Construction Facility Credit Agreement

EXECUTION COPY


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PUBLISHED CUSIP NUMBER: [_______________________]


CONSTRUCTION FACILITY
CREDIT AGREEMENT


Dated as of March 7, 2006


among


COUSINS PROPERTIES INCORPORATED
as the Borrower,


THE CONSOLIDATED ENTITIES OF THE BORROWER
FROM TIME TO TIME PARTY HERETO
as the Guarantors


BANK OF AMERICA, N.A.,
as Administrative Agent,


BANC OF AMERICA SECURITIES LLC
as Sole Lead Arranger and Sole Book Manager,


COMMERZBANK AG, NEW YORK BRANCH,
as Syndication Agent,


PNC BANK, NATIONAL ASSOCIATION AND WELLS FARGO BANK,
as Documentation Agents,


WACHOVIA BANK, NATIONAL ASSOCIATION,
as Managing Agent
and


THE OTHER LENDERS PARTY HERETO


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TABLE OF CONTENTS


Section Page - ------- ---- ARTICLE I DEFINITIONS AND ACCOUNTING TERMS..................................... 1
1.01 Defined Terms....................................................... 1
1.02 Other Interpretive Provisions....................................... 26
1.03 Accounting Terms.................................................... 27
1.04 Rounding............................................................ 27
1.05 References to Agreements and Laws................................... 28
1.06 Times of Day........................................................ 28


ARTICLE II THE COMMITMENTS AND CREDIT EXTENSIONS............................... 28
2.01 Loans............................................................... 28
2.02 Borrowings, Conversions and Continuations of Loans.................. 28
2.03 Intentionally Omitted............................................... 30
2.04 Intentionally Omitted............................................... 30
2.05 Prepayments......................................................... 30
2.06 Termination or Reduction of Commitments............................. 31
2.07 Repayment of Loans.................................................. 32
2.08 Interest............................................................ 32
2.09 Fees................................................................ 33
2.10 Computation of Interest and Fees.................................... 33
2.11 Evidence of Debt.................................................... 34
2.12 Payments Generally.................................................. 34
2.13 Sharing of Payments................................................. 36
2.14 Maturity Date....................................................... 36


ARTICLE III TAXES, YIELD PROTECTION AND ILLEGALITY............................. 37
3.01 Taxes............................................................... 37
3.02 Illegality.......................................................... 38
3.03 Inability to Determine Rates........................................ 38
3.04 Increased Cost; Reduced Return; Capital Adequacy; Reserves.......... 39
3.05 Compensation for Losses............................................. 39
3.06 Matters Applicable to all Requests for Compensation................. 40
3.07 Survival............................................................ 40


ARTICLE IV CONDITIONS PRECEDENT TO CREDIT EXTENSIONS........................... 41
4.01 Conditions of Initial Borrowing..................................... 41
4.02 Conditions to all Borrowings........................................ 43


ARTICLE V REPRESENTATIONS AND WARRANTIES....................................... 43
5.01 Existence, Qualification and Power; Compliance with Laws............ 44
5.02 Authorization; No Contravention..................................... 44
5.03 Governmental Authorization; Other Consents.......................... 44
5.04 Binding Effect...................................................... 44


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5.05 Financial Statements; No Material Adverse Effect.................... 44
5.06 Litigation.......................................................... 45
5.07 No Default.......................................................... 45
5.08 Ownership of Property; Liens........................................ 46
5.09 Environmental Compliance............................................ 46
5.10 Insurance........................................................... 46
5.11 Taxes............................................................... 46
5.12 ERISA Compliance.................................................... 46
5.13 Consolidated Entities; REIT Status.................................. 47
5.14 Margin Regulations; Investment Company Act; Public Utility Holding
Company Act......................................................... 47
5.15 Disclosure.......................................................... 47
5.16 Compliance with Laws................................................ 48
5.17 Intellectual Property; Licenses, Etc................................ 48
5.18 Compliance with Zoning and Other Requirements....................... 48
5.19 Plans and Specifications............................................ 49
5.20 Utilities........................................................... 49
5.21 Taxpayer Identification Number...................................... 49


ARTICLE VI AFFIRMATIVE COVENANTS............................................... 49
6.01 Financial Statements................................................ 49
6.02 Certificates; Other Information..................................... 50
6.03 Notices............................................................. 52
6.04 Payment of Obligations.............................................. 52
6.05 Preservation of Existence, Etc...................................... 53
6.06 Maintenance of Properties........................................... 53
6.07 Maintenance of Insurance............................................ 53
6.08 Compliance with Laws................................................ 53
6.09 Books and Records................................................... 54
6.10 Inspection Rights................................................... 54
6.11 Use of Proceeds; Incurrence of Borrowings........................... 54
6.12 Additional Guarantors............................................... 54


ARTICLE VII NEGATIVE COVENANTS................................................. 55
7.01 Liens............................................................... 55
7.02 Investments......................................................... 56
7.03 Indebtedness........................................................ 56
7.04 Fundamental Changes................................................. 57
7.05 Dispositions........................................................ 57
7.06 Restricted Payments................................................. 58
7.07 Intentionally Omitted............................................... 59
7.08 Transactions with Affiliates........................................ 59
7.09 Intentionally Omitted............................................... 59
7.10 Use of Proceeds..................................................... 59
7.11 Financial Covenants................................................. 59
7.12 Prepayment of Other Indebtedness, Etc............................... 60
7.13 Organization Documents; Subsidiaries................................ 60


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7.14 Covenants in Revolving Credit Agreement Incorporated by Reference... 60


ARTICLE VIII EVENTS OF DEFAULT AND REMEDIES.................................... 60
8.01 Events of Default................................................... 60
8.02 Remedies Upon Event of Default...................................... 63
8.03 Application of Funds................................................ 64


ARTICLE IX ADMINISTRATIVE AGENT................................................ 64
9.01 Appointment and Authorization of Administrative Agent............... 64
9.02 Delegation of Duties................................................ 65
9.03 Liability of Administrative Agent................................... 65
9.04 Reliance by Administrative Agent.................................... 65
9.05 Notice of Default................................................... 66
9.06 Credit Decision; Disclosure of Information by Administrative Agent.. 66
9.07 Indemnification of Administrative Agent............................. 67
9.08 Administrative Agent in its Individual Capacity..................... 67
9.09 Successor Administrative Agent...................................... 67
9.10 Administrative Agent May File Proofs of Claim....................... 68
9.11 Guaranty Matters.................................................... 69
9.12 Other Agents; Arrangers and Managers................................ 69


ARTICLE X MISCELLANEOUS........................................................ 70
10.01 Amendments, Etc..................................................... 70
10.02 Notices and Other Communications; Facsimile Copies.................. 71
10.03 No Waiver; Cumulative Remedies...................................... 73
10.04 Attorney Costs, Expenses and Taxes.................................. 73
10.05 Indemnification by the Borrower..................................... 73
10.06 Payments Set Aside.................................................. 74
10.07 Successors and Assigns.............................................. 74
10.08 Confidentiality..................................................... 78
10.09 Set-off............................................................. 79
10.10 Interest Rate Limitation............................................ 80
10.11 Counterparts........................................................ 80
10.12 Integration......................................................... 80
10.13 Survival of Representations and Warranties.......................... 80
10.14 Severability........................................................ 81
10.15 Tax Forms........................................................... 81
10.16 Replacement of Lenders.............................................. 83
10.17 Governing Law....................................................... 83
10.18 Waiver of Right to Trial by Jury.................................... 83
10.19 No Advisory or Fiduciary Responsibility............................. 84
10.20 USA PATRIOT Act Notice.............................................. 85
10.21 Attorneys' Fees..................................................... 85


ARTICLE XI GUARANTY............................................................ 85
11.01 The Guaranty........................................................ 85
11.02 Obligations Unconditional........................................... 86


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11.03 Reinstatement....................................................... 87
11.04 Certain Additional Waivers.......................................... 87
11.05 Remedies............................................................ 87
11.06 Rights of Contribution.............................................. 87
11.07 Guarantee of Payment; Continuing Guarantee.......................... 88


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SCHEDULES


1.1 Investment Entities 2.01 Commitments and Pro Rata Shares 5.05 Supplement to Interim Financial Statements 5.06 Litigation 5.09 Environmental Matters 5.12 ERISA Matters 5.13 Consolidated Entities and Other Equity Investments 5.17 Intellectual Property Matters 10.02 Administrative Agent's Office, Certain Addresses for Notices 10.07 Processing and Recordation Fees


EXHIBITS


A Form of Loan Notice B Form of Note C Form of Compliance Certificate D Form of Assignment and Assumption E Form of Joinder Agreement


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CONSTRUCTION FACILITY CREDIT AGREEMENT


This CONSTRUCTION FACILITY CREDIT AGREEMENT ("Agreement") is entered into as of March 7, 2006, among COUSINS PROPERTIES INCORPORATED, a Georgia corporation (the "Borrower"), the Guarantors (as defined herein), each lender from time to time party hereto (collectively, the "Lenders" and individually, a "Lender"), BANK OF AMERICA, N.A., as Administrative Agent, BANC OF AMERICA SECURITIES LLC, as Sole Lead Arranger and Sole Book Manager, COMMERZBANK AG, NEW YORK BRANCH, as Syndication Agent, PNC BANK, NATIONAL ASSOCIATION and WELLS FARGO BANK, as Documentation Agents, WACHOVIA BANK, NATIONAL ASSOCIATION, as Managing Agent.


The Borrower has requested that the Lenders provide a revolving credit facility for the purpose of providing a portion of the financing with respect to the costs and expenses associated with the construction of the Terminus Project (as defined herein), and the Lenders are willing to do so on the terms and conditions set forth herein.


In consideration of the mutual covenants and agreements herein contained, the parties hereto covenant and agree as follows:


ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS


1.01 DEFINED TERMS. As used in this Agreement, the following terms shall have the meanings set forth below:


"Adjusted Consolidated EBITDA" means, for any period, an amount equal to (a) Consolidated EBITDA for such period, less (b) a deemed capital expenditures reserve deduction equal to, on an annual basis, (i) $0.35 per rentable square foot of all Income Producing Assets (or any portion thereof) which constitutes office space; (ii) $0.15 per rentable square foot of all Income Producing Assets (or any portion thereof) which constitutes retail space and (iii) $0.15 per rentable square foot of all Income Producing Assets (or any portion thereof) which constitutes industrial space.


"Adjusted Unencumbered EBITDA" means, for any period, that portion of Adjusted Consolidated EBITDA for such period generated by Unencumbered Properties (following deductions for deemed capital expenditure reserves applicable to such Unencumbered Properties as set forth in the definition of Adjusted Consolidated EBITDA).


"Administrative Agent" or "Agent" means Bank of America in its capacity as administrative agent under any of the Loan Documents, or any successor administrative agent.


"Administrative Agent's Office" means the Administrative Agent's address and, as appropriate, account as set forth on Schedule 10.02, or such other address or account as the Administrative Agent may from time to time notify the Borrower and the Lenders.


"Administrative Questionnaire" means an Administrative Questionnaire in a form supplied by the Administrative Agent.


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"Affiliate" means, with respect to any Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified. "Control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. "Controlling" and "Controlled" have meanings correlative thereto. Without limiting the generality of the foregoing, a Person shall be deemed to be Controlled by another Person if such other Person possesses, directly or indirectly, power to vote 10% or more of the securities having ordinary voting power for the election of directors, managing general partners or the equivalent.


"Agent-Related Persons" means the Administrative Agent, together with its Affiliates (including, in the case of Bank of America in its capacity as the Administrative Agent, the Arranger), and the officers, directors, employees, agents and attorneys-in-fact of such Persons and Affiliates.


"Aggregate Commitments" means the aggregate Commitments of all the Lenders. The Aggregate Commitments as of the Closing Date shall be $100,000,000.


"Agreement" means this Construction Facility Credit Agreement.


"Applicable Capitalization Rate" means (i) 8.50% for Income Producing Assets primarily constituting office space; (ii) 8.25% for Income Producing Assets primarily constituting retail space and (iii) 8.00% for Income Producing Assets primarily constituting industrial space.


"Applicable Rate" means, from time to time, for the purposes of calculating (a) the interest rate applicable to Eurodollar Rate Loans for the purposes of Section 2.08 or (b) the interest rate applicable to Base Rate Loans for the purposes of Section 2.08, the following percentages per annum, based upon the Consolidated Leverage Ratio as set forth in the most recent Compliance Certificate received by the Administrative Agent pursuant to Section 6.02(b):


Applicable Rate


Pricing Level Consolidated Leverage Ratio Eurodollar Rate Loans Base Rate Loans - ------------- --------------------------- --------------------- --------------- 1 > or = 0.35:1 0.80% 0% 2 > 0.35:1 but 0.45:1 but 0.50:1 but 0.55:1 1.30% 0%


Any increase or decrease in the Applicable Rate resulting from a change in the Consolidated Leverage Ratio shall become effective as of the first Business Day immediately following the date a Compliance Certificate is delivered pursuant to Section 6.02(b); provided, however, that if a Compliance Certificate is not delivered when due in accordance with such Section, then


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Pricing Level 5 shall apply as of the first Business Day after the date on which such Compliance Certificate was required to have been delivered (until such time as such delinquent Compliance Certificate is delivered). The Applicable Rate on the Closing Date shall be Pricing Level 1.


"Approved Fund" has the meaning specified in Section 10.07(h).


"Arranger" means a collective reference to Banc of America Securities LLC in its capacity as sole lead arranger and sole book manager.


"Assignee Group" means two or more Eligible Assignees that are Affiliates of one another or two or more Approved Funds managed by the same investment advisor.


"Assignment and Assumption" means an Assignment and Assumption substantially in the form of Exhibit D.


"Attorney Costs" means and includes all reasonable fees, expenses and disbursements of any law firm or other external counsel.


"Attributable Indebtedness" means, on any date, (a) in respect of any capital lease of any Person, the capitalized amount thereof that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP, and (b) in respect of any Synthetic Lease Obligation, the capitalized amount of the remaining lease payments under the relevant lease that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP if such lease were accounted for as a capital lease. Notwithstanding the foregoing, Attributable Indebtedness shall not include the Attributable Indebtedness of Investment Entities except to the extent any other Unconsolidated Entity or Consolidated Entity is liable for the same (disregarding any liability with respect to customary recourse carve-outs applicable to any non-recourse secured Attributable Indebtedness and disregarding any general partnership liability of the Designated Entities).


"Audited Financial Statements" means the audited consolidated balance sheets of the Borrower and the Consolidated Entities for the calendar year ended December 31, 2004, and the related consolidated statements of income or operations, shareholders' equity and cash flows for such calendar year of such Persons, including the notes thereto.


"Availability Period" means the period from and including the Closing Date to the earliest of (a) the Maturity Date, (b) the date of termination of the Aggregate Commitments pursuant to Section 2.06, and (c) the date of termination of the Commitment of each Lender to make Loans pursuant to the terms hereof.


"Bank of America" means Bank of America, N.A. and its successors.


"Bankruptcy Code" means the Bankruptcy Code in Title 11 of the United States Code, as amended, modified, succeeded or replaced from time to time.


"Base Rate" means for any day a fluctuating rate per annum equal to the higher of (a) the Federal Funds Rate plus 1/2 of 1% and (b) the rate of interest in effect for such day as publicly announced from time to time by the Administrative Agent as its "prime rate." The "prime rate"


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is a rate set by the Administrative Agent based upon various factors including the Administrative Agent's costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above, or below such announced rate. Any change in such rate announced by the Administrative Agent shall take effect at the opening of business on the day specified in the public announcement of such change.


"Base Rate Loan" means a Loan that bears interest based on the Base Rate.


"Borrower" has the meaning specified in the introductory paragraph hereto.


"Borrower Materials" has the meaning specified in Section 6.02.


"Borrowing" means a borrowing consisting of simultaneous Loans of the same Type and, in the case of Eurodollar Rate Loans, having the same Interest Period made by each of the Lenders pursuant to Section 2.01.


"Business Day" means any day other than a Saturday, Sunday or other day on which commercial banks are authorized to close under the Laws of, or are in fact closed in, the state where the Administrative Agent's Office is located and, if such day relates to any Eurodollar Rate Loan, means any such day on which dealings in Dollar deposits are conducted by and between banks in the London interbank eurodollar market.


"Capital Lease Obligations" means, as to any Person, the obligations of such Person under a lease that are required to be classified and accounted for as capital lease obligations under GAAP and, for purposes of this definition, the amount of such obligations at any date shall be the capitalized amount of such obligations at such date, determined in accordance with GAAP.


"Capital Stock" means any and all shares, interests or other equivalents (however designated) of capital stock of a corporation, any and all equivalent equity ownership interests in a Person that is not a corporation, including, without limitation, any and all member or other equivalent interests in any limited liability company or partnership interests or other equivalents in any kind of partnership, and any and all warrants or options to purchase any of the foregoing.


"Cash Equivalents" means, as at any date, (a) securities issued or directly and fully guaranteed or insured by the United States or any agency or instrumentality thereof (provided that the full faith and credit of the United States is pledged in support thereof) having maturities of not more than ninety (90) days from the date of acquisition, (b) Dollar denominated time deposits and certificates of deposit of (i) any Lender, (ii) any domestic commercial bank of recognized standing having capital and surplus in excess of $500,000,000 or (iii) any bank whose short-term commercial paper rating from S&P is at least A-1 or the equivalent thereof or from Moody's is at least P-1 or the equivalent thereof (any such bank being an "Approved Bank"), in each case with maturities of not more than ninety (90) days from the date of acquisition, (c) commercial paper and variable or fixed rate notes issued by any Approved Bank (or by the parent company thereof) or any variable rate notes issued by, or guaranteed by, any domestic corporation rated A-1 (or the equivalent thereof) or better by S&P or P-1 (or the equivalent thereof) or better by Moody's and maturing within ninety (90) days of the date of acquisition and (d) Investments, classified in accordance with GAAP as current assets, in money market


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investment programs registered under the Investment Company Act of 1940, as amended, which are administered by reputable financial institutions having capital of at least $500,000,000 and the portfolios of which are limited to Investments of the character described in the foregoing subdivisions (a) through (d).


"Change of Control" means, with respect to any Person, an event or series of events by which:


(a) any "person" or "group" (as such terms are used in Sections 13(d)
and 14(d) of the Securities Exchange Act of 1934, but excluding any
employee benefit plan of such person or its subsidiaries, and any person or
entity acting in its capacity as trustee, agent or other fiduciary or
administrator of any such plan) becomes the "beneficial owner" (as defined
in Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, except
that a person or group shall be deemed to have "beneficial ownership" of
all securities that such person or group has the right to acquire which are
granted by such Person (such right, an "option right"), whether such right
is exercisable immediately or only after the passage of time), directly or
indirectly, of 25% (or, in the case of Tom Cousins, 40%) or more of the
equity securities of such Person entitled to vote for members of the board
of directors or equivalent governing body of such Person on a fully-diluted
basis (and taking into account all such securities that such person or
group has the right to acquire pursuant to any option right granted by such
Person); or


(b) during any period of 12 consecutive months, a majority of ...