Defeasance Agreement Letter

DEFEASANCE AGREEMENT LETTER

This Defeasance Agreement Letter (the Agreement) is made as of Effective Date: by and between Lender: , and Borrower: .

RECITALS

WHEREAS, Borrower is the obligor under that certain loan, mortgage, indenture or other financing instrument described as: (Loan), which is secured by certain collateral and related security documents;

WHEREAS, Borrower has requested that Lender permit a defeasance of the Loan in accordance with the terms set forth herein and with the intention that, upon satisfaction of the conditions in this Agreement, the Loan obligations will be deemed discharged or effectively secured by substitute assets as described herein; and

WHEREAS, Lender is willing to consent to such defeasance on the terms and subject to the conditions set forth in this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants set forth below, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

1. DEFINITIONS

1.1 "Defeasance Date" means the date on which the conditions precedent set forth in Section 6 have been satisfied and Lender has delivered written acknowledgment of defeasance.

1.2 "Defeasance Securities" means the government or investment-grade securities, cash, or other permitted instruments to be deposited and held in escrow or trust for the sole purpose of paying scheduled principal and interest under the Loan, as described in Section 2.

2. DEFEASANCE PROCEDURE

2.1 Subject to the terms of this Agreement, upon receipt and acceptance by Lender of the Defeasance Securities and any required cash deposits, and upon satisfaction of the Conditions Precedent, Lender shall instruct the trustee or servicer under the Loan documents to apply such Defeasance Securities to satisfy, in whole or in part, the scheduled payment obligations in accordance with the payment schedule identified in the escrow instructions.

2.2 Borrower shall deliver to Lender, concurrently with execution of this Agreement, the documents and instruments specified herein, including without limitation, executed escrow instructions, an irrevocable transfer of Defeasance Securities, and any certificates of incumbency, authority and opinion of counsel reasonably requested by Lender.

3. RELEASE AND DISCHARGE

3.1 Upon the occurrence of the Defeasance Date and so long as the Defeasance Securities are held and applied in accordance with this Agreement and the escrow instructions, Lender agrees that, to the extent provided in the Loan documents, the Loan shall be released and Borrower shall be released from the payment obligations secured by the released collateral, subject to the terms of this Agreement and any continuing obligations expressly retained by Lender.

3.2 Notwithstanding anything to the contrary, any obligations expressly stated in the Loan documents to survive termination will continue in full force and effect, and this Agreement shall not operate to impair any security interest or lien that is expressly intended to survive defeasance under the Loan documents.

4. REPRESENTATIONS AND WARRANTIES

Borrower represents and warrants to Lender that: (a) Borrower is duly organized and validly existing under the laws of the jurisdiction of its organization and has the power and authority to enter into this Agreement; (b) the execution, delivery and performance of this Agreement have been duly authorized by all necessary corporate or other action; (c) upon delivery in accordance with this Agreement, the Defeasance Securities will be free and clear of all liens, claims and encumbrances other than those created by this Agreement and the escrow instructions; and (d) no event of default has occurred under the Loan documents that would permit acceleration or enforcement by Lender, except as disclosed in writing to Lender.

5. COVENANTS

Borrower covenants that, from the date hereof until the Defeasance Date, Borrower shall (a) provide timely and accurate documentation and certificates reasonably requested by Lender; (b) not transfer or permit liens on the Defeasance Securities; and (c) cause the Defeasance Securities to be invested, held and applied only in the manner set forth in the escrow instructions and this Agreement.

6. CONDITIONS PRECEDENT

6.1 Lender's obligations hereunder are conditioned upon receipt, in form and substance satisfactory to Lender, of: (a) executed escrow instructions; (b) title and lien releases or subordination agreements, if applicable; (c) opinions of counsel for Borrower customary for defeasance transactions; and (d) payment by Borrower of all fees, costs and expenses owing to Lender and the trustee in connection with the defeasance.

6.2 Lender may in its reasonable discretion waive any condition precedent in whole or in part, provided such waiver is in writing.

7. INDEMNITY

Borrower shall indemnify, defend and hold harmless Lender and its officers, directors, agents and employees from and against any and all claims, losses, liabilities, damages, costs and expenses (including reasonable attorneys' fees) arising out of or relating to Borrower's breach of any representation, warranty or covenant in this Agreement or the failure to deliver Defeasance Securities in accordance with this Agreement, except to the extent resulting from Lender's gross negligence or willful misconduct.

8. NOTICES

All notices, demands and other communications required or permitted under this Agreement shall be in writing and delivered as set forth below. Notices shall be deemed given when personally delivered, sent by nationally recognized overnight courier, or three business days after deposit in the mail, first-class certified or registered, postage prepaid, addressed as follows:

9. DEFAULT; REMEDIES

In the event Borrower fails to satisfy the obligations required for defeasance or otherwise defaults under this Agreement, Lender shall have all remedies available under the Loan documents and at law or in equity. Nothing in this Agreement shall limit Lender's right to pursue any remedies for defaults that arise prior to or after the Defeasance Date, except as expressly provided in this Agreement.

10. GOVERNING LAW

This Agreement shall be governed by and construed in accordance with the laws of the State specified below without regard to conflicts of law principles. The parties submit to the exclusive jurisdiction of the courts located in that State for any dispute arising under this Agreement.

11. ENTIRE AGREEMENT; SEVERABILITY

This Agreement, together with the escrow instructions and the Loan documents to the extent expressly incorporated herein, constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior negotiations and agreements. If any provision of this Agreement is determined to be invalid or unenforceable, such determination shall not affect the remaining provisions, which shall remain in full force and effect.

12. AMENDMENTS; WAIVER; COUNTERPARTS

Any amendment or waiver of any provision of this Agreement must be in writing and signed by the party against whom enforcement is sought. No waiver shall constitute a waiver of any other breach. This Agreement may be executed in counterparts, each of which shall be an original and all of which together shall constitute one instrument. Delivery by facsimile or electronic image of an executed counterpart shall be effective as delivery of an original.

13. MISCELLANEOUS

The headings in this Agreement are for convenience only and shall not affect the construction or interpretation of any provision. All representations, warranties and covenants contained in this Agreement shall survive the Defeasance Date to the extent necessary to enforce the rights and obligations set forth herein.

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