8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  October 15, 2008

Franklin Street Properties Corp.

(Exact name of registrant as specified in its charter)

Maryland	001-32470	04-3578653
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

401 Edgewater Place, Suite 200, Wakefield, Massachusetts	01880-6210
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code:  (781) 557-1300

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement.

On October 15, 2008 (the “Term Loan Closing Date”), Franklin Street Properties Corp. (the “Company”), certain wholly-owned subsidiaries of the Company, RBS Citizens, National Association (“Citizens”), Bank of America, N.A. and Wachovia Bank, National Association (together with Citizens, the “Term Loan Lenders”) entered into that certain Term Loan Agreement (the “Term Loan Agreement”) to provide for a $75,000,000.00 (the “Term Loan Amount”) unsecured term loan facility (the “Term Loan”).  The proceeds of the Term Loan will be used to pay down a portion of the outstanding balance on the Company’s existing $250,000,000.00 revolving line of credit facility (the “Revolver Loan”) by and among the Company, certain wholly-owned subsidiaries of the Company, the Term Loan Lenders and Chevy Chase Bank, F.S.B. (collectively, the “Revolver Loan Lenders”).  The Company intends to use the increased availability under the Revolver Loan for property acquisitions.  Borrowings made under the Term Loan Agreement bear interest at a rate based either on Citizens’ prime rate or on a LIBOR rate, as determined by the Company at the time of borrowing.  Amounts outstanding under the Term Loan Agreement may not be prepaid at any time in whole or in part during the first year.  Thereafter, amounts outstanding under the Term Loan Agreement may be prepaid at any time in whole or in part without premium or penalty, with limited exceptions.  The Term Loan Agreement contains customary representations and warranties, as well as customary events of default and affirmative covenants. In addition, there are customary negative covenants, including financial covenants and covenants relating to liens, investments, indebtedness, fundamental changes, dispositions, and dividends and distributions. The Term Loan Agreement terminates and any outstanding amounts under it mature on October 15, 2011 (the “Initial Term Loan Maturity Date”).  The Company has the right to extend the Initial Term Loan Maturity Date for up to two successive one-year periods upon payment of an extension fee and satisfaction of the other terms and conditions described in the Term Loan Agreement.  Interest only is due on amounts outstanding under the Term Loan until the second anniversary of the Term Loan Closing Date.  Thereafter, the Term Loan Agreement requires monthly payments of principal and interest following a 30-year loan amortization schedule.  On the Initial Term Loan Maturity Date (as such date may be extended), all accrued interest, principal and other charges shall be due and payable in full.

Although the interest rate options under the Term Loan Agreement are variable, under the Term Loan Agreement the Company is required to fix the interest rate through the Initial Term Loan Maturity Date by entering into an interest rate swap agreement with Citizens.  If the Company elects to exercise one or more of its one-year extension periods, the Company may, in its discretion, enter into one or more interest rate swap agreements for either or both extension periods.  Accordingly, on the Term Loan Closing Date, the Company entered into an ISDA Master Agreement (together with the schedule and swap transaction relating thereto, the “ISDA Master Agreement”) with Citizens that fixes the interest rate on the Term Loan through the Initial Term Loan Maturity Date at 5.84% per annum.

On the Term Loan Closing Date, the Company, certain wholly-owned subsidiaries of the Company and the Revolver Loan Lenders entered into a First Amendment to Third Amended and Restated Loan Agreement (the “Revolver Loan Amendment”).  The Revolver Loan Amendment amends the Third Amended and Restated Loan Agreement dated October 19, 2007 by and among the Company, certain wholly-owned subsidiaries of the Company and the Revolver Loan Lenders that evidences the Revolver Loan.  More specifically, the Revolver Loan Amendment, among other items, amends certain financial covenants and other terms and conditions in the Revolver Loan Agreement to conform them to the Term Loan Agreement.

The Term Loan Agreement, the ISDA Master Agreement and the Revolver Loan Amendment are attached to this Current Report on Form 8-K as Exhibit 10.1, Exhibit 10.2 and Exhibit 10.3, respectively, and are incorporated herein by reference. The foregoing summaries of the Term Loan Agreement, the ISDA Master Agreement and the Revolver Loan Amendment are qualified in their entirety by the complete text of the Term Loan Agreement, the ISDA Master Agreement and the Revolver Loan Amendment filed herewith.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The information contained above under Item 1.01 is incorporated herein by reference.

Item 7.01 Regulation FD Disclosure

On October 15, 2008, the Company issued a press release announcing the closing of the Term Loan.  A copy of this press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

The information in this Item 7.01 and Exhibit 99.1 attached hereto is intended to be furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.

Item 9.01 Financial Statements and Exhibits.

(d)           Exhibits.

See Exhibit Index attached hereto.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	FRANKLIN STREET PROPERTIES CORP.
Date:  October 15, 2008	By:      /s/ George J. Carter
	George J. Carter President and Chief Executive Officer

EXHIBIT INDEX

Exhibit No.	Description
10.1	Term Loan Agreement, dated as of October 15, 2008, by and among Franklin Street Properties Corp., certain of its wholly-owned subsidiaries, RBS Citizens, National Association, Wachovia Bank, National Association and other lenders which may become parties thereto from time to time.
10.2	ISDA Master Agreement, dated as of October 15, 2008, by and between Franklin Street Properties Corp. and RBS Citizents, National Association, together with the schedule relating thereto.
10.3	First Amendment to Third Amended and Restated Loan Agreement, dated as of October 15, 2008, by and among Franklin Street Properties Corp., certain of its wholly-owned subsidiaries, RBS Citizens, National Association, Bank of America, N.A., Chevy Chase Bank, F.S.B. and  Wachovia Bank, National Association.
99.1	Press Release issued by Franklin Street Properties Corp. on October 15, 2008.

EX-10.1

Exhibit 10.1

TERM LOAN AGREEMENT

among

FRANKLIN STREET PROPERTIES CORP.

FSP HOLDINGS LLC

FSP INVESTMENTS LLC

FSP PROPERTY MANAGEMENT LLC

FSP PROTECTIVE TRS CORP.

FSP HILLVIEW CENTER LIMITED PARTNERSHIP

FSP MONTAGUE BUSINESS CENTER CORP.

FSP GREENWOOD PLAZA CORP.

FSP 380 INTERLOCKEN CORP.

FSP 390 INTERLOCKEN LLC

FSP BLUE LAGOON DRIVE LLC

FSP ONE OVERTON PARK LLC

FSP NORTHWEST POINT LLC

FSP RIVER CROSSING LLC

FSP BOLLMAN PLACE LIMITED PARTNERSHIP

FSP SOUTHFIELD CENTRE LIMITED PARTNERSHIP

FSP FOREST PARK IV NC LIMITED PARTNERSHIP

FSP PARK SENECA LIMITED PARTNERSHIP

FSP ADDISON CIRCLE LIMITED PARTNERSHIP

FSP COLLINS CROSSING LIMITED PARTNERSHIP

FSP ELDRIDGE GREEN LIMITED PARTNERSHIP

FSP LIBERTY PLAZA LIMITED PARTNERSHIP

FSP PARK TEN LIMITED PARTNERSHIP

FSP WILLOW BEND OFFICE CENTER LIMITED PARTNERSHIP

FSP INNSBROOK CORP.

FSP EAST BALTIMORE STREET LLC

FSP PARK TEN PHASE II LIMITED PARTNERSHIP

and

OTHER BORROWERS WHICH MAY BECOME

PARTIES TO THIS AGREEMENT

and

RBS CITIZENS, NATIONAL ASSOCIATION (“Agent”)

BANK OF AMERICA, N.A. (“Co-Agent”)

WACHOVIA BANK, NATIONAL ASSOCIATION

and

Other Lenders, if any, which may become parties to this Agreement (with Citizens, BOA and Wachovia, the “Lenders”)

October 15, 2008

TABLE OF CONTENTS

1.	BACKGROUND	1
1.1	Definitions	1
1.2	Borrower	1
1.3	Use of Proceeds	1
1.4	Facility	1
1.5	Borrower Agent	2
2.	AGREEMENT TO MAKE LOAN	2
2.1	Agreement to Make Term Loan	2
2.2	Intentionally Omitted	2
2.3	Purpose of Loan	2
2.4	Requests for Advances	2
2.5	Interest Rate and Payment Terms	3
2.5.1	Borrower’s Options	4
2.5.2	Selection To Be Made	4
2.5.3	Notice	4
2.5.4	Hedging Contracts	4
2.5.5	Telephonic Notice	5
2.5.6	Limits On Options	5
2.5.7	Payment and Calculation of Interest	5
2.5.8	Principal	5
2.5.9	Prepayment	5
2.5.10	Maturity	6
2.5.11	Method of Payment; Date of Credit	6
2.5.12	Billings	6
2.5.13	Default Rate	6
2.5.14	Late Charges	6
2.5.15	Voluntary Prepayment of LIBOR Rate Loans	7
2.5.16	Make Whole Provision	8
2.6	Additional Provisions Related to Interest Rate Selection.	8
2.6.1	Increased Costs	8
2.6.2	Increased Capital Costs	9
2.6.3	Taxes	9
2.6.4	Libor Rate Lending Unlawful	10
2.6.5	Additional Libor Conditions	10
2.6.6	Variable Rate Advances	11
2.7	The Loan Account	11
2.8	Extension Rights	12
2.9	Basic Conditions for Each Extension Period	12
3.	THE NOTES	13
4.	FEES	13
5.	JOINDER DOCUMENTS	13

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6.	CONDITIONS TO CLOSING	13
6.1	Loan Documents	13
6.2	Certified Copies of Organization Documents	13
6.3	Resolutions	13
6.4	Incumbency Certificate; Authorized Signers	14
6.5	Legal Opinions	14
6.6	Intentionally Deleted	14
6.7	Performance; No Default	14
6.8	Representations and Warranties	14
6.9	Proceedings and Documents	14
6.10	Waiver	14
7.	CONDITIONS TO ALL BORROWINGS	15
7.1	Representations True; No Event of Default	15
7.2	No Legal Impediment	15
7.3	Governmental Regulation	15
7.4	Proceedings and Documents	15
8.	REPRESENTATIONS, WARRANTIES AND COVENANTS	15
8.1	Organization; Authority, Etc	15
8.2	Title to Asset	16
8.3	Financial Statements	16
8.4	No Material Changes, Etc	17
8.5	Franchises, Patents, Copyrights, Etc	17
8.6	Litigation	17
8.7	No Materially Adverse Contracts, Etc	17
8.8	Compliance With Other Instruments, Laws, Etc	18
8.9	Tax Status	18
8.10	No Event of Default	18
8.11	Setoff, Etc	18
8.12	Certain Transactions	18
8.13	Subsidiaries	19
8.14	Intentionally Deleted	19
8.15	ERISA Plan	19
8.16	Solvency	19
8.17	The Unencumbered Pool Properties	19
8.18	No Broker or Finder	23
8.19	General	23
8.20	Representations, Warranties, Covenants and Agreements with Respect to the Unencumbered Pool Properties	23
9.	AFFIRMATIVE COVENANTS OF THE BORROWER	23
9.1	Punctual Payment	23
9.2	Financial Statements, Certificates and Information	24
9.3	Insurance	25
9.4	Liens and Other Charges	25

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9.5	Inspection of Unencumbered Pool Properties and Books	25
9.6	Compliance with Laws, Contracts, Licenses, and Permits	26
9.7	Use of Proceeds	26
9.8	Publicity	26
9.9	Further Assurances	26
9.10	Notices	26
9.11	Other Affirmative Covenants	27
9.12	Control of Borrower	27
9.13	Wholly Owned Subsidiary	27
9.14	Maintenance of Borrower’s Properties	27
9.15	Acquisitions, Dispositions and Syndication of Borrower’s Assets	28
9.16	Business Activities	28
10.	NEGATIVE COVENANTS OF THE BORROWER	28
10.1	No Amendments, Terminations or Waivers	28
10.2	Restrictions on Indebtedness	28
10.3	Restrictions on Liens, Etc	29
10.4	Restrictions on Loans and Investments	29
10.5	Merger, Consolidation, Conversion, Business Operations, and Ownership and Disposition of Assets	30
10.6	Sale and Leaseback	31
10.7	Distributions	31
10.8	Financial Covenants	31
10.9	Other Negative Covenants	32
11.	EVENTS OF DEFAULT AND REMEDIES	33
11.1	Events of Default	33
11.2	Termination of Advances and Acceleration	35
11.3	Other Remedies	36
11.4	Distribution of Proceeds	36
11.5	Power of Attorney	37
11.6	Waivers	37
12.	SETOFF	37
13.	EXPENSES	38
14.	INDEMNIFICATION	38
15.	LIABILITY OF THE AGENT AND THE LENDERS	39
16.	RIGHTS OF THIRD PARTIES	39
17.	SURVIVAL OF COVENANTS, ETC	40

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18.	THE AGENT AND THE LENDERS	40
18.1	Appointment of Agent	40
18.2	Administration of Loan by Agent	40
18.3	Delegation of Duties	41
18.4	Exculpatory Provisions	41
18.5	Reliance by Agent	42
18.6	Notice of Default	42
18.7	Lenders’ Credit Decisions	42
18.8	Agent’s Reimbursement and Indemnification	43
18.9	Agent in its Individual Capacity	43
18.10	Successor Agent	43
18.11	Duties in the Case of Enforcement	44
18.12	Respecting Loans and Payments	44
18.12.1	Procedures for Loans	44
18.12.2	Nature of Obligations of Lenders	45
18.12.3	Payments to Agent	45
18.12.4	Distribution of Liquidation Proceeds	45
18.12.5	Adjustments	46
18.12.6	Setoff	46
18.12.7	Distribution by Agent	47
18.13	Delinquent Lender	47
18.14	Holders	48
18.15	Assignment and Participation	48
18.15.1	Conditions to Assignment by Lenders	48
18.15.2	Certain Representations and Warranties, Limitations, Covenants	48
18.15.3	Register	50
18.15.4	New Notes	50
18.15.5	Participations	50
18.16	Disclosure	51
18.17	Miscellaneous Assignment Provisions	52
18.18	Amendment, Waiver, Consent, Etc	52
18.19	Deemed Consent or Approval	53
19.	NO ASSIGNMENT BY THE BORROWER	53
20.	RELATIONSHIP	53
21.	NOTICES	54
22.	GOVERNING LAW	56
23.	CONSENT TO JURISDICTION; WAIVERS	56
24.	PREFERENCES	56
25.	RULES OF INTERPRETATION	57

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26.	HEADINGS	58
27.	COUNTERPARTS	58
28.	ENTIRE AGREEMENT	58
29.	TIME OF THE ESSENCE	58
30.	SEVERABILITY	58
31.	CUSTOMER IDENTIFICATION - USA PATRIOT ACT NOTICE; OFAC AND BANK SECRECY ACT	58

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EXHIBITS

Exhibit A – Joinder Agreement

Exhibit E – Assignment and Acceptance

Exhibit F – Lenders’ Commitment

Exhibit H - Unencumbered Pool Properties

vi

SCHEDULES

Schedule 1 - Definitions

Schedule 2 – List of Borrowers

Schedule 3 – Loan Request Form

Schedule 4 - Subsidiaries

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TERM LOAN AGREEMENT

This Term Loan Agreement (the “Loan Agreement”) is made as of the 15th day of October, 2008, by and among FRANKLIN STREET PROPERTIES CORP. (“FSP”) with a principal place of business at 401 Edgewater Place, Suite 200, Wakefield, Massachusetts 01880-6210 and the Wholly Owned Subsidiaries that are listed on Schedule 2 attached hereto (which Schedule 2 may be amended from time to time in accordance with the terms hereof) (collectively, the “Borrower”) organized under the laws of the states noted therein, and RBS CITIZENS, NATIONAL ASSOCIATION, with a place of business at 28 State Street, Boston, Massachusetts 02109, BANK OF AMERICA, N.A., WACHOVIA BANK, NATIONAL ASSOCIATION, and the other lending institutions which may become parties to this Agreement pursuant to Section 18.15 hereof (the “Lenders”) and RBS CITIZENS, NATIONAL ASSOCIATION as agent for itself and such other lending institutions (the “Agent”).

1.           BACKGROUND

1.1           Definitions.  This Agreement and other Loan Documents utilize various defined terms which shall have the meanings set forth in Schedule 1 attached to this Agreement or, if separately defined elsewhere herein or in any other Loan Documents, as set forth in such separate definitions.  Unless otherwise specified in the Loan Documents, the definitions contained in this Agreement shall supercede any inconsistent definitions contained in the Note or any other Loan Document and in the event of any inconsistencies between this Agreement, the Note or any other Loan Document, this Agreement shall control.

1.2           Borrower.  Each entity comprising the Borrower as of the date hereof is as described on Schedule 2 and organized under the laws of the states noted therein.  Schedule 2 shall be deemed updated (a) with respect to any Acquisitions of individual properties by a Wholly Owned Subsidiary, to include any such Wholly Owned Subsidiary at the time any such Wholly Owned Subsidiary executes and delivers Joinder Documents to the Agent pursuant to Section 5 hereof, and (b) with respect to any disposition of individual properties by any Wholly Owned Subsidiary, to exclude such Wholly Owned Subsidiary at the time Borrower delivers the notice and certification described in Section 9.15 hereof.

1.3           Use of Proceeds.  Borrower has applied to Lenders to establish a term facility in the maximum amount of $75,000,000.00, the proceeds of which are to be used to reduce the Borrower’s outstanding balance under the Revolver Loan and/or for property acquisitions.

1.4           Facility.  Subject to all of the terms, conditions and provisions of this Loan Agreement, and of the agreements and instruments referred to herein, each of the Lenders agree severally to establish the Loan up to a maximum aggregate principal amount equal to such Lender’s Commitment and Borrower agrees to accept and repay proceeds outstanding under the Loan.

1.5           Borrower Agent.  Each Borrower hereby appoints FSP as agent for the Borrower to execute, on behalf of the Borrower, documents, instruments and agreements in connection with the Loan, including, without limitation, documents, instruments and agreements required for the administration of the Loan, receiving Loan Advances and exercising interest rate selections and to receive all notices required to be given to the Borrower under the Loan Documents, and establishing, with RBS Citizens, National Association, on the Borrower’s behalf, the various deposit accounts required by this Agreement and the depositing therein and withdrawing therefrom by FSP of amounts from time to time in accordance with the terms and conditions of the Loan Documents.  Each Borrower shall be jointly and severally obligated under the Loan and shall be bound by all actions taken by FSP in connection with the Loan.  Any Loan received by FSP shall be deemed to have been received by each Borrower.

1

2.           AGREEMENT TO MAKE LOAN

2.1           Agreement to Make Term Loan.  Subject to the terms and conditions of this Agreement and relying upon the representations and warranties contained in this Agreement and the other Loan Documents, each of the Lenders agree to lend to the Borrower up to a maximum aggregate principal amount equal to such Lender’s Commitment and the Borrower may borrow on the Closing Date the Loan Amount in its entirety; however, any Advances of proceeds of the Loan shall be made by the Lenders pro rata, in accordance with each Lender’s Commitment Percentage.  Each request for an Advance of the Loan hereunder shall constitute a representation and warranty by the Borrower that the conditions set forth in §§7 and 8 have been satisfied on the date of such request unless, and only to the extent that, any such representation and warranty relates specifically and only to an earlier date in time.  Any amounts repaid by the Borrower may not be reborrowed, and there can be no repayments for the first year of the Loan.

2.2           Intentionally Omitted

2.3           Purpose of Loan.  The Loan shall be used by the Borrower for the following purposes:  pay down the Revolver Loan and/or for property acquisitions.

2.4           Requests for Advances.

(a) The Borrower shall give to the Agent written notice in the form of Schedule 3 hereto (or telephonic notice confirmed in writing in the form of Schedule 3 hereto) of each Advance requested hereunder (a “Loan Request”) in accordance with the interest rate selection requirements set forth in Section 2.5.3.  Each such Loan Request shall specify (i) the principal amount of the Advance requested, (ii) the intended use of the proceeds of such Advance; and (iii) the proposed Drawdown Date of such Advance.  The Borrower agrees to accept the Advance requested from the Agent on the proposed Drawdown Date.  Each Advance shall be a minimum aggregate amount of $1,000,000.00 or an integral multiple of $100,000 in excess thereof.

(b) In the event that the Borrower shall receive Advance(s) in excess of the Loan Amount the Borrower shall immediately repay the Loan by an amount sufficient to reduce the outstanding principal balance to equal or less than the Loan Amount.

(c) The Agent and the Lenders may rely on any request for an Advance or financial accommodation which the Agent and the Lenders, reasonably and in good faith, believes to have been made by a person duly authorized to act on behalf of the Borrower and may decline to make any such requested Advance or to provide any such financial accommodation pending the Agent and the Lenders’ being furnished with such documentation concerning that person’s authority to act as may be satisfactory to the Agent and the Lenders.

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(d) A request by the Borrower for any Advance shall be irrevocable and shall constitute certification by the Borrower that as of the date of such request, each of the following is true and correct:

(i) There has been no material adverse change in the Borrower’s financial condition from the most recent financial information furnished the Lenders pursuant to this Agreement;

(ii) The Borrower is in compliance with, and has not breached any of, its covenants contained in this Agreement;

(iii) Each representation which is made herein or in any of the Loan Documents is then true and complete as of and as if made on the date of such request unless such representation relates specifically and only to an earlier date in time; and

(iv) No event has occurred nor failed to occur which occurrence or failure is, or with the passage of time or giving of notice (or both) would constitute an Event of Default (as described herein), whether or not the Agent and the Lenders has exercised any of its rights upon such occurrence or failure.

(e) The Borrower shall immediately become indebted to the Lenders for the amount of each Advance when such Advance is made for or on behalf of the Borrower.

2.5           Interest Rate and Payment Terms.  The Loan shall be payable as to interest and principal in accordance with the provisions of this Agreement and the Note.  This Agreement also provides for interest at a Default Rate, Late Charges and prepayment rights and fees.  All payments for the account of Lenders shall be applied to the respective accounts of the Lenders in accordance with each Lender’s Commitment Percentage of the Loan.  The Agent will disburse such payments to the Lenders on the date of receipt thereof if received prior to 10:00 a.m. on such date and, if not, on the next Business Day.  Any and all interest rate selection and conversion provisions in this Agreement are to be administered by the Agent and to be allocated on a pro rata basis to the Note held by each Lender based upon such Lender’s Commitment Percentage.

2.5.1                 Borrower’s Options.  Principal amounts outstanding under the Loan shall bear interest at the following rates, at Borrower’s selection, subject to the conditions and limitations provided for in this Agreement:  (i) Variable Rate or (ii) Adjusted Libor Rate.

2.5.2                 Selection To Be Made.  Borrower shall select and thereafter may change the selection of, the applicable interest rate, from the alternatives otherwise provided for in this Agreement, by giving Agent a Notice of Rate Selection: (i) prior to the Loan, (ii) prior to the end of each Interest Period applicable to a Libor Advance, or (iii) on any Business Day on which Borrower desires to convert an outstanding Variable Rate Advance to a Libor Advance.

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2.5.3                 Notice.  A “Notice of Rate Selection” shall be a written notice, given by cable, tested telex, telecopier (with authorized signature), or by telephone if immediately confirmed by such a written notice, from an authorized representative of Borrower which: (i) is irrevocable; (ii) is received by Agent not later than 10:00 o’clock A.M. Eastern Time: (a) if an Adjusted Libor Rate is selected, at least three (3) Business Days but not more than five (5) Business Days prior to the requested Drawdown Date or the end of the current Interest Period to which such selection is to apply or (b) if a Variable Rate is selected, on the day on which such Loan is funded; (iii) as to each selected interest rate option, sets forth the aggregate principal amount(s) to which such interest rate option(s) shall apply and the Interest Period(s) applicable to each Libor Advance; provided, however, that no portion of the outstanding principal amount of any LIBOR Advances may be converted to, or continued as, LIBOR Advances when any Event of Default has occurred and is continuing, and no portion of the outstanding principal amount of any LIBOR Advances may be converted to LIBOR Advances of a different duration if such LIBOR Advances relate to any Hedging Obligations.  In the absence of delivery of a continuation/conversion notice with respect to any LIBOR Advances at least three Business Days before the last day of the then current Interest Period with respect thereto, such LIBOR Rate Loan shall, on such last day, automatically convert to a loan that accrues interest by reference to the LIBOR Rate Loans for a thirty (30) day period.

2.5.4                 Hedging Contracts.  The Borrower shall enter into a Hedging Contract for the initial three (3) year term of the Loan.  If the Extended Term is exercised by the Borrower, the Borrower may, at its discretion, enter into one or more Hedging Contracts for either or both Extension Periods.

2.5.5                 Telephonic Notice.  Without any way limiting Borrower’s obligation to confirm in writing any telephonic notice, Agent may act without liability upon the basis of telephonic notice believed by Agent in good faith to be from Borrower prior to receipt of written confirmation.  In each case Borrower hereby waives the right to dispute Agent’s record of the terms of such telephonic Notice of Rate Selection in the absence of manifest error.

2.5.6                 Limits On Options.  One Selection Per Month.  Each Libor Advance shall be in a minimum amount of $1,000,000.  At no time shall there be outstanding a total of more than five (5) Libor Advances combined at any time.  If Borrower shall make more than one (1) Libor Rate Loan interest rate selection in any thirty (30) day period, excluding conversions of outstanding advances made at the end of an applicable Interest Period of any previously outstanding Libor Advance, Agent may impose and Borrower shall pay a reasonable processing fee for each such additional selection.  This limitation on interest rate selection shall not limit the number of Advances which may be requested by the Borrower in any thirty (30) day period.

2.5.7                 Payment and Calculation of Interest.  All interest shall be:  (a) Payable in arrears commencing November 1, 2008 and on the last day of each Libor Interest Period thereafter until the principal together with all interest and other charges payable with respect to the Loan shall be fully paid; and (b) calculated on the basis of a 360 day year and the actual number of days elapsed.  Each change in the Prime Rate shall simultaneously change the Variable Rate payable under this Agreement.  Interest at the Adjusted Libor Rate shall be computed from and including the first day of the applicable Interest Period to, but excluding, the last day thereof.

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2.5.8                 Principal.  Commencing on the date that is the end of the Libor Interest Period immediately following the second year anniversary of the date of this Agreement, and continuing on the same day of each calendar month thereafter, the Borrower shall make monthly payments of principal following  a loan amortization payment schedule over 30 years.  The entire principal balance shall be due and payable in full at the Maturity Date.

2.5.9                 Prepayment.  The Loan may not be prepaid during the first year of the Loan.  Thereafter, the Loan or any portion thereof may be prepaid in full or in part at any time upon three (3) Business Days, prior written notice to Agent without premium or penalty with respect to Variable Rate Advances and, with respect to Libor Advances subject to a Make-Whole Provision and upon payment of a LIBOR Rate Loan Prepayment Fee, if applicable.  Any partial prepayment of principal shall first be applied in accordance with the terms hereof.

2.5.10                 Maturity.  On the Maturity Date all accrued interest, principal and other charges due with respect to the Loan shall be due and payable in full and the principal balance and such other charges, but not unpaid interest, shall continue to bear interest at the Default Rate until so paid.

2.5.11                 Method of Payment; Date of Credit.  All payments of interest, principal and fees shall be made in lawful money of the United States in immediately available funds, without counterclaim or set off and free and clear, and without any deduction or withholding for, any taxes or other payments (a) by direct charge to an account of Borrower maintained with Agent (or the then holder of the Loan), or (b) by wire transfer to Agent or (c) to such other bank or address as the Agent may designate in a written notice to Borrower.  Payments shall be credited on the Business Day on which immediately available funds are received prior to 10:00 o’clock A.M. Eastern Time; payments received after ten o’clock A.M. Eastern Time shall be credited to the Loan on the next Business Day, payments which are by check, which Agent may at its option accept or reject, or which are not in the form of immediately available funds shall not be credited to the Loan until such funds become immediately available to Agent, and, with respect to payments by check, such credit shall be provisional until the item is finally paid by the payer bank.

2.5.12                 Billings.  Agent may submit monthly billings reflecting payments due; however, any changes in the interest rate which occur between the date of billing and the due date may be reflected in the billing for a subsequent month. Neither the failure of Agent to submit a billing nor any error in any such billing shall excuse Borrower from the obligation to make full payment of all Borrower’s payment obligations when due.

2.5.13                 Default Rate.  Agent shall have the option of imposing, and Borrower shall pay upon billing therefor, an interest rate which is four percent (4%) per annum above the Variable Rate (“Default Rate”):  (a) following any Event of Default, unless and until the Event of Default is cured or waived by Agent; and (b) after the Maturity Date.  Borrower’s right to select pricing options shall cease upon the occurrence and during the continuance of an Event of Default.

2.5.14                 Late Charges.  Borrower shall pay, upon billing therefor, a “Late Charge” equal to five percent (5%) of the amount of any payment of principal, other than principal due at Maturity, interest, or both, which is not paid within ten (10) days of the due date thereof.  Late charges are:  (a) payable in addition to, and not in limitation of, the Default Rate, (b) intended to compensate Agent and the Lenders for administrative and processing costs incident to late payments, (c) are not interest, and (d) shall not be subject to refund or rebate or credited against any other amount due.

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2.5.15                 Voluntary Prepayment of LIBOR Rate Loans.  LIBOR Advances may be prepaid upon the terms and conditions set forth herein.  For LIBOR Advances in connection with which the Borrower has or may incur Hedging Obligations, additional obligations may be associated with prepayment, in accordance with the terms and conditions of the applicable Hedging Contracts.   The Borrower shall give the Agent, no later than 10:00 a.m., New York City time, at least three (3) Business Days notice of any proposed prepayment of any LIBOR Advances, specifying the proposed date of payment of such LIBOR Advances, and the principal amount to be paid.  Each partial prepayment of the principal amount of LIBOR Advances shall be in an integral multiple of $100,000.00 and accompanied by the payment of all charges outstanding on such LIBOR Advances and of all accrued interest on the principal repaid to the date of payment.  Borrower acknowledges that prepayment or acceleration of a LIBOR Advance during an Interest Period shall result in the Lender incurring additional costs, expenses and/or liabilities and that it is extremely difficult and impractical to ascertain the extent of such costs, expenses and/or liabilities.  Therefore, all full or partial prepayments of LIBOR Advances shall be accompanied by, and the Borrower hereby promises to pay, on each date a LIBOR Advance is prepaid or the date all sums payable hereunder become due and payable prior to their stated maturity, by acceleration or otherwise, in addition to all other sums then owing, an amount (“LIBOR Rate Loan Prepayment Fee”) determined by the Agent pursuant to the following formula:

(a) the then current rate for United States Treasury securities (bills on a discounted basis shall be converted to a bond equivalent) with a maturity date closest to the end of the Interest Period as to which prepayment is made, subtracted from

(b) the Adjusted Libor Rate applicable to the Libor Advance being prepaid.

If the result of this calculation is zero or a negative number, then there shall be no LIBOR Rate Loan Prepayment Fee.  If the result of this calculation is a positive number, then the resulting percentage shall be multiplied by:

(c) the amount of the Libor Advance being prepaid.

The resulting amount shall be divided by:

(d) 360

and multiplied by:

(e) the number of days remaining in the Interest Period as to which the prepayment is being made.

Said amount shall be reduced to present value calculated by using the referenced United States Treasury securities rate and the number of days remaining on the Interest Period for the Libor Advance being prepaid.

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The resulting amount of these calculations shall be the LIBOR Advance Prepayment Fee.

2.5.16                 Make Whole Provision.  In addition to the LIBOR Rate Loan Prepayment Fee, the Borrower agrees to reimburse the Lenders (without duplication) for any increase in the cost to the Lenders, or reduction in the amount of any sum receivable by the Lenders, in respect, or as a result of:

(a) any conversion or repayment or prepayment of the principal amount of any Libor Advances on a date other than the scheduled last day of the Interest Period applicable thereto, whether voluntary or otherwise;

(b) any loans not being made as Libor Advances in accordance with the borrowing request thereof;

(c) any Libor Advances not being continued as, or converted into, LIBOR Advances in accordance with the continuation/conversion notice thereof, or

(d) without duplication of any costs incurred by the Borrower under any Hedging Contracts, any costs associated with marking to market any Hedging Obligations that (in the reasonable determination of the Agent unless another method of calculating costs is otherwise specified pursuant to the terms of any Hedging Contracts) are required to be terminated as a result of any conversion, repayment or prepayment of the principal amount of any LIBOR Advances on a date other than the scheduled last day of the Interest Period applicable thereto, whether voluntary or otherwise;

The Agent shall promptly notify the Borrower in writing of the occurrence of any such event, such notice to state, in reasonable detail, the reasons therefore and the additional amount required fully to compensate the Agent for such increased cost or reduced amount.  Such additional amounts shall be payable by the Borrower to the Agent within five Business Days of its receipt of such notice, and such notice shall, in the absence of manifest error, be conclusive and binding on the Borrower.  The Borrower understands, agrees and acknowledges the following: (i) the Agent does not have any obligation to purchase, sell and/or match funds in connection with the use of LIBOR Rate as a basis for calculating the rate of interest on a LIBOR Advance, (ii) the LIBOR Rate may be used merely as a reference in determining such rate, and (iii) the Borrower has accepted the LIBOR Rate as a reasonable and fair basis for calculating such rate, the LIBOR Rate Prepayment Fee, and other funding losses incurred by the Lenders.  Borrower further agrees to pay the LIBOR Rate Prepayment Fee and other funding losses, if any, whether or not the Lenders elect to purchase, sell and/or match funds.

2.6           Additional Provisions Related to Interest Rate Selection.

2.6.1                 Increased Costs.   If on or after the date hereof the adoption of any applicable law, rule or regulation or guideline (whether or not having the force of law), or any change therein, or any change in the interpretation or administration thereof by any governmental authority, central bank or comparable agency charged with the interpretation or administration thereof, or compliance by the Lenders with any request or directive (whether or not having the force of law) of any such authority, central bank or comparable agency:

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(a) shall subject the Lenders to any tax, duty or other charge with respect to its LIBOR Advances or its obligation to make LIBOR Advances, or shall change the basis of taxation of payments to the Lenders of the principal of or interest on its LIBOR Advances or any other amounts due under this agreement in respect of its LIBOR Advances or its obligation to make LIBOR Advances (except for the introduction of, or change in the rate of, tax on the overall net income of the Lenders or franchise taxes, imposed by the jurisdiction (or any political subdivision or taxing authority thereof) under the laws of which the Lenders are organized or in which the Lenders’ principal executive offices are located); or

(b) shall impose, modify or deem applicable any reserve, special deposit or similar requirement (including, without limitation, any such requirement imposed by the Board of Governors of the Federal Reserve System of the United States) against assets of, deposits with or for the account of, or credit extended by, the Lenders or shall impose on the Lenders or on the London interbank market any other condition affecting its LIBOR Advances or its obligation to make LIBOR Advances;

and the result of any of the foregoing is to increase the cost to the Lenders of making or maintaining any LIBOR Advances, or to reduce the amount of any sum received or receivable by the Lenders under this Agreement with respect thereto, by an amount reasonably deemed by the Lenders to be material, then, within 15 days after written demand by the Agent (which demand shall specify in detail the reasons for same), the Borrower shall pay to the Lenders such additional amount or amounts as will compensate the Lenders for such increased cost or reduction.

2.6.2                 Increased Capital Costs.  If any change in, or the introduction, adoption, effectiveness, interpretation, reinterpretation or phase-in of, any law or regulation, directive, guideline, decision or request (whether or not having the force of law) of any court, central bank, regulator or other governmental authority affects the amount of capital required or expected to be maintained by the Lender, and a Lender determines that the rate of return on capital as a consequence of its commitments or the loans made by the Lender is reduced to a level below that which the Lender could have achieved but for the occurrence of any such circumstance, then, in any such case upon written notice from time to time by the Lender to the Borrower, the Borrower shall promptly pay directly to the Lender additional amounts sufficient to compensate for such reduction in rate of return.  A statement of the Lenders as to any such additional amount or amounts (including calculations thereof in reasonable detail) shall, in the absence of manifest error, be conclusive and binding on the Borrower.  In determining such amount, the Lender may use any method of averaging and attribution that it shall deem applicable.

2.6.3                 Taxes.  All payments by the Borrower of principal of, and interest on, the LIBOR Advances and all other amounts payable hereunder shall be made free and clear of and without deduction for any present or future income, excise, stamp taxes and other taxes, fees, duties, withholdings or other charges of any nature whatsoever imposed by any taxing authority, but excluding franchise taxes and taxes imposed on or measured by the Lender’s net income or receipts (such non-excluded items being called “Taxes”).  In the event that any withholding or deduction from any payment to be made by the Borrower hereunder is required in respect of any Taxes pursuant to any applicable law, rule or regulation, then the Borrower will

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(a) pay directly to the relevant authority the full amount required to be so withheld or deducted;

(b) promptly forward to the Lender an official receipt or other documentation reasonably satisfactory to the Lender evidencing such payment to such authority; and

(c) pay to the Lender such additional amount or amounts as is necessary to ensure that the net amount actually received by the Lender will equal the full amount the Lender would have received had no such withholding or deduction been required.

Moreover, if any Taxes are directly asserted against the Lender with respect to any payment received by the Lender hereunder, the Lender may pay such Taxes and the Borrower will promptly pay such additional amount (including any penalties, interest or expenses) as is necessary in order that the net amount received by the Lender after the payment of such Taxes (including any Taxes on such additional amount) shall equal the amount the Lender would have received had not such Taxes been asserted.

If the Borrower fails to pay any Taxes when due to the appropriate taxing authority or fails to remit to the Lender the required receipts or other required documentary evidence, the Borrower shall indemnify the Lender for any incremental Taxes, interest or penalties that may become payable by the Lender as a result of any such failure.

2.6.4                 Libor Rate Lending Unlawful.   If the Agent shall determine (which determination shall, upon notice thereof to the Borrower be conclusive and binding on the Borrower) that the introduction of or any change in or in the interpretation of any law, rule, regulation or guideline, (whether or not having the force of law) makes it unlawful, or any central bank or other governmental authority asserts that it is unlawful, for the Lenders to make, continue or maintain any Libor Advance as, or to convert any loan into, a Libor Advance of a certain duration, the obligations of the Lenders to make, continue, maintain or convert into any such Libor Advances shall, upon such determination, forthwith be suspended until the Agent shall notify the Borrower that the circumstances causing such suspension no longer exist, and all Libor Advances of such type shall automatically convert into Variable Rate Loans at the end of the then current Interest Periods with respect thereto or sooner, if required by such law or assertion.

2.6.5                 Additional Libor Conditions.  The selection by Borrower of an Adjusted Libor Rate and the maintenance of the Loan at such rate shall be subject to the following additional terms and conditions:

(i) Substitute Rate.  If the Agent shall have determined that

(a)           US dollar deposits in the relevant amount and for the relevant Interest Period are not available to the Agent in the London interbank market;

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(b)           by reason of circumstances affecting the Agent in the London interbank, adequate means do not exist for ascertaining the Libor Rate applicable hereunder to Libor Advances of any duration, or

(c)           Libor no longer adequately reflects the Lender’s cost of funding loans,

then, upon notice from the Agent to the Borrower, the obligations of the Lenders under Section 2.5 to make or continue any loans as, or to convert any loans into, Libor Advances of such duration shall forthwith be suspended until the Agent shall notify the Borrower that the circumstances causing such suspension no longer exist.

2.6.6        Variable Rate Advances.  Each Variable Rate Advance shall continue as a Variable Rate Advance until the Maturity Date of the Loan, unless sooner converted, in whole or in part, to a Libor Advance, subject to the limitations and conditions set forth in this Agreement.

2.7           The Loan Account.

(a) An account (the “Loan Account”) shall be opened on the books of the Agent, in which Loan Account a record may be kept of all Advances made by the Lenders to the Borrower under or pursuant to this Agreement and of all payments thereon.

(b) The Agent may also keep a record (either in the Loan Account or elsewhere, as the Agent may from time to time elect) of all interest, fees, service charges, costs, expenses, and other debits owed the Agent and/or the Lenders on account of the Obligations and of all credits against such amounts so owed.

(c) All credits against the Obligations shall be conditional upon final payment to the Lender of the items giving rise to such credits.  The amount of any item credited against the Obligations which is charged back against the Lender for any reason or is not so paid shall be an Obligation and shall be added to the Loan Account, whether or not the item so charged back or not so paid is returned.

(d) Except as otherwise provided herein, all fees, service charges, costs, and expenses for which the Borrower is obligated hereunder are payable thirty (30) days after the invoice date.  The Lenders, without the request of the Borrower, may make an advance of any interest, fee, service charge, or other payment to which the Agent and/or the Lenders are entitled from the Borrower pursuant hereto and may charge the same to the Loan Account notwithstanding that such amount so advanced may result in the Loan Amount being exceeded.  Such action on the part of the Lenders shall not constitute a waiver of the Lenders’ rights under Section 2.4(b), above.  Any amount which is added to the principal balance of the Loan Account as provided in this subsection shall bear interest at the interest rate applicable from time to time to the unpaid principal balance of the Loan Account.

(e) Any statement rendered by the Agent to the Borrower concerning the Obligations shall be considered correct and accepted by the Borrower and shall be conclusively binding upon the Borrower unless the Borrower provides the Agent with written objection thereto within thirty (30) days from the mailing of such statement, which written objection shall indicate, with particularity, the reason for such objection.  The Loan Account and the Agent’s books and records concerning the loan arrangement contemplated herein and the Obligations shall be prima facie evidence of the items described therein.

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2.8           Extension Rights.  Agent and Lenders shall grant a request by Borrower to extend the Initial Maturity Date of the Note for two (2) successive one (1) year periods (each an “Extended Maturity”) until October 15, 2012 (the “First Extension Period”) and until October 15, 2013 (the “Second Extension Period”) each extension period (the “Extension Period”), upon and subject to the following terms and conditions:

2.9           Basic Conditions for Each Extension Period.  Unless otherwise agreed by Agent in writing:

(a) Borrower shall request each such extension, if at all, by written notice to Agent at least ninety (90) days prior to the next applicable Maturity Date.  Such notice may be revoked by Borrower prior to the then existing Maturity Date; provided, however, Borrower shall be obligated to reimburse Agent for any expenses incurred to date.

(b) All applicable regulatory requirements applicable to Lenders, including appraisal requirements, shall have been satisfied with respect to the extension and any costs associated therewith paid by Borrower.

(c) With respect to the Second Extension Period only, the extension to the First Extension Period shall have been satisfactorily exercised.

(d) There shall be no Default or Event of Default then existing.

(e) Not later than the Maturity Date, (A) the extension shall have been documented to Agent’s reasonable satisfaction; and (B) Borrower shall have paid to Agent a non-refundable extension fee as provided in the Fee Letter.

3.           THE NOTES.  The obligation of the Borrower to pay the Loan Amount or, if less, the aggregate unpaid principal amount of all Advances made by the Lenders hereunder plus accrued interest thereon, shall be evidenced by Notes and payable in accordance therewith.  In the event any of the Notes are lost, destroyed or mutilated at any time prior to payment in full of the indebtedness evidenced thereby, the Borrower shall execute and deliver to the applicable Lender a new note substantially in the form of the Note and the applicable Lender shall execute and deliver to Borrower an affidavit and indemnification reasonably acceptable to Borrower with respect to such lost Note.

4.           FEES.   The Borrower agrees to pay to the Agent on behalf of the Lenders such fees as agreed to by and between the Agent and the Borrower in the Fee Letter.

5.           JOINDER DOCUMENTS.  At the time of an Acquisition by a Wholly Owned Subsidiary, such Wholly Owned Subsidiary which has become an owner of a Property in connection with such Acquisition shall execute the Joinder Documents so as to become a Borrower under this Agreement and shall be added as a maker under the Note.  Upon the execution of such Joinder Documents, such entities shall be considered a “Borrower” and subject to all of the terms and conditions hereof, and shall continue to be a “Borrower” hereunder except as provided in clause (b) of Section 1.2 hereof.

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6.           CONDITIONS TO CLOSING.  The obligation of the Lenders to make the initial Loan shall be subject to the satisfaction of the following conditions precedent on or before the Closing Date.

6.1           Loan Documents.  Each of the Loan Documents and the Intercreditor Agreement shall have been duly executed and delivered by the respective parties thereto.  Each of the Loan Documents and the Intercreditor Agreement shall be in full force and effect and shall be in form and substance satisfactory to the Lenders.

6.2           Certified Copies of Organization Documents.  The Agent shall have received from the Borrower a certified copy of its Organization Documents as in effect on such date of certification, such Organizational Documents to be in form and substance reasonably satisfactory to the Lenders.

6.3           Resolutions.  All action necessary for the valid execution, delivery and performance by the Borrower of this Agreement and the other Loan Documents to which it is or is to become a party shall have been duly and effectively taken, and evidence thereof satisfactory to the Lenders shall have been provided to the Lenders.  The Agent shall have received from each such Person true copies of the resolutions authorizing the transactions described herein, each certified as of a recent date to be true and complete.

6.4           Incumbency Certificate; Authorized Signers.  The Agent shall have received from the Borrower an incumbency certificate, dated as of the Closing Date, giving the name and bearing a specimen signature of each individual who shall be authorized:  (a) to sign, in the name and on behalf of such Person each of the Loan Documents to which such Person is or is to become a party; and (b) to give notices and to take other action on its behalf under the Loan Documents.

6.5           Legal Opinions.  The Lenders shall have received a favorable opinion or opinions in form and substance satisfactory to the Agent and the Agent’s counsel, addressed to the Agent and the Lenders and dated as of the Closing Date, from counsel to the Borrower acceptable to the Agent, as to such matters as the Lender shall reasonably request, including, without limitation, the due execution and authorization of all Loan Documents and the enforceability of this Agreement and the Notes.

6.6           Intentionally Deleted.

6.7           Performance; No Default.  The Borrower shall have performed and complied with all terms and conditions herein required to be performed or complied with by it or there shall exist no Default or Event of Default.

6.8           Representations and Warranties.  Without limiting the provisions set forth in Section 8.20, the representations of warranties made by the Borrower in the Loan Documents or otherwise made by or on behalf of the Borrower in connection therewith shall be true and correct in all respects on the Closing Date unless such representations and warranties relate specifically and only to an earlier date in time.

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6.9           Proceedings and Documents.  All proceedings in connection with the transactions contemplated by this Agreement and the other Loan Documents shall be satisfactory to the Agent and the Agent’s counsel in form and substance, and the Agent shall have received all information and such counterpart originals or certified copies of such documents and such other certificates, opinions or documents as the Agent and the Agent’s counsel may reasonably require.

6.10           Waiver.   Any waiver by the Agent of any of the conditions precedent contained herein for the closing of the Loan shall not be deemed to be a waiver by the Agent of any other obligation of the Borrower hereunder.

7.           CONDITIONS TO ALL BORROWINGS.  The obligations of the Lenders to make the Loan or any Advance, whether on or after the Closing Date, shall also be subject to the satisfaction of the following conditions precedent:

7.1           Representations True; No Event of Default.  Subject to Section 8.20, each of the representations and warranties of the Borrower contained in this Agreement, the other Loan Documents or in any document or instrument delivered pursuant to or in connection with this Agreement shall be true as of the date as of which they were made and shall also be true at and as of the time of the making of such Loan, with the same effect as if made at and as of that time (except to the extent of changes resulting from transactions contemplated or permitted by this Agreement and the other Loan Documents and changes occurring in the ordinary course of business that singly or in the aggregate are not materially adverse, and except to the extent that such representations and warranties relate expressly to an earlier date) and no Default or Event of Default shall have occurred and be continuing.  The Agent on behalf of the Lenders shall have received a certificate of the Borrower signed by an authorized officer of the Borrower to such effect.

7.2           No Legal Impediment.  No change shall have occurred in any law or regulations thereunder or interpretations thereof that in the reasonable opinion of the Agent would make it illegal for the Lenders to make such Loan.

7.3           Governmental Regulation.  With respect to any Libor Advance, the Lenders shall have received such statements in substance and form reasonably satisfactory to the Lenders as the Lenders shall require for the purpose of compliance with any applicable regulations of the Comptroller of the Currency or the Board of Governors of the Federal Reserve System.

7.4           Proceedings and Documents.  All proceedings in connection with the transactions contemplated by this Agreement, the other Loan Documents and all other documents incident thereto shall be reasonably satisfactory in substance and in form to the Agent and its counsel, and the Agent and such counsel shall have received all information and such counterpart originals or certified or other copies of such documents as the Agent may reasonably request.

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8.           REPRESENTATIONS, WARRANTIES AND COVENANTS.  The Borrower represents, warrants, and covenants to the Lenders as follows:

8.1           Organization; Authority, Etc.

(a) Organization; Good Standing.  Each of the entities comprising the Borrower is a limited partnership, limited liability company, or corporation, as the case may be, duly organized under the laws of its state of organization pursuant to each Person’s respective Organizational Documents, and is, and will at all times be, validly existing and in good standing under the laws of such State.  The Borrower is, and will at all times be, duly organized and is, and will at all times be, validly existing, in good standing, and qualified to do business in each jurisdiction where required except where failure to so qualify would not have a material adverse affect on the Unencumbered Pool Properties.  Each of the entities comprising the Borrower has, and will at all times have, all requisite power to own its property and conduct its business as now conducted and as presently contemplated.

(b) Authorization.  The execution, delivery and performance of this Agreement and the other Loan Documents to which Borrower is or is to become a party and the transactions contemplated hereby and thereby (i) are within the authority of such Person, (ii) have been duly authorized by all necessary proceedings on the part of such Person, (iii) do not conflict with or result in any breach or contravention of any provision of any other agreement binding upon such Person or any provision of law, statute, rule or regulation to which such Person is subject or any judgment, order, writ, injunction, license or permit applicable to such Person, (iv) do not conflict with any provision of the Organizational Documents of such Person, and (v) do not require the approval or consent of, or filing with creditors, trustees for creditors or shareholders of, or other holders, directly or indirectly, of interests in, such Person or the approval or consent or filing with any governmental agency or authority other than those approvals or consents already obtained.

(c) Enforceability.  The execution and delivery of this Agreement and the other Loan Documents, to which each Borrower is or is to become a Person will result in valid and legally binding obligations of such Borrower enforceable against it in accordance with the respective terms and provisions hereof and thereof, except as enforceability is limited by bankruptcy, insolvency, reorganization, moratorium or other laws relating to or affecting generally the enforcement of creditors’ rights and except to the extent that availability of the remedy of specific performance or injunctive relief is subject to the discretion of the court before which any proceeding therefor may be brought.

8.2           Title to Asset.  The Borrower owns all of the assets reflected in the financial statements of the Borrower as at the Balance Sheet Date or acquired since that date free from all encumbrances except for Permitted Liens (except with respect to any 1031 Property and property and assets sold or otherwise disposed of in the ordinary course of business since that date).

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8.3           Financial Statements. There has been furnished to the Lender the Form 10-K Annual Report filed with the SEC in February 2008, which included audited financial statements for the year ended December 31, 2007 for the Borrower.  There has also been furnished to the Lender the Form 10-Q Quarterly Report filed with the SEC for the Borrower, which included unaudited financial statements for the three months ending June 30, 2008 for the Borrower.  Such filings have been prepared in accordance with generally accepted accounting principles and fairly present the financial condition of the Borrower as at the close of business on the date(s) thereof and the results of operations for the fiscal year or period then ended.  As of the date of this Agreement, there are no liabilities or contingent liabilities of the Borrower known to the officers, partners, or trustees of the Borrower which are not disclosed in said financial statements and the related notes thereto other than the Obligations, except for contingent liabilities associated with the disposition of properties in such amounts as would not reasonably be expected to have a material adverse effect on Borrower’s financial condition.

8.4           No Material Changes, Etc.  Since the Balance Sheet Date, there has occurred no materially adverse change in the financial condition or business of the Borrower other than (i) changes described in the Form 10-Q for the fiscal quarter ended June 30, 2008, and (ii) changes in the ordinary course of business that have not had any material adverse effect either individually or in the aggregate on the business or financial condition of such Borrower.

8.5           Franchises, Patents, Copyrights, Etc.  The Borrower possesses, and will at all times possess, all franchises, patents, copyrights, trademarks, trade names, licenses and permits, and rights in respect of the foregoing, adequate for the conduct of its business substantially as now conducted or as it is intended to be conducted with respect to the Unencumbered Pool Properties, without known conflict with any rights of others, except where the failure to do so would not reasonably be expected to have a material adverse effect on the Borrower taken as a whole.

8.6           Litigation.  There are no actions, suits, proceedings or investigations of any kind pending or, to Borrower’s knowledge, threatened against the Borrower before any court, tribunal or administrative agency or board or any mediator or arbitrator that, either in any case or in the aggregate, would reasonably be expected to materially and adversely affect the business, assets or financial condition of the Borrower taken as a whole, or result in any material liability not adequately covered by insurance, and for which adequate reserves are not maintained on the balance sheet of such Person, or which question the validity of this Agreement or any of the other Loan Documents, any action taken or to be taken pursuant hereto or thereto, or which will materially and adversely affect the ability of the Borrower to use and occupy any of the properties comprising the Unencumbered Pool Properties or to pay and perform the Obligations in the manner contemplated by this Agreement and the other Loan Documents.

8.7           No Materially Adverse Contracts, Etc.  The Borrower is not subject to any charter, corporate or other legal restriction, or any judgment, decree, order, rule or regulation that has or is reasonably expected in the future to have a materially adverse effect on the business, assets or financial condition of such Person.  Each Borrower is not, and will not be, a party to any contract or agreement that has or is expected to have any materially adverse effect on the business of such Person.

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8.8           Compliance With Other Instruments, Laws, Etc.  The Borrower is not, and will not at any time be, in violation of any provision of its Organizational Documents or any agreement or instrument to which it may be subject or by which it or any of its properties may be bound or any decree, order, judgment, statute, license, rule or regulation, in any of the foregoing cases in a manner that would be likely to materially and adversely affect the financial condition, properties or business of such Person.

8.9           Tax Status.  Each of the entities comprising the Borrower (a) has made or filed, and will make or file in a timely fashion, all federal and state income and all other material tax returns, reports and declarations required by any jurisdiction to which it is subject, (b) has paid, and will pay when due, all taxes and other governmental assessments and charges shown or determined to be due on such returns, reports and declarations, except those being contested in good faith and by appropriate proceedings, (c) if a partnership, limited partnership, limited liability partnership, or limited liability company, has, and will maintain, partnership tax classification under the Code, and (d) has set aside, and will at all times set aside, on its books provisions reasonably adequate for the payment of all taxes for periods subsequent to the period to which such returns, reports or declarations apply, when and to the extent required by generally accepted accounting principles.  There are no unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and the officers, partners or trustees of the Borrower know of no basis for any such claim. The Borrower has filed, and will continue to file, all of such tax returns, reports, and declarations either (i) separately from any parent or affiliate or (ii) if part of a consolidated filing, as a separate member of any such consolidated group.

8.10           No Event of Default.  No Default or Event of Default has occurred and is continuing.

8.11           Setoff, Etc.  The Lenders’ rights with respect to the repayment of the Obligations are not subject to any setoff, claims, withholdings or other defenses.

8.12           Certain Transactions.  None of (a) the officers, trustees, directors, general partners, managers, members, stockholders (except any stockholders of FSP), beneficiaries, or employees of any Borrower or Subsidiary thereof or (b) to the knowledge of the Borrower, any corporation, partnership, trust or other entity (except a Syndicated REIT) in which any such officer, trustee, director, general partner, manager, member, stockholder (except any stockholder of FSP), beneficiary, or employee has a substantial interest or is an officer, director, trustee, manager or general partner, is presently a party to any transaction with the Borrower (other than for services as employees, officers, trustees, managers and directors, other than otherwise permitted under this Agreement and other than on the same terms as would be generally available to the Borrower in an arm’s length contract or arrangement with a third party).

8.13           Subsidiaries.  As of the date hereof, the Borrower’s Subsidiaries are as set forth on Schedule 4.

8.14           Intentionally Deleted.

8.15           ERISA Plan.  The Borrower does not, and will not, maintain or contribute to an ERISA Plan under Section 412 of ERISA.

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8.16           Solvency.  Borrower, on a consolidated basis, (a) is not insolvent nor will be rendered insolvent by the Indebtedness incurred in connection with the Loan, (b) does not have unreasonably small capital with which to engage in its business, or (c) has not incurred Indebtedness beyond its ability to pay such Indebtedness as it matures. The Borrower, on a consolidated basis, has assets having a value in excess of amounts required to pay any Indebtedness.

8.17           The Unencumbered Pool Properties.  The Borrower makes the following representations and warranties, to the best of its knowledge, with respect to each individual property included in the Unencumbered Pool Properties, as of the date hereof and except as disclosed in the Borrower’s filings with the Securities and Exchange Commission:

(a) Availability of Utilities.  (i) all utility services necessary and sufficient for the use and operation of each property comprising the Unencumbered Pool Properties are presently available to the boundaries of each of the properties comprising the Unencumbered Pool Properties through dedicated public rights of way or through perpetual private easements; and (ii) the owner has obtained all material utility installations and connections required for the operation and servicing of each of the properties comprising the Unencumbered Pool Properties for its intended purposes.

(b) Access.  (i) the rights of way for all roads necessary for the utilization in all material respects of each of the properties comprising the Unencumbered Pool Properties for its intended purposes have either been acquired by the appropriate Governmental Authority or have been dedicated to public use and accepted by such Governmental Authority; (ii)  All such roads have been completed and the right to use all such roads, or suitable substitute rights of way, have been obtained; and (iii) all curb cuts, driveways and traffic signals required for the operation and use in all material respects of each of the properties comprising the Unencumbered Pool Properties are existing.

(c) Condition of Unencumbered Pool Properties.  Neither the Unencumbered Pool Properties nor any material part thereof is now damaged or injured as result of any material fire, explosion, accident, flood or other casualty, no Taking is pending or contemplated.

(d) Compliance with Requirements/Historic Status/Flood Area.  The Unencumbered Pool Properties comply with all material Requirements.  Except as disclosed in the Environmental Report, Borrower has received no written notice alleging any material non-compliance by any of the properties comprising the Unencumbered Pool Properties with any Requirements or indicating that any of the properties comprising the Unencumbered Pool Properties is located within any historic district or has, or may be, designated as any kind of historic or landmark site under applicable Requirements.  None of the properties comprising the Unencumbered Pool Properties, except for the Unencumbered Pool Property known as Blue Lagoon is located in any special flood hazard area as defined under applicable Requirements, unless such property is adequately covered by insurance.

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(e) Other Contracts.

(i) The Borrower has not made any material contract or arrangement of any kind or type whatsoever (whether oral or written, formal or informal), the performance of which by the other party thereto would reasonably be expected to give rise to a lien or encumbrance on any of the properties comprising the Unencumbered Pool Properties other than a Permitted Lien.

(ii) The Borrower has not made any material contract or arrangement of any kind or type whatsoever, with any affiliate of the Borrower, except for management agreements with FSP Property Management LLC, agreements for services of its employees, officers, trustees, managers and directors and agreements with a Syndication REIT (including without limitation agreements relating to Affiliate Dispositions) and except as otherwise permitted in this Agreement which shall be deemed approved by Lenders, unless such contract or arrangement is in writing and is (i) approved in writing in advance by the Agent, or is (ii) on the same terms as would be generally available to the Borrower in an arm’s length contract or arrangement with a third party.

(f) Violations.  Except as disclosed in the Environmental Reports, the Borrower has received no written notices of any violation of any applicable material Requirements with respect to any of the properties comprising the Unencumbered Pool Properties.

(g) Environmental Matters.  The Borrower has caused an investigation to be made of the past and present condition and usage of each individual property included in the Unencumbered Pool Properties and the operations conducted thereon and, based upon such investigation, except as disclosed in the Environmental Reports and/or in the Borrower’s filings with the Securities and Exchange Commission, makes the following representations and warranties as of the date hereof and to the best of Borrower’s knowledge:

(i) With respect to the Unencumbered Pool Properties, the Borrower has not received written notice from any third Person including, without limitation, any federal, state or local governmental authority, asserting that any of the operations thereon are in violation of any Environmental Law or any judgment, decree or order related thereto which violation would reasonably be expected to have a material adverse effect on the business, assets or financial condition of the Borrower.

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(ii) The Borrower has not received written notice from any third Person including, without limitation, any federal, state or local governmental authority, asserting (i) that it has been identified by the United States Environmental Protection Agency (“EPA) as a potentially responsible Person with respect to a site listed on the National Priorities List, 40 C.F.R. Part 300 Appendix B (1986); (ii) that any Hazardous Substances which it has generated, transported or disposed of have been found at any site at which a federal, state or local agency or other third Person has conducted or has ordered that the Borrower conduct a remedial investigation, removal or other response action pursuant to any Environmental Law; or (iii) that it is or shall be a named party to any claim, action, cause of action, complaint, or legal or administrative proceeding (in each case, contingent or otherwise) arising out of any third Person’s incurrence of costs, expenses, losses or damages of any kind whatsoever in connection with the release of Hazardous Substances; which would reasonably be expected to have a material adverse effect on the business, assets or financial condition of the Borrower or result in cleanup expenses of Ten Million Dollars ($10,000,000.00) or more in the aggregate.

(iii) With respect to the Unencumbered Pool Properties: (i) no portion of the Unencumbered Pool Properties has been used for the handling, processing, storage or disposal of Hazardous Substances except in connection with the use of the Unencumbered Pool Properties and any such use, handling, storage or disposal has been materially in accordance with applicable Environmental Laws; and no underground tank or other underground storage receptacle for Hazardous Substances is located on any portion of the Unencumbered Pool Properties except in material compliance with Environmental Laws; (ii) in the course of any activities conducted by the Borrower or the operators of its properties, no Hazardous Substances have been generated or are being used on the Unencumbered Pool Properties except materially in accordance with applicable Environmental Laws; (iii) there has been no release, i.e. any past or present releasing, spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, disposing or dumping (a “Release”) or threatened Release of Hazardous Substances on, upon, into or from the Unencumbered Pool Properties, which Release would have a material adverse effect on the value of the Unencumbered Pool Properties; (iv) there have been no Releases on, upon, from or into any real property in the vicinity of any of the Unencumbered Pool Properties which, through soil or groundwater contamination, has come to be located on, and which has a material adverse effect on the value of the Unencumbered Pool Properties; and (v) any Hazardous Substances that have been generated by Borrower on any of the Unencumbered Pool Properties have been managed and/or disposed of materially in compliance with such permits and applicable Environmental Laws.

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(iv) Except with respect to the Unencumbered Pool Properties known as Blue Lagoon and Collins Crossing, neither the Borrower nor any property comprising the Unencumbered Pool Properties is subject to any applicable Environmental Law requiring the performance of Hazardous Substances site assessments, or the removal or remediation of Hazardous Substances, or the giving of notice to any governmental agency or the recording or delivery to other Persons of an environmental disclosure document or statement by virtue of the transactions set forth herein and contemplated hereby, in any case which would reasonably be expected to have a material adverse effect on the business, assets or financial condition of the Borrower or result in cleanup expenses of Ten Million Dollars ($10,000,000.00) or more in the aggregate.

(v) The Borrower shall indemnify, defend, and hold the Agent and the Lenders harmless of and from any claim brought or threatened against the Agent and the Lenders by the Borrower, any guarantor or endorser of the Obligations, or any governmental agency or authority or any other person (as well as from attorneys’ reasonable fees and expenses in connection therewith) on account of the presence of hazardous material or oil on any of the Unencumbered Pool Properties, the release of hazardous materials or oil on or from any of the Unencumbered Pool Properties, or the failure by the Borrower to comply with the terms and provisions hereof (each of which may be defended, compromised, settled, or pursued by the Agent with counsel of the Agent’s selection, but at the expense of the Borrower).  This indemnification covers any costs and expenses that the Agent and/or the Lenders may incur and any damages or other liabilities including reasonable attorneys’ fees for assessment, containment and/or removal of any hazardous material or oil from all or any portion of the Unencumbered Pool Properties or any surrounding areas.  The within indemnification shall survive payment of the Obligations and/or any termination, release, or discharge executed by the Agent in favor of the Borrower; provided, however, that such indemnification shall not apply to any claim brought or threatened against the Agent and/or the Lenders and arising from the Agent’s and/or the Lenders’ gross negligence or willful misconduct.

8.18           No Broker or Finder.  Neither Borrower, nor anyone on behalf thereof, has dealt with any broker, finder or other person or entity who or which may be entitled to a broker’s or finder’s fee, or other compensation, payable by Agent or the Lenders in connection with establishing of the Loan.

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8.19           General.  Each Borrower has disclosed any material fact or condition which is necessary to make the representations and warranties set forth herein or in any other Loan Document not materially misleading; provided that the Borrower shall have no obligation to update any representation and warranty made as of a specific date.

8.20           Representations, Warranties, Covenants and Agreements with Respect to the Unencumbered Pool Properties.  The representations, warranties, covenants and agreements contained herein with respect to the Unencumbered Pool Properties, or any of the properties comprising the Unencumbered Pool Properties, shall be made as of the date hereof and no representations, warranties, covenants and agreements are made with respect to the Unencumbered Pool Properties subsequent to the date hereof.

9.           AFFIRMATIVE COVENANTS OF THE BORROWER.  The Borrower covenants and agrees that, so long as the Loan is outstanding:

9.1           Punctual Payment.  The Borrower will duly and punctually pay or cause to be paid the principal and interest on the Loan and all other amounts provided for in the Note, this Agreement and the other Loan Documents to which the Borrower is a party, all in accordance with the terms of the Notes, this Agreement and such other Loan Documents.

9.2           Financial Statements, Certificates and Information.  The Borrower will deliver, or cause to be delivered, to the Lenders:

(a) as soon as practicable, but in any event not later than ninety (90) days after the end of each fiscal year of the Borrower, on a consolidated basis the audited balance sheet (i.e. SEC Form 10-K) of the Borrower at the end of such year, and the related audited statement of income, statement of retained earnings, changes in capital, operating statements, and statement of cash flows for such year, each setting forth in comparative form the figures for the previous fiscal year and all such statements to be in reasonable detail, prepared in accordance with generally accepted accounting principles, and accompanied by an auditor’s report prepared without qualification by Ernst & Young LLP or by another independent certified public accountant reasonably acceptable to the Lender, together with a written statement from the chief financial officer of the company stating that such officer has read a copy of this Agreement, and that, in making the examination necessary to said certification, such officer has obtained no knowledge of any Default or Event of Default under this Agreement, or, if such officer shall have obtained knowledge of any then existing Default or Event of Default he or she shall disclose in such statement any such Default or Event of Default.  In the event that the Borrower has filed a Notification of Late Filing Form (SEC Form 12b-25) with the Securities and Exchange Commission, then the Borrower will not be in violation of this Section as long as the Borrower provides the Agent with such required financial statement no later than three Business Days after such financial statements have been filed with the Securities and Exchange Commission;

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(b) as soon as practicable, but in any event not later than forty-five (45) days after the end of each fiscal quarter of the Borrower, copies of the unaudited balance sheet (i.e. SEC Form 10Q) of the Borrower as at the end of such quarter, and the related unaudited statement of income, statement of retained earnings, changes in capital, and statement of cash flows for the portion of the Borrower’s fiscal year then elapsed, all in reasonable detail and prepared in accordance with generally accepted accounting principles, together with a certification by the principal financial or accounting officer, partner or trustee of the Borrower that the information contained in such financial statements fairly presents the financial position of the Borrower on the date thereof (subject to year-end adjustments) and that, in making the examination necessary to said certification, such Person has obtained no knowledge of any Default or Event of Default under this Agreement.  In the event that the Borrower has filed a Notification of Late Filing Form (Form 12b-25) with the Securities and Exchange Commission, then the Borrower will not be in violation of this Section as long as the Borrower provides the Agent with such required financial statement no later than three business days after such financial statements have been filed with the Securities and Exchange Commission;

(c) contemporaneously with the delivery of the financial statements referred to in clause (a) above, a statement of all contingent liabilities of the Borrower which are not reflected in such financial statements or referred to in the notes thereto, certified by the principal financial or accounting office of FSP as fairly presenting the financial condition of the Borrower as at the close of business on the date(s) thereof, and upon request of the Agent, annual budget and cash flow forecasts for the Borrower and Unencumbered Pool Properties all in reasonable detail;

(d) simultaneously with the delivery of the financial statements referred to in clauses (a) and (b) above, a covenant compliance certificate signed by the principal financial or accounting officer of FSP and setting forth in reasonable detail computations evidencing compliance with the covenants contained in §10.8; and

(e) from time to time such other financial data and information (including accountants’ management letters) as the Lender may reasonably request.

9.3           Insurance.

(a) Upon request, the Borrower will provide evidence of insurance with respect to each of the properties comprising the Unencumbered Pool Properties.

(b) The Borrower will provide the Agent with certificates evidencing such insurance upon the request of the Agent.

9.4           Liens and Other Charges.  The Borrower will duly pay and discharge, or cause to be paid and discharged, before the same shall become overdue all claims for labor, materials, or supplies that if unpaid would reasonably be expected by law to become a lien or charge upon any of its Other Properties, except for Permitted Liens, or any of the Unencumbered Pool Properties, except as to the Permitted Liens otherwise permitted in the definition of Unencumbered Pool Properties.

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9.5           Inspection of Unencumbered Pool Properties and Books.  Subject to the cost limitation set forth in Section 13 below,

(a) The Borrower shall permit the Agent and the Lenders at the Borrower’s expense, to visit and inspect any of the properties comprising the Unencumbered Pool Properties and will cooperate with the Agent and the Lenders during such inspections provided that this provision shall not be deemed to impose on the Agent and the Lenders any obligation to undertake such inspections; provided that so long as no Default or Event of Default shall have occurred and be continuing, the Borrower shall only be obligated to pay the reasonable expenses associated with one (1) such investigation of the books of account of the Borrower during any twelve (12) month period commencing with the first anniversary of this Agreement.  Any such inspections are to be conducted during normal business hours and prior to the occurrence and continuation of an Event of Default, Lenders shall provide Borrower with forty-eight (48) hours advance notice.

(b) The Borrower shall permit the Agent and the Lenders at the Borrower’s reasonable expense to discuss the affairs, finances and accounts of the Borrower with, and to be advised as to the same by, its officers, partners, or trustees, all at such reasonable times and intervals as the Agent and Lenders may reasonably request.

9.6           Compliance with Laws, Contracts, Licenses, and Permits.  The Borrower will comply in all material respects with (a) the applicable laws and regulations wherever its business is conducted, including all Environmental Laws and, in the case of the Borrower, all Requirements, (b) the provisions of its Organizational Documents and all Loan Documents to which Borrower or Subsidiary are signatories, (c) all agreements and instruments by which it or any of its properties may be bound, including, all restrictions, covenants and easements affecting the Unencumbered Pool Properties, (d) all applicable decrees, orders and judgments, and (e) all licenses and permits required by applicable laws and regulations for the conduct of its business or the ownership, use or operation of its properties.

9.7           Use of Proceeds.  The Borrower will use the proceeds of the Loan solely for the purposes described herein.  No portion of the Loan shall be used directly or indirectly, and whether immediately, incidentally or ultimately (i) to purchase or carry any margin stock, or to extend credit to others for the purpose thereof, or to repay or refund indebtedness previously incurred for such purpose, within the meaning of the regulations of the Board of Governors of the Federal Reserve System including, without limitation, Regulations G, U and X and the interpretations thereof, or (ii) for any purpose which would violate or is inconsistent with the provisions of regulations of the Board of Governors of the Federal Reserve System including, without limitation, Regulations G, U and X thereof.

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9.8           Publicity.  The Borrower will permit the Lenders to obtain publicity in connection with the financing through press releases.  The Borrower shall be provided with an opportunity to review and approve such publicity prior to publication.

9.9           Further Assurances. The Borrower will cooperate with, and will do such further acts and execute such further instruments and documents as the Agent and the Lenders shall reasonably request to carry out to its satisfaction the transactions contemplated by this Agreement and the other Loan Documents.

9.10           Notices.  The Borrower will promptly notify the Agent in writing of (i) the occurrence of any Event of Default; (ii) the occurrence of any other event which is likely to have a materially adverse effect on any of the properties comprising the Unencumbered Pool Properties or the business or financial condition of the Borrower; or (iii) the receipt by the Borrower of any notice of default or notice of termination with respect to any contract or agreement relating to the ownership, operation, or use of any of the properties comprising the Unencumbered Pool Properties which is likely to have a materially adverse effect on the Borrower.

9.11           Other Affirmative Covenants.  The Borrower will:

(a) On a consolidated basis, (a) not become insolvent, (b) not have unreasonably small capital with which to engage in its business, (c) not incur Indebtedness beyond its ability to pay such Indebtedness as it matures, and (d) have assets having a value in excess of amounts required to pay any Indebtedness;

(b) At all times hold itself out to the public as a legal entity, separate and distinct from any other Person, including any Subsidiary of the Borrower, or any parent or affiliate of the Borrower; and

(c) Maintain adequate capital for the normal obligations reasonably foreseeable for a business of its size and character and in light of its contemplated business operations.

9.12           Control of Borrower.  Borrower agrees that at least two of George J. Carter, Barbara J. Fournier, Janet P. Notopoulos, John G. Demeritt, John N. Burke or Georgia Murray or a replacement officer (or director) which is approved by Lenders in its reasonable discretion, shall, at all times maintain control of the day to day operations of the Borrower; provided that it shall not be a Default or an Event of Default during the period of ninety (90) days during which replacement director(s) or officer(s), as the case may be, are being sought and approved.  The parties acknowledge that Georgia Murray and John Burke are currently members of the board of directors of FSP, and as such, do not maintain control the day to day operations of the Borrower as of the date hereof.

9.13           Wholly Owned Subsidiary.  The Borrower shall provide Agent with written notice of the establishment of a Wholly Owned Subsidiary.  At the time of an Acquisition by a Wholly Owned Subsidiary, such Wholly Owned Subsidiary which has become an owner of a Property in connection with such Acquisition shall execute the Joinder Documents so as to become a Borrower under this Agreement.

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9.14           Maintenance of Borrower’s Properties.  Borrower will protect and maintain, or cause to be maintained, in a manner consistent with Borrower’s current maintenance standards at all times, the buildings and structures now standing or hereafter erected on the Borrower’s properties, and any additions and improvements thereto, and all personal property now or hereafter situated therein, and the utility services, the parking areas and access roads, and all building fixtures and equipment and articles of personal property now or hereafter acquired and used in connection with the operation of the Borrower’s properties.

9.15           Acquisitions, Dispositions and Syndication of Borrower’s Assets.  Borrower shall provide Agent with written notice of all dispositions or Acquisitions of individual properties by FSP or a Wholly Owned Subsidiary within seven (7) days prior to the disposition or Acquisition.  With respect to any Acquisitions, the notice shall include the location of the property, the purchase price and the projected closing date.  With respect to any disposition (other than an Affiliate Disposition) of individual properties by a Wholly Owned Subsidiary, the notice shall include a certification from the chief financial officer of FSP stating that such disposition shall not cause a violation of any covenant contained herein, including, without limitation, any breach of §10.8, both before and after such disposition, and that no Default or Event of Default exists hereunder.  With respect to Syndication REITS, Borrower will provide Agent with a copy of the applicable confidential offering memorandum on or before the first Syndication Event for such offering.  .   All real property acquired in an Acquisition by FSP or a Wholly Owned Subsidiary (including a 1031 Property) shall become part of the Property and shall be subject to the terms hereof, and the definition of Property shall include all such real property (including 1031 Property) and to exclude any real property disposed of by the Borrower pursuant to the terms hereof.

9.16           Business Activities.  The Borrower shall limit its business activities to the ownership, construction, operation and maintenance of income producing properties and investment banking activities related thereto and all matters incidental or accessory thereto.

10.           NEGATIVE COVENANTS OF THE BORROWER.  The Borrower covenants and agrees that, so long as the Loan is outstanding or the Lenders have any obligation to make any Advances:

10.1           No Amendments, Terminations or Waivers.  The Borrower will not, directly or indirectly, amend, or allow the amendment of, any of the Organizational Documents of the Borrower following the date of this Agreement in any material respect.

10.2           Restrictions on Indebtedness.  The Borrower will not create, incur, assume, guaranty or be or remain liable, contingently or otherwise, with respect to any Indebtedness other than:

(a) Indebtedness to the Agent and the Lenders arising under any of the Loan Documents;

(b) current liabilities of the Borrower incurred in the ordinary course of business but not incurred through (i) the borrowing of money, or (ii) the obtaining of credit except for credit on an open account basis customarily extended and in fact extended in connection with normal purchases of goods and services;

(c) Indebtedness arising under the Revolver Loan;

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(d) Indebtedness on acquired properties which was existing on such properties as of the date of the acquisition and replacement financing thereof;

(e) Indebtedness secured by liens on Other Properties, and the liens on Unencumbered Pool Properties (limited to Permitted Liens permitted in the definition of Unencumbered Pool Properties) subject to the limitations in Section 10.8(g);

(f) Hedging Obligations;

(g) Contingent liabilities associated with the disposition of properties, provided that any such liabilities would not reasonably be expected to have a material adverse effect on Borrower’s financial condition; and

(h) Indebtedness not to exceed the principal amount of $1,000,000 at any time outstanding, including without limitation guarantees and capital leases.

10.3           Restrictions on Liens, Etc.  With the exception of Permitted Liens, the Borrower will not  (a) create or incur or suffer to be created or incurred or to exist any lien, encumbrance, mortgage, pledge, charge or other security interest of any kind upon any of the Borrower’s Properties, or upon the income or profits therefrom; (b) transfer any of the Borrower’s Properties or the income or profits therefrom for the purpose of subjecting the same to the payment of Indebtedness or performance of any other obligation in priority to payment of its general creditors, except as provided in Section 10.2(e); (c) acquire, or agree or have an option to acquire, any property or assets upon conditional sale or other title retention or purchase money security agreement, device or arrangement; (d) suffer to exist for a period of more than thirty (30) days after the same shall have been incurred any Indebtedness or claim or demand against it that if unpaid would likely by law or upon bankruptcy or insolvency, or otherwise, be given any priority whatsoever over its general creditors; or (e) sell, assign, pledge or otherwise transfer any accounts, contract rights, general intangibles, chattel paper or instruments, with or without recourse; provided that the Borrower may create or incur or suffer to be created or incurred or to exist liens in favor of the Lenders under the Loan Documents and in favor of the agent and lenders under the Revolver Loan.  Notwithstanding the foregoing, the Borrower may sell any of its Property, whether now owned or hereafter acquired, provided that prior to and after any such sale (i) the Borrower is in compliance with all of its covenants herein, including, without limitation, the financial covenants contained in §10.8, and (ii) No Default or Event of Default has occurred and is continuing hereunder.

10.4           Restrictions on Loans and Investments.  The Borrower will not make or permit to exist or to remain outstanding any loan by the Borrower to any Person or any Investment except Investments in:

(a) marketable direct or guaranteed obligations of the United States of America that mature within two (2) years from the date of purchase by the Borrower;

(b) demand deposits and bankers acceptances of United States banks having total assets in excess of $1,000,000,000;

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(c) certificates of deposit and time deposits of United States banks having total assets in excess of $1,000,000,000 that mature within one (1) year from the date of purchase by the Borrower;

(d) securities commonly known as “commercial paper” issued by a corporation organized and existing under the laws of the United States of America or any state thereof that at the time of purchase have been rated and the ratings for which are not less than “P 1” if rated by Moody’s Investors Services, Inc., and not less than “A 1” if rated by Standard and Poor’s;

(e) Subsidiaries;

(f) investments in Real Estate Assets

(g) mutual funds managed by Agent and Co-Agent or their respective affiliates;

(h) mutual or closed-end funds substantially all of whose assets are comprised or securities of the types described in clauses (a) through (d) and (g) above;

(i) Investments in an aggregate amount not to exceed $2,500,000.00;

(j) Investments consisting of loans and advances to employees for reasonable travel, relocation and business expenses in the ordinary course of business, extensions of trade credit in the ordinary course of business and prepaid expenses in the ordinary course of business;

(k) Investments in connection with Syndication Events and Acquisitions; and

(l) Investments in land, development projects, and joint ventures which do not exceed ten (10%) percent of Consolidated Total Asset Value.

10.5           Merger, Consolidation, Conversion, Business Operations, and Ownership and Disposition of Assets.

(a) The Borrower shall not own any assets other than investments permitted in 10.4 (a) - (l), income-producing properties, other assets incidental to the ownership or operation of such property, investment banking services and property management companies.

(b) After the date of this Agreement, the Borrower will not become a party to any merger or consolidation, or agree to or effect any asset acquisition or stock acquisition except in connection with (i) the establishment of a Syndication REIT, (ii) a Syndication Event, or (iii) an Acquisition.

(c) The Borrower will not convert into any other type of entity that would adversely affect the Borrower’s status as a REIT.

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(d) The Borrower will not engage in any business operations other than those necessary for or incidental to the ownership, construction, management, or operation of income-producing property, Real Estate Assets, and investment banking services.

10.6           Sale and Leaseback.  The Borrower will not enter into any arrangement, directly or indirectly, whereby the Borrower shall sell or transfer any property owned by it in order then or thereafter to lease such property or lease other property that the Borrower intends to use for substantially the same purpose as the property being sold or transferred.

10.7           Distributions.  Except for Distributions necessary to maintain the REIT status of the Borrower, after the occurrence and during the continuation of a Default or an Event of Default (unless and until cured within any applicable cure period), the Borrower will not make any Distributions.  The Borrower will also not make any Distributions which would cause a Default or Event of Default

10.8           Financial Covenants.  The Borrower covenants and agrees that, so long as the Loan is outstanding,

(a) Loan to Value.  The ratio (“Loan to Value Ratio”) obtained by dividing the aggregate, without duplication, of (i) the outstanding principal balance of the Loan, (ii) the outstanding principal balance of the Revolver Loan (inclusive of the face amount of any undrawn Letters of Credit issued thereunder), and (iii) other unsecured indebtedness for borrowed money, by the Value of the Unencumbered Pool Properties, expressed as a percentage, shall not be greater than sixty percent (60%).  This covenant shall be tested at the end of each fiscal quarter of the Borrower.  In testing compliance with this covenant the Value of the Unencumbered Pool Properties attributed to any one property may not exceed 20% of the aggregate Value of the Unencumbered Pool Properties for all properties.

(b) Ratio of Net Operating Income to Debt Service Charges.  The Borrower will not permit the ratio of Net Operating Income of Borrower to Debt Service Charges to be less than 2.0 to 1.0.  This covenant shall be tested at the end of each fiscal quarter of the Borrower.

(c) Consolidated Indebtedness.  The Borrower will not permit Consolidated Indebtedness to exceed 50% of the aggregate of (i) the Value of the Properties plus (ii) the book value of all tangible assets of the Borrower (other than real estate and after eliminating any duplication which will include (a) cash and cash equivalents, (b) stock held in Syndication REITS, and (c) mortgage receivables from Syndication REITS).  This covenant shall be tested at the end of each fiscal quarter of the Borrower.

(d) Unencumbered Liquidity.  The Borrower shall maintain minimum unencumbered cash and other liquid investments in the form of the Investments described in Section 10.4 (a) through (d),(g) and (h), and in trust accounts, in an amount of not less than of $15,000,000.  This covenant shall be tested at the end of each fiscal quarter of the Borrower.

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(e) Account Balances.  The Borrower, any Wholly Owned Subsidiaries and affiliated companies, shall, at all times, maintain with the Agent or its affiliate minimum checking account and savings account (exclusive of trust accounts) collected balances of $1,500,000.00 (less any amount maintained in checking accounts and savings accounts (exclusive of trust accounts) with the agent under the Revolver Loan).  This covenant shall be tested at the end of each fiscal quarter of the Borrower.

(f) Net Worth.  The Borrower shall, at the end of each fiscal quarter, maintain a minimum Tangible Net Worth of $552,000,000.00 plus seventy-five (75%) percent of (i) any net proceeds from future offerings of stock of FSP, or (ii) any increase in shareholder equity of FSP arising from mergers.  This covenant shall be tested at the end of each fiscal quarter of the Borrower.

(g) Maximum Secured Debt.  The Borrower will not permit secured Indebtedness of the Borrower to exceed 25% of the Value of the Properties.

(h) Unencumbered Pool Coverage Ratio.  The Borrower will not permit the ratio of Net Operating Income attributable to the ownership or operation of the Unencumbered Pool Properties to Debt Service Charges on Unencumbered Properties to be less than 2.0 to 1.0.  This covenant shall be tested at the end of each fiscal quarter of the Borrower.

10.9           Other Negative Covenants.  The Borrower will not:

(a) Seek the dissolution or winding up, in whole or in part, of the Borrower (other than after the property of such Borrower has been disposed of in accordance with the provisions of this Agreement) or voluntarily file, or consent to the filing of, a petition for bankruptcy, reorganization, assignment for the benefit of creditors or similar proceedings; and

(b) Commingle any of its accounts with accounts of any other Person, including, any Subsidiary of the Borrower, or parent or affiliate of the Borrower.

11.           EVENTS OF DEFAULT AND REMEDIES.

11.1           Events of Default.  The occurrence of any one or more of the following conditions or events shall constitute an “Event of Default”:

(a) any failure by the Borrower to pay, within five (5) days of the due date, any interest on or principal of or other sum payable under the Notes; or

(b) any failure by the Borrower to pay as and when due and payable any other sums to be paid by the Borrower to the Agent or the Lenders under this Agreement and the continuance of such failure for a period of five (5) days after notice thereof from the Agent; or

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(c) with the exception of a Permitted Lien, title to the Unencumbered Pool Properties is or becomes reasonably unsatisfactory to the Lenders by reason of any lien, charge, encumbrance, title condition or exception and such matter causing title to be or become unsatisfactory is not cured to Lenders’ reasonable satisfaction or removed within twenty (20) days after notice thereof from the Agent to the Borrower; or

(d) the Unencumbered Pool Properties or any material part thereof is subject to a Taking; or

(e) any failure by the Borrower to duly observe or perform any term, covenant, condition or agreement contained in §9.3, §9.13, §10.1, §10.2, §10.4, §10.8 or §10.9 hereof; or

(f) any representation or warranty made or deemed to be made by or on behalf of the Borrower in this Agreement or in any of the other Loan Documents, or in any report, certificate, financial statement, document or other instrument delivered pursuant to or in connection with this Agreement, any Advance or any of the other Loan Documents, shall prove to have been false or incorrect in any material respect upon the date when made or deemed to be made or repeated; or

(g) any dissolution, termination, partial or complete liquidation, merger or consolidation of the Borrower, or any sale, transfer or other disposition of all or substantially all of the assets of the Borrower, other than as permitted under the terms of this Agreement; or

(h) any suit or proceeding shall be filed against the Borrower or any of the properties comprising the Unencumbered Pool Properties which is reasonably likely to result in a judgment which would have a materially adverse affect on the ability of the Borrower to perform their respective material obligations under and by virtue of the Loan Documents; or

(i) unless otherwise approved by Required Lenders in their reasonable discretion, at least two of George J. Carter, Barbara J. Fournier, Janet P. Notopoulos, John G. Demeritt, John N. Burke or Georgia Murray or a replacement officer or director approved by the Lenders in their reasonable discretion, fails to retain control of the day to day management of the Borrower; provided that it shall not be a Default or an Event of Default for ninety (90) days while Borrower is seeking to replace such officer or director; or

(j) any failure by the Borrower to pay at maturity, or within any applicable period of grace, any material obligation for borrowed money or credit received, including, without limitation, any Obligations, or in respect of any capitalized material lease, or any failure to observe or perform any material term, covenant or agreement contained in any material agreement evidencing or securing borrowed money or credit received, or in respect of any capitalized lease, and the result of such failure is that the holder or holders thereof or of any obligations issued thereunder to accelerate the maturity thereof; or

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(k) Borrower shall file a voluntary petition in bankruptcy under Title 11 of the United States Code, or an order for relief shall be issued against any such Person in any involuntary petition in bankruptcy under Title 11 of the United States Code, or  any such Person shall file any petition or answer seeking or acquiescing in any reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief for itself under any present or future federal, state or other law or regulation relating to bankruptcy, insolvency or other relief of debtors, or such Person shall seek or consent to or acquiesce in the appointment of any custodian, trustee, receiver, conservator or liquidator of such Person, or of all or any substantial part of its respective property, or such Person shall make an assignment for the benefit of creditors, or such Person shall give notice to any governmental authority or body of insolvency or pending insolvency or suspension of operation; or

(l) an involuntary petition in bankruptcy under Title 11 of the United States Code shall be filed against the Borrower and such petition shall not be dismissed within sixty (60) days of the filing thereof; or

(m) a court of competent jurisdiction shall enter any order, judgment or decree approving a petition filed against the Borrower seeking any reorganization, arrangement, composition, readjustment, liquidation or similar relief under any present or future federal, state or other law or regulation relating to bankruptcy, insolvency or other relief for debtors, or appointing any custodian, trustee, receiver, conservator or liquidator of all or any substantial part of its property; or

(n) any uninsured final judgment in excess of $2,000,000 shall be rendered against the Borrower and shall remain in force, undischarged, unsatisfied and unstayed, for more than thirty (30) days, whether or not consecutive; or

(o) any of the Loan Documents shall be canceled, terminated, revoked or rescinded by Borrower otherwise than in accordance with the terms thereof or with the express prior approval of the Lenders, or any action at law, suit in equity or other legal proceeding to cancel, revoke or rescind any of the Loan Documents shall be commenced by or on behalf of the Borrower which is a party thereto or any of their respective stockholders, partners or beneficiaries, or any court or any other governmental or regulatory authority or agency of competent jurisdiction shall make a determination that, or issue a judgment, order, decree or ruling to the effect that, any one or more of the Loan Documents is illegal, invalid or unenforceable against the Borrower in accordance with the terms thereof; or

(p) any Borrower or any Subsidiary thereof shall be indicted for a federal or state crime, a punishment for which could include the forfeiture of any of its assets; or

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(q) any failure by the Borrower to duly observe or perform any other term, covenant, condition or agreement under this Agreement and continuance of such failure for a period of thirty (30) days after notice thereof from the Agent; or

(r) any failure by the Borrower to duly perform all of its obligations under any Hedging Contract that hedges Borrower’s interest rates under this Agreement, which such failure results in the designation by the Agent of an “Early Termination Date” with respect to the Borrower pursuant to (and as defined in)  Section 6(a) of the applicable Hedging Contract; or

(s) any Event of Default under the Revolver Loan; or

(t) any “Event of Default”, as defined or otherwise set forth in any of the other Loan Documents, shall occur.

11.2           Termination of Advances and Acceleration.  Upon the occurrence of any Default or Event of Default, Lenders shall have the right to suspend the making of any Advances.  Further, if any one or more Events of Default shall occur and be continuing, the Agent may by notice to the Borrower declare the Lenders’ obligations to make Advances hereunder to be terminated, whereupon the same shall terminate and the Lenders shall be relieved of all obligations to make Advances to the Borrower, and/or declare all unpaid principal of and accrued interest on the Notes, together with all other amounts owing under the Loan Documents, to be immediately due and payable, whereupon same shall become and be immediately due and payable, anything in the Loan Documents to the contrary notwithstanding, without presentment, protest, demand or other notice of any kind, all of which are hereby expressly waived by the Borrower and, to the extent Lenders hold in an account any unapplied proceeds from a Syndication Event, Agent or the Lenders may immediately apply such funds in satisfaction of any unpaid principal of and accruing interest on the Notes; provided that if any one or more of the Events of Default specified in §11.1 (k), §11.1 (l), or §11.1 (m), above, shall occur with respect to any Borrower, the Lenders’ obligations to make Advances hereunder automatically shall so terminate and all unpaid principal of and accrued interest on the Notes, together with all other amounts owing under the Loan Documents, automatically shall become and be immediately so due and payable, without any declaration or other act on the part of the Agent or the Lenders.

11.3           Other Remedies.  If any one or more of the Events of Default shall have occurred and continued beyond any applicable grace periods, and whether or not the Lenders shall have terminated its obligations to make Advances or accelerated the maturity of the Loan pursuant to §11.2, the Agent and the Lenders may proceed to protect and enforce its rights and remedies under this Agreement, the Note or any of the other Loan Documents, including, by foreclosure, exercise of set-off or pledge rights and/or by suit in equity, action at law or other appropriate proceeding, whether for the specific performance of any covenant or agreement contained in this Agreement and the other Loan Documents or any instrument pursuant to which the Obligations are evidenced, including as permitted by applicable law the obtaining of the ex parte appointment of a receiver, and, if any amount owed to the Agent or the Lenders shall have become due, by declaration or otherwise, proceed to enforce the payment thereof or any other legal or equitable right of the Agent or the Lenders.  No remedy conferred upon the Agent or the Lenders or the holder of the Note in this Agreement or in any of the other Loan Documents is intended to be exclusive of any other remedy and each and every remedy shall be cumulative and shall be in addition to every other remedy given hereunder or thereunder or now or hereafter existing at law or in equity or by statute or any other provision of law.

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Notwithstanding any provisions of this Agreement to the contrary, all terms and conditions of this Agreement, and all rights and remedies of the Lenders hereunder are subject to and limited by the terms and conditions of the Intercreditor Agreement as the terms of the Intercreditor Agreement may be applicable to same.

11.4           Distribution of Proceeds.  Subject to the terms and conditions hereof, the Agent shall distribute all Liquidation Proceeds allocated to the Loan as provided above on a pro-rata basis in the order and manner set forth below:

First: To the Agent, towards any fees and any expenses for which the Agent is entitled to reimbursement under this Agreement or the other Loan Documents not theretofore paid to the Agent.

Second: To all Lenders in accordance with their proportional share based upon their respective Commitment Percentages until all Lenders have been reimbursed for all expenses which such Lenders have previously paid to the Agent and not theretofore paid to such Lenders.

Third: To the ratable payment, on a pari passu basis, of (a) all principal and interest due to Lenders under the Loan, with each Lender applying the proceeds for purposes of this Agreement first against the outstanding principal balance due to such Lender under the Loan and then to accrued and unpaid interest due under the Loans, and (b) any outstanding obligations under any Hedging Contracts (including outstanding obligations to any hedge provider which was a Lender or Affiliate of a Lender at the time such derivative transaction was entered into).

Fourth: To all applicable Lenders in accordance with their proportional share based upon their respective Commitment Percentages until all Lenders have been paid in full all other amounts due to such Lenders under the Loan including, without limitation, any costs and expenses incurred directly by such Lenders to the extent such costs and expenses are reimbursable to such Lenders by the Borrowers under the Loan Documents.

Fifth: To the Borrowers or such third parties as may be entitled to claim Liquidation Proceeds.

11.5           Power of Attorney.  For the purposes of carrying out the provisions and exercising the rights, remedies, powers and privileges granted by or referred to in this Article, after the occurrence of an Event of Default and during the continuation thereof the Borrower hereby irrevocably constitutes and appoints the Agent its true and lawful attorney-in-fact, with full power of substitution, to execute, acknowledge and deliver any instruments and do and perform any acts which are referred to in this Article, in the name and on behalf of the Borrower.  The power vested in such attorney-in-fact is, and shall be deemed to be, coupled with an interest and irrevocable.

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11.6           Waivers.  The Borrower hereby waives to the extent not prohibited by applicable law and to the extent not expressly required hereunder (a) all presentments, demands for performance, notices of nonperformance (except to the extent required by the provisions hereof or of any of the other Loan Documents), protests and notices of dishonor, (b) any requirement of diligence or promptness on the Agent’s or Lenders’ part in the enforcement of its rights (but not fulfillment of its obligations) under the provisions of this Agreement or any of the other Loan Documents, and (c) any and all notices of every kind and description which may be required to be given by any statute or rule of law and any defense of any kind which the Borrower may now or hereafter have with respect to its liability under this Agreement or under any of the other Loan Documents.

12.           SETOFF.  After the occurrence and during the continuation of an Event of Default, Borrower agrees that Lenders may set off on account of the Obligations upon and against all of Borrower’s accounts maintained with the Lenders (excluding all non-Borrower accounts or trust accounts) deposits, credits and other property, now or hereafter in the possession, custody, safekeeping or control of Lenders or any entity related to or affiliated with Lenders or in transit to any of them.  After the occurrence of an Event of Default continuing beyond any applicable grace periods, any such deposits (general or specific, time or demand, provisional or final, regardless of currency, maturity, or the branch of the Lender where such deposits are held) credits and property may be applied to or set off, without notice or compliance with any other condition precedent (all of which is hereby waived) against the payment of the Obligations and any and all other Obligations in such manner and order as Lenders in its sole discretion may determine subject to §11.4.

13.           EXPENSES.  The Borrower agrees to pay (a) the reasonable costs of producing and reproducing this Agreement, the other Loan Documents and the other agreements and instruments mentioned herein, (b) any taxes (including any interest and penalties in respect thereto) payable by the Lenders (other than franchise taxes and taxes based upon the Lenders’ net income or receipts), including any taxes payable on or with respect to the transactions contemplated by this Agreement, including any taxes payable by the Lenders after the Closing Date (the Borrower hereby agreeing to indemnify the Lenders with respect thereto), (c) the reasonable fees, expenses and disbursements of the Agent’s counsel or any local counsel to the Agent incurred in connection with the preparation or interpretation of the Loan and the Loan Documents and other instruments mentioned herein, the making of each Advance hereunder, and amendments, modifications, approvals, consents or waivers hereto or hereunder, (d) the reasonable fees, expenses and disbursements of the Agent incurred in connection with the preparation or interpretation of the Loan and the Loan Documents and other instruments mentioned herein, and the making of each Advance hereunder (including all reasonable appraisal fees, and surveyor fees subject to the terms of §9.5 hereof), (e) all reasonable out-of-pocket expenses (including reasonable attorneys’ fees and costs) and the reasonable fees and costs of consultants, accountants, auctioneers, receivers, brokers, property managers, appraisers, investment bankers or other experts retained by the Agent or the Lenders in connection with (i) the enforcement of or preservation of rights under any of the Loan Documents against the Borrower or the administration thereof after the occurrence and during the continuation of a Default or Event of Default and (ii) any litigation, proceeding or dispute arising hereunder, (f) all reasonable fees, expenses and disbursements of the Agent and the Lenders incurred in connection with UCC searches, UCC filings, title rundowns, title searches or mortgage recordings in accordance with the terms hereof; and (g) all reasonable costs associated with annual inspections, or at any time after the occurrence and continuation of an Event of Default, all reasonable expenses incurred by Agent for site visits for real property located outside of the Commonwealth of Massachusetts which expenses shall not exceed $10,000.00per year.  The covenants of this Section shall survive payment or satisfaction of payment of all amounts owing with respect to the Notes.

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14.           INDEMNIFICATION.  The Borrower agrees to indemnify and hold harmless the Agent and the Lenders from and against any and all claims, actions and suits, whether groundless or otherwise, and from and against any and all liabilities, losses, damages and expenses of every nature and character arising out of this Agreement or any of the other Loan Documents or the transactions contemplated hereby and thereby including, without limitation, (a) any brokerage, leasing, finders or similar fees, (b) any disbursement of the proceeds of any of the Advances, (c) any condition of the properties comprising the Unencumbered Pool Properties whether related to the quality of construction or otherwise, (d) any actual or proposed use by the Borrower of the proceeds of any of the Advances, (e) any actual or alleged violation of any Requirements or Project Approvals, (f) any action taken by Lender to enforce its rights and remedies under the Loan Documents, including the rights and remedies set forth in §11 hereof, or (g) the Borrower entering into or performing this Agreement or any of the other Loan Documents, in each case including, without limitation, the reasonable fees and disbursements of counsel incurred in connection with any such investigation, litigation or other proceeding, and in each case except to the extent such claims, actions, suits, liabilities, losses, damages or costs arise due to Agent’s or a Lender’s gross negligence or intentional misconduct.  In litigation, or the preparation therefor, the Lenders shall be entitled to select its own counsel and, in addition to the foregoing indemnity, the Borrower agrees to pay within thirty (30) days the reasonable fees and expenses of such counsel.  The obligations of the Borrower under this Section shall survive the repayment of the Loan and shall continue in full force and effect so long as the possibility of such claim, action or suit exists.  If, and to the extent that the obligations of the Borrower under this Section are unenforceable for any reason, the Borrower hereby agrees to make the maximum contribution to the payment in satisfaction of such obligations which is permissible under applicable law.

15.           LIABILITY OF THE AGENT AND THE LENDERS.   The liability of the Agent and the Lenders to the Borrower for any breach of the terms of this Agreement by the Agent and the Lenders shall not exceed a sum equal to the amount which the Lenders shall be determined to have failed to advance in consequence of a breach by the Lenders of its obligations under this Agreement, together with interest thereon at the rate payable by the Borrower under the terms of the Notes for Advances which the Borrower is to receive hereunder, computed from the date when the Advance should have been made by the Lenders to the date when the Advance is, in fact, made by the Lenders, and, upon the making of any such payment by the Lenders to the Borrower, the same shall be treated as an Advance under this Agreement, in the same fashion as any other Advance under the terms of this Agreement.  In no event shall the Lenders be liable to the Borrower, or anyone claiming by, under or through the Borrower, for any special, exemplary, punitive or consequential damages, whatever the nature of the breach of the terms of this Agreement by the Agent or the Lenders, such damages and claims therefor being expressly WAIVED by the Borrower.

Notwithstanding the foregoing, Borrower agrees that no action shall be commenced by Borrower for any claim of any kind against the Agent or the Lenders under or in connection with this Agreement unless written notice specifically setting forth the claim of Borrower shall have been given to the Agent within ninety (90) days after the occurrence of the event which Borrower alleges gives rise to such claims, and failure to give such notice shall constitute a WAIVER of any such claim.

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16.           RIGHTS OF THIRD PARTIES.  All conditions to the performance of the obligations of the Lenders under this Agreement, including the obligation to make Advances, are imposed solely and exclusively for the benefit of the Lenders and no other Person shall have standing to require satisfaction of such conditions in accordance with their terms or be entitled to assume that the Lenders will refuse to make Advances in the absence of strict compliance with any or all thereof and no other Person shall, under any circumstances, be deemed to be a beneficiary of such conditions, any and all of which may be freely waived in whole or in part by the Lender at any time if in its sole discretion it deems it desirable to do so.

17.           SURVIVAL OF COVENANTS, ETC.  All covenants, agreements, representations and warranties made herein, in the Notes, in any of the other Loan Documents or in any documents or other papers delivered by or on behalf of the Borrower pursuant hereto and thereto shall be deemed to have been relied upon by the Lenders, notwithstanding any investigation heretofore or hereafter made by it, and shall survive the making by the Lenders of the Advances, as herein contemplated, and shall continue in full force and effect either (i) so long as any amount due under this Agreement or the Note or any of the other Loan Documents remains outstanding or the Lenders have any obligation to make any Advances or (ii) for such longer period as may be expressly provided for herein or in any other Loan Document.  All statements contained in any certificate or other paper delivered to the Agent or the Lenders at any time by or on behalf of any Person or any Subsidiary thereof pursuant hereto shall constitute representations and warranties by such Person.

18.           THE AGENT AND THE LENDERS.

18.1           Appointment of Agent.  Each Lender hereby irrevocably designates and appoints RBS Citizens, National Association as Agent of such Lender to act as specified herein and in the other Loan Documents, and each such Lender hereby irrevocably authorizes the Agent to take such actions, exercise such powers and perform such duties as are expressly delegated to or conferred upon the Agent by the terms of this Agreement and the other Loan Documents, together with such other powers as are reasonably incidental thereto.  The Agent agrees to act as such upon the express conditions contained in this Article 18.  The Agent shall not have any duties or responsibilities except those expressly set forth herein or in the other Loan Documents, nor shall it have any fiduciary relationship with any Lender, and no implied covenants, responsibilities, duties, obligations or liabilities shall be read into this Agreement or otherwise exist against the Agent.  Except as specifically provided herein, the provisions of this Article 18 are solely for the benefit of the Agent and the Lenders, and the Borrower shall not have any rights as a third party beneficiary of any of the provisions hereof.

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18.2           Administration of Loan by Agent.  The Agent shall be responsible for administering the Loan on a day-to-day basis.  In the exercise of such administrative duties, the Agent shall use the same diligence and standard of care that is customarily used by the Agent with respect to similar loans held by the Agent solely for its own account.

Each Lender delegates to the Agent the full right and authority on its behalf to take the following specific actions in connection with its administration of the Loan:

(i) to fund the Loan in accordance with the provisions of the Loan Documents, but only to the extent of immediately available funds provided to the Agent by the respective Lenders for such purpose;

(ii) to receive all payments of principal, interest, fees and other charges paid by, or on behalf of, the Borrower and, except for fees to which the Agent is entitled pursuant to the Loan Documents or otherwise, to distribute all such funds to the respective Lenders as provided for hereunder;

(iii) to keep and maintain complete and accurate files and records of all material matters pertaining to the Loan, and make such files and records available for inspection and copying by each Lender and its respective employees and agents during normal business hours upon reasonable prior notice to the Agent; and

(iv) to do or omit doing all such other actions as may be reasonably necessary or incident to the implementation, administration and servicing of the Loan and the rights and duties delegated hereinabove.

18.3           Delegation of Duties.  The Agent may execute any of its duties under this Loan Agreement or any other Loan Document by or through its agent or attorneys-in-fact, and shall be entitled to the advice of counsel concerning all matters pertaining to its rights and duties hereunder or under the Loan Documents. The Agent shall not be responsible for the negligence or misconduct of any agents or attorneys-in-fact selected by it with reasonable care.

18.4           Exculpatory Provisions.  Neither the Agent nor any of its officers, directors, employees, agents, attorneys-in-fact or affiliates shall be liable to the Lenders for any action lawfully taken or omitted to be taken by it or them under or in connection with this Agreement or the other Loan Documents, except for its or their gross negligence or willful misconduct.  Neither the Agent nor any of its officers, directors, employees, agents, attorneys-in-fact or affiliates shall be responsible for or have any duty to ascertain, inquire into, or verify (i) any recital, statement, representation or warranty made by the Borrower or any of its officers or agents contained in this Agreement or the other Loan Documents or in any certificate or other document delivered in connection therewith; (ii) the performance or observance of any of the covenants or agreements contained in, or the conditions of, this Agreement or the other Loan Documents; (iii) the state or condition of any properties of the Borrower or any other obligor hereunder constituting collateral for the Obligations of the Borrower hereunder, or any information contained in the books or records of the Borrower; (iv) the validity, enforceability, collectibility, effectiveness or genuineness of this Loan Agreement or any other Loan Document or any other certificate, document or instrument furnished in connection therewith; or (v) the validity, priority or perfection of any lien securing or purporting to secure the Obligations or the value or sufficiency of any collateral.

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18.5           Reliance by Agent.  The Agent shall be entitled to rely, and shall be fully protected in relying, upon any notice, consent, certificate, affidavit, or other document or writing believed by it to be genuine and correct and to have been signed, sent or made by the proper person or persons, and upon the advice and statements of legal counsel (including, without limitation, counsel to the Borrower), independent accountants and other experts selected by the Agent.  The Agent shall be fully justified (as to the Lenders) in failing or refusing to take any action under this Agreement or any other Loan Document unless it shall first receive such advice or concurrence of the Required Lenders as it deems appropriate or its shall first be indemnified to its satisfaction by the Lenders against any and all liability and expense which may be incurred by it by reason of the taking or failing to take any such action.  The Agent shall in all cases be fully protected from the Lenders in acting, or in refraining from acting, under this Agreement and the other Loan Documents in accordance with any written request of the Required Lenders, and each such request of the Required Lenders, and any action taken or failure to act by the Agent pursuant thereto, shall be binding upon all of the Lenders; provided, however, that the Agent shall not be required in any event to act, or to refrain from acting, in any manner which is contrary to the Loan Documents or to applicable law.

18.6           Notice of Default.  The Agent shall not be deemed to have knowledge or notice of the occurrence of any Event of Default unless the Agent has actual knowledge of the same or has received notice from a Lender or the Borrower referring to this Agreement, describing such Event of Default and stating that such notice is a “notice of default”.  In the event that the Agent obtains such actual knowledge or receives such a notice, the Agent shall give prompt notice thereof to each of the Lenders. The Agent shall take such action with respect to such Event of Default as shall be reasonably directed by the Required Lender unless and until the Agent shall have received such direction, the Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to any such Event of Default as it shall deem advisable in the best interest of the Lenders, provided, however, that the Agent shall not accelerate the indebtedness under this Loan Agreement without the prior written consent of the Required Lenders.

18.7           Lenders’ Credit Decisions.  Each Lender acknowledges that it has, independently and without reliance upon the Agent or any other Lender, and based on the financial statements prepared by the Borrower and such other documents and information as it has deemed appropriate, made its own credit analysis and investigation into the business, assets, operations, property, and financial and other condition of the Borrower and has made its own decision to enter into this Agreement and the other Loan Documents.  Each Lender also acknowledges that it will, independently and without reliance upon the Agent or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in determining whether or not conditions precedent to closing any Loan hereunder have been satisfied and in taking or not taking any action under this Agreement and the other Loan Documents.  Each Lender expressly acknowledges that is has relied upon its own legal counsel in its consideration of its decision to enter into the Agreement and the other Loan Documents and will so rely in regard to the implementation of the transaction contemplated hereby and thereby and that it does not have any lawyer-client relationship with Agent’s counsel or counsels or any other Lenders with respect thereto.

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18.8           Agent’s Reimbursement and Indemnification.  The Lenders agree to reimburse and indemnify the Agent, ratably in proportion to their respective Commitments, for (i) any amounts not reimbursed by the Borrower for which the Agent is entitled to reimbursement by the Borrower under this Agreement or the other Loan Documents, (ii) any other expenses incurred by the Agent on behalf of the Lenders in connection with the preparation, execution, delivery, administration, amendment, waiver and/or enforcement of this Agreement and the other Loan Documents, and (iii) any liabilities, obligations, losses, damages, penalties, action, judgments, suits, costs, expenses or disbursements of any kind and nature whatsoever which may be imposed on, incurred by or asserted against the Agent in any way relating to or arising out of this Agreement or the other Loan Documents or any other document delivered in connection therewith or any transaction contemplated thereby, or the enforcement of any of the terms hereof or thereof, provided that no Lender shall be liable for any of the foregoing to the extent that they arise from the gross negligence or willful misconduct of the Agent.  If any indemnity furnished to the Agent for any purpose shall, in the opinion of the Agent, be insufficient or become impaired, the Agent may call for additional indemnity and cease, or not commence, to do the action indemnified against until such additional indemnity is furnished.

18.9           Agent in its Individual Capacity.  With respect to its Commitment as a Lender, and the Loans made by it and the Note issued to it, the Agent shall have the same rights and powers hereunder and any other Loan Document as any Lender and may exercise the same as thought it were not the Agent, and the term “Lender” or “Lenders” shall, unless the context otherwise indicates, include the Agent in its individual capacity.  The Agent and its subsidiaries and affiliates may accept deposits from, lend money to, and generally engage in any kind of commercial or investment banking, trust, advisory or other business with the Borrower or any subsidiary or affiliate of the Borrower as if it were not the Agent hereunder.

18.10         Successor Agent.  The Agent may resign at any time by giving thirty (30) days’ prior written notice to the Lenders and Borrower.  The Required Lenders, for good cause, may remove Agent at any time by giving thirty (30) days’ prior written notice to the Agent, the Borrower and the other Lenders.  Upon any such resignation or removal, the Required Lenders shall have the right to appoint a successor Agent.  If no successor Agent shall have been so appointed by the Required Lenders and accepted such appoint within thirty (30) days after the retiring Agent’s giving notice of resignation or the Required Lenders’ giving notice of removal, as the case may be, then the retiring Agent may appoint, on behalf of the Borrower and the Lenders, a successor Agent.  Each such successor Agent shall be a financial institution which meets the requirements of an Eligible Assignee. Unless an Event of Default shall have occurred and be continuing, any successor Agent shall be reasonably acceptable to the Borrower.  Upon the acceptance of any appointment as Agent hereunder by a successor Agent, such successor Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Agent, and the retiring Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents.  After any retiring Agent’s resignation hereunder, the provisions of this Article 18 shall continue in effect for its benefit in respect of any actions taken or omitted to be taken by it while it was acting as the Agent hereunder.

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18.11         Duties in the Case of Enforcement.  In the case one or more Events of Default have occurred and shall be continuing, and whether or not acceleration of the Obligations shall have occurred, the Agent shall, at the request, or may, upon the consent, of the Required Lenders, and provided that the Lenders have given to the Agent such additional indemnities and assurances against expenses and liabilities as the Agent may reasonably request, proceed to enforce the provisions of this Loan Agreement and the other Loan Documents respecting the exercise of any legal or equitable rights or remedies as it may have hereunder or under any other Loan Document or otherwise by virtue of applicable law, or to refrain from so acting if similarly requested by the Required Lenders. The Agent shall be fully protected as to the Lenders in so acting or refraining from acting upon the instruction of the Required Lenders, and such instruction shall be binding upon all the Lenders. The Required Lenders may direct the Agent in writing as to the method and the extent of any such foreclosure, sale or other disposition or the exercise of any other right or remedy, the Lenders hereby agree to indemnify and hold the Agent harmless from all costs and liabilities incurred in respect of all actions taken or omitted in accordance with such direction, provided that the Agent need not comply with any such direction to the extent that the Agent reasonably believes the Agent’s compliance with such direction to be unlawful or commercially unreasonable in any applicable jurisdiction. The Agent may, in its discretion but without obligation, in the absence of direction from the Required Lenders, take such interim actions as it believes necessary to preserve the rights of the Lenders hereunder, including but not limited to petitioning a court for injunctive relief, appointment of a receiver or preservation of the proceeds of any action taken.  Each of the Lenders acknowledges and agrees that no individual Lender may separately enforce or exercise any of the provisions of any of the Loan Documents, including without limitation the Notes, other than through the Agent.

18.12         Respecting Loans and Payments.

18.12.1      Procedures for Loans.  Agent shall give written notice to each Lender of each request for a conversion of an existing Loan from a Variable Rate Advance to a Libor Advance, by facsimile transmission, hand delivery or overnight courier, not later than 11:00 a.m. (Boston time) (i) two (2) Business Days prior to any Libor Advance or conversion to a Libor Advance, or (ii) one (1) Business Day prior to any Variable Rate Advance.  Each such notice shall be accompanied by a written summary of the request for a Loan and shall specify (a) the date of the requested Loan, (b) the aggregate amount of the requested Loan, (c) each Lender’s pro rata share of the requested Loan, and (d) the applicable interest rate selected by Borrower with respect to such Loan, or any portion thereof, together with the applicable Interest Period, if any, selected, or deemed selected, by Borrower.  Each Lender shall, before 11:00 a.m. (Boston time) on the date set forth in any such request for a Loan, make available to Agent, at an account to be designated by Agent at RBS Citizens, National Association in Boston, Massachusetts, in same day funds, each Lender’s ratable portion of the requested Loan.  After Agent’s receipt of such funds and upon Agent’s determination that the applicable conditions to making the requested Loan have been fulfilled, Agent shall make such funds available to Borrower as provided for in this Loan Agreement.  Promptly after receipt by Agent of written request from any Lender, Agent shall deliver to the requesting Lender a copy of the Borrower’s request for Loans and the accompanying certifications and such other instruments, documents, certifications and approvals delivered by or on behalf of Borrower to Agent in support of the requested Loan.

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18.12.2      Nature of Obligations of Lenders.  The obligations of the Lenders hereunder are several and not joint.  Failure of any Lender to fulfill its obligations hereunder shall not result in any other Lender becoming obligated to advance more than its Commitment Percentage of the Loan, nor shall such failure release or diminish the obligations of any other Lender to fund its Commitment Percentage provided herein.

18.12.3      Payments to Agent.  All payments of principal of and interest on the Loans or the Notes shall be made to the Agent by the Borrower or any other obligor or guarantor for the account of the Lenders in immediately available funds as provided in the Notes and this Agreement.  The Agent agrees promptly to distribute to each Lender, on the same Business Day upon which each such payment is made if possible, such Lender’s proportionate share of each such payment in immediately available funds, except as otherwise expressly provided herein.  The Agent shall upon each distribution promptly notify Borrower of such distribution and each Lender of the amounts distributed to it applicable to principal of, and interest on, the proportionate share held by the applicable Lender.  Each payment to the Agent under the first sentence of this Section 18.12.3 shall constitute a payment by the Borrower to each Lender in the amount of such Lender’s proportionate share of such payment, and any such payment to the Agent shall not be considered outstanding for any purpose after the date of such payment by the Borrower to the Agent without regard to whether or when the Agent makes distribution thereof as provided above.  If any payment received by the Agent from the Borrower is insufficient to pay both all accrued interest and all principal then due and owing, the Agent shall first apply such payment to all outstanding interest until paid in full and shall then apply the remainder of such payment to all principal then due and owing, and shall distribute the payment to each Lender accordingly.

18.12.4      Distribution of Liquidation Proceeds.  Subject to the terms and conditions hereof, the Agent shall distribute all Liquidation Proceeds in the order and manner set forth below:

First:	To the Agent, towards any fees and any expenses for which the Agent is entitled to reimbursement under this Agreement or the other Loan Documents not theretofore paid to the Agent.
Second:	To all applicable Lenders in accordance with their proportional share based upon their respective Commitment Percentages until all Lenders have been reimbursed for all expenses which such Lenders have previously paid to the Agent and not theretofore paid to such Lenders.
Third:	To all applicable Lenders based upon their respective Commitment Percentages until all Lenders have been paid in full any Individual Lender Litigation Expenses.
Fourth:	To all Lenders in accordance with their proportional share based upon their respective Commitment Percentages until all Lenders have been paid in full all principal and interest due to such Lenders under the Loan, with each Lender applying such proceeds for purposes of this Agreement first against the outstanding principal balance due to such Lender under the Loan and then to accrued and unpaid interest due under the Loan.

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Fifth:

To all applicable Lenders in accordance with their proportional share based upon their respective Commitment Percentages until all Lenders have been paid in full all other amounts due to such Lenders under the Loan including, without limitation, any costs and expenses incurred directly by such Lenders to the extent such costs and expenses are reimbursable to such Lenders by the Borrower under the Loan Documents.

Sixth:

To the Borrower or such third parties as may be entitled to claim Liquidation Proceeds.

18.12.5         Adjustments.  If, after Agent has paid each Lender’s proportionate share of any payment received or applied by Agent in respect of the Loan, that payment is rescinded or must otherwise be returned or paid over by Agent, whether pursuant to any bankruptcy or insolvency law, sharing of payments clause of any loan agreement or otherwise, such Lender shall, at Agent’s request, promptly return its proportionate share of such payment or application to Agent, together with the Lender’s proportionate share of any interest or other amount required to be paid by Agent with respect to such payment or application.

18.12.6         Setoff.  If any Lender (including the Agent), acting in its individual capacity, shall exercise any right of setoff against a deposit balance or other account of the Borrower held by such Lender on account of the Obligations of the Borrower under this Agreement, such lender shall remit to the Agent all such sums received pursuant to the exercise of such right of setoff, and the Agent shall apply all such sums for the benefit of all of the Lenders hereunder in accordance with the terms of this Agreement.

18.12.7         Distribution by Agent.  If in the opinion of the Agent distribution of any amount received by it in such capacity hereunder or under the Notes or under any of the other Loan Documents might involve any liability, it may refrain from making distribution until its right to make distribution shall have been adjudicated by a court of competent jurisdiction or has been resolved by the mutual consent of all Lenders.  In addition, the Agent may request full and complete indemnity, in form and substance satisfactory to it, prior to making any such distribution.  If a court of competent jurisdiction shall adjudge that any amount received and distributed by the Agent is to be repaid, each person to whom any such distribution shall have been made shall either repay to the Agent its proportionate share of the amount so adjudged to be repaid or shall pay over to the same in such manner and to such persons as shall be determined by such court.

18.13            Delinquent Lender.  If for any reason any Lender shall fail or refuse to abide by its obligations under the Agreement, including without limitation its obligation to make available to Agent its pro rata share of any Loan, expenses or setoff (a “Delinquent Lender”) and such failure is not cured within ten (10) days of receipt from the Agent of written notice thereof, then, in addition to the rights and remedies that may be available to Agent, other Lenders, the Borrower or any other party at law or in equity, and not at limitation thereof, (i) such Delinquent Lender’s right to participate in the administration of, or decision-making rights related to, the Loans, this

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Agreement or the other Loan Documents shall be suspended during the pendency of such failure or refusal, and (ii) a Delinquent Lender shall be deemed to have assigned any and all payments due to it from the Borrower, whether on account of the outstanding Loans, interest, fees or otherwise, to the remaining non-delinquent Lenders for application to, and reduction of, their proportionate shares of the outstanding Loans until, as a result of application of such assigned payments the Lenders’ respective pro rata shares of all the outstanding Loans shall have returned to those in effect immediately prior to such delinquency and without giving effect to the nonpayment causing such delinquency.  The Delinquent Lender’s decision-making and participation rights to payments as set forth in clauses (i) and (ii) hereinabove shall be restored only upon the payment by the Delinquent Lender of its pro rata share of any Loans or expenses as to which it is delinquent, together with interest thereon at the Default Rate from the date when originally due until the date upon which any such amounts are actually paid.

The non-delinquent Lenders shall also have the right, but not the obligation, in their respective, sole and absolute discretion, to acquire for no cash consideration (pro rata, based on the respective Commitments of those Lenders electing to exercise such right) the Delinquent Lender’s Commitment to fund future Loans (the “Future Commitment”).  Upon any such purchase of the pro rata share of any Delinquent Lender’s Future Commitment, the Delinquent Lender’s share in future Loans and its rights under the Loan Documents with respect thereto shall terminate on the date of purchase, and the Delinquent Lender shall promptly execute all documents reasonably requested to surrender and transfer such interest, including, if so requested, an Assignment and Acceptance.  Each Delinquent Lender shall indemnify Agent and each non-delinquent Lender from and against any and all loss, damage or expenses, including but not limited to reasonable attorneys’ fees and funds advanced by Agent or by any non-delinquent Lender, on account of an Delinquent Lender’s failure to timely fund its pro rata share of a Loan or to otherwise perform its obligations under the Loan Documents.

18.14            Holders.  The Agent may deem and treat the payee of any Note as the owner thereof for all purposes hereof unless and until a written notice of the assignment, transfer or endorsement thereof, as the case may be, shall have been filed with the Agent.  Any request, authority or consent of any person or entity who, at the time of making such request or giving such authority or consent, is the holder of any Note shall be conclusive and binding on any subsequent holder, transferee or endorsee, as the case may be, of such Note or of any Note or Notes issued in exchange therefor.

18.15            Assignment and Participation.

18.15.1         Conditions to Assignment by Lenders.  Except as provided herein, each Lender may assign to one or more Eligible Assignees (or one or more banks or other financial institutions while an Event of Default exists) all or a portion of its interests, rights and obligations under this Agreement (including all or a portion of its Commitment Percentage and Commitment and the same portion of the Loans at the time owing to it and the Notes held by it), upon satisfaction of the following conditions: (a) each of the Agent and the Borrower shall have given its prior written consent to such assignment (provided that, in the case of the Borrower, such consent will not be unreasonably withheld and shall not be required if a Default or Event of Default shall have occurred and be continuing or if an assignment is to an Eligible Assignee), (b) each such assignment shall be of a constant, and not a varying, percentage of all the assigning Lender’s

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rights and obligations under this Agreement, (c) prior to the occurrence of an Event of Default and while same is continuing each assignment shall be in an amount that is at least Five Million Dollars ($5,000,000.00) and is a whole multiple of One Million Dollars ($1,000,000.00), (d) the parties of such assignment shall execute and deliver to the Agent, for recording in the Register (as hereinafter defined), an Assignment and Acceptance, substantially in the form of Exhibit E hereto (an “Assignment and Acceptance”), together with any Notes subject to such assignment.  Upon such execution, delivery, acceptance and recording, from and after the effective date specified in each Assignment and Acceptance, which effective date shall be at least five (5) Business Days after the execution thereof, (x) the assignee thereunder shall be a party hereto and, to the extent provided in such Assignment and Acceptance, have the rights and obligations of a Lender hereunder, and (y) the assigning Lender shall, to the extent provided in such assignment and upon payment to the Agent of the registration fee referred to in Section 18.15.3, be released from its obligations under this Agreement.

18.15.2         Certain Representations and Warranties, Limitations, Covenants.  By executing and delivering an Assignment and Acceptance, the parties to the assignment thereunder confirm to and agree with each other and the other parties hereto as follows:

(i) other than the representation and warranty that it is the legal and beneficial owner of the interest being assigned thereby free and clear of any adverse claim, the assigning Lender makes no representation or warranty, express or implied, and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with this Agreement or the execution, legality, validity, enforceability, genuineness, sufficiency or value of this Agreement, the other Loan Documents or any other instrument or document furnished pursuant hereto;

(ii) the assigning Lender makes no representation or warranty and assumes no responsibility with respect to the financial condition of the Borrower and its affiliates, related entities or subsidiaries or any other person primarily or secondarily liable in respect of any of the Obligations, or the performance or observance by the Borrower or any other person primarily or secondarily liable in respect of any of the Obligations or any of their obligations under this Agreement or any of the other Loan Documents or any other instrument or document furnished pursuant hereto or thereto;

(iii) such assignee confirms that it has received a copy of this Agreement, together with copies of the most recent financial statement provided by the Borrower as required by the terms of this Agreement, together with such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into such Assignment and Acceptance;

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(iv) such assignee will, independently and without reliance upon the assigning Lender, the Agent or any other Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under this Agreement;

(v) such assignee represents and warrants that it is an Eligible Assignee if required hereunder;

(vi) such assignee appoints and authorizes the Agent to take such action as agent on its behalf and to exercise such powers under this Agreement and the other Loan Documents as are delegated to the Agent by the terms hereof or thereof, together with such powers as are reasonably incidental thereto;

(vii) such assignee agrees that it will perform in accordance with their terms all of the obligations that by the terms of this Agreement are required to be performed by it as a Lender; and

(viii) such assignee represents and warrants that it is legally authorized to enter into such Assignment and Acceptance.

18.15.3         Register.  The Agent shall maintain a copy of each Assignment and Acceptance delivered to it and a register or similar list (the “Register”) for the recordation of the names and addresses of the Lenders and the Commitment Percentage of, and principal amount of the Loans owing to the Lenders from time to time.  The entries in the Register shall be conclusive, in the absence of manifest error, and the Borrower, the Agent and the Lenders may treat each person whose name is recorded in the Register as a Lender hereunder available for inspection by the Borrower and the Lenders at any reasonable time and from time to time upon reasonable prior notice.  Upon each such recordation, the assigning Lender agrees to pay to the Agent a registration fee in the sum of Three Thousand Five Hundred Dollars ($3,500.00).

18.15.4         New Notes.  Upon its receipt of an Assignment and Acceptance executed by the parties to such assignment, together with each Note subject to such assignment, the Agent shall (a) record the information contained therein in the Register, and (b) give prompt notice thereof to the Borrower and the Lenders (other than the assigning Lender).  Within five (5) Business Days after receipt of such notice, the Borrower, at its own expense, shall execute and deliver to the Agent, in exchange for each surrendered Note, a new Note to the order of such Eligible Assignee pursuant to such Assignment and Acceptance and, if the assigning Lender has retained some portion of its obligations hereunder, a new Note to the order of the assigning Lender in an amount equal to the amount retained by it hereunder.  Such new Notes shall provide that they are replacements for the surrendered Notes, shall be in an aggregate principal amount equal to the aggregate principal amount of the surrendered Notes, shall be dated the effective date of such Assignment and Acceptance and shall otherwise be substantially in the form of the assigned Notes.  The surrendered Notes shall be canceled and returned to the Borrower.

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18.15.5         Participations.  Each Lender may sell participations to one or more banks or other financial institutions in all or a portion of such Lender’s rights and obligations under this Agreement and the other Loan Documents; provided that (a) each such Participation shall be in a minimum amount of Five Million Dollars ($5,000,000.00), (b) as long as no Event of Default exists each participant shall meet the requirements of an Eligible Assignee, (c) any such sale or participation shall not affect the rights and duties of the selling Lender hereunder to the Borrower, and (d) the only rights granted to the participant pursuant to such participation arrangements with respect to waivers, amendments or modifications of the Loan Documents shall be the rights to approve waivers, amendments or modifications that would reduce the principal of or the interest rate on any Loans, extend the term or increase the amount of the Commitment of such Lender as it relates to such participant, reduce the amount of any commitment fees to which such participant is entitled or extend any regularly scheduled payment date for principal or interest.

18.16            Disclosure.  The Borrower agrees that in addition to disclosures made in accordance with standard and customary banking practices any Lender may disclose information obtained by such Lender pursuant to this Agreement to assignees or participants and potential assignees or participants hereunder; provided that such assignees or participants or potential assignees or participants shall agree (a) to treat in confidence such information unless such information otherwise becomes public knowledge, (b) not to disclose such information to a third party except as required by law or legal process and (c) not to make use of such information for purposes of transactions unrelated to such contemplated assignment or participation.  The Agent and the Lenders agree to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to it and its affiliates’ directors, officers, employees and agents, including accountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential), (b) to the extent requested by any regulatory authority, (c) to the extent required by applicable laws or regulations or by any subpoena or similar legal process, (d) to any other party hereto, (e) in connection with the exercise of any remedies hereunder or under any other Loan Document or any action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder, (f) subject to an agreement containing provisions substantially the same as those of this Section, to (i) any assignee of or participant in, or any prospective assignee of or participant in, any of its rights or obligations under this Agreement or (ii) any actual or prospective counterparty (or its advisors) to any Hedging Contract, (g) with the written consent of the Borrower or (h) to the extent such Information (x) becomes publicly available other than as a result of a breach of this Section or (y) becomes available to the Agent or the Lenders on a nonconfidential basis from a source other than the Borrower.  For purposes of this Section, “Information” means all information received from the Borrower relating to the Borrower or any of its businesses, other than any such information that is available to the Agent or the Lenders on a nonconfidential basis prior to disclosure by the Borrower, provided that, in the case of information received from the Borrower after the date hereof, such information either (x) consists of financial statements or (y) is clearly identified at the time of delivery as confidential.  Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.

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AGENT AND EACH LENDER ACKNOWLEDGES THAT INFORMATION FURNISHED TO IT PURSUANT TO THIS AGREEMENT MAY INCLUDE MATERIAL NON-PUBLIC INFORMATION CONCERNING THE BORROWER OR ITS RESPECTIVE SECURITIES, AND CONFIRMS THAT IT HAS DEVELOPED COMPLIANCE PROCEDURES REGARDING THE USE OF MATERIAL NON-PUBLIC INFORMATION AND THAT IT WILL HANDLE SUCH MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH THOSE PROCEDURES AND APPLICABLE LAW, INCLUDING FEDERAL AND STATE SECURITIES LAWS.

18.17            Miscellaneous Assignment Provisions.  Any assigning Lender shall retain its rights to be indemnified pursuant to Section 14 with respect to any claims or actions arising prior to the date of such assignment.  If any assignee Lender is not incorporated under the laws of the United States of America or any state thereof, it shall prior to the date on which any interest or fees are-payable hereunder or under any of the other Loan Documents for its account, deliver to the Borrower and the Agent certification as to its exemption from deduction or withholding of any United States federal income taxes.  Anything contained in this Section 18.17 to the contrary notwithstanding, any Lender may at any time pledge all or any portion of its interest and rights under this Agreement (including all or any portion of its Notes to any of the twelve Federal Reserve Banks organized under §4 of the Federal Reserve Act, 12 U.S.C.§341).  No such pledge or the enforcement thereof shall release the pledgor Lender from its obligations hereunder or under any of the other Loan Documents.

18.18            Amendment, Waiver, Consent, Etc.  No term or provision of this Agreement or any other Loan Document may be changed, waived, discharged or terminated, nor may any consent required or permitted by this Agreement or any other Loan Document be given, unless such change, waiver, discharge, termination or consent receives the written approval of the Required Lenders, unless the Agent is specifically allowed to give such consent, amendment or waiver pursuant to the terms hereof.  The Borrower shall be required to give its written consent to any amendment of this Agreement and the Loan Documents.

Notwithstanding the foregoing, written approval from a Supermajority of Lenders (other than a Delinquent Lender) shall be required with respect to any proposed amendment, waiver, discharge, termination, or consent which:

(i) results in Borrower creating, incurring, assuming or guarantying any new Indebtedness other than as permitted under Section 10.2 of this Agreement; or

(ii) amends, modifies or waives any of the financial covenants set forth in Section 10.8 of this Agreement.

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Additionally, notwithstanding the foregoing, the unanimous written approval of all the Lenders (other than a Delinquent Lender) shall be required with respect to any proposed amendment, waiver, discharge, termination, or consent which:

(i) has the effect of (a) extending the final scheduled maturity or the date of any amortization payment of any Loan or Note, (b) reducing the rate or extending the time of payment of interest or fees thereon, (c) increasing or reducing the principal amount thereof, or (d) otherwise postponing or forgiving any indebtedness thereunder,

(ii) amends, modifies or waives any provisions of this paragraph.

(iii) changes the percentage specified in the definition of Required Lenders or Supermajority of Lenders,

(iv) except as otherwise provided in this Agreement, change the amount of any Lender’s Commitment or Commitment Percentage, or

(v) releases or waives any of the indemnifications provided in the Loan Documents;

and provided, further, that without the consent of the Agent, no such action shall amend, modify or waive any provision of this Article 18.18 or any other provisions of any Loan Document which relates to the rights or obligations of the Agent.

18.19            Deemed Consent or Approval.  With respect to any requested amendment, waiver, consent or other action which requires the approval of the Required Lenders or all of the Lenders, as the case may be in accordance with the terms of this Agreement, or if the Agent is required hereunder to seek or desires to seek, the approval of the Required Lenders or all of the Lenders, as the case may be, prior to undertaking a particular action or course of conduct, the Agent in each such case shall provide each Lender with written notice of any such request for amendment, waiver or consent or any other requested or proposed action or course of conduct, accompanied by such detailed background information and explanations as may be reasonably necessary to determine whether to approve or disapprove such amendment, waiver, consent or other action or course of conduct, the Agent may (but shall not be required to) include in any such notice, printed in capital letters or boldface type a legend substantially to the following effect;

“THIS COMMUNICATION REQUIRES IMMEDIATE RESPONSE, FAILURE TO RESPOND WITHIN TEN (10) CALENDAR DAYS FROM THE RECEIPT OF THIS COMMUNICATION SHALL CONSTITUTE A DEEMED APPROVAL BY THE ADDRESSEE OF THE ACTION REQUESTED BY THE BORROWER OR THE COURSE OF CONDUCT PROPOSED BY THE AGENT AND RECITED ABOVE.”

and if the foregoing legend is included by the Agent in its communication, a Lender shall be deemed to have approved or consented to such action or course of conduct for all purposes hereunder if such Lender fails to object to such action or course of conduct by written notice to the Agent within ten (10) calendar days of such Lender’s receipt of such notice.

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19.           NO ASSIGNMENT BY THE BORROWER.  The Borrower shall not assign or transfer any of its rights or obligations under any of the Loan Documents without the prior approval of the Lenders.

20.           RELATIONSHIP.  The relationship between the Lenders and the Borrower is solely that of a lender and borrower, and nothing contained herein or in any of the other Loan Documents shall in any manner be construed as making the parties hereto partners, joint venturers or any other relationship other than lender and borrower.

21.           NOTICES.  Except as otherwise provided herein or in any other Loan Document, each notice, demand, election or request provided for or permitted to be given pursuant to this Agreement (hereinafter in this Section referred to as “Notice”) must be in writing and shall be deemed to have been properly given or served by personal delivery or by sending same by overnight courier, by depositing same in the United States Mail, postpaid and registered or certified, return receipt requested, or by facsimile transmission, and addressed as follows:

If to the Agent:

RBS Citizens, National Association

28 State Street

Boston, Massachusetts 02109

Attention:  Mr. Daniel R. Ouellette

     Senior Vice President

Facsimile: (617) 725-5695

with a copy to:

Goulston & Storrs, P.C.

400 Atlantic Avenue

Boston, Massachusetts 02110

Attention:  James H. Lerner, Esq.

Facsimile: (617) 574-7607

If to the Borrower:

Franklin Street Properties Corp.

401 Edgewater Place

Suite 200

Wakefield, Massachusetts 01880-6210

Attention:  John G. Demeritt

Facsimile: (781) 246-2807

with a copy to:

Wilmer, Cutler, Pickering, Hale and Dorr LLP

60 State Street

Boston, Massachusetts 02109

Attention:  Kenneth A. Hoxsie, Esq.

Facsimile: (617) 526-5000

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If to the Lenders:

RBS Citizens, National Association

28 State Street

Boston, Massachusetts 02109

Attention:  Mr. Daniel R. Ouellette

     Senior Vice President

Facsimile: (617) 725-5695

Bank of America, N.A.

One Federal Street

Boston, Massachusetts 02110

Attention:  Mr. Israel Lopez

     Senior Vice President

Facsimile: (617) 346-5025

Wachovia Bank, National Association

Real Estate Asset Management

190 River Road (NJ3411)

Summit, New Jersey 07901

Attention: Mr. Louis Ricchione

Facsimile:  (908) 598-3617

with a copy to:

Goulston & Storrs, P.C.

400 Atlantic Avenue

Boston, Massachusetts  02110

Attention:  James H. Lerner, Esq.

Facsimile: (617) 574-7607

or to such other Lenders as provided in the Assignment and Acceptance.

Each Notice shall be effective upon being personally delivered, receipt of facsimile transmission or upon being sent by overnight courier or upon being deposited in the United States Mail as aforesaid.  However, (i) the time period in which a response to such Notice must be given or any action taken with respect thereto (if any), and (ii) the commencement of a default period, to the extent notice is required hereunder, shall commence to run from the date of receipt if personally delivered, sent by facsimile transmission, or sent by overnight courier, or if so deposited in the United States Mail, the earlier of three (3) Business Days following such deposit or the date of receipt as disclosed on the return receipt.  Rejection or other refusal to accept or the inability to deliver because of changed address for which no Notice was given shall be deemed to be receipt of the Notice sent.  By giving at least thirty (30) days’ prior Notice thereof, the Borrower or the Lender shall have the right from time to time and at any time during the term of this Agreement to change their respective addresses and each shall have the right to specify as its address any other address within the United States of America.

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22.           GOVERNING LAW.  This Agreement and each of the other Loan Documents, except as otherwise specifically provided therein, are contracts under the laws of the Commonwealth of Massachusetts and shall for all purposes be construed in accordance with and governed by the laws of said Commonwealth (excluding the laws applicable to conflicts or choice of law).

23.           CONSENT TO JURISDICTION; WAIVERS.  THE BORROWER, AGENT AND THE LENDERS EACH HEREBY IRREVOCABLY AND UNCONDITIONALLY (A) SUBMIT TO NONEXCLUSIVE PERSONAL JURISDICTION IN THE COMMONWEALTH OF MASSACHUSETTS OVER ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS, AND (B) WAIVE ANY AND ALL PERSONAL RIGHTS UNDER THE LAWS OF ANY STATE (I) TO THE RIGHT, IF ANY, TO TRIAL BY JURY, (II) TO OBJECT TO JURISDICTION WITHIN THE COMMONWEALTH OF MASSACHUSETTS OR VENUE IN ANY PARTICULAR FORUM WITHIN THE COMMONWEALTH OF MASSACHUSETTS, AND (III) TO THE RIGHT, IF ANY, TO CLAIM OR RECOVER ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN ACTUAL DAMAGES.  THE BORROWER, AGENT AND THE LENDERS EACH AGREE THAT, IN ADDITION TO ANY METHODS OF SERVICE OF PROCESS PROVIDED FOR UNDER APPLICABLE LAW, ALL SERVICE OF PROCESS IN ANY SUCH SUIT, ACTION OR PROCEEDING MAY BE MADE BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED DIRECTED TO THE BORROWER, AGENT AND THE LENDERS AT THE ADDRESSES SET FORTH IN §21 ABOVE, AND SERVICE SO MADE SHALL BE COMPLETE FIVE (5) DAYS AFTER THE SAME SHALL BE SO MAILED.  NOTHING CONTAINED HEREIN, HOWEVER, SHALL PREVENT THE AGENT AND THE LENDERS FROM BRINGING ANY SUIT, ACTION OR PROCEEDING OR EXERCISING ANY RIGHTS AGAINST THE BORROWER, AND AGAINST ANY PROPERTY OF THE BORROWER, IN ANY OTHER STATE.  INITIATING SUCH SUIT, ACTION OR PROCEEDING OR TAKING SUCH ACTION IN ANY STATE SHALL IN NO EVENT CONSTITUTE A WAIVER OF THE AGREEMENT CONTAINED HEREIN THAT THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS SHALL GOVERN THE RIGHTS AND OBLIGATIONS OF THE BORROWER, AGENT AND THE LENDERS HEREUNDER OR THE SUBMISSION HEREIN BY THE BORROWER TO NONEXCLUSIVE PERSONAL JURISDICTION WITHIN THE COMMONWEALTH OF MASSACHUSETTS.

24.           PREFERENCES.  Agent and Lenders shall have no obligation to marshal any assets in favor of Borrower or any other party or against or in payment of any or all of the obligations of Borrower pursuant to this Agreement, the Note or any other Loan Document.  Lenders shall have the continuing and exclusive right to apply or reverse and reapply any and all payments by Borrower to any portion of such obligations.  To the extent Borrower makes a payment or payments to Lenders for Borrower’s benefit, which payment or proceeds or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside or required to be repaid to a trustee, receiver or any other Person under any bankruptcy law, state or federal law, the obligations or part thereof intended to be satisfied shall be revived and continue in full force and effect, as if such payment or proceeds had not been received by Lenders.

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25.           RULES OF INTERPRETATION.  The following rules of interpretation shall govern:

(a) A reference to any Loan Document, agreement, budget, document or schedule shall include such agreement, budget, document or schedule as revised, amended, modified or supplemented from time to time in accordance with its terms and the terms of this Agreement.

(b) A reference to any Exhibit hereto shall be deemed to specifically incorporate the terms and provisions of such Exhibit herein.

(c) The singular includes the plural and the plural includes the singular.

(d) A reference to any law includes any amendment or modification to such law.

(e) A reference to any Person includes its permitted successors and permitted assigns.

(f) Accounting terms not otherwise defined herein have the meaning assigned to them by generally accepted accounting principles applied on a consistent basis by the accounting entity to which they refer.

(g) The words “approval” and “approved”, as the context so determines, means an approval in writing given to the Person seeking approval after full and fair disclosure to the Person giving approval of all material facts necessary in order to determine whether approval should be granted.

(h) Reference to a particular “§” refers to that Section of this Agreement unless otherwise indicated.

(i) Use of the word “including” shall mean “including, without limitation” unless the context otherwise requires.

(j) The term Borrower shall be deemed to include each Borrower individually and collectively and all definitions, representations, warranties, covenants, rights and remedies provided for herein apply to each entity individually and collectively except as the context otherwise provides.  Further, any and all references to Obligations shall mean and refer to the joint Obligations of each entity to the Lender.  Any and all Advances hereunder shall be advanced to one of the entities but shall represent an Obligation of all of the entities to the Lenders.

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26.           HEADINGS.  The captions in this Agreement are for convenience of reference only and shall not define or limit the provisions hereof.

27.           COUNTERPARTS.  This Agreement and any amendment hereof may be executed in several counterparts and by each party on a separate counterpart, each of which when so executed and delivered shall be an original, and all of which together shall constitute one instrument.  In proving this Agreement it shall not be necessary to produce or account for more than one such counterpart signed by the party against whom enforcement is sought.

28.           ENTIRE AGREEMENT. The Loan Documents and any other documents executed in connection herewith or therewith express the entire understanding of the parties with respect to the transactions contemplated hereby.  Neither this Agreement nor any term hereof may be changed, waived, discharged or terminated, except as provided in §18.18.

29.           TIME OF THE ESSENCE.  Time is of the essence with respect to each and every covenant, agreement and obligation of the Borrower under this Agreement and the other Loan Documents.

30.           SEVERABILITY.  The provisions of this Agreement are severable, and if any one clause or provision hereof shall be held invalid or unenforceable in whole or in part in any jurisdiction, then such invalidity or unenforceability shall affect only such clause or provision, or part thereof, in such jurisdiction, and shall not in any manner affect such clause or provision in any other jurisdiction, or any other clause or provision of this Agreement in any jurisdiction.

31.           CUSTOMER IDENTIFICATION - USA PATRIOT ACT NOTICE; OFAC AND BANK SECRECY ACT.  The Agent hereby notifies the Borrower that pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56, signed into law October 26, 2001) (the "Act"), and the Agent's policies and practices, the Agent is required to obtain, verify and record certain information and documentation that identifies the Borrower, which information includes the name and address of the Borrower and such other information that will allow the Agent to identify the Borrower in accordance with the Act.  In addition, the Borrower shall (a) ensure that no person who owns a controlling interest in or otherwise controls the Borrower or any subsidiary of the Borrower is or shall be listed on the Specially Designated Nationals and Blocked Person List or other similar lists maintained by the Office of Foreign Assets Control ("OFAC"), the Department of the Treasury or included in any Executive Orders as a blocked person, (b) not use or permit the use of the proceeds of the Loan to violate any of the foreign asset control regulations of OFAC or any enabling statute or Executive Order relating thereto, and (c) comply, and cause any of its subsidiaries to comply, with all applicable Bank Secrecy Act ("BSA") laws and regulations, as amended.

[The remainder of this page is intentionally left blank.]

53

IN WITNESS WHEREOF, the undersigned have duly executed this Agreement as a sealed instrument as of the date first set forth above.

WITNESS /s/ Scott H. Carter	FRANKLIN STREET PROPERTIES CORP., a Maryland corporation By:        /s/ George J. Carter Name: George J. Carter Title: President and Chief Executive Officer
	FSP HOLDINGS LLC, a Delaware limited liability company By:     /s/ George J. Carter Name: George J. Carter Title: President and Chief Executive Officer
	FSP INVESTMENTS LLC, a Massachusetts limited liability company By:     /s/ George J. Carter Name: George J. Carter Title: President
	FSP PROPERTY MANAGEMENT LLC, a Massachusetts limited liability company By:     /s/ George J. Carter Name: George J. Carter Title: Executive Vice President
	FSP PROTECTIVE TRS CORP., a Massachusetts corporation By:     /s/ George J. Carter Name: George J. Carter Title: President

54

FSP HILLVIEW CENTER LIMITED PARTNERSHIP,

a Massachusetts limited partnership

By:       FSP Holdings LLC, its General Partner

By:    /s/ George J. Carter

Name: George J. Carter

Title: President and Chief Executive

Officer

FSP MONTAGUE BUSINESS CENTER CORP.,

a Delaware corporation

By:     /s/ George J. Carter

Name: George J. Carter

Title: President

FSP GREENWOOD PLAZA CORP.,

a Delaware corporation

By:     /s/ George J. Carter

Name: George J. Carter

Title: President

FSP 380 INTERLOCKEN CORP.,

a Delaware corporation

By:     /s/ George J. Carter

Name: George J. Carter

Title: President

FSP 390 INTERLOCKEN LLC,

a Delaware limited liability company

By:     /s/ George J. Carter

Name: George J. Carter

Title: President

55

FSP BLUE LAGOON DRIVE LLC,

a Delaware limited liability company

By:     /s/ George J. Carter _

Name: George J. Carter

Title: President

FSP ONE OVERTON PARK LLC,

a Delaware limited liability company

By:     /s/ George J. Carter

Name: George J. Carter

Title: President

FSP NORTHWEST POINT LLC,

a Delaware limited liability company

By:     /s/ George J. Carter

Name: George J. Carter

Title: President

FSP RIVER CROSSING LLC,

a Delaware limited liability company

By:     /s/ George J. Carter

Name: George J. Carter

Title: President

FSP BOLLMAN PLACE LIMITED PARTNERSHIP,

a Massachusetts limited partnership

By:     FSP Holdings LLC, its General Partner

By:     /s/ George J. Carter

Name: George J. Carter

Title: President and Chief Executive Officer

56

FSP SOUTHFIELD CENTRE LIMITED PARTNERSHIP,

a Massachusetts limited partnership

By:     FSP Holdings LLC, its General Partner

By:     /s/ George J. Carter

Name: George J. Carter

Title: President and Chief Executive Officer

FSP FOREST PARK IV NC LIMITED PARTNERSHIP,

a North Carolina limited partnership

By:     FSP Forest Park IV LLC, its General Partner

By:     /s/ George J. Carter

Name: George J. Carter

Title: President

FSP PARK SENECA LIMITED PARTNERSHIP,

a Massachusetts limited partnership

By:     FSP Holdings LLC, its General Partner

By:     /s/ George J. Carter

Name: George J. Carter

Title: President and Chief Executive Officer

FSP ADDISON CIRCLE LIMITED PARTNERSHIP,

a Texas limited partnership

By:     FSP Addison Circle LLC, its General Partner

By:     /s/ George J. Carter

Name: George J. Carter

Title: President

57

FSP PARK TEN PHASE II LIMITED PARTNERSHIP,

a Texas limited partnership

By:     FSP Park Ten Development LLC, its General Partner

By:     /s/ George J. Carter

Name: George J. Carter

Title: President

FSP COLLINS CROSSING LIMITED PARTNERSHIP,

a Texas limited partnership

By:     FSP Collins Crossing LLC, its General Partner

By:     /s/ George J. Carter

Name: George J. Carter

Title: President

FSP ELDRIDGE GREEN LIMITED PARTNERSHIP,

a Texas limited partnership

By:     FSP Eldridge Green LLC, its General Partner

By:     /s/ George J. Carter

Name: George J. Carter

Title: President

FSP LIBERTY PLAZA LIMITED PARTNERSHIP,

a Texas limited partnership

By:     FSP Holdings LLC, its General Partner

By:     /s/ George J. Carter

Name: George J. Carter

Title: President and Chief Executive Officer

58

FSP PARK TEN LIMITED PARTNERSHIP,

a Texas limited partnership

By:     FSP Park Ten LLC, its General Partner

By:     /s/ George J. Carter

Name: George J. Carter

Title: President

FSP WILLOW BEND OFFICE CENTER LIMITED PARTNERSHIP,

a Texas limited partnership

By:     FSP Willow Bend Office Center LLC, its General Partner

By:     /s/ George J. Carter

Name: George J. Carter

Title: President

FSP INNSBROOK CORP,

a Delaware corporation

By:     /s/ George J. Carter

Name: George J. Carter

Title: President

FSP EAST BALTIMORE STREET LLC,

a Delaware limited liability company

By:     /s/ George J. Carter

Name: George J. Carter

Title: President

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RBS CITIZENS, NATIONAL ASSOCIATION,

Agent and Lender

By:       /s/ Daniel R. Ouellette 

Name:  Daniel R. Ouellette

Title:  Senior Vice President

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BANK OF AMERICA, N.A., Lender

By:       /s/ Israel Lopez 

Name:  Israel Lopez

Title:  Senior Vice President

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WACHOVIA BANK, NATIONAL ASSOCIATION, Lender

By:       /s/ Louis M. Ricchione 

Name:  Louis M. Ricchione

Title:  Vice President

   Real Estate Asset Management

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EXHIBIT A

JOINDER AGREEMENT

___________, _______

Reference is made to the Term Loan Agreement, dated as of October 15, 2008 (as amended on the date hereof and as from time to time further amended and in effect, the “Loan Agreement”), among Franklin Street Properties Corp. (“FSP”), those other Borrowers listed on Schedule 2 (as amended) of the Loan Agreement and each other Borrower (collectively, the “Borrower”) which from time to time is a party to the Loan Agreement, and RBS Citizens, National Association as agent (the “Lender”).  Capitalized terms used herein and not otherwise defined shall have the meanings assigned to such terms in the Loan Agreement.

In consideration of and as an inducement to the Lender continuing to provide financing under the Loan Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, ________________________ (the “Additional Borrower”), a Wholly Owned Subsidiary of FSP, hereby acknowledges and agrees to the terms and conditions of the Loan Agreement and the Note, joins in the agreements of the Borrower under the Loan Agreement and the Note and agrees that all Obligations of the Borrower under the Loan Agreement and the Note shall be the obligations, jointly and severally, of the Additional Borrower with the same force and effect as if the Additional Borrower was originally a Borrower under the Loan Agreement and an original signatory to the Loan Agreement and the Note.  Furthermore, the Additional Borrower shall have all the liabilities and obligations of a maker under the Note.

The Additional Borrower further agrees that its liability hereunder is direct and primary and may be enforced by the Lender before or after proceeding against any other Borrower.

The Additional Borrower shall deliver to the Lender, with respect to such Additional Borrower’s property(ies), current and historical financial statements reasonably requested by Lender with respect to the Additional Borrower, within five (5) Business Days of any such request.  Such statements shall not be subject to Lender’s approval or satisfaction.

Exhibit A-1

The undersigned hereby represents and warrants to the Lender that it has the complete right, power and authority to execute and deliver this Joinder Agreement and, to perform all of the obligations hereunder and the Obligations under the Loan Agreement and the Note.  This Joinder Agreement shall be binding upon the undersigned and its successors and assigns and shall inure to the benefit of the Lender and its successors and assigns.

Executed as a sealed instrument as of the __ day of __________, ______.

___________________________________

By: ________________________________

Its: ________________________________

By: __________________________

Name: _________________

Its: ____________________

Acknowledged and Agreed:

Franklin Street Properties Corp., as agent for each Borrower

By:  _____________________(SEAL)

Exhibit A-2

SCHEDULE 1

DEFINITIONS

Acquisition.  The acquisition (by merger, consolidation, direct purchase or otherwise) by FSP, or a Wholly Owned Subsidiary, of ownership of real property, including without limitation the acquisition of preferred stock interests or other similar interests in an owner of real property established or sponsored by FSP, the Borrower, or an affiliate.

Adjusted Libor Rate.  The term “Adjusted Libor Rate” means a per annum rate equal at all times to the greater of (i) Libor Lending Rate plus two hundred (200) basis points or (ii) four (4%) percent per annum.

Advance.  Any disbursement of the proceeds of the Loan made or to be made by the Lenders pursuant to the terms of this Agreement.

Affiliate Disposition.  Any transaction whereby a Borrower, or an affiliate, transfers or sells property owned by it to a Syndication REIT, and such Syndication REIT transfers or sells shares of preferred stock or similar interests in such Syndication REIT to such Borrower or affiliate.

Agent.  Citizens, acting as agent for the Lenders.

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

Asbestos-Containing Materials.  Shall mean any material containing any asbestos or presumed to contain asbestos at levels regulated under applicable Environmental Laws.

Balance Sheet Date.  December 31, 2007.

Baltimore Property.  The office property located at 120 East Baltimore Street, Baltimore, Maryland.

Banking Day.  The term “Banking Day” means any day other than a Saturday, Sunday, legal holiday, or a day on which banks are not required or authorized by law to close in the city in which Agent’s principal office is situated.

BOA.  Bank of America, N.A.

Borrower.  As defined in the preamble hereto.  All definitions, representations, warranties, covenants, rights and remedies provided for herein apply to each entity individually and collectively except as the context otherwise provides.  Further, any and all references to Obligations shall mean and refer to the joint Obligations of each entity to the Lender.  Any and all Advances hereunder shall be advanced to one of the entities but shall represent an Obligation of all of the entities to the Lenders.

Schedule 1 - - 1

Business Day.

(a)           any day which is neither a Saturday or Sunday nor a legal holiday on which commercial banks are authorized or required to be closed in Boston, Massachusetts;

(b)           when such term is used to describe a day on which a borrowing, payment, prepaying, or repaying is to be made in respect of any LIBOR Advance, any day which is: (i) neither a Saturday or Sunday nor a legal holiday on which commercial banks are authorized or required to be closed in New York City; and (ii) a London Banking Day; and

(c)           when such term is used to describe a day on which an interest rate determination is to be made in respect of any LIBOR Advance, any day which is a London Banking Day.

CBD Properties.  Property or properties located in the downtown section of a city, generally consisting of retail, office, hotel, entertainment and governmental land uses with some high density housing.  As of the date hereof, the Baltimore Property is a CBD Property.

Citizens.  RBS Citizens, National Association.

Closing Date.  The first date on which the conditions set forth in §6 have been satisfied.

Co-Agent.  BOA.

Code.  The Internal Revenue Code of 1986 and the regulations thereunder, all as amended and in effect from time to time.

Commitment.  With respect to each Lender, the amount set forth on Exhibit F hereto as the amount of such Lender’s commitment to make advances to the Borrower, as may be amended from time to time by the Agent as provided in Section 18.

Commitment Percentage.  With respect to each Lender, the percentage set forth on Exhibit F hereto as such Lender’s percentage of the aggregate Commitments of all of the Lenders, as may be amended from time to time by the Agent as provided in Section 18.

Consolidated Indebtedness.  After elimination of duplication, for the Borrower, all obligations, contingent and otherwise, that in accordance with generally accepted accounting principles should be classified upon the obligor’s balance sheet as liabilities, or to which reference should be made by footnotes thereto, including in any event and whether or not so classified:  (a) all debt and similar monetary obligations including all outstanding letters of credit; (b) all liabilities secured by any mortgage, pledge, security interest, lien, charge, or other encumbrance existing on property owned or acquired subject thereto, whether or not the liability secured thereby shall have been assumed; (c) all liabilities under capitalized leases; (d) all guaranties, endorsements and other contingent obligations whether direct or indirect in respect of Indebtedness of others, including the obligations to reimburse the issuer in respect of any letters of credit, and (e) all unsecured Indebtedness.

Schedule 1 - - 2

Consolidated Total Asset Value.  The value of all properties owned by the Borrower or subsidiaries by utilizing a 8.25% capitalization rate (7% for CBD Properties) based on the most recent quarter’s Net Operating Income from all properties owned by the Borrower times 4, plus the book value of all other tangible assets (including stock and mortgage Syndication REITS).  In addition, in determining Consolidated Total Asset Value for the first 12 months after an acquisition, the Borrower may include such newly acquired property at either the cost basis value or the capitalization rate value.  Further, in valuing development properties, and at Borrower’s election, either a cost basis value or a capitalization rate (annualized as appropriate) value will be applied to such properties based on the most recent quarter’s Net Operating Income times 4.

Debt Service Charges.  For any fiscal period of the Borrower, without duplication, the sum of the expenses of the Borrower for such period for (x) Debt Service on Floating Rate Debt, (y) Debt Service on Fixed Rate Debt, and (z) fees payable in connection with any other Consolidated Indebtedness secured by all or any part of the Properties in each case determined in accordance with generally accepted accounting principles.

Debt Service Charges on Unencumbered Properties.  Shall  mean, for any fiscal period of the Borrower, without duplication, the sum of the expenses of the Borrower for such period for (x) Unsecured Floating Rate Debt Service, (y) Unsecured Fixed Rate Debt Service, and (z)  fees payable in connection with any other unsecured Indebtedness for borrowed money of the Borrower, in each case determined in accordance with generally accepted accounting principles.

Debt Service on Fixed Rate Debt.  Shall mean the principal and interest payable for the applicable reporting period on (x)  the outstanding Loans hereunder (up to the principal amount of the Loan Amount) plus (y) any other Indebtedness (including any Indebtedness which by its terms is calculated at a floating rate but which is hedged pursuant to interest rate swap contracts) for borrowed money with respect to which the interest rate is fixed for three or more years based on the original term of such Indebtedness, in each case determined in accordance with generally accepted accounting principles.

Debt Service on Floating Rate Debt.  Shall mean the principal and interest payable on the outstanding loan balance of any Indebtedness bearing interest at a floating rate (excluding any Indebtedness which by its terms is calculated at a floating rate but which is hedged pursuant to interest rate swap contracts, for example the Indebtedness under this Agreement) for the applicable reporting period.  Debt Service on Floating Rate Debt shall be calculated based upon the greater of: (i) the actual interest rate in effect under the applicable loan for the test period plus principal payments based upon a twenty (20) year amortization schedule, or (ii) the greater of (I) the rate for the ten (10) year United States Treasury obligations in amounts approximating the principal balance of the Loan during the test period plus one hundred eighty five (185) basis points, or (II) seven and one-half percent (7.5%) per annum, plus in the case of (I) and (II), principal payments based upon a twenty (20) year amortization schedule.

Default.  A condition or event which would, with either the giving of notice or lapse of time or both, constitute an Event of Default.

Default Rate.  See §2.5.

Schedule 1 - - 3

Distribution.  The (i) declaration or payment of any dividend, (ii) distribution of cash or other property, (iii) purchase, redemption, or other retirement (directly or indirectly), (iv) repayment of any loan to any Person directly or indirectly holding an interest in Borrower, or (iv) other distribution, in each case, of, on or in respect of any shares of any class of capital stock, partnership interests, or other beneficial or ownership interests of the Borrower.

Drawdown Date.  The date that an Advance is made hereunder.

Eligible Assignee.  Any of (a) a commercial bank organized under the laws of the United States, or any State thereof or the District of Columbia. and having total assets in excess of $1,000,000,000; (b) a savings and loan association or savings bank organized under the laws of the United States, or any State thereof or the District of Columbia, and having a net worth of at least $100,000,000, calculated in accordance with generally accepted accounting principles; (c) a commercial bank organized under the laws of any other country which is a member of the organization for Economic Cooperation and Development (the “OECD”), or a political subdivision of any such country, and having total assets in excess of $1,000,000,000, provided that such bank is acting through a branch or agency located in the country in which it is organized or another country which is also a member of the OECD; (d) the central bank of any country which is a member of the OECD; and (e) any Lender.

Environmental Laws.  Shall mean the portions of any and all applicable federal, state and local statutes, regulations and ordinances pertaining to Hazardous Substances or Asbestos-Containing Materials or both.

Environmental Report(s).  The environmental site assessment reports and any supplemental reports, test and materials furnished  to the Agent.

ERISA Plan.  Any employee benefit, employee pension, or multiemployer plan within the meaning of the Employee Retirement Income Security Act of 1974, as amended and in effect from time to time.

Event of Default.  See §11.

Executive Order. Executive Order No. 13224, 66 Fed. Reg. 49079 published September 25, 2001  or any other similar executive orders.

Extended Maturity Date.  See §2.8.

Extended Term.  See §2.8.

Extension Period.  See §2.8.

FSP.  As defined in the Preamble.

Fee Letter.  Means the fee letter of even date between the Agent and the Borrower, as may be amended from time to time.

First Extension Period.  See §2.8.

Schedule 1 - - 4

Future Commitment as defined in Section 18.13.

Generally Accepted Accounting Principles or GAAP.  Principles that are (a) consistent with the principles promulgated or adopted by the Financial Accounting Standards Board and its predecessors, as in effect from time to time and (b) consistently applied with past financial statements of the Borrower adopting the same principles; provided that a certified public accountant would, insofar as the use of such accounting principles is pertinent, be in a position to deliver an unqualified opinion (other than a qualification regarding changes in generally accepted accounting principles) as to financial statements in which such principles have been properly applied.

Government Authority.  The United States of America, the State in which any of the properties comprising the Unencumbered Pool Properties is located, the city or town in which the land is located, and any political subdivision agency, authority, department, commission, board, bureau, or instrumentality of any of them.

Hazardous Substances.  Shall mean any and all hazardous, explosive, corrosive, flammable, carcinogenic, toxic, infectious or radioactive substances, pollutants, contaminants, wastes or materials listed or defined by any applicable federal, state or local statutes, regulations or ordinances as hazardous or toxic and specifically shall include petroleum oil and its fractions.

Hedging Contracts.   means, interest rate swap agreements, interest rate cap agreements and interest rate collar agreements, or any other agreements or arrangements designed to protect the Borrower against fluctuations in interest rates or currency exchange rates entered into between (a) the Borrower and the Agent (or its affiliate) and/or any Lender (or its affiliate), (b) if a Borrower Election of Early Termination has occurred under the applicable Hedging Contract, any such Hedging Contract made by Borrower and another Lender (or affiliate), and/or (c) if a Permitted Transfer has occurred under the applicable Hedging Contract, any such Hedging Contracts made by the Borrower and a Permitted Transferee.  “Borrower Election of Early Termination” shall mean that (i) Borrower has designated an Early Termination Date pursuant to (and as defined under) the applicable Hedging Contract, or (ii) Borrower has designated an Early Termination Date under the applicable Hedging Contract as a result of a Ratings Change.  “Permitted Transfer” shall mean a transfer under Section 6(b)(ii) or Section 7, as applicable, of the applicable Hedging Contract.  “Permitted Transferee” shall mean a permitted transferee under Section 6(b)(ii) or Section 7, as applicable, of the applicable Hedging Contract.

Hedging Obligations means, with respect to the Borrower, all liabilities of the Borrower to the Agent under Hedging Contracts.

Indebtedness.  All obligations, contingent and otherwise, that in accordance with generally accepted accounting principles should be classified upon the obligor’s balance sheet as liabilities, or to which reference should be made by footnotes thereto, including in any event and whether or not so classified:  (a) all debt and similar monetary obligations; (b) all liabilities secured by any mortgage, pledge, security interest, lien, charge, or other encumbrance existing on property owned or acquired subject thereto, whether or not the liability secured thereby shall have been assumed; (c) all liabilities under capitalized leases; (d) all guaranties, endorsements and other contingent obligations whether direct or indirect in respect of Indebtedness of others, including the obligations to reimburse the issuer in respect of any letters of credit, and (e) all unsecured Indebtedness.

Schedule 1 - - 5

Individual Lender Litigation Expenses means all costs and expenses (including reasonable attorneys’ fees) incurred by any individual Lender in any litigation concerning the Loan in which such Lender has been named as a party defendant, but only to the extent such costs and expenses are reimbursable to such Lender by the Borrower under the Loan Documents.

Initial Agreement.  As defined in the preamble.

Initial Maturity Date.  October 15, 2011.

Intangible Assets.  Goodwill, the purchase price of acquired assets in excess of the fair market value thereof, trademarks, trade names, service marks, brand names, copyrights, patents and licenses, and rights with respect to the foregoing.

Intercreditor Agreement.  The intercreditor agreement of even date between the lenders under the Revolver Loan and the lenders under the Term Facility.

Interest Period.

relative to any Libor Advance

(i)           initially, the period beginning on (and including) the date on which such Libor Advance is made or continued as, or converted into, a Libor Advance pursuant to Section 2.5.3 and ending on (but excluding) the day which numerically corresponds to such date one, two or three months thereafter (or, if such month has no numerically corresponding day, on the last Business Day of such month), in each case as the Borrower may select in its notice pursuant to Section 2.5.3; and

(ii)           thereafter, each period commencing on the last day of the next preceding Interest Period applicable to such Libor Advance and ending one, two or three months  thereafter, as selected by the Borrower by irrevocable notice to the Agent not less than three Business Days prior to the last day of the then current Interest Period with respect thereto;

provided, however, that

(a) the Borrower shall not be permitted to select Interest Periods to be in effect at any one time which have expiration dates occurring on more than five (5) different dates;

(b) Interest Periods commencing on the same date for Libor Advances comprising part of the same advance under this agreement shall be of the same duration;

(c) Interest Periods for Libor Advances in connection with which Borrower has or may incur Hedging Obligations with the Agent shall be of the same duration as the relevant periods set under the applicable Hedging Contracts;

Schedule 1 - - 6

(d) if such Interest Period would otherwise end on a day which is not a Business Day, such Interest Period shall end on the next following Business Day unless such day falls in the next calendar month, in which case such Interest Period shall end on the first preceding Business Day; and

(e) no Interest Period may end later than the Maturity Date of the Loan (as actually extended).

Investment.  All expenditures made and all liabilities incurred (continently or otherwise) for the acquisition of stock or Indebtedness of, and all loans, advances, capital contributions to, any Person.

Joinder Documents.  The one or more joinder agreements to be executed by a Wholly Owned Subsidiary which is to become a Borrower after the Closing Date in the form attached hereto as Exhibit A.

Late Charges.  See Section 2.5.

Lenders as defined in the Preamble.

Libor Advance.  The term “Libor Advance” means any principal outstanding under this Agreement which pursuant to this Agreement bears interest at the Adjusted Libor Rate.

LIBOR Rate means, relative to any Interest Period or LIBOR Advances, the offered rate for deposits of U.S. Dollars in an amount approximately equal to the amount of the requested LIBOR Advances for a term coextensive with the designated Interest Period which the British Bankers’ Association fixes as its LIBOR rate as of 11:00 a.m. London time on the day which is two London Banking Days prior to the beginning of such Interest Period.  If such day is not a London Banking Day, the LIBOR Rate shall be determined on the next preceding day which is a London Banking Day.  If for any reason the Agent cannot determine such offered rate by the British Bankers’ Association, the Agent may, in its discretion, select a replacement index based on the arithmetic mean of the quotations, if any, of the interbank offered rate by first class banks in London or New York for deposits in comparable amounts and maturities.

Libor Rate Loan Prepayment Fee as defined in Section 2.5.15.

LIBOR Lending Rate means, relative to any Libor Advance to be made, continued or maintained as, or converted into, a Libor Advance for any Interest Period, a rate per annum determined pursuant to the following formula:

Libor Lending Rate	=	LIBOR Rate
		(1.00 - LIBOR Reserve Percentage)

LIBOR Reserve Percentage means, relative to any day of any Interest Period for LIBOR Advances, the maximum aggregate (without duplication) of the rates (expressed as a decimal fraction) of reserve requirements (including all basic, emergency, supplemental, marginal and other reserves and taking into account any transitional adjustments or other scheduled changes in reserve requirements) under any regulations of the Board of Governors of the Federal Reserve System (the “Board”) or other governmental authority having jurisdiction with respect thereto as issued from time to time and then applicable to assets or liabilities consisting of “Eurocurrency Liabilities”, as currently defined in Regulation D of the Board, having a term approximately equal or comparable to such Interest Period.

Schedule 1 - - 7

Liquidation Proceeds.  Amounts received by the Agent and/or the Lenders in the exercise of the rights and remedies under the Loan Documents.

Loan.  The loan or any portion thereof which is the subject of this Agreement.

Loan Amount.  An amount equal to $75,000,000.

Loan Documents.  This Agreement, the Note, the Joinder Documentation and all other agreements, documents and instruments now or hereafter evidencing, securing or otherwise relating to the Loan, all as the same may hereafter be amended with the prior written consent of Lender.

Loan to Value Ratio.  See §10.8(a)

London Banking Day means a day on which dealings in US dollar deposits are transacted in the London interbank market.

Make Whole Provision as defined in Section 2.5.16.

Maturity Date.  The Initial Maturity Date, or if extended the Extended Maturity Date.

Net Income as defined in accordance with GAAP.

Net Operating Income.  Net Income plus interest expense and adjusted by adding back or deducting non-cash items as part of determining net income per GAAP (including depreciation and amortization, non-cash compensation expenses, straight line rent, gains on sale etc.).  In addition, Net Operating Income will deduct an annual capital expenditure of $.25 per square foot applied to commercial properties pool or $350 per unit for the apartment properties.

Note(s).  The Promissory Notes in the aggregate principal face amount of the Loan Amount dated as of the date hereof, made by the Borrower to the order of the Lenders, as such Promissory Notes may hereafter be extended, renewed, replaced, substituted, or modified with the prior written consent of Borrower and Lenders in accordance with the terms hereof.

Obligations.  All indebtedness, obligations and liabilities (including Hedging Obligations) of the Borrower to the Agent and the Lenders existing on the date of this Agreement or arising thereafter, direct or indirect, joint or several, absolute or contingent, matured or unmatured, liquidated or unliquidated, arising by contract, operation of law or otherwise, incurred under this Agreement or any of the other Loan Documents or in respect of any of the Advances or the Note.

Organizational Documents.  For any corporation, partnership, trust, limited liability company, limited liability partnership, unincorporated association, business or other legal entity, the documents pursuant to which such entity has been established or organized, as such documents may hereafter be amended with the prior written consent of Agent which shall not be unreasonably withheld or delayed.

Schedule 1 - - 8

Other Properties.  Shall mean all real properties owned by a Borrower, other than Unencumbered Pool Properties.

Outstanding.  With respect to the Advances or the Loan, the aggregate unpaid principal thereof as of any date of determination.

Permitted Liens.  Liens: (i) permitted by §9.4, (ii) for taxes unpaid and diligently contested in good faith by the Borrower unless payment is required prior to the contesting of any such taxes and provided no enforcement proceedings have been commenced with respect to any lien filed in connection with such dispute and adequate reserves have been established for such taxes, (iii) for assessments, governmental charges, liens for labor, materials or supplies which do not materially interfere with the use of the properties comprising the Unencumbered Pool Properties or the operation of the business of the Borrower and do not exceed in the aggregate at any one time $5,000,000.00, (iv) liens on a property existing at the time of acquisition and refinancings of such liens, (v) liens on any 1031 Property consisting of any liens of FSP, a Wholly Owned Subsidiary or the 1031 Intermediary, (vi) liens securing Indebtedness permitted under Section 10.2(e), and (vii) other liens which do not exceed in the aggregate at any one time $1,000,000.00.

Person.  Any individual, corporation, partnership, trust, unincorporated association, business, or other legal entity, and any government or any governmental agency or political subdivision thereof.

Present Value.  The term “Present Value” means the value at the applicable maturity discounted to the date of pre-payment using the Treasury Rate.

Prime Rate.  The term “Prime Rate” means the per annum rate of interest so designated from time to time by Citizens as its prime rate.  The Prime Rate is a reference rate and does not necessarily represent the lowest or best rate being charged to any customer.

Project Approvals.  All approvals, consents, waivers, orders, agreements, acknowledgments, authorizations, permits and licenses required under applicable Requirements or under the terms of any restriction, covenant or easement affecting any of the properties comprising the Unencumbered Pool Properties, or otherwise necessary or desirable, for the ownership, acquisition, construction, equipping, use, occupancy and operation of any of the properties comprising the Unencumbered Pool Properties, whether obtained from a Governmental Authority or any other Person.

Properties.  Collectively, the Unencumbered Pool Properties and the Other Properties.

Ratings Change means on any date, either Moody’s or S&P assigns a rating below the Rating Threshold (as defined below), or fails to assign a rating, to the unsecured, unguaranteed and unsupported senior long-term debt or other similar obligations of Citizens. As used herein, (x) “Moody’s” means Moody’s Investors Service, Inc., or any successor nationally recognized statistical rating organization, (y) “S&P” means Standard & Poor’s Ratings Services, or any successor nationally recognized statistical rating organization, and (z) “Rating Threshold” means (A) with respect to Moody’s, “Baa” and (B) with respect to S&P, BBB.

Schedule 1 - - 9

Real Estate Assets.  Means investments in non-consolidated REITs, Syndication REITs, assets held for syndication, mortgages on real estate and/or investments in other REITs.

Register as defined in Section 18.15.3.

Required Lenders.  As of any date, the Lenders holding at least sixty percent (60%) of the outstanding principal amount of the Notes on such date; and if no such principal is outstanding, the Lenders whose aggregate Commitments constitute at least sixty percent (60%) of the Total Commitment; provided, however, as long as there are only two (2) Lenders, Required Lenders shall require that both Lenders concur on any decision requiring Required Lenders’ consent.

Requirements.  Any law, ordinance, code, order, rule or regulation of any Governmental Authority relating in any way to the acquisition, ownership, construction, use, occupancy and operation of the properties comprising the Unencumbered Pool Properties.

Revolver Loan.  Means the revolving facility as evidenced by the Third Amended and Restated Loan Agreement dated October 19, 2007 with a present maximum amount of $250,000,000.00 between the Borrower and the Lenders thereunder, as may be amended, modified, restated or revised from time to time.

Second Extension Period.  See §2.8.

Subsidiary.  Any corporation, partnership, association, trust, or other business entity of which the Borrower shall at any time own directly, or indirectly through a Subsidiary or Subsidiaries, at least a majority of the beneficial or ownership interests therein.  The term Subsidiary does not include any Syndication REIT or any corporation, partnership, trust or other business entity that is wholly-owned by any Syndication REIT.

Supermajority of Lenders.  As of any date, the Lenders holding at least seventy-five percent (75%) of the outstanding principal amount of the Notes on such date; and if no such principal is outstanding, the Lenders whose aggregate Commitments constitute at least seventy-five percent (75%) of the Total Commitment; provided, however, as long as there are only two (2) Lenders, a Supermajority of Lenders shall require that both Lenders concur on any decision requiring a Supermajority of Lenders’ consent.

Syndication Event.  The sale by the Borrower, or an affiliate, of shares of preferred stock or other similar interests in an owner of real property established by the Borrower, or an affiliate in connection with the syndication of such property by the Borrower.  For purposes of clarity, the term “Syndication Event” does not include an Affiliate Disposition.

Syndication REIT.  Means a REIT that is managed and controlled by the Borrower but is not a Wholly Owned Subsidiary, including a “Sponsored REIT” as such term is used in FSP’s filings with the Securities and Exchange Commission.

Taking.  Any condemnation for public use of, or damage by reason of, the action of any Governmental Authority, or any transfer by private sale in lieu thereof, either temporarily or permanently.

Schedule 1 - - 10

Tangible Net Worth.  The excess of Total Assets over Total Liabilities, and less the sum of:

(a) the total book value of all assets of the Borrower properly classified as Intangible Assets ; plus

(b) all amounts representing any write-up in the book value of any assets of the Borrower resulting from a revaluation thereof subsequent to the Balance Sheet Date; plus

(c) to the extent otherwise includable in the computation of Tangible Net Worth, any subscriptions receivable.

Taxes as defined in Section 2.6.3.

Term Facility.  Means the term loan contemplated herein in the amount of the Loan Amount.

Total Assets.  All assets of the Borrower determined in accordance with generally accepted accounting principles.

Total Commitment.  The sum of the Commitments of the Lenders, as in effect from time to time.

Total Liabilities.  All liabilities of the Borrower determined in accordance with generally accepted accounting principles and all Indebtedness, without duplication of the Borrower, whether or not so classified.

Treasury Rate.  The term “Treasury Rate, means, as of the date of any calculation or determination, the latest Published rate for United States Treasury Notes or Bills (but the rate on Bills issued on a discounted basis shall be converted to a bond equivalent) as published weekly in the Federal Reserve Statistical Release H.15(519) of Selected Interest Rates in an amount which approximates (as determined by Agent) the amount approximately comparable to the portion of the Loan to which the Treasury Rating applies for the Interest Period, or (ii) in the case of a prepayment, the amount prepaid and with a maturity closest to the original maturity of the installment which is prepaid in whole or in part.

Unencumbered Pool Properties.  Collectively, the real properties listed on Exhibit H - Unencumbered Pool Properties.  Exhibit H shall be deemed amended (A) to exclude real properties owned by the Borrower which have liens thereon which secure Indebtedness, (B) to include real properties owned by Borrower which are free of liens which secure Indebtedness (including any Indebtedness which may have previously existed but is subsequently repaid, satisfied or otherwise discharged) and (C) to reflect Acquisitions and dispositions of real properties pursuant to Section 9.15.  A real property shall be deemed to be included as an Unencumbered Pool Property if any lien thereon is of the type specified in clauses (i), (ii), (iii), and/or (v) of the definition of Permitted Liens.

Schedule 1 - - 11

Unsecured Fixed Rate Debt Service.  Debt Service on Fixed Rate Debt calculated with reference only to any applicable Indebtedness that is unsecured.

Unsecured Floating Rate Debt Service.  Debt Service on Floating Rate Debt calculated with reference only to any applicable Indebtedness that is unsecured.

Value of the Properties.  As of the relevant date of determination the aggregate value of all of the Properties based upon the test quarter Net Operating Income multiplied by four (4) and divided by a 8.25% capitalization rate (7% for CBD Properties).  For any acquisitions made during a quarter the Net Operating Income will be calculated by dividing Net Operating Income by the number of months such asset(s) is owned during such test quarter multiplied by 3 to approximate a full quarter.

Value of the Unencumbered Pool Properties.  As of the relevant date of determination the aggregate value of all of the properties comprising the Unencumbered Pool Properties based upon the test quarter Net Operating Income multiplied by four (4) and divided by a 8.25% capitalization rate (7% for CBD Properties).  For any acquisitions made during a quarter the Net Operating Income will be calculated by dividing Net Operating Income by the number of months such asset(s) is owned during such test quarter multiplied by 3 to approximate a full quarter.

Variable Rate.  The term “Variable Rate” means a per annum rate equal at all times to the Prime Rate plus 0 basis points, with changes therein to be effective simultaneously with any change in the Prime Rate without notice or demand of any kind.

Variable Rate Advance.  The term “Variable Rate Advance” means any principal amount outstanding under this Agreement which pursuant to this Agreement bears interest at the Variable Rate.

Wholly Owned Subsidiaries.  Any Subsidiary with respect to which FSP shall own directly or indirectly (through a Subsidiary or Subsidiaries) 100% of the outstanding voting interest and economic interest.  For the avoidance of doubt, no Syndication REIT shall be deemed to be a Wholly Owned Subsidiary.

1031 Intermediary.  A Person in such person’s capacity as an intermediary or accommodation holder in connection with an exchange of property by FSP or a Wholly Owned Subsidiary intended to qualify under Section 1031 of the Internal Revenue Code as amended.

1031 Property.  A property whose legal title or other indicia of ownership is held by a 1031 Intermediary for the benefit of any of FSP or a Wholly Owned Subsidiary as part of a 1031 tax exchange intended to qualify under Section 1031 of the Internal Revenue Code as amended.

Schedule 1 - - 12

SCHEDULE 2

LIST OF BORROWERS

FSP Holdings LLC (DE)

FSP Investments LLC (MA)

FSP Property Management LLC (MA)

FSP Protective TRS Corp. (MA)

FSP Hillview Center Limited Partnership (MA)

FSP Montague Business Center Corp. (DE)

FSP Greenwood Plaza Corp. (DE)

FSP 380 Interlocken Corp. (DE)

FSP 390 Interlocken LLC (DE)

FSP Blue Lagoon Drive LLC (DE)

FSP One Overton Park LLC (DE)

FSP Northwest Point LLC (DE)

FSP River Crossing LLC (DE)

FSP Bollman Place Limited Partnership (MA)

FSP Southfield Centre Limited Partnership (MA)

FSP Forest Park IV NC Limited Partnership (NC)

FSP Park Seneca Limited Partnership (MA)

FSP Addison Circle Limited Partnership (TX)

FSP Park Ten Phase II Limited Partnership (TX)

FSP Collins Crossing Limited Partnership (TX)

FSP Eldridge Green Limited Partnership (TX)

FSP Liberty Plaza Limited Partnership (TX)

FSP Park Ten Limited Partnership (TX)

Schedule 2 - - 1

 FSP Willow Bend Office Center Limited Partnership (TX)

FSP Innsbrook Corp. (DE)

FSP East Baltimore Street LLC (DE)

Schedule 2 - - 2

SCHEDULE 3

ADVANCE/LOAN REQUEST

[Date]

RBS Citizens, National Association

28 State Street

Boston, Massachusetts  02109

Attention:  _______________

Loan No.  ________________

Dear Gentlemen:

This letter is to request an Advance of the above-referenced loan in the amount of $________________ (the “Advance”).  The Advance shall be transferred to Account No. _________________ with RBS Citizens, National Association and received in said Account by _________, ______ at _________ a.m./p.m.

Very truly yours,

FRANKLIN STREET PROPERTIES CORP.

By:________________________

Name:

Its:

Schedule 3 - - 1

SCHEDULE 4

SUBSIDIARIES

FSP Blue Lagoon Drive Corp.

FSP Forest Park IV LLC

FSP Addison Circle LLC

FSP Addison Circle Corp.

FSP Collins Crossing LLC

FSP Collins Crossing Corp.

FSP Eldridge Green LLC

FSP Eldridge Green Corp.

FSP Park Ten LLC

FSP Park Ten Development LLC

FSP Park Ten Development Corp.

FSP Willow Bend Office Center LLC

FSP Willow Bend Office Center Corp.

Schedule 4 - - 1

SCHEDULE 5

LOAN AMORTIZATION PAYMENT SCHEDULE

Franklin Street Properties
Term loan amortization schedule
Fixed interest rate assumed	6.000%
Original Principal of loan	75,000,000
Loan Start Date	15-Oct-08
Loan Maturity Date	15-Oct-11	Interest only until 11/1/2010

Interest Calculation Periods		Beginning	Principal	Ending	Rate Fixing	Payment
Start Date	End Date	Notional	Paydown	Principal	Date	Date
15-Oct-08	3-Nov-08	75,000,000	0	75,000,000	13-Oct-08	3-Nov-08
3-Nov-08	1-Dec-08	75,000,000	0	75,000,000	30-Oct-08	1-Dec-08
1-Dec-08	2-Jan-09	75,000,000	0	75,000,000	27-Nov-08	2-Jan-09
2-Jan-09	2-Feb-09	75,000,000	0	75,000,000	30-Dec-08	2-Feb-09
2-Feb-09	2-Mar-09	75,000,000	0	75,000,000	29-Jan-09	2-Mar-09
2-Mar-09	1-Apr-09	75,000,000	0	75,000,000	26-Feb-09	1-Apr-09
1-Apr-09	1-May-09	75,000,000	0	75,000,000	30-Mar-09	1-May-09
1-May-09	1-Jun-09	75,000,000	0	75,000,000	29-Apr-09	1-Jun-09
1-Jun-09	1-Jul-09	75,000,000	0	75,000,000	28-May-09	1-Jul-09
1-Jul-09	3-Aug-09	75,000,000	0	75,000,000	29-Jun-09	3-Aug-09
3-Aug-09	1-Sep-09	75,000,000	0	75,000,000	30-Jul-09	1-Sep-09
1-Sep-09	1-Oct-09	75,000,000	0	75,000,000	27-Aug-09	1-Oct-09
1-Oct-09	2-Nov-09	75,000,000	0	75,000,000	29-Sep-09	2-Nov-09
2-Nov-09	1-Dec-09	75,000,000	0	75,000,000	29-Oct-09	1-Dec-09
1-Dec-09	4-Jan-10	75,000,000	0	75,000,000	27-Nov-09	4-Jan-10
4-Jan-10	1-Feb-10	75,000,000	0	75,000,000	30-Dec-09	1-Feb-10
1-Feb-10	1-Mar-10	75,000,000	0	75,000,000	28-Jan-10	1-Mar-10
1-Mar-10	1-Apr-10	75,000,000	0	75,000,000	25-Feb-10	1-Apr-10
1-Apr-10	4-May-10	75,000,000	0	75,000,000	30-Mar-10	4-May-10
4-May-10	1-Jun-10	75,000,000	0	75,000,000	29-Apr-10	1-Jun-10
1-Jun-10	1-Jul-10	75,000,000	0	75,000,000	27-May-10	1-Jul-10
1-Jul-10	2-Aug-10	75,000,000	0	75,000,000	29-Jun-10	2-Aug-10
2-Aug-10	1-Sep-10	75,000,000	0	75,000,000	29-Jul-10	1-Sep-10
1-Sep-10	1-Oct-10	75,000,000	0	75,000,000	27-Aug-10	1-Oct-10
1-Oct-10	1-Nov-10	75,000,000	74,663	74,925,337	29-Sep-10	1-Nov-10
1-Nov-10	1-Dec-10	74,925,337	75,036	74,850,301	28-Oct-10	1-Dec-10
1-Dec-10	4-Jan-11	74,850,301	75,411	74,774,890	29-Nov-10	4-Jan-11
4-Jan-11	1-Feb-11	74,774,890	75,788	74,699,102	30-Dec-10	1-Feb-11
1-Feb-11	1-Mar-11	74,699,102	76,167	74,622,935	28-Jan-11	1-Mar-11
1-Mar-11	1-Apr-11	74,622,935	76,931	74,546,004	25-Feb-11	1-Apr-11
1-Apr-11	3-May-11	74,546,004	77,316	74,468,688	30-Mar-11	3-May-11
3-May-11	1-Jun-11	74,468,688	77,702	74,390,986	28-Apr-11	1-Jun-11
1-Jun-11	1-Jul-11	74,390,986	78,091	74,312,895	27-May-11	1-Jul-11
1-Jul-11	1-Aug-11	74,312,895	78,481	74,234,414	29-Jun-11	1-Aug-11
1-Aug-11	1-Sep-11	74,234,414	78,874	74,155,540	28-Jul-11	1-Sep-11
1-Sep-11	3-Oct-11	74,155,540	79,267	74,076,273	30-Aug-11	3-Oct-11
3-Oct-11	15-Oct-11	74,076,273	74,076,273	0	29-Sep-11	15-Oct-11

Schedule 5 - - 1

EXHIBIT E

FORM OF

ASSIGNMENT AND ACCEPTANCE

Dated:  ____________, 2008

Reference is made to the Term Loan Agreement, dated as of October 15, 2008 (as amended and in effect from time to time, the "Loan Agreement"), by and between Franklin Street Properties Corp, and the additional entities listed from time to time on Schedule 2 to the Loan Agreement, having an address at 401 Edgewater Place, Suite 200, Wakefield, Massachusetts 01880-6210 (“Borrower”), RBS CITIZENS, NATIONAL ASSOCIATION and the other lending institutions which may become parties to the Loan Agreement (the “Lenders”), and RBS CITIZENS, NATIONAL ASSOCIATION as agent for itself and such other lending institutions (the “Agent”).  Capitalized terms used herein and not otherwise defined shall have the meanings assigned to such terms in the Loan Agreement.

__________________________________ (the "Assignor") and ______________ (the "Assignee") agree as follows:

I. The Assignor hereby sells and assigns to the Assignee, and the Assignee hereby purchases and assumes from the Assignor, a _______________% interest in and to all of the Assignor's rights and obligations under the Loan Documents as of the Effective Date (as hereinafter defined).  The amount of the Assignor's Commitment being purchased by and assigned to the Assignee as of the Effective Date is $_______________.

II. The Assignor (i) represents that as of the date hereof, its Commitment Percentage (without giving effect to assignments thereof which have not yet become effective) is 100%, and the outstanding balance of the Loan owing to the Assignor under the Note held by the Assignor (unreduced by any assignments thereof which have not yet become effective) is $_______________; (ii) makes no representation or warranty and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with the Loan Documents or the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any other instrument or document furnished pursuant thereto, other than that the Assignor is the legal and beneficial owner of the interest being assigned by it hereunder and that such interest is free and clear of any adverse claim; (iii) makes no representation or warranty and assumes no responsibility with respect to the financial condition of the Borrower, or any other person which may be primarily or secondarily liable in respect of any of the Obligations or any of their obligations, or the performance or observance by the Borrower, or any other person primarily or secondarily liable in respect of any of the obligations under any of the Loan Documents or any other instrument or document delivered or executed pursuant thereto; and (iv) attaches the Note delivered to it under the Loan Agreement and requests that the Borrower exchange such Note for a new Note payable to each of the Assignor and the Assignee as follows:

Exhibit E - - 1

Note Payable to the Order of:                                                                Amount of Note

____________________                                                                    ($_______________)

____________________                                                                    ($_______________)

III. The Assignee (i) represents and warrants that it is legally authorized to enter into this Assignment and Acceptance; (ii) confirms that it has received a copy of the Loan Documents, together with copies of the most recent financial statements delivered pursuant to the Loan Agreement and such other documents and information as the Assignee has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and Acceptance; (iii) agrees that it will, independently and without reliance upon the Assignor, any other Lender or the Agent and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Documents; (iv) confirms that it is an Eligible Assignee; (v) appoints and authorizes the Agent to take such action as agent on its behalf and to exercise such powers as are reasonably incidental thereto pursuant to the terms of the Loan Documents; (vi) agrees that it will perform all the obligations which by the terms of the Loan Documents are required to be performed by the Assignee as a Lender in accordance with the terms of the Loan Documents; and (vi) specifies as to its address for notices the office set forth beneath its name on the signature page hereof.

IV. The effective date for this Assignment and Acceptance shall be _______________ (the "Effective Date").  Following the execution of this Assignment and Acceptance, it will be delivered to the Agent for acceptance and recording in the Register by the Agent.  Upon such recordation, and prior to such assignment being effective the Assignee shall pay the Agent (for the Agent's own account) a registration fee in the sum of $3,500.00.

V. Upon such acceptance and recording, from and after the Effective Date, (i) the Assignee shall be a party to the Loan Agreement and, to the extent provided in this Assignment and Acceptance, have the rights and obligations of a Lender thereunder, and (ii) the Assignor shall, with respect to that portion of its interest under the Loan Documents  assigned hereunder relinquish its future rights and be released from its future obligations under the Loan Documents but shall remain liable for all obligations which arose prior to such assignment.

VI. Upon such acceptance and recording, from and after the Effective Date, the Agent shall make all payments in respect of the rights and obligations assigned hereby (including payments of principal, interest, fees and other amounts) to the Assignee.  The Assignor and Assignee shall make all appropriate adjustments in payments for periods prior to the Effective Date by the Agent or with respect to the making of this assignment directly between themselves.

Exhibit E - - 2

VII. THIS ASSIGNMENT AND ACCEPTANCE IS INTENDED TO TAKE EFFECT AS A SEALED INSTRUMENT TO BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS.

Exhibit E - - 3

IN WITNESS WHEREOF, intending to be legally bound, each of the undersigned has caused this Assignment and Acceptance to be executed on its behalf by its officer thereunto duly authorized, as of the date first above written.

“Assignor”

______________________________

By:___________________________

Name:

Title:

"Assignee"

______________________________

By:___________________________

Name:

Title:

Notice Address:                        ______________________________

______________________________

______________________________

Attn:_________________________

Telephone No.:

Telecopier No.:

Exhibit E - - 4

EXHIBIT F

LENDER’S COMMITMENT AND PERCENTAGE

RBS Citizens, National Association

$35,000,000.00 - - 46.6667%

Bank of America, N.A.

$25,000,000.00 - - 33.3333%

Wachovia Bank, National Association

$15,000,000.00 - - 20.00%

Exhibit F - - 1

EXHIBIT H UNENCUMBERED POOL PROPERTIES
Unencumbered Pool Property Name	Subsidiary name
Hillview Center Milpitas, California	FSP Hillview Center Limited Partnership
Montague Business Center	FSP Montague Business Center Corp.
Greenwood Plaza	FSP Greenwood Plaza Corp.
380 Interlocken	FSP 380 Interlocken Corp.
390 Interlocken	FSP 390 Interlocken LLC
Blue Lagoon	FSP Blue Lagoon Drive LLC
Overton Park	FSP One Overton Park LLC
Northwest Point	FSP Northwest Point LLC
River Crossing	FSP River Crossing LLC
Bollman Place	FSP Bollman Place Limited Partnership
Southfield Centre	FSP Southfield Centre Limited Partnership
Forest Park	FSP Forest Park IV NC Limited Partnership
Park Seneca	FSP Park Seneca Limited Partnership
Addison Circle	FSP Addison Circle Limited Partnership
Park Ten Phase II	FSP Park Ten Phase II Limited Partnership
Collins Crossing	FSP Collins Crossing Limited Partnership

Exhibit H - - 1

Eldridge Green	FSP Eldridge Green Limited Partnership
Liberty Plaza	FSP Liberty Plaza Limited Partnership
Park Ten	FSP Park Ten Limited Partnership
Willow Bend Office Center	FSP Willow Bend Office Center Limited Partnership
Innsbrook	FSP Innsbrook Corp.
East Baltimore Street	FSP East Baltimore Street LLC
Properties held directly by the FSP	Properties held directly by the FSP
Centennial Park	Centennial
Meadow Point	Meadow Point
Timberlake	Timberlake
Timberlake East	Timberlake East
Federal Way	Federal Way

Exhibit H - - 2

EX-10.2

Exhibit 10.2

(Multicurrency — Cross Border)

ISDA®

International Swap Dealers Association, Inc.

MASTER AGREEMENT

dated as of …October 15, 2008……………..

……RBS Citizens, N.A. ……and……Franklin Street Properties Corp. …………

have entered and/or anticipate entering into one or more transactions (each a “Transaction”) that are or will be governed by this Master Agreement, which includes the schedule (the “Schedule”), and the documents and other confirming evidence (each a “Confirmation”) exchanged between the parties confirming those Transactions.

Accordingly, the parties agree as follows:  —

1. Interpretation

Definitions.  The terms defined in Section 14 and in the Schedule will have the meanings therein specified for the purpose of this Master Agreement.

(a)           Inconsistency.In the event of any inconsistency between the provisions of the Schedule and the other provisions of this Master Agreement, the Schedule will prevail.  In the event of any inconsistency between the provisions of any Confirmation and this Master Agreement (including the Schedule), such Confirmation will prevail for the purpose of the relevant Transaction.

(b)           Single Agreement.  All Transactions are entered into in reliance on the fact that this Master Agreement and all Confirmations form a single agreement between the parties (collectively referred to as this “Agreement”), and the parties would not otherwise enter into any Transactions.

2.  Obligations

(a)           General Conditions.

(i)           Each party will make each payment or delivery specified in each Confirmation to be made by it, subject to the other provisions of this Agreement.

(ii)           Payments under this Agreement will be made on the due date for value on that date in the place of the account specified in the relevant Confirmation or otherwise pursuant to this Agreement, in freely transferable funds and in the manner customary for payments in the required currency.  Where settlement is by delivery (that is, other than by payment), such delivery will be made for receipt on the due date in the manner customary for the relevant obligation unless otherwise specified in the relevant Confirmation or elsewhere in this Agreement.

(iii)           Each obligation of each party under Section 2(a)(i) is subject to (1) the condition precedent that no Event of Default or Potential Event of Default with respect to the other party has occurred and is continuing, (2) the condition precedent that no Early Termination Date in respect of the relevant Transaction has occurred or been effectively designated and (3) each other applicable condition precedent specified in this Agreement.

Copyright © 1992 by International Swap Dealers Association, Inc.

(b)           Change of Account.Either party may change its account for receiving a payment or delivery by giving notice to the other party at least five Local Business Days prior to the scheduled date for the payment or delivery to which such change applies unless such other party gives timely notice of a reasonable objection to such change.

(c)           Netting.If on any date amounts would otherwise be payable:—

(i)           in the same currency; and

(ii)           in respect of the same Transaction,

by each party to the other, then, on such date, each party’s obligation to make payment of any such amount will be automatically satisfied and discharged and, if the aggregate amount that would otherwise have been payable by one party exceeds the aggregate amount that would otherwise have been payable by the other party, replaced by an obligation upon the party by whom the larger aggregate amount would have been payable to pay to the other party the excess of the larger aggregate amount over the smaller aggregate amount.

The parties may elect in respect of two or more Transactions that a net amount will be determined in respect of all amounts payable on the same date in the same currency in respect of such Transactions, regardless of whether such amounts are payable in respect of the same Transaction.  The election may be made in the Schedule or a Confirmation by specifying that subparagraph (ii) above will not apply to the Transactions identified as being subject to the election, together with the starting date (in which case subparagraph (ii) above will not, or will cease to, apply to such Transactions from such date).  This election may be made separately for different groups of Transactions and will apply separately to each pairing of Offices through which the parties make and receive payments or deliveries.

(d)           Deduction or Withholding for Tax.

(i)           Gross-Up. All payments under this Agreement will be made without any deduction or withholding for or on account of any Tax unless such deduction or withholding is required by any applicable law, as modified by the practice of any relevant governmental revenue authority, then in effect.  If a party is so required to deduct or withhold, then that party (“X”) will:—

(1)           promptly notify the other party (“Y”) of such requirement;

(2)           pay to the relevant authorities the full amount required to be deducted or withheld (including the full amount required to be deducted or withheld from any additional amount paid by X to Y under this Section 2(d)) promptly upon the earlier of determining that such deduction or withholding is required or receiving notice that such amount has been assessed against Y;

(3)           promptly forward to Y an official receipt (or a certified copy), or other documentation reasonably acceptable to Y, evidencing such payment to such authorities; and

(4)           if such Tax is an Indemnifiable Tax, pay to Y, in addition to the payment to which Y is otherwise entitled under this Agreement, such additional amount as is necessary to ensure that the net amount actually received by Y (free and clear of Indemnifiable Taxes, whether assessed against X or Y) will equal the full amount Y would have received had no such deduction or withholding been required.  However, X will not be required to pay any additional amount to Y to the extent that it would not be required to be paid but for:—

(A)           the failure by Y to comply with or perform any agreement contained in Section 4(a)(i), 4(a)(iii) or 4(d); or

(B)           the failure of a representation made by Y pursuant to Section 3(f) to be accurate and true unless such failure would not have occurred but for (I) any action taken by a taxing authority, or brought in a court of competent jurisdiction, on or after the date on which a Transaction is entered into (regardless of whether such action is taken or brought with respect to a party to this Agreement) or (II) a Change in Tax Law.

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(ii)           Liability.  If:  —

(1)           X is required by any applicable law, as modified by the practice of any relevant governmental revenue authority, to make any deduction or withholding in respect of which X would not be required to pay an additional amount to Y under Section 2(d)(i)(4);

(2)           X does not so deduct or withhold; and

(3)           a liability resulting from such Tax is assessed directly against X,

then, except to the extent Y has satisfied or then satisfies the liability resulting from such Tax, Y will promptly pay to X the amount of such liability (including any related liability for interest, but including any related liability for penalties only if Y has failed to comply with or perform any agreement contained in Section 4(a)(i), 4(a)(iii) or 4(d)).

(e)           Default Interest; Other Amounts.Prior to the occurrence or effective designation of an Early Termination Date in respect of the relevant Transaction, a party that defaults in the performance of any payment obligation will, to the extent permitted by law and subject to Section 6(c), be required to pay interest (before as well as after judgment) on the overdue amount to the other party on demand in the same currency as such overdue amount, for the period from (and including) the original due date for payment to (but excluding) the date of actual payment, at the Default Rate.  Such interest will be calculated on the basis of daily compounding and the actual number of days elapsed.  If, prior to the occurrence or effective designation of an Early Termination Date in respect of the relevant Transaction, a party defaults in the performance of any obligation required to be settled by delivery, it will compensate the other party on demand if and to the extent provided for in the relevant Confirmation or elsewhere in this Agreement.

3.  Representations

Each party represents to the other party (which representations will be deemed to be repeated by each party on each date on which a Transaction is entered into and, in the case of the representations in Section 3(f), at all times until the termination of this Agreement) that:—

(a)           Basic Representations.

(i)           Status.  It is duly organised and validly existing under the laws of the jurisdiction of its organisation or incorporation and, if relevant under such laws, in good standing;

(ii)           Powers.It has the power to execute this Agreement and any other documentation relating to this Agreement to which it is a party, to deliver this Agreement and any other documentation relating to this Agreement that it is required by this Agreement to deliver and to perform its obligations under this Agreement and any obligations it has under any Credit Support Document to which it is a party and has taken all necessary action to authorise such execution, delivery and performance;

(iii)           No Violation or Conflict.  Such execution, delivery and performance do not violate or conflict with any law applicable to it, any provision of its constitutional documents, any order or judgment of any court or other agency of government applicable to it or any of its assets or any contractual restriction binding on or affecting it or any of its assets;

(iv)           Consents.All governmental and other consents that are required to have been obtained by it with respect to this Agreement or any Credit Support Document to which it is a party have been obtained and are in full force and effect and all conditions of any such consents have been complied with; and

(v)           Obligations Binding.Its obligations under this Agreement and any Credit Support Document to which it is a party constitute its legal, valid and binding obligations, enforceable in accordance with their respective terms (subject to applicable bankruptcy, reorganisation, insolvency, moratorium or similar laws affecting creditors’ rights generally and subject, as to enforceability, to equitable principles of general application (regardless of whether enforcement is sought in a proceeding in equity orat law)).

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(b)           Absence of Certain Events.No Event of Default or Potential Event of Default or, to its knowledge, Termination Event with respect to it has occurred and is continuing and no such event or circumstance would occur as a result of its entering into or performing its obligations under this Agreement or any Credit Support Document to which it is a party.

(c)           Absence of Litigation.There is not pending or, to its knowledge, threatened against it or any of its Affiliates any action, suit or proceeding at law or in equity or before any court, tribunal, governmental body, agency or official or any arbitrator that is likely to affect the legality, validity or enforceability against it of this Agreement or any Credit Support Document to which it is a party or its ability to perform its obligations under this Agreement or such Credit Support Document.

(d)           Accuracy of Specified Information.All applicable information that is furnished in writing by or on behalf of it to the other party and is identified for the purpose of this Section 3(d) in the Schedule is, as of the date of the information, true, accurate and complete in every material respect.

(e)           Payer Tax Representation.Each representation specified in the Schedule as being made by it for the purpose of this Section 3(e) is accurate and true.

(f)           Payee Tax Representations.  Each representation specified in the Schedule as being made by it for the purpose of this Section 3(f) is accurate and true.

4.  Agreements

Each party agrees with the other that, so long as either party has or may have any obligation under this Agreement or under any Credit Support Document to which it is a party:—

(a)           Furnish Specified Information.It will deliver to the other party or, in certain cases under subparagraph (iii) below, to such government or taxing authority as the other party reasonably directs:—

(i)           any forms, documents or certificates relating to taxation specified in the Schedule or any Confirmation;

(ii)           any other documents specified in the Schedule or any Confirmation; and

(iii)           upon reasonable demand by such other party, any form or document that may be required or reasonably requested in writing in order to allow such other party or its Credit Support Provider to make a payment under this Agreement or any applicable Credit Support Document without any deduction or withholding for or on account of any Tax or with such deduction or withholding at a reduced rate (so long as the completion, execution or submission of such form or document would not materially prejudice the legal or commercial position of the party in receipt of such demand), with any such form or document to be accurate and completed in a manner reasonably satisfactory to such other party and to be executed and to be delivered with any reasonably required certification,

in each case by the date specified in the Schedule or such Confirmation or, if none is specified, as soon as reasonably practicable.

(b)           Maintain Authorisations.It will use all reasonable efforts to maintain in full force and effect all consents of any governmental or other authority that are required to be obtained by it with respect to this Agreement or any Credit Support Document to which it is a party and will use all reasonable efforts to obtain any that may become necessary in the future.

(c)           Comply with Laws.It will comply in all material respects with all applicable laws and orders to which it may be subject if failure so to comply would materially impair its ability to perform its obligations under this Agreement or any Credit Support Document to which it is a party.

(d)           Tax Agreement.It will give notice of any failure of a representation made by it under Section 3(f) to be accurate and true promptly upon learning of such failure.

(e)           Payment of Stamp Tax.Subject to Section 11, it will pay any Stamp Tax levied or imposed upon it or in respect of its execution or performance of this Agreement by a jurisdiction in which it is incorporated, organised, managed and controlled, or considered to have its seat, or in which a branch or office through which it is acting for the purpose of this Agreement is located (“Stamp Tax Jurisdiction”) and will indemnify the other party against any Stamp Tax levied or imposed upon the other party or in respect of the other party’s execution or performance of this Agreement by any such Stamp Tax Jurisdiction which is not also a Stamp Tax Jurisdiction with respect to the other party.

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5.  Events of Default and Termination Events

(a)           Events of Default.The occurrence at any time with respect to a party or, if applicable, any Credit Support Provider of such party or any Specified Entity of such party of any of the following events constitutes an event of default (an “Event of Default”) with respect to such party:—

(i)           Failure to Pay or Deliver.Failure by the party to make, when due, any payment under this Agreement or delivery under Section 2(a)(i) or 2(e) required to be made by it if such failure is not remedied on or before the third Local Business Day after notice of such failure is given to the party;

(ii)           Breach of Agreement.Failure by the party to comply with or perform any agreement or obligation (other than an obligation to make any payment under this Agreement or delivery under Section 2(a)(i) or 2(e) or to give notice of a Termination Event or any agreement or obligation under Section 4(a)(i), 4(a)(iii) or 4(d)) to be complied with or performed by the party in accordance with this Agreement if such failure is not remedied on or before the thirtieth day after notice of such failure is given to the party;

(iii)           Credit Support Default.

(1)           Failure by the party or any Credit Support Provider of such party to comply with or perform any agreement or obligation to be complied with or performed by it in accordance with any Credit Support Document if such failure is continuing after any applicable grace period has elapsed;

(2)           the expiration or termination of such Credit Support Document or the failing or ceasing of such Credit Support Document to be in full force and effect for the purpose of this Agreement (in either case other than in accordance with its terms) prior to the satisfaction of all obligations of such party under each Transaction to which such Credit Support Document relates without the written consent of the other party; or

(3)           the party or such Credit Support Provider disaffirms, disclaims, repudiates or rejects, in whole or in part, or challenges the validity of, such Credit Support Document;

(iv)           Misrepresentation.A representation (other than a representation under Section 3(e) or (f)) made or repeated or deemed to have been made or repeated by the party or any Credit Support Provider of such party in this Agreement or any Credit Support Document proves to have been incorrect or misleading in any material respect when made or repeated or deemed to have been made or repeated;

(v)           Default under Specified Transaction.The party, any Credit Support Provider of such party or any applicable Specified Entity of such party (1) defaults under a Specified Transaction and, after giving effect to any applicable notice requirement or grace period, there occurs a liquidation of, an acceleration of obligations under, or an early termination of, that Specified Transaction, (2) defaults, after giving effect to any applicable notice requirement or grace period, in making any payment or delivery due on the last payment, delivery or exchange date of, or any payment on early termination of, a Specified Transaction (or such default continues for at least three Local Business Days if there is no applicable notice requirement or grace period) or (3) disaffirms, disclaims, repudiates or rejects, in whole or in part, a Specified Transaction (or such action is taken by any person or entity appointed or empowered to operate it or act on its behalf);

(vi)           Cross Default.If “Cross Default” is specified in the Schedule as applying to the party, the occurrence or existence of (1) a default, event of default or other similar condition or event (however described) in respect of such party, any Credit Support Provider of such party or any applicable Specified Entity of such party under one or more agreements or instruments relating to Specified Indebtedness of any of them (individually or collectively) in an aggregate amount of not less than the applicable Threshold Amount (as specified in the Schedule) which has resulted in such Specified Indebtedness becoming, or becoming capable at such time of being declared, due and payable under such agreements or instruments, before it would otherwise have been due and payable or (2) a default by such party, such Credit Support Provider or such Specified Entity (individually or collectively) in making one or more payments on the due date thereof in an aggregate amount of not less than the applicable Threshold Amount under such agreements or instruments (after giving effect to any applicable notice requirement or grace period);

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(vii)           Bankruptcy.The party, any Credit Support Provider of such party or any applicable Specified Entity of such party:  —

(1)           is dissolved (other than pursuant to a consolidation, amalgamation or merger); (2) becomes insolvent or is unable to pay its debts or fails or admits in writing its inability generally to pay its debts as they become due; (3) makes a general assignment, arrangement or composition with or for the benefit of its creditors; (4) institutes or has instituted against it a proceeding seeking a judgment of insolvency or bankruptcy or any other relief under any bankruptcy or insolvency law or other similar law affecting creditors’ rights, or a petition is presented for its winding-up or liquidation, and, in the case of any such proceeding or petition instituted or presented against it, such proceeding or petition (A) results in a judgment of insolvency or bankruptcy or the entry of an order for relief or the making of an order for its winding-up or liquidation or (B) is not dismissed, discharged, stayed or restrained in each case within 30 days of the institution or presentation thereof; (5) has a resolution passed for its winding-up, official management or liquidation (other than pursuant to a consolidation, amalgamation or merger); (6) seeks or becomes subject to the appointment of an administrator, provisional liquidator, conservator, receiver, trustee, custodian or other similar official for it or for all or substantially all its assets; (7) has a secured party take possession of all or substantially all its assets or has a distress, execution, attachment, sequestration or other legal process levied, enforced or sued on or against all or substantially all its assets and such secured party maintains possession, or any such process is not dismissed, discharged, stayed or restrained, in each case within 30 days thereafter; (8) causes or is subject to any event with respect to it which, under the applicable laws of any jurisdiction, has an analogous effect to any of the events specified in clauses (1) to (7) (inclusive); or (9) takes any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the foregoing acts; or

(viii)           Merger Without Assumption.The party or any Credit Support Provider of such party consolidates or amalgamates with, or merges with or into, or transfers all or substantially all its assets to, another entity and, at the time of such consolidation, amalgamation, merger or transfer:  —

(1)           the resulting, surviving or transferee entity fails to assume all the obligations of such party or such Credit Support Provider under this Agreement or any Credit Support Document to which it or its predecessor was a party by operation of law or pursuant to an agreement reasonably satisfactory to the other party to this Agreement; or

(2)           the benefits of any Credit Support Document fail to extend (without the consent of the other party) to the performance by such resulting, surviving or transferee entity of its obligations under this Agreement.

(b)           Termination Events.The occurrence at any time with respect to a party or, if applicable, any Credit Support Provider of such party or any Specified Entity of such party of any event specified below constitutes an Illegality if the event is specified in (i) below, a Tax Event if the event is specified in (ii) below or a Tax Event Upon Merger if the event is specified in (iii) below, and, if specified to be applicable, a Credit Event Upon Merger if the event is specified pursuant to (iv) below or an Additional Termination Event if the event is specified pursuant to (v) below:—

(i)           Illegality.Due to the adoption of, or any change in, any applicable law after the date on which a Transaction is entered into, or due to the promulgation of, or any change in, the interpretation by any court, tribunal or regulatory authority with competent jurisdiction of any applicable law after such date, it becomes unlawful (other than as a result of a breach by the party of Section 4(b)) for such party (which will be the Affected Party):  —

(1)           to perform any absolute or contingent obligation to make a payment or delivery or to receive a payment or delivery in respect of such Transaction or to comply with any other material provision of this Agreement relating to such Transaction; or

(2)           to perform, or for any Credit Support Provider of such party to perform, any contingent or other obligation which the party (or such Credit Support Provider) has under any Credit Support Document relating to such Transaction;

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(ii)           Tax Event.Due to (x) any action taken by a taxing authority, or brought in a court of competent jurisdiction, on or after the date on which a Transaction is entered into (regardless of whether such action is taken or brought with respect to a party to this Agreement) or (y) a Change in Tax Law, the party (which will be the Affected Party) will, or there is a substantial likelihood that it will, on the next succeeding Scheduled Payment Date (1) be required to pay to the other party an additional amount in respect of an Indemnifiable Tax under Section 2(d)(i)(4) (except in respect of interest under Section 2(e), 6(d)(ii) or 6(e)) or (2) receive a payment from which an amount is required to be deducted or withheld for or on account of a Tax (except in respect of interest under Section 2(e), 6(d)(ii) or 6(e)) and no additional amount is required to be paid in respect of such Tax under Section 2(d)(i)(4) (other than by reason of Section 2(d)(i)(4)(A) or (B));

(iii)           Tax Event Upon Merger.The party (the “Burdened Party”) on the next succeeding Scheduled Payment Date will either (1) be required to pay an additional amount in respect of an Indemnifiable Tax under Section 2(d)(i)(4) (except in respect of interest under Section 2(e), 6(d)(ii) or 6(e)) or (2) receive a payment from which an amount has been deducted or withheld for or on account of any Indemnifiable Tax in respect of which the other party is not required to pay an additional amount (other than by reason of Section 2(d)(i)(4)(A) or (B)), in either case as a result of a party consolidating or amalgamating with, or merging with or into, or transferring all or substantially all its assets to, another entity (which will be the Affected Party) where such action does not constitute an event described in Section 5(a)(viii);

(iv)           Credit Event Upon Merger.  If “Credit Event Upon Merger” is specified in the Schedule as applying to the party, such party (“X”), any Credit Support Provider of X or any applicable Specified Entity of X consolidates or amalgamates with, or merges with or into, or transfers all or substantially all its assets to, another entity and such action does not constitute an event described in Section 5(a)(viii) but the creditworthiness of the resulting, surviving or transferee entity is materially weaker than that of X, such Credit Support Provider or such Specified Entity, as the case may be, immediately prior to such action (and, in such event, X or its successor or transferee, as appropriate, will be the Affected Party); or

(v)           Additional Termination Event.If any “Additional Termination Event” is specified in the Schedule or any Confirmation as applying, the occurrence of such event (and, in such event, the Affected Party or Affected Parties shall be as specified for such Additional Termination Event in the Schedule or such Confirmation).

(c)           Event of Default and Illegality.  If an event or circumstance which would otherwise constitute or give rise to an Event of Default also constitutes an Illegality, it will be treated as an Illegality and will not constitute an Event of Default.

6.  Early Termination

(a)           Right to Terminate Following Event of Default.If at any time an Event of Default with respect to a party (the “Defaulting Party”) has occurred and is then continuing, the other party (the “Non-defaulting Party”) may, by not more than 20 days notice to the Defaulting Party specifying the relevant Event of Default, designate a day not earlier than the day such notice is effective as an Early Termination Date in respect of all outstanding Transactions.  If, however, “Automatic Early Termination” is specified in the Schedule as applying to a party, then an Early Termination Date in respect of all outstanding Transactions will occur immediately upon the occurrence with respect to such party of an Event of Default specified in Section 5(a)(vii)(1), (3), (5), (6) or, to the extent analogous thereto, (8), and as of the time immediately preceding the institution of the relevant proceeding or the presentation of the relevant petition upon the occurrence with respect to such party of an Event of Default specified in Section 5(a)(vii)(4) or, to the extent analogous thereto, (8).

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(b)           Right to Terminate Following Termination Event.

(i)           Notice.If a Termination Event occurs, an Affected Party will, promptly upon becoming aware of it, notify the other party, specifying the nature of that Termination Event and each Affected Transaction and will also give such other information about that Termination Event as the other party may reasonably require.

(ii)           Transfer to Avoid Termination Event.If either an Illegality under Section 5(b)(i)(1) or a Tax Event occurs and there is only one Affected Party, or if a Tax Event Upon Merger occurs and the Burdened Party is the Affected Party, the Affected Party will, as a condition to its right to designate an Early Termination Date under Section 6(b)(iv), use all reasonable efforts (which will not require such party to incur a loss, excluding immaterial, incidental expenses) to transfer within 20 days after it gives notice under Section 6(b)(i) all its rights and obligations under this Agreement in respect of the Affected Transactions to another of its Offices or Affiliates so that such Termination Event ceases to exist.

If the Affected Party is not able to make such a transfer it will give notice to the other party to that effect within such 20 day period, whereupon the other party may effect such a transfer within 30 days after the notice is given under Section 6(b)(i).

Any such transfer by a party under this Section 6(b)(ii) will be subject to and conditional upon the prior written consent of the other party, which consent will not be withheld if such other party’s policies in effect at such time would permit it to enter into transactions with the transferee on the terms proposed.

(iii)           Two Affected Parties.If an Illegality under Section 5(b)(i)(1) or a Tax Event occurs and there are two Affected Parties, each party will use all reasonable efforts to reach agreement within 30 days after notice thereof is given under Section 6(b)(i) on action to avoid that Termination Event.

(iv)           Right to Terminate.  If:  —

(1)           a transfer under Section 6(b)(ii) or an agreement under Section 6(b)(iii), as the case may be, has not been effected with respect to all Affected Transactions within 30 days after an Affected Party gives notice under Section 6(b)(i); or

(2)           an Illegality under Section 5(b)(i)(2), a Credit Event Upon Merger or an Additional Termination Event occurs, or a Tax Event Upon Merger occurs and the Burdened Party is not the Affected Party,

either party in the case of an Illegality, the Burdened Party in the case of a Tax Event Upon Merger, any Affected Party in the case of a Tax Event or an Additional Termination Event if there is more than one Affected Party, or the party which is not the Affected Party in the case of a Credit Event Upon Merger or an Additional Termination Event if there is only one Affected Party may, by not more than 20 days notice to the other party and provided that the relevant Termination Event is then continuing, designate a day not earlier than the day such notice is effective as an Early Termination Date in respect of all Affected Transactions.

(c)           Effect of Designation.

(i)           If notice designating an Early Termination Date is given under Section 6(a) or (b), the Early Termination Date will occur on the date so designated, whether or not the relevant Event of Default or Termination Event is then continuing.

(ii)           Upon the occurrence or effective designation of an Early Termination Date, no further payments or deliveries under Section 2(a)(i) or 2(e) in respect of the Terminated Transactions will be required to be made, but without prejudice to the other provisions of this Agreement.  The amount, if any, payable in respect of an Early Termination Date shall be determined pursuant to Section 6(e).

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(d)           Calculations.

(i)           Statement.On or as soon as reasonably practicable following the occurrence of an Early Termination Date, each party will make the calculations on its part, if any, contemplated by Section 6(e) and will provide to the other party a statement (1) showing, in reasonable detail, such calculations (including all relevant quotations and specifying any amount payable under Section 6(e)) and (2) giving details of the relevant account to which any amount payable to it is to be paid.  In the absence of written confirmation from the source of a quotation obtained in determining a Market Quotation, the records of the party obtaining such quotation will be conclusive evidence of the existence and accuracy of such quotation.

(ii)           Payment Date.An amount calculated as being due in respect of any Early Termination Date under Section 6(e) will be payable on the day that notice of the amount payable is effective (in the case of an Early Termination Date which is designated or occurs as a result of an Event of Default) and on the day which is two Local Business Days after the day on which notice of the amount payable is effective (in the case of an Early Termination Date which is designated as a result of a Termination Event).  Such amount will be paid together with (to the extent permitted under applicable law) interest thereon (before as well as after judgment) in the Termination Currency, from (and including) the relevant Early Termination Date to (but excluding) the date such amount is paid, at the Applicable Rate.  Such interest will be calculated on the basis of daily compounding and the actual number of days elapsed.

(e)           Payments on Early Termination.If an Early Termination Date occurs, the following provisions shall apply based on the parties’ election in the Schedule of a payment measure, either “Market Quotation” or “Loss”, and a payment method, either the “First Method” or the “Second Method”.  If the parties fail to designate a payment measure or payment method in the Schedule, it will be deemed that “Market Quotation” or the “Second Method”, as the case may be, shall apply.  The amount, if any, payable in respect of an Early Termination Date and determined pursuant to this Section will be subject to any Set-off.

(i)           Events of Default.If the Early Termination Date results from an Event of Default:  —

(1)           First Method and Market Quotation.  If the First Method and Market Quotation apply, the Defaulting Party will pay to the Non-defaulting Party the excess, if a positive number, of (A) the sum of the Settlement Amount (determined by the Non-defaulting Party) in respect of the Terminated Transactions and the Termination Currency Equivalent of the Unpaid Amounts owing to the Non-defaulting Party over (B) the Termination Currency Equivalent of the Unpaid Amounts owing to the Defaulting Party.

(2)           First Method and Loss.  If the First Method and Loss apply, the Defaulting Party will pay to the Non-defaulting Party, if a positive number, the Non-defaulting Party’s Loss in respect of this Agreement.

(3)           Second Method and Market Quotation.  If the Second Method and Market Quotation apply, an amount will be payable equal to (A) the sum of the Settlement Amount (determined by the Non-defaulting Party) in respect of the Terminated Transactions and the Termination Currency Equivalent of the Unpaid Amounts owing to the Non-defaulting Party less (B) the Termination Currency Equivalent of the Unpaid Amounts owing to the Defaulting Party.  If that amount is a positive number, the Defaulting Party will pay it to the Non-defaulting Party; if it is a negative number, the Non-defaulting Party will pay the absolute value of that amount to the Defaulting Party.

(4)           Second Method and Loss.  If the Second Method and Loss apply, an amount will be payable equal to the Non-defaulting Party’s Loss in respect of this Agreement.  If that amount is a positive number, the Defaulting Party will pay it to the Non-defaulting Party; if it is a negative number, the Non-defaulting Party will pay the absolute value of that amount to the Defaulting Party.

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(ii)           Termination Events.If the Early Termination Date results from a Termination Event:  —

(1)           One Affected Party.  If there is one Affected Party, the amount payable will be determined in accordance with Section 6(e)(i)(3), if Market Quotation applies, or Section 6(e)(i)(4), if Loss applies, except that, in either case, references to the Defaulting Party and to the Non-defaulting Party will be deemed to be references to the Affected Party and the party which is not the Affected Party, respectively, and, if Loss applies and fewer than all the Transactions are being terminated, Loss shall be calculated in respect of all Terminated Transactions.

(2)           Two Affected Parties.  If there are two Affected Parties:  —

(A)           if Market Quotation applies, each party will determine a Settlement Amount in respect of the Terminated Transactions, and an amount will be payable equal to (I) the sum of (a) one-half of the difference between the Settlement Amount of the party with the higher Settlement Amount (“X”) and the Settlement Amount of the party with the lower Settlement Amount (“Y”) and (b) the Termination Currency Equivalent of the Unpaid Amounts owing to X less (II) the Termination Currency Equivalent of the Unpaid Amounts owing to Y; and

(B)           if Loss applies, each party will determine its Loss in respect of this Agreement (or, if fewer than all the Transactions are being terminated, in respect of all Terminated Transactions) and an amount will be payable equal to one-half of the difference between the Loss of the party with the higher Loss (“X”) and the Loss of the party with the lower Loss (“Y”).

If the amount payable is a positive number, Y will pay it to X; if it is a negative number, X will pay the absolute value of that amount to Y.

(iii)           Adjustment for Bankruptcy.In circumstances where an Early Termination Date occurs because “Automatic Early Termination” applies in respect of a party, the amount determined under this Section 6(e) will be subject to such adjustments as are appropriate and permitted by law to reflect any payments or deliveries made by one party to the other under this Agreement (and retained by such other party) during the period from the relevant Early Termination Date to the date for payment determined under Section 6(d)(ii).

(iv)           Pre-Estimate.The parties agree that if Market Quotation applies an amount recoverable under this Section 6(e) is a reasonable pre-estimate of loss and not a penalty.  Such amount is payable for the loss of bargain and the loss of protection against future risks and except as otherwise provided in this Agreement neither party will be entitled to recover any additional damages as a consequence of such losses.

7.  Transfer

Subject to Section 6(b)(ii), neither this Agreement nor any interest or obligation in or under this Agreement may be transferred (whether by way of security or otherwise) by either party without the prior written consent of the other party, except that:  —

(a)           a party may make such a transfer of this Agreement pursuant to a consolidation or amalgamation with, or merger with or into, or transfer of all or substantially all its assets to, another entity (but without prejudice to any other right or remedy under this Agreement); and

(b)           a party may make such a transfer of all or any part of its interest in any amount payable to it from a Defaulting Party under Section 6(e).

Any purported transfer that is not in compliance with this Section will be void.

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8.  Contractual Currency

(a)           Payment in the Contractual Currency.Each payment under this Agreement will be made in the relevant currency specified in this Agreement for that payment (the “Contractual Currency”).  To the extent permitted by applicable law, any obligation to make payments under this Agreement in the Contractual Currency will not be discharged or satisfied by any tender in any currency other than the Contractual Currency, except to the extent such tender results in the actual receipt by the party to which payment is owed, acting in a reasonable manner and in good faith in converting the currency so tendered into the Contractual Currency, of the full amount in the Contractual Currency of all amounts payable in respect of this Agreement.  If for any reason the amount in the Contractual Currency so received falls short of the amount in the Contractual Currency payable in respect of this Agreement, the party required to make the payment will, to the extent permitted by applicable law, immediately pay such additional amount in the Contractual Currency as may be necessary to compensate for the shortfall.  If for any reason the amount in the Contractual Currency so received exceeds the amount in the Contractual Currency payable in respect of this Agreement, the party receiving the payment will refund promptly the amount of such excess.

(b)           Judgments.To the extent permitted by applicable law, if any judgment or order expressed in a currency other than the Contractual Currency is rendered (i) for the payment of any amount owing in respect of this Agreement, (ii) for the payment of any amount relating to any early termination in respect of this Agreement or (iii) in respect of a judgment or order of another court for the payment of any amount described in (i) or (ii) above, the party seeking recovery, after recovery in full of the aggregate amount to which such party is entitled pursuant to the judgment or order, will be entitled to receive immediately from the other party the amount of any shortfall of the Contractual Currency received by such party as a consequence of sums paid in such other currency and will refund promptly to the other party any excess of the Contractual Currency received by such party as a consequence of sums paid in such other currency if such shortfall or such excess arises or results from any variation between the rate of exchange at which the Contractual Currency is converted into the currency of the judgment or order for the purposes of such judgment or order and the rate of exchange at which such party is able, acting in a reasonable manner and in good faith in converting the currency received into the Contractual Currency, to purchase the Contractual Currency with the amount of the currency of the judgment or order actually received by such party.  The term “rate of exchange” includes, without limitation, any premiums and costs of exchange payable in connection with the purchase of or conversion into the Contractual Currency.

(c)           Separate Indemnities.To the extent permitted by applicable law, these indemnities constitute separate and independent obligations from the other obligations in this Agreement, will be enforceable as separate and independent causes of action, will apply notwithstanding any indulgence granted by the party to which any payment is owed and will not be affected by judgment being obtained or claim or proof being made for any other sums payable in respect of this Agreement.

(d)           Evidence of Loss.For the purpose of this Section 8, it will be sufficient for a party to demonstrate that it would have suffered a loss had an actual exchange or purchase been made.

9.  Miscellaneous

(a)           Entire Agreement.This Agreement constitutes the entire agreement and understanding of the parties with respect to its subject matter and supersedes  all oral communication and prior writings with respect thereto.

(b)           Amendments.No amendment, modification or waiver in respect of this Agreement will be effective unless in writing (including a writing evidenced by a facsimile transmission) and executed by each of the parties or confirmed by an exchange of telexes or electronic messages on an electronic messaging system.

(c)           Survival of Obligations.Without prejudice to Sections 2(a)(iii) and 6(c)(ii), the obligations of the parties under this Agreement will survive the termination of any Transaction.

(d)           Remedies Cumulative.Except as provided in this Agreement, the rights, powers, remedies and privileges provided in this Agreement are cumulative and not exclusive of any rights, powers, remedies and privileges provided by law.

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(e)           Counterparts and Confirmations.

(i)           This Agreement (and each amendment, modification and waiver in respect of it) may be executed and delivered in counterparts (including by facsimile transmission), each of which will be deemed an original.

(ii)           The parties intend that they are legally bound by the terms of each Transaction from the moment they agree to those terms (whether orally or otherwise).  A Confirmation shall be entered into as soon as practicable and may be executed and delivered in counterparts (including by facsimile transmission) or be created by an exchange of telexes or by an exchange of electronic messages on an electronic messaging system, which in each case will be sufficient for all purposes to evidence a binding supplement to this Agreement.  The parties will specify therein or through another effective means that any such counterpart, telex or electronic message constitutes a Confirmation.

(f)           No Waiver of Rights.A failure or delay in exercising any right, power or privilege in respect of this Agreement will not be presumed to operate as a waiver, and a single or partial exercise of any right, power or privilege will not be presumed to preclude any subsequent or further exercise, of that right, power or privilege or the exercise of any other right, power or privilege.

(g)           Headings.The headings used in this Agreement are for convenience of reference only and are not to affect the construction of or to be taken into consideration in interpreting this Agreement.

10.  Offices; Multibranch Parties

(a)           If Section 10(a) is specified in the Schedule as applying, each party that enters into a Transaction through an Office other than its head or home office represents to the other party that, notwithstanding the place of booking office or jurisdiction of incorporation or organisation of such party, the obligations of such party are the same as if it had entered into the Transaction through its head or home office.  This representation will be deemed to be repeated by such party on each date on which a Transaction is entered into.

(b)           Neither party may change the Office through which it makes and receives payments or deliveries for the purpose of a Transaction without the prior written consent of the other party.

(c)           If a party is specified as a Multibranch Party in the Schedule, such Multibranch Party may make and receive payments or deliveries under any Transaction through any Office listed in the Schedule, and the Office through which it makes and receives payments or deliveries with respect to a Transaction will be specified in the relevant Confirmation.

11.  Expenses

A Defaulting Party will, on demand, indemnify and hold harmless the other party for and against all reasonable out-of-pocket expenses, including legal fees and Stamp Tax, incurred by such other party by reason of the enforcement and protection of its rights under this Agreement or any Credit Support Document to which the Defaulting Party is a party or by reason of the early termination of any Transaction, including, but not limited to, costs of collection.

12.  Notices

(a)           Effectiveness.Any notice or other communication in respect of this Agreement may be given in any manner set forth below (except that a notice or other communication under Section 5 or 6 may not be given by facsimile transmission or electronic messaging system) to the address or number or in accordance with the electronic messaging system details provided (see the Schedule) and will be deemed effective as indicated:—

(i)           if in writing and delivered in person or by courier, on the date it is delivered;

(ii)           if sent by telex, on the date the recipient’s answerback is received;

(iii)           if sent by facsimile transmission, on the date that transmission is received by a responsible employee of the recipient in legible form (it being agreed that the burden of proving receipt will be on the sender and will not be met by a transmission report generated by the sender’s facsimile machine);

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(iv)           if sent by certified or registered mail (airmail, if overseas) or the equivalent (return receipt requested), on the date that mail is delivered or its delivery is attempted; or

(v)           if sent by electronic messaging system, on the date that electronic message is received,

unless the date of that delivery (or attempted delivery) or that receipt, as applicable, is not a Local Business Day or that communication is delivered (or attempted) or received, as applicable, after the close of business on a Local Business Day, in which case that communication shall be deemed given and effective on the first following day that is a Local Business Day.

(b)           Change of Addresses.Either party may by notice to the other change the address, telex or facsimile number or electronic messaging system details at which notices or other communications are to be given to it.

13.  Governing Law and Jurisdiction

(a)           Governing Law.This Agreement will be governed by and construed in accordance with the law specified in the Schedule.

(b)           Jurisdiction.With respect to any suit, action or proceedings relating to this Agreement (“Proceedings”), each party irrevocably:—

(i)           submits to the jurisdiction of the English courts, if this Agreement is expressed to be governed by English law, or to the non-exclusive jurisdiction of the courts of the State of New York and the United States District Court located in the Borough of Manhattan in New York City, if this Agreement is expressed to be governed by the laws of the State of New York; and

(ii)           waives any objection which it may have at any time to the laying of venue of any Proceedings brought in any such court, waives any claim that such Proceedings have been brought in an inconvenient forum and further waives the right to object, with respect to such Proceedings, that such court does not have any jurisdiction over such party.

Nothing in this Agreement precludes either party from bringing Proceedings in any other jurisdiction (outside, if this Agreement is expressed to be governed by English law, the Contracting States, as defined in Section 1(3) of the Civil Jurisdiction and Judgments Act 1982 or any modification, extension or re-enactment thereof for the time being in force) nor will the bringing of Proceedings in any one or more jurisdictions preclude the bringing of Proceedings in any other jurisdiction.

(c)           Service of Process.Each party irrevocably appoints the Process Agent (if any) specified opposite its name in the Schedule to receive, for it and on its behalf, service of process in any Proceedings.  If for any reason any party’s Process Agent is unable to act as such, such party will promptly notify the other party and within 30 days appoint a substitute process agent acceptable to the other party.  The parties irrevocably consent to service of process given in the manner provided for notices in Section 12.  Nothing in this Agreement will affect the right of either party to serve process in any other manner permitted by law.

(d)           Waiver of Immunities.Each party irrevocably waives, to the fullest extent permitted by applicable law, with respect to itself and its revenues and assets (irrespective of their use or intended use), all immunity on the grounds of sovereignty or other similar grounds from (i) suit, (ii) jurisdiction of any court, (iii) relief by way of injunction, order for specific performance or for recovery of property, (iv) attachment of its assets (whether before or after judgment) and (v) execution or enforcement of any judgment to which it or its revenues or assets might otherwise be entitled in any Proceedings in the courts of any jurisdiction and irrevocably agrees, to the extent permitted by applicable law, that it will not claim any such immunity in any Proceedings.

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14.  Definitions

As used in this Agreement:—

“Additional Termination Event”has the meaning specified in Section 5(b).

“Affected Party”has the meaning specified in Section 5(b).

“Affected Transactions”means (a) with respect to any Termination Event consisting of an Illegality, Tax Event or Tax Event Upon Merger, all Transactions affected by the occurrence of such Termination Event and (b) with respect to any other Termination Event, all Transactions.

“Affiliate”means, subject to the Schedule, in relation to any person, any entity controlled, directly or indirectly, by the person, any entity that controls, directly or indirectly, the person or any entity directly or indirectly under common control with the person.  For this purpose, “control” of any entity or person means ownership of a majority of the voting power of the entity or person.

“Applicable Rate”means:—

(a)           in respect of obligations payable or deliverable (or which would have been but for Section 2(a)(iii)) by a Defaulting Party, the Default Rate;

(b)           in respect of an obligation to pay an amount under Section 6(e) of either party from and after the date (determined in accordance with Section 6(d)(ii)) on which that amount is payable, the Default Rate;

(c)           in respect of all other obligations payable or deliverable (or which would have been but for Section 2(a)(iii)) by a Non-defaulting Party, the Non-default Rate; and

(d)           in all other cases, the Termination Rate.

“Burdened Party”has the meaning specified in Section 5(b).

“Change in Tax Law” means the enactment, promulgation, execution or ratification of, or any change in or amendment to, any law (or in the application or official interpretation of any law) that occurs on or after the date on which the relevant Transaction is entered into.

“consent”includes a consent, approval, action, authorisation, exemption, notice, filing, registration or exchange control consent.

“Credit Event Upon Merger”has the meaning specified in Section 5(b).

“Credit Support Document”means any agreement or instrument that is specified as such in this Agreement.

“Credit Support Provider”has the meaning specified in the Schedule.

“Default Rate”means a rate per annum equal to the cost (without proof or evidence of any actual cost) to the relevant payee (as certified by it) if it were to fund or of funding the relevant amount plus 1% per annum.

“Defaulting Party”has the meaning specified in Section 6(a).

“Early Termination Date”means the date determined in accordance with Section 6(a) or 6(b)(iv).

“Event of Default”has the meaning specified in Section 5(a) and, if applicable, in the Schedule.

“Illegality”has the meaning specified in Section 5(b).

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“Indemnifiable Tax”means any Tax other than a Tax that would not be imposed in respect of a payment under this Agreement but for a present or former connection between the jurisdiction of the government or taxation authority imposing such Tax and the recipient of such payment or a person related to such recipient (including, without limitation, a connection arising from such recipient or related person being or having been a citizen or resident of such jurisdiction, or being or having been organised, present or engaged in a trade or business in such jurisdiction, or having or having had a permanent establishment or fixed place of business in such jurisdiction, but excluding a connection arising solely from such recipient or related person having executed, delivered, performed its obligations or received a payment under, or enforced, this Agreement or a Credit Support Document).

“law”includes any treaty, law, rule or regulation (as modified, in the case of tax matters, by the practice of any relevant governmental revenue authority) and “lawful”and “unlawful”will be construed accordingly.

“Local Business Day”means, subject to the Schedule, a day on which commercial banks are open for business (including dealings in foreign exchange and foreign currency deposits) (a) in relation to any obligation under Section 2(a)(i), in the place(s) specified in the relevant Confirmation or, if not so specified, as otherwise agreed by the parties in writing or determined pursuant to provisions contained, or incorporated by reference, in this Agreement, (b) in relation to any other payment, in the place where the relevant account is located and, if different, in the principal financial centre, if any, of the currency of such payment, (c) in relation to any notice or other communication, including notice contemplated under Section 5(a)(i), in the city specified in the address for notice provided by the recipient and, in the case of a notice contemplated by Section 2(b), in the place where the relevant new account is to be located and (d) in relation to Section 5(a)(v)(2), in the relevant locations for performance with respect to such Specified Transaction.

“Loss”means, with respect to this Agreement or one or more Terminated Transactions, as the case may be, and a party, the Termination Currency Equivalent of an amount that party reasonably determines in good faith to be its total losses and costs (or gain, in which case expressed as a negative number) in connection with this Agreement or that Terminated Transaction or group of Terminated Transactions, as the case may be, including any loss of bargain, cost of funding or, at the election of such party but without duplication, loss or cost incurred as a result of its terminating, liquidating, obtaining or reestablishing any hedge or related trading position (or any gain resulting from any of them).  Loss includes losses and costs (or gains) in respect of any payment or delivery required to have been made (assuming satisfaction of each applicable condition precedent) on or before the relevant Early Termination Date and not made, except, so as to avoid duplication, if Section 6(e)(i)(1) or (3) or 6(e)(ii)(2)(A) applies.  Loss does not include a party’s legal fees and out-of-pocket expenses referred to under Section 11.  A party will determine its Loss as of the relevant Early Termination Date, or, if that is not reasonably practicable, as of the earliest date thereafter as is reasonably practicable.  A party may (but need not) determine its Loss by reference to quotations of relevant rates or prices from one or more leading dealers in the relevant markets.

“Market Quotation”means, with respect to one or more Terminated Transactions and a party making the determination, an amount determined on the basis of quotations from Reference Market-makers.  Each quotation will be for an amount, if any, that would be paid to such party (expressed as a negative number) or by such party (expressed as a positive number) in consideration of an agreement between such party (taking into account any existing Credit Support Document with respect to the obligations of such party) and the quoting Reference Market-maker to enter into a transaction (the “Replacement Transaction”) that would have the effect of preserving for such party the economic equivalent of any payment or delivery (whether the underlying obligation was absolute or contingent and assuming the satisfaction of each applicable condition precedent) by the parties under Section 2(a)(i) in respect of such Terminated Transaction or group of Terminated Transactions that would, but for the occurrence of the relevant Early Termination Date, have been required after that date.  For this purpose, Unpaid Amounts in respect of the Terminated Transaction or group of Terminated Transactions are to be excluded but, without limitation, any payment or delivery that would, but for the relevant Early Termination Date, have been required (assuming satisfaction of each applicable condition precedent) after that Early Termination Date is to be included.  The Replacement Transaction would be subject to such documentation as such party and the Reference Market-maker may, in good faith, agree.  The party making the determination (or its agent) will request each Reference Market-maker to provide its quotation to the extent reasonably practicable as of the same day and time (without regard to different time zones) on or as soon as reasonably practicable after the relevant Early Termination Date.  The day and time as of which those quotations are to be obtained will be selected in good faith by the party obliged to make a determination under Section 6(e), and, if each party is so obliged, after consultation with the other.  If more than three quotations are provided, the Market Quotation will be the arithmetic mean of the quotations, without regard to the quotations having the highest and lowest values.  If exactly three such quotations are provided, the Market Quotation will be the quotation remaining after disregarding the highest and lowest quotations.  For this purpose, if more than one quotation has the same highest value or lowest value, then one of such quotations shall be disregarded.  If fewer than three quotations are provided, it will be deemed that the Market Quotation in respect of such Terminated Transaction or group of Terminated Transactions cannot be determined.

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“Non-default Rate”means a rate per annum equal to the cost (without proof or evidence of any actual cost) to the Non-defaulting Party (as certified by it) if it were to fund the relevant amount.

“Non-defaulting Party”has the meaning specified in Section 6(a).

“Office”means a branch or office of a party, which may be such party’s head or home office.

“Potential Event of Default”means any event which, with the giving of notice or the lapse of time or both, would constitute an Event of Default.

“Reference Market-makers”means four leading dealers in the relevant market selected by the party determining a Market Quotation in good faith (a) from among dealers of the highest credit standing which satisfy all the criteria that such party applies generally at the time in deciding whether to offer or to make an extension of credit and (b) to the extent practicable, from among such dealers having an office in the same city.

“Relevant Jurisdiction”means, with respect to a party, the jurisdictions (a) in which the party is incorporated, organised, managed and controlled or considered to have its seat, (b) where an Office through which the party is acting for purposes of this Agreement is located, (c) in which the party executes this Agreement and (d) in relation to any payment, from or through which such payment is made.

“Scheduled Payment Date” means a date on which a payment or delivery is to be made under Section 2(a)(i) with respect to a Transaction.

“Set-off”means set-off, offset, combination of accounts, right of retention or withholding or similar right or requirement to which the payer of an amount under Section 6 is entitled or subject (whether arising under this Agreement, another contract, applicable law or otherwise) that is exercised by, or imposed on, such payer.

“Settlement Amount”means, with respect to a party and any Early Termination Date, the sum of:  —

(a)           the Termination Currency Equivalent of the Market Quotations (whether positive or negative) for each Terminated Transaction or group of Terminated Transactions for which a Market Quotation is determined; and

(b)           such party’s Loss (whether positive or negative and without reference to any Unpaid Amounts) for each Terminated Transaction or group of Terminated Transactions for which a Market Quotation cannot be determined or would not (in the reasonable belief of the party making the determination) produce a commercially reasonable result.

“Specified Entity”has the meanings specified in the Schedule.

“Specified Indebtedness”means, subject to the Schedule, any obligation (whether present or future, contingent or otherwise, as principal or surety or otherwise) in respect of borrowed money.

“Specified Transaction” means, subject to the Schedule, (a) any transaction (including an agreement with respect thereto) now existing or hereafter entered into between one party to this Agreement (or any Credit Support Provider of such party or any applicable Specified Entity of such party) and the other party to this Agreement (or any Credit Support Provider of such other party or any applicable Specified Entity of such other party) which is a rate swap transaction, basis swap, forward rate transaction, commodity swap, commodity option, equity or equity index swap, equity or equity index option, bond option, interest rate option, foreign exchange transaction, cap transaction, floor transaction, collar transaction, currency swap transaction, cross-currency rate swap transaction, currency option or any other similar transaction (including any option with respect to any of these transactions), (b) any combination of these transactions and (c) any other transaction identified as a Specified Transaction in this Agreement or the relevant confirmation.

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“Stamp Tax”means any stamp, registration, documentation or similar tax.

“Tax”means any present or future tax, levy, impost, duty, charge, assessment or fee of any nature (including interest, penalties and additions thereto) that is imposed by any government or other taxing authority in respect of any payment under this Agreement other than a stamp, registration, documentation or similar tax.

“Tax Event”has the meaning specified in Section 5(b).

“Tax Event Upon Merger”has the meaning specified in Section 5(b).

“Terminated Transactions”means with respect to any Early Termination Date (a) if resulting from a Termination Event, all Affected Transactions and (b) if resulting from an Event of Default, all Transactions (in either case) in effect immediately before the effectiveness of the notice designating that Early Termination Date (or, if “Automatic Early Termination” applies, immediately before that Early Termination Date).

“Termination Currency”has the meaning specified in the Schedule.

“Termination Currency Equivalent”means, in respect of any amount denominated in the Termination Currency, such Termination Currency amount and, in respect of any amount denominated in a currency other than the Termination Currency (the “Other Currency”), the amount in the Termination Currency determined by the party making the relevant determination as being required to purchase such amount of such Other Currency as at the relevant Early Termination Date, or, if the relevant Market Quotation or Loss (as the case may be), is determined as of a later date, that later date, with the Termination Currency at the rate equal to the spot exchange rate of the foreign exchange agent (selected as provided below) for the purchase of such Other Currency with the Termination Currency at or about 11:00 a.m. (in the city in which such foreign exchange agent is located) on such date as would be customary for the determination of such a rate for the purchase of such Other Currency for value on the relevant Early Termination Date or that later date.  The foreign exchange agent will, if only one party is obliged to make a determination under Section 6(e), be selected in good faith by that party and otherwise will be agreed by the parties.

“Termination Event”means an Illegality, a Tax Event or a Tax Event Upon Merger or, if specified to be applicable, a Credit Event Upon Merger or an Additional Termination Event.

“Termination Rate”means a rate per annum equal to the arithmetic mean of the cost (without proof or evidence of any actual cost) to each party (as certified by such party) if it were to fund or of funding such amounts.

“Unpaid Amounts”owing to any party means, with respect to an Early Termination Date, the aggregate of (a) in respect of all Terminated Transactions, the amounts that became payable (or that would have become payable but for Section 2(a)(iii)) to such party under Section 2(a)(i) on or prior to such Early Termination Date and which remain unpaid as at such Early Termination Date and (b) in respect of each Terminated Transaction, for each obligation under Section 2(a)(i) which was (or would have been but for Section 2(a)(iii)) required to be settled by delivery to such party on or prior to such Early Termination Date and which has not been so settled as at such Early Termination Date, an amount equal to the fair market value of that which was (or would have been) required to be delivered as of the originally scheduled date for delivery, in each case together with (to the extent permitted under applicable law) interest, in the currency of such amounts, from (and including) the date such amounts or obligations were or would have been required to have been paid or performed to (but excluding) such Early Termination Date, at the Applicable Rate.  Such amounts of interest will be calculated on the basis of daily compounding and the actual number of days elapsed.  The fair market value of any obligation referred to in clause (b) above shall be reasonably determined by the party obliged to make the determination under Section 6(e) or, if each party is so obliged, it shall be the average of the Termination Currency Equivalents of the fair market values reasonably determined by both parties.

  ISDA ® 1992

17

IN WITNESS WHEREOF the parties have executed this document on the respective dates specified below with effect from the date specified on the first page of this document.

RBS Citizens, N.A. ……………………...………………… (Name of Party)	Franklin Street Properties Corp ……………………...………………… (Name of Party
By: /s/ Michael J. Liberatore       ……………………………………. Name: Michael J. Liberatore Title: AVP Date: 10/15/08	By:  /s/ George J. Carter  ……………………...………………………………….. Name: George J. Carter Title: President + Chief Executive Officer Date:

  ISDA ® 1992

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SCHEDULE

to the

MASTER AGREEMENT

dated as of October 15, 2008

between

RBS CITIZENS, N.A. (“Party A”) and FRANKLIN STREET PROPERTIES, a corporation organized under the laws of the State of Maryland (“Party B”)

PART 1

Termination Provisions

In this Agreement:

(a)           “Specified Entity” means, in relation to Party A, for the purpose of:

Section 5(a)(v), NONE

Section 5(a)(vi), NONE

Section 5(a)(vii), NONE

Section 5(b)(iv), NONE

and, in relation to Party B, for the purpose of:

Section 5(a)(v), NONE

Section 5(a)(vi), NONE

Section 5(a)(vii), NONE

Section 5(b)(iv), NONE.

(b)           Event of Default.  Section 5(a) is hereby amended by adding the following paragraph at the end thereof:

Notwithstanding the foregoing, Party B will not be deemed in default hereunder (and an Event of Default with respect to Party B shall not be deemed to have occurred) to the extent (and only to the extent) that  the type of event or circumstance giving rise to the Event of Default under this Agreement is specifically included as a type of event of default (however described) under the Credit Support Document and no Event of Default under the Credit Support Document has  occurred and is continuing as a result of  such event or circumstance.

(c)             The “Cross-Default” provisions of Section 5(a)(vi) will apply to both parties but shall exclude any default that results solely from wire transfer difficulties or an error or omission of an administrative or operational nature (so long as sufficient funds are available to the relevant party on the relevant date), but only if payment is made within three Local Business Days after such transfer difficulties have been corrected or the error or omission has been discovered. In addition, Section 5(a)(vi)(1) of the Master Agreement is hereby amended by: (i)  inserting the following immediately before “or (2)”  “; provided that Section 5(a)(vi) shall not apply to secured indebtedness that becomes due as a result of the voluntary sale or transfer of the property or assets securing such indebtedness”;  and (ii) Section 5(a)(vi) of this Agreement is hereby amended by deleting the words “, or becoming capable at such time of being declared,”.

If such provisions apply:

“Specified Indebtedness” (i) will have the meaning specified in Section 14 with respect to Party A except that indebtedness or obligations in respect of deposits received in the ordinary course of the banking business for such person shall not constitute Specified Indebtedness; and (ii) with respect to Party B, will mean the Credit Support Document specified in Part 4, section (f) below.

“Threshold Amount” means

(i) with respect to Party A, 2% of “Total Capital and Reserves” of Citizens Financial Group, Inc. as shown on the most recent annual audited financial statements of Citizens Financial Group, Inc. and

(ii) with respect to Party B, the lesser of U.S. Dollars 10,000,000 or 2% of the stockholders’ equity (however described) of Party B as shown on the most recent annual audited financial statements of Party B.

(d) The “Credit Event Upon Merger” provisions of Section 5(b)(iv) will apply to Party A and will not apply to Party B.

(e) The “Automatic Early Termination” provision of Section 6(a) will not apply to Party A or Party B.

(f) Payments on Early Termination.  For the purpose of Section 6(e) of this Agreement:

(i)           Market Quotation will apply.

(ii)           The Second Method will apply.

(g) “Termination Currency” means United States Dollars.

(h)

(i) “Additional Termination Event” will apply to Party B.  The following shall constitute an Additional Termination Event for Party B: the expiration or termination of any Credit Support Document or the failing or ceasing of such Credit Support Document to be in full force and effect for the purpose of this Agreement prior to the satisfaction of all obligations of such party under each Transaction, ; provided that it shall not constitute an Additional Termination Event if Party B shall have entered into an alternate form of credit support reasonably acceptable to Party A in its discretion exercised in good faith.

(ii) The following shall constitute an Additional Termination Event for Party A: Ratings Change. On any date, either Moody’s or S&P assigns a rating below the Rating Threshold (as defined below), or fails to assign a rating, to the unsecured, unguaranteed and unsupported senior long-term debt or other similar obligations (“Rated Obligations”) of Party A. As used with respect to this Additional Termination Event, (x) “Moody’s” means Moody’s Investors Service, Inc., or any successor nationally recognised statistical rating organization, (y) “S&P” means Standard & Poor’s Ratings Services, or any successor nationally recognised statistical rating organization, and (z) “Rating Threshold” means (A) with respect to Moody’s, “Baa” and (B) with respect to S&P, BBB. For purposes of this Additional Termination Event, Party A will be the sole Affected Party, and all Transactions will be Affected Transactions.

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PART 2

Tax Representations

(a) Payer Tax Representation.  For the purpose of Section 3(e), Party A and Party B hereby make the following representation:

It is not required by any applicable law, as modified by the practice of any relevant governmental revenue authority, of any Relevant Jurisdiction to make any deduction or withholding for or on account of any Tax from any payment (other than interest under Section 2(e), 6(d)(ii) or 6(e)) to be made by it to the other party under this Agreement.  In making this representation, it may rely on:

(i) the accuracy of any representation made by the other party pursuant to Section 3(f);

(ii) the satisfaction of the agreement of the other party contained in Section 4(a)(i) or 4(a)(iii) and the accuracy and effectiveness of any document provided by the other party pursuant to Section 4(a)(i) or 4(a)(iii); and

(iii) the satisfaction of the agreement of the other party contained in Section 4(d);

provided that it shall not be a breach of this representation where reliance is placed on clause (ii) and the other party does not deliver a form or document under Section 4(a)(iii) by reason of material prejudice to its legal or commercial position

(b) Payee Tax Representations.  For the purpose of Sections 3(f), Party A and Party B hereby make the representation(s) specified below:

(i) The following representation applies to Party A:

Party A is a national bank organized under the laws of the United States of America.

(ii) The following representation applies to Party B:

Party B is a corporation organized under the laws of the State of Maryland.

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PART 3

Agreement to Deliver Documents

For the purpose of Sections 4(a)(i) and (ii) of this Agreement, each party agrees to deliver the following documents, as applicable:

Party required to deliver document	Form/Document/ Certificate	Date by which to be delivered	Covered by Section 3(d) Representation
Party A and Party B	Signature authentication satisfactory to the other party.	On or before execution of this Agreement	Yes
Party A	IRS Form W-9 or any successor form thereto.	On or before execution of this Agreement	No
Party B	Copy (certified by an officer) of the board resolution (or equivalent authorizing documentation) permitting the entering into of this Agreement and Transactions hereunder in the form satisfactory to the other party.	On or before execution of this Agreement	Yes

PART 4

Miscellaneous

(a)           Address for Notices.  For the purpose of Section 12(a) of this Agreement:

(i)           All notices or communications to Party A shall, with respect to a particular Transaction, be sent to the address, telex number, or facsimile number reflected in the Confirmation of that Transaction, and any notice for purposes of Sections 5 or 6 shall be sent to:

Address:           RBS Citizens, N.A.

One Citizens Plaza

Providence, RI 02903

Attention:         Mr. Michael Smith

Treasury Operations

Telephone:       (401) 282-7250

Facsimile:         (401) 282-7718

E-Mail:              michael.smith@citizensbank.com

with a mandatory copy to:

Address:           RBS Citizens, N.A.

One Citizens Plaza

Providence, RI 02903

Attention:        Daniel Ouellette

Telephone:      (617) 725-5602

Facsimile:         (617) 725-5695

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(ii) All notices or communications to Party B shall be sent to the address, telex number, or facsimile number reflected  below:

Address:  Franklin Street Properties Corp.

401 Edgewater Place, Suite 200

Wakefield, MA 01880

Attention: John Demeritt

Telephone No.: (781) 557-1341

Facsimile No.: (781) 246-2807

with copies  to:

Address:          Chatham Financial Corporation

235 Whitehorse Lane

Kenneth Square, PA 19348

Attention:        Amanda Breslin

Telephone:       (610) 925-3126

Facsimile:         (610) 925-3125

(b) Process Agent.  For the purpose of Section 13(c):

Party A appoints as its Process Agent:  Not applicable.

Party B appoints as its Process Agent:  Not applicable.

(c) Offices.  Section 10(a) will apply to this Agreement.

d) Multibranch Party.  For the purpose of Section 10 of this Agreement:

(i) Party A is not a Multibranch Party.

(ii) Party B is not a Multibranch Party.

(e) Calculation Agent.  The Calculation Agent is Party A, provided, that if an Event of Default with respect to Party A has occurred and is continuing, the parties agree to appoint jointly and expeditiously an independent leading dealer in the relevant underlying market to make the relevant calculation.  Such dealer shall be selected in good faith from among dealers of the highest credit standing and such dealer’s calculation shall be binding and conclusive absent manifest error.  All calculations and determinations by Party A shall be made in good faith and in a commercially reasonable manner and are subject to agreement by Party B.  If the parties are unable to agree on a particular calculation or determination, the parties will designate a mutually acceptable leading dealer in good standing in the relevant market to make the calculation or determination.  If the parties are unable to agree on a leading dealer, then each party shall appoint a leading dealer in good standing in the relevant market and the appointed leading dealers shall together appoint a third leading dealer as Calculation Agent for making the relevant calculation or determination.  The failure of Party A to perform its obligations as Calculation Agent hereunder shall not constitute an Event of Default or Termination Event; provided, however, that the parties shall designate a mutually acceptable leading dealer as the interim Calculation Agent.

(f) Credit Support Document.  Details of any Credit Support Document:

With respect to Party A:  Not applicable.

5

With respect to Party B:    Term Loan Agreement dated October 15, 2008, as amended, modified, supplemented or replaced and in effect from time to time, by and among (i) Party B and certain of its wholly owned subsidiaries, as borrowers, (ii) Party A, as Agent, and (iii) Party A,  Bank of America, N.A., and Wachovia Bank, National Association, as lenders, together with any other lenders which may become party thereto in accordance with the terms thereof.

(g) Credit Support Provider. Credit Support Provider means: NOT APPLICABLE.

(h) Governing Law.  This Agreement will be governed by and construed in accordance with the laws of the State of New York (without reference to choice of law doctrine).

(i) Netting of Payments. Subparagraph (ii) of Section 2(c) of this Agreement will apply.

(j) “Affiliate” will have the meaning specified in Section 14 of this Agreement.

(k) Transfer.  The following sentence is hereby added to the end of Section 7.:

”Notwithstanding anything to the contrary in Section 7 of this Agreement, (a) Party A may assign its rights and obligations under this Agreement, in whole and not in part, to any Affiliate of Party A effective upon delivery to Party B of notice of such transfer, provided that such Affiliate shall have credit ratings of at least Baa from Moody’s and BBB from S&P and shall have the requisite assets capable of fulfilling its obligations under this Agreement; and (b) any transferee of this Agreement shall upon such transfer (i) be deemed to enter into a new ISDA Master Agreement with Party B on the same terms as this Agreement,  (ii) prior to the effectiveness of the transfer, deliver any deliverables required under Part 3 of this Schedule; and (iii) no such transfer shall result in any increased costs to Party B.

PART 5

Other Provisions

(a) Definitions.  The definitions and provisions contained in the 2006 ISDA Definitions (the “2006 ISDA Definitions”) as published by the International Swaps and Derivatives Association, Inc. are herby incorporated into this Agreement by reference.  For these purposes, all references in the 2006 ISDA Definitions to a “Swap Transaction” shall be deemed to apply to each Transaction entered into hereunder.

(b) Set-off. Without affecting the provisions of this Agreement requiring the calculation of certain net payment amounts, all payments under this Agreement will be made without set-off or counterclaim; provided, however, that upon the designation of any Early Termination Date, in addition to and not in limitation of any other right or remedy (including any right to set off, counterclaim, or otherwise withhold payment or any recourse to any Credit Support Document) under applicable law the Non-defaulting Party or Non-affected Party (in either case “X”) may without prior notice to any person set off any sum or obligation (whether or not arising under this Agreement and whether matured or unmatured, whether or not contingent and irrespective of the currency, place of payment or booking office of the sum or obligation) owed by the Defaulting Party or Affect Party (in either case, “Y”) to X against any sum or obligation (whether or not arising under this Agreement and whether matured or unmatured, whether or not contingent and irrespective of the currency, place of payment or booking office of the sum or obligations) owed by X to Y and, for this purpose, may convert one currency into another at a market rate determined by X.  If any sum or obligation is unascertained, X may in good faith estimate that sum or obligation and set-off in respect of that estimate, subject to X or Y, as the case may be, accounting to the other party when such sum or obligation is ascertained.

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(c) Representations and Warranties.  Section 3(a) is amended by adding the following paragraphs (vi) and (vii):

“(vi) No Agency.  It is entering into this Agreement and each Transaction as principal (and not as agent or in any other capacity, fiduciary or otherwise).

(vii) Eligible Contract Participant.  It is an “eligible contract participant” as defined in the U.S. Commodity Exchange Act.

(d) Relationship Between Parties.  Each party will be deemed to represent to the other party on the date on which it enters into a Transaction that (absent a written agreement between the parties that expressly imposes affirmative obligations to the contrary for that Transaction):

(i)           Non-Reliance.  It is acting for its own account, and it has made its own independent decisions to enter into that Transaction and as to whether that Transaction is appropriate or proper for it based upon its own judgment and upon advice from such advisers as it has deemed necessary.  It is not relying on any communication (written or oral) of the other party as investment advice or as a recommendation to enter into that Transaction; it being understood that information and explanations related to the terms and conditions of a Transaction shall not be considered investment advice or a recommendation to enter into that Transaction.  No communication (written or oral) received from the other party shall be deemed to be an assurance or guarantee as to the expected results of that Transaction.

(ii)           Assessment and Understanding.  It is capable of assessing the merits of and understanding (on its own behalf or through independent professional advice), and understands and accepts, the terms, conditions and risks of that Transaction.  It is also capable of assuming, and assumes, the risks of that Transaction.

(iii)           Status of Parties.  The other party is not acting as a fiduciary for or an adviser to it in respect of that Transaction.”

(e) Waiver of Jury Trial.  Each party irrevocably waives any and all right to a trial by jury in any suit, action or proceeding arising our of or relating to this Agreement or any Transaction and acknowledges that this waiver is a material inducement to the other party’s entering into this Agreement.

(f) Consent toRecording.  The parties agree that each may electronically record all telephonic conversations between them and that any such recordings may be submitted in evidence to any court or  in any Proceedings for the purpose of establishing any matters pertinent to any Transaction..

(g) Outstanding Specified Transactions.  Upon the effectiveness of this Agreement, unless otherwise agreed to in writing by the parties to this Agreement with respect to specific Specified Transactions, all Specified Transactions then outstanding between Offices of the parties listed in Section 4(d) shall be subject to the terms hereof.

(h) Severance.  IN the event any one or more of the provisions contained in this Agreement should be held invalid, illegal or unenforceable in any respect, such provisions shall be severed from this Agreement to the extent of such invalidity, illegality or unenforceability, unless such severance shall substantially impair the benefits of the remaining portions of this Agreement.  The Agreement after such severance shall remain the valid, binding and enforceable obligation of the parties hereto.

(i) Payment Instructions.  All payments to be made hereunder in respect of Transactions shall be made in accordance with standing payment instructions provided by the parties (or as otherwise specified in a Confirmation).

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EX-10.3

Exhibit 10.3

FIRST AMENDMENT TO

THIRD AMENDED AND RESTATED LOAN AGREEMENT

This FIRST AMENDMENT TO THIRD AMENDED AND RESTATED LOAN AGREEMENT (this “First Amendment”) is made as of this 15th day of October, 2008 by and among FRANKLIN STREET PROPERTIES CORP., a Maryland corporation (“FSP”), those certain wholly owned subsidiaries of FSP (the “Wholly Owned Subsidiaries”) listed on Schedule 1 attached hereto (as the same may be amended from time to time in accordance with the terms of the Loan Agreement (as defined below)) (FSP and the Wholly Owned Subsidiaries collectively, the “Borrower”), RBS CITIZENS, NATIONAL ASSOCIATION (“Citizens”), BANK OF AMERICA, N.A. (“BOA”), CHEVY CHASE BANK, F.S.B. (“Chevy Chase”), WACHOVIA BANK, NATIONAL ASSOCIATION (“Wachovia”), and any other lenders, if any, which may become parties to the Loan Agreement (with Citizens, BOA, Chevy Chase and Wachovia, the “Lenders”), and RBS CITIZENS, NATIONAL ASSOCIATION, in its capacity as “Agent” for the Lenders (“Agent”).

WHEREAS, Borrower, Agent and the Lenders entered into that certain Third Amended and Restated Loan Agreement dated as of October 19, 2007 (the “Loan Agreement”), relating to a certain revolving loan facility with a present maximum amount of $250,000,000 made by the Lenders to Borrower (the “Loan”); and

WHEREAS, Borrower desires to enter into a term loan facility as evidenced by that certain Term Loan Agreement dated as of the date hereof with a present maximum amount of $75,000,000 between Borrower and the lenders thereunder, as may be amended, modified, restated or revised from time to time (the “Term Loan”); and

WHEREAS; Borrower has requested that the Agent and the Lenders consent to the Term Loan; and

WHEREAS, the Agent and Lenders have agreed to consent to Borrower entering into the Term Loan, provided that (i) Borrower agrees to enter in to this First Amendment with Agent and the Lenders to, among other things, amend certain financial covenants and other terms and conditions in the Loan Agreement, subject to the terms and conditions set forth herein, (ii) FSP Austin N.W. Limited Partnership, a Massachusetts limited partnership is removed as a Borrower under the Loan, (iii) FSP East Baltimore Street LLC, a Delaware limited liability company, and FSP Park Ten Phase II Limited Partnership, a Texas limited partnership, are added as Borrowers under the Loan, and (iv) the respective agents under the Loan and under Term Loan execute and deliver the Intercreditor Agreement.

NOW, THEREFORE, for Ten Dollars ($10.00) and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the undersigned parties hereby agree as follows:

1.           Capitalized terms used but not defined herein shall have the meanings ascribed to such terms in the Loan Agreement.

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2.           Section 2.4(b) of the is hereby deleted in its entirety and replaced with the following:

“In the event that the Borrower shall receive Advance(s) in excess of the Loan Amount the Borrower shall immediately repay the Loan by an amount sufficient to reduce the outstanding principal balance to equal or less than the Loan Amount.”

3.           Section 2.5.7 of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“All interest shall be:  (a) Payable in arrears commencing November 1, 2007 and on last day of each Libor Interest Period thereafter until the principal together with all interest and other charges payable with respect to the Loan shall be fully paid; and (b) calculated on the basis of a 360 day year and the actual number of days elapsed.  Each change in the Prime Rate shall simultaneously change the Variable Rate payable under this Agreement.  Interest at the Adjusted Libor Rate shall be computed from and including the first day of the applicable Interest Period to, but excluding, the last day thereof.”

4.           Section 2.5.9 of the Loan Agreement is hereby amended by deleted in its entirety and replaced with the following:

“The Loan or any portion thereof may be prepaid in full or in part at any time upon three (3) Business Days’ prior written notice to Agent without premium or penalty with respect to Variable Rate Advances and, with respect to Libor Advances subject to a Make-Whole Provision and upon payment of a LIBOR Rate Loan Prepayment Fee, if applicable.  Any partial prepayment of principal shall be applied in accordance with the terms hereof.”

5.           Sections 2.11 and 10.2(c) of the Loan Agreement are hereby deleted in their entirety.  No advances under the Overline Facility were made and the Overline Facility is no longer available.

6.           Section 5 of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“At the time of an Acquisition by a Wholly Owned Subsidiary, such Wholly Owned Subsidiary which has become an owner of a Property in connection with such Acquisition shall execute the Joinder Documents so as to become a Borrower under this Agreement and shall be added as a maker under the Note.  Upon the execution of such Joinder Documents, such entities shall be considered a “Borrower” and subject to all of the terms and conditions hereof, and shall continue to be a “Borrower” hereunder except as provided in clause (b) of Section 1.2 hereof.”

7.           Section 8.1(a) of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

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“(a) Organization; Good Standing.  Each of the entities comprising the Borrower is a limited partnership, limited liability company, or corporation, as the case may be, duly organized under the laws of its state of organization pursuant to each Person’s respective Organizational Documents, and is, and will at all times be, validly existing and in good standing under the laws of such State.  The Borrower is, and will at all times be, duly organized and is, and will at all times be, validly existing, in good standing, and qualified to do business in each jurisdiction where required except where failure to so qualify would not have a material adverse affect on the Unencumbered Pool Properties.  Each of the entities comprising the Borrower has, and will at all times have, all requisite power to own its property and conduct its business as now conducted and as presently contemplated.”

8.           Section 8.5 of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“The Borrower possesses, and will at all times possess, all franchises, patents, copyrights, trademarks, trade names, licenses and permits, and rights in respect of the foregoing, adequate for the conduct of its business substantially as now conducted or as it is intended to be conducted with respect to the Unencumbered Pool Properties, without known conflict with any rights of others, except where the failure to do so would not reasonably be expected to have a material adverse effect on the Borrower taken as a whole.”

9.           Section 8.6 of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“There are no actions, suits, proceedings or investigations of any kind pending or, to Borrower’s knowledge, threatened against the Borrower before any court, tribunal or administrative agency or board or any mediator or arbitrator that, either in any case or in the aggregate, would reasonably be expected to materially and adversely affect the business, assets or financial condition of the Borrower taken as a whole, or result in any material liability not adequately covered by insurance, and for which adequate reserves are not maintained on the balance sheet of such Person, or which question the validity of this Agreement or any of the other Loan Documents, any action taken or to be taken pursuant hereto or thereto, or which will materially and adversely affect the ability of the Borrower to use and occupy any of the properties comprising the Unencumbered Pool Properties or to pay and perform the Obligations in the manner contemplated by this Agreement and the other Loan Documents.”

10.           Section 8.17 (including all therein) of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“The Borrower makes the following representations and warranties, to the best of its knowledge, with respect to each individual property included in the Unencumbered Pool Properties, as of the date hereof and except as disclosed in the Borrower’s filings with the Securities and Exchange Commission:

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(a) Availability of Utilities.  (i) all utility services necessary and sufficient for the use and operation of each property comprising the Unencumbered Pool Properties are presently available to the boundaries of each of the properties comprising the Unencumbered Pool Properties through dedicated public rights of way or through perpetual private easements; and (ii) the owner has obtained all material utility installations and connections required for the operation and servicing of each of the properties comprising the Unencumbered Pool Properties for its intended purposes.

(b) Access.  (i) the rights of way for all roads necessary for the utilization in all material respects of each of the properties comprising the Unencumbered Pool Properties for its intended purposes have either been acquired by the appropriate Governmental Authority or have been dedicated to public use and accepted by such Governmental Authority; (ii) all such roads have been completed and the right to use all such roads, or suitable substitute rights of way, have been obtained; and (iii) all curb cuts, driveways and traffic signals required for the operation and use in all material respects of each of the properties comprising the Unencumbered Pool Properties are existing.

(c) Condition of Unencumbered Pool Properties.  Neither the Unencumbered Pool Properties nor any material part thereof is now damaged or injured as result of any material fire, explosion, accident, flood or other casualty, no Taking is pending or contemplated.

(d) Compliance with Requirements/Historic Status/Flood Area.  The Unencumbered Pool Properties comply with all material Requirements.  Except as disclosed in the Environmental Report, Borrower has received no written notice alleging any material non-compliance by any of the properties comprising the Unencumbered Pool Properties with any Requirements or indicating that any of the properties comprising the Unencumbered Pool Properties is located within any historic district or has, or may be, designated as any kind of historic or landmark site under applicable Requirements.  None of the properties comprising the Unencumbered Pool Properties, except for the Unencumbered Pool Property known as Blue Lagoon is located in any special flood hazard area as defined under applicable Requirements, unless such property is adequately covered by insurance.

(e) Other Contracts.

(i) The Borrower has not made any material contract or arrangement of any kind or type whatsoever (whether oral or written, formal or informal), the performance of which by the other party thereto would reasonably be expected to give rise to a lien or encumbrance on any of the properties comprising the Unencumbered Pool Properties other than a Permitted Lien.

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(ii) The Borrower has not made any material contract or arrangement of any kind or type whatsoever, with any affiliate of the Borrower, except for management agreements with FSP Property Management LLC, agreements for services of its employees, officers, trustees, managers and directors and agreements with a Syndication REIT (including without limitation agreements relating to Affiliate Dispositions) and except as otherwise permitted in this Agreement which shall be deemed approved by Lenders, unless such contract or arrangement is in writing and is (i) approved in writing in advance by the Agent, or is (ii) on the same terms as would be generally available to the Borrower in an arm’s length contract or arrangement with a third party.

(f) Violations.  Except as disclosed in the Environmental Reports, the Borrower has received no written notices of any violation of any applicable material Requirements with respect to any of the properties comprising the Unencumbered Pool Properties.

(g) Environmental Matters.  The Borrower has caused an investigation to be made of the past and present condition and usage of each individual property included in the Unencumbered Pool Properties and the operations conducted thereon and, based upon such investigation, except as disclosed in the Environmental Reports and/or in the Borrower’s filings with the Securities and Exchange Commission, makes the following representations and warranties as of the date hereof and to the best of Borrower’s knowledge:

(i) With respect to the Unencumbered Pool Properties, the Borrower has not received written notice from any third Person including, without limitation, any federal, state or local governmental authority, asserting that any of the operations thereon are in violation of any Environmental Law or any judgment, decree or order related thereto which violation would reasonably be expected to have a material adverse effect on the business, assets or financial condition of the Borrower.

(ii) The Borrower has not received written notice from any third Person including, without limitation, any federal, state or local governmental authority, asserting (i) that it has been identified by the United States Environmental Protection Agency (“EPA”) as a potentially responsible Person with respect to a site listed on the National Priorities List, 40 C.F.R. Part 300 Appendix B (1986); (ii) that any Hazardous Substances which it has generated, transported or disposed of have been found at any site at which a federal, state or local agency or other third Person has conducted or has ordered that the Borrower conduct a remedial investigation, removal or other response action pursuant to any Environmental Law; or (iii) that it is or shall be a named party to any claim, action, cause of action, complaint, or legal or administrative proceeding (in each case, contingent or otherwise) arising out of any third Person’s incurrence of costs, expenses, losses or damages of any kind whatsoever in connection with the release of Hazardous Substances; which would reasonably be expected to have a material adverse effect on the business, assets or financial condition of the Borrower or result in cleanup expenses of Ten Million Dollars ($10,000,000.00) or more in the aggregate.

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(iii) With respect to the Unencumbered Pool Properties: (i) no portion of the Unencumbered Pool Properties has been used for the handling, processing, storage or disposal of Hazardous Substances except in connection with the use of the Unencumbered Pool Properties and any such use, handling, storage or disposal has been materially in accordance with applicable Environmental Laws; and no underground tank or other underground storage receptacle for Hazardous Substances is located on any portion of the Unencumbered Pool Properties except in material compliance with Environmental Laws; (ii) in the course of any activities conducted by the Borrower or the operators of its properties, no Hazardous Substances have been generated or are being used on the Unencumbered Pool Properties except materially in accordance with applicable Environmental Laws; (iii) there has been no release, i.e. any past or present releasing, spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, disposing or dumping (a “Release”) or threatened Release of Hazardous Substances on, upon, into or from the Unencumbered Pool Properties, which Release would have a material adverse effect on the value of the Unencumbered Pool Properties; (iv) there have been no Releases on, upon, from or into any real property in the vicinity of any of the Unencumbered Pool Properties which, through soil or groundwater contamination, has come to be located on, and which has a material adverse effect on the value of the Unencumbered Pool Properties; and (v) any Hazardous Substances that have been generated by Borrower on any of the Unencumbered Pool Properties have been managed and/or disposed of materially in compliance with such permits and applicable Environmental Laws.

(iv) Except with respect to the Unencumbered Pool Properties known as Blue Lagoon and Collins Crossing, neither the Borrower nor any property comprising the Unencumbered Pool Properties is subject to any applicable Environmental Law requiring the performance of Hazardous Substances site assessments, or the removal or remediation of Hazardous Substances, or the giving of notice to any governmental agency or the recording or delivery to other Persons of an environmental disclosure document or statement by virtue of the transactions set forth herein and contemplated hereby, in any case which would reasonably be expected to have a material adverse effect on the business, assets or financial condition of the Borrower or result in cleanup expenses of Ten Million Dollars ($10,000,000.00) or more in the aggregate.

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(v) The Borrower shall indemnify, defend, and hold the Agent and the Lenders harmless of and from any claim brought or threatened against the Agent and the Lenders by the Borrower, any guarantor or endorser of the Obligations, or any governmental agency or authority or any other person (as well as from attorneys’ reasonable fees and expenses in connection therewith) on account of the presence of hazardous material or oil on any of the Unencumbered Pool Properties, the release of hazardous materials or oil on or from any of the Unencumbered Pool Properties, or the failure by the Borrower to comply with the terms and provisions hereof (each of which may be defended, compromised, settled, or pursued by the Agent with counsel of the Agent’s selection, but at the expense of the Borrower).  This indemnification covers any costs and expenses that the Agent and/or the Lenders may incur and any damages or other liabilities including reasonable attorneys’ fees for assessment, containment and/or removal of any hazardous material or oil from all or any portion of the Unencumbered Pool Properties or any surrounding areas.  The within indemnification shall survive payment of the Obligations and/or any termination, release, or discharge executed by the Agent in favor of the Borrower; provided, however, that such indemnification shall not apply to any claim brought or threatened against the Agent and/or the Lenders and arising from the Agent’s and/or the Lenders’ gross negligence or willful misconduct.”

11.           Section 8.20 of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“The representations, warranties, covenants and agreements contained herein with respect to the Unencumbered Pool Properties, or any of the properties comprising the Unencumbered Pool Properties, shall be made as of the date hereof and no representations, warranties, covenants and agreements are made with respect to the Unencumbered Pool Properties subsequent to the date hereof.”

12.           Section 9.2(c) of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“(c) contemporaneously with the delivery of the financial statements referred to in clause (a) above, a statement of all contingent liabilities of the Borrower which are not reflected in such financial statements or referred to in the notes thereto, certified by the principal financial or accounting office of FSP as fairly presenting the financial condition of the Borrower as at the close of business on the date(s) thereof, and upon request of the Agent, annual budget and cash flow forecasts for the Borrower and Unencumbered Pool Properties all in reasonable detail;”

13.           Section 9.3(a) of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

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“(a) Upon request, the Borrower will provide evidence of insurance with respect to each of the properties comprising the Unencumbered Pool Properties.”

14.           Section 9.4 of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“The Borrower will duly pay and discharge, or cause to be paid and discharged, before the same shall become overdue all claims for labor, materials, or supplies that if unpaid would reasonably be expected by law to become a lien or charge upon any of its Other Properties, except as to Permitted Liens, or any of the Unencumbered Pool Properties, except as to the Permitted Liens otherwise permitted in the definition of Unencumbered Pool Properties.”

15.           Section 9.5(a) of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“(a) The Borrower shall permit the Agent and the Lenders at the Borrower’s expense, to visit and inspect any of the properties comprising the Unencumbered Pool Properties and will cooperate with the Agent and the Lenders during such inspections provided that this provision shall not be deemed to impose on the Agent and the Lenders any obligation to undertake such inspections; provided that so long as no Default or Event of Default shall have occurred and be continuing, the Borrower shall only be obligated to pay the reasonable expenses associated with one (1) such investigation of the books of account of the Borrower during any twelve (12) month period commencing with the first anniversary of this Agreement.  Any such inspections are to be conducted during normal business hours and prior to the occurrence and continuation of an Event of Default, Lenders shall provide Borrower with forty-eight (48) hours advance notice.”

16.           Section 9.6 of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“The Borrower will comply in all material respects with (a) the applicable laws and regulations wherever its business is conducted, including all Environmental Laws and, in the case of the Borrower, all Requirements, (b) the provisions of its Organizational Documents and all Loan Documents to which Borrower or Subsidiary are signatories, (c) all agreements and instruments by which it or any of its properties may be bound, including, all restrictions, covenants and easements affecting the Unencumbered Pool Properties, (d) all applicable decrees, orders and judgments, and (e) all licenses and permits required by applicable laws and regulations for the conduct of its business or the ownership, use or operation of its properties.”

17.           Section 9.10 of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“The Borrower will promptly notify the Agent in writing of (i) the occurrence of any Event of Default; (ii) the occurrence of any other event which is likely to have a materially adverse effect on any of the properties comprising the Unencumbered Pool Properties or the business or financial condition of the Borrower; or (iii) the receipt by the Borrower of any notice of default or notice of termination with respect to any contract or agreement relating to the ownership, operation, or use of any of the properties comprising the Unencumbered Pool Properties which is likely to have a materially adverse effect on the Borrower.”

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18.           Section 9.13 of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“The Borrower shall provide Agent with written notice of the establishment of a Wholly Owned Subsidiary.  At the time of an Acquisition by a Wholly Owned Subsidiary, such Wholly Owned Subsidiary which has become an owner of a Property in connection with such Acquisition shall execute the Joinder Documents so as to become a Borrower under this Agreement.”

19.           Section 9.15 of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“Borrower shall provide Agent with written notice of all dispositions or Acquisitions of individual properties by FSP or a Wholly Owned Subsidiary within seven (7) days prior to the disposition or Acquisition.  With respect to any Acquisitions, the notice shall include the location of the property, the purchase price and the projected closing date.  With respect to any disposition (other than an Affiliate Disposition) of individual properties by a Wholly Owned Subsidiary, the notice shall include a certification from the chief financial officer of FSP stating that such disposition shall not cause a violation of any covenant contained herein, including, without limitation, any breach of §10.8, both before and after such disposition, and that no Default or Event of Default exists hereunder.  With respect to Syndication REITS, Borrower will provide Agent with a copy of the applicable confidential offering memorandum on or before the first Syndication Event for such offering.  All real property acquired in an Acquisition by FSP or a Wholly Owned Subsidiary (including a 1031 Property) shall become part of the Property and shall be subject to the terms hereof, and the definition of Property shall be deemed amended to include all such real property (including 1031 Property) and to exclude any property disposed of by the Borrower pursuant to the terms hereof.”

20.           Section 10.2(e) of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“(e) Indebtedness secured by liens on Other Properties, and the liens on Unencumbered Pool Properties (limited to Permitted Liens permitted in the definition of Unencumbered Pool Properties) subject to the limitations in Section 10.8(g);”

21.           Section 10.2(f) of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“(f)       Reserved.”

22.           Section 10.2(i) of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“(i) Indebtedness not to exceed the principal amount of $1,000,000 at any time outstanding, including without limitation guarantees and capital leases; and”

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23.           The following new Section 10.2(j) is hereby added to the Loan Agreement:

“(j) Indebtedness arising from use of the Term Loan.”

24.           Section 10.3 of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“With the exception of Permitted Liens, the Borrower will not (a) create or incur or suffer to be created or incurred or to exist any lien, encumbrance, mortgage, pledge, charge or other security interest of any kind upon any of the Borrower’s Properties, or upon the income or profits therefrom; (b) transfer any of the Borrower’s Properties or the income or profits therefrom for the purpose of subjecting the same to the payment of Indebtedness or performance of any other obligation in priority to payment of its general creditors, except as provided in Section 10.2(e); (c) acquire, or agree or have an option to acquire, any property or assets upon conditional sale or other title retention or purchase money security agreement, device or arrangement; (d) suffer to exist for a period of more than thirty (30) days after the same shall have been incurred any Indebtedness or claim or demand against it that if unpaid would likely by law or upon bankruptcy or insolvency, or otherwise, be given any priority whatsoever over its general creditors; or (e) sell, assign, pledge or otherwise transfer any accounts, contract rights, general intangibles, chattel paper or instruments, with or without recourse; provided that the Borrower may create or incur or suffer to be created or incurred or to exist liens in favor of the Lenders under the Loan Documents and in favor of the agent and lenders under the Term Loan.  Notwithstanding the foregoing, the Borrower may sell any of its Property, whether now owned or hereafter acquired, provided that prior to and after any such sale (i) the Borrower is in compliance with all of its covenants herein, including, without limitation, the financial covenants contained in §10.8, and (ii) No Default or Event of Default has occurred and is continuing hereunder.”

25.           Section 10.4(g) of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“(g)      mutual funds managed by Agent and Co-Agent or their respective affiliates;”

26.           Section 10.8(a) of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“(a) Loan to Value.  The ratio (“Loan to Value Ratio”) obtained by dividing the aggregate, without duplication, of (i) the outstanding principal balance of the Loan, (ii) the outstanding principal balance of the Term Loan, and (iii) other unsecured indebtedness  for borrowed money, by the Value of the Unencumbered Pool Properties, expressed as a percentage, shall not be greater than sixty percent (60%).  This covenant shall be tested at the end of each fiscal quarter of the Borrower.  In testing compliance with this covenant the Value of the Unencumbered Pool Properties attributed to any one property may not exceed 20% of the aggregate Value of the Unencumbered Pool Properties for all properties.”

27.           Section 10.8(b) of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

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“(b) Ratio of Net Operating Income to Debt Service Charges.  The Borrower will not permit the ratio of Net Operating Income of Borrower to Debt Service Charges to be less than 2.0 to 1.0.  This covenant shall be tested at the end of each fiscal quarter of the Borrower.”

28.           Section 10.8(c) of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“(c) Consolidated Indebtedness.  The Borrower will not permit Consolidated Indebtedness to exceed 50% of the aggregate of (i) the Value of the Properties plus (ii) the book value of all tangible assets of the Borrower (other than real estate and after eliminating any duplication which will include (a) cash and cash equivalents, (b) stock held in Syndication REITS, and (c) mortgage receivables from Syndication REITS).  This covenant shall be tested at the end of each fiscal quarter of the Borrower.”

29.           Section 10.8(e) of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“(e) Account Balances.  The Borrower, any Wholly Owned Subsidiaries and affiliated companies, shall, at all times, maintain with the Agent or its affiliate minimum checking account and savings account (exclusive of trust accounts) collected balances of $1,500,000.00 (less any amount maintained in checking accounts and savings accounts (exclusive of trust accounts) with the agent under the Term Loan).  This covenant shall be tested at the end of each fiscal quarter of the Borrower.”

30.           Section 10.8(g) of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“(g) Maximum Secured Debt.  The Borrower will not permit secured Indebtedness of the Borrower to exceed 25% of the Value of the Properties.”

31.           The following new Section 10.8(h) is hereby added to the Loan Agreement:

“(h) Unencumbered Pool Coverage Ratio.  The Borrower will not permit the ratio of Net Operating Income attributable to the ownership and operation of the Unencumbered Pool Properties to Debt Service Charges on Unencumbered Pool Properties to be less than 2.0 to 1.0.  This covenant shall be tested at the end of each fiscal quarter of the Borrower.”

32.           Section 10.9(a) of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“(a) Seek the dissolution or winding up, in whole or in part, of the Borrower (other than after the property of such Borrower has been disposed of in accordance with the provisions of this Agreement) or voluntarily file, or consent to the filing of, a petition for bankruptcy, reorganization, assignment for the benefit of creditors or similar proceedings; and”

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33.           Section 11.1(c) of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“(c) with the exception of a Permitted Lien, title to the Unencumbered Pool Properties is or becomes reasonably unsatisfactory to the Lenders by reason of any lien, charge, encumbrance, title condition or exception and such matter causing title to be or become unsatisfactory is not cured to Lenders’ reasonable satisfaction or removed within twenty (20) days after notice thereof from the Agent to the Borrower; or”

34.           Section 11.1(d) of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“(d) the Unencumbered Pool Properties or any material part thereof is subject to a Taking; or”

35.           Section 11.1(h) of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“(h) any suit or proceeding shall be filed against the Borrower or any of the properties comprising the Unencumbered Pool Properties which is reasonably likely to result in a judgment which would have a materially adverse affect on the ability of the Borrower to perform their respective material obligations under and by virtue of the Loan Documents; or”

36.           Section 11.1(o) of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“(o) any of the Loan Documents shall be canceled, terminated, revoked or rescinded by Borrower otherwise than in accordance with the terms thereof or with the express prior approval of the Lenders, or any action at law, suit in equity or other legal proceeding to cancel, revoke or rescind any of the Loan Documents shall be commenced by or on behalf of the Borrower which is a party thereto or any of their respective stockholders, partners or beneficiaries, or any court or any other governmental or regulatory authority or agency of competent jurisdiction shall make a determination that, or issue a judgment, order, decree or ruling to the effect that, any one or more of the Loan Documents is illegal, invalid or unenforceable against the Borrower in accordance with the terms thereof; or”

37.           Section 11.1(r) of the Loan Agreement is hereby amended by deleting it in its entirety and replacing it with the following:

“(r) any failure by the Borrower to duly perform all of its obligations under any Hedging Contract that hedges the Borrower’s interest rates under this Loan Agreement, which such failure results in the designation by the Agent of an “Early Termination Date” with respect to the Borrower pursuant to (and as defined under) Section 6(a) of the applicable Hedging Contract.”

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38.           The current Section 11.1(s) of the Loan Agreement is hereby changed to “Section 11.1(t)” and the following new Section 11.1(s) is hereby added to the Loan Agreement:

“(s)           any Event of Default under the Term Loan; or”

39.           Section 11.3 of the Loan Agreement is hereby amended by deleting it in its entirety and replacing it with the following

“If any one or more of the Events of Default shall have occurred and continued beyond any applicable grace periods, and whether or not the Lenders shall have terminated its obligations to make Advances or accelerated the maturity of the Loan pursuant to §11.2, the Agent and the Lenders may proceed to protect and enforce its rights and remedies under this Agreement, the Note or any of the other Loan Documents, including, by foreclosure, exercise of set-off or pledge rights and/or by suit in equity, action at law or other appropriate proceeding, whether for the specific performance of any covenant or agreement contained in this Agreement and the other Loan Documents or any instrument pursuant to which the Obligations are evidenced, including as permitted by applicable law the obtaining of the ex parte appointment of a receiver, and, if any amount owed to the Agent or the Lenders shall have become due, by declaration or otherwise, proceed to enforce the payment thereof or any other legal or equitable right of the Agent or the Lenders.  No remedy conferred upon the Agent or the Lenders or the holder of the Note in this Agreement or in any of the other Loan Documents is intended to be exclusive of any other remedy and each and every remedy shall be cumulative and shall be in addition to every other remedy given hereunder or thereunder or now or hereafter existing at law or in equity or by statute or any other provision of law.

Notwithstanding any provisions of this Agreement to the contrary, all terms and conditions of this Agreement, and all rights and remedies of the Lenders hereunder are subject to and limited by the terms and conditions of the Intercreditor Agreement as the terms of the Intercreditor Agreement may be applicable to same.”

40.           Section 11.4 of the Loan Agreement is hereby deleted in its entirety and is replaced with the following:

“11.4                      Distribution of  Proceeds.  Subject to the terms and conditions hereof, the Agent shall distribute all Liquidation Proceeds allocated to the Loan as provided above on a pro-rata basis in the order and manner set forth below:

First: To the Agent, towards any fees and any expenses for which the Agent is entitled to reimbursement under this Agreement or the other Loan Documents not theretofore paid to the Agent.

Second: To all Lenders in accordance with their proportional share based upon their respective Commitment Percentages until all Lenders have been reimbursed for all expenses which such Lenders have previously paid to the Agent and not theretofore paid to such Lenders.

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Third: To the ratable payment, on a pari passu basis, of (a) all principal and interest due to Lenders under the Loan, with each Lender applying the proceeds for purposes of this Agreement first against the outstanding principal balance due to such Lender under the Loan and then to accrued and unpaid interest due under the Loans, and (b) any outstanding obligations under any Hedging Contract (including outstanding obligations to any hedge provider which was a Lender or Affiliate of a Lender at the time such derivative transaction was entered into).

Fourth: To all applicable Lenders in accordance with their proportional share based upon their respective Commitment Percentages until all Lenders have been paid in full all other amounts due to such Lenders under the Loan including, without limitation, any costs and expenses incurred directly by such Lenders to the extent such costs and expenses are reimbursable to such Lenders by the Borrowers under the Loan Documents.

Fifth: To the Borrowers or such third parties as may be entitled to claim Liquidation Proceeds.”

41.           Section 13 of the Loan Agreement is hereby deleted in its entirety and is replaced with the following:

“The Borrower agrees to pay (a) the reasonable costs of producing and reproducing this Agreement, the other Loan Documents and the other agreements and instruments mentioned herein, (b) any taxes (including any interest and penalties in respect thereto) payable by the Lenders (other than franchise taxes and taxes based upon the Lenders’ net income or receipts), including any taxes payable on or with respect to the transactions contemplated by this Agreement, including any taxes payable by the Lenders after the Closing Date (the Borrower hereby agreeing to indemnify the Lenders with respect thereto), (c) the reasonable fees, expenses and disbursements of the Agent’s counsel or any local counsel to the Agent incurred in connection with the preparation or interpretation of the Loan and the Loan Documents and other instruments mentioned herein, the making of each Advance hereunder, and amendments, modifications, approvals, consents or waivers hereto or hereunder, (d) the reasonable fees, expenses and disbursements of the Agent incurred in connection with the preparation or interpretation of the Loan and the Loan Documents and other instruments mentioned herein, and the making of each Advance hereunder (including all reasonable appraisal fees, and surveyor fees subject to the terms of §9.5 hereof), (e) all reasonable out-of-pocket expenses (including reasonable attorneys’ fees and costs) and the reasonable fees and costs of consultants, accountants, auctioneers, receivers, brokers, property managers, appraisers, investment bankers or other experts retained by the Agent or the Lenders in connection with (i) the enforcement of or preservation of rights under any of the Loan Documents against the Borrower or the administration thereof after the occurrence and during the continuation of a Default or Event of Default and (ii) any litigation, proceeding or dispute arising hereunder, (f) all reasonable fees, expenses and disbursements of the Agent and the Lenders incurred in connection with UCC searches, UCC filings, title rundowns, title searches or mortgage recordings in accordance with the terms hereof; and (g) all reasonable costs associated with annual inspections, or at any time after the occurrence and continuation of an Event of Default, all reasonable expenses incurred by Agent for site visits for real property located outside of the Commonwealth of Massachusetts which expenses shall not exceed $10,000.00 per year.  The covenants of this Section shall survive payment or satisfaction of payment of all amounts owing with respect to the Notes.”

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42.           Section 14 of the Loan Agreement is hereby deleted in its entirety and is replaced with the following:

“The Borrower agrees to indemnify and hold harmless the Agent and the Lenders from and against any and all claims, actions and suits, whether groundless or otherwise, and from and against any and all liabilities, losses, damages and expenses of every nature and character arising out of this Agreement or any of the other Loan Documents or the transactions contemplated hereby and thereby including, without limitation, (a) any brokerage, leasing, finders or similar fees, (b) any disbursement of the proceeds of any of the Advances, (c) any condition of the properties comprising the Unencumbered Pool Properties whether related to the quality of construction or otherwise, (d) any actual or proposed use by the Borrower of the proceeds of any of the Advances, (e) any actual or alleged violation of any Requirements or Project Approvals, (f) any action taken by Lender to enforce its rights and remedies under the Loan Documents, including the rights and remedies set forth in §11 hereof, or (g) the Borrower entering into or performing this Agreement or any of the other Loan Documents, in each case including, without limitation, the reasonable fees and disbursements of counsel incurred in connection with any such investigation, litigation or other proceeding, and in each case except to the extent such claims, actions, suits, liabilities, losses, damages or costs arise due to Agent’s or a Lender’s gross negligence or intentional misconduct.  In litigation, or the preparation therefor, the Lenders shall be entitled to select its own counsel and, in addition to the foregoing indemnity, the Borrower agrees to pay within thirty (30) days the reasonable fees and expenses of such counsel.  The obligations of the Borrower under this Section shall survive the repayment of the Loan and shall continue in full force and effect so long as the possibility of such claim, action or suit exists.  If, and to the extent that the obligations of the Borrower under this Section are unenforceable for any reason, the Borrower hereby agrees to make the maximum contribution to the payment in satisfaction of such obligations which is permissible under applicable law.”

43.           Section 17 of the Loan Agreement is hereby deleted in its entirety and is replaced with the following:

“All covenants, agreements, representations and warranties made herein, in the Notes, in any of the other Loan Documents or in any documents or other papers delivered by or on behalf of the Borrower pursuant hereto and thereto shall be deemed to have been relied upon by the Lenders, notwithstanding any investigation heretofore or hereafter made by it, and shall survive the making by the Lenders of the Advances, as herein contemplated, and shall continue in full force and effect either (i) so long as any amount due under this Agreement or the Note or any of the other Loan Documents remains outstanding or the Lenders have any obligation to make any Advances or (ii) for such longer period as may be expressly provided for herein or in any other Loan Document.  All statements contained in any certificate or other paper delivered to the Agent or the Lenders at any time by or on behalf of any Person or any Subsidiary thereof pursuant hereto shall constitute representations and warranties by such Person.”

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44.           Section 18.12.6 of the Loan Agreement is hereby deleted in its entirety and is replaced with the following:

“If any Lender (including the Agent), acting in its individual capacity, shall exercise any right of setoff against a deposit balance or other account of the Borrower held by such Lender on account of the Obligations of the Borrower under this Agreement, such lender shall remit to the Agent all such sums received pursuant to the exercise of such right of setoff, and the Agent shall apply all such sums for the benefit of all of the Lenders hereunder in accordance with the terms of this Agreement.”

45.           Section 18.16 of the Loan Agreement is hereby deleted in its entirety and is replaced with the following:

“The Borrower agrees that in addition to disclosures made in accordance with standard and customary banking practices any Lender may disclose information obtained by such Lender pursuant to this Agreement to assignees or participants and potential assignees or participants hereunder; provided that such assignees or participants or potential assignees or participants shall agree (a) to treat in confidence such information unless such information otherwise becomes public knowledge, (b) not to disclose such information to a third party except as required by law or legal process and (c) not to make use of such information for purposes of transactions unrelated to such contemplated assignment or participation.  The Agent and the Lenders agree to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to it and its affiliates’ directors, officers, employees and agents, including accountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential), (b) to the extent requested by any regulatory authority, (c) to the extent required by applicable laws or regulations or by any subpoena or similar legal process, (d) to any other party hereto, (e) in connection with the exercise of any remedies hereunder or under any other Loan Document or any action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder, (f) subject to an agreement containing provisions substantially the same as those of this Section, to (i) any assignee of or participant in, or any prospective assignee of or participant in, any of its rights or obligations under this Agreement or (ii) any actual or prospective counterparty (or its advisors) to any Hedging Contract relating to the Borrower and its obligations, (g) with the written consent of the Borrower or (h) to the extent such Information (x) becomes publicly available other than as a result of a breach of this Section or (y) becomes available to the Agent or the Lenders on a nonconfidential basis from a source other than the Borrower.  For purposes of this Section, “Information” means all information received from the Borrower relating to the Borrower or any of its businesses, other than any such information that is available to the Agent or the Lenders on a nonconfidential basis prior to disclosure by the Borrower, provided that, in the case of information received from the Borrower after the date hereof, such information either (x) consists of financial statements or (y) is clearly identified at the time of delivery as confidential.  Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.

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AGENT AND EACH LENDER ACKNOWLEDGES THAT INFORMATION FURNISHED TO IT PURSUANT TO THIS AGREEMENT MAY INCLUDE MATERIAL NON-PUBLIC INFORMATION CONCERNING THE BORROWER OR ITS RESPECTIVE SECURITIES, AND CONFIRMS THAT IT HAS DEVELOPED COMPLIANCE PROCEDURES REGARDING THE USE OF MATERIAL NON-PUBLIC INFORMATION AND THAT IT WILL HANDLE SUCH MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH THOSE PROCEDURES AND APPLICABLE LAW, INCLUDING FEDERAL AND STATE SECURITIES LAWS.”

46.           The current second paragraph in Section 18.18 of the Loan Agreement is hereby deleted in its entirety and is replaced with the following:

“No term or provision of this Agreement or any other Loan Document may be changed, waived, discharged or terminated, nor may any consent required or permitted by this Agreement or any other Loan Document be given, unless such change, waiver, discharge, termination or consent receives the written approval of the Required Lenders, unless the Agent is specifically allowed to give such consent, amendment or waiver pursuant to the terms hereof.  The Borrower shall be required to give its written consent to any amendment of this Agreement and the Loan Documents.

Notwithstanding the foregoing, written approval from a Supermajority of Lenders (other than a Delinquent Lender) shall be required with respect to any proposed amendment, waiver, discharge, termination, or consent which:

(i)           results in Borrower creating, incurring, assuming or guarantying any new Indebtedness other than as permitted under Section 10.2 of this Agreement; or

(ii)           amends, modifies or waives any of the financial covenants set forth in Section 10.8 of this Agreement.

Additionally, notwithstanding the foregoing, the unanimous written approval of all the Lenders (other than a Delinquent Lender) shall be required with respect to any proposed amendment, waiver, discharge, termination, or consent which:

(i)           has the effect of (a) extending the final scheduled maturity or the date of any amortization payment of any Loan or Note, (b) reducing the rate or extending the time of payment of interest or fees thereon, (c) increasing or reducing the principal amount thereof, or (d) otherwise postponing or forgiving any indebtedness thereunder,

(ii)           amends, modifies or waives any provisions of this paragraph.

(iii)           changes the percentage specified in the definition of Required Lenders or Supermajority of Lenders,

(iv)           except as otherwise provided in this Agreement, change the amount of any Lender’s Commitment or Commitment Percentage, or

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(v)           releases or waives any of the indemnifications provided in the Loan Documents;

and provided, further, that without the consent of the Agent, no such action shall amend, modify or waive any provision of this Article 18.18 or any other provisions of any Loan Document which relates to the rights or obligations of the Agent.”

47.           Section 21 of the Loan Agreement is hereby amended by deleting the existing notice information for Wachovia Bank, National Association and replacing it with the following:

“Wachovia Bank, NA

Real Estate Asset Management

190 River Road (NJ3411)

Summit, NJ  07901

Attention: Mr. Louis Ricchione, Vice President

Fax: 908-598-3617”

48.           The Loan Agreement is hereby amended by adding the following new Section 31 thereto:

“CUSTOMER IDENTIFICATION - USA PATRIOT ACT NOTICE; OFAC AND BANK SECRECY ACT.  The Agent hereby notifies the Borrower that pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56, signed into law October 26, 2001) (the "Act"), and the Agent's policies and practices, the Agent is required to obtain, verify and record certain information and documentation that identifies the Borrower, which information includes the name and address of the Borrower and such other information that will allow the Agent to identify the Borrower in accordance with the Act.  In addition, the Borrower shall (a) ensure that no person who owns a controlling interest in or otherwise controls the Borrower or any subsidiary of the Borrower is or shall be listed on the Specially Designated Nationals and Blocked Person List or other similar lists maintained by the Office of Foreign Assets Control ("OFAC"), the Department of the Treasury or included in any Executive Orders as a blocked person, (b) not use or permit the use of the proceeds of the Loan to violate any of the foreign asset control regulations of OFAC or any enabling statute or Executive Order relating thereto, and (c) comply, and cause any of its subsidiaries to comply, with all applicable Bank Secrecy Act ("BSA") laws and regulations, as amended.”

49.           The definition of “Agent” in Schedule 1 of the Loan Agreement is hereby deleted in its entirety and is replaced with the following:

“Agent.  Citizens acting as agent for the Lenders.”

50.           The definition of “Baltimore Property” in Schedule 1 of the Loan Agreement is hereby deleted in its entirety and is replaced with the following:

“Baltimore Property.  The office property located at 120 East Baltimore Street, Baltimore, Maryland.”

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51.           The definition of “Consolidated Total Asset Value” in Schedule 1 of the Loan Agreement is hereby deleted in its entirety and is replaced with the following:

“Consolidated Total Asset Value.  The value of all properties owned by the Borrower or subsidiaries by utilizing a 8.25% capitalization rate (7% for CBD Properties) based on the most recent quarter’s Net Operating Income from all properties owned by the Borrower times 4, plus the book value of all other tangible assets (including stock and mortgage Syndication REITS).  In addition, in determining Consolidated Total Asset Value for the first 12 months after an acquisition, the Borrower may include such newly acquired property at either the cost basis value or the capitalization rate value.  Further, in valuing development properties, and at Borrower’s election, either a cost basis value or a capitalization rate (annualized as appropriate) value will be applied to such properties based on the most recent quarter’s Net Operating Income times 4.”

52.           The definition of “Debt Service Charges” in Schedule 1 of the Loan Agreement is hereby deleted in its entirety and is replaced with the following:

“Debt Service Charges.  For any fiscal period of the Borrower, without duplication, the sum of the expenses of the Borrower for such period for (x) Debt Service on Floating Rate Debt, (y) Debt Service on Fixed Rate Debt, and (z) fees payable in connection with any other Consolidated Indebtedness secured by all or any part of the Properties in each case determined in accordance with generally accepted accounting principles.”

53.           The definition of “Government Authority in Schedule 1 of the Loan Agreement is hereby deleted in its entirety and is replaced with the following:

“Government Authority.  The United States of America, the State in which any of the properties comprising the Unencumbered Pool Properties is located, the city or town in which the land is located, and any political subdivision agency, authority, department, commission, board, bureau, or instrumentality of any of them.”

54.           The definition of “Hedging Contracts” in Schedule 1 of the Loan Agreement is hereby deleted in its entirety and is replaced with the following:

“Hedging Contracts means, interest rate swap agreements, interest rate cap agreements and interest rate collar agreements, or any other agreements or arrangements designed to protect the Borrower against fluctuations in interest rates or currency exchange rates entered into between (a) the Borrower and the Agent (or its affiliate) and/or any Lender  (or its affiliate), (b) if a Borrower Election of Early Termination has occurred under the applicable Hedging Contract, any such Hedging Contract made by Borrower and another Lender (or affiliate), and/or (c) if a Permitted Transfer has occurred under the applicable Hedging Contract, any such Hedging Contracts made by the Borrower and a Permitted Transferee.  “Borrower Election of Early Termination” shall mean that (i) Borrower has designated an Early Termination Date pursuant to (and as defined under) the applicable Hedging Contract, or (ii) Borrower has designated an Early Termination Date under the applicable Hedging Contract as a result of a Ratings Change.  “Permitted Transfer” shall mean a transfer under Section 6(b)(ii) or Section 7, as applicable, of the applicable Hedging Contract.  “Permitted Transferee” shall mean a permitted transferee under Section 6(b)(ii) or Section 7, as applicable, of the applicable Hedging Contract.”

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55.           The definition of “Permitted Liens” in Schedule 1 of the Loan Agreement is hereby deleted in its entirety and is replaced with the following:

“Permitted Liens.  Liens: (i) permitted by §9.4, (ii) for taxes unpaid and diligently contested in good faith by the Borrower unless payment is required prior to the contesting of any such taxes and provided no enforcement proceedings have been commenced with respect to any lien filed in connection with such dispute and adequate reserves have been established for such taxes, (iii) for assessments, governmental charges, liens for labor, materials or supplies which do not materially interfere with the use of the properties comprising the Unencumbered Pool Properties or the operation of the business of the Borrower and do not exceed in the aggregate at any one time $5,000,000.00, (iv) liens on a property existing at the time of acquisition and refinancings of such liens, (v) liens on any 1031 Property consisting of any liens of FSP, a Wholly Owned Subsidiary or the 1031 Intermediary, (vi) liens securing Indebtedness permitted under Section 10.2(e), and (vii) other liens which do not exceed in the aggregate at any one time $1,000,000.00.”

56.           The definition of “Project Approvals” in Schedule 1 of the Loan Agreement is hereby deleted in its entirety and is replaced with the following:

“Project Approvals.  All approvals, consents, waivers, orders, agreements, acknowledgments, authorizations, permits and licenses required under applicable Requirements or under the terms of any restriction, covenant or easement affecting any of the properties comprising the Unencumbered Pool Properties, or otherwise necessary or desirable, for the ownership, acquisition, construction, equipping, use, occupancy and operation of any of the properties comprising the Unencumbered Pool Properties, whether obtained from a Governmental Authority or any other Person.”

57.           The definition of “Required Lenders” in Schedule 1 of the Loan Agreement is hereby deleted in its entirety and is replaced with the following:

“Required Lenders.  As of any date, the Lenders holding at least sixty percent (60%) of the outstanding principal amount of the Notes on such date; and if no such principal is outstanding, the Lenders whose aggregate Commitments constitute at least sixty percent (60%) of the Total Commitment; provided, however, as long as there are only two (2) Lenders, Required Lenders shall require that both Lenders concur on any decision requiring Required Lenders’ consent.”

58.           The definition of “Requirements” in Schedule 1 of the Loan Agreement is hereby deleted in its entirety and is replaced with the following:

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“Requirements.  Any law, ordinance, code, order, rule or regulation of any Governmental Authority relating in any way to the acquisition, ownership, construction, use, occupancy and operation of the properties comprising the Unencumbered Pool Properties.”

59.           Schedule 1 of the Loan Agreement is hereby amended by deleting the following definitions therein:

(a)           Borrowing Base Properties

(b)           Debt Service on the Loan

(c)           Overline Amount

(d)           Overline Facility

(e)           Overline Loan

(f)           Value of the Borrowing Base Properties

60.           Schedule 1 of the Loan Agreement is hereby amended by adding the following new definitions thereto:

“Debt Service Charges on Unencumbered Properties.  Shall mean, for any fiscal period of the Borrower, without duplication, the sum of the expenses of the Borrower for such period for (x) Unsecured Floating Rate Debt Service, (y) Unsecured Fixed Rate Debt Service, and (z)  fees payable in connection with any other unsecured Indebtedness for borrowed money of the Borrower, in each case determined in accordance with generally accepted accounting principles.”

“Debt Service on Fixed Rate Debt.  Shall mean the principal and interest payable for the applicable reporting period on (x)  the outstanding  principal amount of loans under the Term Loan plus (y) any other Indebtedness for borrowed money with respect to which the interest rate is fixed for three or more years based on the original term of such Indebtedness (including any Indebtedness which by its terms is calculated at a floating rate but which is hedged pursuant to interest rate swap contracts), in each case determined in accordance with generally accepted accounting principles.”

“Debt Service on Floating Rate Debt.  Shall mean the principal and interest payable on the outstanding loan balance of any Indebtedness bearing interest at a floating rate (excluding any Indebtedness which by its terms is calculated at a floating rate but which is hedged pursuant to interest rate swap contracts, for example the Indebtedness under the Term Loan) for the applicable reporting period.  Debt Service on Floating Rate Debt shall be calculated based upon the greater of: (i) the actual interest rate in effect under the applicable loan for the test period plus principal payments based upon a twenty (20) year amortization schedule, or (ii) the greater of (I) the rate for the ten (10) year United States Treasury obligations in amounts approximating the principal balance of the Loan during the test period plus one hundred eighty five (185) basis points, or (II) seven and one-half percent (7.5%) per annum, plus in the case of (I) and (II), principal payments based upon a twenty (20) year amortization schedule.”

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“Executive Order. Shall mean Executive Order No. 13224, 66 Fed. Reg. 49079 published September 25, 2001 or any similar executive orders.”

“Intercreditor Agreement.  The intercreditor agreement of even date between the lenders under the Loan and the lenders under the Term Facility.”

“Other Properties.  Shall mean all real properties owned by a Borrower, other than Unencumbered Pool Properties.”

“Properties.  Collectively, the Unencumbered Pool Properties and the Other Properties.”

“Ratings Change means on any date, either Moody’s or S&P assigns a rating below the Rating Threshold (as defined below), or fails to assign a rating, to the unsecured, unguaranteed and unsupported senior long-term debt or other similar obligations of Citizens. As used herein, (x) “Moody’s” means Moody’s Investors Service, Inc., or any successor nationally recognized statistical rating organization, (y) “S&P” means Standard & Poor’s Ratings Services, or any successor nationally recognized statistical rating organization, and (z) “Rating Threshold” means (A) with respect to Moody’s, “Baa” and (B) with respect to S&P, BBB.

“Supermajority of Lenders.  As of any date, the Lenders holding at least seventy-five percent (75%) of the outstanding principal amount of the Notes on such date; and if no such principal is outstanding, the Lenders whose aggregate Commitments constitute at least seventy-five percent (75%) of the Total Commitment; provided, however, as long as there are only two (2) Lenders, a Supermajority of Lenders shall require that both Lenders concur on any decision requiring a Supermajority of Lenders’ consent.”

“Term Loan.  Means the term facility as evidenced by the Term Loan Agreement dated October ___, 2008 with a present maximum amount of $75,000,000 between the Borrower and the lenders thereunder, as may be amended, modified, restated or revised from time to time.”

“Unencumbered Pool Properties. Collectively, the real properties listed on Exhibit H - Unencumbered Pool Properties.  Exhibit H shall be deemed amended (A) to exclude real properties owned by the Borrower which have liens thereon which secure Indebtedness, (B) to include real properties owned by Borrower which are free of liens which secure Indebtedness (including any Indebtedness which may have previously existed but is subsequently repaid, satisfied or otherwise discharged) and (C) to reflect Acquisitions and dispositions of real properties pursuant to Section 9.15.  A real property shall be deemed to be included as an Unencumbered Pool Property if any lien thereon is of the type specified in clauses (i), (ii), (iii), and/or (v) of the definition of Permitted Liens.”

“Unsecured Fixed Rate Debt Service.  Debt Service on Fixed Rate Debt calculated with reference only to any applicable Indebtedness that is unsecured.”

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“Unsecured Floating Rate Debt Service.  Debt Service on Floating Rate Debt calculated with reference only to any applicable Indebtedness that is unsecured.”

“Value of the Properties.  As of the relevant date of determination the aggregate value of the Properties based upon the test quarter Net Operating Income multiplied by four (4) and divided by a 8.25% capitalization rate (7% for CBD Properties).  For any acquisitions made during a quarter the Net Operating Income will be calculated by dividing Net Operating Income by the number of months such asset(s) is owned during such test quarter multiplied by 3 to approximate a full quarter.”

“Value of the Unencumbered Pool Properties.  As of the relevant date of determination the aggregate value of all of the properties comprising the Unencumbered Pool Properties based upon the test quarter Net Operating Income multiplied by four (4) and divided by a 8.25% capitalization rate (7% for CBD Properties).  For any acquisitions made during a quarter the Net Operating Income will be calculated by dividing Net Operating Income by the number of months such asset(s) is owned during such test quarter multiplied by 3 to approximate a full quarter.”

61.           Schedule 2 of the Loan Agreement is hereby amended by deleting “FSP Austin N.W. Limited Partnership (MA)” therefrom, and adding “FSP East Baltimore Street LLC (DE)” and “FSP Park Ten Phase II Limited Partnership (TX)” thereto.

62.           Exhibit H of the Loan Agreement is hereby amended by deleting it in its entirety and replacing it with Exhibit H attached hereto.

63.           All of the terms and conditions of the Loan Documents (except as modified hereby) shall remain in full force and effect, and Borrower hereby confirms and ratifies all of the covenants contained in the Loan Agreement and the other Loan Documents in all respects as of the date hereof (except for those which expressly relate to an earlier date).

64.           Borrower represents and warrants to the best of its knowledge and belief that no Default or Event of Default has occurred and is continuing under the Loan Agreement or any other Loan Document.

65.           The Borrower represents, warrants and agrees that it has no claims, defenses, counterclaims or offsets against the Agent and the Lenders in connection with the Loan or any Loan Document, and to the extent that any such claim, defense, counterclaim or offset may exist on the date hereof, the Borrower hereby WAIVES and RELEASES the Agent and Lenders from same.

66.           This First Amendment shall take effect as a sealed instrument under the laws of The Commonwealth of Massachusetts as of the date first above written.

67.           This First Amendment may be executed in two or more counterparts each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

[Signature Pages Follow.]

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IN WITNESS WHEREOF, this First Amendment has been executed and delivered as an instrument under seal as of the date first above written.

WITNESS /s/ Scott Carter	FRANKLIN STREET PROPERTIES CORP., a Maryland corporation By:      /s/ George J. Carter Name: George J. Carter Title: President and Chief Executive Officer
	FSP HOLDINGS LLC, a Delaware limited liability company By:      /s/ George J. Carter Name: George J. Carter Title: President and Chief Executive Officer
	FSP INVESTMENTS LLC, a Massachusetts limited liability company By:     /s/ George J. Carter Name: George J. Carter Title: President
	FSP PROPERTY MANAGEMENT LLC, a Massachusetts limited liability company By:     /s/ George J. Carter Name: George J. Carter Title: Executive Vice President
	FSP PROTECTIVE TRS CORP., a Massachusetts corporation By:     /s/ George J. Carter Name: George J. Carter Title: President

[Signature Page to First Amendment to Loan Agreement]

FSP HILLVIEW CENTER LIMITED PARTNERSHIP,

a Massachusetts limited partnership

By:       FSP Holdings LLC, its General Partner

By:      /s/ George J. Carter

Name: George J. Carter

Title: President and Chief Executive Officer

FSP MONTAGUE BUSINESS CENTER CORP.,

a Delaware corporation

By:  /s/ George J. Carter

Name: George J. Carter

Title: President

FSP GREENWOOD PLAZA CORP.,

a Delaware corporation

By: /s/ George J. Carter

Name: George J. Carter

Title: President

FSP 380 INTERLOCKEN CORP.,

a Delaware corporation

By:  /s/ George J. Carter

Name: George J. Carter

Title: President

FSP 390 INTERLOCKEN LLC,

a Delaware limited liability company

By:  /s/ George J. Carter

Name: George J. Carter

Title: President

[Signature Page to First Amendment to Loan Agreement]

FSP BLUE LAGOON DRIVE LLC,

a Delaware limited liability company

By:  /s/ George J. Carter

Name: George J. Carter

Title: President

FSP ONE OVERTON PARK LLC,

a Delaware limited liability company

By:  /s/ George J. Carter

Name: George J. Carter

Title: President

FSP NORTHWEST POINT LLC,

a Delaware limited liability company

By:  /s/ George J. Carter

Name: George J. Carter

Title: President

FSP RIVER CROSSING LLC,

a Delaware limited liability company

By:  /s/ George J. Carter

Name: George J. Carter

Title: President

FSP BOLLMAN PLACE LIMITED PARTNERSHIP,

a Massachusetts limited partnership

By:       FSP Holdings LLC, its General Partner

By:  /s/ George J. Carter

Name: George J. Carter

Title: President and Chief Executive Officer

[Signature Page to First Amendment to Loan Agreement]

FSP SOUTHFIELD CENTRE LIMITED PARTNERSHIP,

a Massachusetts limited partnership

By:       FSP Holdings LLC, its General Partner

By:  /s/ George J. Carter

Name: George J. Carter

Title: President and Chief Executive Officer

FSP FOREST PARK IV NC LIMITED PARTNERSHIP,

 a North Carolina limited partnership

By:        FSP Forest Park IV LLC, its General Partner

By:  /s/ George J. Carter

Name: George J. Carter

Title: President

FSP PARK SENECA LIMITED PARTNERSHIP,

a Massachusetts limited partnership

By:       FSP Holdings LLC, its General Partner

By:  /s/ George J. Carter

Name: George J. Carter

Title: President and Chief Executive Officer

FSP ADDISON CIRCLE LIMITED PARTNERSHIP,

a Texas limited partnership

By:       FSP Addison Circle LLC, its General Partner

By:  /s/ George J. Carter

Name: George J. Carter

Title: President

[Signature Page to First Amendment to Loan Agreement]

FSP PARK TEN PHASE II LIMITED PARTNERSHIP,

a Texas limited partnership

By:       FSP Park Ten Development LLC, its General Partner

By:  /s/ George J. Carter

Name: George J. Carter

Title: President

FSP COLLINS CROSSING LIMITED PARTNERSHIP,

a Texas limited partnership

By:           FSP Collins Crossing LLC, its General Partner

By:  /s/ George J. Carter

Name: George J. Carter

Title: President

FSP ELDRIDGE GREEN LIMITED PARTNERSHIP,

a Texas limited partnership

By:           FSP Eldridge Green LLC, its General Partner

By:  /s/ George J. Carter

Name: George J. Carter

Title: President

FSP LIBERTY PLAZA LIMITED PARTNERSHIP,

a Texas limited partnership

By:           FSP Holdings LLC, its General Partner

By:  /s/ George J. Carter

Name: George J. Carter

Title: President and Chief Executive Officer

[Signature Page to First Amendment to Loan Agreement]

FSP PARK TEN PHASE II LIMITED PARTNERSHIP,

a Texas limited partnership

By:       FSP Park Ten Development LLC, its General Partner

By:  /s/ George J. Carter

Name: George J. Carter

Title: President

FSP COLLINS CROSSING LIMITED PARTNERSHIP,

a Texas limited partnership

By:       FSP Collins Crossing LLC, its General Partner

By:  /s/ George J. Carter

Name: George J. Carter

Title: President

FSP ELDRIDGE GREEN LIMITED PARTNERSHIP,

a Texas limited partnership

By:       FSP Eldridge Green LLC, its General Partner

By:  /s/ George J. Carter

Name: George J. Carter

Title: President

FSP LIBERTY PLAZA LIMITED PARTNERSHIP,

a Texas limited partnership

By:       FSP Holdings LLC, its General Partner

By:  /s/ George J. Carter

Name: George J. Carter

Title: President and Chief Executive Officer

[Signature Page to First Amendment to Loan Agreement]

FSP PARK TEN LIMITED PARTNERSHIP,

a Texas limited partnership

By:       FSP Park Ten LLC, its General Partner

By:  /s/ George J. Carter

Name: George J. Carter

Title: President

FSP WILLOW BEND OFFICE CENTER LIMITED PARTNERSHIP,

a Texas limited partnership

By:       FSP Willow Bend Office Center LLC, its General Partner

By:  /s/ George J. Carter

Name: George J. Carter

Title: President

FSP INNSBROOK CORP,

a Delaware corporation

By:  /s/ George J. Carter

Name: George J. Carter

Title: President

FSP EAST BALTIMORE STREET LLC,

a Delaware limited liability company

By:  /s/ George J. Carter

Name: George J. Carter

Title: President

[Signature Page to First Amendment to Loan Agreement]

RBS CITIZENS, NATIONAL ASSOCIATION,

Agent and Lender

By: /s/ Daniel R. Ouellette  

Name:  Daniel R. Ouellette

Title:  Senior Vice President

[Signature Page to First Amendment to Loan Agreement]

BANK OF AMERICA, N.A., Lender

By: /s/ Israel Lopez  

Name:  Israel Lopez

Title:  Senior Vice President

[Signature Page to First Amendment to Loan Agreement]

CHEVY CHASE BANK, F.S.B., Lender

By: /s/ Carlos L Heard  

Name:  Carlos L. Heard

Title:  Group Vice President

[Signature Page to First Amendment to Loan Agreement]

WACHOVIA BANK, NATIONAL ASSOCIATION, Lender

By: /s/ Louis M. Ricchione  

Name:  Louis M. Ricchione

Title:  Vice President

  Real Estate Management

[Signature Page to First Amendment to Loan Agreement]

SCHEDULE 1

FSP HOLDINGS LLC, a Delaware limited liability company

FSP INVESTMENTS LLC, a Massachusetts limited liability company

FSP PROPERTY MANAGEMENT LLC, a Massachusetts limited liability company

FSP PROTECTIVE TRS CORP., a Massachusetts corporation

FSP HILLVIEW CENTER LIMITED PARTNERSHIP, a Massachusetts limited partnership

FSP MONTAGUE BUSINESS CENTER CORP., a Delaware corporation

FSP GREENWOOD PLAZA CORP., a Delaware corporation

FSP 380 INTERLOCKEN CORP., a Delaware corporation

FSP 390 INTERLOCKEN LLC, a Delaware limited liability company

FSP BLUE LAGOON DRIVE LLC, a Delaware limited liability company

FSP ONE OVERTON PARK LLC, a Delaware limited liability company

FSP NORTHWEST POINT LLC, a Delaware limited liability company

FSP RIVER CROSSING LLC, a Delaware limited liability company

FSP BOLLMAN PLACE LIMITED PARTNERSHIP, a Massachusetts limited partnership

FSP SOUTHFIELD CENTRE LIMITED PARTNERSHIP, a Massachusetts limited partnership

FSP FOREST PARK IV NC LIMITED PARTNERSHIP, a North Carolina limited partnership

FSP PARK SENECA LIMITED PARTNERSHIP, a Massachusetts limited partnership

FSP ADDISON CIRCLE LIMITED PARTNERSHIP, a Texas limited partnership

FSP COLLINS CROSSING LIMITED PARTNERSHIP, a Texas limited partnership

FSP ELDRIDGE GREEN LIMITED PARTNERSHIP, a Texas limited partnership

FSP LIBERTY PLAZA LIMITED PARTNERSHIP, a Texas limited partnership

FSP PARK TEN LIMITED PARTNERSHIP, a Texas limited partnership

FSP WILLOW BEND OFFICE CENTER LIMITED PARTNERSHIP, a Texas limited partnership

FSP INNSBROOK CORP, a Delaware corporation

FSP EAST BALTIMORE STREET LLC, a Delaware limited liability company

FSP PARK TEN PHASE II LIMITED PARTNERSHIP, a Texas limited partnership

EXHIBIT H UNENCUMBERED POOL PROPERTIES
Unencumbered Pool Property Name	Subsidiary name
Hillview Center Milpitas, California	FSP Hillview Center Limited Partnership
Montague Business Center	FSP Montague Business Center Corp.
Greenwood Plaza	FSP Greenwood Plaza Corp.
380 Interlocken	FSP 380 Interlocken Corp.
390 Interlocken	FSP 390 Interlocken LLC
Blue Lagoon	FSP Blue Lagoon Drive LLC
Overton Park	FSP One Overton Park LLC
Northwest Point	FSP Northwest Point LLC
River Crossing	FSP River Crossing LLC
Bollman Place	FSP Bollman Place Limited Partnership
Southfield Centre	FSP Southfield Centre Limited Partnership
Forest Park	FSP Forest Park IV NC Limited Partnership
Park Seneca	FSP Park Seneca Limited Partnership
Addison Circle	FSP Addison Circle Limited Partnership
Park Ten Phase II	FSP Park Ten Phase II Limited Partnership

Collins Crossing	FSP Collins Crossing Limited Partnership
Eldridge Green	FSP Eldridge Green Limited Partnership
Liberty Plaza	FSP Liberty Plaza Limited Partnership
Park Ten	FSP Park Ten Limited Partnership
Willow Bend Office Center	FSP Willow Bend Office Center Limited Partnership
Innsbrook	FSP Innsbrook Corp.
East Baltimore Street	FSP East Baltimore Street LLC
Properties held directly by the FSP	Properties held directly by the FSP
Centennial Park	Centennial
Meadow Point	Meadow Point
Timberlake	Timberlake
Timberlake East	Timberlake East
Federal Way	Federal Way

EX-99.1

Exhibit 99.1

PRESS RELEASE	Franklin Street Properties Corp.
401 Edgewater Place · Suite 200 · Wakefield, Massachusetts  01880-6210 · (781) 557-1300 ·www.franklinstreetproperties.com
	Contact:  Donna Brownell:  877-686-9496

FOR IMMEDIATE RELEASE

FRANKLIN STREET PROPERTIES CORP. CLOSES

$75 MILLION UNSECURED TERM LOAN FACILITY

WAKEFIELD, MA – October 15, 2008 – Franklin Street Properties Corp. (“FSP”) (NYSE Alternext US: FSP), an investment firm specializing in real estate, announced today that it has closed on a $75 million unsecured term loan facility with RBS Citizens, National Association, Bank of America, N.A. and Wachovia Bank, National Association.  The term loan facility has an initial three-year term that matures on October 15, 2011.  In addition, FSP has the right to extend the initial maturity date for up to two successive one-year periods, or until October 15, 2013 if both extensions are exercised.  FSP fixed the interest rate for the initial three-year term of the term loan facility at 5.84% per annum pursuant to an interest rate swap agreement. The proceeds of the term loan facility will be used to pay down a portion of the outstanding balance on FSP’s existing $250 million revolving line of credit facility.  FSP intends to use the increased availability under its existing revolving line of credit facility for property acquisitions.  Additional information on the term loan facility can be found in FSP’s Current Report on Form 8-K that is being filed with the United States Securities and Exchange Commission today.

George J. Carter, President and Chief Executive Officer of FSP, commented as follows:

“We are pleased to continue and expand our banking relationships with RBS Citizens, Bank of America and Wachovia Bank, all of whom are participants in our existing $250 million revolving line of credit facility.  We are excited about the potential property investment opportunities that this term loan facility will allow us to pursue.As the capital markets and U.S. economy work through the current real estate mortgage/debt crunch, we will continue to pursue additional property investment opportunities. It will be FSP's objective to continue to grow its property portfolio and rental income business during this period of liquidity-constrained capital markets by using its balance sheet strength to help finance and fund new acquisitions. We continue to be very optimistic about FSP's position in the current commercial real estate investment market and the opportunities that may present themselves as a result of the current distress surrounding some aspects of those markets.”

About Franklin Street Properties Corp.

Franklin Street Properties Corp., based in Wakefield, Massachusetts, is focused on achieving current income and long-term growth through investments in commercial properties.  FSP operates in two business segments: real estate operations and investment banking/investment services.  The majority of FSP’s property portfolio is suburban office buildings, with select investments in certain central business district properties.  FSP’s subsidiary, FSP Investments LLC (member, FINRA and SIPC), is a real estate investment banking firm and a registered broker/dealer.  FSP is a Maryland corporation that operates in a manner intended to qualify as a real estate investment trust (REIT) for federal income tax purposes.  To learn more about FSP please visit our website at www.franklinstreetproperties.com.

Forward-Looking Statements

Statements made in this press release that state FSP's or management's intentions, beliefs, expectations, or predictions for the future, including statements relating to potential property acquisitions, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  This press release may also contain forward-looking statements based on current judgments and current knowledge of management, which are subject to certain risks, trends and uncertainties that could cause actual results to differ materially from those indicated in such forward-looking statements. Accordingly, readers are cautioned not to place undue reliance on forward-looking statements. Investors are cautioned that our forward-looking statements involve risks and uncertainty, including the possibility that FSP may not be able to acquire properties with the proceeds of the term loan facility.  See the "Risk Factors" set forth in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2007, as the same may be updated from time to time in subsequent filings with the United States Securities and Exchange Commission. Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. We will not update any of the forward-looking statements after the date of this press release to conform them to actual results or to changes in our expectations that occur after such date, other than as required by law.