REAFFIRMATION, CONSENT TO TRANSFER AND SUBSTITUTION OF INDEMNITOR

Exhibit 10.5

REAFFIRMATION, CONSENT TO TRANSFER

AND SUBSTITUTION OF INDEMNITOR

THIS REAFFIRMATION, CONSENT TO TRANSFER AND SUBSTITUTION OF INDEMNITOR (this “Agreement”) is made and entered into as of June 29, 2010, by and among the following parties:

GLENBOROUGH TIERRASANTA, LLC, a Delaware limited liability company having an address, immediately prior to the consummation of the Transfer (as defined below), of ▇▇▇ ▇. ▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇^▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (“Borrower”);

▇.

▇▇▇▇▇▇ ▇▇▇▇▇▇▇ REAL ESTATE FUND V U.S., L.P., MSP REAL ESTATE FUND V, L.P., ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ REAL ESTATE INVESTORS V U.S., L.P., ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ REAL ESTATE FUND V SPECIAL U.S., L.P., MSP CO-INVESTMENT PARTNERSHIP V, L.P., AND MSP CO-INVESTMENT PARTNERSHIP V-A, L.P., each a Delaware limited partnership, having an address of ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (each, an “Original Indemnitor,” and collectively, “Original Indemnitors”);

GLENBOROUGH FUND XIV, L.P., a Delaware limited partnership having an address of ▇▇▇ ▇. ▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇^▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (“Assignor”);

▇.

▇▇▇▇▇▇ PACIFIC PROPERTIES, L.P., a Maryland limited partnership having an address of ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (“Assignee”); and

U.S. BANK NATIONAL ASSOCIATION, as Trustee for the Registered Holders of CD 2007-CD4 Commercial Mortgage Trust, Commercial Mortgage Pass-Through Certificates, Series CD 2007-CD4, whose mailing address is ▇/▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇.▇., ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇^▇▇ Floor, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attn: Portfolio Manager (“Lender”).

RECITALS

1. German American Capital Corporation (“Original Lender”), pursuant to the Loan Documents (as defined below) made a loan to Borrower in the original principal amount of $14,300,000.00 (the “Loan”). The Loan is evidenced and/or secured by the following documents:

(a) Note dated November 28, 2006, by Borrower to Original Lender in the original principal amount of $14,300,000.00 (the “Note”);

(b) Mortgage, Deed of Trust, Security Agreement, Financing Statement, Fixture Filing and Assignment of Leases, Rents and Security Deposits of even date with the Note, from Borrower, as Borrower, to Lawyers Title Insurance Corporation, as Trustee, in favor of Original Lender, as Lender, recorded as Document # 2006-0880027 in the Official Records of the Office of the County Recorder, San Diego County, California (the “Recorder’s Office”) (the “Mortgage”);

(c) Assignment of Leases, Rents and Security Deposits of even date with the Note, from Borrower in favor of Original Lender, recorded as Document # 2006-0880028 in the Recorder’s Office;

(d) UCC-1 Financing Statements with Borrower as debtor and Original Lender as secured party, (i) recorded as Document # 2006-0881056 in the Recorder’s Office and (ii) filed as File No. 64337622 with the Delaware Secretary of State;

(e) Guaranty of Recourse Obligations of even date with the Note, made by and among Original Indemnitors to Original Lender (the “Indemnity Agreement”);

(f) Environmental Indemnity of even date with the Note, made by and among Borrower and Original Indemnitors to Original Lender (the “Environmental Indemnity Agreement”); and

(g) Loan and Security Agreement of even date with the Note, between Borrower and Original Lender (the “Loan Agreement”).

The foregoing documents, together with any and all other documents executed by Borrower or Original Indemnitor in connection with the Loan, are collectively referred to as the “Loan Documents.” Capitalized terms defined in the Loan Agreement, used herein and not otherwise defined herein, shall have the meanings given them in the Loan Agreement.

2. Original Lender assigned, sold and transferred its interest in the Loan and the Loan Documents and Lender is the current holder of all of Original Lender’s interest in the Loan and the Loan Documents, as evidenced by, among other things, certain instruments recorded as Documents # 2007-701703 and 2009-646703 in the Recorder’s Office.

3. Borrower (i) continues to be the owner of fee title to the Real Property, and (ii) has an interest in all other property, in each case as described in and encumbered by the Mortgage and the other Loan Documents (collectively, the “Property”).

4. Pursuant to that certain Contribution Agreement dated as of February 15, 2010, by and among Assignor, Glenborough Acquisition, LLC, Assignee and ▇▇▇▇▇▇ Pacific Properties, Inc. (the “Contribution Agreement”), Assignor agreed to contribute all of Assignor’s membership interests in Borrower (representing 100% of the ownership interests of Borrower) (the “Transferred Ownership Interests”) to Assignee in exchange for cash, OP Units (as defined in the Contribution Agreement) in the Assignee and/or Series A Preferred OP Units (as defined in the Contribution Agreement in the Assignee. The transfer contemplated in this Recital 4 is hereinafter referred to as the “Transfer”.

5. The parties acknowledge and agree that Article 8 of the Mortgage requires the consent of Lender for the Transfer. Borrower, Original Indemnitors, Assignor and Assignee have requested that Lender consent to the Transfer subject to conditions contained in the Mortgage, the Loan Documents and this Agreement.

6. Borrower, Original Indemnitors, Assignor and Assignee have also requested that Lender consent to the substitution of Assignee as “Indemnitor” and/or “Guarantor” under the Indemnity Agreement and the Environmental Indemnity Agreement, the assumption by Assignee of all the obligations of Original Indemnitors under the Indemnity Agreement and the Environmental Indemnity Agreement (the “Substitution”), and to the release of the Original Indemnitors from all of their obligations from and after the date hereof under the Loan Documents, including, without limitation, the Indemnity Agreement and the Environmental Indemnity Agreement (the “Release”).

7. Lender is willing to consent to the Transfer, the Substitution and the Release on and subject to the terms and conditions set forth in this Agreement, the Mortgage and the other Loan Documents, as amended hereby.

STATEMENT OF AGREEMENT

In consideration of the mutual covenants and agreements set forth herein, the parties hereto hereby agree as follows:

1. Certain Representations, Warranties and Covenants Regarding the Transfer.

(a) Assignor hereby represents and warrants to Lender that it is the owner of the Transferred Ownership Interests, that the Transferred Ownership Interests are unencumbered, that contemporaneously with the execution and delivery hereof, the Transferred Ownership Interests are being conveyed and transferred to Assignee, and that Assignor is not obtaining or retaining any security interest or other direct interest in the Transferred Ownership Interests.

(b) Assignee hereby represents and warrants to Lender, as of the date hereof, that simultaneously with the execution and delivery hereof, Assignee (i) has acquired from Assignor all of the Transferred Ownership Interests, (ii) has not conveyed or granted Assignor or any other party any security interest or other direct interest in the Transferred Ownership Interests and (iii) has been appointed as the sole member of Borrower, subject to the Amended Borrower Organizational Documents (as defined below).

(c) Borrower and Assignor each hereby represent and warrant to Lender that the organizational documents of Borrower, as delivered to Original Lender in connection with the closing of the Loan (the “Borrower Organizational Documents”), have not been modified, amended, altered or changed since the date of the closing of the Loan.

(d) Borrower and Assignee each hereby represent and warrant to Lender that, other than the substitution of Assignee as the owner of the Transferred Ownership Interests, the Transfer will not result in any modification, amendment, alteration or change to the Borrower Organizational Documents except as set forth in the Amended and Restated Limited Liability Company Agreement of Borrower of even date with this Agreement and such other amendments and/or restatements of the other Borrower Organizational Documents as shall be delivered by Borrower and/or Assignee to Lender in connection with the Transfer (such Borrower Organizational Documents, as so amended, the “Amended Borrower Organizational Documents”). Assignee hereby covenants and agrees that it will

be bound by the provisions of the Amended Borrower Organizational Documents. Borrower and Assignee covenant and agree that Borrower will remain a Special Purpose Entity throughout the term of the Loan in accordance with the terms of the Loan Documents, as amended hereby.

2. Additional Representations, Warranties and Covenants of Borrower, Original Indemnitors and Assignor.

(a) Borrower hereby represents, warrants and covenants to Lender, as of the date hereof, that:

(i) the Mortgage is a valid first Lien on the Property for the full unpaid principal amount of the Loan and all other amounts as stated therein;

(ii) to the knowledge of Borrower, no Default or Event of Default has occurred and is continuing under the provisions of the Note, the Mortgage, the Indemnity Agreement, the Environmental Indemnity Agreement or the other Loan Documents, all as modified hereby;

(iii) there are no defenses, set-offs or rights of defense, set-off or counterclaim whether legal, equitable or otherwise to the obligations evidenced by or set forth in the Note, the Mortgage, the Indemnity Agreement, the Environmental Indemnity Agreement or the other Loan Documents, all as modified hereby;

(iv) all provisions of the Note, the Mortgage, the Indemnity Agreement, the Environmental Indemnity Agreement and the other Loan Documents are in full force and effect, except as modified herein;

(v) to the knowledge of Borrower, there are no Liens of any kind against the Property, except for Permitted Encumbrances; and

(vi) except as set forth in the updated Schedules VII, VIII, X, XI and XIII attached hereto, the representations and warranties made by Borrower in the Mortgage, the Note, the Loan Documents, or in any other documents or instruments delivered in connection with the Note, the Mortgage or the Loan Documents, are true, on and as of the date hereof, in all material respects, with the same force and effect as if made on and as of the date hereof, except to the extent that such representations and warranties specifically relate to an earlier date, then in such event, such representations were true and correct in all material respects as of such earlier date.

(b) Each Original Indemnitor (for itself and not jointly with any other Original Indemnitor) hereby represents, warrants and covenants to Lender, as of the date hereof, that:

(i) to the knowledge of such Original Indemnitor, no Default or Event of Default has occurred and is continuing under the provisions of the Indemnity Agreement or the Environmental Indemnity Agreement;

(ii) there are no defenses, set-offs or rights of defense, set-off or counterclaim whether legal, equitable or otherwise to the obligations of such Original Indemnitor evidenced by or set forth in the Indemnity Agreement or the Environmental Indemnity Agreement; and

(iii) all provisions of the Indemnity Agreement and the Environmental Indemnity Agreement are in full force and effect, except as modified herein.

(c) Each Original Indemnitor (for itself and not jointly with any other Original Indemnitor) and Assignor each hereby covenants and agrees that from and after the date hereof, Lender may deal solely with Borrower (as newly constituted) and Assignee in all matters relating to the Loan, the Loan Documents (as modified hereby) and the Property, and that Lender has no further duty or obligation of any nature relating to this Loan or the Loan Documents (as modified hereby) to Original Indemnitors and/or Assignor.

(d) Each Original Indemnitor, Borrower and Assignor understand and intend that Lender shall rely on the representations, warranties and covenants of such Original Indemnitor, Borrower and Assignor contained herein.

3. Additional Representations, Warranties and Covenants of Borrower and Assignee.

(a) Assignee hereby represents and warrants to Lender, as of the date hereof, that:

(i) to the knowledge of Assignee, based solely on Borrower and each Original Indemnitor’s representations contained herein, no Default or Event of Default has occurred and is continuing under the provisions of the Note, the Mortgage, the Indemnity Agreement, the Environmental Indemnity Agreement or the other Loan Documents, all as modified hereby; and

(ii) to the knowledge of Assignee, all provisions of the Loan Documents are in full force and effect, except as modified herein.

(b) Borrower hereby covenants and agrees for the benefit of Lender as follows:

(i) Borrower shall continue to perform all of its respective obligations imposed under the Note, the Mortgage, the Indemnity Agreement, the Environmental Indemnity Agreement and the other Loan Documents, all as modified hereby;

(ii) Borrower shall continue to pay when and as due all sums due under the Note and the other Loan Documents, all as modified hereby; and

(iii) Borrower shall not hereafter, without Lender’s prior consent in accordance with the terms of the Loan Documents, further encumber the Property or sell or transfer the Property or any interest therein, except as may be specifically permitted in the Loan Documents, as modified hereby.

(iv) Borrower shall, within ten (10) days of the date hereof, deliver to Lender evidence reasonably satisfactory to Lender that the annual insurance premium for the insurance to be maintained with respect to the Property as required by the Loan Agreement has been paid. Borrower’s failure to deliver the evidence to Lender required by this Subsection (iv) shall constitute a default under the Loan.

(c) Assignee hereby covenants and agrees for the benefit of Lender that Assignee, in its capacity as “Indemnitor” or “Guarantor,” as applicable, shall perform all the respective obligations imposed under the Indemnity Agreement and the Environmental Indemnity Agreement, each as modified hereby. Assignee understands and intends that Lender shall rely on the representations, warranties and covenants of Assignee contained herein.

4. Consent and Reaffirmation of Borrower.

(a) Borrower hereby represents and warrants to Lender that it has reviewed the Contribution Agreement, this Agreement and all the documents executed in accordance therewith or herewith. Borrower consents to the Transfer, the Substitution, and the Release under the terms of the Contribution Agreement and this Agreement. Borrower further covenants and agrees that the Transfer, the Substitution and the Release shall not, and shall not be deemed to, impair, limit, abrogate or reduce in any manner or to any extent the liability or obligations of Borrower under the Loan Documents.

(b) Borrower hereby renews, reaffirms, ratifies and confirms the Note, the Mortgage and the other Loan Documents and acknowledges and agrees that the Loan Documents remain in full force and effect without impairment and without modification, except as specifically provided in this Agreement, and that no rights or remedies of Lender under the Loan Documents, as modified hereby, have been waived. Borrower reaffirms the truth and accuracy in all material respects of all representations and warranties made by Borrower in the Loan Documents, as hereby modified, as if made on the date hereof, except to the extent that such representations and warranties specifically relate to an earlier date, then in such event, such representations were true and correct in all material respects as of such earlier date.

(c) Borrower agrees to continue to pay, perform and discharge each and every obligation of payment and performance under, pursuant to and as set forth in the Note, the Mortgage, the Environmental Indemnity Agreement and the other Loan Documents at the time, in the manner and otherwise in all respects as therein provided, all as modified hereby.

(d) Borrower hereby acknowledges, agrees and warrants that: (i) there are no rights of set-off or counterclaim, nor any defenses of any kind, whether legal, equitable or otherwise, which would enable Borrower to avoid or delay timely performance of its obligations under the Note, the Mortgage, the Environmental Indemnity Agreement or the Loan Documents, as applicable, all as modified hereby; (ii) there are no monetary Liens of any kind or nature against the Property except for Permitted Encumbrances; and (iii) all rights, priorities, titles, liens and equities securing the payment of the Note are expressly recognized as valid and are in all things renewed, continued and preserved in force to secure payment of the Note, all as modified hereby.

5. Obligations of Assignee. From and after the date of this Agreement, Assignee shall be obligated and responsible for the performance of each and all of the obligations and agreements of Original Indemnitors under the Indemnity Agreement and the Environmental Indemnity Agreement, each as modified hereby, and Assignee shall be liable and responsible for each and all of the liabilities of Original Indemnitors thereunder, as fully and completely as if Assignee had originally executed and delivered the Indemnity Agreement and the Environmental Indemnity Agreement, each as hereby modified, including, without limitation, all of those obligations, agreements and liabilities which would have, but for the provisions of this Agreement, been the obligations, agreements and liabilities of Original Indemnitors thereunder. From and after the date hereof, Assignee hereby agrees to pay, perform and discharge each and every obligation of payment and performance of Original Indemnitors under, pursuant to and as set forth in the Indemnity Agreement and the Environmental Indemnity Agreement, each as modified hereby, at the time, in the manner and otherwise in all respects as therein provided.

Assignee acknowledges and agrees that, following the Transfer, it will be an affiliate of Borrower and will derive substantial economic benefit from Lender’s agreement to consent to the Transfer and that there is adequate consideration for the Substitution. Assignee acknowledges that Lender would not consent to the Transfer without the agreement of Assignee to execute and deliver this Agreement as substitute indemnitor.

Assignor acknowledges and agrees that the foregoing provisions of this Section 5 shall be for the sole benefit of Lender and nothing contained in this Agreement shall be deemed or construed to relieve Assignor of any of its duties, covenants, representations, warranties or obligations under, and in accordance with the terms of, the Contribution Agreement or any other document or instrument executed and delivered by Assignor pursuant to the terms thereof.

6. Consent to Transfer. Subject to the terms and conditions set forth in this Agreement, Lender hereby (i) consents to the Transfer, subject to the Mortgage and the other Loan Documents, all as modified hereby, and (ii) agrees that the consummation of the Transfer shall not constitute a Default or an Event of Default under any of the Loan Documents, as modified hereby. Lender’s consent to the Transfer shall, however, not constitute its consent to any subsequent transfers of the Property or any interest therein, except as may be specifically permitted in the Loan Documents, as modified hereby.

7. Consent to Substitution and Release of Original Indemnitors. Subject to the terms and conditions set forth in this Agreement, Lender consents to the Substitution. From and after the date of this Agreement, each Original Indemnitor shall, with respect only to those matters first arising or accruing on or after the date of this Agreement, be fully and unconditionally released of any and all liability under the Loan Documents, as modified hereby, including, without limitation, its obligations as the “Indemnitor” or “Guarantor,” as applicable, under the Indemnity Agreement and Environmental Indemnity Agreement, each as modified hereby, and Assignee shall be substituted, in each and every respect, for Original Indemnitors in lieu of and in place of Original Indemnitors with respect to each and every reference to the “Indemnitor” or “Guarantor,” as applicable, in the Loan Documents, as hereby modified, including, without limitation, the

Indemnity Agreement and Environmental Indemnity Agreement, each as modified hereby. Each Original Indemnitor hereby acknowledges and agrees that the release set forth in this Section 7 shall not be construed to release any Original Indemnitor from any liability under the Indemnity Agreement and Environmental Indemnity Agreement for any acts or events occurring or obligations arising prior to the date of this Agreement, whether or not such acts, events or obligations are, as of the date of this Agreement, known or ascertainable.

8. Lender Estoppel. Lender hereby represents and warrants to Borrower, each Original Indemnitor, Assignee and Assignor that, to the “actual knowledge of Lender:” (i) as of the date hereof, no Event of Default under the Loan Documents has occurred and is continuing, and (ii) no facts or circumstances exist which, through the passage of time, would constitute an Event of Default. For purposes of this paragraph, the “actual knowledge of Lender” shall mean the actual knowledge of employees of ▇▇▇▇▇ Fargo Bank, N.A. (“▇▇▇▇▇ Fargo”) actively involved with the transactions described herein or with the servicing of the Loan without any independent inquiry or investigation. The “actual knowledge of Lender” shall not include knowledge imputed from other Lender Parties or other groups or employees of ▇▇▇▇▇ Fargo not actively involved in the servicing of the Loan. Lender reserves the right to declare any existing Event of Default which is not currently known but which subsequently comes to the attention of Lender.

9. Notices to Borrower and Indemnitor. Without amending, modifying or otherwise affecting the provisions of the Loan Documents except as expressly set forth herein, Lender shall, from and after the date of this Agreement, deliver any notices to the “Borrower” or the “Indemnitor” or “Guarantor,” as applicable, which are required to be delivered pursuant to the Loan Documents, or are otherwise delivered by Lender at Lender’s sole discretion, to Borrower’s address or Assignee’s address, as the case may be, set in the Loan Documents, as modified hereby, as applicable. In addition, all references to the address of the “Borrower” and all references to the address of the “Indemnitor” or “Guarantor,” as applicable, in the Loan Documents are hereby modified to refer to Borrower’s address or Assignee’s address, as the case may be, as set forth in the Loan Agreement, as modified hereby.

10. Release and Covenant Not to ▇▇▇. Borrower, each Original Indemnitor, Assignor and Assignee, on behalf of themselves and their heirs, successors and assigns, hereby release and forever discharge Lender, Original Lender, each of their predecessors in interest and their successors and assigns, together with any officers, directors, partners, employees, investors, certificate holders and agents (including, without limitation, servicers of the loan) of each of the foregoing (collectively, “Lender Parties”), from all debts, accountings, bonds, warranties, representations, covenants, promises, contracts, controversies, agreements, claims, damages, judgments, executions, actions, inactions, liabilities, demands or causes of action of any nature, at law or in equity, known or unknown (the “Claims”), which Borrower, such Original Indemnitor, Assignor or Assignee now have by reason of any cause, matter or thing through and including the date hereof including, without limitation, matters arising out of or relating to: (a) the Loan including, without limitation, its funding, administration and servicing; (b) the Loan Documents; (c) the Property; (d) any reserve or escrow balances held by Lender or any servicers of the Loan, but only to the extent the same has been held, used or applied by Lender in accordance with the terms of the Loan Documents, as modified hereby; (e) the Transfer or Substitution (collectively, the “Released Claims”); and (f) any other disclosed agreement or transaction between Borrower, any Original Indemnitor, Assignor or Assignee and Lender Parties relating to the Loan. Borrower,

each Original Indemnitor, Assignor and Assignee, on behalf of themselves and their heirs, successors and assigns, covenant and agree never to institute or cause to be instituted or continue prosecution of any suit or other form of action or proceeding of any kind or nature whatsoever against any of Lender Parties by reason of or in connection with any of the Released Claims; provided, however, that nothing contained herein shall be deemed or construed to prevent or otherwise restrict any Original Indemnitor from raising as a defense against any Claims made by any Lender Parties the release of such Original Indemnitor made by Lender pursuant to Section 7 hereof.

11. Acknowledgment of Indebtedness. This Agreement recognizes the reduction of the principal amount of the Note and the payment of interest thereon to the extent of payments made by Borrower prior to the date of this Agreement. The parties acknowledge and agree that, as of the date of this Agreement, the unpaid principal balance of the Note is $14,300,000.00 and interest on the Note is paid to May 31, 2010. Borrower and Assignee acknowledge and agree that the Loan, as evidenced and secured by the Loan Documents, as modified hereby, is a valid and existing indebtedness payable by Borrower to Lender.

12. Interest Accrual Rate and Monthly Installment Payment Amount to Remain the Same. The parties acknowledge and agree that the interest rate and the monthly payments set forth in the Note shall remain unchanged. Prior to the occurrence of an Event of Default hereunder or under the Loan Documents, as modified hereby, interest shall accrue on the principal balance outstanding from time to time at the interest rate set forth in the Note (which does not include such amounts as may be required to fund any escrow and reserve obligations under the terms of the Loan Documents, as modified hereby), and shall continue to be paid in accordance with the terms of the Note.

13. Modifications of the Loan Documents. The Loan Documents are hereby modified as follows:

(a) The definition of Borrower Parents in Section 1.1 of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“Borrower Parents shall mean, collectively, the REIT (as hereinafter defined) and the Operating Partnership (as hereinafter defined).”

(b) The definition of Environmental Indemnity in Section 1.1 of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“Environmental Indemnity shall mean that certain Environmental Indemnity, dated as of the date hereof, by Borrower and as assumed by Operating Partnership in favor of Lender, as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time.”

(c) The definition of Holding Company in Section 1.1 of the Loan Agreement is hereby deleted in its entirety, and all references to, or provisions relating to, “Holding Company” in the Loan Agreement are hereby deleted in their entirety.

(d) The definition of Holding Company LP Agreement in Section 1.1 of the Loan Agreement is hereby deleted in its entirety, and all references to, or provisions relating to, “Holding Company LP Agreement” in the Loan Agreement are hereby deleted in their entirety.

(e) The definition of Manager in Section 1.1 of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“Manager shall mean ▇▇▇▇▇▇ OP Management, LLC, or such other Qualified Manager as now or hereafter becomes manager of the Property in accordance with the provisions hereof.”

(f) The definition of MSREF Entity in Section 1.1 of the Loan Agreement is hereby deleted in its entirety, and all references to, or provisions relating to, “MSREF Entity” in the Loan Agreement are hereby deleted in their entirety.

(g) The definition of Permitted Debt in Section 1.1 of the Loan Agreement is hereby amended as follows by deleting subsections (d) and (e) are deleted in their entirety and replacing subsection (d) with the following:

“and (d) any indebtedness of any Borrower Parents or any Persons holding any direct or indirect interests in any of Borrower Parents.”

(h) The definition of Recourse Guaranty in Section 1.1 of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“Recourse Guaranty shall mean that certain Guaranty of Recourse Obligations of Borrower, dated as of the date hereof, as assumed by Operating Partnership, as the same may be amended, supplemented, restated or otherwise modified from time to time.”

(i) The definition of Single Purpose Entity is hereby deleted in its entirety and replaced with the following:

“Single Purpose Entity shall mean a Person, other than an individual, which (i) is formed or organized solely for the purpose of owning, holding, developing, using, selling, leasing, managing, exchanging, operating and financing, directly or indirectly, an ownership interest in the Property, (ii) does not engage in any business unrelated to its direct or indirect interest in the Property and the acquisition, ownership, development, use, operation and financing thereof, (iii) has not and will not have any assets other than those related to its direct or indirect interest in the Property or the operation, management and financing thereof or any indebtedness other than the Permitted Debt, (iv) maintains its own separate books and records and its own accounts, in each case which are separate and apart from the books and records and accounts of any other Person, except to the extent that it is disregarded for federal income tax purposes (v) holds itself out as being a Person, separate and apart from any other Person, (vi) does not and will not commingle its funds or assets with those of any other Person, except as contemplated in this Agreement, except that it and its Affiliates may participate in a cash management system pursuant to a

written agreement reasonably acceptable to Lender, so long as all of its cash balances are accurately tracked and reflected in the books and records of such Affiliate responsible for implementing such cash management system, (vii) conducts its own business in its own name; (viii) maintains separate financial statements, provided, however, it may utilize consolidated financial statements, so long as such statements contain a note indicating that its separate assets and liabilities are neither available to pay the debt of the consolidated entity nor constitute obligations of the consolidated entity, (ix) except as contemplated in this Agreement and the Loan Documents pays its own liabilities out of its own funds, (x) observes in all material respects all partnership, corporate or limited liability company formalities, as applicable, (xi) pays the salaries of its own employees, if any, and maintains a sufficient number of employees, if any, in light of its contemplated business operations, (xii) except as contemplated in this Agreement and the Loan Documents, does not guarantee or otherwise obligate itself with respect to the debts of any other Person or hold out its credit as being available to satisfy the obligations of any other Person, (xiii) does not acquire obligations or securities of its partners, members or shareholders, (xiv) allocates fairly and reasonably shared expenses, including, without limitation, any overhead for shared office space, if any, (xv) uses separate stationary, invoices, and checks, (xvi) maintains an arms-length relationship with its Affiliates, (xvii) does not and will not pledge its assets for the benefit of any other Person or make any loans or advances to any other Person (other than pursuant to the Loan Documents), (xviii) does and will continue to use commercially reasonable efforts to correct any known misunderstanding regarding its separate identity, (xix) maintains adequate capital in light of its contemplated business operations, and (xx) has not and will not engage in, seek, or consent to the dissolution, winding up, liquidation, consolidation or merger and except as otherwise permitted in this Agreement and the other Loan Documents, has not and will not engage in, seek or consent to any asset sale, transfer or partnership, membership or shareholder interests, except as permitted in this Agreement and the other Loan Documents or material amendments of its partnership or operating agreement, certificate of incorporation, articles of organization or other organizational document unless approved by Lender, which approval shall not be unreasonably withheld. In addition, if such Person is a partnership, (1) all general partners, if any, of such Person shall be Single Purpose Entities; and (2) if such Person has more than one general partner, then the organizational documents shall provide that such Person shall continue (and not dissolve) for so long as a solvent general partner exists. In addition, if such Person is a corporation, then, at all times: (a) such Person shall have at least two (2) Independent Directors and (b) the board of directors of such Person may not take any action requiring the unanimous affirmative vote of 100% of the members of the board of directors unless all of the directors, including the Independent Directors, shall have participated in such vote. In addition, if such Person is a limited liability company, (a) such Person shall have at least two (2) Independent Managers or Independent Members, (b) if such Person is managed by a board of managers, the board of managers of such Person may not take any action requiring the unanimous affirmative vote of 100% of the members of the board of managers unless all of the managers, including the Independent Managers, shall have participated in such vote, (c) if such Person is not managed by a board of managers, the members of such Person may not take any action requiring the affirmative vote of 100% of the members of such Person unless all of the members, including the Independent Members, shall have participated in such vote, and (d) its operating agreement shall provide

that until all of the Indebtedness and Obligations are paid in full, such entity will not dissolve. In addition, the organizational documents of such Person shall provide that such Person (1) without the unanimous consent of all of the partners, directors or members, as applicable, shall not with respect to itself or to any other Person in which it has a direct or indirect legal or beneficial interest, except as permitted in the Loan Documents, (a) seek or consent to the appointment of a receiver, liquidator, assignee, trustee, sequestrator, custodian or other similar official for the benefit of the creditors of such Person or all or any portion of such Person’s property, or (b) take any action that might cause such Person to become insolvent, petition or otherwise institute insolvency proceedings or otherwise seek any relief under any laws relating to the relief from debts or the protection of debtors generally, (2) has and will maintain its books, records, resolutions and agreements as official records, (3) has held and will hold its assets in its own name, (4) has and will maintain its financial statements, accounting records and other organizational documents, books and records separate and apart from any other Person, (5) has not and will not identify its partners, members or shareholders, or any affiliates of any of them as a division or part of it, (6) has and will maintain an arms length relationship with its Affiliates, and (7) has not and will not enter into or be a party to any transaction with its partners, members, shareholders, or its Affiliates except in the ordinary course of business and on terms which are intrinsically fair and are no less favorable to it than would be obtained in a comparable arms length transaction with a third party.”

(j) The definition of Sponsor in Section 1.1 of the Loan Agreement is hereby deleted in its entirety, and all references to, or provisions relating to, “Sponsor” in the Loan Agreement are hereby deleted in their entirety.

(k) The following defined terms are added to Section 1.1 of the Loan Agreement:

“Approved Bank shall mean a commercial bank with a long term debt rating of “A” or better (or a comparable long term debt obligation rating) as assigned by the Rating Agencies and otherwise reasonably satisfactory to Lender.”

“Operating Partnership shall mean ▇▇▇▇▇▇ Pacific Properties, L.P., a Maryland limited partnership.”

“REIT shall mean ▇▇▇▇▇▇ Pacific Properties, Inc., a Maryland corporation.”

(l) The phrase “thirty (30) days” appearing in the last sentence of Section 6.1.1 of the Loan Agreement is hereby amended to read “ten (10) days.”

(m) The phrase “(covering Borrower’s obligation to indemnify Lender as required under this Agreement, and shall provide “Products and Completed Operations Liability” coverage).” appearing in Section 6.1.2 of the Loan Agreement is hereby amended to read “(covering Borrower’s obligation to indemnify lender as required under this Agreement, to the extent available, and shall provide “Products and Completed Operations Liability” coverage)”.

(n) The percentage “twenty-five percent (25%)” appearing in of Section 6.1.10 of the Loan Agreement is hereby amended to read “forty percent (40%).”

(o) Notwithstanding anything to the contrary in Article VI of the Loan Agreement, Borrower shall not be required to provide certified copies of any insurance policies, it being understood that delivery of originals or copies of such policies shall satisfy Borrower’s obligations to deliver the same.

(p) The phrase “thirty (30) days” appearing in such Section 6.1.11 of the Loan Agreement is hereby amended to read “ten (10) days.”

(q) The phrase “thirty (30) days” appearing in Section 6.1.12 of the Loan Agreement is hereby amended to read “ten (10) days.”

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

“Section 8.1 Restrictions on Transfers. Unless such action is permitted by the provisions of this Article VIII, Borrower shall not, and shall not permit any other Person holding any direct or indirect ownership interest in Borrower or the Property to, except with the prior written consent of Lender, (i) Transfer all or any part of the Property, or (ii) permit any Transfer (directly or indirectly) of any interest in Borrower, Borrower Parent, any SPE Entity, or the Property (other than pursuant to Leases of a space to tenants in accordance with this Agreement).”

(s) Subsections (vi) – (viii) of Section 8.5(b) of the Loan Agreement are hereby deleted in their entirety and replaced with the following:

“(vi) Borrower Parents shall at all times maintain at least a 30% direct or indirect, equity interest in Borrower, (vii) Borrower Parents shall maintain management and control of Borrower and the Property, and (viii) Operating Partnership shall deliver to lender written affirmation of its obligations under the Recourse Guaranty and the Environmental Indemnity.”

(t) Section 8.5(c) of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“(c) Notwithstanding the foregoing provisions of this Article VIII, no Lender approval, Rating Agency Confirmation or delivery of a Non-Consolidation Opinion shall be necessary or requested to effect or consummate any Transfers of interests in or of Borrower to any Affiliate of any Borrower Parent provided that (i) Borrower shall provide Lender with at least thirty (30) days prior written notice thereof, (ii) immediately prior to such Transfer, no Event of Default shall have occurred and be continuing, (iii) there is no Change of Control and the persons responsible for the day to day management of the property remains unchanged, and (iv) Borrower shall pay (y) to Lender a transfer fee equal to one half of one percent (0.5%) of the outstanding Principal Amount of the Loan and (z) all of Lender’s fees, costs and expenses, including, without limitation, reasonable attorney’s fees and costs, actually incurred by Lender in contraction with such Transfer. For purposes

of this Section 8.5(c) only, a “Change of Control” shall mean a change in the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of the Controlled entity, whether through the ownership of voting securities or other beneficial interest, by contract or otherwise.”

(u) The following is added as Section 8.5(d) of the Loan Agreement:

“(d) Notwithstanding the foregoing provisions of this Article VIII, for so long as REIT and the Operating Partnership are Borrower Parents, the issuance, sale, conveyance, transfer, disposition, alienation, hypothecation, pledge or encumbrance (whether voluntary or involuntary or directly or indirectly) of (i) any securities, options, warrants or other interests in the REIT (a “REIT Transfer”) or (ii) partnership interests and other interests in the Operating Partnership (an “OP Transfer”) shall be permitted without Lender’s prior written consent and no transfer fee shall be payable in connection therewith, provided that any such REIT Transfer and/or OP Transfer, as the case may be, does not (i) result in a Change in Control (hereinafter defined) of the REIT and/or the Operating Partnership or (ii) result in a change in control of the Property; provided, however, that (A) at all times the public issuance and/or trading of stock of the REIT shall at all times be permitted and (B) any REIT Transfer and/or OP Transfer, as the case may be, that would result from a merger and/or acquisition and/or consolidation of the REIT or the Operating Partnership, as the case may be, by or into any other Person shall not be permitted without Lender’s prior written consent. Notwithstanding the foregoing:

(1) So long as a Change in Control does not occur, no consent of the Lender shall be required in connection with a merger of the REIT into or an acquisition of the REIT by a Qualified Transferee (hereinafter defined), so long as the following conditions are met:

(A) The REIT or the surviving entity if such entity is not the REIT (the “REIT Successor”), shall continue to own 100% of the direct and indirect general partnership interests in the Operating Partnership, and the Operating Partnership shall continue to own 100% of the direct and indirect membership interests in Borrower.

(B) Lender must be given at least thirty (30) days prior written notice of the REIT Transfer, giving sufficient detail of the proposed transaction. This shall include, but not be limited to, a pro-forma balance sheet as of the expected date of the REIT Transfer.

(C) Borrower and Operating Partnership, in its capacity as an indemnitor/guarantor of the Loan, shall execute and deliver to a ratification agreement in form and content satisfactory to Lender in its reasonable discretion, ratifying their existing obligations under the Loan Documents and confirming that there has been no change in Borrower’s organizational documents or Operating Partnership’s organizational documents.

(D) Borrower shall reimburse Lender for all of Lender’s reasonable out of pocket costs and expenses related to the REIT Transfer, without limitation, Lender’s reasonable attorney’s fees and costs and the costs of Rating Agency review, if applicable, and shall pay to Lender a transfer fee equal to one percent (1%) of the outstanding Principal Amount of the Loan.

(2) If a Change in Control does occur in connection with a REIT Transfer and/or an OP Transfer, consent of the Lender shall be required in accordance with Article 8 of this Loan Agreement, and provided that such REIT Transfer is to a Qualified Transferee, such consent shall not be unreasonably withheld so long as all conditions set forth in Section 8.5(d)(1) hereinabove are satisfied and the provisions of Article 8 are satisfied.

(3) No REIT Transfer or OP Transfer shall relieve Borrower, Operating Partnership, as indemnitor/guarantor of the Loan, or the REIT (except where the REIT is not the surviving entity, and in such event the REIT Successor shall have assumed the REIT’s obligations under the Loan Documents) of any of their respective obligations and liabilities under the Note or any of the other Loan Documents.

For purposes of this Section 8.5(d), the term “Change in Control” shall mean (i) a change in the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of the controlled entity, whether through the ownership of voting securities or other beneficial interest, by contract or otherwise, or (ii) any transfer of interests or series of transfers of interests in the REIT which results in more than 49% of the ownership interests of the REIT or the surviving entity, as applicable, being held by any single person or entity or related group of people or entities which does not currently own more than 49% of the interests in the REIT.

For purposes of this Section 8.5(d), the term “Qualified Transferee” is defined as follows: Only one of the following:

(A) a real estate investment trust, bank, saving and loan association, investment bank, insurance company, trust company, commercial credit corporation, pension plan, pension fund or pension advisory firm, mutual fund, government entity or plan, provided that any of the foregoing entities referred to in this clause (A) satisfies the Eligibility Requirements;

(B) an investment company, money management firm or “qualified institutional buyer” within the meaning of Rule 144A under the Securities Act of 1933, as amended, or an institutional “accredited investor” within the meaning of Regulation D under the Securities Act of 1933, as amended, provided that any of the foregoing entities referred to in this clause (B) satisfies the Eligibility Requirements;

(C) an institution substantially similar to any of the foregoing entities described in clauses (A) or (B) that satisfies the Eligibility Requirements;

(D) any entity Controlled by any of the entities described in clauses (A) or (B) above;

(E) an investment fund, limited liability company, limited partnership or general partnership where a Permitted Fund Manager or an entity that is otherwise a Qualified Transferee under clauses (A), (B), (C) or (D) of this definition acts as the general partner, managing member or fund manager and at least 50% of the equity interests in such investment vehicle are owned, directly or indirectly, by one or more entities that are otherwise Qualified Transferees under clauses (A), (B), (C) or (D) of this definition; and

(F) is not a Prohibited Person.

For purposes of this Section 8.5(d), and notwithstanding anything to the contrary in Section 1.1 of the Loan Agreement, the term “Eligibility Requirements” means, with respect to any entity, that such entity (i) has capital/statutory surplus or shareholder’s equity in excess of $600,000,000, and (ii) is regularly engaged in the business of making or owning commercial real estate loans or operating commercial mortgage properties and has not less than seven (7) years of experience with the management of commercial real estate comparable to the Property and has a reputation in the industry reasonably equivalent to, or better than that of, the REIT, or is otherwise satisfactory to Lender in its reasonable discretion. For purposes of this Section, the term “Permitted Fund Manager” means, with respect to any entity, that such entity (i) is a nationally-recognized manager of investment funds investing in debt or equity interests relating to commercial real estate, or (ii) is a commercial real estate manager that controls or manages at least $500,000,000 in real estate equity assets.

Other than as specifically provided above, the terms and provisions of Article 8 of the Loan Agreement shall remain in full force and effect.”

(v) The phrase “Holding Company” appearing several times in Section 11.2.3 of the Loan Agreement is hereby amended to read “the REIT” in each instance.

(w) Section 19.3 of the Loan Agreement is hereby deleted in its entirety and replaced with the following:

“THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE IN WHICH THE PROPERTY IS LOCATED, PROVIDED THAT TO THE EXTENT THAT ANY OF SUCH LAWS MAY NOW OR HEREAFTER BE PREEMPTED BY FEDERAL LAW, SUCH FEDERAL LAW SHALL SO GOVERN AND BE CONTROLLING, AND PROVIDED FURTHER THAT THE LAWS OF THE STATE IN WHICH THE PREMISES IS LOCATED SHALL GOVERN AS TO THE CREATION, PRIORITY AND ENFORCEMENT OF LIENS AND SECURITY INTERESTS IN THE PROPERTY LOCATED IN SUCH STATE.”

(x) The addresses for notices set forth in Section 19.6 of the Loan Agreement shall be deemed deleted and the following substituted therefor:

“If to Lender:

▇/▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇.▇.

▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇^▇▇ Floor

▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇

▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇

Attn: Asset Manager

With a copy to:

▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇, PLLC

▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇

▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇

Attn: J. ▇▇▇▇▇ ▇▇▇▇▇, Esq.

If to Borrower:

c/o Hudson Pacific Properties, L.P.

▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇

▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇

Attn: Chief Financial Officer

With copies to:

▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, LLP

▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇^▇▇ ▇▇▇▇▇

▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇

Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇”

(y) The following shall be added as Article XX to the Loan Agreement:

“XX. Collateral Reserve.

Section 20.1 Reserve Accounts Generally.

20.1.1 As additional security for the payment and performance by Borrower of all duties, responsibilities and obligations under the Note and the other Loan Documents, Borrower hereby unconditionally and irrevocably assigns, conveys, pledges, mortgages, transfers, delivers, deposits, sets over and confirms unto Lender, and hereby grants to Lender a security interest in (i) the Collateral Reserve (as hereinafter defined), and any other reserve or escrow account established pursuant to the terms hereof or any other Loan Document, (ii) the accounts into which the Collateral Reserve has been deposited, (iii) all insurance on said accounts, (iv) all accounts, contract rights and general intangibles or other rights and interests pertaining thereto, (v) all sums now or hereafter therein or represented thereby, (vi) all replacements, substitutions or proceeds thereof, (vii) all instruments and documents now or hereafter evidencing the Collateral Reserve or such accounts, (viii) all powers, options, rights, privileges and immunities pertaining to the Collateral Reserve (including the right to make withdrawals therefrom), and (ix) all proceeds of the foregoing. Borrower hereby authorizes and consents to the account into which the Collateral Reserve have been deposited being held in Lender’s name or the name of any entity servicing the Note for Lender and hereby acknowledges and agrees that Lender, or at Lender’s election, such servicing agent, shall have exclusive control over said account. Notice of the assignment and security interest granted to Lender herein may be delivered by Lender at any time to the financial

institution wherein the Collateral Reserve have been established, and Lender, or such servicing entity, shall have possession of all passbooks or other evidences of such accounts. Borrower hereby assumes all risk of loss with respect to amounts on deposit in the Collateral Reserve. Borrower hereby knowingly, voluntarily and intentionally stipulates, acknowledges and agrees that the advancement of the funds from the Collateral Reserve as set forth herein is at Borrower’s direction and is not the exercise by Lender of any right of set-off or other remedy upon a Default or an Event of Default. Borrower hereby waives all right to withdraw funds from the Collateral Reserve except as provided for in this Loan Agreement. If an Event of Default shall occur hereunder or under any other of the Loan Documents Lender may, without notice or demand on Borrower, at its option: (A) withdraw any or all of the funds (including, without limitation, interest) then remaining in the Collateral Reserve and apply the same, after deducting all costs and expenses of safekeeping, collection and delivery (including, but not limited to, reasonable attorneys’ fees, costs and expenses) to the Obligations in such manner as Lender shall deem appropriate in its sole discretion, and the excess, if any, shall be paid to Borrower, (B) exercise any and all rights and remedies of a secured party under any applicable Uniform Commercial Code, or (C) exercise any other remedies available at law or in equity. No such use or application of the funds contained in the Collateral Reserve shall be deemed to cure any Default or Event of Default.

20.1.2 The Collateral Reserve shall not, unless otherwise explicitly required by applicable law, be or be deemed to be escrow or trust funds, but, at Lender’s option and in Lender’s discretion, may either be held in a separate account or be commingled by Lender with the general funds of Lender. The Collateral Reserve is solely for the protection of Lender and entails no responsibility on Lender’s part beyond the payment of the respective items for which they are held following receipt of bills, invoices or statements therefor in accordance with the terms hereof and beyond the allowing of due credit for the sums actually received. Upon assignment of this Loan Agreement by Lender, any funds in the Collateral Reserve shall be turned over to the assignee and any responsibility of Lender, as assignor, with respect thereto shall terminate. If there is an Event of Default under this Loan Agreement or any other Loan Documents, Lender may, but shall not be obligated to, apply at any time the balance then remaining in any or all of the Collateral Reserve against the Obligations in whatever order Lender shall subjectively determine. No such application of any or all of the Collateral Reserve shall be deemed to cure any Event of Default.

Section 20.2 Collateral Reserve. As additional security for the Obligations, on or before June 29, 2010, Borrower shall either (i) deposit an amount equal to $700,000 the “Cash Deposit” into a reserve established with Lender, or (ii) deliver to Lender an irrevocable standby letter of credit number, issued by an Approved Bank in the amount of $700,000 (the “Collateral Reserve L/C”), which such standby letter of credit shall be a Letter of Credit as defined herein. If Borrower shall deliver a Collateral Reserve L/C, then Borrower hereby pledges and grants to Lender a security interest in and to the Collateral Reserve L/C and any and all proceeds which the Lender may realize from any draw on the Collateral Reserve L/C. If Borrower has delivered a Collateral Reserve L/C, then upon the occurrence of an Event of Default, Lender shall have the right to draw upon the Collateral Reserve L/C and deposit the funds into a reserve established with Lender. The reserve established in connection with either (i) the Cash Deposit, or (ii) from proceeds received by Lender upon a draw of the Collateral Reserve L/C, as applicable, shall be referred to herein as the “Collateral Reserve.” Upon the occurrence of an Event of Default, Lender shall have the right to apply the Collateral Reserve to the Obligations in accordance with the terms hereof.

If Borrower initially elects to make the Cash Deposit with Lender, then, so long as no Event of Default has occurred and is continuing, Borrower may at anytime upon ten (10) days prior notice to Lender substitute the same for a Collateral Reserve L/C, and upon receipt by Lender of such Collateral Reserve L/C, Lender shall return to Borrower the Cash Deposit then held by Lender.

Upon full payment of the Obligations in accordance with its terms or at such earlier time as Lender may elect, the balance of any or all of the Collateral Reserve or any Collateral Reserve L/C then in Lender’s possession shall be paid over or returned, as applicable, to Borrower and no other party shall have any right or claim thereto. Upon maturity of the loan, Borrower may elect to use the funds then on deposit in the Collateral Reserve, if any, as a credit against the total amount due and payable to Lender.”

(z) Exhibit C of the Loan Agreement is hereby deleted in its entirety.

(aa) Exhibit H of the Loan Agreement is hereby deleted and replaced with Exhibit H attached hereto.

(bb) Exhibit O of the Loan Agreement is hereby supplemented with Exhibit O attached hereto, it being acknowledged that each of the Standard Form Lease attached as Exhibit O to the Loan Agreement or as Exhibit O attached hereto are each hereby approved by Lender.

(cc) Schedules VII, VIII, X, XI and XIII attached to the Loan Agreement are hereby deleted and replaced with Schedules VII, VIII, X, XI and XIII attached hereto.

(dd) The “Granting Clause” of the Mortgage is hereby modified by adding the following as items (xiii):

“(xiii) all cash funds, deposit accounts, letter of credit proceeds and other rights and evidence of rights to cash, now or hereafter created or held by Lender pursuant to this Security Instrument or any other of the Loan Documents (as hereinafter defined), including, without limitation, all funds now or hereafter on deposit in the Collateral Reserve (as defined in the Loan Agreement).”

(ee) Section 12(g) of the Mortgage is hereby deleted in its entirety and replaced with the following:

“THIS SECURITY INSTRUMENT WILL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE IN WHICH THE PROPERTY IS LOCATED, PROVIDED THAT TO THE EXTENT THAT ANY OF SUCH LAWS MAY NOW OR HEREAFTER BE PREEMPTED BY FEDERAL LAW, SUCH FEDERAL LAW SHALL SO GOVERN AND BE CONTROLLING, AND PROVIDED FURTHER THAT THE LAWS OF THE STATE IN WHICH THE PREMISES IS LOCATED SHALL GOVERN AS TO THE CREATION, PRIORITY AND ENFORCEMENT OF LIENS AND SECURITY INTERESTS IN THE PROPERTY LOCATED IN SUCH STATE.”

(ff) Section 12(m) of the Mortgage is hereby deleted in its entirety and replaced with the following:

“(m) Intentionally omitted.”

(gg) All references to “MSREF” in the Environmental Indemnity Agreement shall be replaced with “▇▇▇▇▇▇ Pacific Properties, L.P.”.

(hh) Section 4(l) of the Environmental Indemnity Agreement and Section 8(k) of the Indemnity Agreement are hereby deleted in its entirety and replaced with the following:

“THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE IN WHICH THE PROPERTY IS LOCATED, EXCEPT TO THE EXTENT THAT THE APPLICABILITY OF ANY OF SUCH LAWS MAY NOW OR HEREAFTER BE PREEMPTED BY FEDERAL LAW, IN WHICH CASE SUCH FEDERAL LAW SHALL SO GOVERN AND BE CONTROLLING.”

(ii) Section 8(m) of the Assignment is hereby deleted in its entirety and replaced with the following:

“THIS ASSIGNMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE IN WHICH THE PROPERTY IS SITUATED, EXCEPT TO THE EXTENT THAT ANY OF SUCH LAWS MAY NOW OR HEREAFTER BE PREEMPTED BY FEDERAL LAW, IN WHICH CASE SUCH FEDERAL LAW SHALL SO GOVERN AND BE CONTROLLING.”

(jj) Section 5(k) of the Note is hereby deleted in its entirety and replaced with the following:

“THIS NOTE SHALL BE INTERPRETED, CONSTRUED AND ENFORCED ACCORDING TO THE LAWS OF THE STATE IN WHICH THE PROPERTY (AS DEFINED IN THE LOAN AGREEMENT) IS LOCATED.”

(kk) The first sentence of Section 2 of the Indemnity is hereby deleted in its entirety and replaced with the following:

“Guarantor hereby unconditionally, irrevocably and absolutely guarantees to Lender (i) the prompt and unconditional payment of all obligations and liabilities of Borrower for which Borrower shall be personally liable pursuant to Section 18.2 of the Loan Agreement, and (ii) the due and punctual payment of the Note limited to an amount equal to the principal sum of seven hundred thousand and 00/100 dollars ($700,000). This principal sum of seven hundred thousand and 00/100 dollars ($700,000) guaranteed pursuant to this Section 2 shall not be reduced by any installment payments and permitted principal payments pursuant to the terms of the Note, but shall remain fixed sum notwithstanding any such payments of principal (collectively, the Guaranteed Obligations).”

14. Conditions. This Agreement shall be of no force and effect until each of the following conditions has been met to the complete satisfaction of Lender:

(a) Fees and Expenses. Borrower shall pay, or cause to be paid (i) all costs and expenses incident to the preparation and execution hereof and the consummation of the transactions contemplated hereby, including reasonable legal fees of Lender’s counsel, and (ii) a transfer fee to Lender being one half of one percent (0.5%) of the outstanding principal balance of the Note as of the date of this Agreement, the next regularly scheduled monthly payment due under the Loan, and the other fees and expenses outlined in the beneficiary statement distributed to the parties by Lender.

(b) Other Conditions. Satisfaction of all requirements under the closing checklist for this transaction as determined by Lender and Lender’s counsel in their sole discretion.

15. Default.

(a) Breach. Any breach by Borrower or Assignee of the representations and warranties contained herein shall constitute an Event of Default. Any breach by Original Indemnitors or Assignor of the representations and warranties contained herein shall constitute a default by Original Indemnitors or Assignor, as the case may be, under this Agreement.

(b) Failure to Comply. Any failure by Borrower or Assignee to fulfill any one of the conditions set forth in this Agreement shall constitute a default under this Agreement and an Event of Default. Any failure by Original Indemnitors or Assignor to fulfill any one of the conditions in this Agreement shall constitute a default by Original Indemnitors or Assignor, as the case may be, under this Agreement.

16. Further Representations, Warranties and Covenants of Borrower. As a condition of this Agreement, Borrower represents and warrants to Lender, as of the date hereof, as follows:

(a) Borrower is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Delaware and is authorized to transact business and in good standing in the State of California. Borrower has full power and authority to enter into and carry out the terms of this Agreement and to continue to carry out the terms of the Loan Documents.

(b) This Agreement and all other documents executed by Borrower in connection with constitutes the legal, valid and binding obligations of Borrower enforceable in accordance with their terms, except as enforceability thereof may be limited by bankruptcy, insolvency or other similar laws of general application affecting the enforcement of creditors’ rights or general equitable principals, whether applied in law or equity. Neither the entry into nor the performance of and compliance with this Agreement has resulted or will result in any violation of, or a conflict with or a default under, any judgment, decree, order, mortgage, indenture, contract, agreement or lease by which Borrower or any property of Borrower is bound, or any statute, rule or regulation applicable to Borrower.

(c) The Loan Documents, as modified hereby, constitute the legal, valid and binding obligations of Borrower, enforceable in accordance with their terms, except as enforceability thereof may be limited by bankruptcy, insolvency or other similar laws of general application affecting the enforcement of creditors’ rights or general equitable principals, whether applied in law or equity. Neither the entry into nor the performance of and compliance with the Loan Documents, as modified hereby, this Agreement has resulted or will result in any violation of, or a conflict with or a default under, any judgment, decree, order, mortgage, indenture, contract, agreement or lease by which Borrower or any property of Borrower is bound, or any statute, rule or regulation applicable to Borrower.

(d) There is no action, proceeding or investigation pending or, to knowledge of Borrower, threatened which questions, directly or indirectly, the validity or enforceability of this Agreement or the Loan Documents, as modified hereby, or any action taken or to be taken pursuant hereto or thereto, or which might result in any material adverse change in the condition (financial or otherwise) or business of Borrower.

(e) To the knowledge of Borrower, there has been no legislative action, regulatory change, revocation of license or right to transact business, fire, explosion, flood, drought, windstorm, earthquake, accident, other casualty or act of God, labor trouble, riot, civil commotion, condemnation or other action or event which has had any material adverse effect on the business or condition (financial or otherwise) of Borrower or any of its properties or assets, whether insured against or not, since the request for the Transfer was submitted to Lender.

(f) Borrower has not received any written notices from any governmental entity claiming that Borrower or the Property is not presently in compliance with any laws, ordinances, rules and regulations bearing upon the use and operation of the Property including, without limitation, any notice relating to zoning laws or building code regulations.

(g) The certified rent roll provided to Lender and certified as of the date hereof is a true, complete and accurate summary of all leases (“Tenant Leases” or individually, a “Tenant Lease”) affecting the Property in all material respects as of the date of this Agreement. No rent has been prepaid under any Tenant Lease except rent for the current month. To the knowledge of Borrower, each Tenant Lease has been duly executed and delivered by, and is a binding obligation of, the respective tenant, except as enforceability thereof may be limited by bankruptcy, insolvency or other similar laws of general application affecting the enforcement of creditors’ rights or general equitable principals, whether applied in law or equity, and each Tenant Lease is in full force and effect. Each Tenant Lease is fully and freely assignable by the landlord without notice to or the consent of the tenant thereunder.

(h) Borrower will not permit the transfer of any interest in Borrower to any person or entity (or any beneficial owner of such entity) who is listed on the specifically Designated Nationals and Blocked Persons List maintained by the Office of Foreign Asset Control, Department of the Treasury pursuant to Executive Order No. 13224, 66 Fed. Reg. 49079 (Sept. 25, 2001) or any other list of terrorists or terrorist organizations maintained pursuant to any of the rules and regulations of Office of Foreign Asset Control, Department of the Treasury or pursuant to any other applicable Executive Orders (such lists are collectively referred to as the “OFAC Lists”). Borrower will not knowingly enter into a lease with any party who is listed on the OFAC Lists. Borrower shall immediately notify Lender if Borrower has knowledge that any member or beneficial owner of Borrower is listed on the OFAC Lists or is (A) indicted on or (B) arraigned and held over on charges involving money laundering or predicate crimes to money laundering. Borrower shall immediately notify Lender if Borrower knows that any tenant is listed on the OFAC Lists or (A) is convicted on, (B) pleads nolo contendere to, (C) is indicted on, or (D) is arraigned and held over on charges involving money laundering or predicate crimes to money laundering. Borrower further represents and warrants to Lender that Borrower is currently not on the OFAC list.

(i) No representation or warranty of Borrower made in this Agreement contains any untrue statement of material fact or omits to state a material fact necessary in order to make such representations and warranties not misleading in light of the circumstances under which they are made.

Any breach of Borrower of any of the representations and warranties shall constitute an Event of Default under the Mortgage and the other Loan Documents, as modified hereby.

17. Further Representations, Warranties and Covenants of Assignee. As a condition of this Agreement, Assignee represents and warrants to Lender, as of the date hereof, as follows:

(a) Assignee is a limited partnership duly organized, validly existing and in good standing under the laws of the State of Maryland, and is authorized to transact business as a foreign limited partnership in each jurisdiction in which such authorization is necessary for the operation of the business or properties of Borrower. Following the consummation of the Transfer, Assignee will be, and shall remain (subject to the Amended Borrower Organizational Documents), the sole member of Borrower and has full power and authority to enter into this Agreement on its own behalf and on behalf of Borrower, to own the Transferred Ownership Interests, to carry out the terms of the Indemnity Agreement and Environmental Indemnity Agreement, each as modified hereby, and to become obligated for the obligations of Original Indemnitor thereunder.

(b) This Agreement, the Contribution Agreement and all other documents executed by Assignee in connection therewith or herewith constitutes the legal, valid and binding obligations of Assignee enforceable in accordance with their terms, except as enforceability thereof may be limited by bankruptcy, insolvency or other similar laws of general application affecting the enforcement of creditors’ rights or general equitable principals, whether applied in law or equity. Neither the entry into nor the performance of

and compliance with this Agreement has resulted or will result in any violation of, or a conflict with or a default under, any judgment, decree, order, mortgage, indenture, contract, agreement or lease by which Assignee or any property of Assignee is bound, or any statute, rule or regulation applicable to Assignee.

(c) The Indemnity Agreement and Environmental Indemnity Agreement, each as modified hereby, constitute the legal, valid and binding obligations of Assignee, in its capacity as an “Indemnitor” or “Guarantor,” as applicable, enforceable in accordance with their terms, except as enforceability thereof may be limited by bankruptcy, insolvency or other similar laws of general application affecting the enforcement of creditors’ rights or general equitable principals, whether applied in law or equity. Neither the entry into nor the performance of and compliance with this Agreement, the Contribution Agreement or the other documents executed by Assignee in connection therewith or herewith has resulted or will result in any violation of, or a conflict with or a default under, any judgment, decree, order, mortgage, indenture, contract, agreement or lease by which Assignee or any property of Assignee is bound, or any statute, rule or regulation applicable to Assignee.

(d) There is no action, proceeding or investigation pending or, to knowledge of Assignee, threatened which questions, directly or indirectly, the validity or enforceability of this Agreement or the Indemnity Agreement or Environmental Indemnity Agreement, each as modified hereby, or any action taken or to be taken pursuant hereto or thereto, or which might result in any material adverse change in the condition (financial or otherwise) or business of Assignee.

(e) To the knowledge of Assignee, there has been no legislative action, regulatory change, revocation of license or right to transact business, fire, explosion, flood, drought, windstorm, earthquake, accident, other casualty or act of God, labor trouble, riot, civil commotion, condemnation or other action or event which has had any material adverse effect on the business or condition (financial or otherwise) of Assignee or any of its properties or assets, whether insured against or not, since the request for the Transfer was submitted to Lender.

(f) The financial statements and other data and information supplied by Assignee in connection with the request for the Transfer or otherwise supplied in contemplation of the Transfer were in all material respects true and correct on the dates they were supplied, and since their dates no material adverse change in the financial condition of Assignee has occurred, and there is not any pending or threatened litigation or proceedings which might impair to a material extent the business or financial condition of Assignee. Notwithstanding the foregoing, any projections and pro forma financial information supplied by Assignee or HPP (as hereinafter defined) in connection with Assignee’s request for the Transfer are based upon good faith estimates and assumptions believed by Assignee to be reasonable at the time made and, with respect to such projections and pro forma financial information, it is recognized by Lender that such projections as to future events are not to be viewed as facts and that actual results during the period or periods covered by any such projections may differ from the projected results and that the differences may be material.

(g) No representation or warranty of Assignee made in this Agreement contains any untrue statement of material fact or omits to state a material fact necessary in order to make such representations and warranties not misleading in light of the circumstances under which they are made.

Any breach of Assignee of any of the representations and warranties shall constitute an Event of Default under the Mortgage and the other Loan Documents, as modified hereby.

17. Representations, Warranties and Covenants of ▇▇▇▇▇▇ Pacific Properties, Inc.

(a) ▇▇▇▇▇▇ Pacific Properties, Inc. (“HPP”) represents and warrants to Lender that, as of the date hereof, HPP is a corporation duly organized, validly existing and in good standing under the laws of the State of Maryland, and is authorized to transact business as a foreign corporation in each jurisdiction in which such authorization is necessary for the operation of the business or properties of Borrower and Assignee. HPP is and shall remain the sole General Partner of Assignee and has full power and authority to enter into this Agreement on its own behalf and on behalf of Assignee.

(b) HPP hereby represents, warrants, covenants and agrees that at all times until the Obligations have been fully satisfied, HPP shall maintain (i) a Tangible Net Worth (as defined below) in excess of $232,500,000, and (ii) Liquid Assets (as defined below) having a market value in excess of $19,500,000. As used in this Agreement, “Tangible Net Worth” means, as of a given date, HPP’s equity calculated by subtracting total liabilities of HPP from total assets of HPP, with evidence of such valuation reasonably acceptable to Lender and as may be requested by Lender from time to time, but no more frequently than one time per calendar year. As used in this Agreement, “Liquid Assets” means assets in the form of cash, cash equivalents, obligations of (or fully guaranteed as to principal and interest by) the United States or any agency or instrumentality thereof (provided the full faith and credit of the United States supports such obligation or guarantee), certificates of deposit issued by a commercial bank having net assets of not less than $500 million, securities used and traded on a recognized stock exchange or traded over the counter and listed in the National Association of Securities Dealers Automatic Quotations, or liquid debt instruments that have a readily ascertainable value and are regularly traded in a recognized financial market.

18. Further Representations, Warranties and Covenants of Assignor. As a condition of this Agreement, Assignor represents and warrants to Lender as follows:

(a) Assignor is a limited partnership duly organized, validly existing and in good standing under the laws of the State of Delaware. Assignor has full power and authority to enter into and carry out the terms of this Agreement and to carry out the Transfer.

(b) This Agreement, the Contribution Agreement and all other documents executed by Assignor in connection therewith or herewith constitute legal, valid and binding obligations of Assignor enforceable in accordance with their respective terms, except as enforceability thereof may be limited by bankruptcy, insolvency or other similar

laws of general application affecting the enforcement of creditors’ rights or general equitable principals, whether applied in law or equity. Neither the entry into nor the performance of and compliance with this Agreement, the Contribution Agreement or the other documents executed by Assignor in connection therewith or herewith has resulted or will result in any violation of, or a conflict with or a default under, any judgment, decree, order, mortgage, indenture, contract, agreement or lease by which Assignor or any property of Assignor is bound, or any statute, rule or regulation applicable to Assignor.

(c) No representation or warranty of Assignor made in this Agreement contains any untrue statement of material fact or omits to state a material fact necessary in order to make such representations and warranties not misleading in light of the circumstances under which they are made.

18. Further Representations, Warranties and Covenants of Original Indemnitors. As a condition of this Agreement, each Original Indemnitor (for itself and not jointly with any other Original Indemnitor) represents and warrants to Lender as follows:

(a) Such Original Indemnitor is a limited partnership duly organized, validly existing and in good standing under the laws of the State of Delaware, and is authorized to execute this Agreement.

(b) This Agreement constitutes the legal, valid and binding obligations of such Original Indemnitor enforceable in accordance with its terms, except as enforceability hereof may be limited by bankruptcy, insolvency or other similar laws of general application affecting the enforcement of creditors’ rights or general equitable principals, whether applied in law or equity. Neither the entry into nor the performance of and compliance with this Agreement has resulted or will result in any violation of, or a conflict with or a default under, any judgment, decree, order, mortgage, indenture, contract, agreement or lease by which such Original Indemnitor or any property of such Original Indemnitor is bound, or any statute, rule or regulation applicable to Borrower.

(c) No representation or warranty of such Original Indemnitor made in this Agreement contains any untrue statement of material fact or omits to state a material fact necessary in order to make such representations and warranties not misleading in light of the circumstances under which they are made.

19. No Further Consents. Borrower and Assignee acknowledge and agree that Lender’s consent herein contained is expressly limited to the Transfer and Substitution as herein described, that such consents shall not waive or render unnecessary Lender’s consent or approval of any subsequent sale, conveyance, assignment or transfer of the Property or any interest therein, or any future substitution of indemnitor, except as may be specifically permitted in the Loan Documents, as modified hereby, and Borrower, Assignee and Lender acknowledge and agree that Article 8 of the Mortgage, as modified hereby, shall continue in full force and effect.

20. Incorporation of Recitals. Each of the Recitals set forth above in this Agreement are incorporated herein and made a part hereof.

21. Property Remains as Security for Lender. All of the Property as described and defined in the Mortgage shall remain in all respects subject to the lien, charge or encumbrance of the Mortgage, and nothing herein contained and nothing done pursuant hereto shall affect or be construed to release or affect the liability of any party or parties who may now or hereafter be liable under or on account of the Note or the Mortgage, nor shall anything herein contained or done in pursuance hereof affect or be construed to affect any other security for the Note, if any, held by Lender.

22. No Waiver by Lender. Nothing contained herein shall be deemed a waiver of any of Lender’s rights or remedies under any loan agreement, the Note, the Mortgage, the Loan Documents or applicable law, except as expressly provided herein.

23. Captions. The headings to the Sections of this Agreement have been inserted for convenience of reference only and shall in no way modify or restrict any provisions hereof or be used to construe any such provisions.

24. Partial Invalidity. If any provision of this Agreement is held to be illegal, invalid or unenforceable under present or future laws, such provision shall be fully severable, and this Agreement shall be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a part of this Agreement.

25. Entire Agreement. This Agreement and the documents contemplated to be executed herewith constitutes the entire agreement among the parties hereto with respect to the Transfer and Substitution and shall not be amended unless such amendment is in writing and executed by each of the parties. This Agreement supersedes all prior negotiations regarding the subject matter hereof. This Agreement may not be amended, revised, waived, discharged, released or terminated orally, but only by a written instrument or instruments executed by the party against which enforcement of the amendment, revision, waiver, discharge, release or termination is asserted. Any alleged amendment, revision, waiver, discharge, release or termination which is not so documented shall not be effective as to any party.

26. Binding Effect. This Agreement and the documents contemplated to be executed in connection herewith shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns; provided, however, that the foregoing provisions of this Section shall not be deemed to be a consent by Lender to any further sale, conveyance, assignment or transfer of the Property or any interest therein, except as may be specifically permitted in the Loan Documents, as modified hereby.

27. Multiple Counterparts. This Agreement may be executed in multiple counterparts, each of which will be an original, but all of which, taken together, will constitute one and the same Agreement.

28. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State where the Property is located.

29. Effective Date. This Agreement shall be effective as of the date of its execution and delivery by the parties hereto and thereupon is incorporated into the terms of the Loan Documents, and shall modify the Loan Documents as expressly provided herein.

30. Time of Essence. Time is of the essence with respect to all provisions of this Agreement.

31. Cumulative Remedies. All remedies contained in this Agreement are cumulative and Lender shall also have all other remedies provided at law and in equity or in the Mortgage and the other Loan Documents, as modified hereby. Such remedies may be pursued separately, successively or concurrently at the sole subjective direction of Lender and may be exercised in any order and as often as occasion therefor shall arise.

32. Construction. Each party hereto acknowledges that it has participated in the negotiation of this Agreement and that no provision shall be construed against or interpreted to the disadvantage of any party. Each of the parties has had sufficient time to review this Agreement, have been represented by legal counsel at all times, have entered into this Agreement voluntarily and without fraud, duress, undue influence or coercion of any kind. No representations or warranties have been made by Lender to any party except as set forth in this Agreement.

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement to be effective as of the date first aforesaid.


BORROWER:

GLENBOROUGH TIERRASANTA, LLC, a Delaware limited liability company

By:	▇▇▇▇▇▇ Pacific Properties, L.P., a Maryland limited partnership, its Sole Equity Member

	By:	▇▇▇▇▇▇ Pacific Properties, Inc., a Maryland corporation, its General Partner

		By:	/s/ ▇▇▇▇ ▇. Lammas
		Name:	▇▇▇▇ ▇. Lammas
		Title:	Chief Financial Officer

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[Signature Page to Tierrasanta Reaffirmation Agreement]

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