expected to result in the incurrence of any such liability by the Company or any ERISA Affiliate, or in the imposition of any Lien on any of the rights,

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properties or assets of the Company or any ERISA Affiliate, in either case pursuant to Title I or IV of ERISA or to section 430(k) of the Code or to any such penalty or excise tax provisions under the Code or federal law or section 4068 of ERISA or by the granting of a security interest in connection with the amendment of a Plan, other than such liabilities or Liens as would not be individually or in the aggregate Material.

(b) The present value of the aggregate benefit liabilities under each of the Pension Plans (other than Multiemployer Plans), determined as of the end of such Pension Plan’s most recently ended plan year on the basis of the actuarial assumptions specified for funding purposes in such Pension Plan’s most recent actuarial valuation report, did not exceed the aggregate current value of the assets of such Pension Plan allocable to such benefit liabilities by more than $15,000,000 in the aggregate for all Plans. The term “benefit liabilities” has the meaning specified in section 4001 of ERISA and the terms “current value” and “present value” have the meaning specified in section 3 of ERISA.

(c) The Company and its ERISA Affiliates have not incurred withdrawal liabilities under section 4201 or 4204 of ERISA in respect of Multiemployer Plans that individually or in the aggregate are Material.

(d) The expected postretirement benefit obligation (determined as of the last day of the Company’s most recently ended fiscal year in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 715-60, without regard to liabilities attributable to continuation coverage mandated by section 4980B of the Code) of Xxxxxx REIT, the Company and each Subsidiary is not Material.

(e) The execution and delivery of this Agreement and the issuance and sale of the Notes hereunder will not involve any transaction that is subject to the prohibitions of section 406 of ERISA or in connection with which a tax could be imposed pursuant to section 4975(c)(1)(A)-(D) of the Code. The representation by the Company to each Purchaser in the first sentence of this Section 5.12(e) is made in reliance upon and subject to the accuracy of such Purchaser’s representation in Section 6.2 as to the sources of the funds to be used to pay the purchase price of the Notes to be purchased by such Purchaser.

Section 5.13. Private Offering by the Company. Neither Xxxxxx REIT or the Company nor anyone acting on their behalf has offered the Notes, the Parent Guaranty or any similar Securities for sale to, or solicited any offer to buy the Notes, the Parent Guaranty or any similar Securities from, or otherwise approached or negotiated in respect thereof with, any Person other than the Purchasers and not more than 20 other Institutional Investors, each of which has been offered the Notes at a private sale for investment. Neither Xxxxxx REIT or the Company nor anyone acting on their behalf has taken, or will take, any action that would subject the issuance or sale of the Notes or the execution and delivery of the Parent Guaranty to the registration requirements of section 5 of the Securities Act or to the registration requirements of any Securities or blue sky laws of any applicable jurisdiction.

Section 5.14. Use of Proceeds; Margin Regulations. The Company will apply the proceeds of the sale of the Notes hereunder as set forth in the Memorandum. No part of the proceeds

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from the sale of the Notes hereunder will be used, directly or indirectly, for the purpose of buying or carrying any margin stock or to extend credit to others for the purposes of buying or carrying margin stock within the meaning of Regulation U of the Board of Governors of the Federal Reserve System (12 CFR 221), or for the purpose of buying or carrying or trading in any Securities under such circumstances as to involve the Company in a violation of Regulation X of said Board (12 CFR 224) or to involve any broker or dealer in a violation of Regulation T of said Board (12 CFR 220). Margin stock does not constitute more than 25% of the value of the consolidated assets of the Company and its Subsidiaries and the Company does not have any present intention that margin stock will constitute more than 25% of the value of such assets. As used in this Section, the terms “margin stock” and “purpose of buying or carrying” shall have the meanings assigned to them in said Regulation U.

Section 5.15. Existing Indebtedness; Future Liens.

(a) Except as described therein, Schedule 5.15 (as such Schedule may be updated pursuant to Section 4.1(a)) sets forth a complete and correct list of all outstanding Indebtedness of Xxxxxx REIT, the Company and each Subsidiary as of March 31, 2016 (including descriptions of the obligors and obligees (or the agent, trustee or other entity acting in a similar capacity), principal amounts outstanding, any collateral therefor and any Guaranties thereof (other than Guaranties of customary exceptions for fraud, misapplication of funds, environmental indemnities and other similar customary exceptions to recourse liability or exceptions relating to bankruptcy, insolvency, receivership or other similar events, provided that the obligations under such Guaranty have not become due and payable)), since which date there has been no Material change in the amounts, interest rates, sinking funds, installment payments or maturities of the Indebtedness of Xxxxxx REIT, the Company or any Subsidiary. Neither Xxxxxx REIT, the Company nor any Subsidiary is in default and no waiver of default is currently in effect, in the payment of any principal or interest on any Indebtedness of Xxxxxx REIT, the Company or such Subsidiary and no event or condition exists with respect to any Indebtedness of Xxxxxx REIT, the Company or any Subsidiary that would permit (or that with notice or the lapse of time, or both, would permit) one or more Persons to cause such Indebtedness to become due and payable before its stated maturity or before its regularly scheduled dates of payment.

(b) Except as disclosed in Schedule 5.15, neither Xxxxxx REIT, the Company nor any Subsidiary has agreed or consented to cause or permit, at any time after the date of this Agreement, any of its property, whether now owned or hereafter acquired, to be subject to a Lien that secures Indebtedness or to cause or permit in the future (upon the happening of a contingency or otherwise) any of its property, whether now owned or hereafter acquired, to be subject to a Lien not permitted by this Agreement.

(c) Neither Xxxxxx REIT, the Company nor any Subsidiary is a party to, or otherwise subject to any provision contained in, any instrument evidencing Indebtedness of Xxxxxx REIT, the Company or such Subsidiary, any agreement relating thereto or any other agreement (including, but not limited to, its charter or any other organizational document)

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which limits the amount of, or otherwise imposes restrictions on the incurring of, Indebtedness of Xxxxxx REIT or the Company, except as disclosed in Schedule 5.15.

Section 5.16. Foreign Assets Control Regulations, Etc.

(a) Neither the Company nor any Controlled Entity is (1) a Person whose name appears on the list of Specially Designated Nationals and Blocked Persons published by the Office of Foreign Assets Control, United States Department of the Treasury (“OFAC”) (an “OFAC Listed Person”), (2) an agent, department, or instrumentality of, or is otherwise beneficially owned by, controlled by or acting on behalf of, directly or indirectly, (i) any OFAC Listed Person or (ii) any Person, entity, organization, foreign country or regime that is subject to any OFAC Sanctions Program, or (3) otherwise blocked, subject to sanctions under or engaged in any activity in violation of other United States economic sanctions, including but not limited to, the Trading with the Enemy Act, the International Emergency Economic Powers Act, CISADA or any similar law or regulation with respect to Iran or any other country, the Sudan Accountability and Divestment Act, any OFAC Sanctions Program, or any economic sanctions regulations administered and enforced by the United States or any enabling legislation or executive order relating to any of the foregoing (collectively, “U.S. Economic Sanctions”) (each OFAC Listed Person and each other Person, entity, organization and government of a country described in clause (1), clause (2) or clause (3), a “Blocked Person”). Neither the Company nor any Controlled Entity has been notified that its name appears or may in the future appear on a state list of Persons that engage in investment or other commercial activities in Iran or any other country that is subject to U.S. Economic Sanctions.

(b) No part of the proceeds from the sale of the Notes hereunder constitutes or will constitute funds obtained on behalf of any Blocked Person or will otherwise be used by the Company or any Controlled Entity, directly or indirectly, (1) in connection with any investment in, or any transactions or dealings with, any Blocked Person, or (2) otherwise in violation of U.S. Economic Sanctions.

(c) Neither the Company nor any Controlled Entity (1) has been found in violation of, charged with, or convicted of, money laundering, drug trafficking, terrorist-related activities or other money laundering predicate crimes under the Currency and Foreign Transactions Reporting Act of 1970 (otherwise known as the Bank Secrecy Act), the USA PATRIOT Act or any other United States law or regulation governing such activities (collectively, “Anti-Money Laundering Laws”) or any U.S. Economic Sanctions violations, (2) to the Company’s actual knowledge after making due inquiry, is under investigation by any Governmental Authority for possible violation of Anti-Money Laundering Laws or any U.S. Economic Sanctions violations, (3) has been assessed civil penalties under any Anti-Money Laundering Laws or any U.S. Economic Sanctions, or (4) has had any of its funds seized or forfeited in an action under any Anti-Money Laundering Laws. Each of Xxxxxx REIT and the Company has established procedures and controls which it reasonably believes are adequate (and otherwise comply with applicable law) to ensure that the Company and each Controlled Entity is and will continue to be in compliance

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with all applicable current and future Anti-Money Laundering Laws and U.S. Economic Sanctions.

(d) (1) Neither the Company nor any Controlled Entity (i) has been charged with, or convicted of bribery or any other anti-corruption related activity under any applicable law or regulation in a U.S. or any non-U.S. country or jurisdiction, including but not limited to, the U.S. Foreign Corrupt Practices Act and the U.K. Xxxxxxx Xxx 0000 (collectively, “Anti-Corruption Laws”), (ii) to the Company’s actual knowledge after making due inquiry, is under investigation by any U.S. or non-U.S. Governmental Authority for possible violation of Anti-Corruption Laws, (iii) has been assessed civil or criminal penalties under any Anti-Corruption Laws or (iv) has been or is the target of sanctions imposed by the United Nations or the European Union;

(2) To the Company’s actual knowledge after making due inquiry, neither the Company nor any Controlled Entity has, within the last five years, directly or indirectly offered, promised, given, paid or authorized the offer, promise, giving or payment of anything of value to a Governmental Official or a commercial counterparty for the purposes of: (i) influencing any act, decision or failure to act by such Governmental Official in his or her official capacity or such commercial counterparty, (ii) inducing a Governmental Official to do or omit to do any act in violation of the Governmental Official’s lawful duty, or (iii) inducing a Governmental Official or a commercial counterparty to use his or her influence with a government or instrumentality to affect any act or decision of such government or entity; in each case in order to obtain, retain or direct business or to otherwise secure an improper advantage in violation of any applicable law or regulation or which would cause any Purchaser or holder to be in violation of any law or regulation applicable to such Purchaser or holder; and

(3) No part of the proceeds from the sale of the Notes hereunder will be used, directly or indirectly, for any improper payments, including bribes, to any Governmental Official or commercial counterparty in order to obtain, retain or direct business or obtain any improper advantage. Each of Xxxxxx REIT and the Company has established procedures and controls which it reasonably believes are adequate (and otherwise comply with applicable law) to ensure that the Company and each Controlled Entity is and will continue to be in compliance with all applicable current and future Anti-Corruption Laws.

Section 5.17. Status under Certain Statutes. Neither Xxxxxx REIT, the Company nor any Subsidiary is subject to regulation under the Investment Company Act of 1940, as amended, the Public Utility Holding Company Act of 2005, as amended, the ICC Termination Act of 1995, as amended, or the Federal Power Act, as amended.

Section 5.18. Environmental Matters.

(a) Neither Xxxxxx REIT, the Company nor any Subsidiary has knowledge of any claim or has received any notice of any claim and no proceeding has been instituted asserting

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any claim against Xxxxxx REIT, the Company or any Subsidiary or any of their respective real properties or other assets now or formerly owned, leased or operated by any of them, alleging any damage to the environment or violation of any Environmental Laws, except, in each case, such as could not reasonably be expected to result in a Material Adverse Effect.

(b) Neither Xxxxxx REIT, the Company nor any Subsidiary has knowledge of any facts which would give rise to any claim, public or private, of violation of Environmental Laws or damage to the environment emanating from, occurring on or in any way related to real properties now or formerly owned, leased or operated by any of them or to other assets or their use, except, in each case, such as could not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect.

(c) Neither Xxxxxx REIT, the Company nor any Subsidiary has stored any Hazardous Materials on real properties now or formerly owned, leased or operated by any of them in a manner which is contrary to any Environmental Law that could, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect.

(d) Neither Xxxxxx REIT, the Company nor any Subsidiary has disposed of any Hazardous Materials in a manner which is contrary to any Environmental Law that could, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect.

(e) All buildings on all real properties now owned, leased or operated by Xxxxxx REIT, the Company or any Subsidiary are in compliance with applicable Environmental Laws, except where failure to comply could not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect.

Section 5.19. Solvency. Xxxxxx REIT and the Company collectively are, and Xxxxxx REIT and its Subsidiaries on a consolidated basis are, Solvent.

Section 5.20. Unencumbered Pool Properties. Each Unencumbered Pool Property included in calculations of the Unencumbered Asset Value satisfies all of the requirements for being in the Unencumbered Pool.


SECTION 6.	REPRESENTATIONS OF THE PURCHASERS.

Section 6.1. Purchase for Investment. Each Purchaser severally represents that it is purchasing the Notes for its own account or for one or more separate accounts maintained by such Purchaser or for the account of one or more pension or trust funds and not with a view to the distribution thereof, provided that the disposition of such Purchaser’s or their property shall at all times be within such Purchaser’s or their control. Each Purchaser understands that the Notes have not been registered under the Securities Act and may be resold only if registered pursuant to the provisions of the Securities Act or if an exemption from registration is available, except under circumstances where neither such registration nor such an exemption is required by law, and that the Company is not required to register the Notes.

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Section 6.2. Source of Funds. Each Purchaser severally represents that at least one of the following statements is an accurate representation as to each source of funds (a “Source”) to be used by such Purchaser to pay the purchase price of the Notes to be purchased by such Purchaser hereunder:

(a) the Source is an “insurance company general account” (as the term is defined in the United States Department of Labor’s Prohibited Transaction Exemption (“PTE”) 95-60) in respect of which the reserves and liabilities (as defined by the annual statement for life insurance companies approved by the NAIC (the “NAIC Annual Statement”)) for the general account contract(s) held by or on behalf of any employee benefit plan together with the amount of the reserves and liabilities for the general account contract(s) held by or on behalf of any other employee benefit plans maintained by the same employer (or affiliate thereof as defined in PTE 95-60) or by the same employee organization in the general account do not exceed 10% of the total reserves and liabilities of the general account (exclusive of separate account liabilities) plus surplus as set forth in the NAIC Annual Statement filed with such Purchaser’s state of domicile; or

(b) the Source is a separate account that is maintained solely in connection with such Purchaser’s fixed contractual obligations under which the amounts payable, or credited, to any employee benefit plan (or its related trust) that has any interest in such separate account (or to any participant or beneficiary of such plan (including any annuitant)) are not affected in any manner by the investment performance of the separate account; or

(c) the Source is either (1) an insurance company pooled separate account, within the meaning of PTE 90-1 or (2) a bank collective investment fund, within the meaning of the PTE 91-38 and, except as disclosed by such Purchaser to the Company in writing pursuant to this clause (c), no employee benefit plan or group of plans maintained by the same employer or employee organization beneficially owns more than 10% of all assets allocated to such pooled separate account or collective investment fund; or

(d) the Source constitutes assets of an “investment fund” (within the meaning of Part VI of PTE 84-14 (the “QPAM Exemption”)) managed by a “qualified professional asset manager” or “QPAM” (within the meaning of Part VI of the QPAM Exemption), no employee benefit plan’s assets that are managed by the QPAM in such investment fund, when combined with the assets of all other employee benefit plans established or maintained by the same employer or by an affiliate (within the meaning of Part VI(c)(1) of the QPAM Exemption) of such employer or by the same employee organization and managed by such QPAM, represent more than 20% of the total client assets managed by such QPAM, the conditions of Part I(c) and (g) of the QPAM Exemption are satisfied, neither the QPAM nor a Person controlling or controlled by the QPAM maintains an ownership interest in the Company that would cause the QPAM and the Company to be “related” within the meaning of Part VI(h) of the QPAM Exemption and (1) the identity of such QPAM and (2) the names of any employee benefit plans whose assets in the investment fund, when combined with the assets of all other employee benefit plans established or maintained by the same employer or by an affiliate (within the meaning of Part VI(c)(1) of the QPAM Exemption) of such

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employer or by the same employee organization, represent 10% or more of the assets of such investment fund, have been disclosed to the Company in writing pursuant to this clause (d); or

(e) the Source constitutes assets of a “plan(s)” (within the meaning of Part IV(h) of PTE 96-23 (the “INHAM Exemption”)) managed by an “in-house asset manager” or “INHAM” (within the meaning of Part IV(a) of the INHAM Exemption), the conditions of Part I(a), (g) and (h) of the INHAM Exemption are satisfied, neither the INHAM nor a Person controlling or controlled by the INHAM (applying the definition of “control” in Part IV(d)(3) of the INHAM Exemption) owns a 10% or more interest in the Company and (1) the identity of such INHAM and (2) the name(s) of the employee benefit plan(s) whose assets constitute the Source have been disclosed to the Company in writing pursuant to this clause (e); or

(f) the Source is a governmental plan; or

(g) the Source is one or more employee benefit plans, or a separate account or trust fund comprised of one or more employee benefit plans, each of which has been identified to the Company in writing pursuant to this clause (g); or

(h) the Source does not include assets of any employee benefit plan, other than a plan exempt from the coverage of ERISA.

As used in this Section 6.2, the terms “employee benefit plan,” “governmental plan,” and “separate account” shall have the respective meanings assigned to such terms in section 3 of ERISA.

Section 6.3. Accredited Investor. Each Purchaser severally represents that it is an “accredited investor” (as defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) acting for its own account (and not for the account of others) or as a fiduciary or agent for others (which others are also “accredited investors”). Each Purchaser further severally represents that such Purchaser has had the opportunity to ask questions of the Company and received answers concerning the terms and conditions of the sale of the Notes.


SECTION 7.	INFORMATION AS TO XXXXXX REIT AND THE COMPANY.

Section 7.1. Financial and Business Information. The Company shall deliver to each holder of a Note that is an Institutional Investor:

(a) Quarterly Statements — within 60 days (or such shorter period as is the earlier of (x) 15 days greater than the period applicable to the filing of Xxxxxx REIT’s Quarterly Report on Form 10‑Q (the “Form 10‑Q”) with the SEC regardless of whether Xxxxxx REIT is subject to the filing requirements thereof and (y) the date by which such financial statements are required to be delivered under any Material Credit Facility or the date on which such corresponding financial statements are delivered under any Material Credit Facility if such delivery occurs earlier than such required delivery date) after the end

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of each quarterly fiscal period in each fiscal year of Xxxxxx REIT (other than the last quarterly fiscal period of each such fiscal year), duplicate copies of,

(1) a consolidated unaudited balance sheet of Xxxxxx REIT and its Subsidiaries as at the end of such quarter, and

(2) consolidated unaudited statements of income, changes in shareholders’ equity and cash flows of Xxxxxx REIT and its Subsidiaries for such quarter and (in the case of the second and third quarters) for the portion of the fiscal year ending with such quarter,

setting forth in each case in comparative form the figures for the corresponding periods in the previous fiscal year, all in reasonable detail, prepared in accordance with GAAP applicable to quarterly financial statements generally, and certified by a Senior Financial Officer of Xxxxxx REIT as fairly presenting, in all material respects, the financial position of the companies being reported on and their results of operations and cash flows, subject to changes resulting from year-end adjustments, provided that delivery within the time period specified above of copies of Xxxxxx REIT’s Form 10‑Q prepared in compliance with the requirements therefor and filed with the SEC shall be deemed to satisfy the requirements of this Section 7.1(a);

(b) Annual Statements — within 105 days (or such shorter period as is the earlier of (x) 15 days greater than the period applicable to the filing of Xxxxxx REIT’s Annual Report on Form 10‑K (the “Form 10‑K”) with the SEC regardless of whether Xxxxxx REIT is subject to the filing requirements thereof and (y) the date by which such financial statements are required to be delivered under any Material Credit Facility or the date on which such corresponding financial statements are delivered under any Material Credit Facility if such delivery occurs earlier than such required delivery date) after the end of each fiscal year of Xxxxxx REIT, duplicate copies of,

(1) a consolidated balance sheet of Xxxxxx REIT and its Subsidiaries as at the end of such year, and

(2) consolidated statements of income, changes in shareholders’ equity and cash flows of Xxxxxx REIT and its Subsidiaries for such year,

setting forth in each case in comparative form the figures for the previous fiscal year, all in reasonable detail, prepared in accordance with GAAP, and accompanied by an opinion thereon (without a “going concern” or similar qualification or exception and without any qualification or exception as to the scope of the audit on which such opinion is based) of independent public accountants of recognized national standing, which opinion shall state that such financial statements present fairly, in all material respects, the financial position of the companies being reported upon and their results of operations and cash flows and have been prepared in conformity with GAAP, and that the examination of such accountants in connection with such financial statements has been made in accordance with generally accepted auditing standards, and that such audit provides a reasonable basis for such opinion

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in the circumstances, provided that the delivery within the time period specified above of Xxxxxx REIT’s Form 10‑K for such fiscal year (together with Xxxxxx REIT’s annual report to shareholders, if any, prepared pursuant to Rule 14a‑3 under the Exchange Act) prepared in accordance with the requirements therefor and filed with the SEC, shall be deemed to satisfy the requirements of this Section 7.1(b);

(c) SEC and Other Reports — promptly upon their becoming available, one copy of (1) each financial statement, report, notice or proxy statement sent by Xxxxxx REIT, the Company or any Subsidiary to its principal lending banks as a whole (excluding information sent to such banks in the ordinary course of administration of a bank facility, such as information relating to pricing and borrowing availability) or to its public Securities holders generally, and (2) each regular or periodic report, each registration statement (without exhibits except as expressly requested by such Purchaser or holder), and each prospectus and all amendments thereto filed by Xxxxxx REIT, the Company or any Subsidiary with the SEC and of all press releases and other statements made available generally by Xxxxxx REIT, the Company or any Subsidiary to the public concerning developments that are Material, provided that the prompt delivery upon their becoming available of copies of any item described in this clause (2) and filed with the SEC shall be deemed to satisfy the requirements of this clause (2);

(d) Notice of Default or Event of Default — promptly, and in any event within five days after a Responsible Officer of the Company becoming aware of the existence of any Default or Event of Default or that any Person has given any notice or taken any action with respect to a claimed default hereunder or that any Person has given any notice or taken any action with respect to a claimed default of the type referred to in Section 11(f), a written notice specifying the nature and period of existence thereof and what action the Company is taking or proposes to take with respect thereto;

(e) ERISA Matters — promptly, and in any event within five days after a Responsible Officer of the Company becoming aware of any of the following, a written notice setting forth the nature thereof and the action, if any, that the Company or an ERISA Affiliate proposes to take with respect thereto:

(1) with respect to any Plan, any reportable event, as defined in section 4043(c) of ERISA and the regulations thereunder, for which notice thereof has not been waived pursuant to such regulations as in effect on the date of this Agreement; or

(2) the institution by the PBGC, or the threatening by the PBGC of the institution of, proceedings under section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Plan, or the receipt by the Company or any ERISA Affiliate of a notice from a Multiemployer Plan that such action has been taken by the PBGC with respect to such Multiemployer Plan; or

(3) any event, transaction or condition that results in the incurrence of any liability by the Company or any ERISA Affiliate pursuant to Title I or IV of

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ERISA (other than for PBGC premiums due but not delinquent under Section 4007 of ERISA) or the penalty or excise tax provisions of the Code relating to employee pension benefit plans, or in the imposition of any Lien on any of the rights, properties or assets of the Company or any ERISA Affiliate pursuant to Title I or IV of ERISA or such penalty or excise tax provisions, if such liability or Lien, taken together with any other such liabilities or Liens then existing, could reasonably be expected to have a Material Adverse Effect;

(f) Notices from Governmental Authority — promptly, and in any event within 30 days of receipt thereof, copies of any notice to Xxxxxx REIT, the Company or any Subsidiary from any federal or state Governmental Authority relating to any order, ruling, statute or other law or regulation that could reasonably be expected to have a Material Adverse Effect;

(g) Resignation or Replacement of Independent Auditors — within 10 days following the date on which Xxxxxx REIT’s independent auditors resign or Xxxxxx REIT elects to change independent auditors, as the case may be, notification thereof, together with such supporting information as the Required Holders may reasonably request;

(h) Change in Senior Management — prompt notice of any change in the senior management of Xxxxxx REIT or the Company;

(i) Calculation of Ownership Share — promptly upon the request of such holder of a Note (but no more frequently than once per fiscal year unless an Event of Default then exists), evidence of the Company’s calculation of Xxxxxx REIT’s Ownership Share with respect to an Unconsolidated Affiliate, such evidence to be reasonably satisfactory to such holder;

(j) Change in Rating — promptly upon any change in the rating assigned by S&P, Xxxxx’x, Fitch or any other nationally recognized statistical rating organization to Xxxxxx REIT’s senior, unsecured, long-term Indebtedness, a certificate stating that such credit rating has changed and the new credit rating that is in effect; and

(k) Requested Information — with reasonable promptness, such other data and information relating to the business, operations, affairs, financial condition, assets or properties of Xxxxxx REIT, the Company or any Subsidiary (including, but without limitation, actual copies of Xxxxxx REIT’s Form 10‑Q and Form 10‑K) or relating to the ability of the Company to perform its obligations hereunder and under the Notes or any Guarantor to perform its obligations under its Guaranty Agreement as from time to time may be reasonably requested by any such holder of a Note.

Section 7.2. Officer’s Certificate. Each set of financial statements delivered to a holder of a Note pursuant to Section 7.1(a) or Section 7.1(b) shall be accompanied by a certificate of a Senior Financial Officer of Xxxxxx REIT:

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(a) Covenant Compliance — setting forth (1) the information from such financial statements that is required in order to establish whether the Company was in compliance with the requirements of Section 10.5 and each Additional Covenant during the quarterly or annual period covered by the statements then being furnished, (including with respect to each such provision that involves mathematical calculations, the information from such financial statements that is required to perform such calculations) and detailed calculations of the maximum or minimum amount, ratio or percentage, as the case may be, permissible under the terms of such Section or Additional Covenant, and the calculation of the amount, ratio or percentage then in existence and (2) a list of the assets included in the calculation of Unencumbered Asset Value. In the event that Xxxxxx REIT, the Company or any Subsidiary has made an election to measure any financial liability using fair value (which election is being disregarded for purposes of determining compliance with this Agreement pursuant to Section 22.2) as to the period covered by any such financial statement, such Senior Financial Officer’s certificate as to such period shall include a reconciliation from GAAP with respect to such election;

(b) Funds From Operations — setting forth (1) a statement of Funds From Operations during the quarterly or annual period covered by the statements being furnished and (2) a report of newly acquired Properties during such period, including the Net Operating Income, cost and mortgage debt, if any, of each such Property;

(c) Event of Default — certifying that such Senior Financial Officer has reviewed the relevant terms hereof and has made, or caused to be made, under his or her supervision, a review of the transactions and conditions of Xxxxxx REIT, the Company and each Subsidiary from the beginning of the quarterly or annual period covered by the statements then being furnished to the date of the certificate and that such review shall not have disclosed the existence during such period of any condition or event that constitutes a Default or an Event of Default or, if any such condition or event existed or exists (including, without limitation, any such event or condition resulting from the failure of Xxxxxx REIT, the Company or any Subsidiary to comply with any Environmental Law), specifying the nature and period of existence thereof and what action Xxxxxx REIT, the Company or such Subsidiary shall have taken or proposes to take with respect thereto; and

(d) Material Credit Facility Subsidiary Guarantors – certifying as to the name of each Subsidiary, if any, that is a guarantor in respect of a Material Credit Facility as of the last day of the period covered by such certificate.

Section 7.3. Visitation. The Company will permit, and will cause Xxxxxx REIT to permit, the representatives of each holder of a Note that is an Institutional Investor:

(a) No Default — if no Default or Event of Default then exists, at the expense of such holder and upon reasonable prior notice to Xxxxxx REIT or the Company, as the case may be, but only once for each holder during any fiscal year (in addition to any visit with the independent public accountants described below) to visit the principal executive office of Xxxxxx REIT or the Company, to discuss the affairs, finances and accounts of Xxxxxx REIT, the Company and each Subsidiary with Xxxxxx REIT’s or the Company’s

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officers, and (with the consent of Xxxxxx REIT or the Company, as the case may be, which consent will not be unreasonably withheld) its independent public accountants (it being understood and agreed that only one such request for a discussion with the independent public accountants of Xxxxxx REIT and the Company may be made per fiscal year by all holders of Notes, such discussion shall be held on or around the end of the SAS 100 review period and that representatives of Xxxxxx REIT and the Company shall be entitled to be present at any such discussion), and (with the consent of Xxxxxx REIT or the Company, as the case may be, which consent will not be unreasonably withheld) to visit the other offices and properties of Xxxxxx REIT, the Company and each Subsidiary, all at such reasonable times and as often as may be reasonably requested in writing; and

(b) Default — if a Default or Event of Default then exists, at the expense of the Company to visit and inspect any of the offices or properties of Xxxxxx REIT, the Company or any Subsidiary, to examine all their respective books of account, records, reports and other papers, to make copies and extracts therefrom, and to discuss their respective affairs, finances and accounts with their respective officers and independent public accountants (and by this provision the Company authorizes and has caused Xxxxxx REIT to authorize said accountants to discuss the affairs, finances and accounts of Xxxxxx REIT, the Company and each Subsidiary, provided that representatives of Xxxxxx REIT and the Company shall be entitled to be present at any such discussion), all at such times and as often as may be requested.

Section 7.4. Electronic Delivery. Financial statements, opinions of independent certified public accountants, other information and Officer’s Certificates that are required to be delivered by the Company pursuant to Sections 7.1(a), (b) or (c) and Section 7.2 shall be deemed to have been delivered if the Company satisfies or causes to be satisfied any of the following requirements with respect thereto:

(a) such financial statements satisfying the requirements of Section 7.1(a) or (b) and related Officer’s Certificate satisfying the requirements of Section 7.2 are delivered to each holder of a Note by e-mail;

(b) Xxxxxx REIT shall have timely filed such Form 10–Q or Form 10–K, satisfying the requirements of Section 7.1(a) or Section 7.1(b), as the case may be, with the SEC on XXXXX and shall have made such form and the related Officer’s Certificate satisfying the requirements of Section 7.2 accessible from its home page on the internet, which is located at xxxx://xxxxxxxxxxxxxxxxxxxxxxx.xxx as of the date of this Agreement;

(c) such financial statements satisfying the requirements of Section 7.1(a) or Section 7.1(b) and related Officer’s Certificate satisfying the requirements of Section 7.2 are timely posted by or on behalf of Xxxxxx REIT on IntraLinks or on any other similar website to which each holder of Notes has free access; or

(d) Xxxxxx REIT shall have filed any of the items referred to in Section 7.1(c) with the SEC on XXXXX and shall have made such items accessible from its home page

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on the internet or on IntraLinks or on any other similar website to which each holder of Notes has free access;

provided however, that in the case of any of clauses (b), (c) or (d), the Company shall have given each holder of a Note prior written notice, which may be by e-mail or in accordance with Section 18, of such posting or filing in connection with each delivery, provided further, that upon request of any holder to receive paper copies of such forms, financial statements and Officer’s Certificates or to receive them by e-mail, the Company will promptly e-mail them or deliver such paper copies, as the case may be, to such holder.


SECTION 8.	PAYMENT AND PREPAYMENT OF THE NOTES.

Section 8.1. Maturity. As provided therein, the entire unpaid principal balance of each Note shall be due and payable on the Maturity Date thereof.

Section 8.2. Optional Prepayments with Make-Whole Amount. The Company may, at its option, upon notice as provided below, prepay at any time all, or from time to time any part of, the Notes, in an amount not less than 5% of the aggregate principal amount of the Notes then outstanding in the case of a partial prepayment, at 100% of the principal amount so prepaid, and the Make-Whole Amount, if any, determined for the prepayment date with respect to such principal amount. The Company will give each holder of Notes written notice of each optional prepayment under this Section 8.2 not less than 10 days and not more than 60 days prior to the date fixed for such prepayment unless the Company and the Required Holders agree to another time period pursuant to Section 17. Each such notice shall specify such date (which shall be a Business Day), the aggregate principal amount of the Notes to be prepaid on such date, the principal amount of each Note held by such holder to be prepaid (determined in accordance with Section 8.3), and the interest to be paid on the prepayment date with respect to such principal amount being prepaid, and shall be accompanied by a certificate of a Senior Financial Officer of the Company as to the estimated Make-Whole Amount, if any, due in connection with such prepayment (calculated as if the date of such notice were the date of the prepayment), setting forth the details of such computation. Any such notice of prepayment delivered in connection with a refinancing, the proceeds of which are to be used to make such prepayment, may be made, if expressly so stated in such notice to be, contingent upon the consummation of such refinancing and may be revoked by the Company in the event such refinancing is not consummated, provided that such notice of revocation is in writing and no notice of prepayment may be revoked after the third Business Day prior to the date specified in such notice of prepayment for the prepayment of the Notes. Two Business Days prior to such prepayment, the Company shall deliver to each holder of Notes a certificate of one of its Senior Financial Officers specifying the calculation of such Make-Whole Amount as of the specified prepayment date. Notwithstanding the foregoing, if the scheduled prepayment date for the prepayment of any Note pursuant to this Section 8.2 is 15 days or less from its Maturity Date, then no Make-Whole Amount shall be due and payable in connection with such prepayment.

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Section 8.3. Allocation of Partial Prepayments. In the case of each partial prepayment of the Notes pursuant to Section 8.2, the principal amount of the Notes to be prepaid shall be allocated among all of the Notes at the time outstanding in proportion, as nearly as practicable, to the respective unpaid principal amounts thereof not theretofore called for prepayment. In the case of any partial prepayment of the Notes pursuant to Section 8.7, the principal amount of the Notes to be prepaid shall be allocated only among the Notes of the holders that have elected to participate in such prepayment.

Section 8.4. Maturity; Surrender, Etc. In the case of each optional prepayment of Notes pursuant to this Section 8, the principal amount of each Note to be prepaid shall mature and become due and payable on the date fixed for such prepayment, together with interest on such principal amount accrued to such date and the applicable Make-Whole Amount, if any. From and after such date, unless the Company shall fail to pay such principal amount when so due and payable, together with the interest and Make-Whole Amount, if any, as aforesaid, interest on such principal amount shall cease to accrue. Any Note paid or prepaid in full shall be surrendered to the Company and cancelled and shall not be reissued, and no Note shall be issued in lieu of any prepaid principal amount of any Note.

Section 8.5. Purchase of Notes. The Company will not, and will not permit any Affiliate to, purchase, redeem, prepay or otherwise acquire, directly or indirectly, any of the outstanding Notes except (a) upon the payment or prepayment of the Notes in accordance with the terms of this Agreement and the Notes or (b) pursuant to an offer to purchase made by the Company or an Affiliate pro rata to the holders of all Notes at the time outstanding upon the same terms and conditions. Any such offer shall provide each holder with sufficient information to enable it to make an informed decision with respect to such offer, and shall remain open for at least 10 Business Days. If the holders of more than 50% of the principal amount of the Notes then outstanding accept such offer, the Company shall promptly notify the remaining holders of such fact and the expiration date for the acceptance by holders of Notes of such offer shall be extended by the number of days necessary to give each such remaining holder at least 10 Business Days from its receipt of such notice to accept such offer. The Company will promptly cancel all Notes acquired by it or any Affiliate pursuant to any payment or prepayment of Notes pursuant to this Agreement and no Notes may be issued in substitution or exchange for any such Notes.

Section 8.6. Make-Whole Amount.

“Make-Whole Amount” means, with respect to any Note, an amount equal to the excess, if any, of the Discounted Value of the Remaining Scheduled Payments with respect to the Called Principal of such Note over the amount of such Called Principal, provided that the Make-Whole Amount may in no event be less than zero. For the purposes of determining the Make-Whole Amount, the following terms have the following meanings:

“Called Principal” means, with respect to any Note, the principal of such Note that is to be prepaid pursuant to Section 8.2 or has become or is declared to be immediately due and payable pursuant to Section 12.1, as the context requires.

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“Discounted Value” means, with respect to the Called Principal of any Note, the amount obtained by discounting all Remaining Scheduled Payments with respect to such Called Principal from their respective scheduled due dates to the Settlement Date with respect to such Called Principal, in accordance with accepted financial practice and at a discount factor (applied on the same periodic basis as that on which interest on the Notes is payable) equal to the Reinvestment Yield with respect to such Called Principal.

“Reinvestment Yield” means, with respect to the Called Principal of any Note, 0.50% over the yield to maturity implied by the “Ask Yield(s)” reported as of 10:00 a.m. (New York City time) on the second Business Day preceding the Settlement Date with respect to such Called Principal, on the display designated as “Page PX1” (or such other display as may replace Page PX1) on Bloomberg Financial Markets for the most recently issued actively traded on-the-run U.S. Treasury securities (“Reported”) having a maturity equal to the Remaining Average Life of such Called Principal as of such Settlement Date. If there are no such U.S. Treasury securities Reported having a maturity equal to such Remaining Average Life, then such implied yield to maturity will be determined by (a) converting U.S. Treasury xxxx quotations to bond equivalent yields in accordance with accepted financial practice and (b) interpolating linearly between the “Ask Yields” Reported for the applicable most recently issued actively traded on-the-run U.S. Treasury securities with the maturities (1) closest to and greater than such Remaining Average Life and (2) closest to and less than such Remaining Average Life. The Reinvestment Yield shall be rounded to the number of decimal places as appears in the interest rate of the applicable Note.

If such yields are not Reported or the yields Reported as of such time are not ascertainable (including by way of interpolation), then “Reinvestment Yield” means, with respect to the Called Principal of any Note, 0.50% over the yield to maturity implied by the U.S. Treasury constant maturity yields reported, for the latest day for which such yields have been so reported as of the second Business Day preceding the Settlement Date with respect to such Called Principal, in Federal Reserve Statistical Release H.15 (or any comparable successor publication) for the U.S. Treasury constant maturity having a term equal to the Remaining Average Life of such Called Principal as of such Settlement Date. If there is no such U.S. Treasury constant maturity having a term equal to such Remaining Average Life, such implied yield to maturity will be determined by interpolating linearly between (1) the U.S. Treasury constant maturity so reported with the term closest to and greater than such Remaining Average Life and (2) the U.S. Treasury constant maturity so reported with the term closest to and less than such Remaining Average Life. The Reinvestment Yield shall be rounded to the number of decimal places as appears in the interest rate of the applicable Note.

“Remaining Average Life” means, with respect to any Called Principal, the number of years obtained by dividing (a) such Called Principal into (b) the sum of the products obtained by multiplying (1) the principal component of each Remaining Scheduled Payment with respect to such Called Principal by (2) the number of years, computed on the basis of a 360-day year composed of twelve 30-day months and calculated to two decimal places, that will elapse between the Settlement Date with respect to such Called Principal and the scheduled due date of such Remaining Scheduled Payment.

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“Remaining Scheduled Payments” means, with respect to the Called Principal of any Note, all payments of such Called Principal and interest thereon that would be due after the Settlement Date with respect to such Called Principal if no payment of such Called Principal were made prior to its scheduled due date, provided that if such Settlement Date is not a date on which interest payments are due to be made under the Notes, then the amount of the next succeeding scheduled interest payment will be reduced by the amount of interest accrued to such Settlement Date and required to be paid on such Settlement Date pursuant to Section 8.4 or Section 12.1.

“Settlement Date” means, with respect to the Called Principal of any Note, the date on which such Called Principal is to be prepaid pursuant to Section 8.2 or has become or is declared to be immediately due and payable pursuant to Section 12.1, as the context requires.

Section 8.7. Offer to Prepay Notes in the Event of a Change in Control.

(a) Notice of Change in Control. The Company will, not later than 10 Business Days after any Responsible Officer thereof has knowledge of the occurrence of any Change in Control, give written notice of such Change in Control (a “Change in Control Notice”) to each holder of Notes. Each Change in Control Notice shall contain and constitute an offer by the Company to prepay the Notes as described in Section 8.7(b) and shall be accompanied by the certificate described in Section 8.7(f).

(b) Offer to Prepay Notes. The offer to prepay Notes contemplated by Section 8.7(a) shall be an offer to prepay, in accordance with and subject to this Section 8.7, all, but not less than all, Notes held by each holder on a date specified in such offer (the “Change in Control Proposed Prepayment Date”), which date shall be a Business Day not less than 30 days and not more than 60 days after the date of such offer (or if the Change in Control Proposed Prepayment Date shall not be specified in such offer, the Change in Control Proposed Prepayment Date shall be the Business Day nearest to the 30th day after the date of such offer).

(c) Acceptance; Rejection. A holder of Notes may accept or reject the offer to prepay made pursuant to this Section 8.7 by causing a notice of such acceptance or rejection to be delivered to the Company no fewer than 10 days prior to the Change in Control Proposed Prepayment Date. A failure by a holder of Notes to so respond to an offer to prepay made pursuant to this Section 8.7 shall be deemed to constitute a rejection of such offer by such holder.

(d) Prepayment. Prepayment of the Notes to be prepaid pursuant to this Section 8.7 shall be at 100% of the principal amount of such Notes, together with accrued and unpaid interest on such Notes accrued to the date of prepayment but without any Make-Whole Amount or premium. The prepayment shall be made on the Change in Control Proposed Prepayment Date, except as provided by Section 8.7(e).

(e) Deferral Pending Change in Control. If the Change in Control Notice is delivered prior to the occurrence of the Change in Control, the obligation of the Company to prepay Notes pursuant to the offers required by Section 8.7(b) and accepted in accordance with Section 8.7(c) is subject to the occurrence of the Change in Control in respect of which such offers and acceptances shall have been made. In the event that such Change in Control does not occur on the Change in

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Control Proposed Prepayment Date in respect thereof, the prepayment shall be deferred until, and shall be made on the date on which, such Change in Control occurs. The Company shall keep each holder of Notes reasonably and timely informed of (1) any such deferral of the date of prepayment, (2) the date on which such Change in Control and the prepayment are expected to occur and (3) any determination by Xxxxxx REIT that efforts to effect such Change in Control have ceased or been abandoned (in which case the offers and acceptances made pursuant to this Section 8.7 in respect of such Change in Control automatically shall be deemed rescinded without penalty or other liability).

(f) Officer’s Certificate. Each offer to prepay the Notes pursuant to this Section 8.7 shall be accompanied by a certificate, executed by a Senior Financial Officer of the Company and dated the date of such offer, specifying (1) the Change in Control Proposed Prepayment Date, (2) that such offer is made pursuant to this Section 8.7 and that failure by a holder to respond to such offer by the deadline established in Section 8.7(c) shall result in such offer to such holder being deemed rejected, (3) the principal amount of each Note offered to be prepaid, (4) the interest that would be due on each Note offered to be prepaid, accrued to the Change in Control Proposed Prepayment Date, (5) that the conditions of this Section 8.7 required to be fulfilled prior to the giving of the Change in Control Notice have been fulfilled and (6) in reasonable detail, the general nature and date of the Change in Control.

(g) “Change in Control” means:

(1) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act) excluding the Specified Existing Investors, is or becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a Person will be deemed to have “beneficial ownership” of all securities that such Person has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of more than 40% of the total voting power of the then outstanding voting stock of Xxxxxx REIT;

(2) the Specified Existing Investors become the owner, directly or indirectly, of more than 50% of the total voting power of the then outstanding voting stock of Xxxxxx REIT (for the purposes of clarity, the Specified Existing Investors shall not be deemed to be the owner of any voting stock of Xxxxxx REIT merely as a result of having the right to acquire, either immediately or after the passage of time, shares of such voting stock); or

(3) the occurrence of any “change of control,” “change in management” or similar event under any Material Credit Facility.

Section 8.8. Payments Due on Non-Business Days. Anything in this Agreement or the Notes to the contrary notwithstanding, (a) subject to clause (b), any payment of interest on any Note that is due on a date that is not a Business Day shall be made on the next succeeding Business Day without including the additional days elapsed in the computation of the interest payable on such next succeeding Business Day; and (b) any payment of principal of or Make-Whole Amount on

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any Note (including principal due on the Maturity Date of such Note) that is due on a date that is not a Business Day shall be made on the next succeeding Business Day and shall include the additional days elapsed in the computation of interest payable on such next succeeding Business Day.


SECTION 9.	AFFIRMATIVE COVENANTS.

So long as any of the Notes are outstanding, the Company covenants that:

Section 9.1. Compliance with Laws. Without limiting Section 10.3, the Company will, and will cause Xxxxxx REIT and each Subsidiary to, comply with all laws, ordinances or governmental rules or regulations to which each of them is subject, including, without limitation, ERISA, Environmental Laws, the USA PATRIOT Act and the other laws and regulations that are referred to in Section 5.16, and will obtain and maintain in effect all licenses, certificates, permits, franchises and other governmental authorizations necessary to the ownership of their respective properties or to the conduct of their respective businesses, in each case to the extent necessary to ensure that non-compliance with such laws, ordinances or governmental rules or regulations or failures to obtain or maintain in effect such licenses, certificates, permits, franchises and other governmental authorizations could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

Section 9.2. Insurance. The Company will, and will cause Xxxxxx REIT and each Subsidiary to, maintain, with financially sound and reputable insurers, insurance with respect to their respective properties and businesses (on a replacement cost basis as it relates to property insurance for all perils other than earthquake related perils, which shall be insured on a net probable maximum loss basis) against such casualties and contingencies, of such types, on such terms and in such amounts (including deductibles, co-insurance and self-insurance, if adequate reserves are maintained with respect thereto) as is customary in the case of entities of established reputations engaged in the same or a similar business and similarly situated or as may be required by applicable law.

Section 9.3. Maintenance of Properties. The Company will, and will cause Xxxxxx REIT and each Subsidiary to, maintain and keep, or cause to be maintained and kept, their respective properties in good repair, working order and condition (other than ordinary wear and tear), so that the business carried on in connection therewith may be properly conducted at all times, except where the failure to do so could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

Section 9.4. Payment of Taxes and Claims. The Company will, and will cause Xxxxxx REIT and each Subsidiary to, file all federal and state income tax returns and other material tax returns required to be filed in any jurisdiction and to pay and discharge all taxes shown to be due and payable on such returns and all other taxes, assessments, governmental charges, or levies imposed on them or any of their properties, assets, income or franchises, to the extent the same have become due and payable and before they have become delinquent and all claims for which sums have become due and payable that have or might become a Lien on properties or assets of Xxxxxx REIT, the Company or any Subsidiary, provided that none of Xxxxxx REIT, the Company or any

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Subsidiary need pay any such tax, assessment, charge, levy or claim if (a) the amount, applicability or validity thereof is contested by Xxxxxx REIT, the Company or such Subsidiary on a timely basis in good faith and in appropriate proceedings which operate to suspend the collection thereof, and Xxxxxx REIT, the Company or such Subsidiary has established adequate reserves therefor in accordance with GAAP on the books of Xxxxxx REIT, the Company or such Subsidiary or (b) the nonpayment of all such taxes, assessments, charges, levies and claims could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

Section 9.5. Corporate Existence, Etc. Except as otherwise permitted pursuant to Section 10.2, the Company will, and will cause Xxxxxx REIT to, at all times preserve and keep its limited partnership or corporate existence, as the case may be, in full force and effect. Except as otherwise permitted pursuant to Section 10.2, the Company will, and will cause Xxxxxx REIT to, at all times preserve and keep in full force and effect the corporate or other organizational existence of each Subsidiary and all rights and franchises of Xxxxxx REIT, the Company and each Subsidiary unless, in the good faith judgment of Xxxxxx REIT or the Company, the termination of or failure to preserve and keep in full force and effect such corporate existence, right or franchise could not, individually or in the aggregate, have a Material Adverse Effect.

Section 9.6. Books and Records. The Company will, and will cause Xxxxxx REIT and each Subsidiary to, maintain proper books of record and account in conformity with GAAP and in conformity in all material respects with all applicable requirements of any Governmental Authority having legal or regulatory jurisdiction over Xxxxxx REIT, the Company or such Subsidiary, as the case may be. The Company will, and will cause Xxxxxx REIT and each Subsidiary to, keep books, records and accounts which, in reasonable detail, accurately reflect in all material respects all transactions and dispositions of assets. Xxxxxx REIT, the Company and each Subsidiary have devised a system of internal accounting controls sufficient to provide reasonable assurances that their respective books, records, and accounts accurately reflect all transactions and dispositions of assets and the Company will, and will cause Xxxxxx REIT and each Subsidiary to, continue to maintain such system.

Section 9.7. REIT Status. The Company shall cause Xxxxxx REIT to maintain its status as a REIT under the Code.

Section 9.8. Exchange Privileges. The Company shall cause Xxxxxx REIT to maintain at least one class of common shares of Xxxxxx REIT having trading privileges on the New York Stock Exchange or NYSE Amex Equities or which is subject to price quotations on The NASDAQ Stock Market’s National Market System.

Section 9.9. Subsidiary Guarantors.

(a) The Company will cause each of its Subsidiaries that Guarantees or otherwise becomes liable at any time, whether as a borrower or an additional or co-borrower or otherwise, for or in respect of any Indebtedness under any Material Credit Facility to concurrently therewith:

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(1) enter into a guaranty agreement substantially in the form of Exhibit SG hereto (a “Subsidiary Guaranty”); and

(2) deliver the following to each holder of a Note:

(i) an executed counterpart of such Subsidiary Guaranty;

(ii) to the extent required by or otherwise delivered pursuant to any Material Credit Facility, a certificate signed by an authorized responsible officer of such Subsidiary containing representations and warranties on behalf of such Subsidiary to the same effect, mutatis mutandis, as those contained in Sections 5.1, 5.2, 5.6, 5.7 and 5.19 (but with respect to such Subsidiary and such Subsidiary Guaranty, rather than the Company);

(iii) to the extent required by or otherwise delivered pursuant to any Material Credit Facility, documents evidencing the due organization, continuing existence and good standing of such Subsidiary and the due authorization by all requisite action on the part of such Subsidiary of the execution and delivery of such Subsidiary Guaranty and the performance by such Subsidiary of its obligations thereunder; and

(iv) to the extent required by or otherwise delivered pursuant to any Material Credit Facility, an opinion of counsel covering the authorization, execution, delivery and/or enforceability of the Subsidiary Guaranty.

(b) The holders of Notes will discharge and release any Subsidiary Guarantor from its Subsidiary Guaranty upon the written request of the Company; provided that (1) such Subsidiary Guarantor shall have been released and discharged (or will be released and discharged concurrently with the release of such Subsidiary Guarantor under its Subsidiary Guaranty) as a guarantor or additional or co-borrower under and in respect of Indebtedness under each Material Credit Facility and the Company so certifies to the holders of Notes in a certificate of one of its Responsible Officers, (2) at the time of such release and discharge, the Company shall have delivered a certificate of one of its Responsible Officers to the holders of Notes stating that no Default or Event of Default has occurred and is continuing or will result from such release and discharge, (3) such Subsidiary Guarantor shall have no obligations then due and payable under its Subsidiary Guaranty and (4) if any fee or other form of consideration is given to any party to a Material Credit Facility for the purpose of its release of such Subsidiary Guarantor thereunder, the holders of Notes shall receive equivalent consideration.

Section 9.10. Most Favored Lender Provision. If at any time any Material Credit Facility or any Guaranty in respect thereof shall include any Financial Covenant and such provision is not contained in this Agreement (any such provision, together with any related definitions (including, without limitation, any term defined therein with reference to the application of GAAP, as identified in any Material Credit Facility), an “Additional Covenant”), then the Company shall promptly,

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and in any event within 10 Business Days thereof, provide a Most Favored Lender Notice with respect to each such Additional Covenant; provided that a Most Favored Lender Notice is not required to be given in the case of the Additional Covenants incorporated herein on the date of this Agreement. Thereupon, unless waived in writing by the Required Holders within 10 days of the Purchasers and holders receipt of such notice, such Additional Covenant shall be deemed incorporated by reference into this Agreement, mutatis mutandis, as if set forth fully herein, effective (a) in the case of any Additional Covenant effective on the date of this Agreement, as of the date of this Agreement, and (b) in the case of any Additional Covenant effective after the date of this Agreement, as of the earliest date when such Additional Covenant became effective under any Material Credit Facility. Any Additional Covenant incorporated into this Agreement pursuant to this provision, (1) shall remain unchanged herein notwithstanding any temporary waiver of such Additional Covenant under any Material Credit Facility, (2) shall be deemed automatically amended herein to reflect any subsequent amendments agreed and implemented in relation to such Additional Covenant under any Material Credit Facility and (3) shall be deemed deleted from this Agreement at such time as such Additional Covenant is deleted or otherwise removed from or is no longer in effect under or pursuant to any Material Credit Facility or if such Material Credit Facility has been terminated; provided in each case that any consideration paid or provided to any holder of Indebtedness under a Material Credit Facility in connection with an event contemplated by clause (2) or (3) above (other than repayment in full of such Material Credit Facility in connection with its termination) is paid to each holder of Notes at the same time and on equivalent terms; and provided further that no Additional Covenant shall be so deemed automatically amended or deleted during any time that a Default or Event of Default has occurred and is continuing. In determining whether a breach of any Financial Covenant incorporated by reference into this Agreement pursuant to this Section 9.10 shall constitute an Event of Default, the period of grace, if any, applicable to such Additional Covenant in the applicable Material Credit Facility shall apply.

Section 9.11. Line of Business. The Company will, and will cause Xxxxxx REIT and each Subsidiary to, only carry on in its respective businesses in which it is engaged as of the date of this Agreement (including acquiring, owning, redeveloping, developing, financing and managing various types of Properties, including, without limitation, Retail Properties, Office Properties, Studio Properties, and Mixed-Use Properties) and such other business activities incidental thereto, and the Company will not, and will not permit Xxxxxx REIT or any Subsidiary to, enter into any line of business not otherwise engaged in by such Person as of the date of this Agreement.

Section 10. Negative Covenants.

So long as any of the Notes are outstanding, the Company covenants that:

Section 10.1. Transactions with Affiliates. The Company will not, and will not permit Xxxxxx REIT or any Subsidiary to, permit to exist or enter into, any transaction (including the purchase, sale, lease or exchange of any property or the rendering of any service) with any Affiliate, except transactions in the ordinary course of and pursuant to the reasonable requirements of the business of Xxxxxx REIT, the Company or such Subsidiary and upon fair and reasonable terms

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which are no less favorable to Xxxxxx REIT, the Company or such Subsidiary than would be obtained in a comparable arm’s length transaction with a Person that is not an Affiliate.

Section 10.2. Merger, Consolidation, Etc. The Company will not, and will not permit Xxxxxx REIT or any Subsidiary to, (a) enter into any transaction of merger or consolidation, (b) liquidate, wind-up or dissolve itself (or suffer any liquidation or dissolution), (c) convey, sell, lease, sublease, transfer or otherwise dispose of, in one transaction or a series of transactions, all or any substantial part of its business or assets, or the capital stock of or other Equity Interests in any of its Subsidiaries, whether now owned or hereafter acquired or (d) acquire a Substantial Amount of the assets of, or make an Investment of a Substantial Amount in, any other Person; provided, however, that:

(1) any Subsidiary (which, for the avoidance of doubt does not include the Company) may merge with Xxxxxx REIT, the Company or any Subsidiary Guarantor so long as Xxxxxx REIT, the Company or such Subsidiary Guarantor is the survivor and any Subsidiary (other than the Company) that is not a Subsidiary Guarantor may merge with any other Subsidiary that is not a Subsidiary Guarantor;

(2) any Subsidiary (which, for the avoidance of doubt does not include the Company) may sell, transfer or dispose of its assets to Xxxxxx REIT, the Company or any Subsidiary Guarantor, and any Subsidiary (other than the Company) that is not a Subsidiary Guarantor may sell, transfer or dispose of its assets to any other Subsidiary that is not a Subsidiary Guarantor;

(3) any Subsidiary Guarantor (other a Subsidiary Guarantor that owns an Unencumbered Pool Property) and any other Subsidiary that is not (and is not required to be) a Subsidiary Guarantor may convey, sell, transfer or otherwise dispose of, in one transaction or a series of transactions, all or any substantial part of its business or assets, or the capital stock of or other Equity Interests in any of its Subsidiaries, and immediately thereafter liquidate, provided that immediately prior to any such conveyance, sale, transfer, disposition or liquidation and immediately thereafter and after giving effect thereto, no Default or Event of Default does or would exist;

(4) Xxxxxx REIT, the Company or any Subsidiary may, directly or indirectly, (i) acquire (whether by purchase, acquisition of Equity Interests of a Person, or as a result of a merger or consolidation) a Substantial Amount of the assets of, or make an Investment of a Substantial Amount in, any other Person and (ii) sell, lease or otherwise transfer, whether by one or a series of transactions, a Substantial Amount of assets (including capital stock or other securities of any Subsidiaries) to any other Person, so long as, in each case, (A) the Company shall have given the Purchasers and the holders of the Notes at least 30 days’ prior written notice of such consolidation, merger, acquisition, Investment, sale, lease or other transfer, (B) immediately prior thereto, and immediately thereafter and after giving effect thereto, no Default or Event of Default is or would be in existence, including, without limitation, a Default or Event of Default resulting from a breach of Section 10.5 or any Additional Covenant, (C) in the case of a consolidation or merger involving Xxxxxx REIT

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or the Company or a Subsidiary Guarantor that owns an Unencumbered Pool Property included in the calculation of Unencumbered Asset Value, Xxxxxx REIT or the Company or such Subsidiary Guarantor, respectively, shall be the survivor thereof and (D) at the time the Company gives notice pursuant to clause (A) of this subsection, the Company shall have delivered to each holder of a Note an Officer’s Certificate of Xxxxxx REIT containing the information required by Section 7.2(a), calculated on a pro forma basis, evidencing the continued compliance by Xxxxxx REIT, the Company and each Subsidiary with the terms and conditions of this Agreement, including without limitation, the financial covenants contained in Section 10.5 and any Additional Covenant, after giving effect to such consolidation, merger, acquisition, Investment, sale, lease or other transfer; and

(5) Xxxxxx REIT, the Company or any Subsidiary may lease and sublease their respective assets, as lessor or sublessor (as the case may be), in the ordinary course of their business.

Section 10.3. Terrorism Sanctions Regulations. The Company will not, and will not permit any Controlled Entity to, (a) become (including by virtue of being owned or controlled by a Blocked Person), own or control a Blocked Person or any Person that is the target of sanctions imposed by the United Nations or by the European Union, or (b) directly or indirectly, have any investment in or engage in any dealing or transaction (including, without limitation, any investment, dealing or transaction involving the proceeds of the Notes) with any Person if such investment, dealing or transaction (1) would cause any Purchaser or holder to be in violation of or subject to sanctions under any U.S. Economic Sanctions or any similar laws, regulations or orders adopted by any State within the United States, or (2) is prohibited by or subject to sanctions under any U.S. Economic Sanctions, or (c) engage, nor shall any Affiliate of either engage, in any activity that would subject such Person or any holder to sanctions under CISADA or any similar law or regulation with respect to Iran or any other country that is subject to U.S. Economic Sanctions.

Section 10.4. Liens. The Company will not, and will not permit Xxxxxx REIT or any Subsidiary to, create, incur, assume or permit or suffer to exist any Lien on any Unencumbered Pool Property now owned or hereafter acquired or on any direct or indirect ownership interest of the Company in any Person owning any Unencumbered Pool Property, except for (a) Permitted Liens and (b) a Negative Pledge contained in any agreement that evidences Unsecured Indebtedness, which Negative Pledge contains restrictions on encumbering assets that are substantially similar to those restrictions contained in this Agreement. In addition, the Company will not, and will not permit Xxxxxx REIT or any Subsidiary to, secure any Indebtedness outstanding under or pursuant to any Material Credit Facility unless and until the Notes (and any Guaranty delivered in connection therewith) shall concurrently be secured equally and ratably with such Indebtedness pursuant to documentation reasonably acceptable to the Required Holders in substance and in form, including, without limitation, an intercreditor agreement and opinions of counsel to Xxxxxx REIT, the Company and/or any such Subsidiary, as the case may be, from counsel that is reasonably acceptable to the Required Holders.

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Section 10.5. Financial Covenants.

(a) Ratio of Total Liabilities to Total Asset Value. The Company will not, at any time, permit the ratio of (1) Total Liabilities to (2) Total Asset Value, to exceed 0.600 to 1.000 provided that, to the extent permitted by the Material Credit Facilities, such ratio may increase to 0.650 to 1.000 for up to two consecutive calendar quarters immediately following a Material Acquisition of which the Company has given the Purchasers and holders of Notes written notice. For purposes of this covenant, (i) Total Liabilities shall be adjusted by deducting therefrom the lesser of (A) the amount of unrestricted cash and Cash Equivalents in excess of $30,000,000 to the extent that there is an equivalent amount of Indebtedness included in Total Liabilities that matures within 24 months from the applicable date of the calculation and (B) the lowest maximum amount, if any, of cash and Cash Equivalents then permitted to be subtracted from total liabilities for purposes of calculating the total liabilities to total asset value covenant under any Material Credit Facility, and (ii) Total Asset Value shall be adjusted by deducting therefrom the amount by which Total Liabilities is adjusted pursuant to clause (i) above.

(b) Ratio of Unsecured Indebtedness to Unencumbered Asset Value. The Company will not, at any time, permit the ratio of (1) Unsecured Indebtedness of Xxxxxx REIT and its Subsidiaries, on a consolidated basis (which shall include Xxxxxx REIT’s Ownership Share of Unsecured Indebtedness of Unconsolidated Affiliates in accordance with Section 22.2), to (2) Unencumbered Asset Value, to exceed the lesser of (x) 0.667 to 1.000 and (y) the lowest maximum ratio of unsecured indebtedness to unencumbered asset value then permitted under any Material Credit Facility. For purposes of this covenant, (i) Unsecured Indebtedness shall be adjusted by deducting therefrom the lesser of (A) the amount of unrestricted cash and Cash Equivalents in excess of $30,000,000 to the extent that there is an equivalent amount of Unsecured Indebtedness that matures within 24 months from the applicable date of the calculation and (B) the lowest maximum amount, if any, of cash and Cash Equivalents then permitted to be subtracted from unsecured indebtedness for purposes of calculating the unsecured indebtedness to unencumbered asset value covenant under any Material Credit Facility, and (ii) Unencumbered Asset Value shall be adjusted by deducting therefrom the amount by which Unsecured Indebtedness is adjusted pursuant to clause (i) above.

(c) Ratio of Adjusted EBITDA to Fixed Charges. The Company will not permit the ratio of (1) Adjusted EBITDA of Xxxxxx REIT and its Subsidiaries, on a consolidated basis (which shall include Xxxxxx REIT’s Ownership Share of Adjusted EBITDA of Unconsolidated Affiliates in accordance with Section 22.2), for any prior consecutive 12-month period to (2) Fixed Charges of Xxxxxx REIT and its Subsidiaries, on a consolidated basis (which shall include Xxxxxx REIT’s Ownership Share of Fixed Charges of Unconsolidated Affiliates in accordance with Section 22.2), for such prior consecutive 12-month period, to be less than 1.500 to 1.000 as of the last day of any fiscal quarter.

(d) Ratio of Secured Indebtedness to Total Asset Value. The Company will not, at any time, permit the ratio of (1) Secured Indebtedness of Xxxxxx REIT and its Subsidiaries,

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on a consolidated basis (which shall include Xxxxxx REIT’s Ownership Share of Secured Indebtedness of Unconsolidated Affiliates in accordance with Section 22.2), to (2) Total Asset Value, to exceed 0.450 to 1.000. For purposes of this Section 10.5(d), Secured Indebtedness shall include all unsecured debt for borrowed money (including Guaranties in respect thereof) of Subsidiaries other than the Company or any Subsidiary Guarantor that is then a party to a Subsidiary Guaranty.

(e) Ratio of Unencumbered NOI to Unsecured Interest Expense. The Company will not, as of the last day of any fiscal quarter, permit the ratio of (1) Unencumbered NOI for such fiscal quarter to (2) Unsecured Interest Expense for such fiscal quarter to be less than the greater of (i) 1.600 to 1.000 and (ii) the highest minimum ratio of unsecured net operating income to unsecured interest expense then required under any Material Credit Facility.

(f) Dividends and Other Restricted Payments. If a Default or Event of Default exists, the Company may only make Restricted Payments to Xxxxxx REIT and other holders of Equity Interests of the Company during any fiscal year, in each case, in an aggregate amount not to exceed the minimum amount required to be distributed to all of the holders of Equity Interests of the Company such that the amount distributed to Xxxxxx REIT is sufficient to enable Xxxxxx REIT to (1) make scheduled cash distributions to shareholders of Xxxxxx REIT to the extent such distributions were publicly announced prior to the occurrence of any Default or Event of Default, (2) make scheduled dividends in respect of the Company Preferred Units and (3) make cash distributions to its shareholders to remain in compliance with Section 9.7. If a Default or Event of Default specified in Section 11(a), (b), (g) or (h) shall exist, or if as a result of the occurrence of any other Event of Default any of the Notes have been accelerated pursuant to Section 12, the Company will not, and will not permit any Subsidiary to, make any Restricted Payments to any Person other than to the Company or any Wholly-Owned Subsidiary.

Section 10.6. Restrictions on Intercompany Transfers. The Company will not, and will not permit any Subsidiary Guarantor to, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of the Company or any Subsidiary Guarantor to: (a) pay dividends or make any other distribution on any of such Person’s capital stock or other Equity Interests owned by the Company or any such Subsidiary Guarantor (other than any restrictions contained in the Company LP Agreement); (b) pay any Indebtedness owed to the Company or any Subsidiary; (c) make loans or advances to the Company or any Subsidiary; or (d) transfer any of its property or assets to the Company or any Subsidiary, other than, in each case, (1) those encumbrances or restrictions contained in this Agreement, (2) restrictions and conditions imposed by applicable law, (3) customary restrictions and conditions contained in agreements relating to the sale of such Subsidiary Guarantor or any Property owned by the Company or such Subsidiary Guarantor (to the extent such sale is permitted hereunder), (4) customary restrictions and conditions contained in agreements relating to the acquisition of any Property (to the extent such acquisition is not prohibited under this Agreement), (5) customary restrictions governing any purchase money Liens permitted hereby covering only the property subject to such Lien, (6) those restrictions contained in any other agreement that

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evidences Unsecured Indebtedness, which restrictions on the actions described above that are substantially similar to those contained in this Agreement, and (7) with respect to clause (d) only, customary provisions restricting assignment of any agreement entered into by the Company or any Subsidiary in the ordinary course of business.

Section 10.7. Modifications of Organizational Documents. The Company will not, and will not permit Xxxxxx REIT or any Subsidiary to, amend, supplement, restate or otherwise modify or waive the application of any provision of its certificate or articles of incorporation or formation, by-laws, operating agreement, declaration of trust, partnership agreement or other applicable organizational document if such amendment, supplement, restatement or other modification (a) is adverse to the interest of the Purchasers or the holders of Notes in any material respect (provided, that amendments to include or modify customary special purpose entity provisions in connection with the incurrence of Secured Indebtedness shall not be deemed adverse under this Section 10.7) or (b) could reasonably be expected to have a Material Adverse Effect.

Section 10.8. Derivatives Contracts. The Company will not, and will not permit Xxxxxx REIT or any Subsidiary to, enter into or become obligated in respect of Derivatives Contracts other than Derivatives Contracts entered into by the Company, Xxxxxx REIT or any such Subsidiary in the ordinary course of business and which establish an effective hedge in respect of liabilities, commitments or assets held or reasonably anticipated to be held by the Company, Xxxxxx REIT or such Subsidiary.

Section 10.9. Xxxxxx REIT Ownership and Management of the Company. The Company will not permit Xxxxxx REIT to (a) own less than a 51% legal and beneficial ownership interest in the Company or (b) cease to be the sole general partner of the Company.


SECTION 11.	EVENTS OF DEFAULT.

An “Event of Default” shall exist if any of the following conditions or events shall occur and be continuing:

(a) the Company defaults in the payment of any principal or Make-Whole Amount, if any, on any Note when the same becomes due and payable, whether at maturity or at a date fixed for prepayment or by declaration or otherwise; or

(b) the Company defaults in the payment of any interest on any Note for more than five Business Days after the same becomes due and payable; or

(c) the Company defaults in the performance of or compliance with any term contained in Section 7.1(a), (b) or (d), Section 7.2, Section 10 or any Additional Covenant; or

(d) the Company or any Guarantor defaults in the performance of or compliance with any term contained herein (other than those referred to in Sections 11(a), (b) and (c)) or in any Guaranty Agreement and such default is not remedied within 30 days after the earlier of (1) a Responsible Officer obtaining actual knowledge of such default and (2) the

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Company receiving written notice of such default from any holder of a Note (any such written notice to be identified as a “notice of default” and to refer specifically to this Section 11(d)); or

(e) (1) any representation or warranty made in writing by or on behalf of the Company or by any officer of the Company in this Agreement or any writing furnished in connection with the transactions contemplated hereby proves to have been false or incorrect in any material respect on the date as of which made, or (2) any representation or warranty made in writing by or on behalf of any Guarantor or by any officer of such Guarantor in any Guaranty Agreement or any writing furnished in connection with such Guaranty Agreement proves to have been false or incorrect in any material respect on the date as of which made; or

(f) (1) the Company, Xxxxxx REIT or any Subsidiary is in default (as principal or as guarantor or other surety) in the payment of any principal of or premium or make-whole amount or interest on any Indebtedness that is outstanding in an aggregate principal amount of at least (i) $30,000,000 with respect to Recourse Indebtedness or (ii) $50,000,000 with respect to Nonrecourse Indebtedness beyond any period of grace provided with respect thereto, or (2) the Company, Xxxxxx REIT or any Subsidiary is in default in the performance of or compliance with any term of any evidence of any Indebtedness in an aggregate outstanding principal amount of at least (i) $30,000,000 with respect to Recourse Indebtedness or (ii) $50,000,000 with respect to Nonrecourse Indebtedness or of any mortgage, indenture or other agreement relating thereto or any other condition exists, and as a consequence of such default or condition such Indebtedness has become, or has been declared, due and payable before its stated maturity or before its regularly scheduled dates of payment, (3) as a consequence of the occurrence or continuation of any event or condition (other than the passage of time or the right of the holder of Indebtedness to convert such Indebtedness into equity interests), the Company, Xxxxxx REIT or any Subsidiary has become obligated to purchase or repay Indebtedness before its regular maturity or before its regularly scheduled dates of payment in an aggregate outstanding principal amount of at least (i) $30,000,000 with respect to Recourse Indebtedness or (ii) $50,000,000 with respect to Nonrecourse Indebtedness, or (4) there occurs an “Event of Default” under and as defined in any Derivatives Contract with a notional value in excess of $50,000,000 as to which the Company, Xxxxxx REIT or any Subsidiary is a “Defaulting Party” (as defined therein); provided that, if at any time any Material Credit Facility shall provide for “cross-default” as opposed to “cross-acceleration” in the events of default thereunder that are the same or substantially similar to those described in clauses (2) or (3) above, clauses (2) and (3) above shall be deemed to have been revised such that (A) the occurrence of any event described in such clause and (B) any Person then having the right to either declare such Indebtedness due or to require the purchase or prepayment of such Indebtedness, shall constitute an Event of Default under this Section 11(f); or

(g) the Company, Xxxxxx REIT, any Subsidiary Guarantor or any other Subsidiary that accounts for more than 5% of the Total Asset Value as of any date of determination (1) is generally not paying, or admits in writing its inability to pay, its debts

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as they become due, (2) files, or consents by answer or otherwise to the filing against it of, a petition for relief or reorganization or arrangement or any other petition in bankruptcy, for liquidation or to take advantage of any bankruptcy, insolvency, reorganization, moratorium or other similar law of any jurisdiction, (3) makes an assignment for the benefit of its creditors, (4) consents to the appointment of a custodian, receiver, trustee or other officer with similar powers with respect to it or with respect to any substantial part of its property, (5) is adjudicated as insolvent or to be liquidated, or (6) takes corporate action for the purpose of any of the foregoing; or

(h) a court or other Governmental Authority of competent jurisdiction enters an order appointing, without consent by the Company, Xxxxxx REIT, any Subsidiary Guarantor or any other Subsidiary that accounts for more than 5% of the Total Asset Value as of any date of determination, a custodian, receiver, trustee or other officer with similar powers with respect to it or with respect to any substantial part of its property, or constituting an order for relief or approving a petition for relief or reorganization or any other petition in bankruptcy or for liquidation or to take advantage of any bankruptcy or insolvency law of any jurisdiction, or ordering the dissolution, winding-up or liquidation of the Company, Xxxxxx REIT, such Subsidiary Guarantor or such other Subsidiary, or any such petition shall be filed against the Company, Xxxxxx REIT, such Subsidiary Guarantor or such other Subsidiary and such petition shall not be dismissed within 60 days; or

(i) one or more final judgments or orders for the payment of money (including, without limitation, any final order enforcing a binding arbitration decision) or for an injunction or other non-monetary relief are rendered against one or more of the Company, Xxxxxx REIT or any Subsidiary and which judgments or orders are not, within 30 days after entry thereof, bonded, discharged or stayed pending appeal, or are not discharged within 30 days after the expiration of such stay and either (1) the aggregate amount of such judgment or order and any other judgments or orders against Xxxxxx REIT, the Company and the Subsidiaries is in excess of $50,000,000 (excluding amounts covered by insurance for which insurance coverage for such judgment has been confirmed by the applicable carrier) or (2) in the case of any injunction or other non-monetary relief, such injunction or other non-monetary relief could reasonably be expected to have a Material Adverse Effect; or

(j) if (1) any Pension Plan shall fail to satisfy the minimum funding standards of ERISA or the Code for any plan year or part thereof or a waiver of such standards or extension of any amortization period is sought or granted under section 412 of the Code, (2) a notice of intent to terminate any Pension Plan shall have been or is reasonably expected to be filed with the PBGC or the PBGC shall have instituted proceedings under ERISA section 4042 to terminate or appoint a trustee to administer any Pension Plan or the PBGC shall have notified the Company or any ERISA Affiliate that a Pension Plan may become a subject of any such proceedings, (3) the aggregate “amount of unfunded benefit liabilities” (within the meaning of section 4001(a)(18) of ERISA) under all Pension Plans, determined in accordance with Title IV of ERISA, shall exceed $50,000,000, (4) the Company or any ERISA Affiliate shall have incurred or is reasonably expected to incur any liability pursuant to Title I or IV of ERISA or the penalty or excise tax provisions of the

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Code relating to employee pension benefit plans, (5) the Company or any ERISA Affiliate withdraws from any Multiemployer Plan, or (6) the Company, Xxxxxx REIT or any Subsidiary establishes or amends any employee welfare benefit plan that provides post-employment welfare benefits in a manner that would increase the liability of the Company, Xxxxxx REIT or any Subsidiary thereunder; and any such event or events described in clauses (1) through (6) above, either individually or together with any other such event or events, could reasonably be expected to have a Material Adverse Effect. As used in this Section 11(j), the terms “employee pension benefit plan” and “employee welfare benefit plan” shall have the respective meanings assigned to such terms in section 3 of ERISA; or

(k) any Guaranty Agreement shall cease to be in full force and effect, any Guarantor or any Person acting on behalf of any Guarantor shall contest in any manner the validity, binding nature or enforceability of its Guaranty Agreement, or the obligations of any Guarantor under its Guaranty Agreement are not or cease to be legal, valid, binding and enforceable against such Guarantor in accordance with the terms of such Guaranty Agreement.


SECTION 12.	REMEDIES ON DEFAULT, ETC.

Section 12.1. Acceleration.

(a) If an Event of Default with respect to the Company described in Section 11(g) or (h) (other than an Event of Default described in clause (1) of Section 11(g) or described in clause (6) of Section 11(g) by virtue of the fact that such clause encompasses clause (1) of Section 11(g)) has occurred, all the Notes then outstanding shall automatically become immediately due and payable.

(b) If any other Event of Default has occurred and is continuing, the Required Holders may at any time at their option, by notice or notices to the Company, declare all the Notes then outstanding to be immediately due and payable.

(c) If any Event of Default described in Section 11(a) or (b) has occurred and is continuing, any holder or holders of Notes at the time outstanding affected by such Event of Default may at any time, at its or their option, by notice or notices to the Company, declare all the Notes held by it or them to be immediately due and payable.

Upon any Notes becoming due and payable under this Section 12.1, whether automatically or by declaration, such Notes will forthwith mature and the entire unpaid principal amount of such Notes, plus (x) all accrued and unpaid interest thereon (including, but not limited to, interest accrued thereon at the applicable Default Rate) and (y) the Make-Whole Amount, if any, determined in respect of such principal amount (to the full extent permitted by applicable law), shall all be immediately due and payable, in each and every case without presentment, demand, protest or further notice, all of which are hereby waived. The Company acknowledges, and the parties hereto agree, that each holder of a Note has the right to maintain its investment in the Notes free from repayment by the Company (except as herein specifically provided for) and that the provision for payment of a Make-Whole Amount by the Company in the event that the Notes are prepaid or are

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accelerated as a result of an Event of Default, is intended to provide compensation for the deprivation of such right under such circumstances.

Section 12.2. Other Remedies. If any Default or Event of Default has occurred and is continuing, and irrespective of whether any Notes have become or have been declared immediately due and payable under Section 12.1, the holder of any Note at the time outstanding may proceed to protect and enforce the rights of such holder by an action at law, suit in equity or other appropriate proceeding, whether for the specific performance of any agreement contained herein or in any Note or any Guaranty Agreement, or for an injunction against a violation of any of the terms hereof or thereof, or in aid of the exercise of any power granted hereby or thereby or by law or otherwise.

Section 12.3. Rescission. At any time after any Notes have been declared due and payable pursuant to Section 12.1(b) or (c), the Required Holders, by written notice to the Company, may rescind and annul any such declaration and its consequences if (a) the Company has paid all overdue interest on the Notes, all principal of and Make-Whole Amount, if any, on any Notes that are due and payable and are unpaid other than by reason of such declaration, and all interest on such overdue principal and Make-Whole Amount, if any, and (to the extent permitted by applicable law) any overdue interest in respect of the Notes, at the applicable Default Rate, (b) neither the Company nor any other Person shall have paid any amounts which have become due solely by reason of such declaration, (c) all Events of Default and Defaults, other than non-payment of amounts that have become due solely by reason of such declaration, have been cured or have been waived pursuant to Section 17, and (d) no judgment or decree has been entered for the payment of any monies due pursuant hereto or to the Notes. No rescission and annulment under this Section 12.3 will extend to or affect any subsequent Event of Default or Default or impair any right consequent thereon.

Section 12.4. No Waivers or Election of Remedies, Expenses, Etc. No course of dealing and no delay on the part of any holder of any Note in exercising any right, power or remedy shall operate as a waiver thereof or otherwise prejudice such holder’s rights, powers or remedies. No right, power or remedy conferred by this Agreement, any Guaranty Agreement or any Note upon any holder thereof shall be exclusive of any other right, power or remedy referred to herein or therein or now or hereafter available at law, in equity, by statute or otherwise. Without limiting the obligations of the Company under Section 15, the Company will pay to the holder of each Note on demand such further amount as shall be sufficient to cover all reasonable and documented costs and expenses of such holder incurred in any enforcement or collection under this Section 12, including, without limitation, reasonable and documented attorneys’ fees, expenses and disbursements.


SECTION 13.	REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.

Section 13.1. Registration of Notes. The Company shall keep at its principal executive office a register for the registration and registration of transfers of Notes. The name and address of each holder of one or more Notes, each transfer thereof and the name and address of each transferee of one or more Notes shall be registered in such register. If any holder of one or more Notes is a nominee, then (a) the name and address of the beneficial owner of such Note or Notes shall also be registered in such register as an owner and holder thereof and (b) at any such beneficial owner’s option, either such beneficial owner or its nominee may execute any amendment, waiver or consent

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pursuant to this Agreement. Prior to due presentment for registration of transfer, the Person(s) in whose name any Note(s) shall be registered shall be deemed and treated as the owner and holder thereof for all purposes hereof, and the Company shall not be affected by any notice or knowledge to the contrary. The Company shall give to any holder of a Note that is an Institutional Investor promptly upon request therefor, a complete and correct copy of the names and addresses of all registered holders of Notes.

Section 13.2. Transfer and Exchange of Notes. Upon surrender of any Note to the Company at the address and to the attention of the designated officer (all as specified in Section 18(3)), for registration of transfer or exchange (and in the case of a surrender for registration of transfer accompanied by a written instrument of transfer duly executed by the registered holder of such Note or such holder’s attorney duly authorized in writing and accompanied by the relevant name, address and other information for notices of each transferee of such Note or part thereof), within 10 Business Days thereafter, the Company shall execute and deliver, at the Company’s expense (except as provided below), one or more new Notes of the same series (as requested by the holder thereof) in exchange therefor, in an aggregate principal amount equal to the unpaid principal amount of the surrendered Note. Each such new Note shall be payable to such Person as such holder may request and shall be substantially in the form of Schedule 1(a) or 1(b), as applicable. Each such new Note shall be dated and bear interest from the date to which interest shall have been paid on the surrendered Note or dated the date of the surrendered Note if no interest shall have been paid thereon. The Company may require payment of a sum sufficient to cover any stamp tax or governmental charge imposed in respect of any such transfer of Notes. Notes shall not be transferred in denominations of less than $100,000, provided that if necessary to enable the registration of transfer by a holder of its entire holding of Notes of a series, one Note of such series may be in a denomination of less than $100,000. Any transferee, by its acceptance of a Note registered in its name (or the name of its nominee), shall be deemed to have made the representation set forth in Section 6.2.

Section 13.3. Replacement of Notes. Upon receipt by the Company at the address and to the attention of the designated officer (all as specified in Section 18(3)) of evidence reasonably satisfactory to it of the ownership of and the loss, theft, destruction or mutilation of any Note (which evidence shall be, in the case of an Institutional Investor, notice from such Institutional Investor of such ownership and such loss, theft, destruction or mutilation), and

(a) in the case of loss, theft or destruction, of indemnity reasonably satisfactory to it (provided that if the holder of such Note is, or is a nominee for, an original Purchaser or another holder of a Note with a minimum net worth of at least $100,000,000 or a Qualified Institutional Buyer, such Person’s own unsecured agreement of indemnity shall be deemed to be satisfactory), or

(b) in the case of mutilation, upon surrender and cancellation thereof,

within 10 Business Days thereafter, the Company at its own expense shall execute and deliver, in lieu thereof, a new Note of the same series, dated and bearing interest from the date to which interest shall have been paid on such lost, stolen, destroyed or mutilated Note or dated the date of such lost, stolen, destroyed or mutilated Note if no interest shall have been paid thereon.

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SECTION 14.	PAYMENTS ON NOTES.

Section 14.1. Place of Payment. Subject to Section 14.2, payments of principal, Make-Whole Amount, if any, and interest becoming due and payable on the Notes shall be made in New York, New York at the principal office of Xxxxx Fargo Bank, National Association in such jurisdiction. The Company may at any time, by notice to each holder of a Note, change the place of payment of the Notes so long as such place of payment shall be either the principal office of the Company in such jurisdiction or the principal office of a bank or trust company in such jurisdiction.

Section 14.2. Home Office Payment. So long as any Purchaser or its nominee shall be the holder of any Note, and notwithstanding anything contained in Section 14.1 or in such Note to the contrary, the Company will pay all sums becoming due on such Note for principal, Make-Whole Amount, if any, interest and all other amounts becoming due hereunder by the method and at the address specified for such purpose below such Purchaser’s name in Schedule B, or by such other method or at such other address as such Purchaser shall have from time to time specified to the Company in writing for such purpose, without the presentation or surrender of such Note or the making of any notation thereon, except that upon written request of the Company made concurrently with or reasonably promptly after payment or prepayment in full of any Note, such Purchaser shall surrender such Note for cancellation, reasonably promptly after any such request, to the Company at its principal executive office or at the place of payment most recently designated by the Company pursuant to Section 14.1. Prior to any sale or other disposition of any Note held by a Purchaser or its nominee, such Purchaser will, at its election, either endorse thereon the amount of principal paid thereon and the last date to which interest has been paid thereon or surrender such Note to the Company in exchange for a new Note or Notes pursuant to Section 13.2. The Company will afford the benefits of this Section 14.2 to any Institutional Investor that is the direct or indirect transferee of any Note purchased by a Purchaser under this Agreement and that has made the same agreement relating to such Note as the Purchasers have made in this Section 14.2.


SECTION 15.	EXPENSES, ETC.

Section 15.1. Transaction Expenses. Whether or not the transactions contemplated hereby are consummated, the Company will pay all reasonable and documented costs and expenses (including reasonable and documented attorneys’ fees of one special counsel for the Purchasers and holders of the Notes, as a whole, and, if reasonably required by the Required Holders, one local counsel in each applicable jurisdiction and/or one specialty counsel in any applicable specialty) incurred by the Purchasers and each other holder of a Note in connection with such transactions and in connection with any amendments, waivers or consents under or in respect of this Agreement, any Guaranty Agreement or the Notes (whether or not such amendment, waiver or consent becomes effective), including, without limitation: (a) the costs and expenses incurred in enforcing or defending (or determining whether or how to enforce or defend) any rights under this Agreement, any Guaranty Agreement or the Notes or in responding to any subpoena or other legal process or informal investigative demand issued in connection with this Agreement, any Guaranty Agreement or the Notes, or by reason of being a holder of any Note, (b) the costs and expenses, including fees of one financial advisor for all of Purchasers and the holders of the Notes, as a whole, incurred in connection with the insolvency or bankruptcy of Xxxxxx REIT, the Company or any Subsidiary or

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in connection with any work-out or restructuring of the transactions contemplated hereby and by the Notes and any Guaranty Agreement and (c) the costs and expenses incurred in connection with the initial filing of this Agreement and all related documents and financial information with the SVO provided, that such costs and expenses under this clause (c) shall not exceed $4,500; provided that if there is a conflict of interest between any Purchaser or holder of a Note and one or more other Purchasers and holders of Notes, the Company will pay the reasonable and documented out-of-pocket costs and expenses of a separate counsel and/or a separate financial advisor for each group of similarly situated conflicted Purchasers or holders of Notes. The Company will pay, and will save each Purchaser and each other holder of a Note harmless from, (1) all claims in respect of any fees, costs or expenses, if any, of brokers and finders (other than those, if any, retained by a Purchaser or other holder in connection with its purchase of the Notes) and (2) any and all wire transfer fees that any bank deducts from any payment under such Note to such holder or otherwise charges to a holder of a Note with respect to a payment under such Note.

Section 15.2. Survival. The obligations of the Company under this Section 15 will survive the payment or transfer of any Note, the enforcement, amendment or waiver of any provision of this Agreement, any Guaranty Agreement or the Notes, and the termination of this Agreement.


SECTION 16.	SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.

All representations and warranties contained herein shall survive the execution and delivery of this Agreement and the Notes, the purchase or transfer by any Purchaser of any Note or portion thereof or interest therein and the payment of any Note, and may be relied upon by any subsequent holder of a Note, regardless of any investigation made at any time by or on behalf of such Purchaser or any other holder of a Note. All statements contained in any certificate or other instrument delivered by or on behalf of the Company pursuant to this Agreement shall be deemed representations and warranties of the Company under this Agreement. Subject to the preceding sentence, this Agreement, the Notes and the Guaranty Agreement(s) embody the entire agreement and understanding between each Purchaser and the Company and supersede all prior agreements and understandings relating to the subject matter hereof.


SECTION 17.	AMENDMENT AND WAIVER.

Section 17.1. Requirements. This Agreement and the Notes may be amended, and the observance of any term hereof or of the Notes may be waived (either retroactively or prospectively), only with the written consent of the Company and the Required Holders, except that:

(a) no amendment or waiver of any of Sections 1, 2, 3, 4, 5, 6 or 21 hereof, or any defined term (as it is used therein), will be effective as to any Purchaser unless consented to by such Purchaser in writing; and

(b) no amendment or waiver may, without the written consent of each Purchaser and the holder of each Note at the time outstanding, (1) subject to Section 12 relating to acceleration or rescission, change the amount or time of any prepayment or payment of principal of, or reduce the rate or change the time of payment or method of computation of

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(i) interest on the Notes or (ii) the Make-Whole Amount, (2) change the percentage of the principal amount of the Notes the holders of which are required to consent to any amendment or waiver or (3) amend any of Sections 8 (except as set forth in the second sentence of Section 8.2), 11(a), 11(b), 12, 17 or 20.

Section 17.2. Solicitation of Holders of Notes.

(a) Solicitation. The Company will provide each holder of a Note with sufficient information, sufficiently far in advance of the date a decision is required, to enable such holder to make an informed and considered decision with respect to any proposed amendment, waiver or consent in respect of any of the provisions hereof or of the Notes or any Guaranty Agreement. The Company will deliver executed or true and correct copies of each amendment, waiver or consent effected pursuant to this Section 17 or any Guaranty Agreement to each holder of a Note promptly following the date on which it is executed and delivered by, or receives the consent or approval of, the requisite holders of Notes.

(b) Payment. The Company will not directly or indirectly pay or cause to be paid any remuneration, whether by way of supplemental or additional interest, fee or otherwise, or grant any security or provide other credit support, to any holder of a Note as consideration for or as an inducement to the entering into by such holder of any waiver or amendment of any of the terms and provisions hereof or of any Guaranty Agreement or of any Note unless such remuneration is concurrently paid, or security is concurrently granted or other credit support concurrently provided, on the same terms, ratably to each holder of a Note even if such Purchaser or holder did not consent to such waiver or amendment.

(c) Consent in Contemplation of Transfer. Any consent given pursuant to this Section 17 or any Guaranty Agreement by a holder of a Note that has transferred or has agreed to transfer its Note to Xxxxxx REIT, the Company or any Affiliate in connection with such consent shall be void and of no force or effect except solely as to such holder, and any amendments effected or waivers granted or to be effected or granted that would not have been or would not be so effected or granted but for such consent (and the consents of all other holders of Notes that were acquired under the same or similar conditions) shall be void and of no force or effect except solely as to such holder.

Section 17.3. Binding Effect, Etc. Any amendment or waiver consented to as provided in this Section 17 or any Guaranty Agreement applies equally to all holders of Notes and is binding upon them and upon each future holder of any Note and upon the Company without regard to whether such Note has been marked to indicate such amendment or waiver. No such amendment or waiver will extend to or affect any obligation, covenant, agreement, Default or Event of Default not expressly amended or waived or impair any right consequent thereon. No course of dealing between the Company and any holder of a Note and no delay in exercising any rights hereunder or under any Note or any Guaranty Agreement shall operate as a waiver of any rights of any holder of such Note.

Section 17.4. Notes Held by Company, Etc. Solely for the purpose of determining whether the holders of the requisite percentage of the aggregate principal amount of Notes then outstanding

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approved or consented to any amendment, waiver or consent to be given under this Agreement, any Guaranty Agreement or the Notes, or have directed the taking of any action provided herein or in any Guaranty Agreement or the Notes to be taken upon the direction of the holders of a specified percentage of the aggregate principal amount of Notes then outstanding, Notes directly or indirectly owned by Xxxxxx REIT, the Company or any Affiliate shall be deemed not to be outstanding.


SECTION 18.	NOTICES.

Except to the extent otherwise provided in Section 7.4, all notices and communications provided for hereunder shall be in writing and sent (a) by telecopy if the sender on the same day sends a confirming copy of such notice by an internationally recognized overnight delivery service (charges prepaid), (b) by registered or certified mail with return receipt requested (postage prepaid), or (c) by an internationally recognized overnight delivery service (with charges prepaid). Any such notice must be sent:

(1) if to any Purchaser or its nominee, to such Purchaser or nominee at the address specified for such communications in Schedule B, or at such other address as such Purchaser or nominee shall have specified to the Company in writing,

(2) if to any other holder of any Note, to such holder at such address as such other holder shall have specified to the Company in writing, or

(3) if to the Company, to the Company at its address set forth at the beginning hereof to the attention of Xxxx Lammas, Chief Financial Officer, or at such other address as the Company shall have specified to the holder of each Note in writing.

Notices under this Section 18 will be deemed given only when actually received.


SECTION 19.	REPRODUCTION OF DOCUMENTS.

This Agreement and all documents relating hereto, including, without limitation, (a) consents, waivers and modifications that may hereafter be executed, (b) documents received by any Purchaser at a Closing (except the Notes themselves), and (c) financial statements, certificates and other information previously or hereafter furnished to any Purchaser or holder of a Note, may be reproduced by such Purchaser or holder by any photographic, photostatic, electronic, digital, or other similar process and such Purchaser or holder may destroy any original document so reproduced. The Company agrees and stipulates that, to the extent permitted by applicable law, any such reproduction shall be admissible in evidence as the original itself in any judicial or administrative proceeding (whether or not the original is in existence and whether or not such reproduction was made by such Purchaser or holder in the regular course of business) and any enlargement, facsimile or further reproduction of such reproduction shall likewise be admissible in evidence. This Section 19 shall not prohibit the Company or any other Purchaser or other holder of a Note from contesting any such reproduction to the same extent that it could contest the original, or from introducing evidence to demonstrate the inaccuracy of any such reproduction.


SECTION 20.	CONFIDENTIAL INFORMATION.

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For the purposes of this Section 20, “Confidential Information” means information delivered to any Purchaser by or on behalf of Xxxxxx REIT, the Company or any Subsidiary in connection with the transactions contemplated by or otherwise pursuant to this Agreement that is proprietary in nature and that was clearly marked or labeled or otherwise adequately identified when received by such Purchaser as being confidential information of Xxxxxx REIT, the Company or such Subsidiary, provided that such term does not include information that (a) was publicly known or otherwise known to such Purchaser prior to the time of such disclosure, (b) subsequently becomes publicly known through no act or omission by such Purchaser or any Person acting on such Purchaser’s behalf, (c) otherwise becomes known to such Purchaser other than through disclosure by Xxxxxx REIT, the Company or any Subsidiary or (d) constitutes financial statements delivered to such Purchaser under Section 7.1 that are otherwise publicly available. Each Purchaser will maintain the confidentiality of such Confidential Information in accordance with procedures adopted by such Purchaser in good faith to protect confidential information of third parties delivered to such Purchaser, provided that such Purchaser may deliver or disclose Confidential Information to (1) its directors, officers, employees, agents, attorneys, trustees and affiliates (to the extent such disclosure reasonably relates to the administration of the investment represented by its Notes), (2) its auditors, financial advisors and other professional advisors who agree to hold confidential the Confidential Information substantially in accordance with this Section 20, (3) any other holder of any Note, (4) any Institutional Investor to which it sells or offers to sell such Note or any part thereof or any participation therein (if such Person has agreed in writing prior to its receipt of such Confidential Information to be bound by this Section 20), (5) any Person from which it offers to purchase any Security of Xxxxxx REIT or the Company (if such Person has agreed in writing prior to its receipt of such Confidential Information to be bound by this Section 20), (6) any federal or state regulatory authority having jurisdiction over such Purchaser, (7) the NAIC or the SVO or, in each case, any similar organization, or any nationally recognized rating agency that requires access to information about such Purchaser’s investment portfolio, or (8) any other Person to which such delivery or disclosure may be necessary or appropriate (i) to effect compliance with any law, rule, regulation or order applicable to such Purchaser, (ii) in response to any subpoena or other legal process, (iii) in connection with any litigation to which such Purchaser is a party or (iv) if an Event of Default has occurred and is continuing, to the extent such Purchaser may reasonably determine such delivery and disclosure to be necessary or appropriate in the enforcement or for the protection of the rights and remedies under such Purchaser’s Notes, this Agreement or any Guaranty Agreement. Each holder of a Note, by its acceptance of a Note, will be deemed to have agreed to be bound by and to be entitled to the benefits of this Section 20 as though it were a party to this Agreement. On reasonable request by the Company in connection with the delivery to any holder of a Note of information required to be delivered to such holder under this Agreement or requested by such holder (other than a holder that is a party to this Agreement or its nominee), such holder will enter into an agreement with the Company embodying this Section 20.

In the event that as a condition to receiving access to information relating to Xxxxxx REIT, the Company or any Subsidiary in connection with the transactions contemplated by or otherwise pursuant to this Agreement, any Purchaser or holder of a Note is required to agree to a confidentiality undertaking (whether through IntraLinks, another secure website, a secure virtual workspace or otherwise) which is different from this Section 20, this Section 20 shall not be amended thereby

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and, as between such Purchaser or such holder and the Company, this Section 20 shall supersede any such other confidentiality undertaking.


SECTION 21.	SUBSTITUTION OF PURCHASER.

Each Purchaser shall have the right to substitute any one of its Affiliates or another Purchaser or any one of such other Purchaser’s Affiliates (a “Substitute Purchaser”) as the purchaser of the Notes that it has agreed to purchase hereunder, by written notice to the Company, which notice shall be signed by both such Purchaser and such Substitute Purchaser, shall contain such Substitute Purchaser’s agreement to be bound by this Agreement and shall contain a confirmation by such Substitute Purchaser of the accuracy with respect to it of the representations set forth in Section 6. Upon receipt of such notice, any reference to such Purchaser in this Agreement (other than in this Section 21), shall be deemed to refer to such Substitute Purchaser in lieu of such original Purchaser. In the event that such Substitute Purchaser is so substituted as a Purchaser hereunder and such Substitute Purchaser thereafter transfers to such original Purchaser all of the Notes then held by such Substitute Purchaser, upon receipt by the Company of notice of such transfer, any reference to such Substitute Purchaser as a “Purchaser” in this Agreement (other than in this Section 21), shall no longer be deemed to refer to such Substitute Purchaser, but shall refer to such original Purchaser, and such original Purchaser shall again have all the rights of an original holder of the Notes under this Agreement.


SECTION 22.	MISCELLANEOUS.

Section 22.1. Successors and Assigns. All covenants and other agreements contained in this Agreement by or on behalf of any of the parties hereto bind and inure to the benefit of their respective successors and assigns (including, without limitation, any subsequent holder of a Note) whether so expressed or not.

Section 22.2. Accounting Terms. All accounting terms used herein which are not expressly defined in this Agreement have the meanings respectively given to them in accordance with GAAP. Except as otherwise specifically provided herein, (1) all computations made pursuant to this Agreement shall be made in accordance with GAAP, and (2) all financial statements shall be prepared in accordance with GAAP. For purposes of determining compliance with this Agreement (including, without limitation, Section 9, Section 10 and the definition of “Indebtedness”), any election by Xxxxxx REIT, the Company or any Subsidiary to measure any financial liability using fair value (as permitted by Financial Accounting Standards Board Accounting Standards Codification Topic No. 000-00-00 – Fair Value Option, International Accounting Standard 39 – Financial Instruments: Recognition and Measurement or any similar accounting standard) shall be disregarded and such determination shall be made as if such election had not been made. If at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth in this Agreement and either the Company or the Required Holders shall so request, the Purchasers and holders of the Notes and the Company shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP (subject to the approval of the Required Holders); provided that, until so amended, (a) such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein and (b) the Company shall provide to the Purchasers and holders of Notes financial statements and

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other documents required under this Agreement or as reasonably requested hereunder setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change in GAAP. Without limiting the foregoing, leases, whether entered into prior to or after the date of this Agreement, shall continue to be classified and accounted for on a basis consistent with that reflected in the financial statements listed on Schedule 5.5 for all purposes of this Agreement, notwithstanding any change in GAAP relating thereto, unless the Company and the Required Holders enter into an amendment addressing such changes. When determining compliance by the Company with any financial covenant contained in this Agreement, 100% of the financial attributes of a consolidated Affiliate of Xxxxxx REIT shall be included and only the Ownership Share of Xxxxxx REIT of the financial attributes of an Unconsolidated Affiliate shall be included.

Section 22.3. Severability. Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall (to the full extent permitted by law) not invalidate or render unenforceable such provision in any other jurisdiction.

Section 22.4. Construction, Etc. Each covenant contained herein shall be construed (absent express provision to the contrary) as being independent of each other covenant contained herein, so that compliance with any one covenant shall not (absent such an express contrary provision) be deemed to excuse compliance with any other covenant. Where any provision herein refers to action to be taken by any Person, or which such Person is prohibited from taking, such provision shall be applicable whether such action is taken directly or indirectly by such Person.

Section 22.5. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be an original but all of which together shall constitute one instrument. Each counterpart may consist of a number of copies hereof, each signed by less than all, but together signed by all, of the parties hereto.

Section 22.6. Governing Law. This Agreement shall be construed and enforced in accordance with, and the rights of the parties shall be governed by, the law of the State of New York excluding choice‑of‑law principles of the law of such State that would permit the application of the laws of a jurisdiction other than such State.

Section 22.7. Jurisdiction and Process; Waiver of Jury Trial.

(a) The Company irrevocably submits to the non-exclusive jurisdiction of any New York State or federal court sitting in the Borough of Manhattan, The City of New York, over any suit, action or proceeding arising out of or relating to this Agreement or the Notes. To the fullest extent permitted by applicable law, the Company irrevocably waives and agrees not to assert, by way of motion, as a defense or otherwise, any claim that it is not subject to the jurisdiction of any such court, any objection that it may now or hereafter have to the laying of the venue of any such suit, action or proceeding brought in any such court and any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum.

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(b) The Company consents to process being served by or on behalf of any holder of Notes in any suit, action or proceeding of the nature referred to in Section 22.7(a) by mailing a copy thereof by registered or certified mail (or any substantially similar form of mail), postage prepaid, return receipt requested, to it at its address specified in Section 18 or at such other address of which such holder shall then have been notified pursuant to said Section. The Company agrees that such service upon receipt (1) shall be deemed in every respect effective service of process upon it in any such suit, action or proceeding and (2) shall, to the fullest extent permitted by applicable law, be taken and held to be valid personal service upon and personal delivery to it. Notices hereunder shall be conclusively presumed received as evidenced by a delivery receipt furnished by the United States Postal Service or any reputable commercial delivery service.

(c) Nothing in this Section 22.7 shall affect the right of any holder of a Note to serve process in any manner permitted by law, or limit any right that the holders of any of the Notes may have to bring proceedings against the Company in the courts of any appropriate jurisdiction or to enforce in any lawful manner a judgment obtained in one jurisdiction in any other jurisdiction.

(d) THE PARTIES HERETO HEREBY WAIVE TRIAL BY JURY IN ANY ACTION BROUGHT ON OR WITH RESPECT TO THIS AGREEMENT, THE NOTES OR ANY OTHER DOCUMENT EXECUTED IN CONNECTION HEREWITH OR THEREWITH.

* * * * *

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If you are in agreement with the foregoing, please sign the form of agreement on a counterpart of this Agreement and return it to the Company, whereupon this Agreement shall become a binding agreement between you and the Company.

Very truly yours,

XXXXXX PACIFIC PROPERTIES, L.P.

By: Xxxxxx Pacific Properties, Inc.,
its general partner

By ____________________________

Its_________________________

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This Agreement is hereby

accepted and agreed to as

of the date hereof.

[ADD PURCHASER SIGNATURE BLOCKS]

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DEFINED TERMS

As used herein, the following terms have the respective meanings set forth below or set forth in the Section hereof following such term:

“Additional Covenant” is defined in Section 9.10.

“Adjusted EBITDA” means, with respect to a Person and for a given period, EBITDA of such Person less Capital Reserves of such Person.

“Affiliate” means, with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified. Unless the context otherwise clearly requires, any reference to an “Affiliate” is a reference to an Affiliate of the Company.

“Agreement” means this Agreement, including all Schedules and Exhibits attached to this Agreement, as it may be amended, restated, supplemented or otherwise modified from time to time.

“Anti-Corruption Laws” is defined in Section 5.16(d)(1).

“Anti-Money Laundering Laws” is defined in Section 5.16(c).

“Bankruptcy Code” means the Bankruptcy Code of 1978, as amended.

“Blocked Person” is defined in Section 5.16(a).

“Business Day” means (a) for the purposes of Section 8.6 only, any day other than a Saturday, a Sunday or a day on which commercial banks in New York City are required or authorized to be closed, and (b) for the purposes of any other provision of this Agreement, any day other than a Saturday, a Sunday or a day on which commercial banks in Los Angeles, California or New York, New York are required or authorized to be closed.

“Capital Reserves” means, for any period and with respect to a Property, an amount equal to (a) $0.25 per square foot for Office Properties, Mixed-Use Properties and Retail Properties or (b) $0.40 per square foot for Studio Properties multiplied by a fraction, the numerator of which is the number of days in such period and the denominator of which is 365. If the term Capital Reserves is used without reference to any specific Property, then the amount shall be determined on an aggregate basis with respect to all Properties of Xxxxxx REIT and its Subsidiaries on a consolidated basis and Xxxxxx REIT’s Ownership Share of all Properties of all Unconsolidated Affiliates.

SCHEDULE A
(to Note Purchase Agreement)

“Capitalization Rate” means, as applicable, (a) 6.00% for Office Properties, Mixed-Use Properties and Retail Properties and (b) 8.50% for Studio Properties; provided that, if any Material Credit Facility provides for a “capitalization rate” or similar rate for any type of Property described in clause (a) or (b) that is higher than the rate set forth in such clause, the applicable rate for such type of Property shall be such higher rate.

“Capitalized Lease Obligation” means obligations under a lease (to pay rent or other amounts under any lease or other arrangement conveying the right to use) that are required to be capitalized for financial reporting purposes in accordance with GAAP. The amount of a Capitalized Lease Obligation is the capitalized amount of such obligation as would be required to be reflected on a balance sheet of the applicable Person prepared in accordance with GAAP as of the applicable date.

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

“Change in Control” is defined in Section 8.7(g).

“Change in Control Notice” is defined in Section 8.7(a).

“Change in Control Proposed Prepayment Date” is defined in Section 8.7(b).

A-2

“CISADA” means the Comprehensive Iran Sanctions, Accountability and Divestment Act, as amended from time to time.

“Closing” is defined in Section 3.

“Closing Date” is defined in Section 3.

“Code” means the Internal Revenue Code of 1986, as amended from time to time, and the rules and regulations promulgated thereunder from time to time.

“Company” means Xxxxxx Pacific Properties, L.P., a Maryland limited partnership, or any successor that becomes such in the manner prescribed in Section 10.2.

“Company LP Agreement” means the Fourth Amended and Restated Agreement of Limited Partnership of the Company, dated as of December 17, 2015, as amended, supplemented or otherwise modified from time to time.

“Company Preferred Units” means the Company’s Series A Preferred Units as defined in the Company LP Agreement.

“Confidential Information” is defined in Section 20.

“Construction-in-Progress” means Property undergoing ground-up construction, but not yet completed. Such Property shall cease to be Construction-in-Progress and shall thereafter be valued using the applicable Capitalization Rate (instead of book value) for purposes of determining Total Asset Value, (a) if Development Completion occurs at any time during the first month of a fiscal quarter, at the end of such fiscal quarter or (b) if Development Completion occurs after the first month of a fiscal quarter, at the end of the following fiscal quarter. For purposes hereof “Development Completion” means the earlier of (1) 12 months after substantial completion of all improvements (other than tenant improvements of unoccupied space) related to the development of such Property and (2) such time as Construction-in-Progress achieves an Occupancy Rate of at least 80%.

“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. “Controlling” and “Controlled” have meanings correlative thereto.

“Controlled Entity” means (a) any of the Subsidiaries of the Company and any of their or the Company’s respective Controlled Affiliates and (b) if the Company has a parent company, such parent company and its Controlled Affiliates.

A-3

“Default” means an event or condition the occurrence or existence of which would, with the lapse of time or the giving of notice or both, become an Event of Default.

“Default Rate” means, with respect to any Note, that per annum rate of interest that is the greater of (a) 2.00% above the rate of interest stated in clause (a) of the first paragraph of such Note or (b) 2.00% over the rate of interest publicly announced by Xxxxx Fargo Bank, National Association in New York, New York as its “base” or “prime” rate.

“Derivatives Contract” means a “swap agreement” as defined in Section 101 of the Bankruptcy Code.

“Derivatives Termination Value” means, in respect of any one or more Derivatives Contracts, after taking into account the effect of any legally enforceable netting agreement or provision relating thereto, (a) for any date on or after the date such Derivatives Contracts have been terminated or closed out, the termination amount or value determined in accordance therewith, and (b) for any date prior to the date such Derivatives Contracts have been terminated or closed out, the then-current xxxx-to-market value for such Derivatives Contracts, determined based upon one or more mid-market quotations or estimates provided by any recognized dealer in Derivatives Contracts.

“Disclosure Documents” is defined in Section 5.3.

“EBITDA” means, with respect to a Person for a given period and without duplication, the sum of (a) net income (or loss) of such Person for such period determined on a consolidated basis exclusive of the following (but only to the extent included in the determination of such net income (loss) for such period): (1) depreciation and amortization; (2) Interest Expense; (3) income tax expense; (4) non-cash compensation and (5) extraordinary or nonrecurring items, including, without limitation, gains and losses from the sale of operating Properties (but not from the sale of Properties developed for the purpose of sale); plus (b) such Person’s pro rata share of EBITDA of its Unconsolidated Affiliates. EBITDA shall be adjusted to remove any impact from straight line rent leveling adjustments required under GAAP, amortization of intangibles pursuant to FASB ASC 805, amortization of deferred financing costs, and non-cash compensation expenses (to the extent such adjustments would otherwise have been included in the determination of EBITDA). For purposes of this definition, nonrecurring items shall be deemed to include (i) transaction costs incurred in connection herewith and the retirement of all or a portion of the Indebtedness under the Company’s Second Amended and Restated Credit Agreement or Term Loan Credit Agreement, each dated as of Xxxxx 00, 0000, (xx) gains and losses on early extinguishment of Indebtedness, (iii) non- cash severance and other non-cash restructuring charges and (iv) transaction costs of acquisitions not permitted to be capitalized pursuant to GAAP.

A-4

“XXXXX” means the SEC’s Electronic Data Gathering, Analysis and Retrieval System or any successor SEC electronic filing system for such purposes.

“Eligible Property” means a Property which satisfies all of the following requirements: (a) such Property is an Office Property or Studio Property; (b) the Property is 100% owned, or leased under a Ground Lease, by Xxxxxx REIT, the Company and/or a Subsidiary Guarantor; (c) neither such Property, nor any interest of Xxxxxx REIT, the Company or any Subsidiary Guarantor therein, is subject to any Lien (other than Permitted Liens, except Permitted Liens described in clause (g) of the definition thereof) or a Negative Pledge (other than a Negative Pledge expressly permitted under Section 10.4); (d) if such Property is owned or leased by a Subsidiary Guarantor (1) none of Xxxxxx REIT’s or the Company’s ownership interest in such Subsidiary Guarantor is subject to any Lien (other than Permitted Liens) or to a Negative Pledge (other than a Negative Pledge expressly permitted under Section 10.4); and (2) other than with respect to the Properties that are subject to the Ground Leases set forth on Schedule 5.10(a), Xxxxxx REIT or the Company directly, or indirectly through a Subsidiary, has the right to take the following actions without the need to obtain the consent of any Person: (i) to sell, transfer or otherwise dispose of such Property and (ii) to create a Lien on such Property as security for Indebtedness of Xxxxxx REIT, the Company or such Subsidiary Guarantor, as applicable; and (e) such Property is free of all structural defects or major architectural deficiencies, title defects, environmental conditions or other adverse matters except for defects, deficiencies, conditions or other matters individually or collectively which are not material to the profitable operation or marketability of such Property. During such time as the owner of any Unencumbered Pool Property that is a Subsidiary is not required to become a party to a Subsidiary Guaranty pursuant to Section 9.9, the conditions of this definition requiring that such Unencumbered Pool Property be owned by a Subsidiary Guarantor shall be deemed modified to require that such Unencumbered Pool Property be owned by a Subsidiary.

“Environmental Laws” means all international, foreign, federal, state and local statutes, treaties, rules, guidelines, regulations, ordinances, codes, executive orders, and administrative or judicial precedents or authorities, including the interpretation or administration thereof by any Governmental Authority charged with the enforcement, interpretation or administration thereof, and all applicable administrative orders, directed duties, requests, licenses, authorizations and permits of, and agreements with, any Governmental Authority, in each case whether or not having the force of law relating to environmental protection or the manufacture, storage, remediation, disposal or clean-up of Hazardous Materials including, without limitation, the following: Clean Air Act, 42 U.S.C. § 7401 et seq.; Federal Water Pollution Control Act, 33 U.S.C. § 1251 et seq.; Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act, 42 U.S.C. § 6901 et seq.; Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. § 9601 et seq.; National Environmental Policy Act, 42 U.S.C. § 4321 et seq.; regulations of the Environmental Protection Agency, any applicable rule of common law relating primarily to the

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environment or Hazardous Materials, and any analogous or comparable state or local laws, regulations or ordinances that concern Hazardous Materials or protection of the environment.

“Equity Interest” means, with respect to any Person, any share of capital stock of (or other ownership or profit interests in) such Person, any warrant, option or other right for the purchase or other acquisition from such Person of any share of capital stock of (or other ownership or profit interests in) such Person, whether or not certificated, any security convertible into or exchangeable for any share of capital stock of (or other ownership or profit interests in) such Person or warrant, right or option for the purchase or other acquisition from such Person of such shares (or such other interests), and any other ownership or profit interest in such Person (including, without limitation, partnership, member or trust interests therein), whether voting or nonvoting, and whether or not such share, warrant, option, right or other interest is authorized or otherwise existing on any date of determination.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time, and the rules and regulations promulgated thereunder from time to time in effect.

“ERISA Affiliate” means any trade or business (whether or not incorporated) that is treated as a single employer together with the Company under section 414 of the Code.

“Event of Default” is defined in Section 11.

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time.

“Excluded Subsidiary” means (a) any Material Subsidiary (1) holding title to assets that are or are to become within 90 days (subject to extension by the Required Holders) of acquisition or refinancing collateral for any Secured Indebtedness of such Subsidiary and that is (or will be) prohibited from Guaranteeing the Indebtedness of any other Person pursuant to (i) any document, instrument, or agreement evidencing such Secured Indebtedness or (ii) a provision of such Subsidiary’s organizational documents which provision was included in such Subsidiary’s organizational documents as a condition to the extension of such Secured Indebtedness or (2) prohibited from Guaranteeing the Indebtedness of any other Person pursuant to a provision of such Subsidiary’s organizational documents which provision was required by a third party equity owner of such Subsidiary or (b) any Foreign Subsidiary or Foreign Subsidiary Holding Company.

“Existing NPA” means that certain Note Purchase Agreement, dated as of November 16, 2015, by and among the Company, Xxxxxx REIT and the Purchasers party thereto, as the same may be amended, amended and restated, supplemented or otherwise modified from time to time.

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“Existing NPA Execution Date” means the “Execution Date” as defined in the Existing Note Purchase Agreement.

“FASB” means the Financial Accounting Standards Board.

“FASB ASC” means the Accounting Standards Codification of the FASB.

“Financial Covenant” means any covenant (whether set forth as a covenant, undertaking, event of default, restriction, prepayment event or other such provision) that requires Xxxxxx REIT, the Company and/or any Subsidiary to:

(a) maintain a specified level of net worth, shareholders’ equity, total assets, unencumbered assets, unencumbered properties, cash flow, net income, occupancy rate or lease term;

(b) maintain any relationship of any component of its capital structure to any other component thereof (including, without limitation, the relationship of indebtedness, subsidiary indebtedness, senior indebtedness, secured indebtedness, unsecured indebtedness, or subordinated indebtedness to total capitalization, total assets, unencumbered assets or to net worth);

(c) maintain any measure of its ability to service its indebtedness (including, without limitation, exceeding any specified ratio of revenues, cash flow, operating income or net income to indebtedness, interest expense, rental expense, capital expenditures and/or scheduled payments of indebtedness); or

(d) restrict the amount or type of its investments;

but in all cases excluding any such covenant that amounts to a negative pledge or a sale of assets limitation.

“First Closing” is defined in Section 3.

“First Closing Date” is defined in Section 3.

“Fitch” means Fitch Ratings, a division of Fitch, Inc., or any successor.

“Fixed Charges” means, with respect to a Person and for a given period, the sum of (a) the Interest Expense of such Person for such period, plus (b) the aggregate of all scheduled principal payments on Indebtedness made by such Person (including, in the case of Xxxxxx REIT, Xxxxxx

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REIT’s Ownership Share of such payments made by any of its Unconsolidated Affiliates) during such period (excluding balloon, bullet or similar payments of principal due upon the stated maturity of Indebtedness), plus (c) the aggregate of all Preferred Dividends paid or accrued by such Person (including, in the case of Xxxxxx REIT, Xxxxxx REIT’s Ownership Share of such dividends paid or accrued by any of its Unconsolidated Affiliates) on any Preferred Equity Interest during such period.

“Foreign Subsidiary” means any Subsidiary of the Company that is not organized under the laws of any jurisdiction within the United States of America.

“Foreign Subsidiary Holding Company” means any Subsidiary of the Company that is organized under the laws of any jurisdiction within the United States of America, all or substantially all of the assets of which are Equity Interests (or equity and debt interests) in a Foreign Subsidiary (or Foreign Subsidiaries).

“Form 10‑K” is defined in Section 7.1(b).

“Form 10‑Q” is defined in Section 7.1(a).

“Funds From Operations” means, with respect to a Person and for a given period, (a) net income (loss) of such Person determined on a consolidated basis for such period, minus (or plus) (b) gains (or losses) from debt restructuring and sales of property during such period, plus (c) depreciation with respect to such Person’s real estate assets and amortization (other than amortization of deferred financing costs) of such Person for such period, all after adjustment for unconsolidated partnerships and joint ventures, plus (d) transaction costs of acquisitions not permitted to be capitalized pursuant to GAAP. Adjustments for unconsolidated entities will be calculated to reflect funds from operations on the same basis.

“GAAP” means generally accepted accounting principles as in effect from time to time in the United States of America.

“Governmental Authority” means

(a) the government of

(1) the United States of America or any state or other political subdivision thereof, or

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(2) any other jurisdiction in which Xxxxxx REIT, the Company or any Subsidiary conducts all or any part of its business, or which asserts jurisdiction over any properties of Xxxxxx REIT, the Company or any Subsidiary, or

(b) any entity exercising executive, legislative, judicial, regulatory or administrative functions of, or pertaining to, any such government.

“Governmental Official” means any governmental official or employee, employee of any government-owned or government-controlled entity, political party, any official of a political party, candidate for political office, official of any public international organization or anyone else acting in an official capacity.

“Ground Lease” means a ground lease or sub-lease containing the following terms and conditions: (a) a remaining term (exclusive of any unexercised extension options) of 30 years or more from the Existing NPA Execution Date; provided that the ground leases set forth on Schedule 5.10(a) shall not be subject to this remaining term requirement of at least 30 years; (b) the right of the lessee to mortgage and encumber its interest in the leased property without the consent of the lessor, or where the lessor has provided its consent to such encumbrance; (c) the obligation of the lessor to give the holder of any mortgage Lien on such leased property written notice of any defaults on the part of the lessee and agreement of such lessor that such lease will not be terminated until such holder has had a reasonable opportunity to cure or complete foreclosures, and fails to do so; (d) reasonable transferability of the lessee’s interest under such lease, including ability to sublease; and (e) such other rights customarily required by mortgagees making a loan secured by the interest of the holder of the leasehold estate demised pursuant to a ground lease.

“Guarantors” means Xxxxxx REIT and each Subsidiary Guarantor, and “Guarantor” means any of them.

“Guaranty,” “Guaranties,” “Guaranteed” or to “Guarantee” as applied to any obligation means and includes: (a) a guaranty (other than by endorsement of negotiable instruments for collection in the ordinary course of business), directly or indirectly, in any manner, of any part or all of such obligation, or (b) an agreement, direct or indirect, contingent or otherwise, and whether or not constituting a guaranty, the practical effect of which is to assure the payment or performance (or payment of damages in the event of nonperformance) of any part or all of such obligation whether by: (1) the purchase of securities or obligations, (2) the purchase, sale or lease (as lessee or lessor) of property or the purchase or sale of services primarily for the purpose of enabling the obligor with respect to such obligation to make any payment or performance (or payment of damages in the event of nonperformance) of or on account of any part or all of such obligation, or to assure the owner of such obligation against loss, (3) the supplying of funds to or in any other manner investing

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in the obligor with respect to such obligation, (4) repayment of amounts drawn down by beneficiaries of letters of credit or (5) the supplying of funds to or investing in a Person on account of all or any part of such Person’s obligation under a Guaranty of any obligation or indemnifying or holding harmless, in any way, such Person against any part or all of such obligation. As the context requires, “Guaranty” shall also mean the guaranty executed and delivered pursuant to Section 2.2 or Section 9.9.

“Guaranty Agreements” means the Parent Guaranty and each Subsidiary Guaranty, and “Guaranty Agreement” means any of them.

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

“holder” means, with respect to any Note, the Person in whose name such Note is registered in the register maintained by the Company pursuant to Section 13.1, provided, however, that if such Person is a nominee, then for the purposes of Sections 7, 8.7, 12, 17.2 and 18 and any related definitions in this Schedule B, “holder” shall mean the beneficial owner of such Note whose name and address appears in such register.

“Xxxxxx REIT” means Xxxxxx Pacific Properties, Inc., a Maryland corporation, or any successor that becomes such in the manner prescribed in Section 10.2.

“Indebtedness” means, with respect to a Person, at the time of computation thereof, all of the following (without duplication): (a) all obligations of such Person in respect of money borrowed; (b) all obligations of such Person, whether or not for money borrowed (1) represented by notes payable, or drafts accepted, in each case representing extensions of credit, (2) evidenced by bonds, debentures, notes or similar instruments, or (3) constituting purchase money indebtedness, conditional sales contracts, title retention debt instruments or other similar instruments, upon which interest charges are customarily paid or that are issued or assumed as full or partial payment for property or services rendered other than trade payables incurred in the ordinary course of such

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Person’s business which are not past due for more than 30 days or such payables are being contested in good faith and for which adequate reserves have been set aside; (c) Capitalized Lease Obligations of such Person (including Ground Leases to the extent required under GAAP to be reported as a liability); (d) all reimbursement obligations of such Person under any letters of credit or acceptances (whether or not the same have been presented for payment); (e) all Off-Balance Sheet Obligations of such Person; (f) all obligations of such Person to purchase, redeem, retire, defease or otherwise make any payment in respect of any Mandatorily Redeemable Stock issued by such Person or any other Person, valued at the greater of its voluntary or involuntary liquidation preference plus accrued and unpaid dividends; (g) all obligations of such Person in respect of any equity redemption obligation, repurchase obligation, takeout commitment or forward equity commitment, in each case evidenced by a binding agreement (excluding any such obligation to the extent the obligation can be satisfied by the issuance of Equity Interests (other than Mandatorily Redeemable Stock)); (h) net obligations under any Derivatives Contract not entered into as a hedge against existing Indebtedness, in an amount equal to the Derivatives Termination Value thereof; (i) all Indebtedness of other Persons which such Person has Guaranteed or is otherwise recourse to such Person (except for Guaranties of customary exceptions for fraud, misapplication of funds, environmental indemnities and other similar customary exceptions to recourse liability or exceptions relating to bankruptcy, insolvency, receivership or other similar events, provided that the obligations under such Guaranty have not become due and payable); (j) all Indebtedness of another Person secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property or assets owned by such Person, even though such Person has not assumed or become liable for the payment of such Indebtedness or other payment obligation; (k) any sale-leaseback transactions or other transaction by which such Person shall remain liable as lessee (or the economic equivalent thereof) of any real or personal property that it has sold or leased to another Person and (l) the Indebtedness of any consolidated Affiliate of such Person and such Person’s Ownership Share of the Indebtedness of any Unconsolidated Affiliate of such Person.

“INHAM Exemption” is defined in Section 6.2(e).

“Institutional Investor” means (a) any Purchaser of a Note, (b) any holder of a Note holding (together with one or more of its affiliates) more than 10% of the aggregate principal amount of the Notes then outstanding, (c) any bank, trust company, savings and loan association or other financial institution, any pension plan, any investment company, any insurance company, any broker or dealer, or any other similar financial institution or entity, regardless of legal form, and (d) any Related Fund of any holder of any Note.

“Interest Expense” means, for any period, without duplication, (a) total interest expense of Xxxxxx REIT, including capitalized interest not funded under a construction loan interest reserve account, determined on a consolidated basis in accordance with GAAP for such period, plus (b)

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Xxxxxx REIT’s Ownership Share of Interest Expense of Unconsolidated Affiliates for such period, but, in each case, excluding any non-cash interest expense (except for the payment-in-kind interest expense) including, but not limited to, amortization of deferred financing costs.

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

“Lien” as applied to the property of any Person means: (a) any security interest, encumbrance, mortgage, deed to secure debt, deed of trust, assignment of leases and rents, pledge, lien, hypothecation, assignment, charge or lease constituting a Capitalized Lease Obligation, conditional sale or other title retention agreement, or other security title or encumbrance of any kind in respect of any property of such Person, or upon the income, rents or profits therefrom; (b) any arrangement, express or implied, under which any property of such Person is transferred, sequestered or otherwise identified for the purpose of subjecting the same to the payment of Indebtedness or performance of any other obligation in priority to the payment of the general, unsecured creditors of such Person; and (c) the filing of any financing statement under the UCC or its equivalent in any jurisdiction, other than any precautionary filing not otherwise constituting or giving rise to a lien, including a financing statement filed (1) in respect of a lease not constituting a Capitalized Lease Obligation pursuant to Section 9-505 (or a successor provision) of the UCC or its equivalent as in effect in an applicable jurisdiction or (2) in connection with a sale or other disposition of accounts or other assets not prohibited by this Agreement in a transaction not otherwise constituting or giving rise to a lien.

“Make-Whole Amount” is defined in Section 8.6.

“Mandatorily Redeemable Stock” means, with respect to any Person, any Equity Interest of such Person which by the terms of such Equity Interest (or by the terms of any security into which it is convertible or for which it is exchangeable or exercisable), upon the happening of any event or otherwise (a) matures or is mandatorily redeemable, pursuant to a sinking fund obligation

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or otherwise (other than an Equity Interest to the extent redeemable in exchange for common stock or other equivalent common Equity Interests), (b) is convertible into or exchangeable or exercisable for Indebtedness, or (c) is redeemable at the option of the holder thereof, in whole or in part (other than an Equity Interest which is redeemable in exchange for common stock or other equivalent common Equity Interests, or, at the option of the Person responding to the redemption, for cash in lieu of Equity Interests, or a combination thereof); in each case, on or prior to the latest Maturity Date of any Note.

“Material” means material in relation to the business, operations, affairs, financial condition, assets, properties, or prospects of the Company and its Subsidiaries taken as a whole.

“Material Acquisition” means any acquisition of assets by Xxxxxx REIT, the Company or any Subsidiary in which the assets acquired exceed 10% of the then Total Asset Value (not taking into account such new acquisition).

“Material Adverse Effect” means a material adverse effect on (a) the business, operations, financial condition, assets or properties of the Company and its Subsidiaries taken as a whole, (b) the ability of the Company to perform its obligations under this Agreement and the Notes, (c) the ability of any Guarantor to perform its obligations under its Guaranty Agreement, or (d) the validity or enforceability of this Agreement, the Notes or any Guaranty Agreement.

“Material Credit Facility” means, as to Xxxxxx REIT, the Company or any Subsidiary,

(a) (1) the Second Amended and Restated Credit Agreement dated as of March 31, 2015 among the Company, various financial institutions and Xxxxx Fargo Bank, National Association, as administrative agent, and (2) the Term Loan Credit Agreement dated as of November 17, 2015 among the Company, various financial institutions and Xxxxx Fargo Bank, National Association, as administrative agent, including in each case any renewals, extensions, amendments, supplements, restatements, replacements or refinancing thereof;

(b) the Existing NPA; and

(c) any other agreement(s) creating or evidencing Recourse Indebtedness entered into on or after the date of this Agreement by Xxxxxx REIT, the Company or any Subsidiary, or in respect of which Xxxxxx REIT, the Company or any Subsidiary is an obligor or otherwise provides a Guaranty or other credit support, except for completion and repayment Guaranties in respect of construction financings and customary nonrecourse carve-out Guaranties, environmental indemnities and other similar customary exceptions to recourse liability; provided that none of the foregoing have become due and payable, and except for recourse to a special purpose entity created solely for the purpose of holding such assets (a “Credit Facility”), in a principal amount outstanding or available for borrowing equal to or greater than $100,000,000 (or the equivalent of such amount in the relevant currency of

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payment, determined as of the date of the closing of such facility based on the exchange rate of such other currency).

“Material Subsidiary” means any Subsidiary to which more than 3% of Total Asset Value, determined exclusive of cash and Cash Equivalents and exclusive of assets that are owned by (a) Excluded Subsidiaries or (b) Unconsolidated Affiliates, is attributable on an individual basis.

“Maturity Date” with respect to any Note is defined in the first paragraph of such Note.

“Memorandum” is defined in Section 5.3.

“Mixed-Use Property” means any mixed-use project that includes or will include a Retail Property and will also include a multifamily property and/or an Office Property.

“Moody’s” means Xxxxx’x Investors Service, Inc., or any successor.

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

“Mortgage Receivable” means a promissory note secured by a Mortgage of which Xxxxxx REIT, the Company or a Subsidiary is the holder and retains the rights of collection of all payments thereunder.

“Most Favored Lender Notice” means, in respect of any Additional Covenant, a written notice from the Company giving notice of such Additional Covenant, including therein a verbatim statement of such Additional Covenant, together with any definitions incorporated therein.

“Multiemployer Plan” means any Plan that is a “multiemployer plan” (as such term is defined in section 4001(a)(3) of ERISA) to which the Company or any ERISA Affiliate thereof makes or is obligated to make contributions, or during the preceding six plan years, has made or been obligated to make contributions.

“NAIC” means the National Association of Insurance Commissioners or any successor thereto.

“Negative Pledge” means, with respect to a given asset, any provision of a document, instrument or agreement (other than this Agreement) which prohibits or purports to prohibit the creation or assumption of any Lien on such asset as security for Indebtedness of the Person owning such asset or any other Person; provided that an agreement that conditions a Person’s ability to encumber its assets upon the maintenance of one or more specified ratios that limit such Person’s

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ability to encumber its assets but that do not generally prohibit the encumbrance of its assets, or the encumbrance of specific assets, shall not constitute a Negative Pledge.

“Net Operating Income” or “NOI” means, for any Property and for a given period, the sum of the following (without duplication and determined on a consistent basis with prior periods): (a) rents and other revenues received in the ordinary course from such Property (including proceeds of rent loss or business interruption insurance, but excluding pre-paid rents and revenues and security deposits except to the extent applied in satisfaction of tenants’ obligations for rent) minus (b) all expenses paid (excluding interest, but including an appropriate accrual for property taxes and insurance) related to the ownership, operation or maintenance of such Property, including but not limited to property taxes, assessments and the like, insurance, utilities, payroll costs, maintenance, repair and landscaping expenses, marketing expenses, and general and administrative expenses (including an appropriate allocation for legal, accounting, advertising, marketing and other expenses incurred in connection with such Property, but specifically excluding (1) general overhead expenses of the Company or any Subsidiary and any property management fees; (2) straight line rent leveling adjustments required under GAAP; (3) amortization of intangibles pursuant to FASB ASC 805; and (4) extraordinary or nonrecurring items, including, to the extent allocable to such Property, (i) gains and losses on early extinguishment of Indebtedness, (ii) non-cash severance and other non-cash restructuring charges and (iii) transaction costs of acquisitions not permitted to be capitalized pursuant to GAAP) minus (c) the Capital Reserves for such Property as of the end of such period minus (d) the greater of (1) the actual property management fee paid during such period and (2) an imputed management fee in the amount of 3% of the gross revenues for such Property for such period.

“Nonrecourse Indebtedness” means, with respect to a Person, Indebtedness for borrowed money in respect of which recourse for payment (except for customary nonrecourse carve-out Guaranties, environmental indemnities, and other similar customary exceptions to recourse liability, provided that none of the foregoing have become due and payable, and except for recourse to a special purpose entity created solely for the purpose of holding such assets) is contractually limited to specific assets of such Person encumbered by a Lien securing such Indebtedness.

“Notes” is defined in Section 1.

“Occupancy Rate” means, with respect to a Property at any time, the ratio, expressed as a percentage, of (a) the number of square feet of such Property actually leased or occupied by unaffiliated third-party tenants subject to arm’s-length leases as to which no monetary default has occurred and has continued unremedied for 90 or more days to (b) the aggregate number of rentable square feet of such Property.

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“OFAC” is defined in Section 5.16(a).

“OFAC Listed Person” is defined in Section 5.16(a).

“OFAC Sanctions Program” means any economic or trade sanction that OFAC is responsible for administering and enforcing. A list of OFAC Sanctions Programs may be found at xxxx://xxx.xxxxxxxx.xxx/xxxxxxxx-xxxxxx/xxxxxxxxx/Xxxxxxxx/Xxxxx/Xxxxxxxx.xxxx.

“Off-Balance Sheet Obligations” means liabilities and obligations of Xxxxxx REIT, the Company, any Subsidiary or any other Person in respect of “off-balance sheet arrangements” (as defined in Item 303(a)(4)(ii) of Regulation S-K promulgated under the Securities Act) which Xxxxxx REIT would be required to disclose in the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section of Xxxxxx REIT’s report on Form 10-Q or Form 10-K (or their equivalents) which Xxxxxx REIT is required to file with the SEC.

“Office Property” means a Property improved with a building or buildings the substantial use of which is office space, which may include a Property that is part of a Mixed-Use Property.

“Officer’s Certificate” means, with respect to any Person, a certificate of a Senior Financial Officer or of any other officer of such Person whose responsibilities extend to the subject matter of such certificate.

“Ownership Share” means, with respect to any Unconsolidated Affiliate of a Person, the greater of (a) such Person’s relative nominal direct and indirect ownership interest (expressed as a percentage) in such Unconsolidated Affiliate or (b) subject to compliance with Section 7.1(i), such Person’s relative direct and indirect economic interest (calculated as a percentage) in such Unconsolidated Affiliate determined in accordance with the applicable provisions of the declaration of trust, articles or certificate of incorporation, articles of organization, partnership agreement, joint venture agreement or other applicable organizational document of such Unconsolidated Affiliate.

“Parent Guaranty” is defined in Section 2.2.

“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA or any successor thereto.

“Pension Plan” means any employee pension benefit plan as defined in Section 3(2) of ERISA (but not a Multiemployer Plan) that is maintained or contributed by the Company or any ERISA Affiliate and is either covered by Title IV of ERISA or is subject to the minimum funding standards under Section 412 of the Code.

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“Permitted Liens” means, as to any Person, (a) Liens securing taxes, assessments and other charges or levies imposed by any Governmental Authority (excluding any lien imposed pursuant to any of the provisions of ERISA or pursuant to any Environmental Laws) or the claims of materialmen, mechanics, carriers, warehousemen or landlords for labor, materials, supplies or rentals incurred in the ordinary course of business, which are not at the time required to be paid or discharged under Section 9.4; (b) Liens consisting of deposits or pledges made, in the ordinary course of business, in connection with, or to secure payment of, obligations under workers’ compensation, unemployment insurance or similar applicable law or performance of bids, trade contracts (other than for borrowed money), leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature; (c) covenants, conditions, zoning restrictions, easements, rights, restrictions and other encumbrances on title to the real property, which do not materially detract from the value and/or marketability of such property or impair the intended use thereof in the business of such Person; (d) the rights of tenants under leases or subleases not interfering with the ordinary conduct of business of such Person; (e) Liens securing the Notes, (f) Liens in favor of Xxxxxx REIT, the Company or a Subsidiary Guarantor securing obligations owing by a Subsidiary to Xxxxxx REIT, the Company or a Subsidiary Guarantor; (g) purchase money liens so long as no such Lien is spread to cover any property other than that which is purchased and the amount of Indebtedness secured thereby is limited to the purchase price and (h) Liens in existence as of the date of this Agreement and set forth on Schedule 5.10(a) and with respect to any Property that the Company proposes to add to the Unencumbered Pool after the date of this Agreement, Liens in existence as of the date such Property is proposed to be added to the Unencumbered Pool to the extent that such Liens have been approved by the Required Holders and are set forth on a supplement to Schedule 5.10(a).

“Person” means an individual, partnership, corporation, limited liability company, association, trust, unincorporated organization, business entity or Governmental Authority.

“Plan” means an “employee benefit plan” (as defined in section 3(3) of ERISA) subject to ERISA that is or, within the preceding six years, has been established or maintained, or to which contributions are or, within the preceding six years, have been made or required to be made, by the Company or any ERISA Affiliate or with respect to which the Company or any ERISA Affiliate may have any liability.

“Preferred Dividends” means, for any period and without duplication, all Restricted Payments paid during such period on Preferred Equity Interests issued by the Company or a Subsidiary. Preferred Dividends shall not include dividends or distributions (a) paid or payable solely in Equity Interests (other than Mandatorily Redeemable Stock) payable to holders of such class of Equity Interests, (b) paid or payable to Xxxxxx REIT, the Company or a Subsidiary, or (c)

A-17

constituting or resulting in the redemption of Preferred Equity Interests, other than scheduled redemptions not constituting balloon, bullet or similar redemptions in full.

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

“property” or “properties” means, unless otherwise specifically limited, real or personal property of any kind, tangible or intangible, xxxxxx or inchoate.

“Property” means any parcel of real property owned or leased (in whole or in part) or operated by the Company, Xxxxxx REIT, any Subsidiary or any Unconsolidated Affiliate of Xxxxxx REIT and which is located in a state of the United States of America or the District of Columbia.

“PTE” is defined in Section 6.2(a).

“Purchaser” or “Purchasers” means each of the purchasers that has executed and delivered this Agreement to the Company and such Purchaser’s successors and assigns (so long as any such assignment complies with Section 13.2), provided, however, that any Purchaser of a Note that ceases to be the registered holder or a beneficial owner (through a nominee) of such Note as the result of a transfer thereof pursuant to Section 13.2 shall cease to be included within the meaning of “Purchaser” of such Note for the purposes of this Agreement upon such transfer.

“QPAM Exemption” is defined in Section 6.2(d).

“Qualified Institutional Buyer” means any Person who is a “qualified institutional buyer” within the meaning of such term as set forth in Rule 144A(a)(1) under the Securities Act.

“Recourse Indebtedness” means, with respect to a Person, Indebtedness for borrowed money that is not Nonrecourse Indebtedness.

“REIT” means a Person qualifying for treatment as a “real estate investment trust” under Sections 856 through 860 of the Code.

“Related Fund” means, with respect to any holder of any Note, any fund or entity that (a) invests in Securities or bank loans, and (b) is advised or managed by such holder, the same investment advisor as such holder or by an affiliate of such holder or such investment advisor.

“Renovation Property” means a Property (a) on which the existing building or other improvements are undergoing renovation and redevelopment that will (1) disrupt the occupancy of

A-18

at least 40% of the square footage of such Property or (2) temporarily reduce the Net Operating Income attributable to such Property by more than 40% as compared to the immediately preceding comparable prior period or (b) which is acquired with occupancy of less than 60% and on which renovation and redevelopment will be conducted. A Property shall cease to be a Renovation Property, (i) if Renovation Completion occurs at any time during the first month of a fiscal quarter, at the end of such fiscal quarter or (ii) if Renovation Completion occurs after the first month of a fiscal quarter, at the end of the following fiscal quarter after Renovation Completion. For purposes hereof “Renovation Completion” means the earliest to occur of (A) 12 months after all improvements (other than tenant improvements on unoccupied space) related to the redevelopment of such Property having been substantially completed and (B) such Property achieving an Occupancy Rate of at least 80%.

“Required Holders” means, at any time (a) after the First Closing and prior to the Second Closing, the holders of more than 50% in principal amount of the Notes at the time outstanding (exclusive of Notes then owned by Xxxxxx REIT, the Company or any Affiliate) and the Purchasers of the Series E Notes and (b) on or after the Second Closing, the holders of more than 50% in principal amount of the Notes at the time outstanding (exclusive of Notes then owned by Xxxxxx REIT, the Company or any Affiliate).

“Responsible Officer” means, with respect to any Person, any Senior Financial Officer and any other officer of such Person with responsibility for the administration of the relevant portion of this Agreement.

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

“Retail Property” means a Property improved with a building or buildings the substantial use of which is retail space, which may include a Property that is part of a Mixed-Use Property.

“S&P” means Standard & Poor’s Ratings Services, a Standard & Poor’s Financial Services LLC business, or any successor.

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“SEC” means the Securities and Exchange Commission of the United States, or any successor thereto.

“Second Closing” is defined in Section 3.

“Second Closing Date” is defined in Section 3.

“Secured Indebtedness” means (without duplication), with respect to a Person as of any given date, the aggregate principal amount of all Indebtedness of such Person or its Subsidiaries outstanding at such date on a consolidated basis and that is secured in any manner by any Lien, and in the case of Xxxxxx REIT (without duplication), Xxxxxx REIT’s Ownership Share of the Secured Indebtedness of its Unconsolidated Affiliates.

“Securities” or “Security” shall have the meaning specified in section 2(1) of the Securities Act.

“Securities Act” means the Securities Act of 1933, as amended from time to time, and the rules and regulations promulgated thereunder from time to time in effect.

“Senior Financial Officer” means, with respect to any Person, the chief financial officer, principal accounting officer, treasurer or comptroller of such Person.

“Series D Notes” is defined in Section 1.

“Series E Notes” is defined in Section 1.

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

“Source” is defined in Section 6.2.

“Specified Existing Investors” means The Blackstone Group L.P. and Affiliates thereof.

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“Studio Property” means a Property the substantial use of which is production studios, stages, control rooms and/or other audio and video room space, office and other support space, storage facilities and other incidental uses related thereto.

“Subsidiary” means, for any Person, any corporation, partnership, limited liability company or other entity of which at least a majority of the Equity Interests having by the terms thereof ordinary voting power to elect a majority of the board of directors or other individuals performing similar functions of such corporation, partnership, limited liability company or other entity (without regard to the occurrence of any contingency) is at the time directly or indirectly owned or controlled by such Person or one or more Subsidiaries of such Person or by such Person and one or more Subsidiaries of such Person, and shall include all Persons the accounts of which are consolidated with those of such Person pursuant to GAAP. Unless the context otherwise clearly requires, any reference to a “Subsidiary” is a reference to a Subsidiary of the Company.

“Subsidiary Guarantor” means (a) each Subsidiary that has executed and delivered a Subsidiary Guaranty or (b) if no Subsidiary Guaranties are then required by Section 9.9, (1) each Material Subsidiary (other than an Excluded Subsidiary) to the extent that such Subsidiary is a “Subsidiary Guarantor” or treated as the equivalent under a Material Credit Facility and (2) each Subsidiary that then owns a Property that is part of the Unencumbered Pool.

“Subsidiary Guaranty” is defined in Section 9.9(a)(1).

“Substantial Amount” means, at the time of determination thereof, an amount in excess of 30% of the undepreciated book value of the total consolidated assets at such time of the Company and its Subsidiaries determined on a consolidated basis.

“Substitute Purchaser” is defined in Section 21.

“SVO” means the Securities Valuation Office of the NAIC or any successor to such Office.

“Taxable REIT Subsidiary” has the meaning given that term in Section 856(1) of the Code.

“Total Asset Value” means the sum of all of the following of Xxxxxx REIT on a consolidated basis determined in accordance with GAAP applied on a consistent basis:

(a) cash and Cash Equivalents, plus

(b) for Properties owned for more than four fiscal quarters and not valued pursuant to clauses (c) through (f) of this definition below, the sum of (1) the quotient of NOI of such Properties, if other than Studio Properties, for the most recent two fiscal quarters annualized, divided by the applicable Capitalization Rate, plus (2) the quotient of NOI of such Properties,

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if Studio Properties, for the most recent four fiscal quarters, divided by the applicable Capitalization Rate, plus

(d) the GAAP book value of Construction-in-Progress (including land, improvements, indirect costs internally allocated, pre-development costs and development costs), plus

(e) the GAAP book value of all Renovation Properties, plus

(f) the GAAP book value of Unimproved Land, plus

(g) an amount equal to the aggregate book value of Mortgage Receivables.

For avoidance of doubt, no single Property may be valued under more than one of the above clauses at any given time. Xxxxxx REIT’s Ownership Share of assets held by Unconsolidated Affiliates (excluding assets of the type described in the immediately preceding clause (a)) will be included in Total Asset Value calculations consistent with the above described treatment for wholly owned assets.

In no event shall a Property valued pursuant to clause (b) of this definition above be less than zero.

For purposes of calculating the Total Asset Value of any Property that is not Construction-in-Progress or a Renovation Property, but that was Construction-in-Progress or a Renovation Property, as applicable, at any time during the previous two full fiscal quarters, the NOI attributable to such Property for purposes of making the calculation in clause (b) of this definition above shall be calculated as follows:

(i) until one full fiscal quarter has elapsed since such Property ceased being Construction-in-Progress or a Renovation Property, as applicable, the NOI attributable to (A) if such Property achieved Development Completion or Renovation Completion, as applicable, during the first month of the previous fiscal quarter, the NOI attributable to the last two months while such Property was Construction-in-Progress or a Renovation Property, as applicable, shall be annualized and (B) otherwise, the last full fiscal quarter while such Property was Construction-in-Progress or a Renovation Property, as applicable, shall be annualized; and

(ii) after one full fiscal quarter has elapsed since such Property ceased being Construction-in-Progress or a Renovation Property, as applicable, but before two full fiscal quarters have elapsed since such Property ceased being Construction-in-Progress or a Renovation Property, as applicable, the NOI of the sum of (A) the NOI attributable to the

A-22

last full fiscal quarter while such Property was Construction-in-Progress or a Renovation Property, as applicable, and (B) the NOI attributable to the first full fiscal quarter after the Property ceased being Construction-in-Progress or a Renovation Property, as applicable, shall be annualized.

For purposes of calculating the Total Asset Value, value attributable to investments in the following types of assets in excess of the applicable percentage specified below shall be excluded from the calculation of Total Asset Value:

(a) Mortgages in favor of Xxxxxx REIT, the Company, or any Subsidiary, such that the aggregate book value of Indebtedness secured by such Mortgages exceeds 10% of Total Asset Value;

(b) the aggregate amount of Construction-in-Progress in which Xxxxxx REIT either has a direct or indirect ownership interest such that the aggregate amount thereof exceeds 15% of Total Asset Value. If Construction-in-Progress is owned by an Unconsolidated Affiliate of Xxxxxx REIT, then the product of (1) Xxxxxx REIT’s Ownership Share in such Unconsolidated Affiliate and (2) the amount of Construction-in-Progress, shall be used in calculating such Total Asset Value limitation;

(c) unimproved real estate (which shall include raw land, valued at current book value) such that the aggregate book value of all such unimproved real estate exceeds 5% of Total Asset Value;

(d) Investments in Properties (other than Mortgages) that are not Office Properties or Studio Properties (provided that Investments for purposes of this clause (d) shall not include retail associated with Properties which are primarily Office Properties or Studio Properties) such that the aggregate value in such Investments exceeds 10% of Total Asset Value;

(e) common stock, Preferred Equity, other capital stock, beneficial interest in trust, membership interest in limited liability companies and other equity interests in Persons (other than consolidated Subsidiaries and Unconsolidated Affiliates), such that the aggregate value of such interests calculated on the basis of the lower of cost or market exceeds 10% of Total Asset Value;

(f) Investments in Unconsolidated Affiliates, such that the aggregate value of such Investments (determined in accordance with GAAP) in Unconsolidated Affiliates exceeds 15% of Total Asset Value; and

(g) Investments in Studio Properties, such that the aggregate value of such Investments in Studio Properties exceeds 20% of Total Asset Value.

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In addition to the foregoing limitations, the value attributable to investments in the types of assets specified in clauses (a), (b), (c), (d) and (e) in this definition above, in the aggregate, in excess of 25% shall be excluded from the calculation of Total Asset Value.

“Total Liabilities” means all Indebtedness of Xxxxxx REIT and its Subsidiaries on a consolidated basis and Xxxxxx REIT’s Ownership Share of all Indebtedness of its Unconsolidated Affiliates, other than intercompany Indebtedness owed to Xxxxxx REIT and its Subsidiaries.

“UCC” means the Uniform Commercial Code as in effect in any applicable jurisdiction.

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

“Unencumbered Asset Value” means without duplication, the sum of the following:

(a) For each Unencumbered Pool Property owned for the most recently ended four fiscal quarters, the quotient of (1) Unencumbered NOI attributable to such Unencumbered Pool Property (i) if other than a Studio Property, for the most recently ended two fiscal quarters annualized, and (ii) if a Studio Property, for the most recently ended four fiscal quarters, divided by (2) the Capitalization Rate, plus

(b) For each Unencumbered Pool Property acquired within the last four fiscal quarters, the acquisition cost of such Unencumbered Pool Property.

Notwithstanding the above, (A) to the extent that the Unencumbered Asset Value attributable to Unencumbered Pool Properties subject to Ground Leases exceeds 30% of total Unencumbered Asset Value (provided that the Metro Park Ground Lease shall not be taken into account when calculating such 30% limitation), such excess shall be excluded from Unencumbered Asset Value; and (B) to the extent that the aggregate rental revenue of the Unencumbered Pool Properties generated from a single tenant or Affiliated tenants in the aggregate exceeds 25%, in each such case, such excess shall be excluded when determining Unencumbered NOI for the purposes of calculating Unencumbered Asset Value. In no event shall a Property valued pursuant to clause (a) of this definition above be less than zero.

“Unencumbered NOI” means, for any period the aggregate NOI from the Unencumbered Pool Properties and all other unencumbered assets for the most recent two fiscal quarters annualized. To the extent that an Unencumbered Pool Property has been owned for at least one month, but not for a full fiscal quarter, the NOI from that Property for such period of ownership will be annualized.

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If the Property has not been owned for one full month, NOI shall be based on a pro forma NOI approved by the Required Holders, provided that any pro forma NOI approved by the administrative agents under each Material Credit Facility shall be deemed to be approved by the Required Holders. Xxxxxx REIT’s Ownership Share of NOI from unencumbered assets held by its Unconsolidated Affiliates will be included in Unencumbered NOI calculations consistent with the above described treatment for NOI from Unencumbered Pool Properties.

“Unencumbered Pool” means, as of any date of determination, (a) each Eligible Property, plus (b) any Property approved by the Required Holders in writing for inclusion in the Unencumbered Pool as of such date, minus (c) any Eligible Property or portion thereof that is otherwise excluded from the “unencumbered pool” under any Material Credit Facility as of such date.

“Unencumbered Pool Property” means a Property then included in the Unencumbered Pool.

“Unimproved Land” means land on which no development (other than improvements that are not material and are temporary in nature) has occurred and for which no development is scheduled in the immediately following 12 months.

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

“Unsecured Interest Expense” means, for a given period, all Interest Expense attributable to Unsecured Indebtedness of Xxxxxx REIT and its Subsidiaries, on a consolidated basis, and Xxxxxx REIT’s Ownership Share of Unsecured Indebtedness of its Unconsolidated Affiliates, in each case for such period. For the purpose of this definition, Interest Expense will be based on actual Unsecured Interest Expense.

“USA PATRIOT Act” means United States Public Law 107-56, Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT ACT) Act of 2001, as amended from time to time, and the rules and regulations promulgated thereunder from time to time in effect.

“U.S. Economic Sanctions” is defined in Section 5.16(a).

“Wholly-Owned Subsidiary” means, at any time, any Subsidiary all of the equity interests (except directors’ qualifying shares) and voting interests of which are owned by any one or more of the Company and the Company’s other Wholly-Owned Subsidiaries at such time.

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FORM OF SERIES D GUARANTEED SENIOR NOTE

XXXXXX PACIFIC PROPERTIES, L.P.

3.98% SERIES D GUARANTEED SENIOR NOTE DUE JULY 6, 2026

No. RD-_____ ________ __, 20__

$_______ PPN 44409# AA9

FOR VALUE RECEIVED, the undersigned, XXXXXX PACIFIC PROPERTIES, L.P. (herein called the “Company”), a limited partnership organized and existing under the laws of the State of Maryland, hereby promises to pay to ____________, or registered assigns, the principal sum of _____________________ DOLLARS (or so much thereof as shall not have been prepaid) on July 6, 2026 (the “Maturity Date”), with interest (computed on the basis of a 360-day year of twelve 30‑day months) (a) on the unpaid balance hereof at the rate of 3.98% per annum from the date hereof, payable semiannually, on the sixth day of January and July in each year, commencing with the January 6 or July 6 next succeeding the date hereof, and on the Maturity Date, until the principal hereof shall have become due and payable, and (b) to the extent permitted by law, (1) on any overdue payment of interest and (2) during the continuance of an Event of Default, on such unpaid balance and on any overdue payment of any Make-Whole Amount, at a rate per annum from time to time equal to the greater of (i) 5.98% or (ii) 2.00% over the rate of interest publicly announced by Xxxxx Fargo Bank, National Association from time to time in New York, New York as its “base” or “prime” rate, payable semiannually as aforesaid (or, at the option of the registered holder hereof, on demand).

Payments of principal of, interest on and any Make-Whole Amount with respect to this Note are to be made in lawful money of the United States of America at the principal office of Xxxxx Fargo Bank, National Association in New York, New York or at such other place as the Company shall have designated by written notice to the holder of this Note as provided in the Note Purchase Agreement referred to below.

This Note is one of a series of Senior Notes (herein called the “Notes”) issued pursuant to the Note Purchase Agreement, dated as of July 6, 2016 (as from time to time amended, the “Note Purchase Agreement”), between the Company and the respective Purchasers named therein and is entitled to the benefits thereof. Each holder of this Note will be deemed, by its acceptance hereof, to have (i) agreed to the confidentiality provisions set forth in Section 20 of the Note Purchase Agreement and (ii) made the representation set forth in Section 6.2 of the Note Purchase Agreement.

SCHEDULE 1(a)
(to Note Purchase Agreement)

Unless otherwise indicated, capitalized terms used in this Note shall have the respective meanings ascribed to such terms in the Note Purchase Agreement.

This Note is a registered Note and, as provided in the Note Purchase Agreement, upon surrender of this Note for registration of transfer accompanied by a written instrument of transfer duly executed, by the registered holder hereof or such holder’s attorney duly authorized in writing, a new Note for a like principal amount will be issued to, and registered in the name of, the transferee. Prior to due presentment for registration of transfer, the Company may treat the Person in whose name this Note is registered as the owner hereof for the purpose of receiving payment and for all other purposes, and the Company will not be affected by any notice to the contrary.

This Note is subject to optional prepayment, in whole or from time to time in part, at the times and on the terms specified in the Note Purchase Agreement, but not otherwise.

If an Event of Default occurs and is continuing, the principal of this Note may be declared or otherwise become due and payable in the manner, at the price (including any applicable Make-Whole Amount) and with the effect provided in the Note Purchase Agreement.

This Note shall be construed and enforced in accordance with, and the rights of the Company and the holder of this Note shall be governed by, the law of the State of New York excluding choice-of-law principles of the law of such State that would permit the application of the laws of a jurisdiction other than such State.

XXXXXX PACIFIC PROPERTIES, L.P.

By: Xxxxxx Pacific Properties, Inc.,
its general partner

By ____________________________

Its_________________________

1(a)-2

FORM OF SERIES E GUARANTEED SENIOR NOTE

XXXXXX PACIFIC PROPERTIES, L.P.

3.66% SERIES E GUARANTEED SENIOR NOTE DUE SEPTEMBER 15, 2023

No. RE-_____ ________ __, 20__

$_______ PPN 44409# AB7

FOR VALUE RECEIVED, the undersigned, XXXXXX PACIFIC PROPERTIES, L.P. (herein called the “Company”), a limited partnership organized and existing under the laws of the State of Maryland, hereby promises to pay to ____________, or registered assigns, the principal sum of _____________________ DOLLARS (or so much thereof as shall not have been prepaid) on September 15, 2023 (the “Maturity Date”), with interest (computed on the basis of a 360-day year of twelve 30‑day months) (a) on the unpaid balance hereof at the rate of 3.66% per annum from the date hereof, payable semiannually, on the fifteenth day of March and September in each year, commencing with the March 15 or September 15 next succeeding the date hereof, and on the Maturity Date, until the principal hereof shall have become due and payable, and (b) to the extent permitted by law, (1) on any overdue payment of interest and (2) during the continuance of an Event of Default, on such unpaid balance and on any overdue payment of any Make-Whole Amount, at a rate per annum from time to time equal to the greater of (i) 5.66% or (ii) 2.00% over the rate of interest publicly announced by Xxxxx Fargo Bank, National Association from time to time in New York, New York as its “base” or “prime” rate, payable semiannually as aforesaid (or, at the option of the registered holder hereof, on demand).

SCHEDULE 1(b)
(to Note Purchase Agreement)

Unless otherwise indicated, capitalized terms used in this Note shall have the respective meanings ascribed to such terms in the Note Purchase Agreement.

This Note is subject to optional prepayment, in whole or from time to time in part, at the times and on the terms specified in the Note Purchase Agreement, but not otherwise.

XXXXXX PACIFIC PROPERTIES, L.P.

By: Xxxxxx Pacific Properties, Inc.,
its general partner

By _________________________

Its______________________

1(b)-2

FORM OF OPINION OF SPECIAL COUNSEL
TO XXXXXX REIT AND THE COMPANY

(See Attached)

SCHEDULE 4.4(a)(1)
(to Note Purchase Agreement)

FORM OF OPINION OF SPECIAL MARYLAND COUNSEL
TO XXXXXX REIT AND THE COMPANY

(See Attached)

SCHEDULE 4.4(a)(2)
(to Note Purchase Agreement)

FORM OF OPINION OF SPECIAL COUNSEL
TO THE PURCHASERS

The closing opinion of Xxxxxx Xxxxxx LLP, special counsel to the Purchasers, called for by Section 4.4(b) of the Agreement, shall be dated the date of such Closing and addressed to the Purchasers, shall be satisfactory in form and substance to the Purchasers and shall be to the effect that:

1. The Issuer is a limited partnership in good standing under the laws of the State of Maryland.

2. Xxxxxx REIT is a corporation in good standing under the laws of the State of Maryland.

3. The Agreement and the Notes being delivered on the date hereof constitute the legal, valid and binding contracts of the Issuer enforceable against the Issuer in accordance with their respective terms.

4. The Parent Guaranty constitutes the legal, valid and binding contract of

Xxxxxx REIT enforceable against Xxxxxx REIT in accordance with its terms.

5. The issuance, sale and delivery of the Notes being delivered on the date hereof under the circumstances contemplated by this Agreement do not, under existing law, require the registration of such Notes under the Securities Act or the qualification of an indenture under the Trust Indenture Act of 1939.

The opinion of Xxxxxx Xxxxxx LLP shall also state that the opinions of Xxxxxx & Xxxxxxx

LLP and Xxxxxxx LLP are satisfactory in scope and form to Xxxxxx Xxxxxx LLP and that, in its opinion, the Purchasers are justified in relying thereon.

The opinion of Xxxxxx Xxxxxx LLP is limited to the laws of the State of New York and the federal laws of the United States.

With respect to matters of fact upon which such opinion is based, Xxxxxx Xxxxxx LLP may rely on appropriate certificates of public officials and officers of the Issuer and Xxxxxx REIT and upon representations of the Issuer and Xxxxxx REIT and the Purchasers delivered in connection with the issuance and sale of the Notes.

SCHEDULE 4.4(b)
(to Note Purchase Agreement)

DISCLOSURE MATERIALS


1.	Investor Presentation dated June 2016.


2.	Xxxxxx Pacific Properties, Inc. Earthquake Insurance Summary (“HPP PML Executive Summary 6-16-16”).


3.	11601 Wilshire Ground Lease Abstract.

SCHEDULE 5.3
(to Note Purchase Agreement)

SUBSIDIARIES OF XXXXXX REIT AND OWNERSHIP OF SUBSIDIARY STOCK

Part I: Subsidiaries of the Company and Ownership of Subsidiary Stock

(a) Ownership



Entity	Jurisdiction	Ownership
HCTD, LLC	Delaware	100% Xxxxxx Pacific Services, Inc.
HFOP City Plaza, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Street Associates LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 604 Arizona, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 275 Xxxxxxx, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 9300 Xxxxxx, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 6922 Hollywood, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 222 Kearny, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 901 Market, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 1455 GP, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 1455 Market, LP	Delaware	• 55% Xxxxxx Pacific Properties, L.P. • 100% Non-Economic GP Interest, Xxxxxx 1455 GP, LLC
Xxxxxx 0000 Xxxxxx Xxxxxx, LLC	Delaware	• 100% Non-Director Voting Common and 65% Director Voting Preferred, Xxxxxx 1455 Market, L.P. • 35% Director Voting Preferred, Xxxxxx 1455 GP, LLC
Xxxxxx 1861 Xxxxx, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 6040 Sunset, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 10900 Washington, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 10950 Washington, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 9300 Wilshire, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx OP Management, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Capital, LLC	California	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Del Amo Office, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx First Financial Plaza, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Pacific Services, Inc.	Maryland	100% Xxxxxx Pacific Properties, L.P.

SCHEDULE 5.4
(to Note Purchase Agreement)



Entity	Jurisdiction	Ownership
Xxxxxx Media and Entertainment Management, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Xxxxxx Center, LLC	Delaware	100% Xxxxxx Center Commercial, LLC
Xxxxxx Tierrasanta, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Center Commercial, LLC	Delaware	100% Xxxxxx Pacific Properties, L.P.
Sunset Xxxxxxx Entertainment Properties, LLC	Delaware	100% Sunset Studio Holdings, LLC
Sunset Xxxxxxx Services, LLC	Delaware	100% Xxxxxx Pacific Services, Inc.
Sunset Xxxxx Entertainment Properties, LLC	Delaware	100% Xxxxxx Pacific Properties, L.P.
Sunset Xxxxx Services, LLC	Delaware	100% Xxxxxx Pacific Services, Inc.
Sunset Studios Holdings, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Met Park North, LLC	Delaware	100% Xxxxxx Pacific Properties, L.P.
Combined/Xxxxxx 9300 Xxxxxx, LLC	Delaware	92.5% Xxxxxx 9300 Xxxxxx, LLC
Xxxxxx XX, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx MC Partners, LLC	Delaware	65% Xxxxxx XX, LLC
P1 Xxxxxx MC, Partners, LLC	Delaware	100% Xxxxxx MC Partners, LLC
P2 Xxxxxx MC Partners, LLC	Delaware	100% Xxxxxx MC Partners, LLC
Xxxxxx 3402 Pico, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Element LA, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Northview, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 625 Second, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx First & King, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 3401 Exposition, LLC	Delaware	100% Xxxxxx Pacific Properties, L.P.
Xxxxxx Xxxxxxx Place, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 000 X. Xxxxxxxx Participation, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 12655 Jefferson, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Palo Alto Square, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 0000 Xxxxxxxx Xxxxxx, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Embarcadero Place, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Foothill Research Center, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Page Mill Center, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Clocktower Square, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 0000 Xxxxxx Xxxxx, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 2180 Sand Hill Road, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Towers at Shore Center, LLC	Delaware	100% Xxxxxx Pacific Properties, L.P.

S-5.4-2



Entity	Jurisdiction	Ownership
Xxxxxx Skyway Landing, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Shorebreeze, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 555 Twin Dolphin Plaza, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 333 Twin Dolphin Plaza, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Bayhill Office Center, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Peninsula Office Park, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Bay Park Plaza, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Metro Center, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx One Bay Plaza, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Concourse, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Gateway Place, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Metro Plaza, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 1740 Technology, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Skyport Plaza, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Skyport Plaza Land, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Techmart Commerce Center, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Xxxxxxx Xxxxx Drive, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Campus Center, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx Campus Center Land, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 4th and Traction, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 405 Mateo, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 0000 0^xx Xxxxx, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 11601 Wilshire, LLC	Delaware	100% Xxxxxx Pacific Properties, X.X.
Xxxxxx 0000 Xxxxxxxxx Xxx, LLC	Delaware	21.4% Xxxxxx Pacific Properties, L.P.

(b) Relevant Agreements with respect to the Company’s Subsidiaries.

None.

S-5.4-3

Part II: Company Affiliates other than Subsidiaries

None.

Part III: Directors and Senior Officers of the Company and Xxxxxx REIT

Directors of Xxxxxx REIT

Xxxxxx X. Xxxxxxx

Xxxxxxxx X. Xxxxxxxxx

Xxxxx Xxxxx

Xxxxxxx X. Xxxxx

Xxxxxxxx X. Xxxxxx

Xxxxxx X. Xxxxxx XX

Xxxx X. Xxxxxxx

Xxxxxx X. Xxxxx, Xx.

Xxxxxxx X. Xxxx

Xxxxx X. Xxxxxx

Officers of Xxxxxx REIT



Name		Title

Xxxxxx X. Xxxxxxx	Chief Executive Officer and President
Xxxx X. Lammas	Chief Operating Officer, Chief Financial Officer and Treasurer
Xxx X. Xxxxxxx	General Counsel and Secretary

Directors of the Company

None.

Officers of the Company

None.

S-5.4-4

S-5.4-5

FINANCIAL STATEMENTS


1.	Annual Report for Xxxxxx Pacific Properties, Inc. and Xxxxxx Pacific Properties, L.P. on Form 10-K for the year ended December 31, 2010.


2.	Annual Report for Xxxxxx Pacific Properties, Inc. and Xxxxxx Pacific Properties, L.P. on Form 10-K for the year ended December 31, 2011.


3.	Annual Report for Xxxxxx Pacific Properties, Inc. and Xxxxxx Pacific Properties, L.P. on Form 10-K for the year ended December 31, 2012.


4.	Annual Report for Xxxxxx Pacific Properties, Inc. and Xxxxxx Pacific Properties, L.P. on Form 10-K for the year ended December 31, 2013.


5.	Annual Report for Xxxxxx Pacific Properties, Inc. and Xxxxxx Pacific Properties, L.P. on Form 10-K for the year ended December 31, 2014.


6.	Annual Report for Xxxxxx Pacific Properties, Inc. and Xxxxxx Pacific Properties, L.P. on Form 10-K for the year ended December 31, 2015.


7.	Quarterly Report for Xxxxxx Pacific Properties, Inc. and Xxxxxx Pacific Properties, L.P. on Form 10-Q for the three months ended March 31, 2016.

SCHEDULE 5.5
(to Note Purchase Agreement)

PROPERTIES; LIENS

Part I: List of Properties, Occupancy, Construction/Renovation Status, Eligible and Unencumbered Pool Properties, Ground Leases,

(as of the Execution Date)



PROPERTY NAME	ADDRESS	PERCENT OCCUPIED	FEE AND/OR LEASEHOLD OWNER	ELIGIBLE PROPERTY	UNENCUMBERED POOL PROPERTY	GROUND LEASE
Met Park North	0000 Xxxxxx Xxxxxx, Xxxxxxx, XX 00000 (King County)	95.7%	Xxxxxx Met Park North, LLC			N/A
Northview	00000 00^xx Xxxxxx Xxxx, Xxxxxxx, XX 00000 (Snohomish County)	87.7%	Xxxxxx Northview, LLC	X	X	N/A
Xxxxxxx Place	000 Xxxxx Xxxxxx Xxxxx, Xxxxxxx, XX 00000 (King County)	77.0%	Xxxxxx Xxxxxxx Place, LLC	X	X	N/A
000 Xxxxx Xxxxxx Xxxxx	000 Xxxxx Xxxxxx Xxxxx, Xxxxxxx, XX 00000 (King County)	96.9%	Xxxxxx First & King, LLC	X	X	N/A
00 Xxxx Xxxxxx	00 Xxxxx Xxxx Xxxxxx, Xxxxxxx, XX, 00000 (King County)	86.4%	Xxxxxx First & King, LLC	X	X	N/A
0000 Xxxxxx Xxxxxx	0000 Xxxxxx Xxxxxx, Xxx Xxxxxxxxx, XX 00000 (San Francisco County)	96.4%	Xxxxxx 1455 GP, LLC Xxxxxx 1455 Market, XX Xxxxxx 1455 Market, LLC			N/A
000 Xxxxxx Xxxxxx and 000 Xxxxxx Xxxxxx	000-000 Xxxxxx Xxxxxx, Xxx Xxxxxxxxx, XX 00000 and 000 Xxxxxx Xxxxxx, Xxx Xxxxxxxxx, XX 00000 (San Francisco County )	84.4%	Xxxxxx 222 Kearny, LLC	X	X	Expires 6/14/2054 (partial ground lease)
275 Xxxxxxx	000 Xxxxxxx Xxxxxx, Xxx Xxxxxxxxx, XX 00000 (San Francisco County)	100.0%	Xxxxxx 275 Xxxxxxx, LLC	X	X	N/A
000 Xxxxxx Xxxxxx	000 Xxxxxx Xxxxxx, Xxx Xxxxxxxxx, XX 00000 (San Francisco County)	73.8%	Xxxxxx 625 Second, LLC	X	X	N/A
000 Xxxxxx Xxxxxx	875 & 000 Xxxxxx Xxxxxx, Xxx Xxxxxxxxx, XX 00000 (San Francisco County)	99.0%	Xxxxxx Street Associates LLC	X	X	N/A

SCHEDULE 5.10(a)
(to Note Purchase Agreement)



PROPERTY NAME	ADDRESS	PERCENT OCCUPIED	FEE AND/OR LEASEHOLD OWNER	ELIGIBLE PROPERTY	UNENCUMBERED POOL PROPERTY	GROUND LEASE
Xxxxxx Center	000 Xxxxx Xxxxxx, Xxx Xxxxxxxxx, XX 00000 (San Francisco County)	85.9%	Xxxxxx Center Commercial, LLC Xxxxxx Xxxxxx Center, LLC			N/A
Pinnacle I	0000 Xxxx Xxxxx Xxxxxx, Xxxxxxx, XX 00000 (Los Angeles County)	86.2%	Xxxxxx XX, LLC Xxxxxx MC Partners, LLC P1 Xxxxxx MC Partners, LLC			N/A
Pinnacle II	0000 Xxxx Xxxxx Xxxxxx, Xxxxxxx, XX 00000 (Los Angeles County)	100.0%	Xxxxxx XX, LLC Xxxxxx MC Partners, LLC P2 Xxxxxx MC Partners, LLC			N/A
0000 Xxxxxxxxx Xxxxxxxxx	0000 Xxxxxxxxx Xxxxxxxxx, Xxxxxxxxx, XX 00000 (Los Angeles County)	86.1%	Xxxxxx 6922 Hollywood, LLC	X	X	N/A
Technicolor Building	6040 & 0000 Xxxx Xxxxxx Xxxxxxxxx, Xxxxxxxxx, XX 00000 (Los Angeles County)	100.0%	Xxxxxx 6040 Sunset, LLC	X	X	N/A
Del Amo Office Building	0000 Xxxxxxxxx Xxxxxxxxx, Xxxxxxxx, XX 00000 (Los Angeles County)	100.0%	Xxxxxx Del Amo Office, LLC			Expires 6/30/2049
0000 Xxxxxxxxxx Xxxxxxxxx	0000 Xxxxxxxxxx Xxxxxxxxx, Xxxxx Xxxxxx, XX 00000 (Los Angeles County)	100.0%	Xxxxxx 3401 Exposition, LLC	X	X	N/A
10900 Washington	00000 Xxxxxxxxxx Xxxxxxxxx, Xxxxxx Xxxx, XX 00000 (Los Angeles County)	100.0%	Xxxxxx 10900 Washington, LLC	X	X	N/A
10950 Washington	00000 Xxxx Xxxxxxxxxx Xxxxxxxxx, Xxxxxx Xxxx, XX 00000 (Los Angeles County)	100.0%	Xxxxxx 10950 Washington, LLC			N/A

S-5.10(a)-2



PROPERTY NAME	ADDRESS	PERCENT OCCUPIED	FEE AND/OR LEASEHOLD OWNER	ELIGIBLE PROPERTY	UNENCUMBERED POOL PROPERTY	GROUND LEASE
000 Xxxxxxx Xxxxxx	000 Xxxxxxx Xxxxxx, Xxxxx Xxxxxx, XX 00000 (Los Angeles County)	100.0%	Xxxxxx 604 Arizona, LLC	X	X	N/A
9300 Wilshire	0000 Xxxxxxxx Xxxxxxxxx, Xxxxxxx Xxxxx, XX 00000 (Los Angeles County)	89.3%	Xxxxxx 9300 Wilshire, LLC			Expires 8/14/2032
3400 Hillview	0000 Xxxxxxxx Xxxxxx, Xxxx Xxxx, XX 00000 (Santa Xxxxx County)	100.0%	Xxxxxx 0000 Xxxxxxxx Xxxxxx, LLC	X	X	Expires 10/31/2040
Xxxxxxxxxx Xxxxxx	000, 000, 630 & 000 Xxxxxx Xxx, Xxxx Xxxx, XX 00000 (Santa Xxxxx County)	96.9%	Xxxxxx Clocktower Square, LLC	X	X	Expires 9/26/2056
Foothill Research Center	4001, 4005, 4009 & 0000 Xxxxxxx Xxxxxx, Xxxx Xxxx, XX 00000 (Santa Xxxxx County)	100.0%	Xxxxxx Foothill Research Center, LLC	X	X	Expires 6/30/2039
Lockheed	0000 Xxxxxx Xxxxx, Xxxx Xxxx, XX 00000 (Santa Xxxxx County)	100.0%	Xxxxxx 0000 Xxxxxx Xxxxx, LLC	X	X	Expires 7/31/2040
0000 Xxxx Xxxx Xxxx	0000 Xxxx Xxxx Xxxx, Xxxxx Xxxx, XX 00000 (San Mateo County)	97.2%	Xxxxxx 0000 Xxxx Xxxx Xxxx, LLC	X	X	N/A
Embarcadero Place	2100, 2200, 2300 & 0000 Xxxx Xxxx, Xxxx Xxxx, XX 00000 (Santa Xxxxx County)	98.8%	Xxxxxx Embarcadero Place, LLC	X	X	N/A
Towers at Shore Center	201, 203 & 000 Xxxxxxx Xxxxxx Xxxxxxx, Xxxxxxx Xxxx, XX 00000 (San Mateo County)	89.7%	Xxxxxx Towers at Shore Center, LLC	X	X	N/A
Skyway Landing	955, 959 & 000 Xxxxxx Xxxx, Xxx Xxxxxx, XX 00000 (San Mateo County)	92.7%	Xxxxxx Skyway Landing, LLC	X	X	N/A
000 Xxxxxx Xxxxxx	000 Xxxxxx Xxxxxx, Xxx Xxxxxxxxx, XX 00000 (San Francisco County)	100.0%	Xxxxxx 000 Xxxxxx Xxxxxx, LLC	X	X	N/A
1740 Technology	0000 Xxxxxxxxxx Xxxxx, Xxx Xxxx, XX 00000 (Santa Xxxxx County)	99.1%	Xxxxxx 1740 Technology, LLC	X	X	N/A

S-5.10(a)-3



PROPERTY NAME	ADDRESS	PERCENT OCCUPIED	FEE AND/OR LEASEHOLD OWNER	ELIGIBLE PROPERTY	UNENCUMBERED POOL PROPERTY	GROUND LEASE
The Concourse	224 & 000 Xxxxxxx Xxxxxxx and 1731, 1735, 1741, 1745, 1757 & 0000 Xxxxxxxxxx Xxxxx, Xxx Xxxx, XX 00000 (Santa Xxxxx County)	94.7%	Xxxxxx Concourse, LLC	X	X	N/A
Skyport Plaza	1602, 1650, 1652 & 0000 Xxxxxxxxxx Xxxxx and 50 & 00 Xxxxxxx Xxxxx, Xxx Xxxx, XX 00000 (Santa Xxxxx County)	98.7%	Xxxxxx Skyport Plaza, LLC	X	X	N/A
Campus Center (Office)	115, 135 & 000 Xxxxx XxXxxxxx Xxxxxxxxx, Xxxxxxxx, XX 00000 (Santa Xxxxx County)	100.0%	Xxxxxx Xxxxxx Xxxxxx, XXX	X	X	X/X
Xxxxxxx XX	00000 Olympic Boulevard and 1861, 1901, 1925 & 0000 Xxxxx Xxxxx Xxxxx, Xxx Xxxxxxx, XX 00000 (Los Angeles County)	100.0%	Xxxxxx Element LA, LLC Xxxxxx 1861 Bundy, LLC			N/A
Metro Center	919, 939, 977 & 000 Xxxx Xxxxxxxxx Xxxxxxxxx and 000 Xxxxx Xxxx, Xxxxxx Xxxx, XX 00000 (San Mateo County)	57.5%	Xxxxxx Metro Center, LLC	X	X	Expires 4/29/2054
Page Mill Center	1500, 1510, 1520 & 0000 Xxxx Xxxx Xxxx, Xxxx Xxxx, XX 00000 (Santa Xxxxx County)	87.2%	Xxxxxx Page Mill Center, LLC	X	X	Expires 11/30/2041
Palo Alto Square	0000 Xx Xxxxxx Xxxx, Xxxx Xxxx, XX 00000 (Santa Xxxxx County)	86.6%	Xxxxxx Palo Alto Square, LLC	X	X	Expires 3/15/2045
000 Xxxx Xxxxxxx Xxxxx	000 Xxxx Xxxxxxx Xxxxx, Xxxxxxx Xxxx, XX 00000 (San Mateo County)	73.3%	Xxxxxx 333 Twin Dolphin Plaza, LLC	X	X	N/A
000 Xxxx Xxxxxxx Xxxxx	000 Xxxx Xxxxxxx Xxxxx, Xxxxxxx Xxxx, XX 00000 (San Mateo County)	89.7%	Xxxxxx 000 Xxxx Xxxxxxx Xxxxx	X	X	X/X

X-0.00(x)-0



PROPERTY NAME	ADDRESS	PERCENT OCCUPIED	FEE AND/OR LEASEHOLD OWNER	ELIGIBLE PROPERTY	UNENCUMBERED POOL PROPERTY	GROUND LEASE
Shorebreeze	000 & 000 Xxxxxxxxx Xxxxx, Xxxxxxx Xxxx, XX 00000 (San Mateo County)	70.8%	Xxxxxx Shorebreeze, LLC	X	X	N/A
Gateway Office	2001, 2005, 2033, 2045, 2055, 2077 & 0000 Xxxxxxx Xxxxx, Xxx Xxxx, XX 00000 (Santa Xxxxx County)	83.8%	Xxxxxx Xxxxxxx Xxxxx, XXX	X	X	X/X
Xxxxx Xxxxx	25, 101 & 000 Xxxxx Xxxxx, Xxx Xxxx, XX 00000 (Santa Xxxxx County)	82.6%	Xxxxxx Metro Plaza, LLC	X	X	N/A
Peninsula Office Park	2600, 2655, 2755, 2800, 2929, 2955 & 0000 Xxxxxx Xxxxx, Xxx Xxxxx, XX 00000 (San Mateo County)	81.6%	Xxxxxx Peninsula Office Park, LLC	X	X	N/A
Techmart Commerce Center	0000 Xxxxx Xxxxxxx Xxxxxxx, Xxxxx Xxxxx, XX 00000 (Santa Xxxxx County)	78.6%	Xxxxxx Techmart Commerce Center, LLC	X	X	Expires 5/31/2053
Sunset Xxxxx Studios	0000 X. Xxxxx Xxxxxx, Xxxxxxxxx, XX 00000 0000 Xxxxxx Xxxxxxxxx, Xxxxxxxxx, XX 00000 (Los Angeles County)	82.1%	Sunset Xxxxx Entertainment Properties, LLC			Expires 3/31/2060 (partial ground lease)
Sunset Xxxxxxx Studios	0000 Xxxxxx Xxxxxxxxx., Xxxxxxxxx, XX 00000 (Los Angeles County)	80.6%	Sunset Studios Holdings, LLC Sunset Xxxxxxx Entertainment Properties, LLC			N/A
REDEVELOPMENT
Xxxxxxx Place Theatre Building (Renovation Property)	00 Xxxxx Xxxxxxx Xxxxxx, Xxxxxxx, XX 00000 (King County)	0%	Xxxxxx Xxxxxxx Place, LLC	X	X	N/A

S-5.10(a)-5



PROPERTY NAME	ADDRESS	PERCENT OCCUPIED	FEE AND/OR LEASEHOLD OWNER	ELIGIBLE PROPERTY	UNENCUMBERED POOL PROPERTY	GROUND LEASE
000 Xxxxxx Xxxxxx (0^xx Xxxxx) (Renovation Property)	000 & 000 Xxxxxx Xxxxxx, Xxx Xxxxxxxxx, XX 00000 (San Francisco County)	0%	Xxxxxx Street Associates LLC	X	X	N/A
00000 Xxxxxxxxx Xxxxxxxxx (Renovation Property)	00000 Xxxxxxxxx Xxxxxxxxx, Xxx Xxxxxxx, XX 00000 (Los Angeles County)	0%	Xxxxxx 12655 Xxxxxxxxx, LLC	X	X	N/A
0000 Xxxx Xxxxxxxxx - Existing Office (Renovation Property)	0000 Xxxx Xxxxxxxxx, Xxxxx Xxxxxx, XX 00000 (Los Angeles County)	0%	Xxxxxx 3402 Pico, LLC	X	X	N/A
4th & Traction (Renovation Property)	000 Xxxx 0xx Xxxxxx, Xxx Xxxxxxx, XX 00000 (Los Angeles County)	0.0%	Xxxxxx 4th & Traction, LLC	X	X	N/A
0000 0xx Xxxxx (Renovation Property)	0000 Xxxx 0xx Xxxxx, Xxx Xxxxxxx, XX 00000 (Los Angeles County)	0.0%	Xxxxxx 0000 0xx Xxxxx, LLC	X	X	N/A
405 Mateo (Renovation Property)	000 Xxxxx, Xxx Xxxxxxx, XX 00000 (Los Angeles County)	0%	Xxxxxx 405 Mateo, LLC	X	X	N/A
DEVELOPMENT
Xxxxxxx Place - 000 Xxxxxxx Xxx (Construction-in-Progress)	000 Xxxxxxx Xxx, Xxxxxxx, XX 00000 (King County)	0%	Xxxxxx Xxxxxxx Place, LLC			N/A

S-5.10(a)-6



PROPERTY NAME	ADDRESS	PERCENT OCCUPIED	FEE AND/OR LEASEHOLD OWNER	ELIGIBLE PROPERTY	UNENCUMBERED POOL PROPERTY	GROUND LEASE
ICON (Construction-in- Progress)	0000 Xxxxxx Xxxxxxxxx, Xxxxxxxxx, XX 00000 (Los Angeles County)	0%	Sunset Xxxxxxx Entertainment Properties, LLC			N/A
LAND PROPERTIES
Xxxxxxx Xxxxx - Xxxx	0000, 1650, 1652 & 0000 Xxxxxxxxxx Xxxxx and 50 & 00 Xxxxxxx Xxxxx, Xxx Xxxx, XX 00000 (Santa Xxxxx County)	0%	Xxxxxx Skyport Plaza Land, LLC			X/X
Xxxxxx Xxxxxx - Xxxx	000, 135 & 000 Xxxxx XxXxxxxx Xxxxxxxxx, Xxxxxxxx, XX 00000 (Santa Xxxxx County)	0%	Xxxxxx Campus Center Land, LLC			N/A
Sunset Xxxxxxx – Lot A	0000 Xxxxxx Xxxxxxxxx, Xxxxxxxxx, XX 00000 (Los Angeles County)	0%	Sunset Studios Holdings, LLC Sunset Xxxxxxx Entertainment Properties, LLC			N/A
Sunset Xxxxxxx -Lot D	0000 Xxxxxx Xxxxxxxxx, Xxxxxxxxx, XX 00000 (Los Angeles County)	0%	Sunset Studios Holdings, LLC Sunset Xxxxxxx Entertainment Properties, LLC			N/A
Sunset Xxxxx - Redevelopment	0000 X. Xxxxx Xxxxxx, Xxxxxxxxx, XX 00000 0000 Xxxxxx Xxxxxxxxx, Xxxxxxxxx, XX 00000 (Los Angeles County)	0%	Sunset Xxxxx Entertainment Properties, LLC			X/X
Xxxxxxx XX	00000 Olympic Boulevard and 1861, 1901, 1925 & 0000 Xxxxx Xxxxx Xxxxx, Xxx Xxxxxxx, XX 00000 (Los Angeles County)	0%	Xxxxxx Element LA, LLC Xxxxxx 1861 Xxxxx, LLC			N/A

S-5.10(a)-7



PROPERTY NAME	ADDRESS	PERCENT OCCUPIED	FEE AND/OR LEASEHOLD OWNER	ELIGIBLE PROPERTY	UNENCUMBERED POOL PROPERTY	GROUND LEASE
0000 Xxxx Xxxxxxxxx – Future Xxxxxx	0000 Xxxx Xxxxxxxxx, Xxxxx Xxxxxx, XX 00000 (Los Angeles County)	0%	Xxxxxx 3402 Pico, LLC			N/A
0000 Xxxx Xxxxxxxxx – Residential	0000 Xxxx Xxxxxxxxx, Xxxxx Xxxxxx, XX 00000 (Los Angeles County)	0%	Xxxxxx 3402 Pico, LLC			N/A

S-5.10(a)-8

EXISTING INDEBTEDNESS

(As of the March 31, 2016)



Obligation	Collateral	Outstanding Balance	Guarantees	Obligor	Obligee or Agent of Obligee
Second Amended and Restated Credit Agreement dated as of March 31, 2015, among the Company, various financial institutions and Xxxxx Fargo Bank, National Association, as administrative agent.	None.	$50,000,000 of Revolving Loan $900,000,000 of Term Loan	Guaranty by Xxxxxx REIT.	Xxxxxx Pacific Properties, X.X.	Xxxxx Fargo Bank
Term Loan Credit Agreement dated as of November 17, 2015, among the Company, various financial institutions and Xxxxx Fargo Bank, National Association, as administrative agent.	None	$0	Payment and Performance Guaranty by Xxxxxx REIT.	Xxxxxx Pacific Properties, X.X.	Xxxxx Fargo Bank
Series A Notes – 4.35% Interest	None	$110,000,000	Parent Guaranty by Xxxxxx REIT.	Xxxxxx Pacific Properties, L.P.	MetLife, HIMCO, USAA, Pacific Life, American Family
Series B Notes – 4.69% Interest	None	$259,000,000	Parent Guaranty by Xxxxxx REIT.	Xxxxxx Pacific Properties, L.P.	MetLife, USAA, Pacific Life, American Family, New York Life
Series C Notes – 4.79% Interest	None	$56,000,000	Parent Guaranty by Xxxxxx REIT.	Xxxxxx Pacific Properties, L.P.	MetLife, HIMCO
Mortgage loan secured by Sunset Xxxxx Entertainment Properties, LLC and Sunset Xxxxxxx Entertainment Properties, LLC	Sunset Xxxxx 0000 X. Xxxxx Xxxxxx Xxxxxxxxx, XX 90028 (Los Angeles County) Sunset Bronson 5800 Sunset Blvd. Hollywood, CA 90028 (Los Angeles County)	$115,001,000	Partial Payment & Carve-Out Guaranty.	Sunset Xxxxx Entertainment Properties, LLC and Sunset Xxxxxxx Entertainment Properties, LLC	Xxxxx Fargo Bank

SCHEDULE 5.15
(to Note Purchase Agreement)



Obligation	Collateral	Outstanding Balance	Guarantees	Obligor	Obligee or Agent of Obligee
Mortgage loan secured by Xxxxxx Xxxxxx Center, LLC	000 Xxxxx Xxxxxx Xxx Xxxxxxxxx, XX 00000 (Xxx Xxxxxxxxx Xxxxxx)	$101,836,000	Transfer Tax Indemnity Letter.	Xxxxxx Xxxxxx Center, LLC	PNC Bank/Midland Loan
Mortgage loan secured by Xxxxxx 901 Market, LLC	000 Xxxxxx Xxxxxx Xxx Xxxxxxxxx, XX 00000 (Xxx Xxxxxxxxx Xxxxxx)	$30,000,000	Partial Payment & Completion Guarantee	Xxxxxx 000 Xxxxxx Xxxxxx, LLC	Xxxxx Fargo Bank
Mortgage loan secured by Xxxxxx 10950 Washington, LLC	10912 & 00000 Xxxx Xxxxxxxxxx Xxxx. Xxxxxx Xxxx, XX 00000 (Xxx Angeles County)	$28,288,000	None.	Xxxxxx 10950 Washington, LLC	Xxxxx Fargo Bank
Mortgage loan secured by P1 Xxxxxx MC Partners, LLC (Pinnacle I)	0000 Xxxx Xxxxx Xxxxxx Xxxxxxx XX 91505 (Los Angeles County)	$129,000,000	None.	P1 Xxxxxx MC Partners, LLC	Xxxxx Fargo Bank
Mortgage loan secured by P2 Xxxxxx MC Partners, LLC (Pinnacle II)	0000 Xxxx Xxxxx Xxxxxx Xxxxxxx, XX 91505 (Los Angeles County)	$85,914,000	Guaranty by Xxxxxx MC Partners, LLC	P2 Xxxxxx MC Partners, LLC	Xxxxx Fargo Bank
Mortgage loan secured by Xxxxxx Met Park North, LLC	0000 Xxxxxx Xxxxxx Xxxxxxx, XX 98101 (King County)	$64,500,000	None.	Xxxxxx Met Park North, LLC	Union Bank
Mortgage loan secured by Xxxxxx Element LA, LLC	1861, 1901, 1925 & 0000 Xxxxx Xxxxx Xxxxx 00000 X. Xxxxxxx Xxxx. Xxx Xxxxxxx, Xxxxxxxxxx 00000	$168,000,000	None.	Xxxxxx Element LA, LLC	Berkeley

S-5.15-2

INFORMATION RELATING TO PURCHASERS



	Name and Address of Purchaser	Principal Amount of Notes to be Purchased
	[NAME OF PURCHASER]	$
(1)	All payments by wire transfer of immediately available funds to: with sufficient information to identify the source and application of such funds.
(2)	All notices of payments and written confirmations of such wire transfers:
(3)	E-mail address for Electronic Delivery:

(4) All other communications:

SCHEDULE B
(to Note Purchase Agreement)

FORM OF PARENT GUARANTY

EXHIBIT PG
(to Note Purchase Agreement)

FORM OF SUBSIDIARY GUARANTY

47891-0000

CH2\18361350.9

EXHIBIT SG
(to Note Purchase Agreement)

Document Metadata

Table of Contents

HUDSON PACIFIC PROPERTIES, L.P. 3.98% Series D Guaranteed Senior Notes due July 6, 2026 3.66% Series E Guaranteed Senior Notes due September 15, 2023 NOTE PURCHASE AGREEMENT Dated as of July 6, 2016

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