GUARANTY
TO: The Prudential Insurance Company of America
Four Embarcadero Center
Suite 2700
San Francisco, California 94111
The undersigned, ___________________, a _______________ ("Guarantor"), is
a limited partner in Mission West Properties L.P. [ __________ ], a Delaware
limited partnership (the "Partnership"), which is a joint and several obligor
with respect to a $130,000,000 loan from The Prudential Insurance Company of
America, a New Jersey corporation ("Lender"), pursuant to which the Partnership
on September 22, 1998 has executed and delivered a promissory note (the "Note")
in the original principal amount of One Hundred Thirty Million Dollars
($130,000,000) and a Deed of Trust, Security Agreement and Fixture Filing with
Assignment of Rents and Proceeds (the "Deed of Trust"). The Note is secured and
cross-collateralized by certain properties of the Partnership and three
affiliated limited partnerships whose sole general partner is Mission West
Properties, a California corporation, pursuant to the terms of the Deed of
Trust. Loan proceeds of $________________ have been allocated to the Partnership
under the loan terms (the "Partnership Principal") which are substantially less
than the value of the properties of the Partnership secured by the Deed of
Trust.
Generally the terms of the Note and Deed of Trust provide that no partner
in the Partnership shall have any personal liability with respect to the Note
except as provided in Paragraphs 18(b) and (c) of the Note or as provided in
this Guaranty when executed and delivered by a limited partner to Lender.
Guarantor is providing this Guaranty in connection with the loan pursuant to
Paragraph 18(b)(i) of the Note.
1. ACKNOWLEDGMENT. Guarantor hereby acknowledges that the Partnership has
obtained the aforementioned loan from Lender; and that the Partnership has
executed and delivered the Note and Deed of Trust to Lender; and Guarantor
hereby affirms and approves the same.
2. AMOUNT OF GUARANTY. Guarantor shall be obligated to pay Lender pursuant
to this Guaranty no more than that amount of the original principal of the Note
which is provided under this paragraph (the "Guaranteed Amount") together with
accrued and unpaid interest thereon. The initial Guaranteed Amount is
____________ _______________________ ($_____________). The Guaranteed Amount
shall be reduced simultaneously with each payment by the Partnership of original
principal under the terms of the Note by an amount equal to ________ percent
(__%) of each such payment, which is the same percentage as the Guaranteed
Amount bears to the total original principal amount of Partnership Principal
that has been guaranteed by limited partners of the Partnership. THIS GUARANTY
DOES NOT OBLIGATE THE GUARANTOR FOR ANY EXISTING OR CONTINGENT LIABILITY OR
OTHER OBLIGATION OF THE PARTNERSHIP UNDERTAKEN IN CONNECTION WITH THE NOTE OR
DEED OF TRUST EXCEPT FOR THE GUARANTEED AMOUNT.
3. CONDITIONS TO GUARANTY. Guarantor shall not be liable for any amount to
Lender pursuant to this Guaranty unless all of the following conditions have
been satisfied first: (a) there exists an event of default under the terms of
the Note or Deed of Trust, (b) Lender has accelerated the payment of the Note in
accordance with the terms of the Note and Deed of Trust, (c) Lender has made a
demand on the Partnership for payment of all amounts then due under the Note,
(d) the Partnership has failed or refused to satisfy all amounts then due under
the Note , (e) Lender has exercised all of its rights to the collateral of the
Partnership securing the Note and has disposed of such collateral in accordance
with the terms of the Note, Deed of Trust and other agreements respecting such
collateral, (f) there remains unpaid principal and interest on the Note after
Lender has exhausted its rights with respect to the collateral securing the Note
(including, but not limited to, after taking into account the amount of any
indebtedness owing under the Note applied toward Lender's purchase of any
property securing the Note pursuant to a judicial foreclosure, nonjudicial
foreclosure, or otherwise), (g) the Lender has exhausted all of its remedies and
recourse to all other assets of the Partnership, and (h) Lender has demanded
payment from Guarantor pursuant to written notice specifying the amount of
principal under the Note then subject to this Guaranty, which shall in no event
exceed the Guaranteed Amount, and delivered to Guarantor's address as set forth
in the records of the Partnership.
4. Guarantor hereby waives notice of acceptance hereof, of any action
taken or omitted in reliance hereon, and of any defaults of the Partnership in
the payment of any such sums or in the performance of any such covenants and
agreements. Guarantor hereby agrees that none of the following shall in any
manner release, affect or impair its liability under this Guaranty or require
its consent thereto: (a) any amendment or modification of the Note or Deed of
Trust issued thereunder, including the renewal or extension of any of the Note,
(b) any failure to realize proceeds from the sale of any property securing the
Note provided that any such sale is effected in accordance with the terms of the
agreements regarding Lender's security interest in such property.
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GUARANTY SIGNATURE PAGE
5. This Guaranty shall be governed by the laws of the State of California
without regard to principles concerning the conflict of laws.
IN WITNESS WHEREOF, the undersigned has executed this Guaranty as of
September __, 1998.
GUARANTOR
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[Type or print name]
By: [ _______________________________
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