Exhibit 10.69
 

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Acadia Strategic Opportunity Fund III LLC,
a Delaware limited liability company
As Borrower

Acadia Realty Acquisition III LLC,
a Delaware limited liability company
As Managing Member

Acadia Realty Limited Partnership,
a Delaware limited partnership
As Guarantor

Acadia Investors III, Inc.,
a Maryland corporation
As Pledgor

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Revolving Credit Agreement
 

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Bank of America, N.A.
As Administrative Agent
 
Banc of America Securities LLC
As Sole Lead Arranger and Sole Book Manager
 
YC Susi Trust,
As Conduit Lender
 
Bank of America, N.A.
As an Administrator, Alternate Lender and Managing Agent
and
The Other Conduit Lenders, Administrators,
Alternate Lenders and Managing Agents
From Time to Time Party Hereto
 

 
October 10, 2007
 
 

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TABLE OF CONTENTS
 

     
Page
       
1.
DEFINITIONS
1
 
1.1.
Defined Terms
1
 
1.2.
Other Definitional Provisions
28
 
1.3.
Letter of Credit Amounts
29
2.
LOANS AND LETTERS OF CREDIT
29
 
2.1.
The Commitment
29
 
2.2.
Revolving Credit Commitment
32
 
2.3.
Borrowing Procedures
32
 
2.4.
Determination of Yield and Interest Periods
36
 
2.5.
Letters of Credit
36
 
2.6.
Payment of Borrower Guaranty
45
 
2.7.
Use of Proceeds and Letters of Credit
46
 
2.8.
Administrative Agent and Arranger Fees
46
 
2.9.
Unused Facility Fee
46
 
2.10.
Letter of Credit Fees
46
 
2.11.
Computation of Interest and Fees
46
 
2.12.
Increase in the Facility Amount
47
3.
PAYMENT OF OBLIGATIONS
47
 
3.1.
Notes
47
 
3.2.
Payment of Obligations
48
 
3.3.
Payment of Interest
48
 
3.4.
Payments Generally
49
 
3.5.
Voluntary Prepayments
50
 
3.6.
Reduction or Early Termination of Commitments
51
 
3.7.
Lending Office
51
4.
CHANGE IN CIRCUMSTANCES
52
 
4.1.
Taxes
52
 
4.2.
Illegality
53
 
4.3.
Inability to Determine Rates
53
 
4.4.
Increased Cost and Capital Adequacy
54

 
 
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TABLE OF CONTENTS
(continued)
 

       Page          
4.5.
Funding Losses
55
 
4.6.
Matters Applicable to all Requests for Compensation
55
 
4.7.
Prohibited Event
56
5.
SECURITY
56
 
5.1.
Liens and Security Interest
56
 
5.2.
Collateral Account; Capital Calls
57
 
5.3.
Agreement to Deliver Additional Collateral Documents
59
 
5.4.
Subordination of All Credit Party Claims
60
6.
[RESERVED]
61
7.
ADDITIONAL ALTERNATE LENDER PROVISIONS
61
 
7.1.
Assignment to Alternate Lenders
61
 
7.2.
Downgrade of Alternate Lender
62
8.
CONDITIONS PRECEDENT TO LENDING
65
 
8.1.
Obligation of Lenders
65
 
8.2.
Qualified Borrower Loans and Letters of Credit
68
 
8.3.
All Loans and Letters of Credit
69
9.
REPRESENTATIONS AND WARRANTIES
69
 
9.1.
Organization and Good Standing of Borrower
69
 
9.2.
Organization and Good Standing of Managing Member
69
 
9.3.
Organization and Good Standing of Guarantor
70
 
9.4.
Organization and Good Standing of Pledgor
70
 
9.5.
Authorization and Power
70
 
9.6.
No Conflicts or Consents
70
 
9.7.
Enforceable Obligations
70
 
9.8.
Priority of Liens
70
 
9.9.
Financial Condition
71
 
9.10.
Full Disclosure
71
 
9.11.
No Default
71
 
9.12.
No Litigation
71
 
9.13.
Material Adverse Change
71

 
 
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TABLE OF CONTENTS
(continued)
 

       Page          
9.14.
Taxes
71
 
9.15.
Jurisdiction of Formation; Principal Office
71
 
9.16.
ERISA Compliance
72
 
9.17.
Compliance with Law
72
 
9.18.
Hazardous Substances
72
 
9.19.
Insider
72
 
9.20.
Properties
72
 
9.21.
Operating Structure
72
 
9.22.
Capital Commitments and Contributions
73
 
9.23.
Fiscal Year
73
 
9.24.
Investment Company Act
73
 
9.25.
Margin Stock
73
 
9.26.
Foreign Asset Control Laws
73
 
9.27.
Brokers’ Fees
73
 
9.28.
Solvency
73
 
9.29.
Managing Member Representation
73
 
9.30.
Guarantor Representation
73
 
9.31.
Pledgor Representation
74
 
9.32.
Investments
74
 
9.33.
Investor Documents
74
 
9.34.
Advisory Committee
74
10.
AFFIRMATIVE COVENANTS
74
 
10.1.
Financial Statements, Reports and Notices
74
 
10.2.
Payment of Taxes
76
 
10.3.
Maintenance of Existence and Rights
76
 
10.4.
Notice of Default
76
 
10.5.
Other Notices
76
 
10.6.
Compliance with Loan Documents, Operating Agreement, Partnership Agreement and
Stockholders Agreement
77
 
10.7.
Books and Records; Access
77

 
 
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TABLE OF CONTENTS
(continued)
 

       Page          
10.8.
Compliance with Law
77
 
10.9.
Insurance
77
 
10.10.
Authorizations and Approvals
77
 
10.11.
Maintenance of Liens
77
 
10.12.
Further Assurances
78
 
10.13.
Investor Financial and Rating Information
78
 
10.14.
Certain Included Investor Requirements
78
 
10.15.
Covenants of Qualified Borrowers
78
11.
NEGATIVE COVENANTS
78
 
11.1.
Mergers
79
 
11.2.
Negative Pledge
79
 
11.3.
Fiscal Year and Accounting Method
79
 
11.4.
Constituent Documents
79
 
11.5.
Transfer by, or Admission of, Investors
80
 
11.6.
Capital Commitments
80
 
11.7.
ERISA Compliance
81
 
11.8.
Environmental Matters
81
 
11.9.
Dissolution
81
 
11.10.
Limitations on Dividends and Distributions
81
 
11.11.
Limitation on Debt
81
 
11.12.
Limitation on Managing Member’s Activities
81
 
11.13.
Limitation on Pledgor’s Activities
81
 
11.14.
Limitation on Guarantor’s Activities
82
 
11.15.
Investor Withdrawal
82
12.
EVENTS OF DEFAULT
82
 
12.1.
Events of Default
82
 
12.2.
Remedies Upon Event of Default
84
 
12.3.
Performance by Administrative Agent
85
13.
AGENCY PROVISIONS
85
 
13.1.
Appointment and Authorization of Agents
85

 
 
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TABLE OF CONTENTS
(continued)
 

       Page          
13.2.
Delegation of Duties
86
 
13.3.
Exculpatory Provisions
86
 
13.4.
Reliance on Communications
87
 
13.5.
Notice of Default
87
 
13.6.
Non-Reliance on Agents and Other Lenders
87
 
13.7.
Indemnification
88
 
13.8.
Agents in Their Individual Capacity
88
 
13.9.
Successor Agent
89
 
13.10.
No Other Duties, Etc
89
 
13.11.
Administrative Agent May File Proofs of Claim
89
14.
MISCELLANEOUS
90
 
14.1.
Amendments
90
 
14.2.
Setoff
92
 
14.3.
Sharing of Payments
92
 
14.4.
Payments Set Aside
93
 
14.5.
Waiver
93
 
14.6.
Payment of Expenses
94
 
14.7.
Notice
96
 
14.8.
GOVERNING LAW
97
 
14.9.
Choice of Forum; Consent to Service of Process and Jurisdiction; Waiver of Trial
by Jury
97
 
14.10.
Invalid Provisions
98
 
14.11.
Entirety and Amendments
98
 
14.12.
Successors and Assigns
98
 
14.13.
Lender Default
103
 
14.14.
Replacement of Lender
103
 
14.15.
Maximum Interest
103
 
14.16.
Headings
104
 
14.17.
Survival
104
 
14.18.
Integration
104

 
 
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TABLE OF CONTENTS
(continued)
 

       Page          
14.19.
Limited Liability of Investors
104
 
14.20.
Confidentiality
104
 
14.21.
USA PATRIOT Act Notice
105
 
14.22.
Multiple Counterparts
106
 
14.23.
No Bankruptcy Petition Against any Conduit Lender
106
 
14.24.
No Recourse Against any Conduit Lender
106

SCHEDULES
     
SCHEDULE 1.1
Commitments
SCHEDULE 14.7
Address and Account Information
SCHEDULE 14.12(b)
Processing & Recording Fees
   
EXHIBITS
     
EXHIBIT A:
Schedule of Investors and Commitments
EXHIBIT B-1:
Form of Note
EXHIBIT B-2:
Form of Qualified Borrower Note
EXHIBIT B-3:
Form of Qualified Borrower Letter of Credit Note
EXHIBIT C:
Form of Loan Notice
EXHIBIT D-1:
Form of Request for Letter of Credit
EXHIBIT D-2:
Form of Letter of Credit
EXHIBIT E:
Form of Borrower and Managing Member Security Agreement
EXHIBIT F:
Form of Account Assignment
EXHIBIT G:
Form of Facility Increase Request
EXHIBIT H:
Form of Borrowing Base Certificate
EXHIBIT I:
Form of Investor Letter
EXHIBIT J:
[Reserved]
EXHIBIT K:
[Reserved]
EXHIBIT L:
Form of Capital Contributions Pledge Agreement
EXHIBIT M:
Form of Assignment and Assumption Agreement
EXHIBIT N:
Form of Borrower Guaranty
EXHIBIT O:
Form of Compliance Certificate
EXHIBIT P:
Form of Guaranty of Capital

 
 
 
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REVOLVING CREDIT AGREEMENT
 
THIS REVOLVING CREDIT AGREEMENT (together with all amendments and modifications
hereof and supplements and attachments hereto, this “Credit Agreement”) is dated
as of October 10, 2007 by and among ACADIA STRATEGIC OPPORTUNITY FUND III LLC, a
Delaware limited liability company (the “Borrower”), ACADIA REALTY ACQUISITION
III LLC, a Delaware limited liability company (the “Managing Member”), ACADIA
REALTY LIMITED PARTNERSHIP, a Delaware limited partnership (the “Guarantor”)
ACADIA INVESTORS III, INC., a Maryland corporation (the “Pledgor”), YC SUSI
Trust, as Conduit Lender, BANK OF AMERICA, N.A., a national banking association
(in its individual capacity, “Bank of America”), as administrative agent
(together with any successor appointed pursuant to Section 13.9 below, the
“Administrative Agent”) for the Lenders, as an Alternate Lender, as an
Administrator and as a Managing Agent, and each of the other Persons from time
to time party hereto as Lenders, Managing Agents and Administrators (all such
terms, as hereinafter defined).
 
A.           Borrower, Managing Member, Guarantor and Pledgor have requested
that Lenders make loans and cause the issuance of letters of credit to Borrower
and Qualified Borrowers (as hereinafter defined) for the principal purposes of
providing working capital to the Borrower; financing the costs and other
expenses to be incurred by Borrower in connection with making investments
permitted under the Operating Agreement (as hereinafter defined); and financing
the costs of other undertakings by Borrower permitted under the Operating
Agreement; and
 
B.           Lenders are willing to lend funds and to cause the issuance of
letters of credit upon the terms and subject to the conditions set forth in this
Credit Agreement.
 
NOW, THEREFORE, in consideration of the mutual promises herein contained and for
other valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto do hereby agree as follows:
 
1. DEFINITIONS
 
1.1. Defined Terms.  For the purposes of this Credit Agreement, unless otherwise
expressly defined, the following terms shall have the respective meanings
assigned to them in this Section 1 or in the Section or recital referred to:
 
“Account Assignment” means that certain assignment of the Collateral Account
substantially in the form of Exhibit F, dated the date hereof, executed by
Borrower in favor of Administrative Agent for the benefit of the Secured
Parties.
 
“Adequately Capitalized” means in compliance with the capital standards for bank
holding companies as described in the Bank Holding Company Act of 1956, as
amended, and regulations promulgated thereunder.
 
“Administrative Agent” is defined in the first paragraph hereof.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
 

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“Administrative Agent’s Account” means the account designated from time to time
by the Administrative Agent for payments by the Borrower Parties pursuant to
this Credit Agreement.
 
“Administrative Agent’s Office” means Administrative Agent’s address set forth
on Schedule 14.7 or such other address as Administrative Agent may from time to
time notify the Borrower and the Lenders in writing.
 
“Administrator” means: (a) with respect to YC SUSI, Bank of America or an
Affiliate thereof; and (b) with respect to any other Conduit Lender, the Person
designated by such Conduit Lender as its “Administrator”, which Person becomes a
party to this Credit Agreement in such capacity.
 
“Affiliate” of any Person means any other Person that, directly or indirectly,
controls or is controlled by, or is under common control with, such Person.  For
the purpose of this definition, “control” and the correlative meanings of the
terms “controlled by” and “under common control with” means the possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of such Person, whether through the ownership of voting
shares or partnership interests or by contract or otherwise.
 
“Agent-Related Persons” means each 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 their respective Affiliates.
 
“Agents” means, collectively, Administrative Agent, Letter of Credit Issuer,
Administrators, Managing Agents, the Arranger and any successors and assigns in
such capacities.
 
“Alternate Lender Percentage” means, with respect to any Lender Group, at any
time, a fraction, expressed as a percentage, the numerator of which is the
portion of the Loans funded by the Alternate Lenders of such Lender Group and
the denominator of which is the aggregate Loans at such time of such Lender
Group; provided that at all times on and after the first Assignment Date
occurring on or after the Conduit Investment Termination Date for the Conduit
Lender related to such Lender Group, the Alternate Lender Percentage for such
Lender Group means 100%.
 
“Alternate Lender Pro Rata Share” means, with respect to each Alternate Lender
and any Lender Group, the percentage obtained from the fraction: (a) the
numerator of which is the Commitment of such Alternate Lender; and (b) the
denominator of which is the aggregate Commitments of all Alternate Lenders in
the related Lender Group.
 
“Alternate Lenders” means:  (a) for the YC SUSI Lender Group, Bank of America
and any assignees thereof that shall become party hereto pursuant to Section 7
or Section 14.12; and (b) for any other Lender Group, the “Alternate Lenders”
specified therefore who become parties hereto and any assignees thereof that
shall become party hereto pursuant to Section 7 or Section 14.12.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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“Alternate Rate” means, for any Interest Period for any Portion of Loans for any
Lender Group, an interest rate per annum as provided in the Fee Letter above the
LIBOR Rate for such Interest Period; provided, however, that in the case of:
 
(a)           any Interest Period of one to (and including) 14 days;
 
(b)           any Interest Period which commences prior to the related Managing
Agent receiving at least three (3) Business Days notice thereof; or
 
(c)           any Interest Period relating to a Portion of Loans which is less
than $5,000,000;
 
the “Alternate Rate” for each such Interest Period shall be an interest rate per
annum equal to the Base Rate in effect on each day of such Interest Period.  The
“Alternate Rate” for any date on or after the occurrence of an Event of Default
or the Maturity Date shall be the Default Rate.
 
“Applicable Margin” has the meaning provided in the Fee Letter.
 
“Applicable Requirement” means, for any Included Investor that is (or whose
Credit Provider, if applicable, is):  (a) a Bank Holding Company, Adequately
Capitalized status or better and a Rating of BBB/Baa2 or higher; (b) an
insurance company, a Best’s Rating of A- or higher and a Rating of BBB/Baa2 or
higher; (c) an ERISA Investor, or the trustee or nominee of an ERISA Investor,
in addition to the Sponsor’s Rating of BBB/Baa2 or higher, a minimum Funding
Ratio for the related pension fund based on the Rating of the Sponsor of the
related pension fund as follows:
 
Sponsor Rating
Minimum Funding Ratio
A-/A3 or higher
No minimum
BBB+/Baa1
90%
BBB/Baa2
95%

(d) a Governmental Plan Investor, or the Responsible Party with respect to such
Governmental Plan Investor, in addition to the Responsible Party’s Rating of
BBB/Baa2 or higher, a minimum Funding Ratio for the pension fund based on the
Rating of the Responsible Party as follows:
 
Responsible Party Rating
Minimum Funding Ratio
A-/A3 or higher
No minimum
BBB+/Baa1
90%
BBB/Baa2
95%;

 
and (e) otherwise a Rated Investor, a Rating of BBB/Baa2 or higher.
 
The first Rating indicated in each case above is the S&P Rating and the second
Rating indicated in each case above is the Moody’s Rating.  In the event that
the S&P and Moody’s Ratings are not equivalent, then the Applicable Requirement
shall be based on the lower of the two. If any such Person has only one Rating,
from either S&P or Moody’s, then that Rating shall apply.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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“Application and Agreement for Letter of Credit” means an application and
agreement for standby letter of credit by, between and among Borrower and a
Qualified Borrower, on the one hand, and the Letter of Credit Issuer, on the
other hand, in a form acceptable to the Letter of Credit Issuer (and customarily
used by it in similar circumstances) and conformed to the terms of this Credit
Agreement, either as originally executed or as it may from time to time be
supplemented, modified, amended, renewed, or extended, provided, however, to the
extent that the terms of such Application and Agreement are inconsistent with
the terms of this Credit Agreement, the terms of this Credit Agreement shall
control.
 
“Approved Fund” means any Person (other than a natural person) that is (or will
be) engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business,
that is administered or managed by: (a) a Lender; (b) an Affiliate of a Lender;
or (c) an entity or an Affiliate of an entity that administers or manages a
Lender.
 
“Arranger” is defined in the preamble to this Credit Agreement.
 
“Assignee” is defined in Section 14.12(b) hereof.
 
“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 Amount” means, with respect to an Alternate Lender at the time of
any assignment pursuant to Section 7.1 by any Conduit Lender in such Alternate
Lender’s Lender Group, an amount equal to the least of:  (a) such Alternate
Lender’s Alternate Lender Pro Rata Share of the Obligations requested by such
Conduit Lender to be assigned at such time; (b) such Alternate Lender’s unused
Commitment (minus the sum of (i) the unrecovered principal amount of such
Alternate Lender’s investments in such Obligations pursuant to the Program
Support Agreement to which it is a party and (ii) such Alternate Lender’s
Alternate Lender Pro Rata Share of the applicable Lender Group Percentage of the
Letter of Credit Liability); and (c) in the case of an assignment on or after
the Conduit Investment Termination Date for the Conduit Lender related to such
Lender Group, (i) such Alternate Lender’s Alternate Lender Pro Rata Share of the
applicable Conduit Lender Percentage of the Lender Group Percentage of the
Borrowing Base minus (ii) such Alternate Lender’s Alternate Lender Pro Rata
Share of the applicable Lender Group Percentage of the Letter of Credit
Liability.
 
“Assignment and Assumption Agreement” means the agreement contemplated by
Section 14.12(b)  hereof, pursuant to which any Lender assigns all or any
portion of its rights and obligations hereunder, which agreement shall be
substantially in the form of Exhibit M attached hereto.
 
“Assignment Date” is defined in Section 7.1(a) hereof.
 
“Assignment Fee” is defined in Schedule 14.12(b) hereto.
 
“Attorney Costs” means and includes all reasonable fees and disbursements of any
law firm or other external counsel and the allocated cost of internal legal
services and all disbursements of internal counsel.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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“Auto-Extension Letter of Credit” is defined in Section 2.5(b)(iii).
 
“Availability Period” means the period commencing on the Closing Date and ending
on the Maturity Date.
 
“Available Loan Amount” means, at any time, the lesser of (a) the Facility
Amount at such time; or (b) the Borrowing Base at such time.
 
“Bank Holding Company” means a “bank holding company” as defined in Section 2(a)
of the Bank Holding Company Act of 1956, as amended, or a non-bank subsidiary of
such bank holding company.
 
“Bank of America” is defined in the preamble to this Credit Agreement.
 
“Base Rate” means, for any day for any Portion of Loans for any Lender Group, a
fluctuating rate per annum equal to the higher of: (a) the Federal Funds Rate
for such day, plus the Applicable Margin; and (b) the rate of interest in effect
for such day as publicly announced from time to time by Bank of America as its
“prime rate”, plus the Applicable Margin.  The “prime rate” is a rate set by
Bank of America based upon various factors including Bank of America’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 Bank of America shall
take effect at the opening of business on the day specified in the public
announcement of such change.
 
“Best’s Rating” means a “Best’s Rating” by A.M. Best Company.
 
“Borrower” is defined in the preamble to this Credit Agreement.
 
“Borrower and Managing Member Security Agreement” means that certain Security
Agreement, substantially in the form of Exhibit E, executed and delivered by
Borrower and Managing Member in favor of Administrative Agent for the benefit of
Secured Parties.
 
“Borrower Guaranty” means an unconditional guaranty of payments in the form of
Exhibit N attached hereto, enforceable against Borrower for the payment of a
Qualified Borrower’s debt or obligation to Secured Parties; and “Borrower
Guaranties” means such guaranties, collectively.
 
“Borrower Parties” means Borrower and each Qualified Borrower; and “Borrower
Party” means any of them.
 
“Borrowing” means a disbursement made by Lenders with respect to Loans hereunder
(including any reimbursement of the Letter of Credit Issuer following a draw on
a Letter of Credit) and “Borrowings” means the plural thereof.
 
“Borrowing Base” means the sum of (a) ninety percent (90%) of the Eligible
Available Contributions of the Included Investors at such time; and (b)
sixty-five percent (65%) of the Eligible Available Contributions of the
Designated Investors at such time.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
5

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“Borrowing Base Certificate” means the certificate setting forth the calculation
of the Borrowing Base in the form of Exhibit H.
 
“Borrowing Base Deficit” means, on any date of determination, the amount (if
any) by which: (a) the Principal Obligation is in excess of (b) the Borrowing
Base.
 
“Business Day” means any day of the year except 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 of New York or the city of Charlotte, North Carolina.
 
“Capital Call” means a call upon all or any of the Investors for payment of all
or any portion of their Unfunded Capital Commitments pursuant to and in
accordance with the terms of the Stockholders Agreement, the Partnership
Agreement and/or the Operating Agreement, as applicable.
 
“Capital Call Notice” means any notice sent to an Investor for the purpose of
making a Capital Call.
 
“Capital Call Notice Date” is defined in Section 5.2(c) hereof.
 
“Capital Commitment” means the commitment of each Investor to fund Capital
Contributions, directly or indirectly, to a Credit Party in the amount set forth
in, and pursuant to the terms of, the Stockholders Agreement, the Partnership
Agreement and/or the Operating Agreement, as applicable.
 
“Capital Contribution” means for any Investor, any contribution of capital made
to Borrower or the Pledgor, as applicable, in response to a Capital Call Notice.
 
“Capital Contributions Pledge Agreement” means that certain Capital
Contributions Pledge Agreement, dated as of the date hereof executed and
delivered by Pledgor in favor of Administrative Agent on behalf of the Secured
Parties, as the same may be amended, supplemented or otherwise modified from
time to time with the consent of Administrative Agent, the Letter of Credit
Issuer, and the Lenders to the extent expressly required hereby, which agreement
shall be substantially in the form of Exhibit L attached hereto.
 
“Capital Lease” means, as applied to any Person, any lease of any property
(whether real, personal or mixed) by that Person as lessee which, in accordance
with GAAP, is or should be accounted for as a capital lease on the balance sheet
of that Person and the amount of such obligation shall be the capitalized amount
thereof determined in accordance with GAAP.
 
“Cash Collateralize” is defined in Section 2.5(g)(ii) hereof.
 
“CERCLIS” means the Comprehensive Environmental Response, Compensation and
Liability Information System.
 
“Change in Law” means the occurrence, after the date of this Credit Agreement,
of any of the following: (a) the adoption or taking effect of any law, rule,
regulation or treaty; (b) any change in any law, rule, regulation or treaty or
in the administration, interpretation or application thereof by any Governmental
Authority; or (c) the making or issuance of any request, guideline or directive
(whether or not having the force of law) by any Governmental Authority.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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“Closing Date” means the date on which all of the conditions precedent set forth
in Section 8.1 hereof are satisfied or waived.
 
“Code” means the Uniform Commercial Code as adopted in the State of New York and
any other state, which governs creation or perfection (and the effect thereof)
of security interests in any collateral for the Obligations.
 
“Collateral” is defined in Section 5.1(a) hereof.
 
“Collateral Account” is defined in Section 5.2(a).
 
“Collateral Documents” means the security agreements, financing statements,
assignments and other documents and instruments from time to time executed and
delivered pursuant to this Credit Agreement and any documents or instruments
amending or supplementing the same, including, without limitation, the Borrower
and Managing Member Security Agreement, the Capital Contributions Pledge
Agreement and the Account Assignment.
 
“Commercial Paper” means, with respect to a Conduit Lender, the promissory notes
issued or to be issued by such Conduit Lender (or its related commercial paper
issuer if such Conduit Lender does not itself issue commercial paper) in the
commercial paper market.
 
“Commitment” means, with respect to each Alternate Lender, as the context
requires, the commitment of such Alternate Lender to make Loans (including Loans
funding draws under Letters of Credit) and to pay Assignment Amounts in
accordance herewith in an amount not to exceed the amount set forth opposite
such Alternate Lender’s name on Schedule 1.1 hereof and the heading “Commitment”
(or, in the case of an Alternate Lender which becomes a party hereto pursuant to
an Assignment and Assumption Agreement entered into pursuant to the terms
hereof, as set forth in such Assignment and Assumption Agreement); minus the
amount of any Commitment or portion thereof assigned by such Alternate Lender
pursuant to an Assignment and Assumption Agreement entered into pursuant to the
terms hereof; plus the amount of any increase to such Alternate Lender’s
Commitment consented to by such Alternate Lender prior to the time of
determination; provided, however, that, to the extent that the Facility Amount
is reduced or otherwise declines, the aggregate of the Commitments of all the
Alternate Lenders shall decline by a like amount and the Commitment of each
Alternate Lender shall decline in proportion thereto.
 
“Compliance Certificate” is defined in Section 10.1(d).
 
“Concentration Limit” has the meaning provided in the definition of “Inclusion
Percentage”.
 
“Conduit Assignee” means any special purpose entity that finances its activities
directly or indirectly through asset backed commercial paper and is administered
by an Administrator or any of its Affiliates and designated by such
Administrator from time to time to accept an assignment from the applicable
Conduit Lender of all or a portion of its Loans and other interests hereunder.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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“Conduit Collateral Agent” means, with respect to any Conduit Lender, the
“Collateral Agent” (if any) with respect to such Conduit Lender’s commercial
paper program.
 
“Conduit Investment Termination Date” means, with respect to any Conduit Lender,
the date of the delivery by such Conduit Lender to the Borrower of written
notice that such Conduit Lender elects, in its sole discretion, not to make any
further Loans or participate in any further Letters of Credit hereunder.
 
“Conduit Lender” means:  (a) YC SUSI and any permitted Conduit Assignee thereof;
and (b) any other Person that shall become a party to this Credit Agreement as a
“Conduit Lender” pursuant to the terms hereof; and, subject to the terms and
conditions of this Credit Agreement, their respective successors and assigns
(but not any Participant who is not otherwise a party to this Credit Agreement).
 
“Conduit Lender Percentage” means, with respect to any Conduit Lender, at any
time, 100%, less the Alternate Lender Percentage of such Conduit Lender’s Lender
Group at such time.
 
“Constituent Documents” means, for any entity, its constituent or organizational
documents, including: (a) in the case of a limited partnership, its certificate
of registration as a limited partnership and its limited partnership agreement;
(b) in the case of a limited liability company, its certificate of formation or
organization and its operating agreement or limited liability company agreement;
(c) in the case of a corporation, its articles or certificate of incorporation
and its bylaws; and (d) in the case of a joint venture, trust or other form of
business entity, the partnership, joint venture or other applicable agreement of
formation and any agreement, instrument, filing or notice with respect thereto
filed in connection with its formation with the secretary of state or other
department in the state or jurisdiction of its formation, in each case as
amended from time to time.
 
“Controlled Group” means:  (a) the controlled group of corporations as defined
in Section 1563 of the Internal Revenue Code; or (b) the group of trades or
businesses under common control as defined in Section 414(c) of the Internal
Revenue Code, in each case of which any Borrower Party is a part or may become a
part.
 
“CP Rate” means, for any Interest Period for any Portion of Loans funded by a
Conduit Lender (or its related commercial paper issuer if such Conduit Lender
does not itself issue commercial paper) of a Lender Group by issuing Commercial
Paper, the per annum rate equivalent to the sum of (a) the Used Fee, (b) the
Dealer Fee, and (c) the weighted average cost (as determined by the applicable
Administrator and including incremental carrying costs incurred with respect to
Commercial Paper maturing on dates other than those on which corresponding funds
are received by such Conduit Lender, other borrowings by such Conduit Lender
(other than under any Program Support Agreement) and any other costs associated
with the issuance of Commercial Paper) of or related to the issuance of
Commercial Paper that are allocated, in whole or in part, by such Conduit Lender
or the applicable Administrator to fund or maintain such Portion of Loans (and
which may be also allocated in part to the funding of other assets of such
Conduit Lender); provided, however, that if any component of such rate is a
discount rate, in calculating the “CP Rate” for such Portion of Loans for such
Interest Period, such Conduit Lender shall for such component use the rate
resulting from converting such discount rate to an interest bearing equivalent
rate per annum.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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“Credit Agreement” is defined in the preamble hereto.
 
“Credit Parties” means Borrower, each Qualified Borrower, Managing Member,
Guarantor and Pledgor; “Credit Party” means any one of them.
 
“Credit Party Claims” is defined in Section 5.4 hereof.
 
“Credit Provider” means a Person providing a guaranty, in form and substance
reasonably acceptable to Administrative Agent, of the obligations of an Included
Investor to make Capital Contributions to a Credit Party, or, under the
applicable Investor Letter, to Administrative Agent for the benefit of the
Secured Parties.
 
“Current Party” is defined in Section 14.13.
 
“Dealer Fee” has the meaning provided in the Fee Letter.
 
“Debtor Relief Laws” means any applicable liquidation, conservatorship,
bankruptcy, moratorium, rearrangement, insolvency, fraudulent conveyance,
reorganization, or similar laws affecting the rights, remedies, or recourse of
creditors generally, including without limitation the United States Bankruptcy
Code and all amendments thereto, as are in effect from time to time during the
term of the Loans.
 
“Default Rate” has the meaning provided in the Fee Letter.
 
“Defaulting Alternate Lender” means any Alternate Lender that: (a) has failed to
make its Pro Rata Share of any advance required to be made in respect of Loans
or any disbursement by the Letter of Credit Issuer in respect of Loans or
Letters of Credit, respectively; (b) has otherwise failed to pay over to the
Administrative Agent or any other Lender any other amount required to be paid by
it hereunder within one (1) Business Day of the date when due, unless the
subject of a good faith dispute; or (c) has been deemed insolvent or become the
subject of a bankruptcy or insolvency proceeding.
 
“Defaulting Investor” is defined in Section 2.1(c) hereof.
 
“Designated Exclusion Event” means that, at any time, either: (a) five (5)
Designated Investors are Defaulting Investors, or (b) Designated Investors with
an aggregate Unfunded Capital Commitment greater than 10% of the total aggregate
Unfunded Capital Commitment of all Investors are Defaulting Investors, provided,
that for purposes of determining a Designated Exclusion Event, any (i)
Designated Investor that becomes a Defaulting Investor but that is replaced by
the Credit Parties with a new Designated Investor, or (ii) whose obligations are
transferred to any existing Designated Investor or Included Investor in
accordance with the terms of this Credit Agreement and the Operating Agreement
or Stockholders Agreement, as applicable, shall not be counted.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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“Designated Investor” means any Investor (other than an Included Investor):  (a)
that has been so designated by 100% of the Lenders (in their sole discretion) as
a Designated Investor, as evidenced in writing executed by Administrative Agent;
and (b) that has delivered to Administrative Agent the information and documents
required under Section 8.1(p); provided that, from and after the occurrence of
an Investor’s Effective Removal Date, the Investor shall no longer be a
Designated Investor until such time as all Exclusion Events affecting such
Investor have been cured and such Investor shall have been approved again as a
Designated Investor in the sole and absolute discretion of the Required
Lenders.  Designated Investors approved as such as of the Closing Date are as
set forth on Exhibit A.
 
“Dollars” and the sign “$” means lawful currency of the United States of
America.
 
“Downgrade Collateral Account” is defined in Section 7.2(a) hereof.
 
“Downgrade Draw” is defined in Section 7.2(a) hereof.
 
“Effective Removal Date” means, with respect to any Investor, fifteen (15)
Business  Days following the occurrence of an Exclusion Event with respect to
such Investor.
 
“Eligible Assignee” means: (a) a Lender or Program Support Provider; (b) an
Affiliate of a Lender or an Approved Fund with respect to a Lender; and (c) any
other Person approved by: (i) Administrative Agent and, (ii) unless an Event of
Default exists and is continuing at the time any assignment is effected in
accordance with Section 14.12(b) hereof, Borrower, each such approval not to be
unreasonably withheld or delayed by Borrower or Administrative Agent, as
applicable, and such approval to be deemed given by Borrower if no objection is
received by the assigning Lender and Administrative Agent from Borrower within
five (5) Business Days after notice of such proposed assignment has been
provided by the assigning Lender to Borrower; provided, however, that no Credit
Party or Affiliate of any Credit Party shall qualify as an “Eligible Assignee.”
 
“Eligible Available Contributions of the Designated Investors” means, as of any
date, an amount equal to the sum of the products of (a) the Inclusion Percentage
for each Designated Investor multiplied by (b) the Unfunded Capital Commitment
of such Designated Investor, provided, that at any time a Designated Exclusion
Event has occurred and is continuing, the Eligible Available Contributions of
all Designated Investors shall be zero.
 
“Eligible Available Contributions of the Included Investors” means, as of any
date, an amount equal to the sum of the products of (a) the Inclusion Percentage
for each Included Investor multiplied by (b) the Unfunded Capital Commitment of
such Included Investor.
 
“Environmental Complaint” means any complaint, order, demand, citation or notice
threatened or issued in writing to any Credit Party by any Person with regard to
air emissions, water discharges, Releases, or disposal of any Hazardous
Material, noise emissions or any other environmental, health or safety matter
affecting any Credit Party or any of their Properties.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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“Environmental Laws” means:  (a) the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended by the Superfund Amendments
and Re-authorization Act of 1986, 42 U.S.C. §9601 et seq.; (b) the Resource
Conservation and Recovery Act of 1976, as amended by the Hazardous and Solid
Waste Amendments of 1984, 42 U.S.C. §6901 et seq.; (c) the Clean Air Act, 42
U.S.C. §7401 et seq., as amended by the Clean Air Act Amendments of 1990;
(d) the Clean Water Act of 1977, 33 U.S.C. §1251 et seq.; (e) the Toxic
Substances Control Act, 15 U.S.C.A. §2601 et seq.; (f) all other federal, state
and local laws, or ordinances, regulations or policies relating to pollution or
protection of human health or the environment including without limitation, air
pollution, water pollution, noise control, or the use, handling, discharge,
disposal or Release or recovery of on-site or off-site Hazardous Materials, as
each of the foregoing may be amended from time to time, applicable to any Credit
Party, and (g) any and all regulations promulgated under or pursuant to any of
the foregoing statutes.
 
“Environmental Liability” means any written claim, demand, obligation, cause of
action, accusation or allegation, or any order, violation, damage (including,
without limitation, to any Person, property or natural resources), injury,
judgment, penalty or fine, cost of enforcement, cost of remedial action,
cleanup, restoration or any other cost or expense whatsoever, including Attorney
Costs and disbursements resulting from the violation or alleged violation of any
Environmental Law or the imposition of any Environmental Lien or otherwise
arising under any Environmental Law or resulting from any common law cause of
action asserted by any Person.
 
“Environmental Lien” means a Lien in favor of any Governmental
Authority:  (a) under any Environmental Law; or (b) for any liability or damages
arising from, or costs incurred by, any Governmental Authority in response to
the Release or threatened Release of any Hazardous Material.
 
“Environmental Requirement” means any Environmental Law, agreement, or
restriction, as the same now exists or may be changed, amended, or come into
effect in the future, which pertains to health, safety, or the environment,
including, but not limited to ground, air, water, or noise pollution, or
underground or aboveground tanks.
 
“Equity Interest” means, (a) with respect to any member of Borrower, its
Membership Interest, and (b) with respect to any Stockholder, its Stockholder
Interest.
 
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended,
and the rules and regulations promulgated thereunder by any Governmental
Authority, as from time to time in effect.
 
“ERISA Investor” means an Investor that is (a) an “employee benefit plan” (as
such term is defined in Section 3(3) of ERISA) subject to Title I of ERISA,
(b) any “plan” defined in Section 4975(e) of the Code other than a governmental
plan, (c) a group trust, as described in Revenue Ruling 81-100, or (d) a
partnership or commingled account of a fund, or any other entity, whose assets
include or are deemed to include the assets of one or more such employee benefit
plans subject to Title I of ERISA, as determined under Section 2510.3-101 or
Section 2550.401c-1 of the regulations of the United States Department of Labor
or under any other relevant legal authority.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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“Event of Default” is defined in Section 12.1 hereof.
 
“Excluded Taxes” means, with respect to any Tax Indemnified Party or any other
recipient of any payment to be made by or on account of any obligation of any
Credit Party hereunder: (a) taxes imposed on or measured by its net income
(however denominated), and franchise taxes imposed on it (in lieu of net income
taxes), by the jurisdiction (or any political subdivision thereof) under the
laws of which such Tax Indemnified Party or recipient is organized or in which
its principal office is located or, in the case of any Lender, in which its
applicable Lending Office is located; (b) any branch profits taxes imposed by
the United States or any similar tax imposed by any other jurisdiction in which
such Credit Party is located; and (c) in the case of a Foreign Person (other
than an assignee pursuant to a request by the Borrower under Section 14.14), any
withholding tax that (i) is attributable to such Foreign Person’s failure or
inability (other than as a result of a Change in Law) to comply with
Section 4.1(e), or (ii) is imposed on amounts payable to such Foreign Person at
the time such Foreign Person becomes a party hereto (or designates a new Lending
Office) except to the extent of the additional amounts, if any, that such
Foreign Person (or its assignor, if any) was entitled, at the time of
designation of a new Lending Office (or assignment), to receive from the
Borrower with respect to such withholding tax pursuant to Section 4.1(a).
 
“Exclusion Event” is defined in Section 2.1(c) hereof.
 
“Facility Amount” means an amount equal to $75,000,000 as it may be reduced by
Borrower pursuant to Section 3.6, or increased pursuant to Section 2.12 (not to
exceed the Maximum Commitment).
 
“Facility Increase Request” means the notice in the form of Exhibit G pursuant
to which Borrower requests an increase of the Commitments in accordance with
Section 2.12.
 
“Federal Funds Rate” means, for any day, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) equal to the weighted average of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers on such day, as published by
the Federal Reserve Bank of New York on the Business Day next succeeding such
day; provided that (a) if such day is not a Business Day, the Federal Funds Rate
for such day shall be such rate on such transactions on the next preceding
Business Day as so published on the next succeeding Business Day, and (b) if no
such rate is so published on such next succeeding Business Day, the Federal
Funds Rate for such day shall be the average rate charged to the Administrative
Agent on such day on such transactions as determined by it.
 
“Fee Letter” shall mean, collectively, each separate letter agreement by and
among Borrower and each Managing Agent and/or Administrative Agent, together
with all amendments and modifications thereof.
 
“Foreign Person” means, with respect to any Credit Party, any Tax Indemnified
Party that is a resident of or organized under the laws of a jurisdiction other
than that in which such Credit Party is resident for tax purposes.  For purposes
of this definition, the United States, each State thereof and the District of
Columbian shall be deemed to constitute a single jurisdiction.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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“Funding Ratio” means:  (a) for a Governmental Plan Investor, the actuarial
present value of the assets of the plan over the actuarial present value of the
plan’s total benefit liabilities, as reported in such plan’s audited financial
statements; and (b) for an ERISA Investor, the funded current liability
percentage reported on Schedule B to the most recent Form 5500 filed by such
plan with the United States Department of Labor.
 
“Generally Accepted Accounting Principles” or “GAAP” means those generally
accepted accounting principles and practices that are recognized as such by the
American Institute of Certified Public Accountants or by the Financial
Accounting Standards Board or through other appropriate boards or committees
thereof, and that are consistently applied for all periods, after the date
hereof, so as to properly reflect the financial position of such Person, except
that any accounting principle or practice required to be changed by the
Financial Accounting Standards Board (or other appropriate board or committee of
the said Board) in order to continue as a generally accepted accounting
principle or practice may be so changed.
 
“Governmental Authority” means any foreign governmental authority, the United
States of America, any State of the United States of America, and any
subdivision of any of the foregoing, and any agency, department, commission,
board, authority or instrumentality, bureau or court having jurisdiction over
any Credit Party, any Agent, any Lender or the Letter of Credit Issuer, or any
of their respective businesses, operations, assets, or properties.
 
“Governmental Plan Investor” means an Investor that is a pension plan and that
is a governmental plan as defined in Section 3(32) of ERISA.
 
“Guaranteed Obligations” means those obligations guaranteed by the Guarantor
pursuant to the Guaranty of Capital.
 
“Guarantor” is defined in the preamble to this Credit Agreement.
 
“Guaranty” means the guaranty of the Guarantor made pursuant to the Guaranty of
Capital.
 
“Guaranty Obligations” means, with respect to any Person, without duplication,
any obligations (other than endorsements in the ordinary course of business of
negotiable instruments for deposit or collection) guaranteeing any Indebtedness
of any other Person in any manner, whether direct or indirect, and including
without limitation any obligation, whether or not contingent:  (a) to purchase
any such Indebtedness or other obligation or any property constituting security
therefor; (b) to advance or provide funds or other support for the payment or
purchase of such Indebtedness or obligation or to maintain working capital,
solvency or other balance sheet condition of such other Person (including,
without limitation, maintenance agreements, comfort letters, take or pay
arrangements, put agreements or similar agreements or arrangements) for the
benefit of the holder of Indebtedness of such other Person; (c) to lease or
purchase property, securities or services primarily for the purpose of assuring
the owner of such Indebtedness; or (d) to otherwise assure or hold harmless the
owner of such Indebtedness or obligation against loss in respect thereof.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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“Guaranty of Capital” means that certain Guaranty of Capital, substantially in
the form of Exhibit P, dated as of the date hereof, executed by Guarantor in
favor of Administrative Agent on behalf of the Secured Parties.
 
“Hazardous Material” means any substance, material, or waste which is or becomes
regulated, under any Environmental Law, as hazardous to public health or safety
or to the environment, including, but not limited to:  (a) any substance or
material designated as a “hazardous substance” pursuant to Section 311 of the
Clean Water Act, as amended, 33 U.S.C. §1251 et seq., or listed pursuant to
Section 307 of the Clean Water Act, as amended; (b) any substance or material
defined as “hazardous waste” pursuant to Section 1004 of the Resource
Conservation and Recovery Act, as amended, 42 U.S.C. §6901 et seq.; (c) any
substance or material defined as a “hazardous substance” pursuant to Section 101
of the Comprehensive Environmental Response, Compensation and Liability Act, as
amended, 42 U.S.C. §9601 et seq.; or (d) petroleum, petroleum products and
petroleum waste materials.
 
“Hedging Agreements” means, collectively, interest rate protection agreements,
foreign currency exchange agreements, commodity purchase or option agreements or
other interest or exchange rate or commodity price hedging agreements, in each
case, entered into or purchased by Borrower.
 
“Honor Date” is defined in Section 2.5(c)(i) hereof.
 
“Implicit Borrowing Base Deficit” means, on any date of determination, the
amount (if any) by which:  (a) the aggregate Principal Obligation is in excess
of (b) the Borrowing Base (provided that, for purposes of this definition, the
Borrowing Base shall be calculated as if each Effective Removal Date related to
each Exclusion Event shall have occurred).
 
“Included Investor” means an Investor: (a) that has, or that has a Credit
Provider that has, met the Applicable Requirement for such Investor and that has
been designated on the Closing Date by Administrative Agent as an “Included
Investor”; (b) that has delivered to Administrative Agent the information and
documents required under Section 8.1(p); and (c) for Investors being added to
the Borrowing Base as an “Included Investor” after the Closing Date,
satisfaction of the requirements in clauses (a) and (b) above and (i) in the
case of a Rated Investor, with the consent of the Administrative Agent, acting
alone (which shall not be unreasonably withheld) as evidenced in a writing
executed by Administrative Agent, and (ii) in the cased of a Non-Rated Investor,
with the consent of 100% of the Lenders, as evidenced in a writing executed by
Administrative Agent; provided that a Defaulting Investor shall no longer be an
Included Investor until such time as all Exclusion Events affecting such
Investor have been cured and such Investor shall have been approved in writing
as an Included Investor in the sole and absolute discretion of Administrative
Agent, the Letter of Credit Issuer, and all of the Lenders.  Included Investors
approved as such on the Closing Date are as set forth on Exhibit A.
 
“Inclusion Percentage” means, (a) with respect to each Included Investor and
each Designated Investor, the highest percentage (up to 100%) which results in
an aggregate amount of Unfunded Capital Commitment of such Investor at such time
not exceeding the applicable Concentration Limit (as set forth below) for such
Investor as a percentage of the total aggregate Unfunded Capital Commitment of
all Investors at such time:
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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Rating (1)
Concentration Limit (as a percentage of the
total aggregate Unfunded Capital Commitment
 of all Investors)
AAA/Aaa
15.0%
AA-/Aa3
15.0%
A-/A3 or higher
10.0%
BBB/Baa2 or higher
5.0%
Non-Rated Included Investors(2)
15.0%
Designated Investors(3)
2.0%

 
(1)           Is the lower of the Rating of the Investor (or its Credit
Provider, if applicable) as issued by either Standard & Poor’s or Moody’s.  If
any Investor has only one Rating from either Standard & Poor’s or Moody’s, then
that Rating shall apply.  For any Investor that is an unrated subsidiary of a
parent with a Rating, a guaranty from the rated parent entity is required in
order to apply the Concentration Limit applicable to the rated parent.
 
(2)           In the aggregate may not exceed 50% of the total aggregate
Unfunded Capital Commitment of all Investors at any time.
 
(3)           In the aggregate may not exceed 45% of the total aggregate
Unfunded Capital Commitment of all Investors at any time.
 
(b)           notwithstanding anything in clause (a) of this definition to the
contrary, so long as Yale University and/or any of its affiliates qualifies as
an Included Investor and has a Rating of AAA/Aaa, its Concentration Limit
(collectively with any affiliates) will be 17%.
 
“Indebtedness” means, as to any Person at a particular time, without
duplication, all of the following, whether or not included as indebtedness or
liabilities in accordance with GAAP:
 
(a) all obligations of such Person for borrowed money and all obligations of
such Person evidenced by bonds, debentures, notes, loan agreements or other
similar instruments;
 
(b) all direct or contingent obligations of such Person arising under letters of
credit (including standby and commercial), bankers’ acceptances, bank guaranties
and similar instruments;
 
(c) all net obligations of such Person under any Swap Contract;
 
(d) all obligations of such Person to pay the deferred purchase price of
property or services (other than trade accounts payable in the ordinary course
of business);
 
(e) all indebtedness (excluding prepaid interest thereon) secured by a Lien on
property owned or being acquired by such Person (including indebtedness arising
under conditional sales or other title retention agreements), whether or not
such indebtedness shall have been assumed by such Person or is limited in
recourse;
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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(f) all Capital Leases and Synthetic Lease Obligations; and
 
(g) all Guaranty Obligations of such Person in respect of any of the foregoing.
 
For all purposes hereof, the Indebtedness of any Person shall include the
Indebtedness of any partnership or joint venture (other than a joint venture
that is itself a corporation or limited liability company) in which such Person
is a general partner or a joint venturer, unless such Indebtedness is expressly
made non-recourse to such Person.  The amount of any net obligation under any
Swap Contract on any date shall be deemed to be the Swap Termination Value
thereof as of such date.  The amount of any Capital Lease or Synthetic Lease
Obligation as of any date shall be deemed to be the amount of Attributable
Indebtedness in respect thereof as of such date.
 
“Indemnified Taxes” means Taxes other than Excluded Taxes.
 
“Indemnitee” is defined in Section 14.6(b) hereof.
 
“Interest Component” means, with respect to a Conduit Lender, at any time of
determination, the aggregate for all Related Commercial Paper of such Conduit
Lender at such time of:  (a) with respect to any Commercial Paper issued on an
interest bearing basis, the interest payable on such Commercial Paper at its
maturity (including any dealer commissions); and (b) with respect to any
Commercial Paper issued on a discount basis, the portion of the face amount of
such Commercial Paper representing the discount incurred in respect thereof
(including any dealer commissions).
 
“Interest Period” means, (a) with respect to any Portion of Loans funded by the
issuance of Commercial Paper, (i) initially the period commencing on (and
including) the date of the initial purchase or funding of such Portion of Loans
and ending on (and including) the last day of the current calendar month, and
(ii) thereafter, each period commencing on (and including) the first day after
the last day of the immediately preceding Interest Period for such Portion of
Loans and ending on (and including) the last day of the current calendar month;
and (b) with respect to any Portion of Loans not funded by the issuance of
Commercial Paper, (i) initially the period commencing on (and including) the
date of the initial purchase or funding of such Portion of Loans and ending on
(but excluding) the next following Settlement Date, and (ii) thereafter, each
period commencing on (and including) a Settlement Date and ending on (but
excluding) the next following Settlement Date; provided, that
 
(A)           any Interest Period with respect to any Portion of Loans which
would otherwise end on a day which is not a Business Day shall be extended to
the next succeeding Business Day; provided, however, if Yield in respect of such
Interest Period is computed by reference to the LIBOR Rate, and such Interest
Period would otherwise end on a day which is not a Business Day, and there is no
subsequent Business Day in the same calendar month as such day, such Interest
Period shall end on the next preceding Business Day;
 
(B)           in the case of any Interest Period for any Portion of Loans which
commences before the Maturity Date and would otherwise end on a date occurring
after the Maturity Date, such Interest Period shall end on (but exclude) such
Maturity Date and the duration of each Interest Period which commences on or
after the Maturity Date shall be of such duration as shall be selected by the
applicable Managing Agent; and
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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(C)           any Interest Period in respect of which Yield is computed by
reference to the CP Rate may be terminated at the election of applicable
Managing Agent, in which case the Portion of Loans allocated to such terminated
Interest Period shall be allocated to a new Interest Period commencing on (and
including) the date of such termination and ending on (but excluding) the next
following Settlement Date, and shall accrue Yield at the Alternate Rate.
 
“Internal Revenue Code” means the United States Internal Revenue Code of 1986,
as amended.
 
“Investment Period” has the meaning provided in the Operating Agreement.
 
“Investor” means each of Managing Member, Pledgor, any other member of Borrower
or Stockholder of Pledgor, as applicable.
 
“Investor Letter” is defined in Section 5.1(b) hereof.
 
“Investor Documents” means the Operating Agreement, the Stockholders Agreement,
each Investor Letter, and any amendments or supplements thereto or modifications
thereof, executed or delivered pursuant to the terms thereof and this Credit
Agreement, and any additional documents delivered in connection with any such
amendment, supplement or modification.
 
“ISP” means, with respect to any Letter of Credit, the “International Standby
Practices 1998” published by the Institute of International Banking Law &
Practice (or such later version thereof as may be in effect at the time of
issuance).
 
“Issuer Documents” means with respect to any Letter of Credit, the Request for
Letter of Credit, the Application and Agreement for Letter of Credit, and any
other document, agreement and instrument entered into by the Letter of Credit
Issuer and a Borrower Party or in favor of the Letter of Credit Issuer and
relating to any such Letter of Credit.
 
“L/C Advance” means, with respect to each Lender, such Lender’s funding of its
participation in any L/C Borrowing.  All L/C Advances shall be denominated in
Dollars.
 
“L/C Borrowing” means an extension of credit resulting from a drawing under any
Letter of Credit which has not been reimbursed on the date when made or
refinanced as a Borrowing.  All L/C Borrowings shall be denominated in Dollars.
 
“Laws” means, collectively, all international, foreign, Federal, state and local
statutes, treaties, rules, guidelines, regulations, ordinances, codes and
administrative or judicial precedents or authorities, including the
interpretation or administration thereof by any Governmental Authority charged
with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental Authority,
in each case whether or not having the force of law.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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“Lender” means each Conduit Lender and each Alternate Lender, as the context may
require, and collectively, the “Lenders”.
 
“Lender Group” means each of:  (a) the YC SUSI Lender Group; and (b) any other
“Lender Group” from time to time party hereto in accordance with the terms
hereof as designated by the Managing Agent of such group.
 
“Lender Group Percentage” means, for any Lender Group, the percentage equivalent
(carried out to five decimal places) of a fraction the numerator of which is the
aggregate Commitments or Principal Obligation, as applicable, of all Lenders in
such Lender Group and the denominator of which is the aggregate Commitments or
Principal Obligation, as applicable, of all Lenders in all Lender Groups.
 
“Lender Party” is defined in Section 13.1(a) hereof.
 
“Lending Office” means, as to any Lender, the office or offices of such Lender
(or an affiliate of such Lender) identified on Schedule 14.7, or such other
office or offices as a Lender may from time to time notify Borrower and
Administrative Agent.
 
“Letter of Credit” means a standby letter of credit issued by the Letter of
Credit Issuer pursuant to Section 2.5 hereof in the form of Exhibit D-2 hereto
(or such other form as approved by the Letter of Credit Issuer) in Dollars
either as originally issued or as the same may, from time to time, be amended or
otherwise modified or extended.
 
“Letter of Credit Expiration Date” means the day that is the earlier of:
(a) fifteen (15) days prior to the Stated Maturity Date then in effect (or, if
such day is not a Business Day, the next preceding Business Day); or (b) the
date upon which Administrative Agent declares the Obligations due and payable
after the occurrence of an Event of Default.
 
“Letter of Credit Fees” is defined in Section 2.10 hereof.
 
“Letter of Credit Issuer” means Bank of America, or any Lender or Affiliate of
such Lender so designated, and which accepts such designation, by Administrative
Agent and approved by Borrower.
 
“Letter of Credit Liability” means the aggregate amount of the undrawn face
amount of all outstanding Letters of Credit plus the amount drawn under Letters
of Credit for which the Letter of Credit Issuer and Lenders, or any one or more
of them, have not yet received payment or reimbursement (in the form of a
conversion of such liability to Loans, or otherwise) as required pursuant to
Section 2.5.  For all purposes of this Credit Agreement, if on any date of
determination a Letter of Credit has expired by its terms but any amount may
still be drawn thereunder by reason of the operation of Rule 3.14 of the ISP,
such Letter of Credit shall be deemed to be “outstanding” in the amount so
remaining available to be drawn.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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“Letter of Credit Sublimit” means, at any time, seventy-five percent (75%) of
the Facility Amount at such time.
 
“LIBOR Rate” means, for any Interest Period for any Portion of Loans for any
Lender Group, a rate per annum determined by Administrative Agent pursuant to
the following formula:
 
LIBOR Rate =
London Interbank Offered Rate
 
1.00 – Eurocurrency Reserve Percentage
where,
 

 
“London Interbank Offered Rate” means, for such Interest Period:
 
(a)           the rate per annum (carried out to the fifth decimal place) equal
to the rate that appears on the page of the Telerate Screen that displays an
average British Bankers Association Interest Settlement Rate (such page
currently being page number 3750) for deposits in Dollars (for delivery on the
first day of such Interest Period) with a term equivalent to such Interest
Period, determined as of approximately 11:00 a.m. (London time) two Business
Days prior to the first day of such Interest Period, or
 
(b)           in the event that the rate referenced in the preceding subsection
(a) does not appear on such page or service or such page or service shall cease
to be available, the rate per annum (carried to the fifth decimal place) equal
to the rate determined by Administrative Agent to be the offered rate on such
other page or other service that displays an average British Bankers Association
Interest Settlement Rate for deposits in Dollars (for delivery on the first day
of such Interest Period) with a term equivalent to such Interest Period,
determined as of approximately 11:00 a.m. (London time) two Business Days prior
to the first day of such Interest Period for a term comparable to such Interest
Period, or
 
(c)           in the event the rates referenced in the preceding subsections (a)
or (b) are not available, the rate per annum determined by Administrative Agent
as the rate of interest at which deposits in Dollars (for delivery on the first
day of such Interest Period) in same day funds in the approximate amount of the
applicable Portion of Loans to be funded by reference to the LIBOR Rate and with
a term equivalent to such Interest Period would be offered by its London Branch
to major banks in the offshore interbank market at their request at
approximately 11:00 a.m. (London time) two Business Days prior to the first day
of such Interest Period; and
 
“Eurocurrency Reserve Percentage” means, for any day during any Interest Period,
the maximum effective reserve percentage (expressed as a decimal, carried out to
the fifth decimal place) in effect on such date, whether or not applicable to
any Lender, under regulations issued from time to time by the Board of Governors
of the Federal Reserve System (or any successor), as such regulation may be
amended from time to time or any successor regulation, for determining the
maximum reserve requirement (including any supplemental, emergency, or marginal
reserve requirement) with respect to eurocurrency funding (currently referred to
as “eurocurrency liabilities”).  The LIBOR Rate shall be adjusted automatically
on and as of the effective date of any change in the Eurocurrency Reserve
Percentage.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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“Lien” means any lien, mortgage, security interest, tax lien, pledge,
encumbrance, or conditional sale or title retention arrangement, or any other
interest in property designed to secure the repayment of indebtedness, whether
arising by agreement or under any statute or law, or otherwise.
 
“Liquidity Commitment” means an amount equal to 102% of the Facility Amount in
effect from time to time.
 
“Loan” means an extension of credit by a Lender to a Borrower Party pursuant to
the terms and conditions of this Credit Agreement, and “Loans” means the plural
thereof.  All Loans shall be denominated in Dollars.
 
“Loan Amount” is defined in Section 2.3(g) hereof.
 
“Loan Date” is defined in Section 2.3(a) hereof.
 
“Loan Deficit” is defined in Section 2.3(h) hereof.
 
“Loan Documents” means this Credit Agreement, the Notes (including any renewals,
extensions, re-issuances and refundings thereof), each Application and Agreement
for Letter of Credit, each of the Collateral Documents, the Guaranty of Capital,
each Assignment and Assumption Agreement and such other agreements and
documents, and any amendments or supplements thereto or modifications thereof,
executed or delivered pursuant to the terms of this Credit Agreement or any of
the other Loan Documents and any additional documents delivered in connection
with any such amendment, supplement or modification.
 
“Loan Notice” means any notice substantially in the form of Exhibit C,
containing the information specified therein, executed and delivered by a
Borrower Party.
 
“Managing Agent” means, with respect to any Lender Group, the Person acting as
Managing Agent therefor and designated as such on the signature pages hereto or
in the assignment pursuant to which such Lender Group becomes a party hereto,
and its successors and assigns.
 
“Managing Member” is defined in the preamble to this Credit Agreement.
 
“Margin Stock” shall have the meaning assigned to such term in Regulation U.
 
“Material Adverse Effect” means any circumstances or events which could
reasonably be expected to:  (a) have any material adverse effect upon the
validity, performance, or enforceability of any of the Loan Documents executed
by Borrower, any Qualified Borrower, Managing Member, Guarantor or Pledgor;
(b) materially impair the ability of Borrower, Managing Member, Guarantor or
Pledgor, or any one of them, to fulfill their respective obligations under the
Loan Documents; (c) cause an Event of Default; or (d) impair, impede, or
jeopardize, in any material respect, the obligation or the liability of
Borrower, Managing Member, Guarantor or Pledgor to fulfill its obligations under
the Operating Agreement, Stockholders Agreement or Partnership Agreement, as
applicable.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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“Maturity Date” means the earliest of: (a) the Stated Maturity Date; (b) the
date upon which Administrative Agent declares the Obligations due and payable
after the occurrence of an Event of Default; (c) the date upon which Borrower
terminates the Commitments pursuant to Section 3.6 hereof or otherwise and (d)
fifteen (15) Business Days prior to the end of the Investment Period.
 
“Maximum Commitment” means an amount equal to $300,000,000, as it may be reduced
by Borrower pursuant to Section 3.6.
 
“Maximum Rate” means, on any day, the highest rate of interest (if any)
permitted by applicable law on such day.
 
“Membership Interest” means, with respect to any member of Borrower, the equity
interest of such member in Borrower.
 
“Moody’s” means Moody’s Investors Service, Inc. and any successor thereto.
 
“Non-Defaulting Alternate Lender” is defined in Section 2.3(h) hereof.
 
“Non-Extension Notice Date” is defined in Section 2.5(b)(iii) hereof.
 
“Non-Rated Investor” means an Investor that is not a Rated Investor.
 
“Non-Rated Included Investor” means an Included Investor that is not a Rated
Investor.
 
“Notes” means the promissory notes provided for in Section 3.1 hereof, and all
promissory notes delivered in substitution or exchange therefor, as such notes
may be amended, restated, reissued, extended or modified, and the Qualified
Borrower Notes; and “Note” means any one of the Notes.
 
“Obligations” means all present and future Indebtedness, obligations, and
liabilities of any Credit Party to any of the Secured Parties, and all renewals
and extensions thereof (including, without limitation, Loans, Letters of Credit
Liability, or both), or any part thereof, arising pursuant to this Credit
Agreement (including, without limitation, the indemnity provisions hereof) or
represented by the Notes and each Application and Agreement for Letter of
Credit, and all interest accruing thereon, and Attorney Costs incurred in the
enforcement or collection thereof, regardless of whether such indebtedness,
obligations, and liabilities are direct, indirect, fixed, contingent, joint,
several, or joint and several; together with all indebtedness, obligations, and
liabilities of any Credit Party to any of the Secured Parties evidenced or
arising pursuant to any of the other Loan Documents, and all renewals and
extensions thereof, or any part thereof.
 
“Operating Agreement” means that certain Operating Agreement of Borrower, by and
among Managing Member and Pledgor dated as of May 15, 2007, as supplemented by
that certain pledge agreement, dated as of May 15, 2007, from Pledgor to
Borrower, as each may be restated, modified, amended or supplemented from time
to time, with the consent of Administrative Agent, the Letter of Credit Issuer,
and the Lenders to the extent expressly required hereby.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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“Operating Company” means an “operating company” within the meaning of 29 C.F.R.
§2510.3-101(c) of the regulations of the United States Department of Labor.
 
“Other Taxes” means all present or future stamp or documentary taxes or any
other excise or property taxes, charges or similar levies arising from any
payment made hereunder or under any other Loan Document or from the execution,
delivery or enforcement of, or otherwise with respect to, this Credit Agreement
or any other Loan Document.
 
“Participant” is defined in Section 14.12(f).
 
“Partnership Agreement” means that certain Agreement of Limited Partnership of
Guarantor, dated as of May 13, 2003, as previously restated, modified, amended
or supplemented from time to time, with the consent of the Administrative Agent,
the Letter of Credit Issuer and the Lenders to the extent expressly required
hereby.
 
“Pending Capital Call” means any Capital Call that has been made upon the
Investors and that has not yet been funded by the applicable Investor, but with
respect to which such Investor is not in default.
 
“Person” means an individual, sole proprietorship, joint venture, association,
trust, estate, business trust, corporation, limited liability company, nonprofit
corporation, partnership, sovereign government or agency, instrumentality, or
political subdivision thereof, or any similar entity or organization.
 
“Plan” means any plan, including single employer and multi-employer plans to
which Section 4021(a) of ERISA applies, or any retirement medical plan, each as
established or maintained for employees of Borrower or any member of the
Controlled Group to which Section 4021(a) of ERISA applies.
 
“Plan Asset Regulations” means 29 C.F.R §2510.3-101, et seq.
 
“Plan Assets” means “plan assets” within the meaning of the Plan Asset
Regulations.
 
“Pledgor” is defined in the first paragraph hereof.
 
“Portion of Loan” is defined in Section 2.4 hereof.
 
“Potential Default” means any condition, act, or event which, with the giving of
notice or lapse of time or both, would become an Event of Default.
 
“Principal Obligation” means the sum of: (a) the aggregate outstanding principal
amount of the Loans; plus (b) the Letter of Credit Liability.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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“Pro Rata Share” means, with respect to each Lender, the percentage obtained
from the fraction:  (a) (i) the numerator of which is the Commitment of such
Lender; and (ii) the denominator of which is the aggregate Commitments of all
Lenders; or (b) in the event the Commitments are zero (0):  (i) the numerator of
which is the Principal Obligation outstanding with respect to such Lender; and
(ii) the denominator of which is the total Principal Obligation outstanding.
 
“Program Support Agreement” means and includes, with respect to any Conduit
Lender, any agreement entered into by any Program Support Provider providing for
the issuance of one or more letters of credit for the account of such Conduit
Lender (or any related commercial paper issuer that finances such Conduit
Lender), the issuance of one or more surety bonds for which such Conduit Lender
(or such related issuer) is obligated to reimburse the applicable Program
Support Provider for any drawings thereunder, the sale by such Conduit Lender
(or such related issuer) to any Program Support Provider of its interests
hereunder (or portions thereof or participations therein) or the making of loans
or other extensions of credit to such Conduit Lender (or such related issuer) in
connection with such Conduit Lender’s (or such related issuer’s) commercial
paper program, together with any letter of credit, surety bond or other
instrument issued thereunder.
 
“Program Support Provider” means and includes, with respect to any Conduit
Lender, any Person now or hereafter extending credit or having a commitment to
extend credit to or for the account of, or to make purchases from, such Conduit
Lender (or any related commercial paper issuer that finances such Conduit
Lender) or issuing a letter of credit, surety bond or other instrument
to  support  any obligations arising under or in connection with such Conduit
Lender’s (or such related issuer’s) commercial paper program.
 
“Prohibited Event” is defined in Section 4.7.
 
“Property” means any real property, improvements thereon and any leasehold or
similar interest in real property which is owned, directly or indirectly, by any
Borrower Party, or secures any investment of any Borrower Party.
 
“Qualified Borrower” means any entity, which entity may be organized in the
United States or outside of the United States, in which Borrower owns a direct
or indirect ownership interest or through which Borrower will acquire an
investment, the indebtedness of which entity can be guaranteed by Borrower
pursuant to the terms of the Operating Agreement, and which entity has executed
a Qualified Borrower Note and in respect of which entity Borrower has executed a
Borrower Guaranty.
 
“Qualified Borrower Letter of Credit Note” means a letter of credit note
executed and delivered by a Qualified Borrower, in the form of Exhibit B-3
attached hereto, the payment of which is guaranteed by Borrower pursuant to a
Borrower Guaranty, as such note may be amended, restated, reissued, extended or
modified.
 
“Qualified Borrower Notes” means the Qualified Borrower Promissory Notes and the
Qualified Borrower Letter of Credit Notes, and “Qualified Borrower Note” means
any one of them, as such note may be amended, restated, reissued, extended or
modified.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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“Qualified Borrower Promissory Note” means a promissory note executed and
delivered by a Qualified Borrower, in the form of Exhibit B-2 attached hereto,
the payment of which is guaranteed by Borrower pursuant to a Borrower Guaranty.
 
“Rate Type” means the LIBOR Rate, the Base Rate or the CP Rate.
 
“Rated Investor” means any Investor that has a Rating (or that has a Credit
Provider, Sponsor, or Responsible Party that has a Rating).
 
“Rating” means, for any Person, its senior unsecured debt rating (or equivalent
thereof, such as, but not limited to, a corporate credit rating, issuer
rating/insurance financial strength rating (for an insurance company), general
obligation rating (for a governmental entity), or revenue bond rating (for an
educational institution)) from either of S&P or Moody’s.
 
“Register” is defined in Section 14.12(e) hereof.
 
“Regulation T,” “Regulation U,” and “Regulation X” means Regulation T, U, or X,
as the case may be, of the Board of Governors of the Federal Reserve System,
from time to time in effect, and shall include any successor or other regulation
relating to reserve requirements or margin requirements, as the case may be,
applicable to member banks of the Federal Reserve System.
 
“Related Commercial Paper” means, with respect to any Conduit Lender, at any
time of determination, Commercial Paper of such Conduit Lender (or its related
commercial paper issuer) the proceeds of which are then allocated by the
Administrator of such Conduit Lender (or its related commercial paper issuer) as
the source of funding the acquisition or maintenance of its Principal Obligation
hereunder.
 
“Release” means any release, spill, emission, leaking, pumping, injection,
deposit, disposal, discharge, dispersal, leaching, or migration of Hazardous
Materials into the environment, or into or out of any Property, including the
movement of any Hazardous Material through or in the air, soil, surface water,
groundwater, of any Property.
 
“Request for Letter of Credit” means a request for the issuance of a Letter of
Credit substantially in the form of Exhibit D-1 hereto.
 
“Required Lenders” means:  (a) Alternate Lenders (other than Defaulting
Alternate Lenders) holding an aggregate of more than fifty (50%) of the
aggregate Commitments of all Alternate Lenders (other than Defaulting Alternate
Lenders); or (b) at any time that the Available Loan Amount is zero (0),
Alternate Lenders (other than Defaulting Alternate Lenders) owed an aggregate of
more than fifty (50%) of the Principal Obligation outstanding and payable to all
Lenders (other than Defaulting Alternate Lenders) at such time (including, for
purposes of such calculation, each Alternate Lender’s Alternate Lender Pro Rata
Share of that portion of the Principal Obligations outstanding and payable to
the Conduit Lender in its Lender Group).
 
“Responsible Officer” means: (a) in the case of a corporation, its president,
senior vice president, any vice president or treasurer, and, in any case where
two Responsible Officers are acting on behalf of such corporation, the second
such Responsible Officer may be a secretary or assistant secretary; (b) in the
case of a limited partnership, the Responsible Officer of the general partner,
acting on behalf of such general partner in its capacity as general partner; and
(c) in the case of a limited liability company, the chief executive officer,
president, general counsel, chief financial officer, or senior vice president of
the managing member, acting on behalf of such managing member in its capacity as
managing member.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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“Responsible Party” means, for any Governmental Plan Investor:  (a) if the state
under which the Governmental Plan Investor operates is obligated to fund the
Governmental Plan Investor and is liable to fund any shortfalls, the state; and
(b) otherwise, the Governmental Plan Investor itself.
 
“S&P” means Standard & Poor’s Rating Services, a division of the McGraw & Hill
Companies, Inc. and any successor thereto.
 
“Secured Parties” means, collectively, the Lenders, Agents, Arranger, Letter of
Credit Issuer, Program Support Providers, Conduit Collateral Agents and
Indemnitees, and “Secured Party” means any of the foregoing.
 
“Settlement Date” means the 12th day of each month (or, if such day is not a
Business Day, on the next succeeding Business Day); provided that after the
Maturity Date, any Business Day selected from time to time by Administrative
Agent shall be a Settlement Date.
 
“Solvent” means, with respect to any Person as of a particular date, that on
such date:  (a) such Person is able to pay its debts and other liabilities,
contingent obligations and other commitments as they mature in the normal course
of business; (b) such Person does not intend to, and does not believe that it
will, incur debts or liabilities beyond such Person’s ability to pay as such
debts and liabilities mature in their ordinary course; (c) such Person is not
engaged in a business or a transaction, and is not about to engage in a business
or a transaction, for which such Person’s assets would constitute unreasonably
small capital after giving due consideration to the prevailing practice in the
industry in which such Person is engaged or is to engage; (d) the fair value of
the assets of such Person is greater than the total amount of liabilities,
including, without limitation, contingent liabilities, of such Person; and
(e) the present fair saleable value of the assets of such Person is not less
than the amount that will be required to pay the probable liability of such
Person on its debts as they become absolute and matured.
 
“Sponsor” of an ERISA Investor means a sponsor as that term is understood under
ERISA, specifically, the entity that established the plan and is responsible for
the maintenance of the plan and, in the case of a plan that has a sponsor and
participating employers, the entity that has the ability to amend or terminate
the plan.
 
“Stockholder” means a holder of shares of the equity interests of Pledgor.
 
“Stockholders Agreement” means the Stockholders Agreement of Pledgor, dated as
of May 15, 2007, as the same may be amended, restated, supplemented or otherwise
modified from time to time with the consent of Administrative Agent, the Letter
of Credit Issuer, and the Lenders to the extent expressly required hereby.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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“Stockholders Interest” means, with respect to any Stockholder, its equity
interest in Pledgor.
 
“Stated Maturity Date” means October 10, 2011.
 
“Subsequent Investor” is defined in Section 11.5(c) hereof.
 
“Swap Contract” means: (a) any and all rate swap transactions, basis swaps,
credit derivative transactions, forward rate transactions, commodity swaps,
commodity options, forward commodity contracts, equity or equity index swaps or
options, bond or bond price or bond index swaps or options or forward bond or
forward bond price or forward bond index transactions, interest rate options,
forward foreign exchange transactions, cap transactions, floor transactions,
collar transactions, currency swap transactions, cross-currency rate swap
transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options
to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement; and (b) any and all transactions
of any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the
International Swaps and Derivatives Association, Inc., any International Foreign
Exchange Master Agreement, or any other master agreement, including any such
obligations or liabilities under any such master agreement.
 
“Swap Termination Value” means, in respect of any one or more Swap Contracts,
after taking into account the effect of any legally enforceable netting
agreement relating to such Swap Contracts: (a) for any date on or after the date
such Swap Contracts have been closed out and termination value(s) determined in
accordance therewith, such termination value(s); and (b) for any date prior to
the date referenced in clause (a), the amount(s) determined as the
mark-to-market value(s) for such Swap Contracts, as determined based upon one or
more mid-market or other readily available quotations provided by any recognized
dealer in such Swap Contracts (which may include a Lender or any Affiliate of a
Lender).
 
“Synthetic Lease Obligation” means the monetary obligation of a Person under:
(a) a so-called synthetic, off-balance sheet or tax retention lease; or (b) an
agreement for the use or possession of property creating obligations that do not
appear on the balance sheet of such Person but which, upon the insolvency or
bankruptcy of such Person, would be characterized as the indebtedness of such
Person (without regard to accounting treatment).
 
“Tax Indemnified Parties” means, collectively, the Letter of Credit Issuer, the
Lenders, Agents, the Program Support Providers and Conduit Collateral Agents,
and “Tax Indemnified Party” means any of the foregoing.
 
“Taxes” means all present or future taxes, levies, imposts, duties, deductions,
withholdings, assessments, fees or other charges imposed by any Governmental
Authority, including any interest, additions to tax or penalties applicable
thereto.
 
“UCC” is defined in Section 8.1.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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“Unfunded Capital Commitment” means, with respect to any Investor at any
time:  (a) such Investor’s Capital Commitment at such time, excluding (1) any
Capital Commitment subject to a Pending Capital Call and (2) returns of Capital
Contributions, unless a confirmation certificate in form and substance
satisfactory to the Administrative Agent has been received by the Administrative
Agent from a Credit Party, reporting the returned Capital Contributions and
providing the amounts of the remaining unfunded Capital Commitments of the
Investors; minus (b) such Investor’s aggregate Capital Contributions made prior
to such time.
 
“Unreimbursed Amount” is defined in Section 2.5(c)(i) hereof.
 
“Used Fee” has the meaning provided in the Fee Letter.
 
“YC SUSI” means YC SUSI Trust, a Delaware Statutory Trust.
 
“YC SUSI Alternate Lenders” means the Alternate Lenders in the YC SUSI Lender
Group, as set forth on the signature pages hereto or the applicable Assignment
and Assumption Agreement.
 
“YC SUSI Lender Group” means YC SUSI, any permitted Conduit Assignee thereof,
the YC SUSI Alternate Lenders from time to time party hereto and Bank of
America, as Managing Agent.
 
“Yield” means, the sum of:
 
(a)           for any Portion of Loans for any Lender Group during any Interest
Period to the extent a Conduit Lender funds such Portion of Loans through the
issuance of Commercial Paper (directly or indirectly through a related
commercial paper issuer);
 
CPR x L x
 
D
   
360

(b)           for any Portion of Loans funded by the Alternate Lenders and for
any Portion of Loans for any Lender Group to the extent the related Conduit
Lender does not fund such Portion of Loans through the issuance of Commercial
Paper (directly or indirectly through a related commercial paper issuer);
 
AR/BR x L x
 
D
   
360

where:
 
AR/BR = the Alternate Rate or Base Rate, as applicable, for such Portion of
Loans for such Interest Period;
 
CPR = the CP Rate for such Portion of Loans for such Interest Period (as
determined by each applicable Administrator on or prior to the fifth Business
Day of the calendar month next following such Interest Period);
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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D = the actual number of days during such Interest Period, and
 
L = the amount of such Portion of Loans during such Interest Period;
 
provided that no provision of this Credit Agreement shall require the payment or
permit the collection of Yield in excess of the Maximum Rate; and provided,
further, that at all times during the existence of an Event of Default or after
the Maturity Date, Yield for all Portions of Loans shall accrue at the Default
Rate. Without limiting the obligation of any Borrower Party to pay interest
pursuant to Section 3.3, Yield shall include interest pursuant to Section 3.3 on
the Principal Obligation and all other Obligations not paid or deposited when
due under this Credit Agreement or under the Notes.
 
1.2. Other Definitional Provisions.
 
(a) All terms defined in this Credit Agreement shall have the above-defined
meanings when used in the Notes or any other Loan Documents or any certificate,
report or other document made or delivered pursuant to this Credit Agreement,
unless otherwise defined in such other document.
 
(b) Defined terms used in the singular shall import the plural and vice versa.
 
(c) The words “hereof,” “herein,” “hereunder,” and similar terms when used in
this Credit Agreement shall refer to this Credit Agreement as a whole and not to
any particular provisions of this Credit Agreement.
 
(d) The term “including” is by way of example and not limitation. The term
“documents” includes any and all instruments, documents, agreements,
certificates, notices, reports, financial statements and other writings, however
evidenced, whether in physical or electronic form.
 
(e) In the computation of periods of time from a specified date to a later
specified date, the word “from” means “from and including;” the words “to” and
“until” each mean “to but excluding;” and the word “through” means “to and
including.”
 
(f) Section headings herein and in the other Loan Documents are included for
convenience of reference only and shall not affect the interpretation of this
Credit Agreement or any other Loan Document.
 
(g) Unless otherwise specified in the Loan Documents, time references are to
time in New York, New York.
 
1.3. Letter of Credit Amounts.  Unless otherwise specified, all references
herein to the amount of a Letter of Credit at any time shall be deemed to mean
the maximum face amount of such Letter of Credit after giving effect to all
increases thereof contemplated by such Letter of Credit or the documents issued
in connection therewith, but only to the extent such maximum face amount is in
effect at such time.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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2. LOANS AND LETTERS OF CREDIT
 
2.1. The Commitment.
 
(a) Committed Amount.  Subject to the terms and conditions herein set forth,
including Sections 8.1, 8.2 (if applicable) and 8.3, Lenders having Commitments
agree severally, during the Availability Period:  (i) to extend to Borrower or
any Qualified Borrower a revolving line of credit; and (ii) to participate in
Letters of Credit issued by the Letter of Credit Issuer for the account of
Borrower or any Qualified Borrower.
 
(b) Limitation on Borrowings.  Notwithstanding anything to the contrary herein
contained, Lenders shall not be required to advance any Borrowing or cause the
issuance of any Letter of Credit hereunder if:
 
(i) after giving effect to such Borrowing or issuance of such Letter of
Credit:  (A) the Principal Obligation would exceed the Available Loan Amount;
(B) the Letter of Credit Liability would exceed the Letter of Credit Sublimit;
or (C) any Implicit Borrowing Base Deficit would exist; or
 
(ii) an Event of Default or a Potential Default exists.
 
(c) Exclusion Events.  If any of the following events (each, an “Exclusion
Event”) shall occur with respect to any Designated Investor or any Included
Investor or, if applicable, the Sponsor, Responsible Party, or Credit Provider
of such Investor (such Investor hereinafter referred to as a “Defaulting
Investor”):
 
(i) it shall:  (A) apply for or consent to the appointment of a receiver,
trustee, custodian, intervenor, or liquidator of itself or of all or a
substantial part of its assets; (B) file a voluntary petition as debtor in
bankruptcy or admit in writing that it is unable to pay its debts as they become
due; (C) make a general assignment for the benefit of creditors; (D) file a
petition or answer seeking reorganization or an arrangement with creditors or
take advantage of any Debtor Relief Laws; (E) file an answer admitting the
material allegations of, or consent to, or default in answering, a petition
filed against it in any bankruptcy, reorganization, or insolvency proceeding; or
(F) take any personal, partnership, limited liability company, corporate or
trust action, as applicable, for the purpose of effecting any of the foregoing;
 
(ii) an order, order for relief, judgment, or decree shall be entered by any
court of competent jurisdiction or other competent authority approving a
petition seeking such Person’s reorganization or appointing a receiver,
custodian, trustee, intervenor, or liquidator of such Person or of all or
substantially all of its assets, and such order, judgment, or decree shall
continue unstayed and in effect for a period of sixty (60) days;
 
(iii) any final judgment(s) for the payment of money which in the aggregate
exceed fifteen percent (15%) of its net worth shall be rendered against such
Person, and such judgment or judgments shall not be satisfied or discharged at
least ten (10) days prior to the date on which any of its assets could be
lawfully sold to satisfy such judgment;
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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(iv) such Investor shall repudiate, challenge, or declare unenforceable its
obligation to make contributions to the capital of the applicable Credit Party
pursuant to its Capital Commitment or a Call Notice; shall otherwise disaffirm
any material provision of the Operating Agreement, the Stockholders Agreement or
the Partnership Agreement, as applicable; or shall otherwise disaffirm any
material provision of its Investor Letter; or a court of competent jurisdiction
finds such Capital Commitment or the obligations under its Investor Letter
unenforceable;
 
(v) such Investor shall fail to make a contribution to the capital of the
applicable Credit Party when required pursuant to a Call Notice, subject to any
applicable notice or cure periods, or shall otherwise be in material default
under the Operating Agreement, the Stockholders Agreement, its Investor Letter
or any Loan Document, following any applicable notice requirements or cure
periods;
 
(vi) any representation or warranty made under its Investor Letter or any Loan
Documents executed by such Person shall prove to be untrue or inaccurate in any
material respect, as of the date on which such representation or warranty is
made, and such Person shall fail to cure the adverse effect of the failure of
such representation or warranty within thirty (30) days after written notice
thereof is delivered by Administrative Agent to Borrower and to such Person;
 
(vii) such Investor shall transfer its Equity Interest in Borrower or Pledgor,
as applicable, in violation of this Credit Agreement;
 
(viii) default shall occur in the performance by it of any of the covenants or
agreements contained in its Investor Letter, the Operating Agreement, the
Stockholders Agreement or the Partnership Agreement (except, in each case, as
otherwise specifically addressed in this Section 2.1(c), in which case no grace
period beyond any provided for herein shall apply) and such default shall
continue uncured to the satisfaction of Administrative Agent for a period of
thirty (30) days after written notice thereof has been given by Administrative
Agent to Borrower and to such Investor;
 
(ix) in the case of each Included Investor that is a Rated Investor, it shall
fail to maintain the Applicable Requirement for such Investor required in the
definition of Applicable Requirement in Section 1 hereof;
 
(x) in the case of any Non-Rated Included Investor, such Investor shall fail to
maintain a net worth (determined in accordance with Generally Accepted
Accounting Principles), measured at the end of each fiscal year of such Person,
of at least seventy-five percent (75%) of the initial net worth of such
Investor, Sponsor, Responsible Party, or Credit Provider measured at the end of
the fiscal year preceding the designation of such Investor as an Included
Investor hereunder; or
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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(xi) in the case of each Designated Investor and Non-Rated Included Investor,
following the occurrence of an event which materially adversely affects the
ability of such Investor to fulfill its obligations under the Operating
Agreement or the Stockholders Agreement, as applicable, and the Required Lenders
elect to declare the occurrence of an Exclusion Event with respect to such
Investor,
 
then as of the Effective Removal Date for such Exclusion Event, such Investor
shall no longer be a Designated Investor or an Included Investor, as applicable,
and Administrative Agent and the Borrower Parties shall treat such Defaulting
Investor’s Capital Commitment and Unfunded Capital Commitment as zero (0) for
purposes of: (A) calculating the aggregate Unfunded Capital Commitment of the
Designated Investors or Included Investors, as applicable, with respect to this
Credit Agreement; (B) calculating the Available Loan Amount and Borrowing Base;
and (C) calculating whether a mandatory prepayment is required to be made by
Borrower pursuant to Section 2.1(d).
 
(d) Mandatory Prepayment.
 
(i) Excess Loans Outstanding.  If, on any day, the Principal Obligation exceeds
the Available Loan Amount or if an Implicit Borrowing Base Deficit exists
(including, without limitation, as a result of an Exclusion Event), then the
Credit Parties shall pay on demand such excess or amount of Implicit Borrowing
Base Deficit, as applicable, to Administrative Agent, for the benefit of
Lenders, in immediately available funds (except to the extent any such excess is
otherwise addressed by Section 2.1(d)(ii): (A) promptly on demand (but in no
event later than one (1) Business Day), to the extent such funds are available
in the Collateral Account or another account maintained by Borrower; and
(B) within fifteen (15) Business Days of demand to the extent that it is
necessary for a Credit Party to issue Call Notices to fund such required payment
(and the Credit Parties shall issue such Call Notices during such time, and
shall pay such excess or amount of Implicit Borrowing Base Deficit, as
applicable, immediately after the Capital Contributions relating to such Call
Notice are received); provided that the amount of such excess shall be paid to
Administrative Agent concurrently with the creation of such excess or deficit if
it results from any willful act of any Credit Party.  The Credit Parties hereby
agree that Administrative Agent may withdraw from the Collateral Account any
Capital Contributions deposited therein in respect of such Call Notices until
the payment obligations required by this Section 2.1(d)(i) have been satisfied
in full.
 
(ii) Excess Letters of Credit Outstanding.  If any excess or amount of Implicit
Borrowing Base Deficit, as applicable, calculated pursuant to Section 2.1(d)(i)
is attributable to undrawn Letters of Credit, the Credit Parties shall Cash
Collateralize the Letter of Credit Liability in the amount of such excess or
Implicit Borrowing Base Deficit, as applicable, when required pursuant to the
terms of Section 2.1(d)(i), as security for such portion of the
Obligations.  Unless otherwise required by law, upon:  (i) a change in
circumstances such that the Principal Obligation no longer exceeds the Available
Loan Amount; or (ii) the full and final payment of the Obligations,
Administrative Agent shall return to the Credit Parties (or the applicable
Qualified Borrower) any amounts remaining in said cash collateral account.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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(e) Loans in Dollars.  Each Loan made pursuant to this Credit Agreement shall be
both funded and payable in Dollars.
 
2.2. Revolving Credit Commitment.  Subject to the terms and conditions herein
set forth, each Alternate Lender severally agrees, on any Business Day during
the Availability Period, to make Loans to Borrower or any Qualified Borrower at
any time and from time to time in an aggregate principal amount up to such
Lender’s Commitment at any such time; provided, however, that, after making such
Loans:  (a) such Lender’s Pro Rata Share of the Principal Obligation would not
exceed such Lender’s Commitment as of such date; and (b) the Principal
Obligation of such Lender’s Lender Group would not exceed the aggregate
Commitment of the Alternate Lenders in such Lender Group.  Subject to the
foregoing limitation, the conditions set forth in Section 8 and the other terms
and conditions hereof, Borrower or any Qualified Borrower may borrow, repay
without penalty or premium, and re-borrow hereunder, during the Availability
Period.  Each Borrowing pursuant to this Section 2.2 shall be funded ratably by
each Lender Group in accordance with its Lender Group Percentage.  No Lender
shall be obligated to fund any Loan if the interest rate applicable thereto
under Section 2.11 hereof would exceed the Maximum Rate in effect with respect
to such Loan.
 
2.3. Borrowing Procedures.
 
(a) Loan Notice.  The applicable Borrower Party may request a Loan hereunder by
delivering to Administrative Agent, by electronic mail, facsimile or by
telephone notice followed by the written confirmation via electronic mail or
other evidence of writing, a Loan Notice, appropriately completed and signed by
a Responsible Officer of such Borrower Party (and each Loan Notice submitted by
a Qualified Borrower must be countersigned by a Responsible Officer of
Borrower), no later than 11:00 a.m. at least two (2) Business Days prior to the
proposed date of any Loan (including the initial Loan).  Each such Loan Notice
shall specify:  (i) the desired amount of such Loan, which shall be (a) at least
$500,000 at all times when there is only one Alternate Lender party hereto, and
(b) at least $1,000,000 at all times when there are two or more Alternate
Lenders party hereto; (ii) the desired date of such Loan (the “Loan Date”),
which shall be a Business Day; and (iii) such other information as is required
by the form of such Loan Notice. Each Loan Notice submitted by such Borrower
Party shall be deemed to constitute a representation and warranty by the
applicable Borrower Party that: (i) the representations and warranties set forth
in Section 9 hereof are true and correct in all material respects on and as of
the date of such Loan Notice, with the same force and effect as if made on and
as of such date (except to the extent of changes in facts or circumstances that
have been disclosed to the Administrative Agent and do not constitute an Event
of Default or a Potential Default under this Credit Agreement or any other Loan
Document); (ii) no Event of Default or, to its knowledge, Potential Default
exists and is continuing at such date; (iii) the conditions specified in
Sections 8.1, 8.2 (if applicable) and 8.3, have been or will be satisfied as of
the Loan Date; and (iv) after giving effect to such Borrowing, the Principal
Obligation will not exceed the Available Loan Amount as of such date. No Loan
Notice shall be valid hereunder for any purpose unless it shall have been
accompanied or preceded by the information and other documents required to be
delivered in accordance with this Section 2.3.  All Loans hereunder shall be
made by each Lender Group on a pro rata basis based on the Lender Group
Percentage of each Lender Group.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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(b) Further Information.  Each Loan Notice shall be accompanied or preceded by:
(A) a Borrowing Base Certificate dated the date of such Loan Notice; and (B)
such documents as are required to satisfy any applicable conditions precedent as
provided in Section 8.2.
 
(c) Notification of Conduit Lender.  Administrative Agent will promptly notify
each Managing Agent of Administrative Agent’s receipt of any Loan Notice, and
each Managing Agent will promptly notify each of the Lenders in its Lender
Group.  If the Loan Notice is received prior to the Conduit Investment
Termination Date for a Conduit Lender, such Conduit Lender (or its Administrator
on its behalf) shall instruct Administrative Agent to accept or reject such Loan
Notice by notice given to Administrative Agent and the applicable Borrower Party
by telephone or facsimile by no later than the close of its business on the
later of the Business Day of its receipt of any such Loan Notice or the Business
Day prior to the applicable Loan Date.
 
(d) Loan Notice Irrevocable. Each Loan Notice shall be irrevocable and binding
on such Borrower and any applicable Qualified Borrower, and Borrower (and, if
applicable, the Qualified Borrower) shall indemnify Lenders against any cost,
loss, or expense incurred by Lenders, or any of them, as a result of any failure
to fulfill, on or before the date specified in the Loan Notice, the conditions
to such Borrowing set forth herein, including, without limitation, any cost,
loss, or expense incurred by reason of the liquidation or redeployment of the
deposits or other funds acquired by Lenders, or any of them, to fund the
Borrowing to be made by Lenders as a part of such Borrowing when such Borrowing,
as a result of such failure, is not made on such date (including, in the case of
a Conduit Lender, pursuant to a Program Support Agreement), except with respect
to a Borrowing for a Loan at the Base Rate, as to which Borrower shall not be
required to indemnify Lenders against such costs, losses or expenses incurred by
Lenders as a result of such liquidation or redeployment of funds.  A certificate
of Administrative Agent setting forth the amount of any such cost, loss or
expense, and the basis for the determination thereof and the calculation
thereof, shall be delivered to Borrower and the applicable Qualified Borrower
and shall, in the absence of a manifest error, be conclusive and binding
 
(e) Alternate Lender’s Commitment.  At no time will any Conduit Lender have any
obligation to fund a Loan or participate in any Letter of Credit.  At all times
on and after the Conduit Investment Termination Date for a Conduit Lender or if
a Conduit Lender has failed for whatever reason to fund its portion of a
Borrowing in full, all Loans and participations in Letters of Credit shall be
made by the Alternate Lenders of the related Lender Group.  At any time when a
Conduit Lender has rejected a request for Loan (it being understood that if a
Conduit Lender does not fund any Loan in relation to which all of the conditions
precedent set forth in Section 8.2 (if applicable) and Section 8.3 have been
satisfied on the date set forth in the applicable Loan Notice, such Conduit
Lender shall be deemed to have rejected the request for Loan), the related
Managing Agent shall so notify the related Alternate Lenders and such Alternate
Lenders shall make such Loan, on a pro rata basis, in accordance with their
respective Alternate Lender Pro Rata Shares.  Notwithstanding anything contained
in this Section 2.3(e) or elsewhere in this Credit Agreement to the contrary, no
Alternate Lender shall be obligated to provide Administrative Agent or any
Borrower Party with funds in connection with a Loan in an amount that would
result in the sum of the portion of the Loans then funded by it plus such
Alternate Lender’s Alternate Lender Pro Rata Share of the applicable Lender
Group Percentage of the Letter of Credit Liability exceeding its Commitment then
in effect (minus the unrecovered principal amount of such Alternate Lender’s
investments in the Principal Obligation pursuant to the Program Support
Agreement to which it is a party).  The obligation of each Alternate Lender to
remit its Alternate Lender Pro Rata Share of any such Loan requested of its
Lender Group shall be several from that of each other Alternate Lender, and the
failure of any Alternate Lender to so make such amount available to
Administrative Agent shall not relieve any other Alternate Lender of its
obligation hereunder.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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(f) Payment of Loan. On any Loan Date, each Conduit Lender or each Alternate
Lender, as the case may be, shall remit its share of the aggregate amount of
such Loan to Administrative Agent, by wire transfer of immediately available
funds to Administrative Agent for the account of the appropriate Borrower Party
no later than 12:00 noon.  Administrative Agent shall in turn forward the same
in immediately available funds to the appropriate Borrower Party’s account at
Administrative Agent specified in the Loan Notice, or, if requested by the
applicable Borrower Party in the Loan Notice, wire transfer such funds as
requested.
 
(g) Managing Agents May Advance Funds.  Unless a Managing Agent shall have
received notice from any Lender in its Lender Group that such Person will not
make its share of any Loan available on the applicable Loan Date therefor (for
purposes of this paragraph only, the “Loan Amount”), such Managing Agent may
(but shall have no obligation to) make any such Lender’s share of any such Loan
available to the applicable Borrower Party in anticipation of the receipt by
such Managing Agent of such Loan Amount from the applicable Lender.  To the
extent any such Lender fails to remit such Loan Amount to such Managing Agent
after any such advance by such Managing Agent on such Loan Date, such Lender
shall be required to pay such Loan Amount for its own account, together with
interest thereon at a per annum rate equal to the Federal Funds Rate to such
Managing Agent upon its demand therefor.  If such Lender does not pay such Loan
Amount together with such interest, such Managing Agent will promptly notify the
Borrower, and Borrower shall immediately pay such Loan Amount to Administrative
Agent (for distribution to the applicable Managing Agent), together with
interest thereon from the applicable Loan Date through the date such Loan Amount
is repaid to Administrative Agent promptly on demand, to the extent such funds
are available in the Collateral Account; and otherwise, to the extent that it is
necessary for Borrower to issue Call Notices to fund such required payment,
within fifteen (15) Business Days after Administrative Agent’s demand (but, in
any event, the Credit Parties shall issue such Call Notices and shall make such
payment promptly after the related Capital Contributions are received); or
(ii) from any Qualified Borrower (as applicable), promptly on demand; in each
case, together with interest at a rate per annum equal to the rate applicable to
the requested Borrowing for the period commencing on the borrowing date and
ending on (but excluding) the date Administrative Agent recovers the amount from
Borrower.  Until such amount shall be repaid, such amount shall be deemed to be
a Loan funded by the applicable Managing Agent and such Managing Agent shall be
deemed to be the owner of such Loan.  Upon the payment of such amount to
Administrative Agent by such Lender, such payment shall constitute such Person’s
payment of its share of the applicable Loan.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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(h) Defaulting Alternate Lender.  If, by 2:00 p.m. on any Loan Date or
Assignment Date, as applicable, whether or not any Managing Agent has advanced
the amount of the applicable Loan or paid the applicable Assignment Amount, one
or more Alternate Lenders in a Lender Group (each, a “Defaulting Alternate
Lender”, and each Alternate Lender other than any Defaulting Alternate Lender
being referred to as a “Non-Defaulting Alternate Lender”) fails to make its
share of any Loan available to Administrative Agent pursuant to Section 2.3(f)
or any Assignment Amount payable by it pursuant to Section 7.1 (the aggregate
amount not so made available to Administrative Agent being herein called in
either case the “Loan Deficit”), then such Alternate Lender’s Managing Agent
shall, by no later than 2:30 p.m. on the applicable Loan Date or the applicable
Assignment Date, as the case may be, instruct each Non-Defaulting Alternate
Lender in such Lender Group to pay, by no later than 3:00 p.m. on such date, in
immediately available funds, to the account designated by Administrative Agent,
an amount equal to the lesser of: (i) such Non-Defaulting Alternate Lender’s
proportionate share (based upon the relative Commitments of the Non-Defaulting
Alternate Lenders) of the Loan Deficit with respect to such Lender Group; and
(ii) its unused Commitment.  A Defaulting Alternate Lender shall forthwith, upon
demand, pay to its related Managing Agent for the ratable benefit of the
Non-Defaulting Alternate Lenders all amounts paid by each Non-Defaulting
Alternate Lender on behalf of such Defaulting Alternate Lender, together with
interest thereon, for each day from the date a payment was made by a
Non-Defaulting Alternate Lender until the date such Non Defaulting Alternate
Lender has been paid such amounts in full, at a rate per annum equal to the
Default Rate.  In addition, if, after giving effect to the provisions of the
immediately preceding sentence, any Loan Deficit with respect to any Assignment
Amount continues to exist, each such Defaulting Alternate Lender shall pay
interest to the related Managing Agent, for the account of the related Conduit
Lender, on such Defaulting Alternate Lender’s portion of such remaining Loan
Deficit, at a rate per annum, equal to the Default Rate, for each day from the
applicable Assignment Date until the date such Defaulting Alternate Lender shall
pay its portion of such remaining Loan Deficit in full to such Conduit Lender.
 
(i) Intent to Fund.  Subject to Section 2.4, each Conduit Lender confirms with
Borrower that it intends to fund all Loans hereunder through the issuance of its
Commercial Paper to the extent reasonably available prior to the occurrence of
an Event of Default or Potential Default.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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2.4. Determination of Yield and Interest Periods.  For purposes of determining
the Interest Period applicable to each Loan and of calculating Yield with
respect thereto, each applicable Managing Agent shall allocate the Loans of the
Lenders in its Lender Group to tranches (each a “Portion of Loan”).  Any Portion
of Loan funded by a Conduit Lender may from time to time be funded through the
issuance of Commercial Paper or pursuant to a Program Support Agreement, in the
sole discretion of such Conduit Lender.  Any Portion of Loan funded by the
Alternate Lenders or the applicable Program Support Providers shall accrue Yield
at the Alternate Rate or Base Rate, as selected by the Borrower.  Any Portion of
Loan funded by the Conduit Lenders through the issuance of Commercial Paper
shall accrue Yield at the applicable CP Rate.  At any time, each Portion of Loan
shall have only one Interest Period and one Rate Type.  The aggregate Portions
of Loans of each Lender Group at all times shall be equal to the Loans of such
Lender Group, and at any time when the Loans are not divided into two or more
portions, the term “Portion of Loans” shall mean 100% of the Loans of such
Lender Group.
 
2.5. Letters of Credit.
 
(a) Letter of Credit Commitment.
 
(i) Subject to the terms and conditions hereof, on any Business Day during the
Availability Period: (A) the Letter of Credit Issuer agrees, in reliance upon
the agreements of the Lenders set forth in this Section 2.5: (1) from time to
time on any Business Day during the period from the Closing Date until the
Letter of Credit Expiration Date, to issue Letters of Credit denominated in
Dollars for the account of a Borrower Party, in aggregate face amounts that
shall be not less than $500,000 (provided, however, three (3) Letters of Credit
for amounts less than $500,000 may be issued each calendar year), as a Borrower
Party may request, and to amend or extend Letters of Credit previously issued by
it; and (2) to honor drawings under the Letters of Credit; and (B) the Alternate
Lenders severally agree to participate in Letters of Credit issued for the
account of a Borrower Party and any drawings thereunder; provided that after
giving effect to an issuance of a Letter of Credit; (1) the Principal Obligation
will not exceed the Available Loan Amount on such date; (2) no Implicit
Borrowing Base Deficit shall exist and (3) the Letter of Credit Liability will
not exceed the Letter of Credit Sublimit.  Within the foregoing limits, and
subject to the terms and conditions hereof, a Borrower Party’s ability to obtain
Letters of Credit shall be fully revolving, and accordingly a Borrower Party
may, during the foregoing period, obtain Letters of Credit to replace Letters of
Credit that have expired or that have been drawn upon and reimbursed.  The
Letter of Credit Issuer shall have the right to approve the form of Letter of
Credit requested.
 
(ii) The Letter of Credit Issuer shall not issue or extend any Letter of Credit,
if: (A) subject to Section 2.5(b)(iii), the expiration date of such Letter of
Credit would occur more than twelve (12) months after the date of issuance or
last extension, unless the Letter of Credit Issuer has approved such expiry date
in its sole discretion; or (B) the expiration date of such Letter of Credit
would occur after the date fifteen (15) Business Days prior to the Stated
Maturity Date, unless the Borrower or applicable Qualified Borrower shall Cash
Collateralize the then-outstanding Letter of Credit Liability in respect of such
Letter of Credit fifteen (15) Business Days prior to the then-applicable Stated
Maturity Date, and such Letter of Credit has an expiration date that is not
later than twelve (12) months following the Stated Maturity Date.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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(iii) The Letter of Credit Issuer shall be under no obligation to issue any
Letter of Credit if: (A) any order, judgment or decree of any Governmental
Authority or arbitrator shall by its terms purport to enjoin or restrain the
Letter of Credit Issuer from issuing such Letter of Credit, or any Law
applicable to the Letter of Credit Issuer or any request or directive (whether
or not having the force of law) from any Governmental Authority with
jurisdiction over the Letter of Credit Issuer shall prohibit, or request that
the Letter of Credit Issuer refrain from, the issuance of letters of credit
generally or such Letter of Credit in particular or shall impose upon the Letter
of Credit Issuer with respect to such Letter of Credit any restriction, reserve
or capital requirement (for which the Letter of Credit Issuer is not otherwise
compensated hereunder) not in effect on the Closing Date, or shall impose upon
the Letter of Credit Issuer any unreimbursed loss, cost or expense which was not
applicable on the Closing Date and which the Letter of Credit Issuer in good
faith deems material to it; (B) the issuance of such Letter of Credit would
violate any Laws or one or more policies of the Letter of Credit Issuer;
(C) such Letter of Credit is to be denominated in a currency other than Dollars;
(D) such Letter of Credit contains any provisions for automatic reinstatement of
the stated amount after any drawing thereunder; or (E) a default of any Lender’s
obligations to fund hereunder exists or any Lender is at such time a Defaulting
Alternate Lender hereunder, unless the Letter of Credit Issuer has entered into
satisfactory arrangements with the Borrower Parties or such Lender to eliminate
the Letter of Credit Issuer’s risk with respect to such Lender.
 
(iv) The Letter of Credit Issuer shall be under no obligation to amend any
Letter of Credit if: (A) the Letter of Credit Issuer would have no obligation at
such time to issue such Letter of Credit in its amended form under the terms
hereof; or (B) the beneficiary of such Letter of Credit does not accept the
proposed amendment to such Letter of Credit.
 
(b) Procedures for Issuance and Amendment of Letters of Credit; Auto-Extension
Letters of Credit.
 
(i) Each Letter of Credit shall be issued or amended, as the case may be, upon
the request of a Borrower Party delivered to the Letter of Credit Issuer (with a
copy to Administrative Agent) in the form of a Request for Letter of Credit and
an Application and Agreement for Letter of Credit, together with a Borrowing
Base Certificate, each appropriately completed and signed by a Responsible
Officer of such Borrower Party.  Such Request for Letter of Credit must be
received by the Letter of Credit Issuer and Administrative Agent not later than
11:00 a.m. at least two (2) Business Days prior to the proposed issuance date or
date of amendment, as the case may be, of any Letter of Credit (or such later
date and time as Administrative Agent and the Letter of Credit Issuer may agree
in a particular instance in their sole discretion).  In the case of a request
for an initial issuance of a Letter of Credit, such Request for Letter of Credit
shall specify in form and detail satisfactory to the Letter of Credit Issuer:
(A) the proposed issuance date of the requested Letter of Credit (which shall be
a Business Day); (B) the amount thereof; (C) the expiry date thereof; (D) the
name and address of the beneficiary thereof; (E) the documents to be presented
by such beneficiary in case of any drawing thereunder; (F) the full text of any
certificate to be presented by such beneficiary in case of any drawing
thereunder; and (G) such other matters as the Letter of Credit Issuer may
reasonably require.  In the case of a request for an amendment of any
outstanding Letter of Credit, the related Request for Letter of Credit shall
specify in form and detail satisfactory to the Letter of Credit Issuer: (1) the
Letter of Credit to be amended; (2) the proposed date of amendment thereof
(which shall be a Business Day); (3) the nature of the proposed amendment; and
(4) such other matters as the Letter of Credit Issuer may reasonably
require.  Additionally, the applicable Borrower Party shall furnish to the
Letter of Credit Issuer and Administrative Agent such other documents and
information pertaining to such requested Letter of Credit issuance or amendment,
including any Issuer Documents, as the Letter of Credit Issuer or Administrative
Agent may reasonably require.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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(ii) Promptly after receipt of any Request for Letter of Credit, the Letter of
Credit Issuer will confirm with Administrative Agent (by telephone or in
writing) that Administrative Agent has received a copy of such Request for
Letter of Credit from a Borrower Party and, if not, the Letter of Credit Issuer
will provide Administrative Agent with a copy thereof.  The Letter of Credit
Issuer shall also promptly notify each Managing Agent (which in turn shall
promptly notify each Lender in its Lender Group) of the Request for Letter of
Credit and the terms thereof.  Unless the Letter of Credit Issuer has received
written notice from any Lender, Administrative Agent or any Borrower Party, at
least one (1) Business Day prior to the requested date of issuance or amendment
of the applicable Letter of Credit, that one or more applicable conditions
contained in Section 8 shall not then be satisfied, then, subject to the terms
and conditions hereof, the Letter of Credit Issuer shall, on the requested date,
issue a Letter of Credit for the account of such Borrower Party or enter into
the applicable amendment, as the case may be, in each case in accordance with
the Letter of Credit Issuer’s usual and customary business practices.
 
(iii) If a Borrower Party so requests in any applicable Request for Letter of
Credit, the Letter of Credit Issuer may, in its sole and absolute discretion,
agree to issue a Letter of Credit that has automatic extension provisions (each,
an “Auto-Extension Letter of Credit”); provided that any such Auto-Extension
Letter of Credit must permit the Letter of Credit Issuer to prevent any such
extension at least once in each twelve-month period (commencing with the date of
issuance of such Letter of Credit) by giving prior notice to the beneficiary
thereof not later than a Business Day (the “Non-Extension Notice Date”) in each
such twelve-month period to be agreed upon at the time such Letter of Credit is
issued.  Unless otherwise directed by the Letter of Credit Issuer, a Borrower
Party shall not be required to make a specific request to the Letter of Credit
Issuer for any such extension.  Once an Auto-Extension Letter of Credit has been
issued, the Lenders shall be deemed to have authorized (but may not require) the
Letter of Credit Issuer to permit the extension of such Letter of Credit at any
time to an expiry date not later than the Letter of Credit Expiration Date;
provided, however, that the Letter of Credit Issuer shall not permit any such
extension if: (A) the Letter of Credit Issuer has determined that it would not
be permitted, or would have no obligation, at such time to issue such Letter of
Credit in its revised form (as extended) under the terms hereof (by reason of
the provisions of clause (ii) or (iii) of Section 2.5(a) or otherwise); or
(B) it has received notice (which may be by telephone or in writing) on or
before the day that is five Business Days before the Non-Extension Notice Date:
(1) from Administrative Agent that the Required Lenders have elected not to
permit such extension; or (2) from Administrative Agent, any Lender or any
Borrower Party that one or more of the applicable conditions specified in
Section 8.2 and, if applicable, Section 8.3, is not then satisfied, and in each
such case directing the Letter of Credit Issuer not to permit such extension.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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(iv) Promptly after its delivery of any Letter of Credit or any amendment to a
Letter of Credit to an advising bank with respect thereto or to the beneficiary
thereof, the Letter of Credit Issuer will also deliver to the applicable
Borrower Party and Administrative Agent and each Managing Agent a true and
complete copy of such Letter of Credit or amendment.
 
(v) Whenever the Letter of Credit Issuer issues a Letter of Credit, each
Alternate Lender shall, automatically and without further action of any kind
upon the effective date of issuance of such Letter of Credit, have irrevocably
(i) agreed to acquire a participation interest therein in an amount equal to its
Alternate Lender Pro Rata Share of its Lender Group Percentage of the Letter of
Credit Liability attributable to such Letter of Credit and (ii) committed to
make a Loan hereunder equal to its Alternate Lender Pro Rata Share of its Lender
Group Percentage of the applicable reimbursement amount in the event that such
Letter of Credit is subsequently drawn and such drawn amount shall not have been
reimbursed by a Borrower Party upon such draw or a Loan with respect to such
unreimbursed draw is not made by such Alternate Lender’s related Conduit
Lender.  In the event that any Letter of Credit expires or is surrendered to the
Letter of Credit Issuer without being drawn (in whole or in part) then, in such
event, the foregoing commitment to make Loans with respect to draws under such
Letter of Credit shall expire with respect to such Letter of Credit and the
Letter of Credit Liability shall automatically reduce by the amount of the
Letter of Credit which is no longer outstanding.  Each Lender shall share in all
rights and obligations resulting therefrom, in accordance with such
participation interest, including, without limitation: (i) the right to receive
from Administrative Agent its share of any reimbursement of the amount of each
draft drawn under each Letter of Credit, including any interest payable with
respect thereto; (ii) the right to receive from the Letter of Credit Issuer its
share of the Letter of Credit Fees pursuant to Section 2.10 hereof; (iii) the
right to receive from the Letter of Credit Issuer its additional costs pursuant
to Section 4 hereof; and (iv) the obligation to reimburse Administrative Agent
in the form of a Loan to the applicable Borrower Party hereunder upon receipt of
notice of any payment by the Letter of Credit Issuer.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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(c) Drawings and Reimbursements; Funding of Participation.
 
(i) Upon receipt from the beneficiary of any Letter of Credit of any notice of a
drawing under such Letter of Credit, the Letter of Credit Issuer shall notify
the applicable Borrower Party and Administrative Agent thereof.  Not later than
11:00 a.m. on the date of any payment by the Letter of Credit Issuer under a
Letter of Credit (each such date, an “Honor Date”), the applicable Borrower
Party shall reimburse the Letter of Credit Issuer through the Administrative
Agent in an amount equal to the amount of such drawing.  If a Borrower Party
fails to so reimburse the Letter of Credit Issuer by such time, the
Administrative Agent shall promptly notify each Managing Agent of the Honor
Date, the amount of the unreimbursed drawing (the “Unreimbursed Amount”), and
the amount of such Lender Group’s Lender Group Percentage thereof.  Each such
notice by the Letter of Credit Issuer shall be treated as a Loan Notice by the
applicable Borrower Party.  In such event, the applicable Borrower Party shall
be deemed to have requested a Borrowing to be disbursed on the Honor Date in an
amount equal to the Unreimbursed Amount, without regard to the minimum and
multiples specified in Section 2.3, but subject to the amount of the unutilized
portion of the Available Loan Amount and the conditions set forth in
Section 8.2, if applicable, and Section 8.3 (other than the delivery of a Loan
Notice).  Any notice given by the Letter of Credit Issuer or Administrative
Agent pursuant to this Section 2.5(c)(i) may be given by telephone if
immediately confirmed in writing; provided that the lack of such an immediate
confirmation shall not affect the conclusiveness or binding effect of such
notice.
 
(ii) If the Letter of Credit Issuer so notifies a Managing Agent prior to 11:00
a.m. on any Business Day, such Managing Agent’s related Lender Group shall make
available to Administrative Agent, for the account of the Letter of Credit
Issuer, its Lender Group Percentage of the Unreimbursed Amount by 4:30 p.m. on
such Business Day (or a subsequent day specified by Administrative Agent) in
immediately available funds.  If the Letter of Credit Issuer so notifies a
Managing Agent after 11:00 a.m. on any Business Day, such Managing Agent’s
related Lender Group shall make available to Administrative Agent for the
account of the Letter of Credit Issuer its Lender Group Percentage of the
Unreimbursed Amount by 12:00 noon on the next Business Day (or a subsequent day
specified by Administrative Agent) in immediately available funds.  If any
amounts have been deposited into a segregated interest-bearing cash collateral
account for the purpose of Cash Collateralizing the Letter of Credit Liability,
the Letter of Credit Issuer shall use such funds to satisfy any drawings under
the Letters of Credit prior to notifying the Managing Agents of the need for a
Loan with respect thereto.  Lenders may conclusively rely on the Letter of
Credit Issuer as to the amount due Administrative Agent by reason of any draft
of a Letter of Credit or due the Letter of Credit Issuer under any Application
and Agreement for Letter of Credit.  If any payment received by Administrative
Agent pursuant to this Section 2.5(c) is required to be returned under any of
the circumstances described in Section 14.4, each Alternate Lender shall pay to
Administrative Agent for the account of the Letter of Credit Issuer its
Alternate Lender Pro Rata Share of the related Lender Group Percentage thereof
on demand of Administrative Agent, plus interest thereon from the date of such
demand to the date such amount is returned by such Lender, at a rate per annum
equal to the Federal Funds Rate from time to time in effect.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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(iii) With respect to any Unreimbursed Amount that is not fully refinanced by a
Borrowing because the conditions set forth in Section 8.2, if applicable, and
Section 8.3, cannot be satisfied or for any other reason, the applicable
Borrower Party shall be deemed to have incurred from the Letter of Credit Issuer
an L/C Borrowing in the amount of the Unreimbursed Amount that is not so
refinanced, which L/C Borrowing shall be due and payable on demand (together
with interest) and shall bear interest at the Default Rate.  In such event, each
Lender Group’s payment to Administrative Agent for the account of the Letter of
Credit Issuer pursuant to Section 2.5(c)(i) shall be deemed payment in respect
of its participation in such L/C Borrowing and shall constitute an L/C Advance
from the applicable Lenders in such Lender Group in satisfaction of its
participation obligation under this Section 2.5.
 
(iv) Until each applicable Lender in each Lender Group funds its Loan or L/C
Advance pursuant to this Section 2.5(c) to reimburse the Letter of Credit Issuer
for any amount drawn under any Letter of Credit, interest in respect of such
Lender Group’s Lender Group Percentage of such amount shall be solely for the
account of the Letter of Credit Issuer.
 
(v) Each Alternate Lender’s obligation to make Loans or L/C Advances to
reimburse the Letter of Credit Issuer for amounts drawn under Letters of Credit,
as contemplated by this Section 2.5(c), shall be absolute and unconditional and
shall not be affected by any circumstance, including: (A) any set-off,
counterclaim, recoupment, defense or other right which such Lender may have
against the Letter of Credit Issuer, any Credit Party, or any other Person for
any reason whatsoever; (B) the occurrence or continuance of a Potential Default
or Event of Default; or (C) any other occurrence, event or condition, whether or
not similar to any of the foregoing; provided, however, that each Alternate
Lender’s obligation to make Loans pursuant to this Section 2.5(c) is subject to
the conditions set forth in Section 8.2, if applicable, and Section 8.3 (other
than delivery of a Loan Notice).  No such making of an L/C Advance shall relieve
or otherwise impair the obligations of any Credit Party to reimburse the Letter
of Credit Issuer for the amount of any payment made by the Letter of Credit
Issuer under any Letter of Credit, together with interest as provided herein.
 
(vi) If any Alternate Lender fails to make available to Administrative Agent for
the account of the Letter of Credit Issuer any amount required to be paid by
such Lender pursuant to the foregoing provisions of this Section 2.5(c) by the
time specified in Section 2.5(c)(ii), the Letter of Credit Issuer shall be
entitled to recover from such Alternate Lender (acting through Administrative
Agent), on demand, such amount with interest thereon for the period from the
date such payment is required to the date on which such payment is immediately
available to the Letter of Credit Issuer at a rate per annum equal to the
Federal Funds Rate from time to time in effect.  A certificate of the Letter of
Credit Issuer submitted to any Alternate Lender (through Administrative Agent)
with respect to any amounts owing under this clause (vi) shall be conclusive
absent manifest error.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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(d) Repayment of Participations.
 
(i) At any time after the Letter of Credit Issuer has made a payment under any
Letter of Credit and has received from any Lender such Lender’s L/C Advance in
respect of such payment in accordance with Section 2.5(c), if Administrative
Agent receives for the account of the Letter of Credit Issuer any payment in
respect of the related Unreimbursed Amount or interest thereon (whether directly
from Borrower or otherwise, including proceeds of cash collateral applied
thereto by Administrative Agent), Administrative Agent will distribute to such
Lender its Pro Rata Share thereof (appropriately adjusted, in the case of
interest payments, to reflect the period of time during which such Lender’s L/C
Advance was outstanding) in the same funds as those received by Administrative
Agent.
 
(ii) If any payment received by Administrative Agent for the account of the
Letter of Credit Issuer pursuant to Section 2.5(c)(i) is required to be returned
under any of the circumstances described in Section 14.4 (including pursuant to
any settlement entered into by the Letter of Credit Issuer in its discretion),
each Alternate Lender shall, and each Conduit Lender may (and if a Conduit
Lender does not, the Alternate Lenders in its Lender Group shall), pay to
Administrative Agent for the account of the Letter of Credit Issuer its Pro Rata
Share thereof on demand of Administrative Agent, plus interest thereon from the
date of such demand to the date such amount is returned by such Lender, at a
rate per annum equal to the Federal Funds Rate from time to time in effect.
 
(e) Obligations Absolute.  The obligations of the applicable Borrower Party to
reimburse the Letter of Credit Issuer for each drawing under each Letter of
Credit and to repay each L/C Borrowing shall be absolute, unconditional and
irrevocable, and shall be paid strictly in accordance with the terms of this
Credit Agreement under all circumstances, including the following:
 
(i) any lack of validity or enforceability of such Letter of Credit, this Credit
Agreement, or any other Loan Document;
 
(ii) the existence of any claim, counterclaim, set-off, defense or other right
that any Borrower Party may have at any time against any beneficiary or any
transferee of such Letter of Credit (or any Person for whom any such beneficiary
or any such transferee may be acting), the Letter of Credit Issuer or any other
Person, whether in connection with this Credit Agreement, the transactions
contemplated hereby or by such Letter of Credit or any agreement or instrument
relating thereto, or any unrelated transaction;
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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(iii) any draft, demand, certificate or other document presented under such
Letter of Credit proving to be forged, fraudulent, invalid or insufficient in
any respect or any statement therein being untrue or inaccurate in any respect;
or any loss or delay in the transmission or otherwise of any document required
in order to make a drawing under such Letter of Credit;
 
(iv) any payment by the Letter of Credit Issuer under such Letter of Credit
against presentation of a draft or certificate that does not strictly comply
with the terms of such Letter of Credit; or any payment made by the Letter of
Credit Issuer under such Letter of Credit to any Person purporting to be a
trustee in bankruptcy, debtor-in-possession, assignee for the benefit of
creditors, liquidator, receiver or other representative of or successor to any
beneficiary or any transferee of such Letter of Credit, including any arising in
connection with any proceeding under any Debtor Relief Law; or
 
(v) any other circumstance or happening whatsoever, whether or not similar to
any of the foregoing, including any other circumstance that might otherwise
constitute a defense available to, or a discharge of, any Borrower Party.
 
The applicable Borrower Party shall promptly examine a copy of each Letter of
Credit and each amendment thereto that is delivered to it and, in the event of
any claim of noncompliance with such Borrower Party’s instructions or other
irregularity, such Borrower Party will immediately notify the Letter of Credit
Issuer.  The applicable Borrower Party shall be conclusively deemed to have
waived any such claim against the Letter of Credit Issuer and its correspondents
unless such notice is given as aforesaid.
 
(f) Role of Letter of Credit Issuer.  Each Lender and each Borrower Party agree
that, in paying any drawing under a Letter of Credit, the Letter of Credit
Issuer shall not have any responsibility to obtain any document (other than any
sight draft, certificates and documents expressly required by the Letter of
Credit) or to ascertain or inquire as to the validity or accuracy of any such
document or the authority of the Person executing or delivering any such
document.  None of the Letter of Credit Issuer, any Agent-Related Person nor any
of the respective correspondents, participants or assignees of the Letter of
Credit Issuer shall be liable to any Lender for: (i) any action taken or omitted
in connection herewith at the request or with the approval of the Lenders or the
Required Lenders, as applicable; (ii) any action taken or omitted in the absence
of gross negligence or willful misconduct; or (iii) the due execution,
effectiveness, validity or enforceability of any document or instrument related
to any Letter of Credit or related Request for Letter of Credit.  Each Borrower
Party hereby assumes all risks of the acts or omissions of any beneficiary or
transferee with respect to its use of any Letter of Credit; provided, however,
that this assumption is not intended to, and shall not, preclude any Borrower
Party’s pursuing such rights and remedies as it may have against the beneficiary
or transferee at law or under any other agreement.  None of the Letter of Credit
Issuer, any Agent-Related Person, nor any of the respective correspondents,
participants or assignees of the Letter of Credit Issuer, shall be liable or
responsible for any of the matters described in clauses (i) through (v) of
Section 2.5(e); provided, however, that anything in such clauses to the contrary
notwithstanding, a Borrower Party may have a claim against the Letter of Credit
Issuer, and the Letter of Credit Issuer may be liable to such Borrower Party, to
the extent, but only to the extent, of any direct, as opposed to consequential
or exemplary, damages suffered by such Borrower Party which such Borrower Party
proves were caused by the Letter of Credit Issuer’s willful misconduct or gross
negligence or the Letter of Credit Issuer’s willful failure to pay under any
Letter of Credit after the presentation to it by the beneficiary of a sight
draft and certificate(s) strictly complying with the terms and conditions of a
Letter of Credit.  In furtherance and not in limitation of the foregoing, the
Letter of Credit Issuer may accept documents that appear on their face to be in
order, without responsibility for further investigation, regardless of any
notice or information to the contrary, and the Letter of Credit Issuer shall not
be responsible for the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign a Letter of Credit or the rights
or benefits thereunder or proceeds thereof, in whole or in part, which may prove
to be invalid or ineffective for any reason.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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(g) Cash Collateral.  Upon the request of Administrative Agent if: (A) the
Letter of Credit Issuer has honored any full or partial drawing request under
any Letter of Credit and such drawing has resulted in an L/C Borrowing; or (B)
an Event of Default has occurred and is continuing; or (C) as of the Letter of
Credit Expiration Date, any Letter of Credit for any reason remains outstanding
and partially or wholly undrawn, then the Borrower Parties shall immediately
Cash Collateralize the then-outstanding amount of the Letter of Credit Liability
(determined as of the date of the such Event of Default or Letter of Credit
Expiration Date, as the case may be).
 
(i) In addition, if Administrative Agent notifies the Borrower Parties at any
time that the outstanding amount of the Letter of Credit Liability at such time
exceeds 100% of the Letter of Credit Sublimit then in effect, then the Credit
Parties shall Cash Collateralize the Letter of Credit Liability in an amount
equal to the amount by which the outstanding amount of the Letter of Credit
Liability exceeds the Letter of Credit Sublimit: (A) promptly upon receipt of
such notice (but in no event later than two (2) Business Days thereafter), with
proceeds from a Borrowing hereunder, up to the Available Loan Amount at such
time; and (B) within fifteen (15) Business Days of receipt of such notice to the
extent that it is necessary for the Credit Parties to issue Call Notices to fund
such required payment (after giving effect to the preceding clause (A)) (and the
Credit Parties shall issue such Call Notices during such time, and shall prepay
such Loans or Cash Collateralize the Letter of Credit Liability, or both,
immediately after the Capital Contributions relating to such Call Notices are
received).
 
(ii) Sections 2.1(d)(ii) and 3.6 set forth certain additional requirements to
deliver cash collateral hereunder.  For purposes of this Section 2.5, and such
other Sections, “Cash Collateralize” means to pledge and deposit with or deliver
to Administrative Agent, for the benefit of the Letter of Credit Issuer and the
Lenders, as collateral for the Letter of Credit Liability, cash or deposit
account balances in Dollars pursuant to documentation in form and substance
satisfactory to Administrative Agent and the Letter of Credit Issuer (which
documents are hereby consented to by the Lenders).  Derivatives of such term
have corresponding meanings.  Each Borrower Party hereby grants to
Administrative Agent, for the benefit of the Letter of Credit Issuer and the
Lenders, a security interest in all such cash, deposit accounts and all balances
therein and all proceeds of the foregoing.  Cash Collateral shall be maintained
in blocked, interest bearing deposit accounts at Bank of America (provided that:
(x)  any interest accrued on any such deposit account shall be payable to
Borrower only upon the full and final payment of the Obligations; and (y) upon
the occurrence of an Event of Default, any such interest accrued to the date
thereof shall be applied as additional compensation to Lenders).
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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(h) Conflict with Issuer Documents.  In the event of any conflict between the
terms hereof and the terms of any Issuer Documents, the terms hereof shall
control.
 
(i) Applicability of ISP98.  Unless otherwise expressly agreed by the Letter of
Credit Issuer and a Borrower Party when a Letter of Credit is issued, the rules
of the ISP shall apply to each Letter of Credit.
 
2.6. Payment of Borrower Guaranty.  In consideration of Lenders’ agreement to
advance funds to a Qualified Borrower, to cause Letters of Credit to be issued
for the account of a Qualified Borrower, and to accept Borrower Guaranties in
support thereof, Borrower hereby authorizes, empowers, and directs the
Administrative Agent, for the benefit of itself and the other Secured Parties,
within the limits of the Available Loan Amount, to disburse directly to Lenders,
with notice to Borrower, in immediately available funds, an amount equal to the
amount due and owing under any Qualified Borrower Note or any Borrower Guaranty,
together with all interest, reasonable costs and expenses and fees due to
Lenders pursuant thereto, as a Borrowing hereunder, in the event Administrative
Agent shall have not received payment of such Obligation when
due.  Administrative Agent will promptly notify Borrower of any disbursement
made to Lenders pursuant to the terms hereof, provided that the failure to give
such notice shall not affect the validity of the disbursement. Any such
disbursement made by Administrative Agent to Lenders shall be deemed to be a
Loan, and Borrower shall be deemed to have given to Administrative Agent, in
accordance with the terms and conditions of Section 2.3(a), a Loan Notice with
respect thereto. Administrative Agent may conclusively rely on Lenders as to the
amount of any such Obligation due to Lenders, absent manifest error.
 
2.7. Use of Proceeds and Letters of Credit.  The proceeds of the Loans and the
Letters of Credit shall be used solely for the purposes permitted under the
Operating Agreement, the Stockholders Agreement and the Constituent Documents of
the Qualified Borrowers.  None of the Lenders, Agents or Administrative Agent
shall have any liability, obligation, or responsibility whatsoever with respect
to any Borrower Party’s use of the proceeds of the Loans or the Letters of
Credit, and none of the Lenders, Agents or Administrative Agent shall be
obligated to determine whether or not any Borrower Party’s use of the proceeds
of the Loans or the Letters of Credit are for purposes permitted under the
Operating Agreement, the Stockholders Agreement or such Constituent
Documents.  Nothing, including, without limitation, any Borrowing, or any
issuance of any Letter of Credit, or acceptance of any other document or
instrument, shall be construed as a representation or warranty, express or
implied, to any party by any Agent, Lender or the Administrative Agent as to
whether any investment by Borrower or any Qualified Borrower is permitted by the
terms of the Operating Agreement, the Stockholders Agreement or the Constituent
Documents of any Qualified Borrower.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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2.8. Administrative Agent and Arranger Fees.  Borrower shall pay to
Administrative Agent and Arranger fees in consideration of the arrangement of
the Commitments and administration of this Credit Agreement, which fees shall be
payable in amounts and on the dates agreed to between Borrower and
Administrative Agent in the Fee Letter.
 
2.9. Unused Facility Fee.  In addition to the payments provided for in Section 3
hereof, Borrower shall pay to Administrative Agent, for the account of each
Lender Group, in accordance with its Lender Group Percentage, an unused facility
fee on the daily amount of the Liquidity Commitment minus the daily amount of
the Principal Obligation at a rate per annum provided in the Fee Letter, payable
in arrears on each Settlement Date.  Borrower and Lenders acknowledge and agree
that unused fees payable hereunder are bona fide unused fees and are intended as
reasonable compensation to Lenders for committing to make funds available to
Borrower as described herein and for no other purposes.
 
2.10. Letter of Credit Fees.  The Borrower Parties shall pay letter of credit
fees (the “Letter of Credit Fees”) to the Letter of Credit Issuer and
Administrative Agent in the amounts and on the dates as set forth in the Fee
Letter.
 
2.11. Computation of Interest and Fees.  All computations of interest for Loans
calculated by reference to the Base Rate, when the Base Rate is determined by
Bank of America’s “prime rate” shall be made on the basis of a year of 365 or
366 days, as the case may be, and actual days elapsed.  All other computations
of fees and interest shall be made on the basis of a 360-day year and actual
days elapsed (which results in more fees or interest, as applicable, being paid
than if computed on the basis of a 365-day year).  Interest shall accrue on each
Loan from and including the day on which the Loan is made, and shall not accrue
on a Loan, or any portion thereof, for the day on which the Loan or such portion
is paid, provided that any Loan that is repaid on the same day on which it is
made shall, subject to Section 3.4, bear interest for one day.
 
2.12. Increase in the Facility Amount.
 
(a) Additional Increase.  Administrative Agent shall, at the request of Borrower
(not more than three (3) times), increase the Facility Amount to the amount
requested by Borrower by increasing the Commitment of the Alternate Lenders
(each, an “Increasing Lender”), subject to the following conditions:
 
(i) Borrower shall have delivered to Administrative Agent the Facility Increase
Request at least three (3) Business Days prior to the date of increase;
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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(ii) After giving effect to the increase in the Commitment of each Increasing
Lender, the aggregate amount of Alternate Lenders’ Commitments will not exceed
the Maximum Commitment;
 
(iii) Each increase in the aggregate amount of Alternate Lenders’ Commitments
shall be in a minimum amount of $50,000,000;
 
(iv) No Event of Default or Potential Default has occurred and is continuing or
would result from such increase in the Alternate Lenders’ Commitments; and
 
(v) Borrower shall have paid the applicable fees in accordance with the
applicable Fee Letter on or prior to the date of increase.
 
(b) Consent of Alternate Lenders.  Subject to the satisfaction of the conditions
for such an increase in this Section 2.12, each Alternate Lender agrees to
increase its Commitments pro rata in the event of an increase of the Facility
Amount pursuant to this Section 2.12.
 
(c) Amendments.  If Administrative Agent deems it advisable in its sole
discretion, Borrowers and each Lender agree to execute an amendment to this
Credit Agreement, in form and substance reasonably acceptable to Administrative
Agent and Borrower, to document an increase in the Facility Amount pursuant to
this Section 2.12.
 
3. PAYMENT OF OBLIGATIONS
 
3.1. Notes.  The Loans to be made by Lenders to Borrower hereunder shall be
evidenced by promissory notes of Borrower.  Each Note shall: (a) be in the
amount of the applicable aggregate Commitments of the applicable Lender Group;
(b) be payable to the order of the Managing Agent for such Lender Group;
(c) bear interest in accordance with the provisions hereof; (d) be in the form
of Exhibit B-1 attached hereto (with blanks appropriately completed in
conformity herewith); and (e) be made by the Borrower.  The Loans to be made by
Lenders to Qualified Borrowers hereunder shall be evidenced by a Qualified
Borrower Promissory Note of each such Qualified Borrower.  Each Qualified
Borrower Promissory Note shall: (a) be in the amount of the applicable aggregate
Loans of the applicable Lender Group to be advanced to such Qualified Borrower;
(b) be payable to the order of the Managing Agent for such Lender Group;
(c) bear interest in accordance with the provisions hereof; (d) be in the form
of Exhibit B-2 attached hereto (with blanks appropriately completed in
conformity herewith); and (e) be duly executed by such Qualified Borrower.  Each
Borrower Party agrees, from time to time, upon the request of Administrative
Agent or any applicable Managing Agent, to reissue new Notes, in accordance with
the terms and in the form heretofore provided, to any Lender and any Assignee of
such Lender in accordance with Section 14.12(b) hereof, in renewal of and
substitution for the Note previously issued by such Borrower Party to the
Managing Agent for the affected Lender Group, and such previously issued Notes
shall be returned to the applicable Borrower Party marked “cancelled”.  Each
Managing Agent shall, and is hereby authorized to, make a notation on the
schedule attached to the Note of the date and the amount of each Loan and the
date and amount of each payment of principal thereon, and prior to any transfer
of the Note, such Managing Agent shall endorse the outstanding principal amount
of the Note on the schedule attached thereto; provided, however, that failure to
make such notation shall not limit or otherwise affect the obligations of any
Borrower Party hereunder or under such Note to pay when due the aggregate unpaid
principal amount of Obligations owing to the applicable Lender Group by such
Borrower Party under this Credit Agreement, and to pay interest on the aggregate
unpaid principal amount of Obligations (as so adjusted) and to pay any other
amount owing hereunder or thereunder, in each case as provided herein.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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3.2. Payment of Obligations.  The principal amount of the Obligations
outstanding on the Maturity Date, together with all accrued but unpaid interest
thereon, shall be due and payable on the Maturity Date.
 
3.3. Payment of Interest.
 
(a) Interest.  Interest on each Borrowing and any portion thereof shall commence
to accrue in accordance with the terms of this Credit Agreement and the other
Loan Documents as of the date of the disbursal or wire transfer of such
Borrowing by Administrative Agent, consistent with the provisions of Section 2.4
and 2.11, notwithstanding whether any Borrower Party received the benefit of
such Borrowing as of such date and even if such Borrowing is held in escrow
pursuant to the terms of any escrow arrangement or agreement.  When a Borrowing
is disbursed by wire transfer pursuant to instructions received from a Borrower
Party, then such Borrowing shall be considered made at the time of the
transmission of the wire, in accordance with the Loan Notice, rather than the
time of receipt thereof by the receiving bank.  With regard to the repayment of
the Loans, interest shall continue to accrue on any amount repaid until such
time as the repayment has been received in federal or other immediately
available funds by Administrative Agent.
 
(b) Interest Payment Dates.  Accrued and unpaid interest (i) on the Obligations
shall be due and payable in arrears in Dollars on each Settlement Date and on
the Maturity Date, (ii) on each other date of any reduction of the Principal
Obligation hereunder, and (iii) with respect to any Obligation on which such
Borrower Party is in default shall be due and payable at any time and from time
to time following such default upon demand by Administrative Agent.  Interest
hereunder shall be due and payable in accordance with the terms hereof before
and after judgment, and before and after the commencement of any proceeding
under any Debtor Relief Law.
 
(c) Direct Disbursement.  If, at any time, Administrative Agent or Letter of
Credit Issuer shall not have received on the date due, any payment of interest
upon the Loans or any fee described herein, Administrative Agent may direct the
disbursement of funds from the Collateral Account to Lenders or Letter of Credit
Issuer, in accordance with the terms hereof, to the extent available therein for
payment of any such amount.  If, at any such time, the amount available in the
Collateral Account is not sufficient for the full payment of such amounts due,
Administrative Agent may, without prior notice to or the consent of any Borrower
Party, within the limits of the Available Loan Amount, disburse to Lenders, in
accordance with the terms hereof, in immediately available funds an amount equal
to the interest or fee due to Lenders, which disbursement shall be deemed to be
a Loan pursuant to Section 2.3 hereof, and Borrower shall be deemed to have
given to Lenders in accordance with the terms and conditions of Section 2.3 a
Loan Notice with respect thereto.
 
Revolving Credit Agreement
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3.4. Payments Generally.  (a) All payments of principal of, and interest on, the
Obligations under this Credit Agreement by any Borrower Party to or for the
account of Lenders, or any of them, shall be made without condition or deduction
for any counterclaim, defense, recoupment or setoff by such Borrower
Party.  Except as otherwise expressly provided herein, all payments by the
Borrower Parties hereunder shall be made to Administrative Agent, for the
account of the respective Lenders to which such payment is owed, to the
Administrative Agent’s Account in Dollars and in immediately available funds not
later than 2:00 p.m. on the date specified herein.  Funds received after 2:00
p.m. shall be treated for all purposes as having been received by Administrative
Agent on the first Business Day next following receipt of such funds and any
applicable interest or fees shall continue to accrue.  Each Lender Group shall
be entitled to receive its Lender Group Percentage (or other applicable share as
provided herein) of each payment received by Administrative Agent hereunder for
the account of Lenders on the Obligations.  Each payment received by
Administrative Agent hereunder for the account of a Lender Group shall be
promptly distributed by Administrative Agent in accordance with the instructions
provided by the Managing Agent for such Lender Group.  If any payment to be made
by any Borrower Party shall come due on a day other than a Business Day, payment
shall be made on the next following Business Day, and such extension of time
shall be reflected in computing interest or fees, as the case may be.
 
(b) Borrower Deposits.  The Borrower Parties shall deposit or cause to be
deposited into the Administrative Agent’s Account:
 
(i) On each Settlement Date, accrued and unpaid Yield for the applicable
Interest Period;
 
(ii) On the specified Business Day with respect to a reduction of the Principal
Obligation under Section 3.5 or Section 3.6, the amount of the reduction,
accrued and unpaid Yield thereon to such Business Day and any other Obligations
(other than Yield) with respect to such amount;
 
(iii) On each applicable Business Day determined in accordance with Section
2.1(d), an amount equal to the mandatory principal payment specified therein,
accrued and unpaid Yield thereon to such Business Day and any other Obligation
(other than Yield) with respect to such amount;
 
(iv) On each Settlement Date, any Obligations then due and payable other than
Yield (without duplication); and
 
(v) On the Maturity Date, all accrued and unpaid Obligations (including Cash
Collateralization of the Letter of Credit Liability that will remain outstanding
after the Maturity Date).
 
(c) Order of Application.  Upon the receipt by Administrative Agent of any
payment with respect to the Obligations, Administrative Agent shall distribute
the amount of such payment or deposit to the Persons, for the purposes and in
the order of priority, set forth below:
 
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Acadia Strategic Opportunity Fund III LLC
 
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(i) to Administrative Agent, the Managing Agents, the Administrator, the
applicable Lenders and such other Persons as may be entitled to the distribution
required by this clause (i), in payment of all costs, expenses, other fees
(including Attorney Costs) and  Obligations owed to such Persons other than
Loans and Yield and other than the Cash Collateralization of the Letter of
Credit Liability, pro rata based on entitlement;
 
(ii) to the applicable Managing Agents (on behalf of their related Lenders), pro
rata based on the Lender Group Percentages of their respective Lender Groups in
the Loans, accrued and unpaid Yield on all Portions of Loans for the related
Interest Periods; and
 
(iii) first, to the applicable Managing Agents (on behalf of their related
Lenders), pro rata based on the Lender Group Percentages of their respective
Lender Groups in the Loans, in reduction of the aggregate outstanding Loans, and
second, for deposit in the Administrative Agent’s Account an amount necessary to
Cash Collateralize the Letter of Credit Liability as required pursuant to
Section 2.5.
 
3.5. Voluntary Prepayments.  Any Borrower Party may, upon notice to
Administrative Agent, at any time or from time to time voluntarily prepay Loans
in whole or in part without premium or penalty; provided that: (a) such notice
must be received by Administrative Agent not later than 11:00 a.m. three (3)
Business Days prior to any date of prepayment of Loans; and (b) any prepayment
of Loans shall be in a principal amount of $500,000 or a whole multiple of
$100,000 in excess thereof or, if less, the entire principal amount thereof then
outstanding.  Each such notice shall specify the date (which shall be a Business
Day) and amount of such prepayment.  Administrative Agent will promptly notify
each Managing Agent of its receipt of each such notice, and of the amount of
such Managing Agent’s Lender Group Percentage of such prepayment.  If such
notice is given by a Borrower Party, such Borrower Party shall make such
prepayment and the payment amount specified in such notice shall be due and
payable on the date specified therein.  Any prepayment of a Loan shall be
accompanied by all accrued interest thereon, together with any additional
amounts required pursuant to Section 4 hereof.  Each such prepayment shall be
applied to the Obligations held by each Lender in accordance with its respective
Pro Rata Share.
 
3.6. Reduction or Early Termination of Commitments.  So long as no Loan Notice
or Request for Letter of Credit is outstanding, Borrower may terminate the
Commitments, or reduce the Facility Amount, by giving prior irrevocable written
notice to Administrative Agent of such termination or reduction ten (10)
Business Days prior to the effective date of such termination or reduction
(which date shall be specified by Borrower in such notice):  (a) (i) in the case
of complete termination of the Commitments, upon prepayment of all of the
outstanding Obligation, including, without limitation, all interest accrued
thereon, in accordance with the terms of Section 3.5; or (ii) in the case of a
reduction of the Facility Amount, upon prepayment of the amount by which the
Principal Obligation exceeds the reduced Available Loan Amount resulting from
such reduction, including, without limitation, payment of all interest accrued
thereon, in accordance with the terms of Section 3.5, provided, however, that,
except in connection with a termination of the Commitments, the Facility Amount
may not be reduced such that, upon such reduction, the Available Loan Amount is
less than the aggregate face amount of outstanding Letters of Credit; and (b) in
the case of the complete termination of the Commitments, if any Letter of Credit
Liability exists, Borrower shall immediately Cash Collateralize the
then-outstanding amount of the Letter of Credit Liability, without presentment,
demand, protest or any other notice of any kind, all of which are hereby
waived.  Unless otherwise required by law, upon the full and final payment of
the Letter of Credit Liability, or the termination of all outstanding Letter of
Credit Liability due to the expiration of all outstanding Letters of Credit
prior to draws thereon, Administrative Agent shall return to Borrower or the
applicable Qualified Borrower any amounts remaining in such cash collateral
account, provided, however, that, so long as no Event of Default exists, to the
extent individual Letters of Credit expire, Administrative Agent will return to
Borrower or the applicable Qualified Borrower the corresponding amount of the
expired Letter of Credit Liability.  Notwithstanding the foregoing:  (1) after
any reduction of the Facility Amount by Borrower, the next subsequent reduction
shall not occur until at least one month thereafter; (2) any reduction of the
Facility Amount shall be in an amount equal to or greater than $5,000,000; and
(3) in no event shall a reduction by Borrower reduce the Facility Amount to
$10,000,000 or less (except for a termination of all the Commitments).  Promptly
after receipt of any notice of reduction or termination, Administrative Agent
shall notify each Lender of the same.  Any reduction of the Facility Amount
shall reduce the Commitments of the Alternate Lenders on a pro rata basis.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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3.7. Lending Office.  Each Lender may (a) designate its principal office or a
branch, subsidiary or Affiliate of such Lender as its Lending Office (and the
office to whose accounts payments are to be credited) for any Loan and
(b) change its Lending Office from time to time by notice to Administrative
Agent and Borrower.  In such event, the Managing Agent for such Lender shall
continue to hold the Note, if any, evidencing its loans for the benefit and
account of such branch, subsidiary or Affiliate.  Each Lender shall be entitled
to fund all or any portion of its Commitment in any manner it deems appropriate,
consistent with the provisions of Section 2.4.
 
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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4. CHANGE IN CIRCUMSTANCES.
 
4.1. Taxes.
 
(a) Payments Free of Taxes.  Any and all payments by or on account of any
obligation of any Borrower Party hereunder or under any other Loan Document
shall be made free and clear of and without reduction or withholding for any
Indemnified Taxes or Other Taxes, provided that if any Borrower Party shall be
required by applicable law to deduct any Indemnified Taxes (including any Other
Taxes) from such payments, then: (i) the sum payable shall be increased as
necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this Section 4.1) each Tax
Indemnified Party receives an amount equal to the sum it would have received had
no such deductions been made; (ii) the applicable Borrower Party shall make such
deductions; and (iii) such Borrower Party shall timely pay the full amount
deducted to the relevant Governmental Authority in accordance with applicable
law.
 
(b) Payment of Other Taxes by Borrower.  Without limiting the provisions of
subsection (a) above, each Borrower Party shall timely pay any Other Taxes to
the relevant Governmental Authority in accordance with applicable law.
 
(c) Indemnification by Borrower Parties.  Each Borrower Party shall indemnify
each Tax Indemnified Party, within ten (10) days after demand therefor, for the
full amount of any Indemnified Taxes or Other Taxes (including Indemnified Taxes
or Other Taxes imposed or asserted on or attributable to amounts payable under
this Section 4.1) paid by such Tax Indemnified Party and penalties, interest and
reasonable expenses arising therefrom or with respect thereto, whether or not
such Indemnified Taxes or Other Taxes were correctly or legally imposed or
asserted by the relevant Governmental Authority.  A certificate as to the amount
of such payment or liability delivered to the applicable Borrower Party by a Tax
Indemnified Party (with a copy to Administrative Agent), on its own behalf or on
behalf of a Tax Indemnified Party, shall be conclusive absent manifest error.
 
(d) Evidence of Payments.  As soon as practicable after any payment of
Indemnified Taxes or Other Taxes by a Borrower Party to a Governmental
Authority, such Borrower Party shall deliver to Administrative Agent the
original or a certified copy of a receipt issued by such Governmental Authority
evidencing such payment, a copy of the return reporting such payment or other
evidence of such payment reasonably satisfactory to Administrative Agent.
 
(e) Gross Up.  If any Borrower Party shall be required to deduct or pay any
Taxes or Other Taxes from or in respect of any sum payable under any Loan
Document to Administrative Agent or any Secured Party, such Borrower Party shall
also pay to Administrative Agent or to such Secured Party, as the case may be,
at the time interest is paid, such additional amount that Administrative Agent
or such Secured Party specifies is necessary to preserve the after-tax yield
(after factoring in all taxes, including taxes imposed on or measured by net
income) that Administrative Agent or such Secured Party would have received if
such Taxes or Other Taxes had not been imposed.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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(f) Selection of Lending Office.  If a Borrower Party is or is likely to be
required to pay additional amounts to or for the account of any Lender pursuant
to this Section 4.1, then such Lender will agree to use reasonable efforts to
change the jurisdiction of its Lending Office so as to eliminate or reduce any
such additional payment which may thereafter accrue if such change, in the good
faith  judgment of such Lender, is not otherwise materially disadvantageous to
such Lender.
 
(g) Treatment of Certain Refunds.  If any Tax Indemnified Party determines, in
its reasonable discretion, that it has received a refund of any Taxes or Other
Taxes as to which it has been indemnified by the Borrower Parties or with
respect to which any Borrower Party has paid additional amounts pursuant to this
Section 4.1, it shall pay to such Borrower Party an amount equal to such refund
(but only to the extent of indemnity payments made, or additional amounts paid,
by such Borrower Party under this Section 4.1 with respect to the Taxes or Other
Taxes giving rise to such refund), net of all out-of-pocket expenses of such Tax
Indemnified Party, as the case may be, and without interest (other than any
interest paid by the relevant Governmental Authority with respect to such
refund); provided that each Borrower Party, upon the request of such Tax
Indemnified Party, agrees to repay the amount paid over to such Borrower Party
(plus any penalties, interest or other charges imposed by the relevant
Governmental Authority) to such Tax Indemnified Party in the event such Tax
Indemnified Party is required to repay such refund to such Governmental
Authority.  This subsection shall not be construed to require any Tax
Indemnified Party to make available its tax returns (or any other information
relating to its taxes that it deems confidential) to the Borrower Parties or any
other Person.
 
4.2. Illegality.  If any Lender determines that any Law has made it unlawful, or
that any Governmental Authority has asserted that it is unlawful, for such
Lender or its Lending Office to make, maintain, finance or fund Loans or other
Obligations, or to determine or charge interest rates based upon the LIBOR Rate,
or any Governmental Authority has imposed material restrictions on the authority
of such Lender to purchase or sell, or to take deposits of, Dollars or to
determine or charge interest rates based upon the LIBOR Rate, then, on notice
thereof by such Lender to Borrower Parties through Administrative Agent, any
obligation of such Lender to make or continue Loans or to convert Portions of
Loans accruing Yield calculated by reference to the LIBOR Rate to Portions of
Loans calculated by return to the Base Rate shall be suspended until such Lender
notifies Administrative Agent and Borrower Parties that the circumstances giving
rise to such determination no longer exist.  Upon the prepayment of any such
Loans, each Borrower Party shall also pay accrued interest on the amount so
prepaid.  Each Lender agrees to designate a different Lending Office if such
designation will avoid the need for such notice and will not, in the good faith
judgment of such Lender, otherwise be materially disadvantageous to such Lender.
 
4.3. Inability to Determine Rates.  If the LIBOR Rate is at any time applicable
and if Administrative Agent is unable to obtain on a timely basis the
information necessary to determine the LIBOR Rate for any proposed Interest
Period, then:  (a)  Administrative Agent shall forthwith notify the Lenders and
each Borrower Party that the LIBOR Rate cannot be determined for such Interest
Period; and (b) while such circumstances exist, none of the Managing Agents
shall allocate any Portion of Loans with respect to Loans made during such
period, or reallocate any Portion of Loans allocated to any then-existing
Interest Period ending during such period, to a Interest Period with respect to
which Yield is calculated by reference to the LIBOR Rate.  If, with respect to
any outstanding Interest Period, a Lender notifies the Administrative Agent that
it is unable to obtain matching deposits based upon the London interbank market
to fund its purchase or maintenance of such Portion of Loans or that the LIBOR
Rate applicable to such Portion of Loans will not adequately reflect the cost to
the Person of funding or maintaining such Portion of Loans for such Interest
Period, then:  (i) Administrative Agent shall forthwith so notify Borrower and
the Lenders; and (ii) upon such notice and thereafter while such circumstances
exist, the applicable Managing Agent shall not allocate any other Portion of
Loans with respect to Loans made by such Lender during such period, or
reallocate any Portion of Loans allocated to any Interest Period ending during
such period, to an Interest Period with respect to which Yield is calculated by
reference to the LIBOR Rate.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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4.4. Increased Cost and Capital Adequacy.
 
(a) Change in Law: Increased Cost.  If any Secured Party determines that as a
result of the introduction of or any change in or in the interpretation of any
Law, or such Secured Party’s compliance therewith, there shall be any increase
in the cost to such Secured Party of agreeing to make or making, funding or
maintaining Loans or (as the case may be) issuing or participating in Letters of
Credit (collectively, the “Covered Matters”), or its obligation to advance funds
under a Program Support Agreement or otherwise in respect of Covered Matters, or
a reduction in the amount received or receivable by such Secured Party in
connection with any of the foregoing (excluding for purposes of this clause (a)
any such increased costs or reduction in amount resulting from: (i) Taxes or
Other Taxes (as to which Section 4.1 shall govern); (ii) changes in the basis of
taxation of overall net income or overall gross income by the United States or
any foreign jurisdiction or any political subdivision of either thereof under
the Laws of which such Secured Party is organized or has its Lending Office; and
(iii) reserve requirements utilized in the determination of the LIBOR Rate),
then from time to time upon demand of such Secured Party (with a copy of such
demand to the Administrative Agent), the Borrower Parties shall pay to such
Secured Party such additional amounts as will compensate such Secured Party for
such increased cost or reduction:  (A) promptly on demand, to the extent that
funds are available in the Collateral Account or any other account maintained by
Borrower; and (B) otherwise, to the extent that it is necessary for Call Notices
to be issued to fund such required payment, within fifteen (15) Business Days
after demand (but in any event, the Credit Parties shall issue such Call Notices
and shall make such payment immediately after the related Capital Contributions
are received).
 
(b) Change in Law: Capital Adequacy.  If any Secured Party determines that the
introduction of any Law regarding capital adequacy or any change therein or in
the interpretation thereof, or compliance by such Secured Party (or its Lending
Office) therewith, has the effect of reducing the rate of return on the capital
of such Secured Party or any corporation controlling such Secured Party as a
consequence of Covered Matters or its obligation to advance funds under a
Program Support Agreement or otherwise in respect of Covered Matters (taking
into consideration its policies with respect to capital adequacy and such
Secured Party’s desired return on capital), then from time to time upon demand
of such Secured Party (with a copy of such demand to Administrative Agent), the
applicable Borrower Parties shall pay to such Secured Party such additional
amounts as will compensate such Secured Party for such reduction; provided,
however, that such amounts shall not be duplicative of any amounts paid by such
Borrower Party in the preceding clause (a): (A) promptly on demand, to the
extent that funds are available in the Collateral Account or any other account
maintained by such Borrower Party; and (B) otherwise, to the extent that it is
necessary for Call Notices to be issued to fund such required payment, within
fifteen (15) Business Days after demand (but in any event, the Credit Parties
shall issue such Call Notices and shall make such payment after the related
Capital Contributions are received).
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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4.5. Funding Losses.  Upon demand of any Lender (with a copy to Administrative
Agent) from time to time, the Borrower Parties shall promptly pay Administrative
Agent for the account of such Lender, such amount or amounts as shall compensate
such Lender for and hold such Lender harmless from any loss, cost or expense
incurred by such Lender (as determined by the applicable Managing Agent) as a
result of (i) any reduction of any Portion of Loans other than on a date for
which timely notice thereof was provided in accordance with Section 3.5 or (ii)
any failure by a Borrower Party (for a reason other than the failure of such
Lender to make a Loan) to pay, prepay or borrow any Loan on the date or in the
amount notified by such Borrower Party, or (iii) any failure by any Borrower
Party to make payment on any drawing under any Letter of Credit (or interest due
thereon) on its scheduled due date, and, in the case of an event described in
clause (i) or (ii) to include: (a) an amount equal to any loss or expense
suffered by the applicable Lender during the period from the date of receipt of
such repayment to the applicable Settlement Date (or if in respect of a
reduction on a Settlement Date but without the requisite notice required by
Section 3.5, to the maturity date of such Commercial Paper (or other financing
source)); and (b) net of the income, if any, actually received by the recipient
of such reduction from investing the proceeds of such reduction of such Portion
of Loans.
 
4.6. Matters Applicable to all Requests for Compensation.
 
(a) Determination of Amount.  A certificate of Administrative Agent or any
Secured Party provided to Borrower claiming compensation under this Section 4
and setting forth the additional amount or amounts to be paid to it hereunder
shall be conclusive in the absence of manifest error.  In determining such
amount, Administrative Agent or such Secured Party may use any reasonable
averaging and attribution methods.
 
(b) No Duplication.  Any amount payable by the Borrower on account of Section
4.1, 4.4, or 4.5 shall not be duplicative of: (i) any amount paid under any
other such sections, or (ii) any amounts included in the calculation of the
LIBOR Rate.  Notwithstanding anything to the contrary set forth in this Section
4, Borrower Parties shall be required to compensate the Lenders for amounts
payable pursuant to Sections 4.1, 4.4 and 4.5 only to the extent Lenders are
holding comparable borrowers liable for such amounts.
 
(c) Replacement of Lenders.  If any Lender requests compensation under
Section 4.4, or if any Borrower Party is required to pay any additional amount
to any Lender or any Governmental Authority for the account of any Lender
pursuant to Section 4.1, Borrower may replace such Lender in accordance with
Section 14.14.
 
Revolving Credit Agreement
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(d) Refund.  Any amount determined to be paid by the Borrower in error pursuant
to this Section 4 shall be, if no Event of Default has occurred and is
continuing, promptly refunded to the Borrower, or applied to amounts owing
hereunder, as the Borrower may elect.
 
(e) Survival.  All of the Borrower Parties’ obligations under this Section 4
shall survive the termination of the Commitments and payment in full of all
other Obligations hereunder.
 
4.7. Prohibited Event.  In the event a Lender notifies the Administrative Agent
that, subsequent to the Closing Date, such Lender or any of its Affiliates: (i)
has become a fiduciary with respect to any ERISA Investor in connection with its
investment in the Borrower, the Guarantor, the Pledgor or this transaction; or
(ii) has acquired any discretionary authority or control with respect to any
ERISA Investor’s investment in any Credit Party, or renders any investment
advice (within the meaning of 29 C.F.R. §2510.3-21(c)) with respect to such
investment, the parties hereby agree that the event described in clause (i) or
(ii) above (the “Prohibited Event”) shall be deemed to have caused a prohibited
transaction under Section 406(a) of ERISA or Section 4975(c)(1)(A), (B), (C) or
(D) of the Code with respect to the transactions described in this Credit
Agreement, and the parties to this Credit Agreement shall cooperate with each
other to correct such prohibited transaction in accordance with Section
4975(f)(5) of the Code.  NOTWITHSTANDING ANYTHING IN THIS CREDIT AGREEMENT TO
THE CONTRARY, any such correction shall prevent the Lender from receiving any
direct or indirect fees, loan repayments, or any other benefits from such ERISA
Investor.  If the Administrative Agent determines at any time in its reasonable
discretion that any of the corrections described herein are insufficient to
correct the prohibited transaction in accordance with Section 4975(f)(5) of the
Internal Revenue Code, then the parties shall also cooperate to replace such
affected Lender.
 
5. SECURITY
 
5.1. Liens and Security Interest.
 
(a) Capital Commitments and Capital Calls.  To secure performance by the
Borrower Parties of the payment of each Note and the Obligations:  (i) each of
Borrower and Managing Member shall grant to Administrative Agent, for the
benefit of each of the Secured Parties, an exclusive, perfected, first priority
security interest and Lien in and to the Collateral Account pursuant to the
Account Assignment; (ii) Borrower and Managing Member, to the extent of their
respective interests therein, shall grant to Administrative Agent, for the
benefit of Secured Parties, an exclusive, perfected, first priority security
interest and Lien in and to the Capital Calls, Capital Commitments, Capital
Contributions and their rights under the Operating Agreement, including, without
limitation, any rights to make Capital Calls, receive payment of Capital
Contributions and enforce the payment thereof pursuant to the Borrower and
Managing Member Security Agreement and (iii) pursuant to the Capital
Contributions Pledge Agreement, the Pledgor shall grant to Administrative Agent,
for the benefit of each Secured Party, an exclusive, perfected, first priority
security interest and Lien in all of the collateral described therein, including
the Capital Calls, Capital Commitments, Capital Contributions and, without
limitation, any rights to make Capital Calls, receive payment of Capital
Contributions and enforce the payment thereof with respect to the Stockholders
pursuant to the Stockholders Agreement (the collateral in clauses (i) through
(iii) of this Section 5.1(a) being, collectively, the “Collateral”); and
(v) Borrower, Managing Member and Pledgor shall deliver to Administrative Agent,
or shall otherwise consent to the filing of, financing statements and other
documents satisfactory to Administrative Agent.  Administrative Agent
acknowledges that the collateral for the Obligations does not include a security
interest in any Equity Interest.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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(b) Investor Letters.  Each Investor  shall execute, in favor of Administrative
Agent for the benefit of Secured Parties, an agreement in substantially the form
attached hereto as Exhibit I (an “Investor Letter”).
 
5.2. Collateral Account; Capital Calls.
 
(a) Collateral Account.  In order to secure further the payment and performance
of the Obligations and to effect and facilitate Secured Parties’ right of
offset:  (i) the Credit Parties hereby irrevocably appoints Administrative Agent
as subscription agent and the sole party entitled in the name of the applicable
Credit Party upon the occurrence and during the continuance of an Event of
Default, to make any Capital Calls upon the Investors pursuant to the terms of
the Operating Agreement and/or the Stockholders Agreement, as applicable, and
shall require that all Investors wire-transfer to Bank of America, N.A., ABA
#026-009-593, for further credit to Account No. 1233060441, reference “Acadia
Strategic Opportunity Fund III LLC Collateral Account” (the “Collateral
Account”), all monies or sums paid or to be paid by any Investor to the capital
of any Credit Party as Capital Contributions as and when Capital Contributions
are called pursuant to the Call Notices.  In addition, each Credit Party shall,
upon receipt, deposit in the applicable Collateral Account described above, any
payments and monies that such Credit Party receives directly from its Investors
as Capital Contributions.
 
(b) No Duty.  Notwithstanding anything to the contrary herein contained, it is
expressly understood and agreed that neither Administrative Agent, Letter of
Credit Issuer, nor any other Secured Party undertakes any duties,
responsibilities, or liabilities with respect to Capital Calls.  None of them
shall be required to refer to the Constituent Documents of any Credit Party or
take any other action with respect to any other matter which might arise in
connection with such Constituent Documents, the Operating Agreement, the
Stockholders Agreement or any Capital Call.  None of them shall have any duty to
determine or inquire into any happening or occurrence or any performance or
failure of performance of any Credit Party or of any Investor.  None of them has
any duty to inquire into the use, purpose, or reasons for the making of any
Capital Call or with respect to the investment or the use of the proceeds
thereof.
 
Revolving Credit Agreement
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(c) Capital Calls.  In order that Secured Parties may monitor the Collateral and
the Capital Commitments, no Credit Party shall issue any Call Notice or
otherwise request, notify, or demand that any Investor make any Capital
Contribution, without delivering to Administrative Agent (which delivery may be
via facsimile) simultaneously with delivery of the Call Notices to any Investors
(“Call Notice Date”), copies of the Call Notice for each Investor from whom a
Capital Contribution is being sought.  Concurrently with the delivery of any
Call Notice, the Borrower shall deliver to Administrative Agent a Borrowing Base
Certificate showing no Implicit Borrowing Base Deficit would exist at such time
after application of the subject Capital Contributions in accordance with the
terms of the Call Notice.
 
(d) Use of Account; Capital Calls by Administrative Agent.  Borrower may request
that Administrative Agent withdraw funds from the Collateral Account at any time
or from time to time and disburse such funds as Borrower may direct, so long as
at the time of such withdrawal or disbursement and after giving effect
thereto:  (i) there does not exist an Event of Default or Potential Default; and
(ii) the Principal Obligation does not exceed the Available Loan Amount (unless,
in the latter case), Borrower has directed that such disbursement be paid to
Administrative Agent to repay such excess) and any request by Borrower for
withdrawal from the Collateral Account shall be deemed a representation and
warranty that the conditions set forth in the foregoing clauses (i), (ii) and
(iii) have been satisfied.  The Credit Parties hereby irrevocably authorize and
direct the Secured Parties, acting through Administrative Agent, to withdraw
from time to time funds from the Collateral Account for application to amounts
not paid when due (after the passage of any applicable grace period) to the
Secured Parties or any of them hereunder, under any Application and Agreement
for Letter of Credit, under any Letter of Credit or under the Notes to the
extent provided herein.  Administrative Agent, on behalf of the Secured Parties,
is hereby authorized, in the name of the Secured Parties or the name of any
Credit Party, at any time or from time to time upon the occurrence and while an
Event of Default exists, to notify any or all parties obligated to any Credit
Party with respect to the Capital Commitments to make all payments due or to
become due thereon directly to Administrative Agent on behalf of the Secured
Parties, at a different account number, or to initiate one or more Capital Call
Notices in order to pay the Obligations.  With or without such general
notification, when an Event of Default exists, Administrative Agent, on behalf
of Secured Parties:  (i) may make Capital Calls in the name of any Credit Party;
(ii) may take or bring in any Credit Party’s name or (or that of the Secured
Parties) all steps, actions, suits, or proceedings deemed by Administrative
Agent necessary or desirable to effect possession or collection of Capital
Commitments; (iii) may complete any contract or agreement of any Credit Party in
any way related to any of the Capital Commitments; (iv) may make allowances or
adjustments related to the Capital Commitments; (v) may compromise any claims
related to the Capital Commitments; (vi) may issue credit in its own name or the
name of any Credit Party; or (vii) may exercise any right, privilege, power, or
remedy provided to any Credit Party under the Constituent Documents of any
Credit Party, the Operating Agreement, or the Stockholders Agreement relating to
the right to call for Capital Contributions and to receive Capital
Contributions.  Regardless of any provision hereof, in the absence of gross
negligence or willful misconduct by Administrative Agent or Secured Parties,
none of Administrative Agent or Secured Parties shall ever be liable for failure
to collect or for failure to exercise diligence in the collection, possession,
or any transaction concerning, all or part of the Capital Call Notices, Capital
Commitments, or any Capital Contributions, or sums due or paid thereon, nor
shall they be under any obligation whatsoever to anyone by virtue of the
security interests and Liens relating to the Capital Call Notices, Capital
Commitments or any Capital Contributions.  Administrative Agent shall give
Borrower prompt notice of any action taken pursuant to this Section 5.2(d), but
failure to give such notice shall not affect the validity of such action or give
rise to any defense in favor of any Credit Party with respect to such action.
 
Revolving Credit Agreement
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(e) Event of Default.  During the existence and continuance of an Event of
Default, issuance by Administrative Agent on behalf of Secured Parties of a
receipt to any Person obligated to pay any Capital Contribution to any Credit
Party shall be a full and complete release, discharge, and acquittance to such
Person to the extent of any amount so paid to Administrative Agent for the
benefit of Secured Parties, so long as such amount shall not be invalidated,
declared to be fraudulent or preferential, set aside or required to be repaid to
a trustee, receiver or any other Person under any bankruptcy act or code, state
or federal law, common law or equitable doctrine.  Administrative Agent, on
behalf of the Secured Parties, is hereby authorized and empowered, during the
existence of and continuance of an Event of Default, on behalf of any Credit
Party, to endorse the name of any Credit Party upon any check, draft,
instrument, receipt, instruction, or other document, agreement or item,
including, but not limited to, all items evidencing payment of a Capital
Contribution of any Person to any Credit Party coming into Administrative
Agent’s or any Lender’s possession, and to receive and apply the proceeds
therefrom in accordance with the terms hereof.  Administrative Agent on behalf
of Secured Parties is hereby granted an irrevocable power of attorney, which is
coupled with an interest, to execute all checks, drafts, receipts, instruments,
instructions, or other documents, agreements, or items on behalf of any Credit
Party, either before or after demand of payment on the Obligations but only
during the existence and continuance  of an Event of Default, as shall be deemed
by Administrative Agent to be necessary or advisable, in the sole discretion,
reasonably exercised, of Administrative Agent, to preserve the security
interests and Liens in the Capital Commitments or to secure the repayment of the
Obligations, and neither Administrative Agent nor Secured Parties shall incur
any liability, in the absence of gross negligence or willful misconduct, in
connection with or arising from its exercise of such power of attorney.  The
application by Secured Parties of such funds shall, unless Administrative Agent
shall agree otherwise in writing, be the same as set forth in Section 3.4.
 
(f) No Representations.  Neither Administrative Agent nor Secured Parties shall
be deemed to make at any time any representation or warranty as to the validity
of any Call Notice nor shall Administrative Agent or the Secured Parties be
accountable for any Credit Party’s use of the proceeds of any Capital Call
Notice.
 
5.3. Agreement to Deliver Additional Collateral Documents.  Each Credit Party
shall deliver such security agreements, financing statements, assignments, and
other collateral documents (all of which shall be deemed part of the “Collateral
Documents”), in form and substance reasonably satisfactory to Administrative
Agent, as Administrative Agent acting on behalf of the Secured Parties may
reasonably request from time to time for the purpose of granting to, or
maintaining or perfecting in favor of the Secured Parties, first and exclusive
security interests in any of the Capital Call Notices and Capital Commitments,
together with other assurances of the enforceability and priority of the Secured
Parties’ Liens and assurances of due recording and documentation of the
Collateral Documents or copies thereof, as Administrative Agent may reasonably
require to avoid material impairment of the liens and security interests granted
or purported to be granted pursuant to this Section 5.
 
Revolving Credit Agreement
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5.4. Subordination of All Credit Party Claims.  As used herein, the term “Credit
Party Claims” means all debts and liabilities of any Investor to any Credit
Party, whether such debts and liabilities now exist or are hereafter incurred or
arise, or whether the obligations of such Person thereon be direct, contingent,
primary, secondary, several, joint and several, or otherwise, and irrespective
of whether such debts or liabilities be evidenced by note, contract, open
account, or otherwise, and irrespective of the Person or Persons in whose favor
such debts or liabilities may, at their inception, have been, or may hereafter
be created, or the manner in which they have been or may hereafter be acquired
by any Credit Party (including, without limitation, by setoff pursuant to the
terms of any applicable agreement).  Credit Party Claims shall include without
limitation all rights and claims of any Credit Party against an Investor
under the Constituent Documents of such Person.  At any time stays that the
Principal Obligation exceeds the Available Loan Amount, and until the mandatory
prepayment pursuant to Section 2.1(d) hereof in connection therewith, if any,
shall be paid and satisfied in full, or, during the existence and continuation
of an Event of Default, no Credit Party shall receive or collect, directly or
indirectly any amount upon the Credit Party Claims, other than to obtain funds
required to make any mandatory prepayment pursuant to Section 2.1(d).
 
Any Liens, security interests, judgment liens, charges, or other encumbrances
upon an Investor’s assets securing payment of Credit Party Claims, including,
but not limited to, any liens or security interests on an Investor’s Equity
Interest, shall be and remain inferior and subordinate in right of payment and
of security to any liens, security interests, judgment liens, charges, or other
encumbrances upon an Investor’s assets securing such Investor’s obligations and
liabilities to the Secured Parties pursuant to any of the Collateral Documents
executed by such Investor, regardless of whether such encumbrances in favor of
Borrower or a Qualified Borrower, Managing Member, the Pledgor or the Secured
Parties presently exist or are hereafter created or attach.  Without the prior
written consent of Administrative Agent, no Credit Party shall:  (a) exercise or
enforce any creditor’s, shareholder or partnership right it may have against an
Investor; (b) foreclose, repossess, sequester, or otherwise take steps or
institute any action or proceedings (judicial or otherwise, including without
limitation, the commencement of, or joinder in, any liquidation, bankruptcy,
rearrangement, debtor’s relief, or insolvency proceeding) to enforce any liens,
mortgages, deeds of trust, security interest, collateral rights, judgments or
other encumbrances on assets of such Investor held by such Person; or
(c) exercise any rights or remedies against an Investor under the Constituent
Documents of such Person; provided that any action taken by Administrative Agent
or the Secured Parties in Borrower’s name, or any action taken by Borrower that
is required under any Loan Document or to comply with any Loan Document, shall
not be a violation of this Section 5.4.
 
Revolving Credit Agreement
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6. [RESERVED]
 
7. ADDITIONAL ALTERNATE LENDER PROVISIONS
 
7.1. Assignment to Alternate Lenders.
 
(a) Assignment Amounts.  At any time on or prior to the Stated Maturity Date, if
the related Administrator on behalf of the applicable Conduit Lender so elects,
by written notice to Administrative Agent, Borrower and its related Managing
Agent, such Conduit Lender hereby assigns effective on the Assignment Date
referred to below all or such portions as may be elected by such Conduit Lender
of its interest in the Principal Obligation at such time to its Alternate
Lenders pursuant to this Section 7.1; provided, however, that unless such
assignment is an assignment of all such Conduit Lender’s interest in the
Principal Obligation in whole on or after its Conduit Investment Termination
Date, no such assignment shall take place pursuant to this Section 7.1 if an
Event of Default described in Section 12.1(n) shall then exist; and provided,
further, that no such assignment shall take place pursuant to this Section 7.1
at a time when such Conduit Lender is subject to any proceedings under any
Debtor Relief Laws.  No further documentation or action on the part of such
Conduit Lender, the Borrower, or the applicable Alternate Lenders shall be
required to exercise the rights set forth in the immediately preceding sentence,
other than the giving of the notice by the related Administrator on behalf of
such Conduit Lender referred to in such sentence and the delivery by the related
Managing Agent of a copy of such notice to each Alternate Lender in the Lender
Group (the date of the receipt by Administrative Agent of any such notice being
the “Assignment Date”).  Each Alternate Lender hereby agrees, unconditionally
and irrevocably and under all circumstances, without set-off, counterclaim or
defense of any kind, to pay the full amount of its Assignment Amount on such
Assignment Date to such Conduit Lender in immediately available funds in Dollars
based on the assigning Conduit Lender’s interest in the Principal Obligation, to
an account designated by the related Managing Agent.  Upon payment of its
Assignment Amount, each such Alternate Lender shall acquire an interest in the
Principal Obligation equal to its Alternate Lender Pro Rata Share thereof.  Upon
any assignment in whole by a Conduit Lender to its Alternate Lenders on or after
its Conduit Investment Termination Date as contemplated hereunder, such Conduit
Lender shall cease to make any additional Loans hereunder.  At all times prior
to its Conduit Investment Termination Date, nothing herein shall prevent a
Conduit Lender from making a subsequent Loan hereunder, in its sole discretion,
following any assignment pursuant to this Section 7.1 or from making more than
one assignment pursuant to this Section 7.1.
 
(b) Additional Assignment Amounts.  The applicable Borrower Party may pay to
Administrative Agent in Dollars, for the account of the related Managing Agent
for the benefit of its Conduit Lender, in connection with any assignment by a
Conduit Lender to its Alternate Lenders pursuant to this Section 7.1, an
aggregate amount equal to all Yield to accrue through the end of the current
Interest Period to the extent attributable to the portion of the Loans so
assigned to the Alternate Lenders (as determined immediately prior to giving
effect to such assignment), plus all Obligations then due, other than the Loans
and other than any Yield described above, attributable to such portion of the
Loans so assigned.  If the applicable Borrower Party does not make payment of
such amounts at or prior to the time of assignment by a Conduit Lender to its
Alternate Lenders, such amount shall be paid by such Alternate Lenders to the
Conduit Lender as additional consideration for the interests assigned to the
Alternate Lenders and the amount of the “Loans” hereunder held by such Alternate
Lenders shall be increased by an amount equal to the additional amount so paid
by such Alternate Lenders.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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(c) Administration of Agreement after Assignment from Conduit Lender to
Alternate Lenders following the Conduit Investment Termination Date.  After any
assignment in whole by a Conduit Lender to its Alternate Lenders pursuant to
this Section 7.1 at any time on or after its Conduit Investment Termination Date
(and the payment of all amounts owing to such Conduit Lender in connection
therewith), all rights of the related Administrator and the related Conduit
Collateral Agent set forth herein shall be given to the applicable Managing
Agent on behalf of its Alternate Lenders instead of such Administrator and
Conduit Collateral Agent.
 
(d) Payments to Administrative Agent.  After any assignment in whole by a
Conduit Lender to its Alternate Lenders pursuant to this Section 7.1 at any time
on or after its Conduit Investment Termination Date, all payments to be made
hereunder by a Borrower Party to Administrative Agent for the benefit of such
Conduit Lender shall be made to the account specified by the applicable Managing
Agent in writing to the Administrative Agent and the applicable Borrower Party.
 
(e) Recovery of Loans.  In the event that the aggregate of the Assignment
Amounts paid by the Alternate Lenders with respect to any Lender Group pursuant
to this Section 7.1 on any Assignment Date occurring on or after the Conduit
Investment Termination Date for the related Conduit Lender is less than the
Loans of such Conduit Lender on such Assignment Date, then to the extent that
payments or deposits thereafter received and applied by Administrative Agent
with respect to such Lender Group under Section 3.4 in respect of Loans exceed
the aggregate of the unrecovered Assignment Amounts and Loans funded by such
Alternate Lenders, such excess shall be remitted by Administrative Agent to the
related Managing Agent.
 
7.2. Downgrade of Alternate Lender.
 
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(a) Downgrades Generally. If at any time on or prior to the Stated Maturity
Date, the short-term debt rating of any Alternate Lender shall be “A-2” or “P-2”
from S&P or Moody’s, respectively, with negative credit implications, such
Alternate Lender, upon request of the related Managing Agent, shall, within
thirty (30) days of such request, assign its rights and obligations hereunder to
another financial institution (which institution’s short term debt shall be
rated at least “A-2” or “P-2” from S&P or Moody’s, respectively, and which shall
not be so rated with negative credit implications and which is acceptable to
such Conduit Lender and such Managing Agent).  If the short-term debt rating of
such Alternate Lender shall be “A-3” or “P-3”, or lower, from S&P or Moody’s,
respectively (or such rating shall have been withdrawn by S&P or Moody’s), such
Alternate Lender, upon request of the related Managing Agent, shall, within five
(5) Business Days of such request, assign its rights and obligations hereunder
to another financial institution (which institution’s short-term debt shall be
rated at least “A-2” or “P-2”, from S&P or Moody’s, respectively, and which
shall not be so rated with negative credit implications and which is acceptable
to such Conduit Lender and such Managing Agent).  In either such case, if any
such Alternate Lender shall not have assigned its rights and obligations under
this Credit Agreement within the applicable time period described above (in
either such case, the “Required Downgrade Assignment Period”), the Administrator
on behalf of such Conduit Lender shall have the right to require such Alternate
Lender to pay, in Dollars upon one (1) Business Day’s notice at any time after
the Required Downgrade Assignment Period (and each such Alternate Lender hereby
agrees in such event to pay within such time) to the applicable Managing Agent
an amount equal to such Alternate Lender’s unused Commitment (without any
deduction therefrom for such Alternate Lender’s share of the Letter of Credit
Liability) (a “Downgrade Draw”) for deposit by such Managing Agent into an
account, in the name of such Managing Agent (a “Downgrade Collateral Account”),
which shall be in satisfaction of such Alternate Lender’s obligations to make
Loans and to pay its Assignment Amount upon an assignment from such Conduit
Lender in accordance with Section 7.1; provided, however, that if, during the
Required Downgrade Assignment Period, such Alternate Lender delivers a written
notice to such Managing Agent of its intent to deliver a direct pay irrevocable
letter of credit pursuant to this proviso in lieu of the payment required to
fund the Downgrade Draw, then such Alternate Lender will not be required to fund
such Downgrade Draw.  If any Alternate Lender gives the applicable Managing
Agent such notice, then such Alternate Lender shall, within one (1) Business Day
after the Required Downgrade Assignment Period, deliver to such Managing Agent a
direct pay irrevocable letter of credit in favor of such Managing Agent issued
in Dollars, in an amount equal to the unused portion of such Alternate Lender’s
Commitment (without any deduction therefrom for such Alternate Lender’s share of
the Letter of Credit Liability), which letter of credit shall be issued through
a United States office of a bank or other financial institution:  (i) whose
short-term debt ratings by S&P and Moody’s are at least equal to the ratings
assigned by such statistical rating organization to the Commercial Paper; and
(ii) that is acceptable to such Conduit Lender and such Managing Agent.  Such
letter of credit shall provide that such Managing Agent may draw thereon for
payment of any Loan or Assignment Amount payable by such Alternate Lender which
is not paid hereunder when required, shall expire no earlier than the Stated
Maturity Date and shall otherwise be in form and substance acceptable to such
Managing Agent.  If on any date the amount on deposit in the Downgrade
Collateral Account or the maximum stated amount under any letter of credit so
provided is less than the applicable Alternate Lender’s share of the unused
Commitment, upon one (1) Business Day’s notice, such Alternate Lender will pay
the amount of such shortfall to the applicable Managing Agent for deposit into
the Downgrade Collateral Account or provide a substitute or additional direct
pay irrevocable letter of credit to cover such shortfall.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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(b) Application of Funds in Downgrade Collateral Account.  If any Alternate
Lender in any Lender Group shall be required pursuant to subsection (a) to fund
a Downgrade Draw, then the related Managing Agent shall apply the monies in the
Downgrade Collateral Account applicable to such Alternate Lender’s share of
Loans required to be made by the related Alternate Lenders, to any Assignment
Amount payable by such Alternate Lender pursuant to Section 7.1 at the times, in
the manner and subject to the conditions precedent set forth in this Credit
Agreement.  The deposit of monies in such Downgrade Collateral Account by any
Alternate Lender shall not constitute a Loan or the payment of any Assignment
Amount (and such Alternate Lender shall not be entitled to interest on such
monies except as provided below in this Section 7.2(b)), unless and until (and
then only to the extent that) such monies are used to fund Loans or to pay any
Assignment Amount pursuant to this Section 7.2(b).  The amount on deposit in
such Downgrade Collateral Account shall be invested by the related Managing
Agent in investments selected by such Managing Agent in its sole discretion and
eligible in accordance with the applicable conduit program documents.  Such
Managing Agent shall remit to such Alternate Lender, on the last Business Day of
each month, the interest income actually received thereon.  Unless required to
be released as provided below in this subsection, payments or deposits received
by such Managing Agent in respect of such Alternate Lender’s portion of the
Loans shall be deposited in the Downgrade Collateral Account for such Alternate
Lender.  Amounts on deposit in such Downgrade Collateral Account shall be
released to such Alternate Lender (or the stated amount of the letter of credit
delivered by such Alternate Lender pursuant to subsection (a) above may be
reduced) within one (1) Business Day after each Settlement Date following the
Maturity Date to the extent that, after giving effect to the distributions made
and received by the Lenders on such Settlement Date, the amount on deposit in
such Downgrade Collateral Account would exceed the Alternate Lender’s Alternate
Lender Pro Rata Share (determined as of the day prior to the Maturity Date) of
the sum of all Portions of Loans then funded by the related Conduit Lender, plus
the related Interest Component, plus such Alternate Lender’s Pro Rata Share of
the Letter of Credit Liability.  All amounts remaining in such Downgrade
Collateral Account shall be released to such Alternate Lender no later than the
Business Day immediately following the earliest of:  (i) the effective date of
any replacement of such Alternate Lender or removal of such Alternate Lender as
a party to this Credit Agreement; (ii) the date on which such Alternate Lender
shall furnish the related Managing Agent with confirmation that such Alternate
Lender shall have short term debt ratings of at least “A-2” or “P-2” from S&P
and Moody’s, respectively, without negative credit implications; and (iii) the
Stated Maturity Date.  Nothing in this Section 7.2 shall affect or diminish in
any way any such downgraded Alternate Lender’s Commitment to Borrower or its
related Conduit Lender or such downgraded Alternate Lender’s other obligations
and liabilities hereunder and under the other Loan Documents.
 
Revolving Credit Agreement
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(c) Program Support Agreement Downgrade Provisions.  Notwithstanding the other
provisions of this Section 7.2, an Alternate Lender shall not be required to
make a Downgrade Draw (or provide for the issuance of a letter of credit in lieu
thereof) pursuant to Section 7.2(a) at a time when such Alternate Lender has a
downgrade collateral account (or letter of credit in lieu thereof) established
pursuant to the Program Support Agreement to which it is a party in an amount at
least equal to its Commitment, and the related Managing Agent may apply monies
in such downgrade collateral account in the manner described in Section 7.2(b)
as if such downgrade collateral account were a Downgrade Collateral Account.
 
8. CONDITIONS PRECEDENT TO LENDING
 
8.1. Obligation of Lenders.  The obligation of each Lender and the Letter of
Credit Issuer to make the initial Loan and issue the first Letter of Credit
hereunder is subject to Administrative Agent’s receipt of the following:
 
(a) Credit Agreement.  This Credit Agreement, duly executed and delivered by
Borrower, Managing Member, Guarantor and Pledgor;
 
(b) Notes.  Notes drawn to the order of each Managing Agent, duly executed and
delivered by Borrower and Managing Member;
 
(c) Security Agreements.  (i) The Borrower and Managing Member Security
Agreement, duly executed and delivered by Borrower and Managing Member and
(ii) any other security agreement or related document reasonably requested by
Administrative Agent.
 
(d) Capital Contributions Pledge Agreement. (i) The Capital Contributions Pledge
Agreement, duly executed and delivered by Pledgor; and (ii) any other similar
agreement or related document reasonably requested by Administrative Agent.
 
(e) Guaranty of Capital.  The Guaranty of Capital, duly executed and delivered
by Guarantor.
 
(f) Account Documents.  The Account Assignment, duly executed and delivered by
Borrower;
 
(g) Financing Statements.
 
(i) searches of Uniform Commercial Code (“UCC”) filings in each jurisdiction
where a filing has been or would need to be made in order to perfect the
Administrative Agent’s security interest on behalf of the Secured Parties in the
Collateral, copies of the financing statements on file in such jurisdictions and
evidence that no Liens exist, or, if necessary, copies of proper financing
statements, if any, filed on or before the date hereof necessary to terminate
all security interests and other rights of any Person in any Collateral
previously granted; and
 
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(ii) duly authorized UCC financing statements and any amendments thereto, for
each appropriate jurisdiction as is necessary, in the Administrative Agent’s
sole discretion, to perfect the Administrative Agent’s security interest on
behalf of the Secured Parties in the Collateral;
 
(h) Responsible Officer Certificates.  A certificate from a Responsible Officer
of each Credit Party, stating that:  (i) all of the representations and
warranties contained in Section 9 hereof and the other Loan Documents made by
such Credit Party are true and correct in all material respects as of such date
(except to the extent of changes in facts or circumstances that have been
disclosed to Lenders and do not constitute an Event of Default or, to its
knowledge, a Potential Default under this Credit Agreement or any other Loan
Document); and (ii) no event has occurred and is continuing, or would result
from the Borrowing or issuance of the Letters of Credit, as applicable, which
constitutes an Event of Default or, to its knowledge, a Potential Default;
 
(i) Borrower’s Operating Agreement.  A signed certificate of a Responsible
Officer of Borrower who shall certify that attached thereto is a true and
complete copy of the Operating Agreement of Borrower as in effect on the date
hereof, together with certificates of existence and good standing (or other
similar instruments) of Borrower as in effect on the date hereof;
 
(j) Managing Member’s Formation Documents.  A signed certificate of a
Responsible Officer of Managing Member who shall certify that attached thereto
are true and complete copies of the Constituent Documents of Managing Member,
together with certificates of existence and good standing (or other similar
instruments) of Managing Member as in effect on the date hereof;
 
(k) Guarantor’s Formation Documents.  A signed certificate of a Responsible
Officer of Guarantor who shall certify that attached thereto are true and
complete copies of the Constituent Documents of Guarantor together with
certificates of existence and good standing (or other similar instruments) of
Guarantor as in effect on the date hereof;
 
(l) Pledgor’s Formation Documents.  A signed certificate of a Responsible
Officer of Pledgor who shall certify that attached thereto are true and complete
copies of the Constituent Documents of Pledgor together with certificates of
existence and good standing (or other similar instruments) of Pledgor as in
effect on the date hereof;
 
(m) Incumbency Certificate. From each Credit Party, a signed certificate of a
Responsible Officer, who shall certify the names of the Persons authorized, on
the date hereof, to sign each of the Loan Documents and the other documents or
certificates to be delivered pursuant to the Loan Documents on behalf of such
Credit Party, together with the true signatures of each such
Person.  Administrative Agent may conclusively rely on such certificate until it
shall receive a further certificate canceling or amending the prior certificate
and submitting the signatures of the Persons named in such further certificate;
 
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(n) Opinions of Counsel.  (i) A favorable opinion of Robert Masters, Senior Vice
President and General Counsel of each Credit Party, as counsel to each Credit
Party; (ii) a favorable opinion of Berliner, Corcoran & Rowe, L.L.P., Maryland
counsel to the Pledgor; and (iii) an opinion of Mayer Brown LLP, special counsel
to the Administrative Agent; each covering such matters relating to the
transactions contemplated hereby as reasonably requested by Administrative
Agent, and substantially in a form acceptable to Administrative Agent;
 
(o) ERISA Certificate.  A certificate from a Responsible Officer of the Credit
Parties confirming that the assets of the Credit Parties do not constitute plan
assets by reason of the fact that participation in the Credit Parties by
“benefit plan investors” is not “significant”, as such terms are defined in the
Plan Asset Regulations;
 
(p) Investor Documents.  Administrative Agent shall have received from each
Included Investor and Designated Investor: (i) a duly executed Investor Letter;
(ii) a copy of such Investor’s duly executed signature page to the Operating
Agreement or Stockholders Agreement, as applicable; and (iii) to the extent
requested by Administrative Agent, true and complete copies of the
organizational documents of each Investor, or other documentation in lieu
thereof that is acceptable to Administrative Agent in its sole
discretion.  Administrative Agent may waive one or more of the foregoing
requirements with respect to Designated Investors so long as Borrowers have made
good faith efforts to obtain the same without success;
 
(q) Fees; Costs and Expenses.  Payment of all fees and other amounts due and
payable on or prior to the date hereof, including pursuant to the Fee Letter,
and, to the extent invoiced, reimbursement or payment of all reasonable expenses
required to be reimbursed or paid by Borrower hereunder, including the fees and
disbursements invoiced through the date hereof of Administrative Agent’s special
counsel, Mayer Brown LLP;
 
(r) Advisory Committee Required Vote.  Written evidence in form reasonably
satisfactory to the Administrative Agent that the Advisory Committee (as defined
in the Operating Agreement) has approved the Loans and Letters of Credit
contemplated by this Credit Agreement and the other Loan Documents as
contemplated in Section 4.1(b) of the Operating Agreement; and
 
(s) Additional Information.  Such other information and documents as may
reasonably be required by Administrative Agent and its counsel, including any
“Know Your Customer” procedures as reasonably requested by the Lenders.
 
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8.2. Qualified Borrower Loans and Letters of Credit.  The obligation of Lenders
to advance a Loan to a Qualified Borrower or to cause the issuance of a Letter
of Credit for a Qualified Borrower is subject to the conditions that:
 
(a) Qualified Borrower Promissory Note.  Administrative Agent shall have
received a duly executed Qualified Borrower Promissory Note or Qualified
Borrower Letter of Credit Note, as applicable, complying with the terms and
provisions hereof;
 
(b) Authorizations of Qualified Borrower.  Administrative Agent shall have
received from the Qualified Borrower appropriate evidence of the authorization
of the Qualified Borrower approving the execution, delivery and performance of
the Qualified Borrower Promissory Note or the Qualified Borrower Letter of
Credit Note, duly adopted by Qualified Borrower, as required by law or
agreement, and accompanied by a certificate of an authorized Person of such
Qualified Borrower stating that such authorizations are true and correct, have
not been altered or repealed and are in full force and effect;
 
(c) Incumbency Certificate.  Administrative Agent shall have received from the
Qualified Borrower a signed certificate of the appropriate Responsible Officer
of the Qualified Borrower which shall certify the names of the Persons
authorized to sign the Qualified Borrower Promissory Note and the other
documents or certificates to be delivered pursuant to the terms hereof by such
Qualified Borrower, together with the true signatures of each such Person;
 
(d) Borrower Guaranty.  Administrative Agent shall have received from Borrower a
duly executed Borrower Guaranty complying with the terms and provisions hereof;
 
(e) Opinion of Counsel to Qualified Borrower.  Administrative Agent shall have
received a favorable opinion of counsel for the Qualified Borrower, in form and
substance satisfactory to Administrative Agent and addressed to Administrative
Agent, that:  (i) the Qualified Borrower is duly organized and validly existing
under the laws of the jurisdiction of its formation; (ii) the subject Qualified
Borrower Note has been duly authorized, executed and delivered by the Qualified
Borrower; (iii) the subject Qualified Borrower Note is a valid and binding
obligation and agreement of such Qualified Borrower, enforceable in accordance
with its terms, except to the extent that it may be limited by bankruptcy,
insolvency, moratorium and other laws affecting creditors’ rights generally, by
general equitable principles; and (iv) neither the execution nor delivery by
Qualified Borrower of the subject Qualified Borrower Note, and, if applicable,
the Application and Agreement for Letter of Credit, the performance by such
Qualified Borrower of its obligations thereunder, nor the compliance by
Qualified Borrower with the terms and provisions thereof, will:  (A) contravene
any provision of the general corporate law, or, if Qualified Borrower is a
partnership or another type of entity, the Managing Membership law or applicable
law governing such entity, of the jurisdiction of formation of such Qualified
Borrower, or the laws, statutes, rules or regulations of the State of New York
or the United States of America to which Qualified Borrower is subject, or
conflict with, or result in any breach of, any material agreement, mortgage,
indenture, deed of trust or other instrument known to counsel to which Qualified
Borrower or its properties may be subject, or result in the creation of any
mortgage, lien, pledge or encumbrance in respect of any properties of Qualified
Borrower; (B) contravene any judgment, decree, license, order or permit
applicable to Qualified Borrower; or (C) violate any provision of the
organizational documents of Qualified Borrower.  Each Qualified Borrower hereby
directs its counsel to prepare and deliver such legal opinion to Administrative
Agent for the benefit of Lenders.
 
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8.3. All Loans and Letters of Credit.  The obligation of Lenders to advance each
Borrowing or the Letter of Credit Issuer to issue Letters of Credit hereunder is
subject to the conditions that:
 
(a) Representations and Warranties.  The representations and warranties set
forth in Section 9 hereof are true and correct in all material respects on and
as of the date of the advance of such Borrowing or issuance of such Letter of
Credit, with the same force and effect as if made on and as of such date (except
to the extent of changes in facts or circumstances that have been disclosed to
Lenders and do not constitute an Event of Default or a Potential Default under
this Credit Agreement or any other Loan Document);
 
(b) No Default.  No event shall have occurred and be continuing, or would result
from the Borrowing or the issuance of the Letter of Credit, which constitutes an
Event of Default or a Potential Default;
 
(c) Loan Notice.  Administrative Agent shall have received a Loan Notice or
Request for Letter of Credit;
 
(d) Application.  In the case of a Letter of Credit, the Letter of Credit Issuer
shall have received an Application and Agreement for Letter of Credit executed
by Borrower or the applicable Qualified Borrower and shall have countersigned
the same; and
 
(e) Material Adverse Effect.  No Material Adverse Effect has occurred and is
continuing.
 
9. REPRESENTATIONS AND WARRANTIES.  To induce Lenders to make the Loans and
cause the issuance of Letters of Credit hereunder, each Credit Party represents
and warrants to Lenders as to itself that:
 
9.1. Organization and Good Standing of Borrower.  Borrower is a limited
liability company duly organized and validly existing under the laws of the
State of Delaware, has the requisite limited liability company power and
authority to own its properties and assets and to carry on its business as now
conducted, and is qualified to do business in each jurisdiction where the nature
of the business conducted or the property owned or leased requires such
qualification or where the failure to be so qualified to do business would have
a Material Adverse Effect.
 
9.2. Organization and Good Standing of Managing Member.  Managing Member is a
limited liability company duly organized and validly existing under the laws of
the State of Delaware, has the requisite limited liability company power and
authority to own its properties and assets and to carry on its business as now
conducted, and is qualified to do business in each jurisdiction where the nature
of the business conducted or the property owned or leased requires such
qualification or where the failure to be so qualified to do business would have
a Material Adverse Effect.
 
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9.3. Organization and Good Standing of Guarantor.  Guarantor is a limited
partnership duly organized and validly existing under the laws of the State of
Delaware, has the requisite limited partnership power and authority to own its
properties and assets and to carry on its business as now conducted, and is
qualified to do business in each jurisdiction where the nature of the business
conducted or the property owned or leased requires such qualification or where
the failure to be so qualified to do business would have a Material Adverse
Effect.
 
9.4. Organization and Good Standing of Pledgor.  Pledgor is a corporation
incorporated and validly existing under the laws of the State of Maryland, has
the requisite corporate power and authority to own its properties and assets and
to carry on its business as now conducted, and is qualified to do business in
each jurisdiction where the nature of the business conducted or the property
owned or leased requires such qualification or where the failure to be so
qualified to do business would have a Material Adverse Effect.
 
9.5. Authorization and Power.  It has the partnership, limited liability company
or corporate power, as applicable, and requisite authority to execute, deliver,
and perform its respective obligations under this Credit Agreement, the Notes,
and the other Loan Documents to be executed by it.  It is duly authorized to,
and has taken all partnership, limited liability company and corporate action,
as applicable, necessary to authorize it to execute, deliver, and perform its
respective obligations under this Credit Agreement, the Notes, and such other
Loan Documents and is and will continue to be duly authorized to perform its
respective obligations under this Credit Agreement, the Notes, and such other
Loan Documents.
 
9.6. No Conflicts or Consents.  None of the execution and delivery of this
Credit Agreement, the Notes, or the other Loan Documents, the consummation of
any of the transactions herein or therein contemplated, or the compliance with
the terms and provisions hereof or with the terms and provisions thereof, will
contravene or conflict, in any material respect, with any provision of law,
statute, or regulation to which it is subject or any judgment, license, order,
or permit applicable to it or any indenture, mortgage, deed of trust, or other
agreement or instrument to which it is a party or by which it may be bound, or
to which it may be subject.  No consent, approval, authorization, or order of
any court or Governmental Authority or third party is required in connection
with the execution and delivery by it of the Loan Documents to which it is a
party or to consummate the transactions contemplated hereby or thereby except
for those that have been obtained.
 
9.7. Enforceable Obligations.  This Credit Agreement, the Notes and the other
Loan Documents to which it is a party are the legal and binding obligations of
it, enforceable in accordance with their respective terms, subject to Debtor
Relief Laws and equitable principles.
 
9.8. Priority of Liens.  The Collateral Documents create, as security for the
Obligations, valid and enforceable, exclusive, first priority security interests
in and Liens on all of the Collateral in which it has any right, title or
interest, in favor of Administrative Agent for the benefit of the Secured
Parties, subject to no other Liens, except as enforceability may be limited by
Debtor Relief Laws and equitable principles.  Such security interests in and
Liens on the Collateral in which it has any right, title, or interest shall be
superior to and prior to the rights of all third parties in such Collateral,
and, other than in connection with any future change in its name, identity or
structure, or the location of its chief executive office, no further recordings
or filings are or will be required in connection with the creation, perfection
or enforcement of such security interests and Liens, other than the filing of
continuation statements in accordance with applicable law.  Each Lien referred
to in this Section 9.7 is and shall be the sole and exclusive Lien on the
Collateral in which it has any right, title or interest.
 
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9.9. Financial Condition.  Each Borrower Party has delivered to Administrative
Agent: (a) the most-recently available copies of the financial statements and
reports described in Section 10.1; or, with respect to such requirement on the
Closing Date, if such statements and reports are not then available (b) a pro
forma balance sheet as of the Closing Date; in each case certified as true and
correct in all material respects by a Responsible Officer of such Borrower
Party.  Such statements fairly present, in all material respects, the financial
condition of such Borrower Party as of the applicable date of delivery, and have
been prepared in accordance with GAAP, except as provided therein.
 
9.10. Full Disclosure.  There is no material fact that any Credit Party has not
disclosed to Administrative Agent in writing which would reasonably be expected
to result in a Material Adverse Effect.  No information heretofore furnished by
any Credit Party in connection with this Credit Agreement, the other Loan
Documents or any transaction contemplated hereby or thereby contains any untrue
statement of a material fact that would reasonably be expected to result in a
Material Adverse Effect.
 
9.11. No Default.  No event has occurred and is continuing which constitutes an
Event of Default or a Potential Default.
 
9.12. No Litigation.  There are no actions, suits, investigations or legal,
equitable, arbitration or administrative proceedings pending, or to the
knowledge of a Responsible Officer of it, threatened, against such Credit Party
that would reasonably be expected to result in a Material Adverse Effect.
 
9.13. Material Adverse Change.  No changes to it have occurred since the date of
its most recent financial statements delivered to Lenders which would reasonably
be expected to result in a Material Adverse Effect.
 
9.14. Taxes.  To the extent that failure to do so would have a Material Adverse
Effect, all tax returns required to be filed by it in any jurisdiction have been
filed and all taxes, assessments, fees, and other governmental charges upon it
or upon any of its respective properties, income or franchises have been paid
prior to the time that such taxes could give rise to a lien thereon.  There is
no proposed tax assessment against it or any basis for such assessment which is
material and is not being contested in good faith.
 
9.15. Jurisdiction of Formation; Principal Office.  (a) The jurisdiction of
formation of Borrower is Delaware; (b) the jurisdiction of formation of Managing
Member is Delaware; (c) the jurisdiction of formation of Guarantor is Delaware;
and (d) the jurisdiction of formation of Pledgor is Maryland.
 
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9.16. ERISA Compliance.  It has not established nor does it maintain any
Plan.  (a) Each of Credit Party and Guarantor is an Operating Company; or
(b) the underlying assets of each Credit Party do not otherwise constitute Plan
Assets.
 
9.17. Compliance with Law.  It is, to the best of its knowledge, in compliance
in all material respects with all material laws, rules, regulations, orders, and
decrees which are applicable to it or its properties, including, without
limitation, Environmental Laws.
 
9.18. Hazardous Substances.  To the knowledge of its Responsible Officers, it:
(a) has not received any notice or other communication or otherwise learned of
any Environmental Liability which would individually or in the aggregate
reasonably be expected to have a Material Adverse Effect arising in connection
with: (i) any non-compliance with or violation of the requirements of any
Environmental Law by any Credit Party, or any permit issued under any
Environmental Law to such Credit Party; or (ii) the Release or threatened
Release of any Hazardous Material into the environment; and (b) to its
knowledge, has threatened or actual liability in connection with the Release or
threatened Release of any Hazardous Material into the environment which would
individually or in the aggregate reasonably be expected to have a Material
Adverse Effect.
 
9.19. Insider.  It is not an “executive officer,” “director,” or “person who
directly or indirectly or acting through or in concert with one or more persons
owns, controls, or has the power to vote more than 10% of any class of voting
securities” (as those terms are defined in 12 U.S.C. §375b or in regulations
promulgated pursuant thereto) of any Lender, of a bank holding company of which
any Lender is a subsidiary, or of any subsidiary, of a bank holding company of
which any Lender is a subsidiary, of any bank at which any Lender maintains a
correspondent account, or of any bank which maintains a correspondent account
with any Lender.
 
9.20. Properties.  Each Credit Party has good title to, or valid leasehold
interests in, all its real and personal property material to its business,
except for any defects that, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.  Each Credit
Party owns, or is licensed to use, all trademarks, tradenames, copyrights,
patents and other intellectual property material to its business, and the use
thereof by such Credit Party and its subsidiaries does not infringe upon the
rights of any other Person, except for any such infringements that, individually
or in the aggregate, could not reasonably be expected to result in a Material
Adverse Effect.
 
9.21. Operating Structure.  As of the date hereof, the sole Managing Member of
Borrower is Managing Member.  The only members of Borrower and the only
Stockholders of Pledgor are set forth on Exhibit A attached hereto and
incorporated herein by reference (or on a revised Exhibit A delivered to
Administrative Agent in accordance with Section 11.5 hereof), and the Capital
Commitment of each Investor is set forth on Exhibit A (or on such revised
Exhibit A).
 
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9.22. Capital Commitments and Contributions.  The aggregate amount of the
Unfunded Capital Commitments of all Investors as of the date hereof is as set
forth on Exhibit A.  The aggregate amount of the Unfunded Capital Commitments of
all Included Investors and Designed Investors (separately) as of the date hereof
is as set forth on Exhibit A.  There are no Capital Call Notices outstanding
except as otherwise disclosed in writing to Administrative Agent.  To its
knowledge, no Investor is in default under the Operating Agreement, Partnership
Agreement or Stockholders Agreement, as applicable.  Prior to the date hereof,
each Credit Party has satisfied all conditions to its rights to make a Capital
Call, including any and all conditions contained in its Constituent Documents.
 
9.23. Fiscal Year.  Its fiscal year is the calendar year.
 
9.24. Investment Company Act.  It is not required to register as an “investment
company” within the meaning of the Investment Company Act of 1940, as amended.
 
9.25. Margin Stock.  It is not engaged in the business of extending credit for
the purpose of purchasing or carrying Margin Stock, and no proceeds of any Loan
or Letter of Credit will be used: (a) to purchase or carry any Margin Stock or
to extend credit to others for the purpose of purchasing or carrying any Margin
Stock; (b) to reduce or retire any indebtedness which was originally incurred to
purchase or carry any such Margin Stock; or (c) for any other purpose which
might constitute this transaction a “purpose credit” within the meaning of
Regulation T, U, or X.  Neither it nor any Person acting on its behalf has taken
or will take any action which might cause any Loan Document to violate
Regulation T, U or X or any other regulation of the Board of Governors of the
Federal Reserve System or to violate Section 7 of the Securities Exchange Act,
in each case as now in effect or as the same may hereafter be in effect.
 
9.26. Foreign Asset Control Laws.  Neither it nor any Affiliate thereof, and no
Investor or, to its knowledge, Affiliate thereof, is a Person named on a list
published by the Office of Foreign Assets Control (“OFAC”) of the United States
Treasury Department or is a Person with whom dealings are prohibited under any
OFAC regulations.  To its knowledge, no Investor’s funds used in connection with
this transaction are derived from illegal or suspicious activities.
 
9.27. Brokers’ Fees.  No Credit Party has dealt with any broker or finder with
respect to the transactions contemplated by the Loan Documents or otherwise in
connection with the Loan Documents.
 
9.28. Solvency.  Each Credit Party is, and after consummation of the
transactions contemplated by the Loan Documents will be, Solvent.
 
9.29. Managing Member Representation.  Managing Member has received direct or
indirect benefit from the Loans and Letters of Credit evidenced by the
Obligations and the grant of the security interest in the collateral was a
condition to granting such Loans and issuance of such Letters of Credit.
 
9.30. Guarantor Representation.  Guarantor has received direct or indirect
benefit from the Loans and Letters of Credit evidenced by the Obligations and
the grant of the security interest in the collateral was a condition to granting
such Loans and issuance of such Letters of Credit.
 
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9.31. Pledgor Representation.  Pledgor has received direct or indirect benefit
from the Loans and Letters of Credit evidenced by the Obligations and the grant
of the security interest in the Collateral was a condition to granting such
Loans and issuance of such Letters of Credit.
 
9.32. Investments.  No investments made by any Credit Party or their
subsidiaries, directly or indirectly, are in violation of, or would cause a
default under, the terms of the Operating Agreement, the Partnership Agreement
or the Stockholders Agreement.
 
9.33. Investor Documents.  To the knowledge of each Credit Party after
commercially reasonable inquiry, each Investor Letter and Stockholders
Agreement, as applicable, have been duly authorized and executed by each
Investor and constitute the legal, valid and binding obligations of each
Investor, enforceable against each Investor in accordance with their terms.
 
9.34. Advisory Committee.  The Credit Parties confirm that the members of the
Advisory Committee (as defined in the Operating Agreement) as of the date hereof
are Alan Forman, Verna Kuo, Susan Meaney, Denise Strack and Laudan Nabizadeh.
 
10. AFFIRMATIVE COVENANTS.  So long as Lenders have any commitment to lend
hereunder or the Letter of Credit Issuer has any obligation to cause the
issuance of any Letters of Credit hereunder, and until payment in full of the
Notes and the performance in full of the Obligations under this Credit Agreement
and the other Loan Documents, Borrower and each other Credit Party, as
applicable, each agrees that, unless Administrative Agent shall otherwise
consent in writing based upon the approval of the Required Lenders (unless the
approval of Administrative Agent alone or a different number of Lenders is
expressly permitted below):
 
10.1. Financial Statements, Reports and Notices.  Borrower shall deliver to
Administrative Agent sufficient copies for each Lender of the following:
 
(a) Annual Statements.  As soon as reasonably available and in any event within
one hundred twenty (120) days after the end of each fiscal year of Borrower,
audited, unqualified financial statements of Borrower, including a consolidated
balance sheet of Borrower and its consolidated subsidiaries as of the end of
such fiscal year and the related consolidated statements of operations for such
fiscal year prepared by independent public accountants of nationally recognized
standing;
 
(b) Quarterly Statements.  As soon as available and in any event within sixty
(60) days after the end of each quarter of each fiscal year of Borrower, an
unaudited consolidated balance sheet of Borrower and its consolidated
subsidiaries as of the end of such quarter and the related unaudited
consolidated statements of operations for such quarter;
 
(c) Borrowing Base Certificate.  Concurrently with the delivery of each Loan
Notice or Request for Letter of Credit and each annual and quarterly report
referenced in Sections 10.1(a) and 10.1(b) hereof, and as of the last calendar
day of any calendar month when no Borrowing has been made during such calendar
month, a Borrowing Base Certificate signed by a Responsible Officer of Borrower
and Managing Member: (i) setting forth the Capital Contributions and Unfunded
Capital Commitments of all of the Investors and a calculation of the Available
Loan Amount (all as of the end of the relevant period); (ii) specifying changes,
if any, in the names of Investors; and (iii) listing Investors who have not
delivered Investor Letters or with respect to Subsequent Investors, who have not
satisfied the conditions of Section 11.5(c) hereof;
 
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(d) Compliance Certificate.  Simultaneously with the delivery of the reports
described in clauses (a) and (b) above, a compliance certificate (a “Compliance
Certificate”), certified by a Responsible Officer of Borrower to be true and
correct, substantially in the form of Exhibit O attached hereto (with blanks
appropriately completed in conformity herewith): (i) stating that such officer
is familiar with the terms and provisions of the Loan Documents; (ii) certifying
that such financial statements fairly present the financial condition and the
results of operations of the Borrower on the dates and for the periods
indicated, on the basis of GAAP, subject, in the case of interim financial
statements, to normally recurring year-end adjustments; (iii) stating that the
Borrowers are in compliance with all covenants in Section 10 hereof, including
the covenants set forth in Section 10.11, and containing the calculations
evidencing such compliance; (iv) stating whether any Event of Default or
Potential Default exists on the date of such certificate and, if any Event of
Default or Potential Default then exists, setting forth the details thereof and
the action which the Credit Parties are taking or propose to take with respect
thereto; (v) setting forth the Unfunded Capital Commitments of all Investors
(breaking out Included Investors and Designated Investors) and a calculation of
the Available Loan Amount (all as of the end of the relevant period); (vi)
specifying changes, if any, in the name of any Investor or in the identity of
any Investor, by merger or otherwise; and (vii) listing Investors which have
been subject to an Exclusion Event.
 
(e) ERISA Notices.  Promptly upon any Credit Party obtaining knowledge or a
reasonable belief that its assets are, or are about to become, Plan Assets, such
Credit Party shall deliver written notice thereof to Administrative Agent (an
“ERISA Event Notice”), and shall, in such notice, or in subsequent written
notices as events develop, notify Administrative Agent of any actions
contemplated by in connection therewith.  Each Credit Party shall,
simultaneously with the delivery of any ERISA Notice to any Investors, deliver a
copy of the same to Administrative Agent;
 
(f) ERISA Certification.  Annually (to be delivered within forty-five (45) days
following each annual valuation period of the Credit Parties and with the
Compliance Certificate of Borrower pursuant to Section 10.1(d)), a certification
from a Responsible Officer of the Credit Parties prepared in consultation with
counsel that the assets of the Credit Parties do not constitute Plan Assets;
 
(g) Reporting Relating to Investors.  Promptly upon the receipt thereof, copies
of all financial statements, notices of default, notices relating in any way to
an Investor’s funding obligation and notices containing any reference to
misconduct of any Credit Party, sent to or received by a Borrower and/or any
Credit Party from an Investor; and
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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(h) Other Reporting.  Simultaneously with delivery to the Investors, copies of
all other material financial statements, appraisal reports, notices, and other
matters at any time or from time to time prepared by a Credit Party and
furnished to the Investors, including, without limitation, any notice of
default, notice of election or exercise of any rights or remedies under the
Operating Agreement, the Partnership Agreement, the Stockholders Agreement, the
Investor Letters or the Constituent Documents of any Credit Party, or any
notices relating in any way to any Investor’s Capital Commitment, and any notice
relating in any way to the misconduct of any Credit Party.
 
10.2. Payment of Taxes.  Each Credit Party will pay and discharge all taxes,
assessments, and governmental charges or levies imposed upon it, upon its income
or profits, or upon any property belonging to it before delinquent, if such
failure would have a Material Adverse Effect; provided, however, that no Credit
Party shall be required to pay any such tax, assessment, charge, or levy if and
so long as the amount, applicability, or validity thereof shall currently be
contested in good faith by appropriate proceedings and appropriate reserves
therefor have been established.
 
10.3. Maintenance of Existence and Rights.  Each Credit Party will preserve and
maintain its existence.  Each Credit Party shall further preserve and maintain
all of its rights, privileges, and franchises necessary in the normal conduct of
its business and in accordance with all valid regulations and orders of any
Governmental Authority the failure of which would have a Material Adverse
Effect.
 
10.4. Notice of Default.  Each Credit Party will furnish to Administrative
Agent, promptly upon becoming aware of the existence of any condition or event
which constitutes an Event of Default or a Potential Default (including, without
limitation, notice from the Investors of any Credit Party that the Investors
intend to seek a “Cause Event” as defined in the Operating Agreement,
Partnership Agreement and Stockholders Agreement, a written notice specifying
the nature and period of existence thereof and the action which the Credit
Parties are taking or propose to take with respect thereto.  Each Credit Party
shall promptly notify Administrative Agent in writing upon becoming aware:
(a) that any Investor has violated or breached any material term of the
Operating Agreement, Partnership Agreement or Stockholders Agreement, as
applicable, or has become a Defaulting Investor; or (b) of the existence of any
condition or event which, with the lapse of time or giving of notice or both,
would cause an Investor to become a Defaulting Investor.
 
10.5. Other Notices.  Each Credit Party will, promptly upon receipt of actual
knowledge thereof by a Responsible Officer, notify Administrative Agent of any
of the following events that would reasonably be expected to result in a
Material Adverse Effect: (a) any change in the financial condition or business
of such Credit Party; (b) any default by such Credit Party under any material
agreement, contract, or other instrument to which such Credit Party is a party
or by which any of its properties are bound, or any acceleration of the maturity
of any material indebtedness owing by such Credit Party; (c) any uninsured claim
against or affecting such Credit Party or any of its properties; (d) the
commencement of, and any material determination in, any litigation with any
third party or any proceeding before any Governmental Authority affecting such
Credit Party; (e) any Environmental Complaint or any claim, demand, action,
event, condition, report or investigation indicating any potential or actual
liability of such Credit Party arising in connection with: (i) the
non-compliance with or violation of the requirements of any Environmental Law or
any permit issued under any Environmental Law; or (ii) the Release or threatened
Release of any Hazardous Material into the environment; (f) the existence of any
Environmental Lien on any Properties or assets of such Credit Party; (g) any
material remedial action taken by any Credit Party in response to any order,
consent decree or judgment of any Governmental Authority or any Environmental
Liability; or (h) the listing of any of such Credit Party’s Properties on
CERCLIS to the extent that such Credit Party obtains knowledge of such listing,
whether or not such listing would reasonably be expected to result in a Material
Adverse Effect.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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10.6. Compliance with Loan Documents, Operating Agreement, Partnership Agreement
and Stockholders Agreement.  Unless otherwise approved in accordance with the
terms of this Credit Agreement (which approval, by such terms, may require more
or fewer Lenders than the Required Lenders), each Credit Party will promptly
comply with any and all covenants and provisions of this Credit Agreement, the
Notes, and all of the other Loan Documents executed by it.  Each Borrower Party
will use the proceeds of any Capital Call Notices only for such purposes as are
permitted by its Constituent Documents.
 
10.7. Books and Records; Access.  Each Credit Party will give any representative
of Administrative Agent, Managing Agent or Lenders, or any of them, reasonable
access during all business hours to, and permit representatives to examine,
copy, or make excerpts from, any and all books, records, and documents in the
possession of such Credit Party and relating to its affairs, and to inspect any
of the properties of such Credit Party.
 
10.8. Compliance with Law.  Each Credit Party will comply in all material
respects with all material laws, rules, regulations, and all orders of any
Governmental Authority, including, Environmental Laws and ERISA.
 
10.9. Insurance.  Each Credit Party will maintain workmen’s compensation
insurance, liability insurance, and insurance on its present and future
properties, assets, and business against such casualties, risks, and
contingencies, and in such types and amounts, as are consistent with customary
practices and standards of their industry and the failure of which to maintain
could have a Material Adverse Effect.
 
10.10. Authorizations and Approvals.  Each Credit Party will promptly obtain,
from time to time at its own expense, all such governmental licenses,
authorizations, consents, permits and approvals as may be required to enable
such Credit Party to comply with its respective obligations hereunder, under the
other Loan Documents, the Operating Agreement, the Partnership Agreement, the
Stockholders Agreement and its respective Constituent Documents.
 
10.11. Maintenance of Liens.  Each Credit Party shall perform all such acts and
execute all such documents as Administrative Agent may reasonably request in
order to enable the Secured Parties to report, file, and record every instrument
that Administrative Agent may deem necessary in order to perfect and maintain
the Secured Parties’ Liens and security interests in the Collateral and
otherwise to preserve and protect the rights of Secured Parties under the
Collateral Documents.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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10.12. Further Assurances.  Each Credit Party will make, execute or endorse, and
acknowledge and deliver or file or cause the same to be done, all such vouchers,
invoices, notices, certifications, and additional agreements, undertakings,
conveyances, transfers, assignments, financing statements, or other assurances,
and take any and all such other action, as Administrative Agent may, from time
to time, reasonably deem necessary in connection with this Credit Agreement or
any of the other Loan Documents, the obligations of the Credit Parties hereunder
or thereunder, or for better assuring and confirming unto Secured Parties all or
any part of the security for any of such obligations anticipated herein.
 
10.13. Investor Financial and Rating Information.  Each Credit Party shall
request, from each Investor (without duplication), financial information
required under the applicable Investor Letter, as agreed from time to time with
Administrative Agent, and shall, upon receipt of such information, promptly
deliver same to Administrative Agent, or shall promptly notify Administrative
Agent of its failure to timely obtain such information.  The Credit Parties will
promptly notify Administrative Agent in writing (but in no event later than five
(5) Business Days) after: (a) becoming aware of: (i) any decline in the Rating
of any Included Investor, or decline in the capital status of any Included
Investor that is a bank holding company, whether or not such change results in
an Exclusion Event and (ii) any other Exclusion Event; and (b) becoming aware of
the existence of any condition or event which, with the lapse of time or giving
of notice or both, would cause an Exclusion Event.
 
10.14. Certain Included Investor Requirements.  In addition to the other
requirements of this Credit Agreement, each Included Investor that is:
(i) organized under the laws of any jurisdiction other than the United States of
America or any state thereof shall deliver to Administrative Agent a written
submission to the jurisdiction of a United States Federal District Court and a
United States state court with respect to any litigation arising out of or in
connection with its Investor Letter or any Constituent Document of any Credit
Party (each submission to be in form and substance reasonably satisfactory to
Administrative Agent, including provisions relating to waiver of venue, waiver
of defense of inconvenient forum, and consent to service of process; or (ii) a
Governmental Authority or an instrumentality of a Governmental Authority or
majority-owned by a Governmental Authority or otherwise entitled to any immunity
in respect of any litigation in any jurisdiction, court or venue, shall deliver
to Administrative Agent a written waiver (in form and substance reasonably
satisfactory to Administrative Agent) of any such claim of immunity.
 
10.15. Covenants of Qualified Borrowers.  The covenants and agreements of
Qualified Borrowers hereunder shall be binding and effective only upon and after
the execution and delivery of a Qualified Borrower Note by such Qualified
Borrower.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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11. NEGATIVE COVENANTS. So long as Lenders have any commitment to lend hereunder
or the Letter of Credit Issuer has any obligation to cause the issuance of any
Letter of Credit hereunder, and until payment and performance in full of the
Obligations under this Credit Agreement and the other Loan Documents, each
Credit Party agrees that, without the written consent of Administrative Agent,
based upon the approval of Required Lenders (unless the approval of
Administrative Agent alone or a different number of Lenders is expressly
permitted below):
 
11.1. Mergers.  No Credit Party will merge or consolidate with or into any
Person, unless such Credit Party is the surviving entity; provided, however,
that any such merger (a) must be duly authorized under the Constituent Documents
of the applicable Credit Party or the applicable managing member or general
partner, as applicable, and (b) must not adversely affect the enforceability of
the Capital Commitments and the Investor Letters of the Investors in the
applicable Credit Party.  No Credit Party will take any action to dissolve,
terminate, or liquidate, including, without limitation, any action to sell or
dispose of all or substantially all of its property..
 
11.2. Negative Pledge.  Without the approval of all Lenders, no Credit Party
will create or suffer to exist any Lien upon the Collateral, other than the
first priority security interest in and upon the Collateral (or any portion
thereof) to Administrative Agent for the benefit of the Secured Parties.
 
11.3. Fiscal Year and Accounting Method.  Without the prior written consent of
Administrative Agent alone (such approval not to be unreasonably withheld or
delayed), no Credit Party will change its fiscal year or method of accounting.
 
11.4. Constituent Documents.  Without the prior written consent of
Administrative Agent consistent with this Section 11.4, no Credit Party shall
alter, amend, modify, terminate, or change any provision of its Constituent
Documents affecting such Credit Party’s or the Investors’ debts, duties,
obligations, and liabilities, and the rights, titles, security interests, liens,
powers and privileges of any Credit Party, Administrative Agent or Secured
Parties, in each case relating to this Agreement, the Obligations, Capital Call
Notices, Capital Commitments, Capital Contributions or Unfunded Capital
Commitments; or amend the terms of Articles V or XI  of the Operating Agreement
or Section 6 of the Stockholders Agreement (or comparable provisions regarding
leverage) (each an “adverse amendment”); or suspend, reduce, excuse or terminate
any Investor’s Unfunded Commitments.  With respect to any proposed amendment,
modification or change to any Constituent Document, the applicable Credit Party
shall notify Administrative Agent of such proposal.  Administrative Agent shall
determine, in its sole discretion (that is, the determination of the Lenders
shall not be required) on Administrative Agent’s good faith belief, whether such
proposed amendment, modification or change to such Constituent Document is an
adverse amendment, and shall use reasonable efforts to notify such Credit Party
of its determination within five (5) Business Days of the date on which it
received such notification pursuant to Section 14.7.  If Administrative Agent
determines that the proposed amendment is an adverse amendment, the approval of
the Required Lenders and Administrative Agent will be required (unless the
approval of all Lenders is required consistent with the terms of Section 11.6),
and Administrative Agent shall promptly notify the Lenders of such request for
such approval, distributing, as appropriate, the proposed amendment and any
other relevant information provided by such Credit Party, to which the Lenders
will respond to within ten (10) Business Days.  If Administrative Agent
determines that the proposed amendment is not an adverse amendment, such Credit
Party may make such amendment without the consent of Lenders.  Notwithstanding
the foregoing, without the consent of Administrative Agent or the Lenders, such
Credit Party may amend its Constituent Documents: (i) to admit new Investors to
the extent permitted by this Credit Agreement; and (ii) to reflect transfers of
interests permitted by this Credit Agreement.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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11.5. Transfer by, or Admission of, Investors.
 
(a) Transfer of Equity Interest.  Any transfer of an Equity Interest: (i) by any
Investor to any of its affiliates shall be made with prior written notice to
Administrative Agent promptly upon any Credit Party being aware of such proposed
transfer; and (ii) by any Investor to any other Person, with prior written
notice to Administrative Agent at least twenty (20) Business Days prior to the
proposed date of transfer, in each case provided that the transferee is not
named on a list published by OFAC.  In the event that the applicable transferee
does not itself qualify as an Included Investor or Designated Investor or if the
consummation of such transfer would require a mandatory prepayment pursuant to
Section 2.1(d) for any reason, the Credit Parties will issue Capital Call
Notices in an amount sufficient to cure such Implicit Borrowing Base Deficit and
will pay the mandatory prepayment prior to permitting the consummation of any
such transfer.
 
(b) Admission of Investors.  No Credit Party shall admit any Person as an
additional Investor without the prior written consent of Administrative Agent
acting alone, such consent not to be unreasonably withheld.
 
(c) Documentation Requirements.  Each Borrower shall require that: (i) any
Person admitted as a substitute or new Included Investor or Designated Investor
(whether due to a transfer by an existing Investor or otherwise) (a “Subsequent
Investor”) shall, as a condition to such admission, deliver an Investor Letter
and provide other documentation similar to that described in Section 8.1(p)
satisfactory to Administrative Agent in its reasonable discretion; (ii) comply
with all requirements herein for an Included Investor or Designated Investor, as
applicable, and (iii) any existing Included Investor or Designated Investor that
is a transferee from another Investor shall provide confirmation of its
obligations under its Investor Letter with respect to any increase in its
Capital Commitment relating to such transfer, and, to the extent not addressed
in the documentation previously delivered by such Investor, evidence of its
authority to assume such increased Capital Commitment, all as satisfactory to
Administrative Agent in its reasonable discretion.  Any substitute or new
Investor that is unable to comply with the requirements of this Section 11.5(c)
shall be a Non-Included Investor and be excluded from the Borrowing Base.  In
the event any Person is admitted as a Subsequent Investor, Borrowers will
promptly deliver to Administrative Agent a revised Exhibit A to this Credit
Agreement, containing the names and addresses of each Investor and the Capital
Commitments of each.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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11.6. Capital Commitments.  No Credit Party shall: (a) without the prior written
consent of Administrative Agent, which may be withheld in its sole discretion,
cancel, reduce, excuse, suspend or defer the Capital Commitment of any
non-Included Investor; and (b) without the prior written approval of
Administrative Agent and all Lenders: (i) issue any Capital Call Notices other
than as contemplated by Section 5.2(c); (ii) cancel, reduce, excuse, suspend or
defer the Capital Commitment of any Included Investor or Designated Investor; or
(iii) excuse any Investor from or permit any Investor to defer any Capital
Contribution, if the proceeds from the related Capital Call Notice are to be
applied to the Obligations hereunder.
 
11.7. ERISA Compliance.  No Credit Party shall establish or maintain any
Plan.  Without the approval of all Lenders, no Credit Party will take any action
that would cause its underlying assets to constitute Plan Assets.
 
11.8. Environmental Matters.  Except for such conditions as are in or will
promptly be brought into compliance with relevant Environmental Laws or
otherwise would not reasonably be expected to result in a Material Adverse
Effect, no Credit Party: (a) shall cause any Hazardous Material to be generated,
placed, held, located or disposed of on, under or at, or transported to or from,
any Property of any Credit Party in material violation of Environmental Law; or
(b) shall permit any such Property to ever be used as a dump site or storage
site (whether permanent or temporary) for any Hazardous Material in material
violation of Environmental Law.
 
11.9. Dissolution.  Without the prior written consent of the Administrative
Agent and all Lenders, no Credit Party will take any action to dissolve or
terminate any Credit Party.
 
11.10. Limitations on Dividends and Distributions.
 
(a) No Credit Party shall declare or pay any dividends or distributions except
as permitted under its Constituent Documents.
 
(b) No Credit Party shall declare or pay any dividends or distributions if:
(i) any Event of Default exists; or (ii) a Potential Default exists.
 
11.11. Limitation on Debt.  (a) Borrower shall not, without the prior written
consent of the Administrative Agent and the Required Lenders, incur, together
with its Affiliates on a consolidated basis in accordance with GAAP, (i)
aggregate Indebtedness (including the Obligations) in an amount in excess of
that permitted under the Operating Agreement; or (ii) any recourse debt (other
than its obligations under this Credit Agreement) in excess of twenty-five (25%)
percent of amounts under Section 11.11(a)(i); and (b) Pledgor shall not incur
any Indebtedness (other than its obligations under this Credit Agreement).
 
11.12. Limitation on Managing Member’s Activities.  The Managing Member shall
not: (a) without the prior written consent of the Administrative Agent and the
Required Lenders: (i) take any actions that will cause the Managing Member or
the Borrower to dissolve, terminate, merge or consolidate; or (ii) create or
suffer to exist any mortgage, pledge, lien, or other security interest upon its
Membership Interest in Borrower; or (b) transfer its Membership Interest in
Borrower without the prior written consent of Administrative Agent and the
Required Lenders.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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11.13. Limitation on Pledgor’s Activities.  Pledgor shall not: (a) without the
prior written consent of the Administrative Agent and the Required Lenders:
(i) take any actions that will cause the Pledgor to dissolve, terminate, merge
or consolidate; or (ii) create or suffer to exist any mortgage, pledge, lien, or
other security interest upon its Membership Interest in Borrower; or
(b) transfer its Membership Interest in Borrower without the prior written
consent of Administrative Agent and the Required Lenders.
 
11.14. Limitation on Guarantor’s Activities.  Guarantor shall not: (a) without
the prior written consent of the Administrative Agent and the Required Lenders:
(i) take any actions that will cause the Guarantor or Acadia Realty Acquisition
III LLC to dissolve, terminate, merge or consolidate; or (ii) create or suffer
to exist any mortgage, pledge, lien, or other security interest upon its equity
interest in Acadia Realty Acquisition III LLC or permit Acadia Realty
Acquisition III LLC to create or suffer to exist any mortgage, pledge, lien, or
other security interest upon its Membership Interest in Borrower; or
(b) transfer its equity interest in Acadia Realty Acquisition III LLC or permit
Acadia Realty Acquisition III LLC to transfer its Membership Interest in
Borrower, in each case without the prior written consent of Administrative Agent
and the Required Lenders.
 
11.15. Investor Withdrawal.  No Credit Party shall take any action which would
permit any Investor to withdraw (unless a prepayment is made such that no
Implicit Borrowing Base Deficit would occur as a result of such withdrawal) from
any Credit Party in accordance with the Operating Agreement, Partnership
Agreement, or the Stockholders Agreement, as applicable.
 
12. EVENTS OF DEFAULT
 
12.1. Events of Default.  An “Event of Default” shall exist if any one or more
of the following events (herein collectively called “Events of Default”) shall
occur and be continuing:
 
(a) (i) Borrower or any Qualified Borrower shall fail to pay when due any
principal of the Obligations; or (ii) any Credit Party or any Qualified Borrower
shall fail to pay when due any interest on the Obligations or any fee, expense,
or other payment required hereunder, including, without limitation, payment of
cash for deposit as cash collateral as required hereunder, and such failure
under this clause (ii) shall continue for one (1) Business Day thereafter
(except for the failure to pay the Obligations in full on the Maturity Date for
which no notice shall be required and except for the failure to prepay any
amount required under Section 2.1(d) hereof for which no additional notice shall
be required);
 
(b) any representation or warranty made by any Credit Party or any Qualified
Borrower under this Credit Agreement, or any of the other Loan Documents
executed by either of them, or in any certificate or statement furnished or made
to Lenders or any of them by any Credit Party or any Qualified Borrower pursuant
hereto or in connection herewith or with the Loans, shall prove to be untrue or
inaccurate in any material respect as of the date on which such representation
or warranty is made;
 
(c) default shall occur in the performance of any of the covenants or agreements
contained herein (other than the covenants contained in Section 2.1(d) or
Section 11), or of the covenants or agreements of any Credit Party or any
Qualified Borrower contained in any other Loan Documents executed by such
Person, and such default shall continue uncured to the satisfaction of
Administrative Agent for a period of thirty (30) days after written notice
thereof has been given by Administrative Agent to Borrower, unless it cannot be
cured within thirty (30) days and provided the party is diligently proceeding to
cure (provided that such thirty (30)-day cure period shall not apply respecting
covenants of a Credit Party relating to notices to be given by a Credit Party,
but a three (3)-day grace period shall apply);
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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(d) default shall occur in the performance of the covenants or agreements of
Borrower or any Qualified Borrower contained in Section 2.1(d) or Section 11;
 
(e) any of the Loan Documents executed by a Credit Party or any Qualified
Borrower shall cease, in whole or in material part, to be legal, valid, binding
agreements enforceable against the Credit Parties or such Qualified Borrower in
accordance with the terms thereof or shall in any way be terminated or become or
be declared ineffective or inoperative or shall in any way whatsoever cease to
give or provide the respective liens, security interest, rights, titles,
interest, remedies, powers, or privileges intended to be created thereby;
 
(f) default shall occur in the payment of any recourse indebtedness or Guaranty
Obligation of Borrower or Guarantor (other than the Obligations), in an
aggregate amount greater than or equal to $10,000,000, and such default shall
continue for more than the applicable period of grace, if any;
 
(g) any Credit Party shall: (i) apply for or consent to the appointment of a
receiver, trustee, custodian, intervenor, or liquidator of itself or of all or a
substantial part of its assets; (ii) file a voluntary petition in bankruptcy or
admit in writing that it is unable to pay its debts as they become due;
(iii) make a general assignment for the benefit of creditors; (iv) file a
petition or answer seeking reorganization or an arrangement with creditors or to
take advantage of any Debtor Relief Laws; (v) file an answer admitting the
material allegations of, or consent to, or default in answering, a petition
filed against it in any bankruptcy, reorganization or insolvency proceeding; or
(vi) take partnership or corporate action for the purpose of effecting any of
the foregoing;
 
(h) a case or proceeding shall be commenced, without application or consent of
any Credit Party, in any court, seeking an order for relief under the Bankruptcy
Code, to adjudicate if bankrupt or insolvent or seeking the liquidation,
reorganization, debt arrangement, dissolution, winding up or composition or
readjustment of debts of any Credit Party, the appointment of a trustee,
receiver, custodian, liquidator, assignee or sequestor (or similar official) for
such Person or all or substantially all of the assets of such Person, or any
similar action with respect to such Person under any existing or future law of
any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization, winding up or composition or adjustment of debts, and such case
or proceeding shall continue undismissed, or unstayed or in effect, for a period
of sixty (60) consecutive days or results in the entering of an order for relief
or any such adjudication or appointment
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
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(i) any final judgment(s) for the payment of money in excess of the sum of
$5,000,000 in the aggregate shall be rendered against any Credit Party and such
judgment or judgments remain unsatisfied for a period of sixty (60) days or
would reasonably be expected to have a Material Adverse Effect, unless covered
by insurance or unless being appealed and the applicable Credit Party or such
Qualified Borrower has posted a bond or cash collateral;
 
(j) Managing Member shall cease to be the sole Managing Member of Borrower or
Managing Member shall be removed as the Managing Member of Borrower;
 
(k) Managing Member shall repudiate, challenge, or declare unenforceable its
obligation to make contributions to the capital of Borrower pursuant to its
Capital Commitments or shall otherwise disaffirm the provisions of the Operating
Agreement;
 
(l) there shall occur any change in the condition (financial or otherwise) of
any Credit Party which, in the reasonable judgment of Administrative Agent, has
a Material Adverse Effect (it being understood that the occurrence of Exclusion
Events in respect of one or more Investors is not, in and of itself, an event
constituting a Material Adverse Effect);
 
(m) Pledgor shall repudiate, challenge, or declare unenforceable its obligation
to make contributions to the capital of Borrower pursuant to its Capital
Commitments or shall otherwise disaffirm the provisions of the Operating
Agreement or shall repudiate, challenge, declare unenforceable or default under
its obligations under the Capital Contributions Pledge Agreement;
 
(n) the removal of the Managing Member pursuant to Section 10.2(a) of the
Operating Agreement or the removal of the Acadia D.R. Management Inc. pursuant
to Section 5.2 of the Stockholders Agreement;
 
(o) Guarantor shall repudiate, challenge declare unenforceable or default under
its obligations under the Guaranty of Capital; or
 
(p) the Borrowing Base Deficit is greater than zero (0) and is not eliminated
within one (1) Business Day.
 
12.2. Remedies Upon Event of Default.  If an Event of Default shall have
occurred and be continuing, then Administrative Agent may, and, upon the
direction of the Required Lenders, shall:  (a) suspend the Commitments of
Lenders until such Event of Default is cured; (b) terminate the Commitment of
Lenders hereunder; (c) declare the principal of, and all interest then accrued
on, the Obligations to be forthwith due and payable (including the liability to
fund the Letter of Credit Liability pursuant to Section 2.5(g) hereof),
whereupon the same shall forthwith become due and payable without presentment,
demand, protest, notice of default, notice of acceleration, or of intention to
accelerate or other notice of any kind all of which each of Borrower, each
Qualified Borrower and each other Credit Party hereby expressly waives, anything
contained herein or in any other Loan Document to the contrary notwithstanding;
(d) require that the Borrower Parties Cash Collateralize the Letter of Credit
Liability; (e) exercise any right, privilege, or power set forth in Section 5.2
hereof, including, but not limited to, the initiation of Capital Call Notices of
the Capital Commitments; or (f) without notice of default or demand, pursue and
enforce any of Administrative Agent’s or Lenders’ rights and remedies under the
Loan Documents, or otherwise provided under or pursuant to any applicable law or
agreement; provided, however, that if any Event of Default specified in
Section 12.1(g) or 12.1(h) hereof shall occur, the principal of, and all
interest on, the Obligations shall thereupon become due and payable concurrently
therewith, without any further action by Administrative Agent or Lenders, or any
of them, and without presentment, demand, protest, notice of default, notice of
acceleration, or of intention to accelerate or other notice of any kind, all of
which each of Borrower, each Qualified Borrower and Guarantor hereby expressly
waives.
 
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12.3. Performance by Administrative Agent.  Should any Credit Party or any fail
to perform any covenant, duty, or agreement contained herein or in any of the
Loan Documents, and such failure continues beyond any applicable cure period,
Administrative Agent may, but shall not be obligated to, perform or attempt to
perform such covenant, duty, or agreement on behalf of such Person.  In such
event, each Credit Party shall, at the request of Administrative Agent promptly
pay any amount expended by Administrative Agent in such performance or attempted
performance to Administrative Agent, together with interest thereon at the
Default Rate from the date of such expenditure until paid.  Notwithstanding the
foregoing, it is expressly understood that neither any of the Agents nor any of
the other Secured Parties assume any liability or responsibility for the
performance of any duties any Credit Party, or any related Person hereunder or
under any of the Loan Documents or other control over the management and affairs
of any Credit Party, or any related Person, nor by any such action shall any of
the Agents or any of the other Secured Parties be deemed to create a partnership
arrangement with any Credit Party or any related Person.
 
13. AGENCY PROVISIONS
 
13.1. Appointment and Authorization of Agents.
 
(a) Authority.  Each Lender (including any Person that is an assignee,
participant, secured party or other transferee with respect to the interest of
such Lender in any Principal Obligation or otherwise under this Credit
Agreement) (collectively with such Lender, a “Lender Party”) hereby irrevocably
appoints, designates and authorizes each Agent (other than a Managing Agent for
a different Lender Group) to take such action on its behalf under the provisions
of this Credit Agreement and the other Loan Documents and to exercise such
powers and perform such duties as are expressly delegated to such Agent by the
terms hereof and of the other Loan Documents, together with such other powers as
are reasonably incidental thereto.  Notwithstanding any provision to the
contrary elsewhere herein and in any other Loan Documents, no Agent shall have
any duties or responsibilities, except those expressly set forth herein and
therein, nor shall any Agent have or be deemed to have any fiduciary
relationship with any Lender Party, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Credit Agreement or any of the other Loan Documents or otherwise exist against
any Agent.  Without limiting the generality of the foregoing sentence, the use
of the term “agent” herein and in the other Loan Documents with reference to any
Agent is not intended to connote any fiduciary or other implied (or express)
obligations arising under agency doctrine of any applicable Law.  Instead, such
term is used merely as a matter of market custom, and is intended to create or
reflect only an administrative relationship between independent contracting
parties.
 
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(b) Release of Collateral.  The Secured Parties irrevocably authorize
Administrative Agent, at Administrative Agent’s option and in its discretion, to
release any security interest in or Lien on any Collateral granted to or held by
Administrative Agent: (i) upon termination of this Credit Agreement and the
other Loan Documents, termination of the Commitments and all Letters of Credit
(or the Cash Collateralization in full of all Letters of Credit), and payment in
full of all Obligations, including all fees and indemnified costs and expenses
that are then due and payable pursuant to the terms of the Loan Documents; and
(ii) if approved by the requisite Lenders pursuant to the terms of
Section 14.1.  Upon the request of Administrative Agent, the Lenders will
confirm in writing Administrative Agent’s authority to release particular types
or items of Collateral pursuant to this Section 13.1(b).
 
(c) Limitation on Beneficiaries.  The provisions of Sections 13.1 through 13.8
and Section 13.10 are solely for the benefit of the Administrative Agent, the
Lenders, the Letter of Credit Issuer and the other Secured Parties, and no
Credit Party shall have rights as a third party beneficiary of any of such
provisions.
 
13.2. Delegation of Duties.  Each Agent may execute any of its duties under this
Credit Agreement or under the other Loan Documents by or through agents or
attorneys-in-fact and shall be entitled to advice of legal counsel, accountants,
and other professionals concerning all matters pertaining to such duties.  No
Agent shall be responsible for the negligence or misconduct of any agent or
attorney-in-fact that it selects in the absence of gross negligence or willful
misconduct.
 
13.3. Exculpatory Provisions.  No Agent-Related Person shall be liable for any
action taken or omitted to be taken by it under or in connection herewith or in
connection with any of the other Loan Documents or the transactions contemplated
hereby (except for its own gross negligence or willful misconduct) or be
responsible in any manner to any of the Lenders for any recitals, statements,
representations or warranties made by any of the Credit Parties contained herein
or in any of the other Loan Documents or in any certificate, report, document,
financial statement or other written or oral statement referred to or provided
for therein, or received by such Agent under or in connection herewith or in
connection with the other Loan Documents, or enforceability or sufficiency of
this Credit Agreement of any of the other Loan Documents, or for any failure of
any Credit Party to perform its obligations hereunder or thereunder.  No
Agent-Related Person shall be responsible to any Lender to ascertain or inquire
as to the performance or observance of any of the terms, conditions, provisions,
covenants or agreements contained herein or in the other Loan Documents or as to
the use of the proceeds of the Loans or the use of the Letters of Credit or of
the existence or possible existence of any Potential Default or Event of Default
or to inspect the properties, books or records of the Credit Parties.  The
Agents are not trustees for the Lenders and owe no fiduciary duty to the Lender
Groups.  Each Lender recognizes and agrees that Administrative Agent shall not
be required to determine independently whether the conditions described in
Sections 8.2(a) or 8.2(b) have been satisfied and, when Administrative Agent
disburses funds to Borrower or a Qualified Borrower or the Letter of Credit
Issuer causes Letters of Credit to be issued, it may rely fully upon statements
contained in the relevant requests by a Borrower Party.
 
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13.4. Reliance on Communications.  The Agents shall be entitled to rely, and
shall be fully protected in relying, upon any note, writing, resolution, notice,
consent, certificate, affidavit, letter, cablegram, telegram, facsimile, telex
or telephone message, statement, order or other document or conversation
believed by it to be genuine and correct and to have been signed, sent or made
by the proper Person or Persons and upon advice and statements of legal counsel
(including, without  limitation, counsel to any of the Credit Parties,
independent accountants and other experts selected by the Agents with reasonable
care).  Each Agent may deem and treat each Lender as the owner of its interests
hereunder for all purposes unless a written notice of assignment, negotiation or
transfer thereof shall have been filed with Administrative Agent in accordance
with Section 14.12(b).  Each Agent shall be fully justified in failing or
refusing to take any action under this Credit Agreement or under any of the
other Loan Documents unless it shall first receive such advice or concurrence of
the Lenders as it deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such
action.  Each Agent shall in all cases be fully protected in acting, or in
refraining from acting, hereunder or under any of the other Loan Documents in
accordance with a request of the Required Lenders (or to the extent specifically
required, all of the Lenders) and such request and any action taken or failure
to act pursuant thereto shall be binding upon all the Lenders (including their
successors and assigns).
 
13.5. Notice of Default.  No Agent shall be deemed to have knowledge or notice
of the occurrence of any Potential Default or Event of Default hereunder unless
such Agent has received notice from a Lender or a Borrower Party referring to
the Loan Document, describing such Potential Default or Event of Default and
stating that such notice is a “notice of potential default or event of
default.”  Each Agent will notify the Lenders of its receipt of any such notice,
and Administrative Agent shall take such action with respect to such Potential
Default or Event of Default as shall be reasonably directed by the requisite
Lenders and as is permitted by the Loan Documents; provided, however, that
unless and until the Administrative Agent shall have received any such request,
Administrative Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Potential Default or Event
of Default as it shall deem advisable or in the best interest of the Lenders.
 
13.6. Non-Reliance on Agents and Other Lenders.  Each Lender expressly
acknowledges that no Agent-Related Person or Arranger nor any of their officers,
directors, employees, agents, attorneys-in-fact or affiliates has made any
representations or warranties to it and that no act by any Agent-Related Person
or Arranger hereafter taken, including any consent to any acceptance of any
assignment or review of the affairs of any Borrower Party or any of its
Affiliates, shall be deemed to constitute any representation or warranty by the
Agent-Related Person or Arranger to any Lender.  Each Lender, including any
Lender by assignment, represents to each Agent and Arranger that it has,
independently and without reliance upon any Agent-Related Person, any Arranger
or any other Lender, and based on such documents and information as it has
deemed appropriate, made its own appraisal of and investigation into the
business, assets, operations, property, financial and other conditions,
prospects and creditworthiness of each Credit Party (or its Affiliates) and all
applicable bank regulatory laws related to the transactions contemplated hereby
and made its own decision to make its Loans hereunder and enter into this Credit
Agreement.  Each Lender also represents that it shall, independently and without
reliance upon any Agent-Related Person, any Arranger or any other Lender, and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit analysis, appraisals and decisions in
taking or not taking action under this Credit Agreement and the other Loan
Documents, and to make such investigation as it deems necessary to inform itself
as to the business, assets, operations, property, financial and other
conditions, prospects and creditworthiness of any Borrower Party (or its
Affiliates).  Except for notices, reports and other documents expressly required
to be furnished to the Lenders by Administrative Agent hereunder, neither any
Agent nor any Arranger shall have any duty or responsibility to provide any
Lender with any credit or other information concerning the business, operations,
assets, property, financial or other conditions, prospects or creditworthiness
of the Borrower Parties which may come into the possession of any Agent-Related
Person or Arranger or any of their officers, directors, employees, agents,
attorneys-in-fact or affiliates.
 
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13.7. Indemnification.  Whether or not the transactions contemplated hereby are
consummated, the Alternate Lenders shall indemnify, upon demand, each
Agent-Related Person (to the extent not reimbursed by a Borrower Party and
without limiting the obligation of the Borrower Parties to do so), ratably in
accordance with the applicable Alternate Lender’s respective Alternate Lender
Pro Rata Share of its Lender Group’s Lender Group Percentage, and hold harmless
each Agent-Related Person from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind whatsoever which may at any time (including without
limitation at any time following payment in full of the Obligations) be imposed
on, incurred by or asserted against it in its capacity as such in any way
relating to or arising out of this Credit Agreement or the other Loan Documents
or any documents contemplated by or referred to herein or therein or the
transactions contemplated hereby or thereby or any action taken or omitted by it
under or in connection with any of the foregoing; provided that no Lender shall
be liable for the payment of any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements resulting from such Person’s gross negligence or willful
misconduct, as finally determined by a court of competent jurisdiction or
related to another Lender Group’s Managing Agent; provided, further, that no
action taken in accordance with the directions of the Required Lenders or all
Lenders, as applicable, shall be deemed to constitute gross negligence or
willful misconduct for purposes of this Section 13.7.  Without limitation of the
foregoing, each Alternate Lender shall reimburse Administrative Agent, the
Letter of Credit Issuer and its Managing Agent upon demand for its ratable share
of any costs or out-of-pocket expenses (including Attorney Costs) incurred by
such Agent in connection with the preparation, execution, delivery,
administration, modification, amendment or enforcement (whether through
negotiations, legal proceedings or otherwise) of, or legal advice in respect of
rights or responsibilities under, this Credit Agreement, any other Loan
Document, or any document contemplated by or referred to herein, to the extent
that such Agent is not reimbursed for such expenses by or on behalf of the
Borrower Parties.  The agreements in this Section 13.7 shall survive the
termination of the Commitments, payment of all of the Obligations hereunder and
under the other Loan Documents or any documents contemplated by or referred to
herein or therein, as well as the resignation or replacement of any Agent.
 
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13.8. Agents in Their Individual Capacity.  Each Agent (and any successor acting
as an Agent) and its Affiliates may make loans to, issue letters of credit for
the account of, accept deposits from, acquire equity interests in, and generally
engage in any kind of banking, trust, financial advisory, underwriting or other
business with any Credit Party (or any of its subsidiaries or Affiliates) as
though such Agent were not an Agent or a Lender hereunder and without notice to
or consent of the Lenders.  The Lenders acknowledge that, pursuant to such
activities, any Agent or its Affiliates may receive information regarding the
Credit Parties or their Affiliates (including information that may be subject to
confidentiality obligations in favor of such Person) and acknowledge that such
Agent shall be under no obligation to provide such information to them.  With
respect to the Loans made and Letters of Credit issued and all obligations owing
to it, an Agent acting in its individual capacity shall have the same rights and
powers under this Credit Agreement as any Lender and may exercise the same as
though it were not an Agent, and the terms “Lender” and “Lenders” shall include
each Agent in its individual capacity.
 
13.9. Successor Agent.  Any Agent may, at any time, resign upon twenty (20) days
written notice to the Lenders and the Credit Parties.  Upon any such resignation
of the Administrative Agent, the Required Lenders shall appoint a successor
Administrative Agent from any of the Alternate Lenders, in consultation with the
Borrower.  If no successor agent is appointed prior to the effective date of the
resignation of the applicable Agent, then the retiring Agent may appoint, after
consulting with the Lenders and the Borrower, a successor Agent from any of the
Alternate Lenders.  Upon the acceptance of its appointment as successor agent
hereunder, such successor agent shall thereupon succeed to all the rights,
powers and duties of the retiring Agent, and shall assume the duties and
obligations of such retiring Agent, and the retiring Agent shall be discharged
from its duties and obligations as Agent under this Credit Agreement and the
other Loan Documents.  After any retiring Agent’s resignation hereunder as
Agent, the provisions of this Section 13.9 and Sections 14.3 and 13.8 shall
inure to its benefit as to any actions taken or omitted to be taken by it while
it was an Agent under this Credit Agreement.  If no successor agent has accepted
appointment as Agent by the date which is thirty (30) days following a retiring
Agent’s notice of resignation, the retiring Agent’s resignation shall
nevertheless thereupon become effective and the applicable Alternate Lenders
shall perform all of the duties of the Agent hereunder until such time, if any,
as the Required Lenders appoint a successor agent as provided for above.
 
13.10. No Other Duties, Etc.  Anything herein to the contrary notwithstanding,
no Agent shall have any powers, duties or responsibilities under this Credit
Agreement or any of the other Loan Documents, except in its capacity, as
applicable, as Administrative Agent, a Lender or the Letter of Credit Issuer
hereunder.
 
13.11. Administrative Agent May File Proofs of Claim.  In case of the pendency
of any receivership, insolvency, liquidation, bankruptcy, reorganization,
arrangement, adjustment, composition or other judicial proceeding relative to
any Credit Party, Administrative Agent (irrespective of whether the principal of
any Loan or Letter of Credit Liability shall then be due and payable as herein
expressed or by declaration or otherwise and irrespective of whether
Administrative Agent shall have made any demand on Credit Parties) shall be
entitled and empowered, by intervention in such proceeding or otherwise:
 
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(a) to file and prove a claim for the whole amount of the principal and interest
owing and unpaid in respect of the Loans, Letter of Credit Liability and all
other Obligations that are owing and unpaid and to file such other documents as
may be necessary or advisable in order to have the claims of the Secured Parties
(including any claim for the reasonable compensation, expenses, disbursements
and advances of the Secured Parties and their respective agents and counsel and
all other amounts due the Secured Parties hereunder) allowed in such judicial
proceeding; and
 
(b) to collect and receive any monies or other property payable or deliverable
on any such claims and to distribute the same;
 
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Secured Party to make such payments to Administrative Agent and, in the
event that Administrative Agent shall consent to the making of such payments
directly to the Secured Party, to pay to Administrative Agent any amount due for
the reasonable compensation, expenses, disbursements and advances of
Administrative Agent and its agents and counsel, and any other amounts due the
Administrative Agent hereunder.
 
Nothing contained herein shall be deemed to authorize Administrative Agent to
authorize or consent to or accept or adopt on behalf of any Secured Party any
plan of reorganization, arrangement, adjustment or composition affecting the
Obligations or the rights of any Secured Party or to authorize Administrative
Agent to vote in respect of the claim of any Secured Party in any such
proceeding.
 
14. MISCELLANEOUS
 
14.1. Amendments.  Neither this Credit Agreement nor any other Loan Document,
nor any of the terms hereof or thereof, may be amended, waived, discharged or
terminated, unless such amendment, waiver, discharge, or termination is in
writing and signed by Administrative Agent, based upon the approval of the
appropriate number of Lenders required hereunder, or such Lenders, on the one
hand, and the Credit Parties, on the other hand; and, if the rights or duties of
an Agent are affected thereby, by such Agent, provided that no such amendment,
waiver, discharge, or termination shall, without the consent of:
 
(a) each Lender affected thereby:
 
(i) reduce or increase the amount or alter the term of the Commitment of such
Lender, or alter the provisions relating to any fees (or any other payments)
payable to such Lender;
 
(ii) extend the time for payment for the principal of or interest on the
Obligations, or fees or costs, or reduce the principal amount of the Obligations
(except as a result of the application of payments or prepayments), or reduce
the rate of interest borne by the Obligations (other than as a result of waiving
the applicability of the Default Rate), or otherwise affect the terms of payment
of the principal of or any interest on the Obligations or fees or costs
hereunder;
 
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(iii) release any Liens granted under the Collateral Documents, except as
otherwise contemplated herein or therein, and except in connection with the
transfer of interests in a Credit Party permitted hereunder or in any other Loan
Documents;
 
(iv) release the Guaranty granted pursuant to the Guaranty of Capital or limit
or otherwise modify the liability of Guarantor under any of the Loan Documents;
and
 
(v) extend the Stated Maturity Date or Maturity Date;
 
(b) all Lenders:
 
(i) permit the cancellation, excuse or reduction of the Capital Commitment of
any Included Investor or Designated Investor;
 
(ii) amend the definitions of (A) “Applicable Requirement”; (B) “Available Loan
Amount”; (C) “Eligible Available Contributions of the Designated Investors”; (D)
“Eligible Available Contributions of the Included Investors”; (E) “Included
Investor”; (F) “Inclusion Percentage”; (G) “Designated Investor”; (H) “Unfunded
Capital Commitment”; (I) “Borrowing Base”; or (J) “Exclusion Event”;
 
(iii) change the percentages specified in the definition of Required Lenders or
any other provision hereof specifying the number or percentage of Lenders which
are required to amend, waive or modify any rights hereunder or otherwise make
any determination or grant any consent hereunder;
 
(iv) consent to the assignment or transfer by a Credit Party of any of their
respective rights and obligations under (or in respect of) the Loan Documents;
or
 
(v) amend, waive or in any way modify or suspend any provision requiring the pro
rata application of payments of the Obligations to Lenders; or
 
(vi) amend the terms of this Section 14.1.
 
Administrative Agent agrees that it will promptly notify the Managing Agents
(who will in turn promptly notify the Lenders in its Lender Group) of any
proposed modification or amendment to any Loan Document, and deliver drafts of
any such proposed modification or amendment to the Managing Agents (who will in
turn promptly deliver to the Lenders in its Lender Group), prior to the
effectiveness of such proposed modification or amendment.  Notwithstanding the
above:  (A) no provisions of Section 13 may be amended or modified without the
consent of Administrative Agent; (B) no provisions of Section 2.5 may be amended
or modified without the consent of the Letter of Credit Issuer; and
(C) Sections 10 and 11 specify the requirements for waivers of the affirmative
covenants and negative covenants listed therein, and any amendment to any
provision of Section 10 or Section 11 shall require the consent of the Lenders
that are specified therein as required for a waiver thereof.  Any amendment,
waiver or consent not specifically addressed in this Section 14.1 or otherwise
shall be subject to the approval of Required Lenders.
 
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Notwithstanding the fact that the consent of all the Lenders is required in
certain circumstances as set forth above and in Section 11: (1) each Lender is
entitled to vote as such Lender sees fit on any reorganization plan that affects
the Loans or the Letters of Credit, and each Lender acknowledges that the
provisions of Section 1126(c) of the Bankruptcy Code supersede the unanimous
consent provisions set forth herein; (2) the Required Lenders may consent to
allow a Borrower Party to use cash collateral in the context of a bankruptcy or
insolvency proceeding; and (3) Administrative Agent may, in its sole discretion,
agree to the modification or waiver of any of the other terms of this Credit
Agreement or any other Loan Document or consent to any action or failure to act
by any Credit Party, if such modification, waiver, or consent is of an
administrative nature.
 
If Administrative Agent shall request the consent of any Lender to any
amendment, change, waiver, discharge, termination, consent or exercise of rights
covered by this Credit Agreement, and not receive such consent or denial thereof
in writing within ten (10) Business Days of the making of such request by
Administrative Agent, as the case may be, such Lender shall be deemed to have
given its consent to the request.
 
14.2. Setoff.  In addition to any rights and remedies of the Lenders provided by
law, upon the occurrence and during the continuance of any Event of Default,
each Lender is authorized at any time and from time to time, without prior
notice to any Credit Party or any other obligor, any such notice being waived by
each Credit Party (on its own behalf and on behalf of each obligor) to the
fullest extent permitted by law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held by,
and other indebtedness at any time owing by, such Lender to or for the credit or
the account of any Credit Party against any and all of the Obligations owing to
such Lender, now or hereafter existing, irrespective of whether or not
Administrative Agent or such Lender shall have made demand under this Credit
Agreement or any other Loan Document and although such Obligations may be
contingent or unmatured.  Each Lender agrees promptly to notify the applicable
Credit Party and Administrative Agent after any such setoff and application made
by such Lender; provided, however, that the failure to give such notice shall
not affect the validity of such set-off and application.
 
14.3. Sharing of Payments.  If, other than as expressly provided elsewhere
herein, any Lender shall obtain on account of the Loans made by it or the
participations in Letters of Credit held by it, any payment (whether voluntary,
involuntary, through the exercise of any right of setoff, the receipt of any
proceeds from a Capital Call or the exercise of any remedies under any
Collateral Documents, or otherwise) in excess of its ratable share (or other
share contemplated hereunder) thereof, such Lender shall immediately: (a) notify
Administrative Agent of such fact; and (b) purchase from the other Lenders such
participations in the Loans made by them and/or such subparticipations in the
participations in Letters of Credit held by them, as the case may be, as shall
be necessary to cause such purchasing Lender to share the excess payment in
respect of such of Loans or such participations, as the case may be, pro rata
with each of them; provided, however, that if all or any portion of such excess
payment is thereafter recovered from the purchasing Lender, such purchase shall
to that extent be rescinded and each other Lender shall repay to the purchasing
Lender the purchase price paid therefor, together with an amount equal to such
paying Lender’s ratable share (according to the proportion of: (i) the amount
that such paying Lender’s required repayment bears to; (ii) the total amount so
recovered from the purchasing Lender) of any interest or other amount paid or
payable by the purchasing Lender in respect of the total amount so
recovered.  Each Credit Party agrees that any Lender so purchasing a
participation from another Lender may, to the fullest extent permitted by law,
exercise all its rights of payment (including the right of setoff, but subject
to Section 14.2) with respect to such participation as fully as if such Lender
were the direct creditor of the Credit Parties in the amount of such
participation.  Administrative Agent will keep records (which shall be
conclusive and binding in the absence of manifest error) of participations
purchased under this Section 14.3 and will in each case notify the Lenders
following any such purchases or repayments.  Each Lender that purchases a
participation pursuant to this Section shall from and after such purchase have
the right to give all notices, requests, demands, directions and other
communications under this Credit Agreement with respect to the portion of the
Obligations purchased to the same extent as though the purchasing Lender were
the original owner of the Obligations purchased.  To the extent required to
implement the sharing of payments under this Section 14.3, each Lender hereby
authorizes and directs Administrative Agent to distribute any proceeds from
Capital Calls or proceeds from the exercise of remedies under the Collateral
Documents held by Administrative Agent to Lenders consistent with the terms of
this Section 14.3.
 
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14.4. Payments Set Aside.  To the extent that any Credit Party makes a payment
to Administrative Agent or any Lender, or Administrative Agent or any Lender
exercises its right of setoff, and such payment or the proceeds of such setoff
or any part thereof is subsequently invalidated, declared to be fraudulent or
preferential, set aside or required (including pursuant to any settlement
entered into by Administrative Agent or such Lender in its discretion) to be
repaid to a trustee, receiver or any other party, in connection with any
proceeding under any Debtor Relief Law or otherwise, then: (a) to the extent of
such recovery, the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such setoff had not occurred, and (b) each
Alternate Lender severally agrees to pay to Administrative Agent upon demand its
applicable share of any amount so recovered from or repaid by Administrative
Agent, plus interest thereon from the date of such demand to the date such
payment is made at a rate per annum equal to the Federal Funds Rate from time to
time in effect.
 
14.5. Waiver.  No failure to exercise, and no delay in exercising, on the part
of Administrative Agent or Lenders, any right hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise thereof preclude any
other further exercise thereof or the exercise of any other right.  The rights
and remedies of the Agents and Lenders hereunder and under the Loan Documents
shall be in addition to all other rights provided by law.  No modification or
waiver of any provision of this Credit Agreement, the Notes or any of the other
Loan Documents, nor consent to departure therefrom, shall be effective unless in
writing and no such consent or waiver shall extend beyond the particular case
and purpose involved.  No notice or demand given in any case shall constitute a
waiver of the right to take other action in the same, similar or other instances
without such notice or demand.  Subject to the terms of this Credit Agreement,
including Section 14.1, Administrative Agent acting on behalf of all Lenders
(pursuant to the terms hereof), and the Credit Parties may from time to time
enter into agreements amending or changing any provision of this Credit
Agreement or the rights of Lenders or the Credit Parties hereunder, or may grant
waivers or consents to a departure from the due performance of the obligations
of the Credit Parties hereunder, any such agreement, waiver or consent made with
such written consent of Administrative Agent being effective to bind all
Lenders.
 
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14.6. Payment of Expenses.
 
(a) Borrower agrees to pay (within ten (10) days after the receipt of written
notice from Administrative Agent) all out-of-pocket costs and expenses of
Administrative Agent (including without limitation Attorney Costs) reasonably
incurred by it in connection with the negotiation, preparation, execution and
delivery of this Credit Agreement, the Notes, and the other Loan Documents and
any and all amendments, modifications and supplements thereof or thereto, and,
subject to no gross negligence or willful misconduct on the part of the Lenders,
all out-of-pocket costs and expenses of Administrative Agent and the Secured
Parties (including, without limitation, the Attorney Costs of Administrative
Agent’s and the Secured Parties’ legal counsel) reasonably incurred by them in
connection with the preservation, enforcement and modification of, and
Administrative Agent’s and the Secured Parties’ rights under, this Credit
Agreement, the Notes, and the other Loan Documents.
 
(b) Borrower agrees to indemnify Administrative Agent and each of Lenders and
their respective directors, officers, employees, attorneys and agents (each such
Person, including without limitation Administrative Agent and each of the
Secured Parties, being called an “Indemnitee”) against, and to hold each
Indemnitee harmless from, any and all losses, claims, actions, judgments, suits,
disbursements, penalties, damages (other than consequential damages),
liabilities and related expenses, including reasonable counsel fees and
expenses, incurred by or asserted against any Indemnitee arising out of, in any
way connected with, or as a result of:
 
(i) the execution and delivery of this Credit Agreement or any other Loan
Document or any agreement or instrument contemplated thereby,
 
(ii) the use or misuse of the proceeds of the Loans,
 
(iii) the fraudulent actions or misrepresentations of any Credit Party or its
Affiliates in connection with the transactions contemplated by this Credit
Agreement and the other Loan Documents,
 
(iv) any claim, litigation, investigation or proceeding relating to any of the
foregoing, whether or not any Indemnitee is a party thereto, or
 
(v) any claim, litigation, investigation or proceeding relating to the Investor
Documents, whether or not any Indemnitee is a party thereto;
 
provided, however, that such indemnity shall not, with respect to a particular
Indemnitee, apply to any such losses, claims, actions, judgments, suits,
disbursements, penalties, damages, liabilities or related expenses to the extent
arising from gross negligence or willful misconduct of such Indemnitee.
 
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(c) Borrower will indemnify Administrative Agent and each of the Lenders against
any costs or losses actually incurred as a result of any voluntary or
involuntary prepayments of any Loans on any date which is not a Settlement Date
under the Credit Agreement and against any increased costs or reduced return due
to changes in applicable regulations regarding withholding taxes, reserves,
capital adequacy, or other similar regulations.
 
(d) In addition to and without limiting the foregoing, the Credit Parties hereby
indemnify and hold the Indemnitees harmless from and against, and agree to
reimburse any Indemnitee on demand for, and agree to defend the Indemnitees
against, any and all Environmental Damages (as hereinafter defined), incurred by
Administrative Agent or a Lender. Without Limitation, the Foregoing Indemnity
Shall Apply to Each Indemnitee with Respect to Environmental Damages Which in
Whole or in Part Are Caused by or Arise out of the Negligence of Such (Or Any
Other) Indemnitee.  However, Such Indemnity Shall Not Apply to a Particular
Indemnitee to the Extent That the Subject of the Indemnification Is Caused by or
Arises out of the Gross Negligence or Willful Misconduct of That Particular
Indemnitee.
 
The term “Environmental Damages” means all claims, demands, liabilities
(including strict liability), losses, damages (including consequential damages),
causes of action, judgments, penalties, fines, costs and expenses (including
reasonable fees, costs and expenses of attorneys, consultants, contractors,
experts and laboratories), of any and every kind or character, contingent or
otherwise, matured or unmatured, known or unknown, direct or indirect,
foreseeable or unforeseeable, made, incurred, suffered or brought at any time
and from time to time and arising in whole or in part from:
 
(i) The presence of any Hazardous Material on any Property, or any escape,
seepage, leakage, spillage, emission, release, discharge or disposal of any
Hazardous Material on or from any Property, or the migration or release or
threatened migration or release of any Hazardous Material to, from or through
any Property; or
 
(ii) Any act, omission, event or circumstance existing or occurring in
connection with the handling, treatment, containment, removal, storage,
decontamination, clean-up, transport or disposal of any Hazardous Material by
Borrower, or any party for whose actions Borrower is liable or in connection
with any Property; or
 
(iii) The breach of any representation, warranty, covenant or agreement
contained in Section 9.16 (to the extent such breach relates to Environmental
Requirements), Section 9.18 or Section 10.8 (to the extent such breach relates
to Environmental Requirements), or Section 11.8 of this Credit Agreement; or
 
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(iv) Any violation of any Environmental Requirement, regardless of whether any
act, omission, event or circumstance giving rise to the violation constituted a
violation at the time of the occurrence or inception of such act, omission,
event or circumstance; or
 
(v) Any Environmental Liability with respect to any Property, or the filing or
imposition of any Environmental Lien against any Property, because of, resulting
from, in connection with, or arising out of any of the matters referred to in
subsections (i) through (iv) preceding.
 
(d)           The provisions of this Section 14.6 shall remain operative and in
full force and effect regardless of the termination or expiration of the
Availability Period, this Credit Agreement, or any other Loan Document, the
consummation of the transactions contemplated hereby, the repayment of the
Loans, the occurrence of the Maturity Date, the invalidity, illegality, or
unenforceability of any term or provision of this Credit Agreement or any other
Loan Document, or any investigation made by or on behalf of Lenders.  All
amounts due under this Section 14.6 shall be payable promptly on written demand
therefor.
 
14.7. Notice.  Any notice, demand, request or other communication which any
party hereto may be required or may desire to give hereunder shall be in writing
(except where telephonic instructions or notices are expressly authorized herein
to be given) and shall be deemed to be effective:  (a) if by hand delivery,
telecopy or other facsimile transmission, on the day and at the time on which
delivered to such party at the address or fax numbers specified below; (b) if by
mail, on the day which it is received after being deposited, postage prepaid, in
the United States registered or certified mail, return receipt requested,
addressed to such party at the address specified below; or (c) if by FedEx or
other reputable express mail service, on the next Business Day following the
delivery to such express mail service, addressed to such party at the address
set forth below; or (d) if by telephone, on the day and at the time reciprocal
communication (i.e., direct communication between two or more persons, which
shall not include voice mail messages) with one of the individuals named below
occurs during a call to the telephone number or numbers indicated for such party
below:
 
If to Borrower, Managing Member, Guarantor or Pledgor:
 
c/o Acadia Realty Trust
1311 Mamaroneck Avenue, Suite 260
White Plains, New York 10605
Attention:  Robert Masters, Esq.
 
If to Administrative Agent:
 
Bank of America, N.A., as Administrative Agent
NC1-027-19-01
214 North Tryon Street
Charlotte, North Carolina 28255
Attention:    Dan Hattendorf
Telephone:  (704) 388-3113
Facsimile:   (704) 388-9211

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With a copy to:
 
Bank of America, N.A., as Administrative Agent
NC1-027-19-01
214 North Tryon Street
Charlotte, NC 28255
Attention:   Brian Williams
Telephone:  (704) 683-4747
Telecopy:   (704) 968-1215
 
If to Lenders:
 
At the address and numbers set forth on Schedule 14.7.
 
Any party may change its address for purposes of this Credit Agreement by giving
notice of such change to the other parties pursuant to this Section 14.7.  With
respect to any notice received by Administrative Agent from any Credit Party or
any Investor not otherwise addressed herein, Administrative Agent shall notify
Lenders promptly of the receipt of such notice, and shall provide copies thereof
to Lenders.  When determining the prior days notice required for any Loan
Notice, Request for Letter of Credit, or other notice to be provided by a Credit
Party, any Qualified Borrower or an Investor hereunder, the day the notice is
delivered to Administrative Agent (or such other applicable Person) shall not be
counted, but the day of the related Borrowing, issuance of Letter of Credit, or
other relevant action shall be counted.
 
14.8. GOVERNING LAW.  PURSUANT TO SECTION 5-1401 OF THE NEW YORK GENERAL
OBLIGATIONS LAW,  THE SUBSTANTIVE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE, WITHOUT REGARD
TO THE CHOICE OF LAW PRINCIPLES THAT MIGHT OTHERWISE APPLY, EXCEPT TO THE EXTENT
THE LAWS OF ANOTHER JURISDICTION GOVERN THE CREATION, PERFECTION, VALIDITY, OR
ENFORCEMENT OF LIENS UNDER THE COLLATERAL DOCUMENTS, AND THE APPLICABLE FEDERAL
LAWS OF THE UNITED STATES OF AMERICA, SHALL GOVERN THE VALIDITY, CONSTRUCTION,
ENFORCEMENT AND INTERPRETATION OF THIS CREDIT AGREEMENT AND ALL OF THE OTHER
LOAN DOCUMENTS.
 
14.9. Choice of Forum; Consent to Service of Process and Jurisdiction; Waiver of
Trial by Jury.  Any suit, action or proceeding against any Credit Party with
respect to this Credit Agreement, the Notes or the other Loan Documents or any
judgment entered by any court in respect thereof, may be brought in the courts
of the State of New York, or in the United States Courts located in the Borough
of Manhattan in New York City, pursuant to Section 5-1402 of the New York
General Obligations Law, as Lenders in their sole discretion may elect and each
Credit Party hereby irrevocably submits to the non-exclusive jurisdiction of
such courts for the purpose of any such suit, action or proceeding.  Each Credit
Party hereby irrevocably consents to the service of process in any suit, action
or proceeding in said court by the mailing thereof by Administrative Agent by
registered or certified mail, postage prepaid, to the applicable address set
forth in Section 14.7.  Each Credit Party hereby irrevocably waives any
objections which it may now or hereafter have to the laying of venue of any
suit, action or proceeding arising out of or relating to this Credit Agreement
or the Notes brought in the courts located in the State of New York, Borough of
Manhattan in New York City, and hereby further irrevocably waives any claim that
any such suit, action or proceeding brought in any such court has been brought
in an inconvenient forum. EACH PARTY HERETO HEREBY EXPRESSLY WAIVES ANY RIGHT TO
TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER ANY
LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE
DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO ANY LOAN DOCUMENT,
OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR
HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND
EACH PARTY HERETO HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION
OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY
PARTY TO THIS CREDIT AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF
THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY
 
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14.10. Invalid Provisions.  If any provision of this Credit Agreement is held to
be illegal, invalid, or unenforceable under present or future laws effective
during the term of this Credit Agreement, such provision shall be fully
severable and this Credit Agreement shall be construed and enforced as if such
illegal, invalid or unenforceable provision had never comprised a part of this
Credit Agreement, and the remaining provisions of this Credit Agreement shall
remain in full force and effect and shall not be affected by the illegal,
invalid or unenforceable provision or by its severance from this Credit
Agreement, unless such continued effectiveness of this Credit Agreement, as
modified, would be contrary to the basic understandings and intentions of the
parties as expressed herein.  If any provision of this Credit Agreement shall
conflict with or be inconsistent with any provision of any of the other Loan
Documents, then the terms, conditions and provisions of this Credit Agreement
shall prevail.
 
14.11. Entirety and Amendments.  The Loan Documents embody the entire agreement
between the parties and supersede all prior agreements and understandings, if
any, relating to the subject matter hereof and thereof, and this Credit
Agreement and the other Loan Documents may be amended only by an instrument in
writing executed by the parties hereto in accordance with the terms hereof.
 
14.12. Successors and Assigns.
 
(a) The provisions of this Credit Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns
permitted hereby, except that neither the Credit Parties nor any Qualified
Borrower may assign or otherwise transfer any of their respective rights or
obligations hereunder without the prior written consent of each Lender and no
Lender may assign or otherwise transfer any of its rights or obligations
hereunder except: (i) to an Eligible Assignee in accordance with the provisions
of clause (b) of this Section 14.12; (ii) by way of participation in accordance
with the provisions of clause (f) of this Section 14.12; or (iii) by way of
pledge or assignment of a security interest subject to the restrictions of
clause (h) of this Section 14.12 (and any other attempted assignment or transfer
by any party hereto shall be null and void).  Nothing in this Credit Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby,
Participants to the extent provided in clause (f) of this Section 14.12, and, to
the extent expressly contemplated hereby, the Indemnitees) any legal or
equitable right, remedy or claim under or by reason of this Credit Agreement.
 
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(b) Any Lender may at any time assign to one or more Eligible Assignees (each,
an “Assignee”) all or a portion of its rights and obligations under this Credit
Agreement (including all or a portion of its Commitment and the Loans (including
for purposes of this clause (b), participations in Letter of Credit Liability)
at the time owing to it); provided that: (i) except in the case of an assignment
of the entire remaining amount of the assigning Lender’s Commitment and the
Loans at the time owing to it or in the case of an assignment to a Lender or an
Affiliate of a Lender or an Approved Fund with respect to a Lender, the
aggregate amount of the Commitment (which for this purpose includes Loans
outstanding thereunder) subject to each such assignment, determined as of the
date the Assignment and Assumption Agreement with respect to such assignment is
delivered to Administrative Agent or, if “Trade Date” is specified in the
Assignment and Assumption Agreement, as of the Trade Date, shall not be less
than $2,500,000, and, after such assignment, no Lender shall hold a Commitment
of less than $5,000,000; (ii) each partial assignment shall be made as an
assignment of a proportionate part of all the assigning Lender’s rights and
obligations under this Credit Agreement with respect to the Loans or the
Commitment assigned; (iii) any assignment of a Commitment must be approved by
Administrative Agent, the Letter of Credit Issuer, and, unless an Event of
Default exists and is continuing, Borrower (such approval, in each case, not to
be unreasonably withheld or delayed), unless the Person that is the proposed
assignee is itself a Program Support Provider or a Lender (whether or not the
proposed assignee would otherwise qualify as an Eligible Assignee); (iv) the
parties to each assignment shall execute and deliver to Administrative Agent an
Assignment and Assumption Agreement, together with a processing and recordation
fee as set forth on Schedule 14.12(b) (except in the case of a transfer at the
demand of Borrower under Section 14.12 hereof, in which case either Borrower or
the transferee Lender shall pay such fee); and (v) each assignment made as a
result of a demand by Borrower under Section 14.12 hereof shall be arranged by
Borrower after consultation with Administrative Agent and shall be either an
assignment of all of the rights and obligations of the assigning Lender under
this Credit Agreement or an assignment of a portion of such rights and
obligations made concurrently with another assignment or assignments that
together constitute an assignment of all of the rights and obligations of the
assigning Lender.  Subject to acceptance and recording thereof by Administrative
Agent pursuant to clause (e) of this Section 14.12, from and after the effective
date specified in each Assignment and Assumption Agreement, the Eligible
Assignee thereunder shall be a party to this Credit Agreement and, to the extent
of the interest assigned by such Assignment and Assumption Agreement, have the
rights and obligations of a Lender under this Credit Agreement, and the
assigning Lender thereunder shall, to the extent of the interest assigned by
such Assignment and Assumption Agreement, be released from its obligations under
this Credit Agreement (and, in the case of an Assignment and Assumption
Agreement covering all of the assigning Lender's rights and obligations under
this Credit Agreement, such Lender shall cease to be a party hereto but shall
continue to be entitled to the benefits of Sections 4.1, 4.4, 4.5 and 14.6 with
respect to facts and circumstances occurring prior to the effective date of such
assignment).  Upon request, each applicable Borrower Party (at its expense)
shall execute and deliver a Note to the Managing Agent of the assignee, and the
applicable existing Note or Notes shall be returned to the applicable Borrower
Party.  Any assignment or transfer by a Lender of rights or obligations under
this Credit Agreement that does not comply with this subsection shall be treated
for purposes of this Credit Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with clause (f) of
this Section 14.12.
 
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(c) Without limiting the foregoing, a Conduit Lender may, from time to time,
with prior or concurrent notice to Borrower and the Administrative Agent, in one
transaction or a series of transactions, assign all or a portion of its interest
in the Principal Obligation and its rights and obligations under this Agreement
and any other Loan Documents to which it is a party to a Conduit Assignee.  Upon
and to the extent of such assignment by the Conduit Lender to a Conduit
Assignee, (i) such Conduit Assignee shall be the owner of the assigned portion
of the Principal Obligation, (ii) the related administrator for such Conduit
Assignee will act as the Administrator for such Conduit Assignee, with all
corresponding rights and powers, express or implied, granted to the
Administrator hereunder or under the other Loan Documents, (iii) such Conduit
Assignee (and any related commercial paper issuer, if such Conduit Assignee does
not itself issue commercial paper) and their respective Program Support
Provider(s) and other related parties shall have the benefit of all the rights
and protections provided to the Conduit Lender and its Program Support
Provider(s) herein and in the other Loan Documents (including any limitation on
recourse against such Conduit Assignee or related parties, any agreement not to
file or join in the filing of a petition to commence an insolvency proceeding
against such Conduit Assignee, and the right to assign to another Conduit
Assignee as provided in this paragraph), (iv) such Conduit Assignee shall assume
all (or the assigned or assumed portion) of the Conduit Lender’s obligations, if
any, hereunder or any other Loan Document, and the Conduit Lender shall be
released from such obligations, in each case to the extent of such assignment,
and the obligations of the Conduit Lender and such Conduit Assignee shall be
several and not joint, (v) all distributions in respect of the Principal
Obligation assigned shall be made to the applicable Managing Agent, on behalf of
the Conduit Lender and such Conduit Assignee on a pro rata basis according to
their respective interests, (vi) the definition of the term “CP Rate” with
respect to the portion of the Principal Obligation funded with commercial paper
issued by the Conduit Lender from time to time shall be determined in the manner
set forth in the definition of “CP Rate” applicable to the Conduit Lender on the
basis of the interest rate or discount applicable to commercial paper issued by
such Conduit Assignee (or the related commercial paper issuer, if such Conduit
Assignee does not itself issue commercial paper) rather than the Conduit Lender,
(vii) the defined terms and other terms and provisions of this Credit Agreement
and the other Loan Documents shall be interpreted in accordance with the
foregoing, and (viii) if requested by the Managing Agent or Administrator with
respect to the Conduit Assignee, the parties will execute and deliver such
further agreements and documents and take such other actions as the Managing
Agent or such Administrator may reasonably request to evidence and give effect
to the foregoing.  No assignment by the Conduit Lender to a Conduit Assignee of
all or any portion of its interest in the Principal Obligation shall in any way
diminish the related Alternate Lenders’ obligation under Section 2.3 to fund any
Loan not funded by the Conduit Lender or such Conduit Assignee or to acquire
from the Conduit Lender or such Conduit Assignee all or any portion of its
interest in the Principal Obligation pursuant to Section 7.1.
 
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(d) In the event that a Conduit Lender makes an assignment to a Conduit Assignee
in accordance with clause (c) above, the related Alternate Lenders: (i) if
requested by the related Administrator, shall terminate their participation in
the applicable Program Support Agreement to the extent of such assignment, (ii)
if requested by the related Administrator, shall execute (either directly or
through a participation agreement, as determined by such Administrator) the
program support agreement related to such Conduit Assignee, to the extent of
such assignment, the terms of which shall be substantially similar to those of
the participation or other agreement entered into by such Alternate Lender with
respect to the applicable Program Support Agreement (or which shall be otherwise
reasonably satisfactory to the related Administrator), (iii) if requested by
such Conduit Lender, shall enter into such agreements as requested by the
Conduit Lender pursuant to which they shall be obligated to provide funding to
such Conduit Assignee on the same terms and conditions as is provided for in
this Agreement in respect of such Conduit Lender (or which agreements shall be
otherwise reasonably satisfactory to Borrower and such Conduit Lender), and (iv)
shall take such actions as the Administrator shall reasonably request in
connection therewith.
 
(e) Administrative Agent, acting solely for this purpose as an agent of the
Credit Parties, shall maintain at Administrative Agent’s Office a copy of each
Assignment and Assumption Agreement delivered to and accepted by it and a
register for the recordation of the names and addresses of the Lenders, and the
Commitments of, and principal amounts of the Loans and Letter of Credit
Liability owing to, each Lender pursuant to the terms hereof from time to time
(the “Register”).  The entries in the Register shall be conclusive, and each
Credit Party, Administrative Agent, Agents and the Lenders may treat each Person
whose name is recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Credit Agreement.  The Register shall be
available for inspection and copying by the Credit Parties, any Agent and any
Lender, at any reasonable time and from time to time upon reasonable prior
notice. Upon the consummation of any assignment in accordance with this
Section 14.12, Schedule 14.12(b) shall automatically be deemed amended (to the
extent required) by Administrative Agent to reflect the name and address of the
applicable Assignee.
 
(f) Any Lender may at any time, without the consent of, or notice to, any Credit
Party or Administrative Agent, sell participations to any Person (other than a
natural person or any Credit Party or any Affiliate thereof) (each, a
“Participant”) in all or a portion of such Lender’s rights and/or obligations
under this Credit Agreement (including all or a portion of its Commitment and/or
the Loans (including such Lender’s participations in Letter of Credit Liability)
owing to it); provided that: (i) such Lender’s obligations under this Credit
Agreement shall remain unchanged; (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations;
and (iii) each Credit Party, Administrative Agent and the other Lenders shall
continue to deal solely and directly with such Lender in connection with such
Lender’s rights and obligations under this Credit Agreement.  Any agreement or
instrument pursuant to which a Lender sells such a participation shall provide
that such Lender shall retain the sole right to enforce this Credit Agreement
and to approve any amendment, modification or waiver of any provision of this
Credit Agreement; provided that such agreement or instrument may provide that
such Lender will not, without the consent of the Participant, agree to any
amendment, waiver or other modification described in Section 14.1(a),
14.1(b)(ii) or 14.1(b)(v) that directly affects such Participant.  Subject to
clause (g) of this Section 14.12, each Borrower Party agrees that each
Participant shall be entitled to the benefits of Sections 4.1, 4.4 and 4.5 to
the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to clause (b) of this Section 14.12.  To the extent
permitted by law, each Participant also shall be entitled to the benefits of the
right of setoff under application law as though it were a Lender, provided such
Participant agrees to be subject to Sections 14.2 and 14.3 as though it were a
Lender.
 
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(g) A Participant shall not be entitled to receive any greater payment under
Sections 4.1 or 4.4 than the applicable Lender would have been entitled to
receive with respect to the participation sold to such Participant, unless the
sale of the participation to such Participant is made with Borrower’s prior
written consent.
 
(h) Any Lender may at any time pledge or assign a security interest in all or
any portion of its rights under this Credit Agreement (including under its Note,
if any) to secure obligations of such Lender, including any pledge or assignment
to secure obligations to a Federal Reserve Bank; provided that no such pledge or
assignment shall release such Lender from any of its obligations hereunder or
substitute any such pledgee or assignee for such Lender as a party hereto.
 
(i) Notwithstanding anything to the contrary contained herein, if at any time
Bank of America assigns all of its Commitment and Loans pursuant to clause (b)
above, Bank of America may, upon thirty (30) days’ notice to the Borrower
Parties and the Lenders, resign as Administrative Agent and Letter of Credit
Issuer.  In the event of any such resignation, Lenders shall appoint from among
the Lenders a successor Administrative Agent and Letter of Credit Issuer
hereunder (subject, except when an Event of Default exists, to the consent of
Borrower, not to be unreasonably withheld); provided, however, that no failure
by Lenders to appoint any such successor shall affect the resignation of Bank of
America as Letter of Credit Issuer and Administrative Agent.  If Bank of America
resigns as Letter of Credit Issuer and Administrative Agent, it shall retain all
the rights and obligations of the Letter of Credit Issuer hereunder with respect
to all Letters of Credit outstanding as of the effective date of its resignation
as Letter of Credit Issuer and all Letter of Credit Liability with respect
thereto (including the right to require the Lenders to fund payment of any
amount drawn under a Letter of Credit issued by Bank of America as Letter of
Credit Issuer hereunder.
 
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14.13. Lender Default.  If for any reason any Lender shall fail or refuse to
abide by its obligations hereunder, and such Lender shall not have cured such
failure or refusal within five (5) Business Days of its occurrence (a “Lender
Default”), then, in addition to the rights and remedies that may be available to
Administrative Agent, Lenders, or any Borrower Party at law or in equity, such
Lender’s right to vote on matters related to this Credit Agreement, and to
participate in the administration of the Loans, the Letters of Credit, and this
Credit Agreement, shall be suspended.  Administrative Agent shall have the
right, but not the obligation, in its sole discretion, to acquire at par all of
such Lender’s Commitment, including its Pro Rata Share in the Obligations under
this Credit Agreement.  In the event that Administrative Agent does not exercise
its right to so acquire all of such Lender’s interests, then each Lender that is
not a Defaulting Alternate Lender (each, a “Current Party”) shall then,
thereupon, have the right, but not the obligation, in its sole discretion to
acquire at par (or if more than one Current Party exercises such right, each
Current Party shall have the right to acquire, pro rata) such Lender’s
Commitment, including its Pro Rata Share in the outstanding Obligations under
this Credit Agreement.
 
14.14. Replacement of Lender.  Following a demand by an Alternate Lender for
payment of any amounts under Section 4.1 or 4.3, or if any Alternate Lender is a
Defaulting Alternate Lender (in either case, an “Affected Lender”), Borrower may
elect to replace such Affected Lender as an Alternate Lender party to this
Credit Agreement with an Eligible Assignee procured by Borrower, provided that
no Potential Default nor Event of Default shall have occurred and be continuing
at the time of such replacement, and provided further that, concurrently with
such replacement such Eligible Assignee shall agree to purchase for cash the
Loans and other Obligations due to the Affected Lender pursuant to an Assignment
and Assumption Agreement and to become an Alternate Lender for all purposes
under this Credit Agreement and to assume all obligations of the Affected Lender
to be terminated as of such date.  Any such Affected Lender shall assign its
rights and interests hereunder, such assignment to be effected in compliance
with the requirements of Section 14.12(b) hereof.  In the event that such an
assignment occurs, the Eligible Assignee (i) if requested by the applicable
Administrator, shall execute (either directly or through a participation
agreement, as determined by the Administrator) a Program Support Agreement
related to the applicable Conduit Lender, to the extent of such assignment, the
terms of which shall be substantially similar to those of the participation or
other agreement by the assigning Alternate Lender with respect to the applicable
Program Support Agreement (or which shall be otherwise reasonably satisfactory
to the applicable Administrator), and (ii) shall take such actions as the Agents
shall reasonably request in connection therewith.
 
14.15. Maximum Interest.  Regardless of any provision contained in any of the
Loan Documents, Lenders shall never be entitled to receive, collect or apply as
interest on the Obligations any amount in excess of the Maximum Rate, and, in
the event that Lenders ever receive, collect or apply as interest any such
excess, the amount which would be excessive interest shall be deemed to be a
partial prepayment of principal and treated hereunder as such; and, if the
principal amount of the Obligations is paid in full, any remaining excess shall
forthwith be paid to the applicable Borrower Party.  In determining whether or
not the interest paid or payable under any specific contingency exceeds the
Maximum Rate, each Borrower Party and Lenders shall, to the maximum extent
permitted under applicable law: (a) characterize any nonprincipal payment as an
expense, fee or premium rather than as interest; (b) exclude voluntary
prepayments and the effects thereof; and (c) amortize, prorate, allocate and
spread, in equal parts, the total amount of interest throughout the entire
contemplated term of the Obligations so that the interest rate does not exceed
the Maximum Rate; provided that, if the Obligations are paid and performed in
full prior to the end of the full contemplated term thereof, and if the interest
received for the actual period of existence thereof exceeds the Maximum Rate,
Lenders shall refund to the applicable Borrower Party the amount of such excess
or credit the amount of such excess against the principal amount of the
Obligations and, in such event, Lenders shall not be subject to any penalties
provided by any laws for contracting for, charging, taking, reserving or
receiving interest in excess of the Maximum Rate.  As used herein, the term
“applicable law” shall mean the law in effect as of the date hereof; provided,
however, that in the event there is a change in the law which results in a
higher permissible rate of interest, then the Loan Documents shall be governed
by such new law as of its effective date.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
103

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14.16. Headings.  Section headings are for convenience of reference only and
shall in no way affect the interpretation of this Credit Agreement.
 
14.17. Survival.  All representations and warranties made by the Credit Parties
and the Qualified Borrowers herein shall survive delivery of the Notes, the
making of the Loans and the issuance of the Letters of Credit.
 
14.18. Integration.  This Credit Agreement is intended by the parties as the
final, complete and exclusive statement of the transactions evidenced by this
Credit Agreement. All prior or contemporaneous promises, agreements and
understandings, whether oral or written, are deemed to be superseded by this
Credit Agreement, and no party is relying on any promise, agreement or
understanding not set forth in this Credit Agreement.
 
14.19. Limited Liability of Investors.  Except with respect to any expenses and
losses arising from any Credit Party’s intentional misrepresentation hereunder,
fraud or willful misapplication of proceeds in contravention of this Credit
Agreement, for which there shall be full recourse to such Credit Party, none of
the Investors, including the Managing Member, shall have any personal,
partnership, corporate or trust liability for the payment or performance of the
Obligations.  Nothing contained in this Section 14.19 or in any of the other
provisions of the Loan Documents shall be construed to limit, restrict, or
impede the obligations, the liabilities, and indebtedness of Borrower, or of any
Investor to make its Capital Contributions to Borrower, Managing Member,
Guarantor or Pledgor, in accordance with the terms of the Operating Agreement,
Partnership Agreement or the Stockholders Agreement, as applicable, or pursuant
to the terms of such Investor’s Investor Letter.  Nothing contained in this
Section 14.19 shall be deemed to expressly or implicitly limit or modify the
liability of each Qualified Borrower to Lenders under the Qualified Borrower
Notes; provided, however, that such liability shall not extend beyond such
Qualified Borrower and its properties and assets.  Notwithstanding anything
contained in this Section 14.19, the payment and performance of the Obligations
shall be fully recourse to each Borrower Party and the payment and performance
of the Guaranteed Obligations shall be fully recourse to the Guarantor and, in
each case, their properties and assets.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
104

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14.20. Confidentiality.  Administrative Agent, each Managing Agent, each
Administrator and each Lender agrees to maintain the confidentiality of the
Information (as defined below), except that Information may be disclosed: (a) to
its and its Affiliates’ respective partners, directors, officers, employees,
representatives, advisors and agents, including accountants, legal counsel and
other advisors (it being understood that the Persons to whom such disclosure is
made will be informed of the confidential nature of such Information and
instructed to keep such Information confidential and to use such Information
only in connection with this facility); (b) to the extent requested by any
regulatory authority; (c) to the extent  required by applicable laws or
regulations or by any subpoena or similar legal process; (d) to any other party
to this Credit Agreement; (e) in connection with the exercise of any remedies
hereunder or any suit, action or proceeding relating to this Credit Agreement or
the enforcement of rights hereunder; (f) subject to an agreement containing
provisions substantially the same as those of this Section 13.21, to: (i) any
Eligible Assignee of or Participant in, or any prospective Eligible Assignee of
or Participant in, any of its rights or obligations under this Credit Agreement;
or (ii) any direct or indirect contractual counterparty or prospective
counterparty (or such contractual counterparty’s or prospective counterparty’s
professional advisor) to any credit derivative transaction relating to
obligations of the Borrower Parties; (g) with the consent of the applicable
Borrower; (h) to the extent such Information: (x) becomes publicly available
other than as a result of a breach of this Section 14.20 or (y) becomes
available to Administrative Agent, any Managing Agent, any Administrator or any
Lender on a nonconfidential basis from a source other than a Credit Party; or
(i) to the National Association of Insurance Commissioners or any other similar
organization or any rating agency, Commercial Paper dealer, provider of credit
enhancement or liquidity to such Conduit Lender or any Person providing
financing to, or holding equity interest in, such Conduit Lender, any Program
Support Provider, any Conduit Collateral Agent and to any officers, directors,
employees, outside accountants and attorneys of any of the foregoing, provided
that such recipient has been advised of the confidential nature of such
information and agrees to be bound by the provisions of this Section 14.20.  For
the purposes of this Section 14.20, “Information” means all information received
from any Credit Party, other than any such information that is available to
Administrative Agent, any Managing Agent, any Administrator or any Lender on a
nonconfidential basis prior to disclosure by such Person; provided that, in the
case of information received from any Credit Party after the date hereof, such
information is clearly identified in writing at the time of delivery as
confidential.  Any Person required to maintain the confidentiality of
Information as provided in this Section 14.20 shall be considered to have
complied with its obligation to do so if such Person has exercised the same
degree of care to maintain the confidentiality of such Information as such
Person would accord to its own confidential information.  Administrative Agent,
Arranger, each Lender and Agent agrees not to disclose the identity of the
Investors in connection with any public disclosure of the transaction
contemplated hereby, such as in tombstones or marketing materials.
 
14.21. USA PATRIOT Act Notice.  Each Lender and each Agent (for itself and not
on behalf of any Lender) hereby notifies the Credit Parties that pursuant to the
requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into
law October 26, 2001)) (the “Act”), it is required to obtain, verify and record
information that identifies the Credit Parties, which information includes the
name and address of the Credit Parties and other information that will allow
such Lender or Agent, as applicable, to identify the Credit Parties in
accordance with the Patriot Act.
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
105

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14.22. Multiple Counterparts.  This Credit Agreement may be executed in any
number of counterparts, all of which taken together shall constitute one and the
same agreement, and any of the parties hereto may execute this Credit Agreement
by signing any such counterpart.
 
14.23. No Bankruptcy Petition Against any Conduit Lender.  Each Credit Party
hereby covenants and agrees that, prior to the date which is one year and one
day after the payment in full of all outstanding Commercial Paper or other rated
indebtedness of a Conduit Lender, it will not institute against, or encourage,
cooperate with or join any other Person in instituting against, such Conduit
Lender any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings under the law of the United States or any state of the United
States.  The provisions of this Section 14.23 shall survive the termination of
this Credit Agreement.
 
14.24. No Recourse Against any Conduit Lender.  Notwithstanding anything to the
contrary contained in this Credit Agreement, the obligations of each Conduit
Lender under this Credit Agreement and all other Loan Documents are solely the
corporate obligations of such Conduit Lender and shall be payable solely to the
extent of funds received by such Conduit Lender from the Credit Parties in
accordance herewith or from any party to any Loan Document in accordance with
the terms thereof in excess of funds necessary to pay such Conduit Lender’s
matured and maturing Commercial Paper or other rated indebtedness and, to the
extent funds are not available to pay such obligations, the claims relating
thereto shall not constitute a claim against such Conduit Lender but shall
continue to accrue.  The payment of any claim (as defined in Section 101 of
Title 11 of the Bankruptcy Code) of any party to this Credit Agreement or any
other Loan Document against a Conduit Lender shall be subordinated to the
payment in full of all of such Conduit Lender’s Commercial Paper and other rated
indebtedness.  No recourse under or with respect to any obligation, covenant or
agreement of any Conduit Lender as contained in this Credit Agreement or any
other agreement, instrument or document entered into by it pursuant hereto or in
connection herewith shall be had against any manager or administrator of such
Person or any incorporator, stockholder, member, officer, employee or director
of such Person or of any such manager or administrator, as such, by the
enforcement of any assessment or by any legal or equitable proceeding, by virtue
of any statute or otherwise.
 
Remainder of Page Intentionally Left Blank
Signature Pages Follow.
 
 
 
 
 
 
 
Revolving Credit Agreement
Acadia Strategic Opportunity Fund III LLC
 
106

--------------------------------------------------------------------------------

 
 
IN WITNESS WHEREOF, the parties hereto have caused this Credit Agreement to be
duly executed as of the day and year first above written.
 

 
BORROWER:
       
ACADIA STRATEGIC OPPORTUNITY FUND III LLC,
 
a Delaware limited liability company
       
By:
/s/ Robert Masters
   
Name: Robert Masters
   
Title: Senior Vice President
             
MANAGING MEMBER:
       
ACADIA REALTY ACQUISITION III LLC,
 
a Delaware limited liability company
       
By:
/s/ Robert Masters
   
Name: Robert Masters
   
Title: Senior Vice President
             
PLEDGOR:
       
ACADIA INVESTORS III, INC.,
 
a Maryland corporation
       
By:
/s/ Robert Masters
   
Name: Robert Masters
   
Title: Senior Vice President
             
GUARANTOR:
       
 ACADIA REALTY LIMITED PARTNERSHIP,
 
 a Delaware limited partnership
       
  By:
ACADIA REALTY TRUST,
   
its General Partner
         
By: /s/ Robert Masters
   
       Name: Robert Masters
 
 
       Title: Senior Vice President

Signature Page to Revolving Credit Agreement
 
 

--------------------------------------------------------------------------------

 
 

  ADMINISTRATIVE AGENT:      
BANK OF AMERICA, N.A., as
 
Administrative Agent
         
By: /s/ Jeremy Grubb
 
Name: Jeremy Grubb
 
Title: Vice President

Signature Page to Revolving Credit Agreement
 
 

--------------------------------------------------------------------------------

 

 

 
MANAGING AGENT AND ADMINISTRATOR:
     
BANK OF AMERICA, N.A., as Managing Agent
for the YC SUSI Lender Group and as
Administrator for YC SUSI Trust
     
By: /s/ Jeremy Grubb
 
Name: Jeremy Grubb
 
Title: Vice President

Signature Page to Revolving Credit Agreement
 
 

--------------------------------------------------------------------------------

 

 

 
LENDERS:
     
BANK OF AMERICA, N.A.,
 
as an Alternate Lender for the YC SUSI Lender Group
     
By: /s/ Jeremy Grubb
 
Name: Jeremy Grubb
 
Title: Vice President

 
Signature Page to Revolving Credit Agreement
 
 

--------------------------------------------------------------------------------

 
 

 
YC SUSI TRUST, as Conduit Lender
     
By: /s/ Jeremy Grubb
 
Name: Jeremy Grubb
 
Title: Vice President

Signature Page to Revolving Credit Agreement
 
 

--------------------------------------------------------------------------------

 
 
Schedule 1.1
 
Commitments
 

Alternate Lender
Commitment
Bank of America, N.A.
$75,000,000

 
 
 
 
 
 
 
Schedule to Revolving Credit Agreement
 
 

--------------------------------------------------------------------------------

 
 
Schedule 14.7
 
Addresses
 
 
 
Bank of America
 
Bank of America, N.A., as Administrative Agent
NC1-027-19-01
214 North Tryon Street
Charlotte, North Carolina 28255
Attention:    Dan Hattendorf
Telephone:  (704) 388-3113
Facsimile:   (704) 388-9211
 
With copy to:
 
Bank of America, N.A., as Administrative Agent
NC1-027-19-01
214 North Tryon Street
Charlotte, NC 28255
Attention:                      Brian Williams
Telephone:                    (704) 683-4747
Telecopy:                      (704) 968-1215
 
YC SUSI Trust
 
YC SUSI Trust
c/o Bank of America, N.A.
NC1-027-19-01
214 North Tryon Street
Charlotte, North Carolina 28255
Attention:    Dan Hattendorf
Telephone:  (704) 388-3113
Facsimile:   (704) 388-9211
 
With copy to:
 
YC SUSI Trust
c/o Bank of America, N.A.
NC1-027-19-01
214 North Tryon Street
Charlotte, NC 28255
Attention:                      Brian Williams
Telephone:                     (704) 683-4747
Telecopy:                       (704) 968-1215
 
Schedule to Revolving Credit Agreement
 
 

--------------------------------------------------------------------------------

 
 
Schedule 14.12(b)
 
Processing and Recordation Fees
 
The Administrative Agent will charge the applicable Lenders a processing and
recordation fee (an “Assignment Fee”) in the amount of $2,500 for each
assignment; provided, however, that in the event of two or more concurrent
assignments to members of the same Assignee Group (which may be effected by a
suballocation of an assigned amount among members of such Assignee Group) or two
or more concurrent assignments by members of the same Assignee Group to a single
Eligible Assignee (or to an Eligible Assignee and members of its Assignee
Group), the Assignment Fee will be $2,500 plus the amount set forth below:
 

Transaction
Assignment Fee
   
First four concurrent assignments or suballocations to members of an Assignee
Group (or from members of an Assignee Group, as applicable)
-0-
Each additional concurrent assignment or suballocation to a member of such
Assignee Group (or from a member of such Assignee Group, as applicable)
$500

 
 
 
 
 
 
 
 

 
Schedule to Revolving Credit Agreement
 
 

--------------------------------------------------------------------------------

 
 
EXHIBIT A
to Revolving Credit Agreement
by and among
Acadia Strategic Opportunity Fund III LLC, as Borrower,
Acadia Realty Acquisition III LLC, as Managing Member,
Acadia Realty Limited Partnership, as Guarantor,
Acadia Investors III, Inc., as Pledgor,
Bank of America, N.A., as Administrative Agent,
Banc of America Securities LLC, as Sole Lead Arranger and Sole Book Manager,
YC SUSI Trust, as Conduit Lender,
Bank of America, N.A., as an Administrator, Alternate Lender and Managing Agent,
and
the other Conduit Lenders, Administrators, Alternate Lenders and Managing Agents
from
time to time party thereto
SCHEDULE OF INVESTORS AND COMMITMENTS
(as of October 10, 2007)
 
[See Attached Spreadsheet]
 
Exhibit A
 
 
 

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GRAPHIC [exhibit1069_2.jpg]
 
 

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GRAPHIC [exhibit1069_3.jpg]

 

 

 
 
 

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EXHIBIT B-1
to Revolving Credit Agreement
by and among
Acadia Strategic Opportunity Fund III LLC, as Borrower,
Acadia Realty Acquisition III LLC, as Managing Member,
Acadia Realty Limited Partnership, as Guarantor,
Acadia Investors III, Inc., as Pledgor,
Bank of America, N.A., as Administrative Agent,
Banc of America Securities LLC, as Sole Lead Arranger and Sole Book Manager,
YC SUSI Trust, as Conduit Lender,
Bank of America, N.A., as an Administrator, Alternate Lender and Managing Agent,
and
the other Conduit Lenders, Administrators, Alternate Lenders and Managing Agents
from
time to time party thereto
 
NOTE
 
 

$300,000,000   New York, New York     , 2007

 
                                                 
1.           FOR VALUE RECEIVED, ACADIA STRATEGIC OPPORTUNITY FUND III LLC, a
Delaware limited liability company ("Maker"), hereby unconditionally promises to
pay to the order of BANK OF AMERICA, N.A. ("Payee"), as Managing Agent for each
of the Lenders in the YC SUSI Lender Group under the Credit Agreement referred
to below, the principal sum of THREE HUNDRED MILLION DOLLARS ($300,000,000), or,
if less, the unpaid principal amount of the Loans of Payee, together with
interest thereon, in lawful money of the United States. Capitalized terms not
defined herein shall have the meanings assigned to such terms in the Credit
Agreement referred to below.
 
2.            The unpaid principal amount of this Note (this "Note") shall be
payable in accordance with the terms of Sections 3.2, 3.4 and 14.15 of the
Credit Agreement.
 
3.            The unpaid principal amount of this Note shall bear interest from
the date of each Borrowing until maturity in accordance with Sections 2.4 and
14.15 of the Credit Agreement. Interest on this Note shall be payable in
accordance with Sections 3.3, 3.4 and 14.15 of the Credit Agreement.
 
4.            All Borrowings of Loans hereunder, and all payments made with
respect thereto, may be recorded by Payee from time to time on the grid which
may be attached hereto or Payee may record such information by such other method
as Payee may generally employ in the course of its lending activities; provided,
however, that failure to make any such entry shall in no way reduce or diminish
Maker's obligations hereunder. The aggregate unpaid amount of all Borrowings of
Loans set forth on the grid which may be attached hereto shall be rebuttably
presumptive evidence of the unpaid principal amount of this Note.
 
5.           This Note has been executed and delivered pursuant to that certain
Revolving Credit Agreement (as amended, modified, supplemented, or restated from
time to time, the ("Credit Agreement"), dated as of October 10, 2007, by and
among Maker, Acadia Realty Acquisition III LLC, a Delaware limited liability
company, as Managing Member, Acadia Realty Limited Partnership, a Delaware
limited partnership, as Guarantor, Acadia Investors III, Inc., a Maryland
corporation, as Pledgor, Bank of America, N.A., as Administrative Agent, Banc of
America Securities LLC, as Sole Lead Arranger and Sole Book Manager, YC SUSI
Trust, as Conduit Lender, Bank of America, N.A., as an Administrator, Alternate
Lender and Managing Agent and the other Conduit Lenders, Administrators,
Alternate Lenders and Managing Agents from time to time party thereto, and is
one of the "Notes" referred to therein. This Note evidences Loans made under the
Credit Agreement and the holder of this Note shall be entitled to the benefits
provided in the Credit Agreement. Reference is hereby made to the Credit
Agreement for a statement of: (a) the obligation of Payee to make advances
hereunder; (b) the prepayment rights and obligations of Maker; (c) the
collateral for the repayment of this Note; and (d) the events upon which the
maturity of this Note may be accelerated. Maker may borrow, repay and reborrow
hereunder upon the terms and conditions specified in the Credit Agreement.
 
 
Note

--------------------------------------------------------------------------------

 
 
6.            If this Note, or any installment or payment due hereunder, is not
paid when due, whether at maturity or by acceleration, or if it is collected
through a bankruptcy, probate or other court, whether before or after maturity,
Maker agrees to pay all out-of-pocket costs of collection, including, but not
limited to, reasonable attorneys' fees incurred by the holder hereof and costs
of appeal as provided for in the Credit Agreement. All past-due principal of,
and, to the extent permitted by applicable law, past-due interest on this Note,
shall bear interest until paid at the Default Rate as provided for in the Credit
Agreement.
 
7.            Maker and all sureties, endorsers, guarantors and other parties
ever liable for payment of any sums payable pursuant to the terms of this Note,
jointly and severally waive demand, presentment for payment, protest, notice of
protest, notice of acceleration and notice of intent to accelerate, diligence in
collection, the bringing of any suit against any party, and any notice of or
defense on account of any extensions, renewals, partial payment, or any releases
or substitutions of any security, or any delay, indulgence, or other act of any
trustee or any holder hereof, whether before or after maturity.
 
8.            Pursuant to Section 5-1401 of the New York General Obligations
Law, the substantive laws of the State of New York, without regard to the choice
of law principles that might otherwise apply, and the applicable federal laws of
the United States of America, shall govern the validity, construction,
enforcement and interpretation of this Note.
 
9.            Reference is hereby made to Section 14.19 of the Credit Agreement
regarding the non-personal liability of Managing Member or any other Investor,
the provisions of which are hereby incorporated by reference in this Note as if
fully set forth herein, for the payment and performance of Borrower's
obligations hereunder.
 
REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.
SIGNATURE PAGE FOLLOWS.
 
 
Note

--------------------------------------------------------------------------------

 
 

 
BORROWER:
     
ACADIA STRATEGIC OPPORTUNITY FUND III LLC,
 
a Delaware limited liability company
         
By: /s/ Robert Masters
 
Name: Robert Masters
 
Title: Senior Vice President

 
 
Exhibit B-1

--------------------------------------------------------------------------------

 
 
Date
Borrowing Amount
Payment
Aggregate
Unpaid Amount
                                                                               
                                                               

 
 

2 

Exhibit B-1
 

--------------------------------------------------------------------------------

 
 
EXHIBIT B-2
to Revolving Credit Agreement
by and among
Acadia Strategic Opportunity Fund III LLC, as Borrower,
Acadia Realty Acquisition III LLC, as Managing Member,
Acadia Realty Limited Partnership, as Guarantor,
Acadia Investors III, Inc., as Pledgor,
Bank of America, N.A., as Administrative Agent,
Banc of America Securities LLC, as Sole Lead Arranger and Sole Book Manager,
YC SUSI Trust, as Conduit Lender,
Bank of America, N.A., as an Administrator, Alternate Lender and Managing Agent,
and
the other Conduit Lenders, Administrators, Alternate Lenders and Managing Agents
from
time to time party thereto
 
FORM OF QUALIFIED BORROWER NOTE
 
 

$      New York, New York   ,  

 
1.            FOR VALUE RECEIVED, the undersigned _____________________a (the
"Maker"), hereby unconditionally promises to pay to the order of BANK OF
AMERICA, N.A. ("Payee"), as Managing Agent for each of the Lenders in the Ranger
Lender Group under the Credit Agreement referred to below, the principal sum
of _______________($_____ ), or, if less, the unpaid principal amount of the
Loans of Payee, together with interest thereon, in lawful money of the United
States. Capitalized terms not defined herein shall have the meanings assigned to
such terms in the Credit Agreement referred to below.
 
2.            The unpaid principal amount of this Note (this "Note") shall be
payable in accordance with the terms of Sections 3.2, 3.4 and 14.15 of the
Credit Agreement.
 
3.            The unpaid principal amount of this Note shall bear interest from
the date of each Borrowing until maturity in accordance with Sections 2.4 and
14.15 of the Credit Agreement. Interest on this Note shall be payable in
accordance with Sections 3.3, 3.4 and 14.15 of the Credit Agreement.
 
4.            All Borrowings of Loans hereunder, and all payments made with
respect thereto, may be recorded by Payee from time to time on the grid which
may be attached hereto or Payee may record such information by such other method
as Payee may generally employ in the course of its lending activities; provided,
however, that failure to make any such entry shall in no way reduce or diminish
Maker's obligations hereunder. The aggregate unpaid amount of all Borrowings of
Loans set forth on the grid which may be attached hereto shall be rebuttably
presumptive evidence of the unpaid principal amount of this Note.
 
5.            This Note has been executed and delivered pursuant to that certain
Revolving Credit Agreement (as amended, modified, supplemented, or restated from
time to time, the "Credit Agreement") dated as of October 10, 2007, by and among
Acadia Strategic Opportunity Fund III LLC, a Delaware limited liability company
("Borrower"), Acadia Realty Acquisition III LLC, a Delaware limited liability
company, as Managing Member, Acadia Realty Limited Partnership, a Delaware
limited partnership, as Guarantor, Acadia Investors III, Inc., a Maryland
corporation, as Pledgor, Bank of America, N.A., as Administrative Agent, Banc of
America Securities LLC, as Sole Lead Arranger and Sole Book Manager, YC SUSI
Trust, as Conduit Lender, Bank of America, N.A., as an Administrator, Alternate
Lender and Managing Agent and the other Conduit Lenders, Administrators,
Alternate Lenders and Managing Agents from time to time party thereto, and is
one of the "Qualified Borrower Notes" referred to therein. This Note evidences
Loans made under the Credit Agreement and the holder of this Note shall be
entitled to the benefits provided in the Credit Agreement. Reference is hereby
made to the Credit Agreement for a statement of: (a) the obligation of Payee to
make advances hereunder; (b) the prepayment rights and obligations of Maker; (c)
the collateral for the repayment of the Note; and (d) the events upon which the
maturity of this Note may be accelerated. Maker may borrow, repay and reborrow
hereunder upon the terms and conditions specified in the Credit Agreement. The
repayment of this Note is secured by a guaranty of Borrower. Notwithstanding the
foregoing, should any of the events described in Sections 12.1(g) or 12.1(2) of
the Credit Agreement occur with respect to Maker, then the principal of or
accrued interest on this Note shall become immediately due and payable without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by Maker.
 
 
Exhibit B-2

--------------------------------------------------------------------------------

 
 
6.            If this Note, or any installment or payment due hereunder, is not
paid when due, whether at maturity or by acceleration, or if it is collected
through a bankruptcy, probate or other court, whether before or after maturity,
Maker agrees to pay all out-of-pocket costs of collection, including, but not
limited to, reasonable attorneys' fees incurred by the holder hereof and costs
of appeal as provided for in the Credit Agreement. All past-due principal of,
and, to the extent permitted by applicable law, past-due interest on this Note,
shall bear interest until paid at the Default Rate as provided for in the Credit
Agreement.
 
7.            Maker and all sureties, endorsers, guarantors and other parties
ever liable for payment of any sums payable pursuant to the terms of this Note,
jointly and severally waive demand, presentment for payment, protest, notice of
protest, notice of acceleration, notice of intent to accelerate, diligence in
collection, the bringing of any suit against any party, and any notice of or
defense on account of any extensions, renewals, partial payment, or any releases
or substitutions of any security, or any delay, indulgence, or other act of any
trustee or any holder hereof, whether before or after maturity.
 
8.            Pursuant to Section 5-1401 of the New York General Obligations
Law, the substantive laws of the State of New York, without regard to the choice
of law principles that might otherwise apply, and the applicable federal laws of
the United States of America, shall govern the validity, construction,
enforcement and interpretation of this Note.
 
9.                      By its execution hereof, Maker hereby agrees to be bound
by the terms and conditions of the Credit Agreement as if it were a signature
party thereto.
 
10.                      Reference is hereby made to Section 14.19 of the Credit
Agreement regarding the non-personal liability of Managing Member or any other
Investor, the provisions of which are hereby incorporated by reference in this
Note as if fully set forth herein, for the payment and performance of Maker's
obligations hereunder.
 
REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.
SIGNATURE PAGE FOLLOWS.
 
2
 
Exhibit B-2

--------------------------------------------------------------------------------

 
 

 
BORROWER:
     
[QUALIFIED BORROWER]
         
By:
 
Name:
 
Title:

 
3
 
Exhibit B-2

--------------------------------------------------------------------------------

 
 
Date
Borrowing Amount
Payment
Aggregate
Unpaid Amount
                                                                               
                                                       

 
 
Exhibit B-2

--------------------------------------------------------------------------------

 
 
EXHIBIT B-3
to Revolving Credit Agreement
by and among
Acadia Strategic Opportunity Fund III LLC, as Borrower,
Acadia Realty Acquisition III LLC, as Managing Member,
Acadia Realty Limited Partnership, as Guarantor,
Acadia Investors III, Inc., as Pledgor,
Bank of America, N.A., as Administrative Agent,
Banc of America Securities LLC, as Sole Lead Arranger and Sole Book Manager,
YC SUSI Trust, as Conduit Lender,
Bank of America, N.A., as an Administrator, Alternate Lender and Managing Agent,
and
the other Conduit Lenders, Administrators, Alternate Lenders and Managing Agents
from
time to time party thereto
 
FORM OF QUALIFIED BORROWER LETTER OF CREDIT NOTE
 
 

  New York, New York   ,   

 
 
1.           FOR VALUE RECEIVED, _____________, a_________________ ("Maker"),
hereby unconditionally promises to pay to the order of BANK OF AMERICA, N.A.
("Payee"), as Managing Agent for each of the Lenders in the [_______]Lender
Group under the Credit Agreement referred to below, the principal sum
of_______________ ($_____), together with interest thereon, or, if less, so much
thereof as may be drawn under the Letter of Credit (as hereinafter defined),
together with interest on the unpaid principal amount from day to day remaining
from the date of advance until maturity as set forth below, in lawful money of
the United States. Capitalized terms not defined herein shall have the meanings
assigned to such terms in the Credit Agreement referred to below.
 
2.            The unpaid principal amount of this Note (this "Note") shall be
payable in accordance with the terms of Sections 3.2, 3.4 and 14.15 of the
Credit Agreement.
 
3.            The unpaid principal amount of this Note shall bear interest from
the date of each Borrowing until maturity in accordance with Sections 2.4 and
14.15 of the Credit Agreement. Interest on this Note shall be payable in
accordance with Sections 3.3, 3.4 and 14.15 of the Credit Agreement.
 
4.            All Borrowings of Loans hereunder, and all payments made with
respect thereto, may be recorded by Payee from time to time on the grid which
may be attached hereto or Payee may record such information by such other method
as Payee may generally employ in the course of its lending activities; provided,
however, that failure to make any such entry shall in no way reduce or diminish
Maker's obligations hereunder. The aggregate unpaid amount of all Borrowings of
Loans set forth on the grid which may be attached hereto shall be rebuttably
presumptive evidence of the unpaid principal amount of this Note.
 
 
Exhibit B-3

--------------------------------------------------------------------------------

 
 
5.            This Note has been executed and delivered to evidence advances
made to Maker pursuant to that certain Revolving Credit Agreement (as amended,
modified, supplemented, or restated from time to time, the ("Credit Agreement")
dated as of October 10, 2007, by and. among Acadia Strategic Opportunity Fund
III LLC, a Delaware limited liability company ("Borrower"), Acadia Realty
Acquisition III LLC, a Delaware limited liability company, as Managing Member,
Acadia Realty Limited Partnership, a Delaware limited partnership, as Guarantor,
Acadia Investors III, Inc., a Maryland corporation, as Pledgor, Bank of America,
N.A., as Administrative Agent, Banc of America Securities LLC, as Sole Lead
Arranger and Sole Book Manager, YC SUSI Trust, as Conduit Lender, Bank of
America, N.A., as an Administrator, Alternate Lender and Managing Agent and the
other Conduit Lenders, Administrators, Alternate Lenders and Managing Agents
from time to time party thereto, after a drawing has been made under Letter of
Credit No._______dated_____, 200___, issued by for the account of Maker and the
benefit of __________(the "Letter of Credit"), and is one of the "Qualified
Borrower Letter of Credit Notes" referred to in the Credit Agreement and the
holder of this Note shall be entitled to the benefits provided in the Credit
Agreement. This Note evidences Loans made during the Commitment Period under the
Credit Agreement. Reference is hereby made to the Credit Agreement for a
statement of: (a) the obligation of Payee to make advances hereunder; (b) the
prepayment rights and obligations of Maker; (c) the collateral for the repayment
of the Note; and (d) the events upon which the maturity of this Note may be
accelerated. Maker may borrow, repay and reborrow hereunder upon the terms and
conditions specified in the Credit Agreement. The repayment of this Note is
secured by a guaranty of Borrower. Notwithstanding the foregoing, should any of
the events described in Sections 12.1(g) or 12.1(h) of the Credit Agreement
occur with respect to Maker, then the principal of or accrued interest on this
Note shall become immediately due and payable without presentment, demand,
protest or other notice of any kind, all of which are hereby waived by Maker.
 
6.            If this Note, or any installment or payment due hereunder, is not
paid when due, whether at maturity or by acceleration, or if it is collected
through a bankruptcy, probate or other court, whether before or after maturity,
Maker agrees to pay all out-of-pocket costs of collection, including, but not
limited to, reasonable attorneys' fees incurred by the holder hereof and costs
of appeal. All past-due principal of, and, to the extent permitted by applicable
law, past-due interest on this Note, shall bear interest until paid at the
Default Rate as provided in the Credit Agreement.
 
7.            Maker and all sureties, endorsers, guarantors and other parties
ever liable for payment of any sums payable pursuant to the terms of this Note,
jointly and severally waive demand, presentment for payment, protest, notice of
protest, notice of acceleration, notice of intent to accelerate, diligence in
collection, the bringing of any suit against any party, and any notice of or
defense on account of any extensions, renewals, partial payment, or any releases
or substitutions of any security, or any delay, indulgence, or other act of any
trustee or any holder hereof, whether before or after maturity.
 
8.            Pursuant to Section 5-1401 of the New York General Obligations
Law, the substantive laws of the State of New York, without regard to the choice
of law principles that might otherwise apply, and the applicable federal laws of
the United States of America, shall govern the validity, construction,
enforcement and interpretation of this Note.
 
2
 
Exhibit B-3

--------------------------------------------------------------------------------

 
 
9.                      By its execution hereof, Maker hereby agrees to be bound
by the terms and conditions of the Credit Agreement as if it were a signature
party thereto.
 
10.            Reference is hereby made to Section 14.19 of the Credit Agreement
regarding the non-personal liability of Managing Member or any other Investor,
the provisions of which are hereby incorporated by reference in this Note as if
fully set forth herein, for the payment and performance of Maker's obligations
hereunder.
 
REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.
SIGNATURE PAGE FOLLOWS.
 
3
 
Exhibit B-3

--------------------------------------------------------------------------------

 
 

 
BORROWER:
     
[QUALIFIED BORROWER]
         
By:
 
Name:
 
Title:

 
4
 
Exhibit B-3

--------------------------------------------------------------------------------

 
 
Date
Borrowing Amount
Payment
Aggregate
Unpaid Amount
                                                                               
                                                       

 
5
 
Exhibit B-3

--------------------------------------------------------------------------------

 
 
EXHIBIT C
to Revolving Credit Agreement
by and among
Acadia Strategic Opportunity Fund III LLC, as Borrower,
Acadia Realty Acquisition III LLC, as Managing Member,
Acadia Realty Limited Partnership, as Guarantor,
Acadia Investors III, Inc., as Pledgor,
Bank of America, N.A., as Administrative Agent,
Banc of America Securities LLC, as Sole Lead Arranger and Sole Book Manager,
YC SUSI Trust, as Conduit Lender,
Bank of America, N.A., as an Administrator, Alternate Lender and Managing Agent,
and
the other Conduit Lenders, Administrators, Alternate Lenders and Managing Agents
from
time to time party thereto
 
FORM OF LOAN NOTICE
 
[DATEI]
Bank of America, N.A., as Administrative Agent
NC1-027-19-01
214 North Tryon Street
Charlotte, NC 28255
Attention:
Brian S. Williams
Telephone:
(704) 683-4747
Telecopy:
(704) 968-1215

Ladies and Gentlemen:
 
This Loan Notice is executed and delivered by Acadia Strategic Opportunity Fund
III LLC, a Delaware limited liability company ("Borrower") [and NAME OF
QUALIFIED BORROWER], to Bank of America, N.A. ("Administrative Agent"), pursuant
to Section 2.3 of that certain Revolving Credit Agreement (as amended, modified,
supplemented or restated from time to time, the "Credit Agreement") dated as of
October 10, 2007, entered into by and among Borrower, Acadia Realty Acquisition
III LLC, a Delaware limited liability company, as Managing Member, Acadia Realty
Limited Partnership, a Delaware limited partnership, as Guarantor, Acadia
Investors III, Inc., a Maryland corporation, as Pledgor, Administrative Agent,
Banc of America Securities LLC, as Sole Lead Arranger and Sole Book Manager, YC
SUSI Trust, as Conduit Lender, Bank of America, N.A., as an Administrator,
Alternate Lender and Managing Agent and the other Conduit Lenders,
Administrators, Alternate Lenders and Managing Agents from time to time party
thereto. Capitalized terms not defined herein shall have the meanings assigned
to such terms in the Credit Agreement.
 
1.
Pursuant to Section 2.3(a) of the Credit Agreement, the Borrower hereby requests
a Borrowing:

 
 
Exhibit C

--------------------------------------------------------------------------------

 
 
(a)            In the amount of $_________________1
(b)            On________________(a Business Day)
 
2.          In connection with the Borrowing requested herein, Borrower hereby
represents, warrants, and certifies to Administrative Agent for the benefit of
the Secured Parties that:
 
(a)            As of the date of the Borrowing requested herein, each
representation and warranty made by Borrower in Section 9 of the Credit
Agreement is true and correct in all material respects both immediately before
and, after giving effect to such Borrowing, after, the date of such Borrowing,
with the same force and effect as if made on and as of such date (except to the
extent of changes in facts or circumstances that have been disclosed to
Lenders);
 
(b)            The conditions specified in Sections 8.1, 8.2 (if applicable) and
8.3 have been satisfied as of the date hereof.,
 
(c)            No Event of Default or Potential Default exists and is continuing
on and as of the date hereof; and
 
 
(d)
Following the requested Borrowing, the Principal Obligation (the aggregate
outstanding principal amount of the Loans plus the Letter of Credit Liability)
will be $_ plus accrued, unpaid interest;

 
(e)            After giving effect to such Borrowing the Principal Obligation on
and as of such date will not exceed the Available Loan Amount on and as of such
date; and
 
(f)            The Borrowing Base Certificate attached hereto as Schedule I is
true and correct as of the date hereof.
 
3.             Following are Borrower's (or Qualified Borrower's) instructions
for distribution of loan proceeds (appropriate wire instructions, etc.):
 
[Bank Name]
ABA No.: [ABA No.]
Account No.: [Account No.]
Reference No.: [Reference No.]
 
REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.
SIGNATURE PAGE FOLLOWS.
 

 

--------------------------------------------------------------------------------

2 At least $500,000 at all times when there is only one Alternate Lender party
to the Credit Agreement and at least $1,000,000 at all times when there are two
or more Alternate Lenders party to the Credit Agreement.
 
2
 
 
Exhibit C

--------------------------------------------------------------------------------

 
 
This Loan Notice is executed on ________________________, 20_. The undersigned
hereby certifies each and every matter contained herein to be true and correct.
 

 
BORROWER:
     
ACADIA STRATEGIC OPPORTUNITY FUND III
 
LLC, a Delaware limited liability company
         
By: /s/ Robert Masters
 
Name: Robert Masters
 
Title: Senior Vice President

 

 
[QUALIFIED BORROWER]
         
By:
 
Name:
 
Title:

 
Signature Page to
Loan Notice
 
 
Exhibit C

--------------------------------------------------------------------------------

 
 
Schedule I
 
(Calculation of Borrowing Base)
 
[See Attached]
 
 
Exhibit C

--------------------------------------------------------------------------------

 
 
EXHIBIT D-1
to Revolving Credit Agreement
by and among
Acadia Strategic Opportunity Fund III LLC, as Borrower,
Acadia Realty Acquisition III LLC, as Managing Member,
Acadia Realty Limited Partnership, as Guarantor,
Acadia Investors III, Inc., as Pledgor,
Bank of America, N.A., as Administrative Agent,
Banc of America Securities LLC, as Sole Lead Arranger and Sole Book Manager,
YC SUSI Trust, as Conduit Lender,
Bank of America, N.A., as an Administrator, Alternate Lender and Managing Agent,
and
the other Conduit Lenders, Administrators, Alternate Lenders and Managing Agents
from
time to time party thereto
 
FORM OF REQUEST FOR LETTER OF CREDIT
 
[DATE]
Bank of America, N.A., as Administrative Agent
NC 1-027-19-01
214 North Tryon Street
Charlotte, NC 28255
 
Attention:
Brian S. Williams
Telephone:
(704) 683-4747
Telecopy:
(704) 968-1215

Ladies and Gentlemen:
 
This Request for Letter of Credit (this "Request for Letter of Credit") is
executed and delivered by Acadia Strategic Opportunity Fund III LLC, a Delaware
limited liability company [and NAME OF QUALIFIED BORROWER] ([together, ]
"Applicant"), to Bank of America, N.A. ("Administrative Agent"), pursuant to
Section 2.5(b) of that certain Revolving Credit Agreement (as amended, modified,
supplemented or restated from time to time, the "Credit Agreement") dated as of
October 10, 2007, entered into by and among Applicant, Acadia Realty Acquisition
III LLC, a Delaware limited liability company, as Managing Member, Acadia Realty
Limited Partnership, a Delaware limited partnership, as Guarantor, Acadia
Investors III, Inc., a Maryland corporation, as Pledgor, Administrative Agent,
Banc of America Securities LLC, as Sole Lead Arranger and Sole Book Manager, YC
SUSI Trust, as Conduit Lender, Bank of America, N.A., as an Administrator,
Alternate Lender and Managing Agent and the other Conduit Lenders,
Administrators, Alternate Lenders and Managing Agents from time to time party
thereto. Capitalized terms not defined herein shall have the meanings assigned
to such terms in the Credit Agreement. Applicant has contemporaneously executed
and delivered to Administrative Agent for the Letter of Credit Issuer an
Application and Agreement for Letter of Credit dated [DATE]. In the event of a
conflict between the terms of the Credit Agreement and said Application and
Agreement for Letter of Credit, the terms of the Credit Agreement will control.
 
 
Exhibit D-1

--------------------------------------------------------------------------------

 
 
1.
Applicant hereby requests that the Letter of Credit Issuer [issue] [amend] a
Letter of Credit, as follows:

 
For issuances:
 
Proposed Issuance Date (a Business Day): Stated Amount:
Expiration Date:
 
Beneficiary Name and Address:
 
Documents to be Presented
in case of Drawing: [please attach as a schedule hereto]
 
Full Text of Certificate be Presented
in case of Drawing: [please attach as a schedule hereto]
 
For amendments:
 
Letter of Credit to be amended:
 
Proposed Date of Amendment (a Business Day):
 
Nature of the proposed amendment:
 
2.
In connection with the [issuance] [amendment] of the Letter of Credit requested
herein, Applicant hereby represents, warrants, and certifies, as applicable, to
Administrative Agent for the benefit of the Secured Parties and the Letter of
Credit Issuer that:

 
(a)           As of the date of the [issuance] [amendment] of the Letter of
Credit requested herein, each representation and warranty made by Applicant in
Section 9 of the Credit Agreement is and will be true and correct in all
material respects both immediately before and, after giving effect to such
[issuance] [amendment] of the Letter of Credit, after, the date of such issuance
of the Letter of Credit, with the same force and effect as if made on and as of
such date (except to the extent of changes in facts or circumstances that have
been disclosed to Lenders);
 
(b)           No Event of Default, Potential Default or Implicit Borrowing Base
Deficit exists and is continuing on and as of the date of the [issuance]
[amendment] of the Letter of Credit requested herein, or will result therefrom;
 
2
 
Exhibit D-1

--------------------------------------------------------------------------------

 
 
(c)           As of the date of the [issuance] [amendment] of the Letter of
Credit requested herein, the Unfunded Capital Commitment of the Included
Investors and the Designated Investors will be $_______________; 
 
(e)           Following the [issuance] [amendment] of a requested Letter of
Credit, the Letter of Credit Liability will be $____________________;
 
(f)           After giving effect to the [issuance] [amendment] of the requested
Letter of Credit, the Principal Obligation (the aggregate outstanding principal
amount of the Loans plus the Letter of Credit Liability) on and as of such date
will not exceed the Available Loan Amount on and as of such date;
 
(g)           After giving effect to such issuance of the Letter of Credit, the
Letter of Credit Liability will not exceed 75% of the Facility Amount as of the
date hereof; and
 
(h)           The calculation of the Borrowing Base attached hereto as Schedule
I is true and correct as of the date hereof.
 
REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.
SIGNATURE PAGES FOLLOW.
 
3
 
Exhibit D-1

--------------------------------------------------------------------------------

 
 
This Request for Letter of Credit is executed as of the date first written
above. The undersigned hereby certifies each and every matter contained herein
to be true and correct.
 

 
BORROWER:
     
ACADIA STRATEGIC OPPORTUNITY FUND III
 
LLC, a Delaware limited liability company
         
By: /s/ Robert Masters
 
Name: Robert Masters
 
Title: Senior Vice President

 

 
[QUALIFIED BORROWER]
         
By:
 
Name:
 
Title:

 
Signature Page to
Request for Letter of Credit
 
 
Exhibit D-1

--------------------------------------------------------------------------------

 
 
Applicant and Bank of America hereby agree that the terms and conditions of this
Application and Agreement for Letter of Credit shall be controlled by Section
2.5 of the Revolving Credit Agreement, dated October 10, 2007, by and among
Acadia Strategic Opportunity Fund III LLC, as Borrower, Acadia Realty
Acquisition III LLC, as Managing Member, Acadia Realty Limited Partnership, as
Guarantor, Acadia Investors III, Inc., as Pledgor, Bank of America, N.A., as
Administrative Agent, the Lenders named therein and the other Persons from time
to time party thereto.
 

 
APPLICANT:
     
ACADIA STRATEGIC OPPORTUNITY FUND III
 
LLC, a Delaware limited liability company
         
By: /s/ Robert Masters
 
Name: Robert Masters
 
Title: Senior Vice President

 

 
[QUALIFIED BORROWER]
         
By:
 
Name:
 
Title:

 

 
ISSUER:
      BANK OF AMERICA, N.A.      
By:
 
Name:
 
Title:

 
 
Exhibit D-1

--------------------------------------------------------------------------------

 
 
Schedule I
 
(Calculation of Borrowing Base)
 
[See Attached]
 
2
 
Exhibit D-1

--------------------------------------------------------------------------------

 
 
EXHIBIT D-2
to Revolving Credit Agreement
by and among
Acadia Strategic Opportunity Fund III LLC, as Borrower,
Acadia Realty Acquisition III LLC, as Managing Member,
Acadia Realty Limited Partnership, as Guarantor,
Acadia Investors III, Inc., as Pledgor,
Bank of America, N.A., as Administrative Agent,
Banc of America Securities LLC, as Sole Lead Arranger and Sole Book Manager,
YC SUSI Trust, as Conduit Lender,
Bank of America, N.A., as an Administrator, Alternate Lender and Managing Agent,
and
the other Conduit Lenders, Administrators, Alternate Lenders and Managing Agents
from
time to time party thereto
 
FORM OF LETTER OF CREDIT
 
IRREVOCABLE LETTER OF CREDIT NO. [__]
[Date of Issuance]
 
To:
[Name of Beneficiary]
[Address of Beneficiary]

 
Ladies and Gentlemen:
 
At the request and for the account of Acadia Strategic Opportunity Fund III LLC
(the "Account Party") which we have been advised by the applicant is pursuant to
the Credit Agreement between us and the Account Party, dated October 10, 2007,
(as amended, modified, supplemented or restated from time to time, the "Credit
Agreement"), we hereby establish this Irrevocable Letter of Credit (the "Letter
of Credit") in your favor to secure the obligations of the Account Party
under [______] in accordance with the following terms and conditions:
 
 
3.
Expiration. This Letter of Credit shall automatically expire at the close of
business on the earliest of:

 
 
1.
[Date], but such expiration date shall be automatically extended without
amendment for a period of one (1) year from the present or any future expiration
date, but in no event later than
, unless, at least 30 days before any expiration date, we notify you by
registered mail or overnight courier service at the above address, that this
Letter of Credit is not extended beyond the current expiration date; and

 
 
2.
our receipt of your certificate in the form of Annex A-1 hereto appropriately
completed, together with this Letter of Credit.

 
 
Exhibit D-2

--------------------------------------------------------------------------------

 
 
In the event such expiration date shall not be a Business Day (as hereinafter
defined) then this Letter of Credit shall expire on the next succeeding Business
Day.
 
4.
Stated Amount. The aggregate amount available under this Letter of Credit shall
be [______] in U.S. Dollars, which amount as from time to time reduced as
provided in paragraph 3 is hereinafter referred to as the "Stated Amount."

 
5.
Reductions in the Stated Amount. The Stated Amount shall be reduced
automatically from time to time upon our honoring of a demand for payment
hereunder by an amount equal to the amount of such payment. The Stated Amount
may also be reduced from time to time at your written directions in the form of
Annex A-2 hereto.

 
6.
Documents To Be Presented. Funds under this Letter of Credit are available to
you against a certificate signed by you in the form of Annex A-3 hereto
appropriately completed (a "Drawing").

 
7.
Method and Notice of Presentment. The certificate referenced in paragraph 4 (a
"demand for payment") may be delivered to us in person, by mail, by an express
delivery service, or by telecopy to our fax number [_______] A demand for
payment shall be presented during our business hours on a Business Day prior to
the expiration hereof at our office at [____]. As used herein, "Business Day"
means any day other than (i) a Saturday or Sunday or (ii) a day on which the New
York Stock Exchange is closed or Banks in New York or Charlotte, North Carolina
are authorized to close.
 

 
8.                      Time and Method for Payment.
 
 
1.
If a demand for payment is made on a Business Day to us prior to 11:00 a.m. in
strict conformity with the terms and conditions hereof, payment shall be made to
you, not later than 3:30 p.m. on the second succeeding Business Day (or third
succeeding Business Day if the account is outside the United States) or such
later date as you may specify in such demand for payment. All times referenced
herein are as of New York, New York time.

 
 
2.
Unless otherwise agreed, payment under this Letter of Credit shall be made in
immediately available funds to such bank accounts specified by you in the demand
for payment.

 
9.
Transferability. This Letter of Credit is transferable. Transfer of this Letter
of Credit is subject to our receipt of your instructions in the form attached
hereto as Annex A-4 accompanied by the original Letter of Credit and all
amendment(s), if any. Costs or expenses of such transfer shall be for your
account.

 
10.
GOVERNING LAW AND CUSTOMS. TO THE EXTENT CONSISTENT WITH THE EXPRESS PROVISIONS
HEREOF, THIS LETTER OF CREDIT SHALL BE GOVERNED BY THE INTERNATIONAL STANDBY
PRACTICES - ISP98 ("ISP98"), AND TO THE EXTENT CONSISTENT WITH THE EXPRESS 
PROVISIONS HEREOF AND NOT GOVERNED BY THE ISP98, THIS LETTER OF CREDIT SHALL BE
GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

 
2
 
Exhibit D-2

--------------------------------------------------------------------------------

 

11.           Irrevocability. This Letter of Credit shall be irrevocable.
 
12.
No Negotiation. A demand for payment under this Letter of Credit shall be
presented directly to us and shall not be negotiated to or by any third party.

 
13.
Address for Communications. Communications with respect to this Letter of Credit
shall be in writing and shall be addressed to us at the addresses referenced in
paragraph 5, specifically referred thereon to our Irrevocable Letter of Credit
No. [_____________].
 

 
14.
Complete Agreement. This Letter of Credit, including Annex A-1 through A-4
hereto, sets forth in full the terms of our undertaking. Reference in this
Letter of Credit to other documents or instruments is for identification
purposes only and such reference shall not modify or affect the terms hereof or
cause such documents or instruments to be deemed incorporated herein.

 
3
 
Exhibit D-2

--------------------------------------------------------------------------------

 
 
We hereby agree with you to honor your demand for payment presented in strict
compliance with the terms and conditions of this Letter of Credit.
 

 
Very truly yours,
      BANK OF AMERICA, N.A.      
By:
 
Name:
 
Title:

 
4
 
Exhibit D-2

--------------------------------------------------------------------------------

 
 
ANNEX A-1
 
TERMINATION CERTIFICATE REPAYMENT
 
Re:           Irrevocable Letter of Credit No. [__________]
 
The undersigned, a duly authorized officer of [______] (the "Beneficiary"),
hereby certifies to Bank of America, N.A. (the "Bank"), with reference to
Irrevocable Letter of Credit No. [_______] (the "Letter of Credit", any
capitalized term used herein and not defined shall have its respective meaning
as set forth in the Letter of Credit) issued by the Bank in favor of the
Beneficiary, that the Account Party is not required to maintain the Letter of
Credit at this time.
 
The Letter of Credit is attached hereto and being surrendered to you herewith.
 
IN WITNESS WHEREOF, the Beneficiary has executed and delivered this Certificate
as of theday of, 20__.
 

  [BENEFICIARY]      
By:
 
Name:
 
Title:

 
5
 
Exhibit D-2

--------------------------------------------------------------------------------

 
 
ANNEX A-2
 
REDUCTION CERTIFICATE
 
Re:           Irrevocable Letter of Credit No. [__________]
 
The undersigned, a duly authorized officer of [_______] (the "Beneficiary"),
hereby certifies to Bank of America, N.A. (the "Bank"), with reference to
Irrevocable Letter of Credit No. [______] (the "Letter of Credit", any
capitalized term used herein and not defined shall have its respective meaning
as set forth in the Letter of Credit) issued by the Bank in favor of the
Beneficiary, that the Stated Amount of the Letter of Credit shall permanently be
reduced to U.S. $_____________.
 
 
IN WITNESS WHEREOF, the Beneficiary has executed and delivered this Certificate
as of theday of, 20__
 

  [BENEFICIARY]      
By:
 
Name:
 
Title:

 
6
 
Exhibit D-2

--------------------------------------------------------------------------------

 
 
ANNEX A-3
 
CERTIFICATE FOR DRAWING
 
 
Re:  Irrevocable Letter of Credit No. [____________]
 
The undersigned, a duly authorized officer of [________] (the "Beneficiary"),
hereby demands payment in the amount of U.S. $ [_________] (the "Drawing") from
Bank of America, N.A. (the "Bank"), under Irrevocable Letter of Credit No.
[_________] (the "Letter of Credit", any capitalized term used herein and not
defined shall have its respective meaning as set forth in the Letter of Credit)
issued by the Bank in favor of the Beneficiary.
 
The undersigned hereby certifies that:
 
(a)           The Beneficiary is making this Drawing by reason of: [check (i) or
(ii) as applicable]
 
(i)            Pursuant to the terms of the  [______] dated [______], between
the Beneficiary and [______] (the " [___________] Agreement"); or
 
(ii)            The Beneficiary has received a notice of Non-Renewal from Bank
of America, N.A. and has not received a replacement Letter of Credit acceptable
to the Beneficiary.
 
(b)           The Beneficiary has not issued a certificate in the form of Annex
A-1 to the Letter of Credit.
 
(c)           The Drawing does not exceed the Stated Amount less any previous
Drawing.
 
(d)           The proceeds of this Drawing shall be applied solely in accordance
with the terms of the [_________] Agreement.
 
(e)           (i) Payment of this demand for payment is requested on or before
3:30 p.m., the second Business Day succeeding (or, if the account specified
below is outside the United States, three Business Days after) the Business Day
on which this Certificate is received or deemed to have been received by the
Bank in accordance with paragraph 5 of the Letter of Credit.
 
(ii) Payment of this demand for payment shall be made to the Beneficiary by
credit to the following account:
 
[Beneficiary]
[Account Information]
 
7
 
Exhibit D-2

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IN WITNESS WHEREOF, the Beneficiary has executed and delivered this Certificate
as of theday of, 20__
 

  [BENEFICIARY]      
By:
 
Name:
 
Title:

 
8
 
Exhibit D-2

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ANNEX A-4
 
TRANSFER FORM
 
___________,200_
 
Bank of America N.A. [applicable address]
 
Re:           Irrevocable Standby Letter of Credit
No.                                                                        
 
We request you to transfer all of our rights as beneficiary under the Letter of
Credit referenced above to the transferee, named below:
 
Name of Transferee
 

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Address
 

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By this transfer all our rights as the original beneficiary, including all
rights to make drawings under the Letter of Credit, go to the transferee. The
transferee shall have sole rights as beneficiary, whether existing now or in the
future, including sole rights to agree to any amendments, including increases or
extensions or other changes. All amendments will be sent directly to the
transferee without the necessity of consent by or notice to us.
 
We enclose the original letter of credit and any amendments thereto. Please
indicate your acceptance of our request for the transfer by endorsing the letter
of credit and sending it to the transferee with your customary notice of
transfer.
 
For your transfer fee of $250.00
 
*            Enclosed is our check for
$_________________                                                                              
 
*            You may debit my/our Account
No.___________                                                      
 
We also agree to pay you on demand any expenses which may be incurred by you in
connection with this transfer.
 
9
 
Exhibit D-2

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The signature and title at the right conform with those shown in our files as
authorized to sign for the beneficiary. Policies governing signature
authorization as required for withdrawals from customer accounts shall also be
applied to the authorization of signatures on this form. The authorization of
the Beneficiary's signature and title on this form also acts to certify that the
authorizing financial institution (i) is regulated by a U.S. federal banking
agency; (ii) has implemented anti-money laundering policies and procedures that
comply with applicable requirements of law, including a Customer Identification
Program (CIP) in accordance with Section 326 of the USA PATRIOT Act; (iii) has
approved the Beneficiary under its anti-money laundering compliance program; and
(iv) acknowledges that Bank of America, N.A. is relying on the foregoing
certifications pursuant to 31 C.F.R. Section 103.121 (b)(6).
 
 
 

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NAME OF BANK
 
 

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AUTHORIZED SIGNATURE AND TITLE
 
 

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PHONE NUMBER
 

 

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NAME OF TRANSFEROR
 
 

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NAME OF AUTHORIZED SIGNER AND TITLE
 
 

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AUTHORIZED SIGNATURE
 
10
 
Exhibit D-2

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EXHIBIT E
to Revolving Credit Agreement
by and among
Acadia Strategic Opportunity Fund III LLC, as Borrower,
Acadia Realty Acquisition III LLC, as Managing Member,
Acadia Realty Limited Partnership, as Guarantor
Acadia Investors III, Inc., as Pledgor,
Bank of America, N.A., as Administrative Agent,
Banc of America Securities LLC, as Sole Lead Arranger and Sole Book Manager,
YC SUSI Trust, as Conduit Lender,
Bank of America, N.A., as an Administrator, Alternate Lender and Managing Agent,
and
the other Conduit Lenders, Administrators, Alternate Lenders and Managing Agents
from
time to time party thereto
 
BORROWER AND MANAGING MEMBER SECURITY AGREEMENT
 
THIS SECURITY AGREEMENT (as amended, modified, supplemented or restated from
time to time, this "Security Agreement") is executed and delivered as of October
10, 2007 by Acadia Strategic Opportunity Fund III LLC, a Delaware limited
liability company ("Borrower"), and Acadia Realty Acquisition III LLC, a
Delaware limited liability company ("Managing Member"), in favor of BANK OF
AMERICA, N.A., a national banking association, as Administrative Agent
("Administrative Agent"), for the benefit of Secured Parties (hereinafter
defined). Capitalized terms not defined herein shall have the meanings assigned
to such terms in the Credit Agreement referred to below.
 
A.            Formation. Borrower was formed pursuant to that certain Operating
Agreement, dated as of May 15, 2007 (as the same may be restated, modified,
amended or supplemented from time to time, the "Operating Agreement").
 
B.            Capital Calls. Pursuant to Section 5.2 of the Operating Agreement,
Managing Member may make one or more Capital Calls upon the Investors to make
Capital Contributions to the capital of Borrower subject to certain limitations
specified in the Operating Agreement.
 
C.            Credit Agreement. Borrower, Managing Member, Acadia Realty Limited
Partnership, a Delaware limited partnership, as Guarantor, Acadia Investors III,
Inc., a Maryland corporation, as Pledgor, Administrative Agent, Banc of America
Securities LLC, as Sole Lead Arranger and Sole Book Manager, YC SUSI Trust, as
Conduit Lender, Bank of America, N.A., as an Administrator, Alternate Lender,
and Managing Agent and the other Conduit Lenders, Administrators, Alternate
Lenders and Managing Agents from time to time party thereto, have entered into a
Revolving Credit Agreement, dated as of October 10, 2007, relating to a
revolving credit loan (as amended, modified, supplemented, or restated from time
to time, the "Credit Agreement"). Administrative Agent, the Lenders, Agents,
Letter of Credit Issuer, Program Support Providers, Conduit Collateral Agents
and Indemnitees are herein collectively referred to as "Secured Parties" and
each individually referred to as a "Secured Party." To secure Borrower's
obligations under the Credit Agreement, Borrower and Managing Member have agreed
to pledge and assign to Administrative Agent, for the benefit of Secured
Parties, Borrower's and Managing Member's rights to make Capital Calls under the
Operating Agreement, Borrower's rights to receive payment of each Investor's
Capital Contributions, and Managing Member's right to enforce Capital Calls and
the payment of Capital Contributions by each Investor.
 
 
Borrower and Managing Member Security Agreement

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1. Collateral and Obligations. In order to secure the Notes and the Obligations,
Borrower and Managing Member hereby grant to Administrative Agent for the
benefit of Secured Parties, to the extent permitted by law, and subject to the
terms and conditions of this Security Agreement, a first priority security
interest and Lien in and to all of their respective rights in the following (the
"Collateral"):
 
a.            Borrower's and Managing Member's right to issue Capital Call
Notices, to make Capital Calls of the Capital Commitments, and all other rights,
titles, interests, powers and privileges related to, appurtenant to or arising
out of Borrower's and Managing Member's right to require or demand that
Investors make Capital Contributions to the capital of Borrower;
 
b.            Borrower's and Managing Members' rights, titles, interests and
privileges in and to the Capital Commitments and the Capital Contributions,
whether now owned or hereafter acquired; and
 
c.            Borrower's and Managing Member's rights, titles, interests,
remedies, and privileges under the Operating Agreement related to the Capital
Commitments and to receive the same, or the enforcement thereof, including,
without limitation, those rights and remedies as contemplated in Article 5 of
the Operating Agreement and those rights and remedies of the Borrower and
Managing Member pursuant to that certain pledge agreement, dated as of May 15,
2007, between the Borrower and Acadia Investors III, Inc.
 
Administrative Agent acknowledges that, with respect to any member of Borrower,
the Collateral does not include a security interest in any equity interest of
such member in Borrower.
 
Administrative Agent, in its discretion, without in any manner impairing any
rights and powers of Secured Parties hereunder, may, at any time and from time
to time, without further consent of or notice to Borrower or Managing Member,
with or without valuable consideration file this Security Agreement or a
photocopy hereof, or any financing statement with respect hereto (and any
amendment, modification, supplement or continuation in respect of any such
financing statement).
 
Each of the Borrower and the Managing Member hereby authorizes the filing of any
financing statement or any amendment related thereto, in any jurisdiction and
with any filing offices as the Administrative Agent may determine, in its sole
discretion, are necessary or advisable to perfect the security interest granted
to the Administrative Agent in connection herewith. Such financing statement may
describe the Collateral in the same manner as described in this Security
Agreement or may contain an indication or description of the Collateral that
describes such property more generally as all of Borrower's and Managing
Member's rights, titles, interests and remedies in, to and under the Operating
Agreement, as amended from time to time, including without limitation, all
rights to make, receive and enforce all of each Borrower's and Managing Member's
right, title and interest, whether now existing of hereafter created or arising,
in and to the Collateral Account maintained with Bank of America, N.A., either
generally or specifically by name, account number and/or ABA number, and all
sums now or at any time hereafter on deposit therein, credited thereto or
payable thereon, all proceeds and products thereof, and all instruments,
documents, certificates, and other writings evidencing such collateral accounts,
and all proceeds of all of the foregoing.
 
 
 

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In order to secure further the payment and the performance of the Obligations,
Borrower and Managing Member shall execute such forms, authorizations, documents
and instruments, and do such other things, as Administrative Agent shall
request, in order to require that all Investors deliver directly to
Administrative Agent for the benefit of Secured Parties all monies or sums paid
or to be paid by them as and when Capital Calls are made pursuant to the
Operating Agreement. Administrative Agent, on behalf of Secured Parties, is
hereby authorized, in its own name or the name of Borrower or Managing Member,
at any time upon the occurrence and during the continuation of an Event of
Default, to notify any or all parties obligated to Borrower with respect to the
Capital Contributions to make all payments due or to become due thereon directly
to Administrative Agent for the benefit of Secured Parties at a different
account than that specified in the Credit Agreement, or to initiate one or more
Capital Calls in order to pay the Obligations or for any other purpose
contemplated by the Credit Agreement (which Capital Calls may be in excess of
the amount owing under the Credit Agreement if required in order to comply with
ERISA or otherwise result in payment in full of the Obligations). With or
without such general notification, upon the occurrence and during the
continuation of an Event of Default, Administrative Agent, on behalf of Secured
Parties, may: (i) take or bring in Borrower's or Managing Member's name or that
of Administrative Agent for the benefit of Secured Parties all steps, actions,
suits or proceedings reasonably deemed by Administrative Agent necessary or
desirable to effect possession or collection of payments; (ii) complete any
contract or agreement of Borrower in any way related to any of the Capital
Calls; (iii) make allowances or adjustments related to the Capital Calls; (iv)
compromise any claims related to the Capital Calls; or (v) issue credit in its
own name or the name of Borrower or Managing Member. Regardless of any provision
hereof,  IN THE ABSENCE OF GROSS NEGLIGENCE OR WILLFUL MISCONDUCT by
Administrative Agent or Secured Parties, or both, neither Administrative Agent
nor Secured Parties shall be liable for the failure of Administrative Agent to
collect or exercise diligence in the collection, possession or any transaction
concerning, all or part of the Capital Calls or sums due or paid thereon, nor
shall Administrative Agent or Secured Parties be under any obligation whatsoever
to anyone by virtue of the security interests and liens granted herein.
 
Upon the occurrence and during the continuation of an Event of Default, issuance
by Administrative Agent, on behalf of Secured Parties, of a receipt to any
person obligated to pay any Capital Contributions to Borrower shall be a full
and complete release, discharge and acquittance of such person to the extent of
any amount so paid to Administrative Agent for the benefit of Secured Parties.
Administrative Agent, on behalf of Secured Parties, is hereby authorized and
empowered, upon the occurrence and during the continuation of an Event of
Default, on behalf of Borrower and Managing Member to endorse the name of
Borrower or Managing Member, or both, upon any check, draft, instrument,
receipt, instruction or other document or item, including, but not limited to,
all items evidencing payment upon a Capital Contribution of any person to
Borrower coming into Administrative Agent's or any Secured Party's possession,
and to receive and apply the proceeds therefrom in accordance with the terms of
the Credit Agreement.
 
 
 

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Administrative Agent, on behalf of Secured Parties, is hereby granted an
irrevocable power of attorney, which is coupled with an interest, to execute all
checks, drafts, receipts, instruments, instructions or other documents,
agreements or items on behalf of Borrower or Managing Member, or both, upon the
occurrence and during the continuation of an Event of Default, as shall be
deemed by Administrative Agent to be necessary or advisable, in the sole
discretion, reasonably exercised, of Administrative Agent, to protect the
security interests and Liens herein granted or the repayment of the Obligations,
and neither Administrative Agent nor any Secured Party shall incur any liability
in connection with or arising from the exercise of such authority and power,
except as a result of gross negligence or willful misconduct.
 
2. Warranties and Covenants. Borrower and Managing Member hereby warrant to
Administrative Agent for the benefit of Secured Parties and covenant and agree
with Administrative Agent for the benefit of the Secured Parties as follows:
 
a.            That Borrower is the sole legal and equitable owner of the Capital
Commitments and the Capital Contributions (with respect to its members) and has
the authority to execute this Security Agreement, and this Security Agreement
constitutes the legal, valid and binding obligation of Borrower enforceable in
accordance with the terms hereof, subject to Debtor Relief Laws and to general
principles of equity; and that Managing Member is the sole, legal and equitable
owner and holder of the right to issue Capital Call Notices and to make Capital
Calls (with respect to its members) (other than the Administrative Agent) and
has the authority to execute this Security Agreement, and this Security
Agreement constitutes the legal, valid and binding obligation of Managing Member
enforceable in accordance with the terms hereof, subject to Debtor Relief Laws
and to general principles of equity;
 
b.            That neither Borrower nor Managing Member has heretofore
transferred, assigned, pledged, hypothecated or granted any security interest in
all or any portion of the Collateral; that they have full right and power to
make the transfer, pledge and assignment and grant the security interests
granted hereby; that, to the extent required by the Operating Agreement, all
Investors have been notified of, and have approved and consented to, the
transfer, pledge and assignment contained herein; and that this instrument is
effective to accomplish the transfer, pledge and assignment and grant of the
security interests granted hereby;
 
c.            That Borrower and Managing Member have received direct or indirect
benefit from the Loans evidenced by the Notes; and that the grant of the
security interest in the Collateral hereunder was a condition to the granting of
such loans;
 
d.            That Borrower and Managing Member shall, at their respective sole
cost and expense, execute and deliver any financing statements or other
documents which Administrative Agent reasonably requests to protect or perfect
the assignment, pledge, transfer and grant of the security interest made herein;
 
 
 

--------------------------------------------------------------------------------

 
 
e.           That neither Administrative Agent nor Secured Parties shall be
responsible in any way for any depreciation in the value of the Collateral nor
have any duty or responsibility whatsoever to take any steps to preserve any
rights of Borrower or Managing Member in the Collateral or under the Operating
Agreement;
 
f.           That Borrower shall not sell, mortgage, hypothecate, assign or
otherwise transfer its interest in the Capital Commitments, the Capital
Contributions or the Collateral Account, or any portion of or interest in
either, without the prior written consent of Administrative Agent, on behalf of
Secured Parties; that Managing Member shall not sell, mortgage, hypothecate,
assign or otherwise transfer its interests in its right to issue Capital Call
Notices or to make Capital Calls or any portion of or interest therein without
the prior written consent of Administrative Agent, on behalf of Secured Parties;
 
g.           That Administrative Agent, on behalf of Secured Parties, is
authorized and empowered to make one or more Capital Calls upon the occurrence
and continuance of an Event of Default in order to pay the Notes and Obligation,
without the necessity of any further action by Managing Member or Borrower; and
 
h.           That neither Borrower nor the Managing Member shall: (i) issue any
Capital Call Notice(s) other than as contemplated by Section 5.2 of the Credit
Agreement; (ii) cancel or reduce the Capital Commitment of any of its equity
holders or any Investor under the Operating Agreement other than with the
consent of Secured Parties as required by the Credit Agreement; or (iii) excuse
any of its equity holders or any Investor from making any Capital Contribution
pursuant to the Operating Agreement if the proceeds from the related Capital
Call are to be applied to the Obligations.
 
3.           Remedies Upon Event of Default.
 
a. When an Event of Default exists, Administrative Agent, on behalf of Secured
 
Parties, shall have the following rights with respect to the Collateral:
 
 
i.
To sell the Collateral or any part thereof, upon giving at least ten (10) days'
prior notice to Borrower and Managing Member of the time and place of sale
(which notice Borrower, Managing Member and Administrative Agent agree is
commercially reasonable), for cash or upon credit or for future delivery,
Borrower and Managing Member hereby waive all rights, if any, to require
Administrative Agent to marshal the Collateral and any other security for the
Obligation, and at the option and in the complete discretion of Administrative
Agent, either:

 
A.           at public sale; or
 
B.           at private sale, in which event such notice shall also contain the
terms of the proposed sale, and Borrower and Managing Member shall have until
the time of such proposed sale in which to redeem the Collateral or to procure a
purchaser willing, ready and able to purchase the Collateral on terms more
favorable to Borrower, Managing Member, Secured Parties and the holders of the
Notes, and if such a purchaser is so procured, then Administrative Agent shall
sell the Collateral to the purchaser so procured; and
 
 
 

--------------------------------------------------------------------------------

 
 
ii.            To bid for and to acquire, unless prohibited by applicable law,
free from any redemption right, the Collateral, or any part thereof, and, if
Secured Parties are then the holders of the Obligations or any participation or
other interest therein, in lieu of paying cash therefor, Administrative Agent on
behalf of Secured Parties may make settlement for the selling price by crediting
the net selling price, if any, after deducting all costs and expenses of every
kind, upon the outstanding principal amount of the Obligations, in such order
and manner as Administrative Agent on behalf of Secured Parties, in its
discretion, may deem advisable. Administrative Agent for the benefit of Secured
Parties, upon so acquiring the Collateral, or any part thereof, shall be
entitled to hold or otherwise deal with or dispose of the same in any manner not
prohibited by applicable law; and
 
iii.            To enforce any other remedy available to Administrative Agent on
behalf of Secured Parties at law or in equity.
 
From time to time Administrative Agent may, but shall not be obligated to,
postpone the time and change the place of any proposed sale of any of the
Collateral for which notice has been given as provided above if, in the judgment
of Administrative Agent, such postponement or change is necessary or appropriate
in order that the provisions of this Security Agreement applicable to such sale
may be fulfilled or in order to obtain more favorable conditions under which
such sale may take place. Administrative Agent shall give Borrower and Managing
Member reasonable notice of such change.
 
b.           In case of any sale by Administrative Agent of any of the
Collateral on credit, which may be elected at the option and in the complete
discretion of Administrative Agent, on behalf of Secured Parties, the Collateral
so sold may be retained by Administrative Agent for the benefit of Secured
Parties until the selling price is paid by the purchaser, but neither
Administrative Agent nor Secured Parties shall incur any liability in case of
failure of the purchaser to take up and pay for the Collateral so sold. In case
of any such failure, such Collateral so sold may be again similarly sold. After
deducting all costs or expenses of every kind (including, without limitation,
the reasonable attorneys' fees and legal expenses incurred by Administrative
Agent or Secured Parties, or both), Administrative Agent shall apply the residue
of the proceeds of any sale or sales, if any, to pay the principal of and
interest upon the Obligations in such order and manner as Administrative Agent
in its discretion may deem advisable. The excess, if any, shall be paid to
Borrower. Neither Administrative Agent Secured Parties shall incur any liability
as a result of the sale of the Collateral at any private sale or sales.
 
c.           Subject to Section 14.19 of the Credit Agreement, Administrative
Agent and Secured Parties shall have all rights, remedies and recourse granted
in the Credit Agreement, the Notes, the Loan Documents and any other instrument
executed to provide security for or in connection with the payment and
performance of the Obligations or existing at common law or equity (including
specifically those granted by the Uniform Commercial Code, as adopted in New
York and any other state which governs the creation or perfection (and the
effect thereof) of any security interest in the Collateral), and such rights and
remedies: (i) shall be cumulative and concurrent; (ii) may be pursued
separately, successively or concurrently against Borrower and Managing Member
and any other party obligated under the Obligations, or against the Collateral,
or any of such Collateral, or any other security for the Obligations, or any of
them, at the sole discretion of Administrative Agent, on behalf of the Secured
Parties; (iii) may be exercised as often as occasion therefor shall arise, it
being agreed by Borrower and Managing Member that the exercise or failure to
exercise any of same shall in no event be construed as a waiver or release
thereof or of any other right, remedy or recourse; and (iv) are intended to be
and shall be, non-exclusive.
 
 
 

--------------------------------------------------------------------------------

 
 
d.           Notwithstanding a foreclosure upon any of the Collateral or
exercise of any other remedy by Administrative Agent on behalf of Secured
Parties in connection with an Event of Default: (i) neither Borrower nor
Managing Member shall be subrogated thereby to any rights of Administrative
Agent for the benefit of Secured Parties against the Collateral or any other
security for the Obligations, or Borrower or Managing Member or any property of
Borrower or Managing Member; (ii) nor shall Borrower or Managing Member be
deemed to be the owner of any interest in the Obligations; (iii) nor shall
Borrower or Managing Member exercise any rights or remedies with respect to
Borrower or Managing Member or the Collateral or any other security for the
Obligations or any of them or the property of Borrower or Managing Member until
the Obligations have been paid to Administrative Agent for the benefit of the
Secured Parties and are fully and indefeasibly performed and discharged.
 
e.           All recitals in any instrument of assignment or any other
instrument executed by Administrative Agent for the benefit of Secured Parties
or by Secured Parties incident to the sale, transfer, assignment or other
disposition or utilization of the Collateral or any part thereof hereunder shall
be full proof of the matters stated therein and no other proof shall be required
to establish full legal propriety of the sale or other action taken by
Administrative Agent for the benefit of Secured Parties or by Secured Parties or
of any fact, condition or thing incident thereto, and all prerequisites of such
sale or other action shall be presumed conclusively to have been performed or to
have occurred.
 
4. Notices. Any notice, demand, request or other communication which any party
hereto may be required or may desire to give hereunder shall be in writing
(except where telephonic instructions or notices are expressly authorized herein
to be given) and shall be deemed to be effective (a) if by hand delivery, telex,
telecopy or other facsimile transmission, on the day and at the time on which
delivered to such party at the address, telex or telecopier numbers specified
below; (b) if by mail, on the day which it is received after being deposited,
postage prepaid, in the United States registered or certified mail, return
receipt requested, addressed to such party at the address specified below; (c)
if by Federal Express or other reputable express mail service, on the next
Business Day following the delivery to such express mail service for next
Business Day delivery, addressed to such party at the address set forth below;
or (d) if by telephone on the day and at the time reciprocal communication
(i.e., direct communication between two or more persons, which shall not include
voice mail messages) with one of the individuals named below occurs during a
call to the telephone numbers indicated for such party below:
 
 
 

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If to Borrower or Managing Member:
c/o Acadia Realty Trust
1311 Mamaroneck Avenue, Suite 260
White Plains, New York 10605
Attention: Robert Masters, Esq.
 
If to Administrative Agent:
 
Bank of America, N.A. 214 North Tryon Street NC 1-027-19-01
 
Attention:                       Dan Hattendorf
Telephone:                     (704) 388-3113
Telecopy:                       (704) 388-9211
 
With a copy to:
Bank of America, N.A.
214 North Tryon Street, 19th Floor
NC 1-027-19-01
Charlotte, NC 28255
Attention:                       Brian S. Williams
Telecopy:                       (704) 968-1215
Telephone:                     (704) 683-4747
Email:                              Brian.S.Williams@bankofamerica.com
 
 
Any notice required hereunder shall be deemed commercially reasonable if given
at least ten (10) days prior to the event giving rise to the requirement of such
notice, including but not limited to, notices of a private or public sale.
 
5.                      Appointment of Successor Administrative Agent.
 
Reference is hereby made to Section 13.9 of the Credit Agreement for the terms
and conditions upon which a successor Administrative Agent hereunder may be
appointed. Wherever the words "Administrative Agent" are used herein, the same
shall mean the Administrative Agent named in the first paragraph of this
Security Agreement or the successor Administrative Agent at the time in
question.
 
6.                      Binding Effect; Miscellaneous.
 
a.            This Security Agreement shall be binding upon and inure to the
benefit of and be enforceable by the undersigned and their respective successors
and assigns.
 
 
 

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b.            The headings to the various paragraphs of this Security Agreement
shall have been inserted for convenient reference only and shall not modify,
define, limit or expand the expressed provisions of this Security Agreement.
This Security Agreement may be executed in any number of counterparts, each of
which shall be an original, and such counterparts shall together constitute but
one and the same instrument.
 
c.            No delay or omission on the part of Administrative Agent or the
Secured Parties in exercising any right hereunder shall operate as a waiver of
any such right or any other right. A waiver on any one or more occasions shall
not be construed as a bar to or waiver of any right or remedy on any future
occasion.
 
d.            Pursuant to Section 5-1401 of the New York General Obligations
Law, the substantive laws of the State of New York, without regard to the choice
of law principals that might otherwise apply, and the applicable federal laws of
the United States of America, shall govern the validity, construction,
enforcement and interpretation of this Security Agreement.
 
e.            Any suit, action or proceeding against Borrower or Managing Member
with respect to this Security Agreement or any judgment entered by any court in
respect thereof, may be brought in the courts of the State of New York, or in
the United States Courts located in the Borough of Manhattan in New York City,
pursuant to Section 5-1402 of the New York General Obligations Law, as the
Administrative Agent on behalf of the Secured Parties in its sole discretion may
elect and Borrower and Managing Member each hereby submits to the non-exclusive
jurisdiction of such courts for the purpose of any such suit, action or
proceeding. Borrower and Managing Member each hereby irrevocably consents to the
service of process in any suit, action or proceeding in said court by the
mailing thereof by the Administrative Agent on behalf of the Secured Party by
registered or certified mail, postage prepaid, to Borrower's address set forth
in Section 4 hereof. Borrower and Managing Member each hereby irrevocably waives
any objections which it may now or hereafter have to the laying of venue of any
suit, action or proceeding arising out of or relating to this Security Agreement
brought in the courts located in the State of New York, Borough of Manhattan in
New York City, and each hereby further irrevocably waives any claim that any
such suit, action or proceeding brought in any such court has been brought in an
inconvenient forum. BORROWER AND MANAGING MEMBER EACH HEREBY WAIVES TRIAL BY
JURY IN ANY SUIT, ACTION OR PROCEEDING BROUGHT IN CONNECTION WITH THIS SECURITY
AGREEMENT, WHICH WAIVER IS INFORMED AND VOLUNTARY.
 
f.            The remedies given to Administrative Agent on behalf of the
Secured Parties hereunder are cumulative and in addition to any and all other
rights which Administrative Agent on behalf of a Secured Party or the Secured
Parties may have against Borrower or Managing Member or any other person or
firm, at law or in equity, including exoneration and subrogation, or by virtue
of any other agreement.
 
g.            This Security Agreement and the provisions set forth herein shall
continue until the full, final and complete satisfaction of the Obligations, and
Administrative Agent's and Secured Parties' rights hereunder shall not be
released, diminished, impaired, reduced or adversely affected by: (i) the
renewal, extension, modification, amendment or alteration of the Credit
Agreement or any other Loan Document or any related document or instrument; (ii)
any adjustment, indulgence, forbearance or compromise that might be granted or
given by Administrative Agent or the Secured Parties to any primary or secondary
obligor or in connection with any security for the Obligations; (iii) any full
or partial release of any of the foregoing; or (iv) notice of any of the
foregoing.
 
 
 

--------------------------------------------------------------------------------

 
 
h.           Neither Administrative Agent nor Secured Parties has assumed, and
nothing contained herein shall be declared to have imposed upon Administrative
Agent or the Secured Parties, any of Borrower's duties or obligations or
Managing Member's duties or obligations as a member of Borrower, except that
Administrative Agent and the Secured Parties shall be bound by the provisions of
the Operating Agreement in exercising rights or remedies thereunder assigned to
Administrative Agent hereunder.
 
i.           Notwithstanding anything to the contrary herein, the obligations of
Managing Member hereunder are subject to the nonrecourse provisions of Section
14.19 of the Credit Agreement.
 
J. On the full, final, and complete satisfaction of the Obligations, this
Security Agreement shall be of no further force or effect. Thereafter, upon
request, Administrative Agent, on behalf of the Secured Parties, shall
reasonably provide Borrower and Managing Member, at their sole expense, a
written release of their respective obligations hereunder and of the Collateral.
 
Remainder of Page Intentionally Left Blank.
Signature Page Follows.
 
 
 

--------------------------------------------------------------------------------

 
 
EXECUTED on the date first above written.
 

 
BORROWER:
     
ACADIA STRATEGIC OPPORTUNITY FUND III
 
LLC, a Delaware limited liability company
         
By: /s/ Robert Masters
 
Name: Robert Masters
 
Title: Senior Vice President

 

 
MANAGING MEMBER:
     
ACADIA REALTY ACQUISITION III LLC,
 
a Delaware limited liability company
         
By: /s/ Robert Masters
 
Name: Robert Masters
 
Title: Senior Vice President

 
 
Exhibit E

--------------------------------------------------------------------------------

 
 
EXHIBIT F
to Revolving Credit Agreement
by and among
Acadia Strategic Opportunity Fund III LLC, as Borrower,
Acadia Realty Acquisition III LLC, as Managing Member,
Acadia Realty Limited Partnership, as Guarantor,
Acadia Investors III, Inc., as Pledgor,
Bank of America, N.A., as Administrative Agent,
Banc of America Securities LLC, as Sole Lead Arranger and Sole Book Manager,
YC SUSI Trust, as Conduit Lender,
Bank of America, N.A., as an Administrator, Alternate Lender and Managing Agent,
and
the other Conduit Lenders, Administrators, Alternate Lenders and Managing Agents
from
time to time party thereto
 
ACCOUNT ASSIGNMENT
 
Dated as of October 10, 2007
 
 
For value received, ACADIA STRATEGIC OPPORTUNITY FUND III LLC, a Delaware
limited liability company ("Assignor"), hereby transfers and pledges to BANK OF
AMERICA, N.A., as Administrative Agent, on behalf of the Secured Parties, under
that certain Revolving Credit Agreement (as amended, modified, supplemented, or
restated from time to time, the "Credit Agreement"; capitalized terms used but
not defined herein shall have the meanings assigned to such terms in the Credit
Agreement), dated as of October 10, 2007, by and among Assignor, Acadia Realty
Acquisition III LLC, a Delaware limited liability company, as Managing Member,
Acadia Realty Limited Partnership, a Delaware limited partnership, as Guarantor,
Acadia Investors III, Inc., a Maryland corporation, as Pledgor, Bank of America,
N.A., as administrative agent (in such capacity, the "Administrative Agent"),
Banc of America Securities LLC, as Sole Lead Arranger and Sole Book Manager, YC
SUSI Trust, as Conduit Lender, Bank of America, N.A., as an Administrator,
Alternate Lender and Managing Agent and the other Conduit Lenders,
Administrators, Alternate Lenders and Managing Agents from time to time party
thereto, and grants to Administrative Agent, for the benefit of each Secured
Party, a common law lien, claim, encumbrance upon and security interest in
deposit account no. 1233060441 at Bank of America, N.A. ("Depository"), with
reference to "Acadia Strategic Opportunity Fund III LLC Collateral Account" and
any extensions or renewals thereof, if the account is one which may be extended
or renewed, and any successor or substitute accounts (such account or accounts
and any extensions or renewals being hereinafter called the "Collateral
Account", together with all of Assignor's right, title, and interest (whether
now existing or hereafter created or arising) in and to the Collateral Account,
all sums now or at any time hereafter on deposit therein, credited thereto, or
payable thereon, all proceeds and products thereof, and all instruments,
documents, certificates, and other writings evidencing the Collateral Account,
on the following terms and conditions:
 
1.
This assignment of the Collateral Account shall secure the payment and the
performance of the Obligations (as defined in the Credit Agreement).

 
 
Exhibit F

--------------------------------------------------------------------------------

 
 
2.          Assignor represents and warrants that:
 
 
a.
subject to Administrative Agent's and the Secured Parties' rights with respect
to the Collateral Account on the records of the Depository, Assignor is the sole
owner of the Collateral Account and has authority to execute and deliver this
assignment;

 
 
b.
except for any financing statement which may have been filed by the
Administrative Agent for the benefit of the Secured Parties, no financing
statement covering the Collateral Account, or any part thereof, has been filed
with any filing officer;

 
 
c.
except for the security agreement entered into in favor of the Administrative
Agent on behalf of the Secured Parties, no other assignment or security
agreement has been executed with respect to the Collateral Account; and

 
 
d.
the Collateral Account is not subject to any Liens or offsets of any Person
other than Administrative Agent, the Secured Parties and the Depository.

 
3.
 
So long as the Obligations or any part thereof remains unpaid, Assignor
covenants and agrees:

 
 
a.
(i) from time to time promptly to execute and deliver to Administrative Agent
all such other assignments, certificates, passbooks, and supplemental writings,
and do all other acts or things as Administrative Agent may reasonably request
in order to more fully evidence and perfect the security interest herein
created; and (ii) Administrative Agent may file such financing statements,
amendments thereto and continuations thereof as Administrative Agent may
reasonably deem appropriate in order to more fully evidence and perfect the
security interest herein created;

 
 
b.
promptly to furnish Administrative Agent with any information or writings which
Administrative Agent may reasonably request concerning the Collateral Account;

 
 
c.
promptly to notify Administrative Agent of any change in any fact or
circumstances warranted or represented by Assignor herein or in any other
writing furnished by Assignor to Administrative Agent in connection with the
Collateral Account or the Obligations;

 
 
d.
promptly to notify Administrative Agent of any claim, action, or proceeding
affecting title to the Collateral Account, or any part thereof, or the security
interest herein, and, at the request of Administrative Agent, appear in and
defend any such action or proceeding; and

 
 
e.
to pay to Administrative Agent the amount of any court costs and reasonable
attorney's fees assessed by a court and incurred by Administrative Agent
following any Event of Default or Special Default hereunder.

 
 
2

--------------------------------------------------------------------------------

 
 
 
4.
Assignor covenants and agrees that without the prior consent of Administrative
Agent Assignor will not:

 
 
a.
create any Lien in or upon, or otherwise encumber, or assign the Collateral
Account, or any part thereof, or permit the same to be or become subject to any
Lien, attachment, execution, sequestration, other legal or equitable process, or
any encumbrance of any kind or character, except the Lien herein created and any
offset rights inuring to the benefit of Depository, but only to the extent same
are subordinated to Secured Parties' Liens; or

 
 
b.
request, make or allow to be made any withdrawals from the Collateral Account
except as provided hereunder or in Section 5.2 of the Credit Agreement.

 
Should any funds payable with respect to the Collateral Account be received by
Assignor, they shall immediately upon such receipt become subject to the Lien
hereof and while in the hands of Assignor be segregated from all other funds of
Assignor and be held in trust for Secured Parties. Except as otherwise provided
in the Credit Agreement, Assignor shall have absolutely no dominion or control
over such funds except to immediately deposit them into the Collateral Account.
Assignor acknowledges and agrees that Depository shall comply with instructions
originated in writing by Administrative Agent in accordance with the terms
hereof and of the Credit Agreement directing the disposition of funds in the
Collateral Account without further consent of Assignor.
 
 
5.
Administrative Agent's or the Secured Parties' rights hereunder shall not be
released, diminished, impaired, reduced or adversely affected by:

 
 
a.
any adjustment, indulgence, forbearance or compromise that might be granted or
given by Administrative Agent, on behalf of the Secured Parties, or the Secured
Parties to any primary or secondary obligor or in connection with any security
for the Obligations;

 
b.           any full or partial release of any security for the Obligations;
 
 
c.
any other action taken or omitted to be taken by Administrative Agent, on behalf
of the Secured Parties, or the Secured Parties in connection with the
Obligations, whether or not such action or omission prejudices Assignor or
increases the likelihood that the Collateral Account will be applied to the
Obligations; or

 
d.           notice of any of the foregoing.
 
6. 
Administrative Agent, in its discretion, without in any manner impairing any
rights and powers of Secured Parties hereunder, may, at any time and from time
to time, without further consent of or notice to Assignor, and with or without
valuable consideration:

 
 
a.
renew or extend the maturity of or accept partial payments upon the Obligations
or any part thereof;

 
 
3

--------------------------------------------------------------------------------

 
 
 
b.
release any person primarily or secondarily liable in respect of the Obligations
or any security therefor;

 
 
c.
alter in any manner that the Secured Parties may elect the terms of any
instrument evidencing the Obligations or any part thereof either as to the
maturity thereof, rate of interest, method of payment, parties thereto or
otherwise;

 
 
d.
renew, extend or accept partial payments upon, release or permit substitutions
for or withdrawals of, any security (other than the Collateral Account) at any
time directly or indirectly, immediately or remotely, securing the payment of
the Obligations or any part thereof; and

 
 
e.
release or pay to Assignor, or any other person otherwise entitled thereto, any
amount paid or payable in respect of any such other direct or indirect security
for the Obligations, or any part thereof.

 
7.
Should any person other than Assignor have heretofore executed or hereafter
execute, in favor of the Secured Parties, any deed of trust, mortgage, or
security agreement, or have heretofore pledged or hereafter pledge any other
property to secure the payment of the Obligations, or any part thereof, the
exercise by the Secured Parties of any right or power conferred upon any of them
in any such instrument, or by any such pledge, shall be wholly discretionary
with each Secured Party, and the exercise or failure to exercise any such right
or power shall not impair or diminish the Secured Parties' rights, titles,
interest, Liens, and powers existing hereunder.

 
8.
The term "Event of Default," as used herein, means the existence of any "Event
of Default" described in the Credit Agreement.

 
9.
The term "Special Default," as used herein, means (a) the existence of any Event
of Default or (b) the failure by Assignor or any Qualified Borrower to pay when
due any monetary Obligations under the Credit Agreement, the Notes or any other
Loan Document, including, without limitation, any mandatory prepayment required
under Section 2.1(d) of the Credit Agreement or (c) the existence of a Potential
Default under Section 12.1(g) and Section 12.10) of the Credit Agreement.

 
 
10.
a. During the existence of an Event of Default, Administrative Agent, on behalf
of the Secured Parties, in addition to any other remedies it may have, may do
one or more of the following:

 
i.           declare the Obligations immediately due and payable;
 
 
ii.
demand payment and performance thereof from the funds in or credited to the
Collateral Account; and

 
 
iii.
withdraw funds from the Collateral Account and apply all or any portion of the
Collateral Account to the Obligations as described in paragraph 13 hereof.

 
 
4

--------------------------------------------------------------------------------

 
 
 
b.Assignor hereby authorizes Administrative Agent during the existence of an

 
 
Event of Default and so long as any part of the Obligations remain outstanding:

 
 
i.
to withdraw, collect, and receipt for any and all funds on deposit in or payable
on the Collateral Account, and apply such funds to payment of the Obligations;

 
 
ii.
on behalf of Assignor to receive, take, assign, deliver, accept, deposit, and
endorse the name of Assignor upon any checks, drafts, or other instruments
payable to Assignor evidencing payment on the Collateral Account;

 
 
iii.
to surrender or present for notation of withdrawal the passbook, certificate, or
other documents issued to Assignor in connection with the Collateral Account;
and

 
 
iv.
exercise any other rights or take any other actions specified herein or in the
Credit Agreement.

 
11.
Upon the occurrence of a Special Default, Administrative Agent, on behalf of the
Secured Parties, in addition to any other remedies it may have, may restrict or
prohibit withdrawals from the Collateral Account.

 
12.
Neither Administrative Agent nor any other Secured Party shall be liable for any
loss of interest on or any penalty or charge assessed against funds in, payable
on, or credited to the Collateral Account as a result of Administrative Agent,
or any Secured Party exercising any of its rights or remedies under, and in
accordance with, this assignment, except to the extent resulting from gross
negligence or willful misconduct.

 
13.
Administrative Agent shall be entitled to apply any and all funds received by it
hereunder toward payment and performance of the Obligations in such order and
manner as Administrative Agent, in its absolute discretion, may elect. If such
funds are not sufficient to pay and perform the Obligations in full, Assignor
shall remain liable for any deficiency, the liability of each person obligated
on the Obligations to be determined by Administrative Agent following its
receipt and crediting of such funds. Upon full and final payment of the
Obligations, the rights of Administrative Agent in and to the Collateral Account
hereunder will be deemed to be released and of no further force and effect.

 
14.
All rights, titles, interests, Liens, and remedies of Secured Parties hereunder
are cumulative of each other and of every other right, title, interest, Lien, or
remedy which the Secured Parties may otherwise have at law or in equity or under
any other contract or other writing for the enforcement of the security interest
herein or the collection of the Obligations, and the exercise of one or more
rights or remedies shall not prejudice or impair the concurrent or subsequent
exercise of other rights or remedies. Should Assignor have heretofore executed
or hereafter execute any other security agreement in favor of the Secured
Parties, the security interest therein created and all other rights,  powers,
and privileges vested in the Secured Parties by the terms thereof shall exist
concurrently with the security interest created herein.

 
 
5

--------------------------------------------------------------------------------

 
 
15.
Should any part of the Obligations be payable in installments, the acceptance by
Administrative Agent at any time and from time to time of part payment of the
aggregate amount of all installments then matured shall not be deemed to be a
waiver of the default then existing. No waiver by the Secured Parties of any
default shall be deemed to be a waiver of any other subsequent default, nor
shall any such waiver by the Secured Parties be deemed to be a continuing
waiver. No delay or omission by the Secured Parties in exercising any right or
power hereunder, or under any other writings executed by Assignor as security
for or in connection with the Obligations, shall impair any such right or power
or be construed as a waiver thereof or any acquiescence therein, nor shall any
single or partial exercise of any such right or power preclude other or further
exercise thereof, or the exercise of any other right or power of the Secured
Parties hereunder or under such other writings.

 
16.
No provision herein or in any promissory note, instrument, or any other loan
document evidencing the Obligations shall require the payment or permit the
collection of interest in excess of the maximum permitted by law. If any excess
of interest in such respect is provided for herein or in any such promissory
note, instrument, or any other loan document, the provisions of this paragraph
shall govern, and the Assignor shall not be obligated to pay the amount of such
interest to the extent that it is in excess of the amount permitted by law. The
intention of the parties being to conform strictly to the usury laws now in
force, all promissory notes, instruments, and other loan documents evidencing
the Obligations shall be held subject to reduction to the amount allowed under
said usury laws as now or hereafter construed by the courts having jurisdiction.

 
17.
(a) PURSUANT TO SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW, THE
SUBSTANTIVE LAWS OF THE STATE OF NEW YORK, EXCEPT TO THE EXTENT THE LAWS OF
ANOTHER JURISDICTION GOVERN THE CREATION, PERFECTION, VALIDITY, OR ENFORCEMENT
OF LIENS UNDER THIS ASSIGNMENT, AND THE APPLICABLE FEDERAL LAWS OF THE UNITED
STATES OF AMERICA, SHALL GOVERN THE VALIDITY, CONSTRUCTION, ENFORCEMENT AND
INTERPRETATION OF THIS ASSIGNMENT. (b) NOTWITHSTANDING THE FOREGOING, THE
PARTIES HERETO AGREE THAT THE STATE OF NEW YORK SHALL BE DEEMED TO BE THE
JURISDICTION OF THE DEPOSITORY FOR PURPOSES OF ANY MATTER IN RESPECT HEREOF
RELATING TO OR ARISING UNDER SECTION 9-304 OF THE UNIFORM COMMERCIAL CODE AS IN
EFFECT FROM TIME TO TIME IN THE STATE OF NEW YORK. (c) ASSIGNOR AND BANK OF
AMERICA EXPRESSLY AGREE THAT THE TERMS AND CONDITIONS OF ANY AGREEMENT
ESTABLISHING THE COLLATERAL ACCOUNT OR OTHERWISE GOVERNING THE COLLATERAL
ACCOUNT SHALL, TO THE EXTENT INCONSISTENT HEREWITH (INCLUDING IN RESPECT OF THE
FOREGOING CLAUSE (b)), BE SUBORDINATE TO AND CONTROLLED BY THIS ASSIGNMENT OF
COLLATERAL ACCOUNT.

 
 
6

--------------------------------------------------------------------------------

 
 
18.
Any suit, action or proceeding against Assignor with respect to this Assignment
or any judgment entered by any court in respect thereof, may be brought in the
courts of the State of New York, or in the United States Courts located in the
Borough of Manhattan in New York City, pursuant to Section 5-1402 of the New
York General Obligations Law, as Administrative Agent in its sole discretion may
elect, and Assignor hereby submits to the non-exclusive jurisdiction of such
courts for the purpose of any such suit, action or proceeding. Assignor hereby
irrevocably consents to the service of process in any suit, action or proceeding
in said court by the mailing thereof by Administrative Agent by registered or
certified mail, postage prepaid, to Assignor's address set forth following its
signature hereto. Assignor hereby irrevocably waives any objections which it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Assignment brought in the courts located in
the State of New York, Borough of Manhattan in New York City, and hereby further
irrevocably waives any claim that any such suit, action or proceeding brought in
any such court has been brought in an inconvenient forum. ASSIGNOR HEREBY WAIVES
TRIAL BY JURY IN ANY SUIT, ACTION OR PROCEEDING BROUGHT IN CONNECTION WITH THIS
ASSIGNMENT, WHICH WAIVER IS INFORMED AND VOLUNTARY.

 
 
19.
This assignment shall be binding on and inure to the benefit of Assignor and
Administrative Agent and their respective successors and permitted assigns.

 
20.
This Assignment and the provisions set forth herein shall continue until the
full, final, and complete satisfaction of the Obligations, and the
Administrative Agent's and the Secured Parties' rights hereunder shall not be
released, diminished, impaired, reduced or adversely affected by: (i) the
renewal, extension, modification, amendment or alteration of the Credit
Agreement or any other Loan Document or any related document or instrument; (ii)
any adjustment, indulgence, forbearance or compromise that might be granted or
given by Administrative Agent or the Secured Parties to any primary or secondary
obligor or in connection with any security for the Obligations; (iii) any fu11
or partial release of any of the foregoing; or (iv) notice of any of the
foregoing.

 
21.
On the full, final, and complete satisfaction of the Obligations, this
Assignment shall be of no further force or effect. Thereafter, upon request,
Administrative Agent, on behalf of the Secured Parties, shall reasonably provide
Assignor, at Assignor's sole expense, a written release of Assignor's
obligations hereunder and an assignment of the Collateral Account to Assignor.

 
 
22.
In the event of a conflict or inconsistency between any provision of this
agreement with any provision of the Credit Agreement, the Credit Agreement will
control.

 
REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.
SIGNATURE PAGES FOLLOW.
 
 
7

--------------------------------------------------------------------------------

 

 
ASSIGNOR ACKNOWLEDGES RECEIPT OF A COPY OF THIS ASSIGNMENT. Executed by Assignor
on the date first above written.
 

 
ACADIA STRATEGIC OPPORTUNITY FUND III
 
LLC, a Delaware limited liability company
         
By: /s/ Robert Masters
 
Name: Robert Masters
 
Title: Senior Vice President

 

  BANK OF AMERICA, N.A.      
By:
 
Name:
 
Title:

 
 
Account Assignment

--------------------------------------------------------------------------------

 
 
DEPOSITORY ACKNOWLEDGMENT
AND AGREEMENT
 
The undersigned depository, Bank of America, N.A. (the "Depository"),
acknowledges that Assignor has assigned the Collateral Account as described in
the foregoing Assignment of Collateral Account (the "Assignment", with
capitalized terms not defined herein being used herein as therein defined). The
records of the Depository have been marked to show the Assignment. The
Depository hereby acknowledges that the Collateral Account, as described in the
Assignment, has been validly created by the Depository in favor of Assignor.
 
Notwithstanding any other provision to the contrary in any other agreement
between the Depository and the Assignor and/or the Administrative Agent, the
Depository agrees that if at any time it shall receive any instructions
directing deposition of funds in the Account from the Administrative Agent, the
Depository shall comply with such instructions without further consent by the
Assignor. In the event the Assignor is permitted to give instructions with
respect to the Account, notwithstanding anything to the contrary contained in
any other agreement between the Depository and the Assignor and/or the
Administrative Agent, if at the time the Depository shall receive conflicting
instructions from the Assignor and the Administrative Agent, the Depository
shall follow the instructions of the Administrative Agent and not the Assignor.
 
The Depository hereby subordinates any and all rights of set-off and all other
rights and Liens of the Depository against the Collateral Account to the rights,
security interests, and Liens under the Assignment, and agrees that, so long as
the Obligation remains outstanding, Depository shall not, without the prior
written consent of the Administrative Agent, which consent may be withheld by
the Administrative Agent in its sole and absolute discretion, with or without
cause, exercise or enforce any rights or remedies with respect to the Collateral
Account except as required to preserve its rights in the case of bankruptcy,
reorganization or insolvency proceedings with respect to the Assignor, and
except that the Depository may charge the Collateral Account for any charges,
fees and expenses for which Assignor is responsible and which relate to the
transactions contemplated by the Assignment or the Credit Agreement referred to
therein.
 
The Depository may rely upon and shall be fully protected, indemnified and held
harmless in acting or refraining from acting upon any notice (including, without
limitation, electronically confirmed facsimiles of such notice) received from
the Assignee or the Assignor (including, without limitation, any notice of an
Event of Default or Special Default as defined in the Assignment or the Credit
Agreement referred to in the Assignment) and believed by it to be genuine and to
have been signed or presented by the proper party or parties.
 
The Depository further agrees to provide Assignee with copies of all notices and
records sent to Assignor relating to the Collateral Account, and will deliver to
Assignee all monthly (or other periodic) statements of the Collateral Account
and respond to inquiries by Assignee about any deposits, withdrawals or any
other matters relating to the Collateral Account, to the same extent Depository
makes such information available to the Collateral Account holder, and Assignor
hereby acknowledges and consents to such agreement by Depository.
 
 
 

--------------------------------------------------------------------------------

 

 
This Depository Acknowledgment shall be effective as of the date of the
Assignment.
 

  BANK OF AMERICA, N.A.      
By:
 
Name:
 
Title:

 
 
Depository Acknowledgement and Agreement

--------------------------------------------------------------------------------

 
 
Acknowledged and Agreed:
 

 
ACADIA STRATEGIC OPPORTUNITY FUND III
 
LLC, a Delaware limited liability company
         
By: /s/ Robert Masters
 
Name: Robert Masters
 
Title: Senior Vice President

 
1
 
Exhibit F

--------------------------------------------------------------------------------

 
 
EXHIBIT G
to Revolving Credit Agreement
by and among
Acadia Strategic Opportunity Fund III LLC, as Borrower,
Acadia Realty Acquisition III LLC, as Managing Member,
Acadia Realty Limited Partnership, as Guarantor,
Acadia Investors III, Inc., as Pledgor,
Bank of America, N.A., as Administrative Agent,
Banc of America Securities LLC, as Sole Lead Arranger and Sole Book Manager,
YC SUSI Trust, as Conduit Lender,
Bank of America, N.A., as an Administrator, Alternate Lender and Managing Agent,
and
the other Conduit Lenders, Administrators, Alternate Lenders and Managing Agents
from
time to time party thereto
 
FACILITY INCREASE REQUEST
DATE]
 
Bank of America, N.A., as Administrative Agent
NC 1-027-19-01
214 North Tryon Street
Charlotte, North Carolina 28255
Attention: Dan Hattendorf
 
Telephone: (704) 388-3113
Facsimile: (704) 388-9211
 
with a copy to:
 
Bank of America, N.A.
NC1-027-19-01
214 North Tryon Street, 19th Floor
Charlotte, NC 28255
Attention:                      Brian S. Williams
Telephone:                      (704) 683-4747
Telecopy:                      (704) 968-1215
Email:                             Brian.S.Williwns@bankofamerica.com
 
and:
 
Michael C. Mascia
Mayer Brown LLP
214 N. Tryon Street, Suite 3800
Charlotte, N.C. 28203
Phone: (704) 444-3651
Fax: (704) 377-2033

 
Exhibit G

--------------------------------------------------------------------------------

 
 
Ladies and Gentlemen:
 
This Facility Increase Request (this "Facility Increase Request") is executed
and delivered by Acadia Strategic Opportunity Fund III LLC (the `Borrower") to
Bank of America, N.A., as administrative agent ("Administrative Agent"),
pursuant to that certain Revolving Credit Agreement (as amended, modified,
supplemented, or restated from time to time, the "Credit Agreement") dated as of
October 10, 2007, entered into by and among Borrower, Acadia Realty Acquisition
III LLC, a Delaware limited liability company, as Managing Member, Acadia Realty
Limited Partnership, a Delaware limited partnership, as Guarantor, Acadia
Investors III, Inc., a Maryland corporation, as Pledgor, Administrative Agent,
Banc of America Securities LLC, as Sole Lead Arranger and Sole Book Manager, YC
SUSI Trust, as Conduit Lender, Bank of America, N.A., as an Administrator,
Alternate Lender and Managing Agent and the other Conduit Lenders,
Administrators, Alternate Lenders and Managing Agents from time to time party
thereto. Capitalized terms not defined herein shall have the meanings assigned
to such terms in the Credit Agreement.
 
Borrower hereby requests an increase in the Facility Amount pursuant to Section
2.12(a) of the Credit Agreement to $_________ 2 (the "Facility Increase"), such
Facility Increase to be effective on _______[DATE] (must be at least 3 Business
Days after date of Request).
 
In connection with the Facility Increase requested hereby, Borrower hereby
represents, warrants, and certifies to Administrative Agent for the benefit of
Lenders that:
 
(a) No Event of Default or Potential Default under the Credit Agreement has
 
occurred and is continuing or would result from the Facility Increase;
 
(c)       After giving effect to the Facility Increase, the aggregate amount of
the Alternate Lenders' Commitments will not exceed the Maximum Commitment; and
 
(d)       Attached hereto as Schedule I is a calculation of the Borrowing Base,
true and correct as of the date hereof.
 
In the event that between the date hereof and the date of the Facility Increase,
any event should occur which could reasonably be expected to have a Material
Adverse Effect, Borrower shall promptly notify the Administrative Agent.
 
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.
SIGNATURE PAGE FOLLOWS.]
 
 

--------------------------------------------------------------------------------

2           Amount of Facility Increase shall be in a minimum amount of
$50,000,000.
 
 
Exhibit G

--------------------------------------------------------------------------------

 
 
This Facility Increase Request is executed as of the date first written above.
The undersigned hereby certifies each and every matter contained herein to be
true and correct.
 

 
BORROWER:
     
ACADIA STRATEGIC OPPORTUNITY FUND III
 
LLC, a Delaware limited liability company
         
By: /s/ Robert Masters
 
Name: Robert Masters
 
Title: Senior Vice President

 

 
Acknowledged and Agreed To:
 
GUARANTOR:
 
ACADIA REALTY LIMITED PARTNERSHIP, a Delaware limited partnership
 

 
ACADIA REALTY TRUST,
 
its General Partner
        By: 
/s/ Robert Masters
 
Name: Robert Masters
 
Title: Senior Vice President

 
4
 
Exhibit G

--------------------------------------------------------------------------------

 
 
EXHIBIT H
to Revolving Credit Agreement
by and among
Acadia Strategic Opportunity Fund III LLC, as Borrower,
Acadia Realty Acquisition III LLC, as Managing Member,
Acadia Realty Limited Partnership, as Guarantor,
Acadia Investors III, Inc., as Pledgor,
Bank of America, N.A., as Administrative Agent,
Banc of America Securities LLC, as Sole Lead Arranger and Sole Book Manager,
YC SUSI Trust, as Conduit Lender,
Bank of America, N.A., as an Administrator, Alternate Lender and Managing Agent,
and
the other Conduit Lenders, Administrators, Alternate Lenders and Managing Agents
from
time to time party thereto
 
FORM OF BORROWING BASE CERTIFICATE
 
Bank of America, N.A.
 
214 North Tryon Street, 19th Floor NC 1-027-19-01
Charlotte, NC 28255
Attention:                      Brian S. Williams
Telecopy:                      (704) 968-1215
Telephone:                      (704) 683-4747
 
ADMINISTRATIVE AGENT: Bank of America, N.A.
 
BORROWER:                                                     Acadia Strategic
Opportunity Fund III LLC
 
The Borrower and Managing Member each hereby represent and warrant to the
Administrative Agent that the Borrowing Base Certificate attached hereto as
Schedule I is a true, correct and complete calculation of the Borrowing Base as
of [DATE]. Capitalized terms used herein and not otherwise defined shall have
the meaning assigned thereto in the Credit Agreement.

 
Exhibit H

--------------------------------------------------------------------------------

 
 

 
BORROWER:
     
ACADIA STRATEGIC OPPORTUNITY FUND III
 
LLC, a Delaware limited liability company
         
By: /s/ Robert Masters
 
Name: Robert Masters
 
Title: Senior Vice President

 

 
MANAGING MEMBER:
     
ACADIA REALTY ACQUISITION III LLC,
 
a Delaware limited liability company
         
By: /s/ Robert Masters
 
Name: Robert Masters
 
Title: Senior Vice President

 
2
 
Exhibit H

--------------------------------------------------------------------------------

 
 
Schedule I
 
(Calculation of the Borrowing Base)
 
[See Attached]
 
 
Exhibit H

--------------------------------------------------------------------------------

 
 
EXHIBIT I
to Revolving Credit Agreement
by and among
Acadia Strategic Opportunity Fund III LLC, as Borrower,
Acadia Realty Acquisition III LLC, as Managing Member,
Acadia Realty Limited Partnership, as Guarantor,
Acadia Investors III, Inc., as Pledgor,
Bank of America, N.A., as Administrative Agent,
Banc of America Securities LLC, as Sole Lead Arranger and Sole Book Manager,
YC SUSI Trust, as Conduit Lender,
Bank of America, N.A., as an Administrator, Alternate Lender and Managing Agent,
and
the other Conduit Lenders, Administrators, Alternate Lenders and Managing Agents
from
time to time party thereto
 
FORM OF INVESTOR LETTER
 
[See Attached.]
 
 
Exhibit I

--------------------------------------------------------------------------------

 
 
INVESTOR LETTER
 
[Investor Letter - Investor to copy/print on letterhead]
 
[Leave date blank - Borrower's counsel should obtain
authorization to complete date
 upon closing]
_________,2007
 
Bank of America, N.A., as
Administrative Agent
NC 1-027-19-01
214 North Tryon Street Charlotte, NC 28255
Attention: Brant Murdock
 
Re: 
Revolving Credit Facility (the "Credit Facility") established pursuant to that
certain Revolving Credit Agreement (as the same may be modified, amended, or
restated from time to time, the "Credit Agreement"), entered into or to be
entered into by and among Acadia Strategic Opportunity Fund III, LLC
("Borrower"), Acadia Realty Acquisition III, LLC ("Managing Member"), Acadia
Realty Limited Partnership, as Guarantor, Acadia Investors III, Inc.
("Investor"), Bank of America, N.A., as Administrative Agent, YC SUSI Trust, as
Conduit Lender, Bank of America, N.A., as an Administrator, Alternate Lender and
Managing Agent and the other Conduit Lenders, Administrators, Alternate Lenders
and Managing Agents from time to time party thereto (each, a "Lender").

 
Ladies and Gentlemen:
 
In order to induce Lenders to provide the Credit Facility to Borrower, the
undersigned hereby acknowledges and agrees as follows:
 
We have entered into that certain Stockholders Agreement by and among Investor,
Yale University, The Vanderbilt University, Carnegie Corporation of New York,
Gloster III, LLC, The Board of Trustees of the Leland Stanford Junior
University, The William and Flora Hewlett Foundation, The Trustees of the
University of Pennsylvania, The Regents of the University of Michigan, Gordon E.
and Betty I. Moore Foundation, Morris Ventures, Makena Capital Holdings Prime,
L.P, Clarendon Investment Partners II, LP and The Owen Family Trust, dated as of
May 15, 2007 (as the same may be further modified, amended, or restated from
time to time, the "Stockholders Agreement"; all capitalized terms used and not
otherwise defined herein shall have the meanings ascribed thereto in the
Stockholders Agreement) pursuant to which we have (i) purchased shares of stock
in Investor, which is a member in Borrower and (ii) committed to make cash
contributions of capital ("Capital Contributions") to Investor on the terms and
subject to the conditions set forth in the Stockholders Agreement in the
aggregate amount of $[ ] (our "Capital Commitment"), which Capital Contributions
are to be contributed by Investor to Borrower pursuant to the terms of the
Operating Agreement.
 
 
 

--------------------------------------------------------------------------------

 
 
As of the date hereof, $[______________] of our Capital Commitment has been
called, $____________, of our Capital Commitment remains to be drawn upon the
delivery of one or more Drawdown Notices pursuant to and in accordance with the
Stockholders Agreement.
 
We hereby agree that we shall deliver to Administrative Agent from time to time
upon the request of Managing Member, Investor or Administrative Agent a
certificate setting forth the remaining amount of our Capital Commitment which
we are obligated to fund (the "Unfunded Capital Commitment").
 
We hereby acknowledge and agree that under the terms of and subject to the
conditions set forth in the Stockholders Agreement, we are and shall remain
unconditionally obligated to fund our Unfunded Capital Commitment required on
account of calls for Capital Contributions duly made in accordance with the
terms of the Stockholders Agreement (including, without limitation, subsequent
calls for Capital Contributions made in connection with a shortfall in funds
available to Borrower as a result of the failure of any other Stockholder or
Managing Member to advance funds with respect to a call for Capital
Contributions duly made). In addition, we hereby acknowledge and confirm to
Administrative Agent, Lenders, Managing Member and Investor that we will make
Capital Contributions to the extent of our Unfunded Capital Commitment, to be
applied to the repayment of outstanding obligations under the Credit Agreement,
whether such Capital Contributions are called by Managing Member, Investor or
Administrative Agent for such purpose on behalf of Managing Member and Investor
(whether or not any Person is then acting as Managing Member for Borrower or
Manager for Investor) without, defense, counterclaim or offset of any kind,
including without limitation any defense under Section 365 of the U.S.
Bankruptcy Code, all of which we hereby waive. Notwithstanding anything to the
contrary in the Stockholders Agreement or Operating Agreement, we hereby
acknowledge and agree that (i) our obligation to fund our Unfunded Capital
Commitment as and when requested by Administrative Agent is unconditional and
(ii) Administrative Agent shall not be required to state any specific purpose or
use of funds, deliver any supporting documentation whatsoever or comply with any
formalities when making a Drawdown on our Unfunded Capital Commitment, except
that such Drawdown must be made in writing.
 
We hereby (i) acknowledge that Borrower, Managing Member and Investor, pursuant
to the terms of the Stockholders Agreement and the Credit Agreement are making a
collateral assignment to Administrative Agent for the benefit of Lenders of (i)
our Capital Contributions; and the right to issue Drawdown Notices and call and
receive all payments of all or any portion of our Unfunded Capital Commitment
under the Stockholders Agreement to secure all loans and other extensions of
credit made under the Credit Facility and all other obligations of Borrower
under the Credit Agreement and the other an Documents (as defined in the Credit
Agreement), (ii) represent that as of the date hereof, (A) to the best of our
knowledge there is no default or circumstance which with the passage of time
and/or the giving of notice would constitute a default under the Operating
Agreement or the Stockholders Agreement, (B) the Stockholders Agreement has not
been modified or amended except for the amendment referred to above and is in
full force and effect and enforceable against the undersigned in accordance with
its terms and (C) we do not have any right of offset against, or reduction to,
our obligation to fund our Unfunded Capital Commitment, (iii) acknowledge that
for so long as the Credit Facility is in place we will not amend, modify,
supplement, cancel, terminate, reduce or suspend any of the provisions of the
Stockholders Agreement or the Operating Agreement relating to the Capital
Commitments, the making of Capital Contributions or the incurrence of
indebtedness or any other provisions that would adversely affect the rights of
Administrative Agent or Lenders without your prior written consent and (iv)
acknowledge that until otherwise instructed by Administrative Agent in writing,
all future Capital Contributions made by us under the Stockholders Agreement
will be made by wire transfer to the following account opened and maintained by
Borrower with the Administrative Agent (the "Collateral Account") which Borrower
has also pledged as security for the Obligations (as such term is defined in the
Credit Agreement):
 
 
2

--------------------------------------------------------------------------------

 
 
 
Bank:
Bank of America, N.A.
Account Number: 
1233060441
ABA Number:  026-009-593 
Reference:
Acadia Strategic Opportunity Fund III LLC Collateral   
Account
Contact Person:
Mr. Brant Murdock

 
[Add to Yale and Gloster acknowledgments: The language/side letter/guarantees
from the Acadia II transaction.]
 
We hereby acknowledge that for so long as the Credit Agreement is in effect, we
are obligated, under the terms and subject to the limitations and conditions set
forth in the Stockholders Agreement, to honor any Drawdown Notice delivered to
us in the name of the Administrative Agent on behalf of Lenders, without setoff,
counterclaim or defense by funding the applicable portion of our Capital
Commitment into the Collateral Account, provided such Drawdown Notice is
delivered for the purpose of paying due and payable obligations of the Borrower
to Lenders under the Credit Facility and states on its face that it is delivered
for such purpose.
 
We understand that Lenders and Administrative Agent will be relying upon the
statements and agreements made herein in connection with making the Credit
Facility available to Borrower and, accordingly hereby acknowledge that Capital
Contributions we make under the Stockholders Agreement will not satisfy our
obligation to fund our Capital Commitment unless such Capital Contributions are
paid into the above account (unless we are otherwise instructed by
Administrative Agent as described above). We hereby acknowledge that the terms
of the Credit Agreement and of each other Loan Document (as defined therein) can
be modified without further notice to us or our consent. In addition, we
understand that the Credit Agreement and this Investor Letter shall be for the
benefit of Administrative Agent, Lenders, and Lenders' successors and assigns,
and that this Investor Letter will remain in effect until we are notified
jointly by Administrative Agent and Managing Member that the Credit Facility has
been terminated.
 
 
3

--------------------------------------------------------------------------------

 
 
We also acknowledge and confirm that (a) we understand that Lenders have not
been involved in the organization of Investor or offering of Investor's equity
interests, or made any representation in connection therewith, (b) we are not
relying on Lenders in any way in connection with our investment in Investor and
(c) Lenders have no obligation to provide us with any financial, tax or other
information pertaining to Investor or any other Person.
 
For governmental entity Investors:
 
[We represent and warrant that: (i) we are subject to commercial law with
respect to our obligations under the Stockholders Agreement and this Investor
Letter; (ii) the making and performance of the Stockholders Agreement and this
Investor Letter constitute private and commercial acts rather than governmental
or public acts, and that neither we nor any of our properties or revenues has
any right of immunity from suit, court jurisdiction, execution of a judgment or
from any other legal process with respect to our obligations under the
Stockholders Agreement and this Investor Letter. To the extent that we may
hereafter be entitled, in any jurisdiction in which judicial proceedings may at
any time be commenced with respect to the Stockholders Agreement, or this
Investor Letter to claim any such immunity, and to the extent that in any such
jurisdiction there may be attributed to us such an immunity (whether or not
claimed), we hereby irrevocably agree not to claim and hereby irrevocably waive
such immunity to the fullest extent permitted by applicable law.]
 
For ERISA Investors:
 
[The undersigned signatory confirms that it is the fiduciary of the plans whose
assets are invested in Investor and it confirms that: (i) it made its own
determination that the Transaction (defined below) was made on terms that are no
less favorable to such plans than those that could be obtained in arm's-length
transactions with unrelated parties; (ii) the decision to invest in Investor and
to execute and deliver this Investor Letter (the "Transaction") was made by the
undersigned, and the undersigned is not included among, is independent of, and
is unaffiliated with, Lenders (including the Administrative Agent) and Investor
(as defined below); (iii) each plan on behalf of which we have invested in
Investor (or commingled funds of related plans): (A) has no less than
$100,000,000 of assets; and (B) not more than five percent (5%) of the assets of
each such plan (or commingled fund) have been invested in Investor; and (iv)
Lenders (including the Administrative Agent): (x) had no influence, authority,
or control over the Transaction, and (y) rendered no investment advice with
respect to the Transaction. For purposes of this paragraph, a fiduciary is "not
included among, is independent of, and unaffiliated with" a Lender (including
the Administrative Agent) and Investor, as applicable, if: (A) the fiduciary is
not, directly or indirectly, through one or more intermediaries, controlling,
controlled by, or under common control with such Lender or Investor; (B) the
fiduciary is not an officer, director, employee or relative of, or partner in,
such Lender or Investor; and (C) no officer, director, highly-compensated
employee, or shareholder of Investor, or any officer, director or
highly-compensated employee, or partner of a Lender, is also an officer,
director, highly-compensated employee, or partner of the fiduciary. If such
individual is a director of the Lender, he or she must abstain from
participation in, and not otherwise be involved in, the decision made by the
fiduciary to invest in Investor.]
 
 
4

--------------------------------------------------------------------------------

 
 
{or - where this Investor Letter is being signed by a custodian or someone other
than the fiduciary:}
 
[We confirm that [_______] is the fiduciary (the "Fiduciary") of the Investor
 
and that the Fiduciary has confirmed to the Investor that: (i) the Fiduciary
made its own determination that the Transaction (defined below) was made on
terms that are no less favorable to the Investor than those that could be
obtained in arm's-length transactions with unrelated parties; (ii) the Fiduciary
made the decision to invest in Investor and to execute and deliver this Investor
Letter (the "Transaction"), and the Fiduciary is not included among, is
independent of, and is unaffiliated with, Lenders (including the Administrative
Agent) and Investor (as defined below); (iii) each plan on behalf of which the
Investor has invested in Investor (or commingled funds of related plans): (A)
has no less than $100,000,000 of assets; and (B) not more than five percent (5%)
of the assets of each such plan (or commingled fund) have been invested in
Investor; and (iv) Lenders (including the Administrative Agent): (x) had no
influence, authority, or control over the Fiduciary's decision to invest in
Investor, and (y) rendered no investment advice with respect to the Investor's
investment in Investor. For purposes of this paragraph, a fiduciary is "not
included among, is independent of, and unaffiliated with" a Lender (including
the Administrative Agent) and Investor, as applicable, if: (A) the fiduciary is
not, directly or indirectly, through one or more intermediaries, controlling,
controlled by, or under common control with such Lender or Investor; (B) the
fiduciary is not an officer, director, employee or relative of, or partner in,
such Lender or Investor; and (C) no officer, director, highly-compensated
employee, or shareholder of Investor, or any officer, director or
highly-compensated employee, or partner of a Lender, is also an officer,
director, highly-compensated employee, or partner of the fiduciary. If such
individual is a director of the Lender, then he or she must abstain from
participation in, and not otherwise be involved in, the decision made by the
fiduciary to invest in Investor.]
 
For non-U.S. Investors:
 
[We acknowledge and agree that: (i) this Investor Letter shall be governed by
the laws of the State of New York; (ii) (x) any suit, action or proceeding
against us with respect to this Investor Letter may be brought in the courts of
the State of New York, or in the United States Courts located in the Borough of
Manhattan in New York City, in the Administrative Agent's sole discretion; and
(y) we hereby submit to the non-exclusive jurisdiction of such courts for the
purpose of any suit; (iii) service of all writs, process and summonses in any
such suit, action or proceeding brought in the State of New York may be brought
upon our process agent appointed below, and the Investor hereby irrevocably
appoints [Name] ______, [Address]________, Attention:______ , as our process
agent, as its true and lawful attorney-in-fact in the name, place and stead of
it to accept such service of any and all such writs, process and summonses; and
(iv) we hereby irrevocably waive: (x) any objection which we may have now or
hereafter have to the laying of venue of any suit, action or proceeding arising
out of or relating to this Investor Letter brought in the courts located in the
State of New York, Borough of Manhattan in New York City; and (y) any claim that
any such suit, action or proceeding brought in any such court has been brought
in an inconvenient forum.]
 
REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.
SIGNATURE PAGE FOLLOWS.
 
 
5

--------------------------------------------------------------------------------

 
 

 
[NAME ON INVESTOR]
         
By:
 
Name:
 
Title:
      Address:        [____________________]    [____________________] 

 
 
[_______] Investor Letter
Signature Page

--------------------------------------------------------------------------------

 
 
EXHIBIT J
 
[Reserved]
 
 
Exhibit J

--------------------------------------------------------------------------------

 
 
EXHIBIT K
to Revolving Credit Agreement
by and among
Acadia Strategic Opportunity Fund III LLC, as Borrower,
Acadia Realty Acquisition III LLC, as Managing Member,
Acadia Realty Limited Partnership, as Guarantor,
Acadia Investors III, Inc., as Pledgor,
Bank of America, N.A., as Administrative Agent,
Banc of America Securities LLC, as Sole Lead Arranger and Sole Book Manager,
YC SUSI Trust, as Conduit Lender,
Bank of America, N.A., as an Administrator, Alternate Lender and Managing Agent,
and
the other Conduit Lenders, Administrators, Alternate Lenders and Managing Agents
from
time to time party thereto
 
[RESERVED]
 
 
Exhibit K

--------------------------------------------------------------------------------

 
 
EXHIBIT L
to Revolving Credit Agreement
by and among
Acadia Strategic Opportunity Fund III LLC, as Borrower,
Acadia Realty Acquisition III LLC, as Managing Member,
Acadia Realty Limited Partnership, as Guarantor,
Acadia Investors III, Inc., as Pledgor,
Bank of America, N.A., as Administrative Agent,
Banc of America Securities LLC, as Sole Lead Arranger and Sole Book Manager,
YC SUSI Trust, as Conduit Lender,
Bank of America, N.A., as an Administrator, Alternate Lender and Managing Agent,
and
the other Conduit Lenders, Administrators, Alternate Lenders and Managing Agents
from
time to time party thereto
 
FORM OF CAPITAL CONTRIBUTIONS PLEDGE AGREEMENT
 
[See Attached]
 
 
Exhibit L

--------------------------------------------------------------------------------

 
 
EXHIBIT M
to Revolving Credit Agreement
by and among
Acadia Strategic Opportunity Fund III LLC, as Borrower,
Acadia Realty Acquisition III LLC, as Managing Member,
Acadia Realty Limited Partnership, as Guarantor,
Acadia Investors III, Inc., as Pledgor,
Bank of America, N.A., as Administrative Agent,
Banc of America Securities LLC, as Sole Lead Arranger and Sole Book Manager,
YC SUSI Trust, as Conduit Lender,
Bank of America, N.A., as an Administrator, Alternate Lender and Managing Agent,
and
the other Conduit Lenders, Administrators, Alternate Lenders and Managing Agents
from
time to time party thereto
 
FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT
 
This Assignment and Assumption (this "Assignment and Assumption") is dated as of
the Effective Date set forth below and is entered into by and between [ASSIGNOR]
(the "Assignor") and [ASSIGNEE] (the "Assignee"). Capitalized terms not defined
herein shall have the meanings assigned to such terms in the Credit Agreement
referred to below (as amended, modified, supplemented or restated from time to
time, the "Credit Agreement"), receipt of a copy of which is hereby acknowledged
by the Assignee. The Standard Terms and Conditions set forth in Annex 1 attached
hereto (the "Standard Terms and Conditions") are hereby agreed to and
incorporated herein by reference and made a part of this Assignment and
Assumption as if set forth herein in full.
 
For an agreed consideration, the Assignor hereby irrevocably sells and assigns
to the Assignee, and the Assignee hereby irrevocably purchases and assumes from
the Assignor, subject to and in accordance with the Standard Terms and
Conditions and the Credit Agreement, as of the Effective Date inserted by the
Administrative Agent as contemplated below: (a) all of the Assignor's rights and
obligations in its capacity as [Conduit Lender] [Alternate Lender] under the
Credit Agreement and any other documents or instruments delivered pursuant
thereto to the extent related to the amount and percentage interest identified
below of all of such outstanding rights and obligations of the Assignor under
the respective facilities identified below (including without limitation any
letters of credit or guarantees included in such facilities); and (b) to the
extent permitted to be assigned under applicable law, all claims, suits, causes
of action and any other right of the Assignor (in its capacity as a [Conduit
Lender] [Alternate Lender]) against any Person, whether known or unknown,
arising under or in connection with the Credit Agreement, any other documents or
instruments delivered pursuant thereto or the loan transactions governed thereby
or in any way based on or related to any of the foregoing, including, but not
limited to, contract claims, tort claims, malpractice claims, statutory claims
and all other claims at law or in equity related to the rights and obligations
sold and assigned pursuant to clause (a) above (the rights and obligations sold
and assigned pursuant to clauses (a) and (b) above being referred to herein
collectively as, the "Assigned Interest"). Such sale and assignment is without
recourse to the Assignor and, except as expressly provided in this Assignment
and Assumption, without representation or warranty by the Assignor.
 
 
Exhibit M

--------------------------------------------------------------------------------

 
 
1.                      Assignor:
 
2.                      Assignee:
                 [and Assignee is an Affiliate/Approved Fund of [identify
Lender] l
 
3.                      Borrower:    Acadia Strategic Opportunity Fund III LLC
 
4.                      Administrative Agent: Bank of America, N.A., as
Administrative Agent under the Credit Agreement
 
5.
Credit Agreement: The Revolving Credit Agreement dated as of October 10, 2007
among Acadia Strategic Opportunity Fund III LLC, Acadia Realty Acquisition III
LLC, Acadia Realty Limited Partnership, Acadia Investors III, Inc., the Lenders
and other Persons party thereto, and Bank of America, N.A., as Administrative
Agent

 
6.                      Assigned Interest:

 
ASSIGNOR
  [NAME OF ASSIGNOR]       
 
 
By:
 
Name: 
  Title: 

 
Facility Assigned
 
Aggregate
Amount of
Commitment for
all [Alternate
Lenders] [Conduit
Lenders]2
 
Amount of
Commitment
Assigned*
Amount of
Loans
Assigned*
 
Percentage Assigned
of Commitment/
Loans3
 
Revolving   Credit
Commitment
  $           $   %

 

 
[9.           Trade Date: ]4
 
 
 
Effective Date:_______ ______,20____    [TO BE INSERTED BY ADMINISTRATIVE AGENT
AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER N THE REGISTER
THEREFOR]
 
REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.
SIGNATURE PAGES FOLLOW.
 
 

--------------------------------------------------------------------------------

 Select or delete as applicable.
2 Amount to be adjusted by the counterparties to take into account any payments
made between the Trade Date and the Effective Date.
3 Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans of
all Lenders thereunder.
* Amounts to be adjusted by the counterparties to take into account payments and
prepayments made between the Trade Date and the Effective Date.
4 To be completed if the Assignor and the Assignee intend that the minimum
assignment amount is to be determined as of the Trade Date. If Trade Date is
specified in the Assignment and Assumption Agreement, as of the Trade Date,
shall not be less than $2,500,000, and, after such assignment, no Lender shall
hold a Commitment of less than $5,000,000.
 
2
 
Exhibit M

--------------------------------------------------------------------------------

 
 
The terms set forth in this Assignment and Assumption are hereby agreed to:
 

 
ASSIGNOR
  [NAME OF ASSIGNOR]       
 
 
By:
 
Name: 
  Title: 

 

 
ASSIGNEE
  [NAME OF ASSIGNEE]       
 
 
By:
 
Name: 
  Title: 

 
[Consented to and]5 Accepted:
 

 
BANK OF AMERICA, N.A., as Administrative Agent
 
By:
       Name:
       Title:

 
[Consented to]6 [and Acknowledged]7 by:
 

 
ACADIA STRATEGIC OPPORTUNITY FUND III
 
LLC, a Delaware limited liability company
         
By: /s/ Robert Masters
 
Name: Robert Masters
 
Title: Senior Vice President

 
 

--------------------------------------------------------------------------------

5 To be used only if the consent of the Administrative Agent is required by the
terms of the Credit Agreement.
6 To be used only if the consent of the Borrower is required by the terms of the
Credit Agreement.
7 To be used only if assignment is made as a result of a demand by Borrower
under the Credit Agreement.
 
3
 
Exhibit M

--------------------------------------------------------------------------------

 
 
ANNEX 1 TO ASSIGNMENT AND ASSUMPTION AGREEMENT
STANDARD TERMS AND CONDITIONS FOR
ASSIGNMENT AND ASSUMPTION
 
1.                       Representations and Warranties.
 
1.1 Assignor. The Assignor: (a) represents and warrants that: (i) it is the
legal and beneficial owner of the Assigned Interest; (ii) the Assigned Interest
is free and clear of any lien, encumbrance or other adverse claim; and (iii) it
has full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby; and (b) assumes no responsibility with respect to: (i) any
statements, warranties or representations made in or in connection with the
Credit Agreement or any other Loan Document; (ii) the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Loan
Documents or any collateral thereunder; (iii) the financial condition of the
Borrower, any of its subsidiaries or Affiliates or any other Person obligated in
respect of any Loan Document; or (iv) the performance or observance by the
Borrower, any of its subsidiaries or Affiliates or any other Person of any of
their respective obligations under any Loan Document.
 
1.2. Assignee. The Assignee: (a) represents and warrants that: (i) it has full
power and authority, and has taken all action necessary, to execute and deliver
this Assignment and Assumption and to consummate the transactions contemplated
hereby and to become a [Conduit Lender] [Alternate Lender] under the Credit
Agreement; (ii) it meets all requirements of an Eligible Assignee under the
Credit Agreement (subject to receipt of such consents as may be required under
the Credit Agreement); (iii) from and after the Effective Date, it shall be
bound by the provisions of the Credit Agreement as a [Conduit Lender] [Alternate
Lender] thereunder and, to the extent of the Assigned Interest, shall have the
obligations of a [Conduit Lender] [Alternate Lender] thereunder; (iv) it has
received a copy of the Credit Agreement, together with copies of the most recent
financial statements delivered pursuant to Section 9.1 thereof, as applicable,
and such other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into this Assignment and
Assumption and to purchase the Assigned Interest on the basis of which it has
made such analysis and decision independently and without reliance on the
Administrative Agent or any other Lender; and (v) if it is a Foreign Lender,
attached to the Assignment and Assumption is any documentation required to be
delivered by it pursuant to the terms of the Credit Agreement, duly completed
and executed by the Assignee; and (b) agrees that: (i) it will, independently
and without reliance on the Administrative Agent, the Assignor or any other
Lender, and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit decisions in taking or not taking
action under the Loan Documents; and (ii) it will perform in accordance with
their terms all of the obligations which by the terms of the Loan Documents are
required to be performed by it as a [Conduit Lender] [Alternate Lender].
 
2.             Payments. From and after the Effective Date, the Administrative
Agent shall make all payments in respect of the Assigned Interest (including
payments of principal, interest, fees and other amounts) to the Assignor for
amounts which have accrued to but excluding the Effective Date and to the
Assignee for amounts which have accrued from and after the Effective Date.
 
4
 
Exhibit M

--------------------------------------------------------------------------------

 
 
3. General Provisions. This Assignment and Assumption shall be binding upon. and
inure to the benefit of, the parties hereto and their respective successors and
assigns. This Assignment and Assumption may be executed in any number of
counterparts, which together shall constitute one instrument. Delivery of an
executed counterpart of a signature page of this Assignment and Assumption by
telecopy shall be effective as delivery of a manually executed counterpart of
this Assignment and Assumption. Pursuant to Section 5-1401 of the New York
General Obligations Law, the substantive laws of the State of New York, without
regard to the choice of law principles that might otherwise apply, and the
applicable federal laws of the United States of America, shall govern the
validity, construction, enforcement and interpretation of this Assignment and
Assumption.
 
5
 
Exhibit M

--------------------------------------------------------------------------------

 
 
EXHIBIT N
to Revolving Credit Agreement
by and among
Acadia Strategic Opportunity Fund III LLC, as Borrower,
Acadia Realty Acquisition III LLC, as Managing Member,
Acadia Realty Limited Partnership, as Guarantor,
Acadia Investors III, Inc., as Pledgor,
Bank of America, N.A., as Administrative Agent,
Banc of America Securities LLC, as Sole Lead Arranger and Sole Book Manager,
YC SUSI Trust, as Conduit Lender,
Bank of America, N.A., as an Administrator, Alternate Lender and Managing Agent,
and
the other Conduit Lenders, Administrators, Alternate Lenders and Managing Agents
from
time to time party thereto
 
  FORM OF BORROWER GUARANTY
 
 Dated________________, 20__
 
1.             The undersigned, Acadia Strategic Opportunity Fund III LLC, a
Delaware limited liability company ("Guarantor"), hereby irrevocably,
unconditionally and absolutely guarantees in favor of BANK OF AMERICA, N.A., as
Administrative Agent for each of the Secured Parties under that certain Credit
Agreement referred to below ("Creditor"), the prompt payment when due of all
interest, principal, fees, expenses and other amounts now or hereafter
represented by, or arising in connection with: (a) that certain Qualified
Borrower [Promissory] [Letter of Credit] Note (the "Qualified Borrower Note"),
dated, 20 in the amount of $______, payable by __________("Qualified Borrower")
to the order of Creditor, including without limitation all liabilities and
indebtedness represented or evidenced by any promissory note given in renewal,
extension, modification or substitution of or for the Qualified Borrower Note;
and (b) all obligations of Qualified Borrower under the Credit Agreement
(collectively, the "Guaranteed Debt"). This is an unconditional guaranty of
payment, and not a guaranty of collection, and Creditor may enforce Guarantor's
obligations hereunder pursuant to Section 2.6 of the Credit Agreement without
first suing, or enforcing its rights or remedies against, Qualified Borrower or
any other obligor, or enforcing or collecting any present or future collateral
security for the Guaranteed Debt. Unless otherwise defined in this guaranty
agreement (this "Borrower Guaranty"), capitalized terms not defined herein shall
have the meanings assigned to such terms in the Credit Agreement (hereinafter
defined).
 
2.             Guarantor hereby waives notice of: (a) acceptance of this
Borrower Guaranty; (b) the extension of credit by Creditor to Qualified
Borrower; (c) the occurrence of any breach or default by Qualified Borrower in
respect of the Guaranteed Debt; (d) the sale or foreclosure on any collateral
for the Guaranteed Debt; (e) the transfer of the Guaranteed Debt to any third
party to the extent permitted under the Credit Agreement and to the extent that
such notice is not required under the Credit Agreement; and (f) all other
notices, except as otherwise required under the Credit Agreement.
 
 
Exhibit N

--------------------------------------------------------------------------------

 
 
3.            Guarantor hereby consents and agrees to, and acknowledges that its
obligations hereunder shall not be released or discharged by, the following: (a)
the renewal, extension, modification or alteration of the Qualified Borrower
Note, the Guaranteed Debt or any related document or instrument; (b) any
forbearance or compromise granted to Qualified Borrower by Creditor; (c) the
insolvency, bankruptcy, liquidation or dissolution of Qualified Borrower; (d)
the invalidity, illegality or unenforceability of all or any part of the
Guaranteed Debt; (e) the full or partial release of the Qualified Borrower or
any other obligor; (f) the 'release, surrender, exchange, subordination,
deterioration, waste, loss or impairment (including without limitation
negligent, willful, unreasonable or unjustifiable impairment) of any collateral
for the Guaranteed Debt; (g) the failure of Creditor properly to obtain, perfect
or preserve any security interest or lien in any such collateral; (h) the
failure of Creditor to exercise diligence, commercial reasonableness or
reasonable care in the preservation, enforcement or sale of any such collateral;
and (i) any other act or omission of Creditor or Qualified Borrower which would
otherwise constitute or create a legal or equitable defense in favor of
Guarantor.
 
4.            Notwithstanding anything to the contrary in this Borrower
Guaranty, until the Guaranteed Debt has been paid in full, Guarantor hereby
irrevocably waives all rights it may have at law or in equity (including,
without limitation, any law subrogating Guarantor to the rights of Creditor) to
seek contribution, indemnification, or any other form of reimbursement from
Qualified Borrower, any other guarantor, or any other person now or hereafter
primarily or secondarily liable for any obligations of Qualified Borrower to
Creditor, for any disbursement made by Guarantor under or in connection with
this Borrower Guaranty or otherwise.
 
5.            Guarantor represents and warrants that it has received or will
receive direct or indirect benefit from the making of this Borrower Guaranty and
the creation of the Guaranteed Debt, that Guarantor is familiar with the
financial condition of Qualified Borrower and the value of any collateral
security for the Guaranteed Debt and that Creditor has made no representations
to Guarantor in order to induce Guarantor to execute this Borrower Guaranty.
 
6.            If Qualified Borrower is or shall hereafter be liable to Creditor
for any obligation, indebtedness or liability other than the Guaranteed Debt,
and Creditor should collect or receive any payments, funds or distributions
which are not specifically required, by law or agreement, to be applied to the
Guaranteed Debt, then Creditor may, in its sole discretion, apply such payments,
funds or distributions to indebtedness of Qualified Borrower other than the
Guaranteed Debt.
 
7.            This Borrower Guaranty shall continue to be effective or be
reinstated, as the case may be, if at any time any payment of any of the
Guaranteed Debt is rescinded or must otherwise be returned by the Creditor, upon
the insolvency, bankruptcy, reorganization, or dissolution of the Qualified
Borrower or otherwise, all as though such payment had not been made.
 
8.            This Borrower Guaranty has been executed and delivered pursuant to
that certain Revolving Credit Agreement (as amended, modified, supplemented, or
restated from time to time, the "Credit Agreement") dated as of October 10,
2007, by and among Guarantor, Acadia Realty Acquisition III LLC, as Managing
Member, Acadia Realty Limited Partnership, as Guarantor, Acadia Investors III,
Inc., as Pledgor, Creditor, Banc of America Securities LLC, as Sole Lead
Arranger and Sole Book Manager, YC SUSI Trust, as Conduit Lender, Bank of
America, N.A., as an Administrator, Alternate Lender and Managing Agent and the
other Conduit Lenders, Administrators, Alternate Lenders and Managing Agents
from time to time party thereto, and is one of the "Borrower Guaranties"
referred to therein. This Borrower Guaranty may be amended only by a written
instrument executed by Guarantor and Creditor.
 
2
 
Exhibit N

--------------------------------------------------------------------------------

 
 
9.            Pursuant to Section 5-1401 of the New York General Obligations
Law, the substantive laws of the State of New York, without regard to the choice
of law principles that might otherwise apply, and the applicable federal laws of
the United States of America, shall govern the validity, construction,
enforcement and interpretation of this Borrower Guaranty.
 
10.            Any suit, action or proceeding against Guarantor with respect to
this Borrower Guaranty or any judgment entered by any court in respect hereof,
may be brought in the courts of the State of New York, or in the United States
Courts located in the Borough of Manhattan in New York City as Creditor in its
sole discretion may elect and Guarantor hereby submits to the non-exclusive
jurisdiction of such courts for the purpose of any such suit, action or
proceeding. Guarantor hereby irrevocably consents to the service of process in
any suit, action or proceeding in said court by the mailing thereof by Creditor
by registered or certified mail, postage prepaid, to Guarantor's address at c/o
Acadia Realty Trust, 1311 Mamaroneck Avenue, Suite 260, White Plains, New York
10605, Attention: Robert Masters, Esq. Guarantor hereby irrevocably waives any
objections which it may now or hereafter have to the laying of venue of any
suit, action or proceeding arising out of or relating to this Borrower Guaranty
brought in the courts located in the State of New York, Borough of Manhattan in
New York City, and hereby further irrevocably waives any claim that any such
suit, action or proceeding brought in any such court has been brought in an
inconvenient forum. GUARANTOR, AND BY ITS ACCEPTANCE HEREOF CREDITOR, EACH
HEREBY WAIVES TRIAL BY JURY IN ANY SUIT, ACTION OR PROCEEDING BROUGHT IN
CONNECTION WITH THIS BORROWER GUARANTY, WHICH WAIVER IS INFORMED AND VOLUNTARY.
 
Reference is hereby made to Section 14.19 of the Credit Agreement regarding the
non-personal liability of Managing Member, the provisions of which are hereby
incorporated by reference in this Borrower Guaranty as if fully set forth
herein, for the payment and performance of Guarantor's obligations hereunder.
 
On the full, final and complete satisfaction of the Guaranteed Debt, this
Guaranty shall be of no further force or effect. Thereafter, upon request,
Creditor shall reasonably provide Guarantor, at Guarantor's sole expense, a
written release of its obligations hereunder.
 
REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.
SIGNATURE PAGES FOLLOW.
 
3
 
Exhibit N

--------------------------------------------------------------------------------

 
 
EXECUTED on the date first above written.
 

 
ACADIA STRATEGIC OPPORTUNITY FUND III
 
LLC, a Delaware limited liability company
         
By: /s/ Robert Masters
 
Name: Robert Masters
 
Title: Senior Vice President

 

 
Acknolwedged and Agreed:
     
ACADIA REALTY LIMITED PARTNERSHIP,
 
a Delaware limited liability company
      By: ACADIA REALTY TRUST,  
its general partner
     
By: /s/ Robert Masters
 
Name: Robert Masters
 
Title: Senior Vice President

 
 
Signature Page to
Guaranty of Payment
Exhibit N

--------------------------------------------------------------------------------

 
 

  Accepted and Approved:       BANK OF AMERICA, N.A.   as Administrative Agent 
     
By:
 
Name:
 
Title:

 
 
Exhibit N

--------------------------------------------------------------------------------

 
 
EXHIBIT 0
to Revolving Credit Agreement
by and among
Acadia Strategic Opportunity Fund III LLC, as Borrower,
Acadia Realty Acquisition III LLC, as Managing Member,
Acadia Realty Limited Partnership, as Guarantor,
Acadia Investors III, Inc., as Pledgor,
Bank of America, N.A., as Administrative Agent,
Banc of America Securities LLC, as Sole Lead Arranger and Sole Book Manager,
YC SUSI Trust, as Conduit Lender,
Bank of America, N.A., as an Administrator, Alternate Lender and Managing Agent,
and
the other Conduit Lenders, Administrators, Alternate Lenders and Managing Agents
from
time to time party thereto
 
FORM OF COMPLIANCE CERTIFICATE FOR [              ] ENDED [              ]
DATE: [DATE]
 
ADMINISTRATIVE AGENT: Bank of America, N.A.
 
BORROWER:                                                     Acadia Strategic
Opportunity Fund III LLC
 
 
This certificate is delivered under the Revolving Credit Agreement, dated as of
October 10, 2007 (as amended, modified, supplemented, or restated from time to
time, the "Credit Agreement"), among Borrower, Acadia Realty Acquisition III
LLC, as Managing Member, Acadia Realty Limited Partnership, as Guarantor, Acadia
Investors III, Inc., as Pledgor, Administrative Agent, Banc of America
Securities LLC, as Sole Lead Arranger and Sole Book Manager, YC SUSI Trust, as
Conduit Lender, Bank of America, N.A., as an Administrator, Alternate Lender and
Managing Agent and the other Conduit Lenders, Administrators, Alternate Lenders
and Managing Agents from time to time party thereto. Capitalized terms not
defined herein shall have the meanings assigned to such terms in the Credit
Agreement.

 
The undersigned Responsible Officer hereby certifies as of the date hereof that
he/she is authorized to execute and deliver this certificate to the
Administrative Agent on behalf of Borrower, and that as of [date at the end of
the period indicated above] (the "Reporting Date"):
 
 
(a) The undersigned has reviewed and is familiar with the terms and provisions
of the Loan Documents and has made, or caused to be made under his/her
supervision, a detailed review of the transactions and condition (financial or
otherwise) of Borrower during the account period covered by the attached
financial statements, which fairly represent the financial condition and the
results of the operations of the Borrower, and no Event of Default (nor any
Potential Default) exists which has not been cured or waived (except the Events
of Default or Potential Defaults, if any, together with the details of the
actions that Borrower is taking or proposes to take with respect thereto,
described on Annex A to this Certificate);

 
 
Exhibit O

--------------------------------------------------------------------------------

 
 
 
(b)
The Borrowers are in compliance with all the covenants set forth in Section 10
of the Credit Agreement and Borrower and Pledgor are in compliance with Section
11.11 of the Credit Agreement, and calculations evidencing such status are as
set forth on Annex B to this certificate; and

 
 
(c)
The calculation of the Borrowing Base attached hereto as Annex C is true and
correct as of the date hereof, and any Investors which have been subject to an
Exclusion Event are noted thereon.

 

  [Signature of Responsible Officer]      
By:
 
Name:
 
Title:

 
 
Exhibit O

--------------------------------------------------------------------------------

 
 
ANNEX A
 
 
Annex A

--------------------------------------------------------------------------------

 
 
ANNEX B
 
 
Annex B

--------------------------------------------------------------------------------

 
 
ANNEX C
 
 
Annex C

--------------------------------------------------------------------------------

 
 
EXHIBIT P
to Revolving Credit Agreement
by and among
Acadia Strategic Opportunity Fund III LLC, as Borrower,
Acadia Realty Acquisition III LLC, as Managing Member,
Acadia Realty Limited Partnership, as Guarantor,
Acadia Investors III, Inc., as Pledgor,
Bank of America, N.A., as Administrative Agent,
Banc of America Securities LLC, as Sole Lead Arranger and Sole Book Manager,
YC SUSI Trust, as Conduit Lender,
Bank of America, N.A., as an Administrator, Alternate Lender and Managing Agent,
and
the other Conduit Lenders, Administrators, Alternate Lenders and Managing Agents
from
time to time party thereto
FORM OF GUARANTY OF CAPITAL
 
[See Tab 6]
 
Exhibit P