Exhibit 10.2 to 2010 10-Q

AMENDED AND RESTATED PARTICIPATION AGREEMENT

Dated as of June 30, 2010

among

CONVERGYS CORPORATION, as the Lessee,

THE VARIOUS PARTIES HERETO FROM TIME TO TIME,

as the Guarantors,

WACHOVIA DEVELOPMENT CORPORATION,

as the Borrower and as the Lessor,

THE VARIOUS BANKS AND OTHER LENDING INSTITUTIONS WHICH ARE PARTIES

HERETO FROM TIME TO TIME, as the Credit Lenders,

THE VARIOUS BANKS AND OTHER LENDING INSTITUTIONS WHICH ARE PARTIES

HERETO FROM TIME TO TIME, as the Mortgage Lenders,

and

WELLS FARGO BANK, NATIONAL ASSOCIATION,

as the Agent for the Primary Financing Parties

and, respecting the Security Documents,

as the Agent for the Secured Parties

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TABLE OF CONTENTS

 

SECTION 1A AMENDMENT AND RESTATEMENT

   SECTION 1 THE FINANCING    SECTION 2 CONTINUATION OF LEASE FACILITY    2
SECTION 3 SUMMARY OF TRANSACTIONS    2

   3.1

     Operative Agreements.    2

   3.2

     Deemed Loans and Lessor Advances.    2 SECTION 4 THE CLOSING    3

   4.1

     Closing Date.    3

   4.2

     Advances.    3 SECTION 5 CLOSING CONDITIONS    3

   5.1

     General.    3

   5.2

     Procedures for Closing.    3

   5.3

     Conditions Precedent for the Agent, the Credit Lenders, the Mortgage
Lenders and the Lessor Relating to the Closing Date.    4

   5.4

     [Reserved].    8

   5.5

     [Reserved].    8

   5.6

     [Reserved].    8

   5.7

     Restrictions on Liens.    8

   5.8

     [Reserved].    9

   5.9

     [Reserved].    9

   5.10

     Payments.    9

   5.11

     Amounts Due Under Lease.    9 SECTION 5B LESSOR ADVANCE    9

5B.1

     Procedure for Lessor Advance.    9

5B.2

     Lessor Yield.    10

5B.3

     Scheduled Return of Lessor Advance.    10

5B.4

     Early Return of Lessor Advance.    10

5B.5

     Conversion and Continuation Options.    11

5B.6

     Computation of Lessor Yield.    11 SECTION 6 REPRESENTATIONS AND WARRANTIES
   12

   6.1

     Representations and Warranties of the Borrower.    12

   6.2

     Representations and Warranties of the Credit Parties.    14 SECTION 6B
GUARANTY    19

6B.1

     Guaranty of Payment and Performance.    19

6B.2

     Obligations Unconditional.    19

6B.3

     Modifications.    20

6B.4

     Waiver of Rights.    21

6B.5

     Reinstatement.    21

6B.6

     Remedies.    21

6B.7

     Limitation of Guaranty.    21

6B.8

     Contribution.    22

6B.9

     Payment of Amounts to the Agent.    22

6B.10

     Release of Guarantors.    22 SECTION 7 PAYMENT OF CERTAIN EXPENSES    22

   7.1

     Transaction Expenses.    22

   7.2

     Brokers’ Fees.    23

   7.3

     Certain Fees and Expenses.    23

   7.4

     [Reserved].    23

   7.5

     Administrative Fee.    23

 

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7.6

  Arrangement Fee.    23

7.7

  Up-Front Fee.    23

SECTION 8 OTHER COVENANTS AND AGREEMENTS

   24

8.1

  Cooperation with the Lessee.    24

8.2

  Covenants of the Lessor.    24

8.3

  Lessee Covenants, Consent and Acknowledgment.    26

8.3A

  Affirmative Covenants.    29

8.3A.1

  Financial Statements and Other Information.    29

8.3A.2

  Notices of Material Events.    30

8.3A.3

  Existence; Conduct of Business.    30

8.3A.4

  Payment of Obligations.    31

8.3A.5

  Maintenance of Property; Insurance.    31

8.3A.6

  Books and Records; Inspection Rights.    31

8.3A.7

  Compliance with Laws.    31

8.3A.8

  Use of Proceeds.    31

8.3A.9

  Guarantee Requirement.    31

8.3B

  Negative Covenants.    32

8.3B.1

  Priority Indebtedness.    32

8.3B.2

  Liens.    33

8.3B.3

  Sale and Lease-Back Transactions.    34

8.3B.4

  Fundamental Changes.    34

8.3B.5

  Transactions with Affiliates.    36

8.3B.6

  Restrictive Agreements.    37

8.3B.7

  Hedging Agreements.    37

8.3B.8

  Interest Coverage Ratio.    37

8.3B.9

  Consolidated Total Debt to Consolidated EBITDA Ratio.    37

8.3B.10

  Certain Restricted Payments.    37

8.4

  Sharing of Certain Payments.    37

8.5

  Grant of Easements, etc.    38

8.6

  Appointment of the Agent by the Primary Financing Parties.    38

8.7

  Collection and Allocation of Payments and Other Amounts; Special Provision
Regarding Post-Expiration Date Sales.    42

8.8

  Release of the Property, etc.    44

8.9

  Limitation of Lessor’s Obligations.    44

8.10

  NO REPRESENTATIONS OR WARRANTIES AS TO THE PROPERTY OR OPERATIVE AGREEMENTS.
   45

8.11

  Reliance; Advice of Counsel.    45

8.12

  Amendments to Lessee Credit Agreement.    46

8.13

  Non-Disturbance.    46 SECTION 9 LOAN AGREEMENTS    46

9.1

  The Lessee’s Loan Agreement Rights.    46 SECTION 10 TRANSFER OF INTEREST   
47

10.1

  Restrictions on Transfer.    47

10.2

  Effect of Transfer.    48

SECTION 11 INDEMNIFICATION

   49

11.1

  General Indemnity.    49

11.2

  General Tax Indemnity.    52

11.3

  Increased Costs, Illegality, etc.    56

11.4

  Funding/Contribution Indemnity.    58

11.5

  EXPRESS INDEMNIFICATION FOR ORDINARY NEGLIGENCE, STRICT LIABILITY, ETC.    59

 

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11.6

   Additional Provisions regarding Environmental Indemnification.    59

11.7

   Cooperation with the Indemnity Provider.    60

11.8

   Time Period in which Claims may arise and be Covered by Indemnification.   
60

SECTION 12 MISCELLANEOUS

   60

12.1

   Survival of Agreements.    60

12.2

   Notices.    61

12.3

   Counterparts.    63

12.4

   Terminations, Amendments, Waivers, Etc.; Unanimous Vote Matters.    63

12.5

   Headings, etc.    65

12.6

   Parties in Interest.    65

12.7

   GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL; VENUE.    65

12.8.

   Severability.    66

12.9.

   Liability Limited.    66

12.10.

   Rights of the Credit Parties.    67

12.11.

   Further Assurances.    67

12.12.

   Calculations under Operative Agreements; Consents.    68

12.13.

   Confidentiality.    68

12.14.

   Financial Reporting/Tax Characterization.    69

12.15.

   Set-off.    69

 

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SCHEDULES and EXHIBITS

SCHEDULES

 

Schedule 6.2(a)

  -    Corporate Existence Exceptions for Lessee and Subsidiaries

Schedule 6.2(f)

  -    Disclosed Matters

Schedule 6.2(m)

  -    Material Subsidiaries

Schedule 8.3B.1

  -    Existing Indebtedness

Schedule 8.3B.6

  -    Restrictive Agreements

EXHIBITS

 

A

  -   Form of Requisition - Sections 4.2, 5.2 and 5.3

B

  -   [Reserved]

C

  -   Form of Officer’s Certificate - Section 5.3(y)

D

  -   Form of Secretary’s Certificate - Section 5.3(z)

E

  -   Form of Officer’s Certificate - Section 5.3(bb)

F

  -   Form of Secretary’s Certificate - Section 5.3(cc)

G

  -   [Reserved]

H

  -   [Reserved]

I

  -   [Reserved]

J

  -   [Reserved]

K

  -   [Reserved]

L

  -   State of Incorporation/Formation and Principal Place of Business of the
Credit Parties – Section 6.2(o)

 

Appendix A - Rules of Usage and Definitions

 

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AMENDED AND RESTATED PARTICIPATION AGREEMENT

THIS AMENDED AND RESTATED PARTICIPATION AGREEMENT, dated as of June 30, 2010 (as
amended, modified, extended, supplemented, restated and/or replaced from time to
time, this “Agreement”) is by and among CONVERGYS CORPORATION, an Ohio
corporation (the “Lessee”); the various parties hereto from time to time as
guarantors (subject to the definition of Guarantors in Appendix A hereto,
individually, a “Guarantor” and collectively, the “Guarantors”); WACHOVIA
DEVELOPMENT CORPORATION, a North Carolina corporation (the “Borrower” or the
“Lessor”); the various banks and other lending institutions which are parties
hereto from time to time as holders of the Credit Notes (subject to the
definition of Credit Lenders in Appendix A hereto, individually, a “Credit
Lender” and collectively, the “Credit Lenders”); the various banks and other
lending institutions which are parties hereto from time to time as holders of
the Mortgage Notes (subject to the definition of Mortgage Lenders in Appendix A
hereto, individually, a “Mortgage Lender” and collectively, the “Mortgage
Lenders”); (the Lessor, each Credit Lender and each Mortgage Lender may be
referred to individually as a “Primary Financing Party” and collectively as the
“Primary Financing Parties”); and WELLS FARGO BANK, NATIONAL ASSOCIATION, a
national banking association, as the agent for the Primary Financing Parties and
respecting the Security Documents, as the agent for the Secured Parties (in such
capacity, the “Agent”). Capitalized terms used but not otherwise defined in this
Agreement shall have the meanings set forth in Appendix A hereto.

W I T N E S S E T H:

A. WHEREAS, the parties to that certain Existing Participation Agreement entered
into the various Existing Operative Agreements in order to finance the Property.

B. WHEREAS, the parties to this Agreement and the other Operative Agreements
have entered into such agreements in order to renew the financing for the
Property by means of amending and restating the Existing Operative Agreements.

NOW, THEREFORE, in consideration of the mutual agreements herein contained and
other good and valuable consideration, the receipt of which is hereby
acknowledged, the parties hereto hereby agree as follows:

SECTION 1A

AMENDMENT AND RESTATEMENT

This Agreement amends and restates in its entirety the Existing Participation
Agreement. This Agreement is not intended to constitute a novation of the
Existing Participation Agreement.

SECTION 1

THE FINANCING

Subject to the terms and conditions of this Agreement (including without
limitation the satisfaction or waiver of the requirements and closing conditions
set forth in Section 5 of this Agreement) and the other Operative Agreements and
in reliance on the representations and warranties of each of the parties hereto
contained herein or made pursuant hereto, the Primary Financing Parties have
agreed to pay the various amounts described in the Assignment and
Recharacterization Agreement in exchange for (i) in the case of the Lessor, all
of the Existing Lessor’s rights and obligations under the Existing Operative

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Agreements, pursuant to Section 3(b) of the Assignment and Recharacterization
Agreement; (ii) in the case of the Credit Lenders, certain of the Existing Debt
Providers’ rights and obligations under the Existing Operative Agreements,
pursuant to Section 3(a) of the Assignment and Recharacterization Agreement; and
(iii) in the case of the Mortgage Lenders, certain of the Existing Debt
Providers’ rights and obligations under the Existing Operative Agreements,
pursuant to Section 3(a) of the Assignment and Recharacterization Agreement.
After the Lessor, the Credit Lenders and the Mortgage Lenders make the payments
to the Agent described in the prior sentence, the Existing Lessor Advances and
the Existing Loans shall be assigned in accordance with Sections 3(a) and 3(b)
of the Assignment and Recharacterization Agreement.

Regarding the Credit Loans and the Mortgage Loans, after the Lenders make the
payments described in the preceding paragraph in exchange for the
above-described assignment to the Lenders of the Existing Loans and the related
purchase of rights and obligations, the Credit Loans and the Mortgage Loans
shall, pursuant to Section 3(c) of the Assignment and Recharacterization
Agreement, without the need for any further action, be immediately consolidated,
substituted and recharacterized, respectively as the Credit Loans (in the case
of the Credit Lenders) and Mortgage Loans (in the case of the Mortgage Lenders),
and the Credit Lenders and the Mortgage Lenders shall, for purposes of the
Operative Agreements, be deemed to have made or funded the Credit Loans and the
Mortgage Loans, respectively.

Regarding the Lessor Advances, after the Lessor makes the payment described in
the second preceding paragraph in exchange for the above-described assignment to
the Lessor of the Existing Lessor Advances and the related purchase of rights
and obligations, the Lessor shall, for purposes of the Operative Agreements, be
deemed to have made or funded the Lessor Advances. The obligations of the Lessee
to the Lessor and the obligations of the Borrower to the Credit Lenders and the
Mortgage Lenders under the Operative Agreements shall be secured by the
Property.

SECTION 2

CONTINUATION OF LEASE FACILITY

Each party hereto agrees that the Operative Agreements amend and restate the
Existing Operative Agreements and that the financing and leasing arrangements of
the Property pursuant to the Operative Agreements shall renew and continue the
financing and leasing arrangement of the Property pursuant to the Existing
Operative Agreements.

SECTION 3

SUMMARY OF TRANSACTIONS

3.1 Operative Agreements.

On the Closing Date, each of the respective parties hereto and thereto shall
execute and deliver this Agreement, the Lease, the Credit Note Loan Agreement,
the Credit Notes, the Mortgage Note Loan Agreement, the Mortgage Notes, the
Security Agreement, each applicable Mortgage Instrument and such other
documents, instruments, certificates and opinions of counsel as agreed to by the
parties hereto.

3.2 Deemed Loans and Lessor Advances.

On the Closing Date and subject to the terms and conditions of this Agreement
(a) the Credit Lenders will be deemed to have made the Credit Loans as described
in Section 1 of this Agreement, (b) the Mortgage Lenders will be deemed to have
made the Mortgage Loans as described in Section 1 of

 

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this Agreement, (c) the Lessor will be deemed to have made the Lessor Advance as
described in Section 1 of this Agreement, (d) the Lessor shall retain title to
or a ground lease interest in each applicable Property, each to be within an
Approved State, identified by the Lessee, in each case pursuant to a Bill of
Sale and Deed or Ground Lease, as the case may be, and amend and restate its
grant to the Agent (on behalf of the Secured Parties) of a lien on the Property
by execution of the required Security Documents, (e) the Agent, the Lessee and
the Lessor shall execute and deliver an amended and restated Lease Supplement
relating to the Property and (f) the Term shall commence with respect to the
Property. Unless the context otherwise requires, references in the Operative
Agreements to the acquisition of the Property (including without limitation a
ground lease interest in the Property) by the Lessor shall be deemed to refer to
the retention of title to the Property or the retention of a ground lease
interest therein through the Assignment and Recharacterization Agreement.

SECTION 4

THE CLOSING

4.1 Closing Date.

All documents and instruments required to be delivered on the Closing Date shall
be delivered at the offices of Moore & Van Allen PLLC, Charlotte, North
Carolina, or at such other location as may be determined by the Lessor, the
Agent and the Lessee.

4.2 Advances.

The Lessee shall deliver to the Agent a requisition (a “Requisition”), in the
form attached hereto as Exhibit A or in such other form as is satisfactory to
the Agent, in its reasonable discretion, in connection with the Advances.

SECTION 5

CLOSING CONDITIONS

5.1 General.

To the extent funds have been made available by the Lessor, the Credit Lenders
and the Mortgage Lenders as described in Section 1, the applicable parties to
this Agreement shall effect the various assignment and recharacterization
transactions described in the Assignment and Recharacterization Agreement in
accordance with the terms thereof.

5.2 Procedures for Closing.

(a) The Lessee shall deliver to the Agent, not less than three (3) Business Days
prior to the Closing Date, a Requisition as described in Section 4.2.

(b) [Reserved].

(c) Subject to the satisfaction or waiver of the conditions precedent set forth
in Section 5.3, on the Closing Date, (i) the Credit Lenders shall pay the
amounts specified for payment by the Credit Lenders in accordance with Section 1
of this Agreement (which payments shall result in the purchase and ownership of
Credit Loans in the amounts of such payments pursuant to the Assignment and
Recharacterization Agreement, which Credit Loans shall be

 

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deemed to have been made by the Credit Lenders for purposes of the Operative
Agreements), (ii) the Mortgage Lenders shall pay the amounts specified for
payment by the Mortgage Lenders in accordance with Section 1 of this Agreement
(which payments shall result in the purchase and ownership of Mortgage Loans in
the amounts of such payments pursuant to the Assignment and Recharacterization
Agreement, which Mortgage Loans shall be deemed to have been made by the
Mortgage Lenders for purposes of the Operative Agreements) and (iii) the Lessor
shall pay the amount specified for payment by the Lessor in accordance with
Section 1 of this Agreement (which payments shall result in the purchase and
ownership of a Lessor advance (the “Lessor Advance”) in the amounts of such
payments pursuant to the Assignment and Recharacterization Agreement, which
Lessor Advance shall be deemed to have been made by the Lessor for purposes of
the Operative Agreements). Subject to the foregoing sentence, the Requested
Funds shall be funded by the Credit Lenders, the Mortgage Lenders and the Lessor
such that (I) the Credit Loans made by the Credit Lenders under the Credit Notes
shall equal $29,000,000, (II) the Mortgage Loans made by the Mortgage Lenders
under the Mortgage Notes shall equal $22,100,000, and (III) the Lessor Advance
shall equal $3,900,000.

(d) [Reserved].

(e) All Operative Agreements which are to be delivered to the Lessor, the Agent
or the Primary Financing Parties shall be delivered to the Agent, on behalf of
the Lessor, the Agent or the Primary Financing Parties, and such items (except
for Credit Notes, Mortgage Notes, Bills of Sale, the Deed and chattel paper
originals, with respect to which in each case there shall be only one original)
shall be delivered with originals sufficient for the Lessor, the Agent and each
other Primary Financing Party. The Agent shall then deliver such Operative
Agreements to the Lessor and each other Primary Financing Party. All other items
which are to be delivered to the Lessor, the Agent or the other Primary
Financing Parties shall be delivered to the Agent, on behalf of the Lessor, the
Agent or the other Primary Financing Parties, or directly to such party as
required by the Operative Agreements. Except as otherwise noted, copies shall be
sufficient for any other deliveries to parties other than the Agent required
under Section 5.3. To the extent any such other items delivered to the Agent are
requested in writing from time to time by the Lessor or any other Primary
Financing Party or are required to be delivered by the Agent pursuant to
Section 8.6(g), the Agent shall provide a copy of such item to the party
requesting it or to the parties entitled thereto, as applicable.

(f) [Reserved].

(g) Notwithstanding the completion of the closing under this Agreement pursuant
to Section 5.3, each condition precedent in connection with the closing may be
subsequently enforced as a covenant obligation of the Lessee by the Agent
(unless such has been expressly waived in writing by the Agent).

 

  5.3 Conditions Precedent for the Agent, the Credit Lenders, the Mortgage
Lenders and the Lessor Relating to the Closing Date.

The obligations on the Closing Date of the Agent, the Credit Lenders, the
Mortgage Lenders and the Lessor to enter into the transactions contemplated by
this Agreement, including without limitation the obligation of each party to
execute and deliver the applicable Operative Agreements to which it is a party
and of the Lessor, the Credit Lenders and the Mortgage Lenders to make the
payments described in Section 1 of this Agreement (which payments, as described
in such Section 1, will result, pursuant to the Assignment and
Recharacterization Agreement, in the purchase of rights and obligations deemed
to be the Lessor Advance (in the case of the Lessor) and purchased and
recharacterized as Credit Loans (in the case

 

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of the Credit Lenders) and Mortgage Loans (in the case of the Mortgage Lenders))
(collectively, the Lessor Advance, the Mortgage Loans and the Credit Loans made
on the Closing Date may be referred to as the “Advance”), are subject to the
satisfaction or waiver of the following conditions precedent on or prior to the
Closing Date (it being agreed that (i) to the extent such conditions precedent
require the delivery of any agreement, certificate, instrument, memorandum,
legal or other opinion, appraisal, commitment, title insurance endorsements or
commitments, lien report or any other document of any kind or type, such shall
be in form and substance satisfactory to the Agent and the Primary Financing
Parties, in their reasonable discretion, and (ii) notwithstanding the foregoing,
the obligations of each party shall not be subject to any conditions contained
in this Section 5.3 which are required to be performed by such party):

(a) the correctness on the Closing Date of the representations and warranties of
the parties to this Agreement contained herein, in each of the other Operative
Agreements and each certificate delivered pursuant to any Operative Agreement;

(b) the performance by the parties to this Agreement of their respective
agreements contained herein and in the other Operative Agreements to be
performed by them on or prior to such date;

(c) the Agent and the Primary Financing Parties shall have received fully
executed counterpart copies of the Requisition, appropriately completed;

(d) title to the Property shall conform to the representations and warranties
set forth in Section 6.2(q) hereof;

(e) the Lessee shall have delivered to the Agent and the Primary Financing
Parties a good standing certificate for the Lessee in Florida and shall have
previously delivered the Deed with respect to each parcel of Land and existing
Improvements (or Ground Lease thereof, if applicable) respecting the Property
previously acquired;

(f) there shall not have occurred and be continuing any Default or Event of
Default and no Default or Event of Default will have occurred after giving
effect to the Advance requested by the Requisition;

(g) the Lessee shall have delivered to the Agent and the Primary Financing
Parties separate title insurance endorsements for the existing title policies in
connection with the Existing Operative Agreements for the Credit Loans, the
Mortgage Loans and the Lessor Advance, in favor of the Lessor and the Agent from
a title insurance company reasonably acceptable to the Agent and the Primary
Financing Parties, but only with such title exceptions thereto as are reasonably
acceptable to the Agent and the Primary Financing Parties;

(h) the Lessee shall have delivered to the Agent and the Primary Financing
Parties an environmental site assessment respecting the Property prepared by an
independent recognized professional reasonably acceptable to the Agent and the
Primary Financing Parties in form and substance satisfactory to the Agent and
the Primary Financing Parties;

(i) the Lessee shall have delivered to the Agent and the Primary Financing
Parties an ALTA survey (with a flood hazard certification) respecting the
Property prepared by (i) an independent recognized professional reasonably
acceptable to the Agent and the Primary Financing Parties and (ii) in a manner
and including such information as is reasonably required by the Agent and the
Primary Financing Parties, to the extent such survey is necessary in order to
obtain the title insurance endorsements referenced in Section 5.3(g);

 

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(j) the Lessee shall have caused to be delivered to the Agent and the Primary
Financing Parties a legal opinion in such form as is reasonably acceptable to
the Agent and the Primary Financing Parties with respect to local law real
property issues respecting each state in which the Property is located addressed
to the Lessor, the Agent and the other Primary Financing Parties, from counsel
located in the state where the Property is located, prepared by counsel
reasonably acceptable to the Agent and the Primary Financing Parties;

(k) the Agent and the Primary Financing Parties shall be satisfied that the
acquisition of the Property and the execution of the Mortgage Instruments and
the other Security Documents will not materially and adversely affect the rights
of the Lessor, the Agent or the other Primary Financing Parties under or with
respect to the Operative Agreements;

(l) the Lessee shall have delivered to the Agent and the Primary Financing
Parties invoices for, or other reasonably satisfactory evidence of, the various
Transaction Expenses and other fees, expenses and disbursements referenced in
Section 7 of this Agreement, as appropriate;

(m) the Lessee shall have caused to be delivered to the Agent and the Primary
Financing Parties, Mortgage Instruments and the other Security Documents (in
such form as is reasonably acceptable to the Agent and the Primary Financing
Parties, with revisions as necessary to conform to applicable state law), Lessor
Financing Statements and Primary Financing Party Financing Statements respecting
the Property, all fully executed and in recordable form;

(n) [Reserved];

(o) the Lessee shall have delivered to the Agent with respect to the Property a
Lease Supplement and a memorandum (or short form lease) regarding the Lease and
such Lease Supplement (such memorandum or short form lease to be in the form
attached to the Lease as Exhibit B or in such other form as is acceptable to the
Agent, with modifications as necessary to conform to applicable state law, and
in form suitable for recording);

(p) [Reserved];

(q) [Reserved];

(r) the Lessee shall have provided evidence to the Agent and the Primary
Financing Parties of insurance with respect to the Property as provided in the
Lease;

(s) the Lessee shall have caused an Appraisal regarding the Property to be
provided to the Agent and the Primary Financing Parties from an appraiser
satisfactory to the Agent and the Primary Financing Parties;

(t) the Lessee shall cause (i) Uniform Commercial Code lien searches, tax lien
searches and judgment lien searches regarding the Lessor and the Lessee to be
conducted (and copies thereof to be delivered to the Agent and the Primary
Financing Parties) in such jurisdictions as determined by the Agent by a
nationally recognized search company acceptable to the Agent and (ii) the liens
referenced in such lien searches which are objectionable to the Agent to be
either removed or otherwise handled in a manner satisfactory to the Agent;

 

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(u) all taxes, fees and other charges in connection with the execution,
delivery, recording, filing and registration of the Operative Agreements and/or
documents related thereto shall have been paid or provisions for such payment
shall have been made to the satisfaction of the Agent;

(v) in the reasonable opinion of the Agent and the Primary Financing Parties and
their respective counsel, the transactions contemplated by the Operative
Agreements do not and will not subject the Lessor, the other Primary Financing
Parties or the Agent to any adverse regulatory prohibitions, constraints,
penalties or fines;

(w) each of the Operative Agreements to be entered into on such date shall have
been duly authorized, executed and delivered by the parties thereto, and shall
be in full force and effect, and the Agent and the Primary Financing Parties
shall have received a fully executed copy of each of the Operative Agreements;

(x) [Reserved];

(y) the Agent and the Primary Financing Parties shall have received an Officer’s
Certificate, dated as of the Closing Date, of the Lessee in the form attached
hereto as Exhibit C or in such other form as is reasonably acceptable to the
Agent and the Primary Financing Parties stating that (i) each and every
representation and warranty of the Credit Parties contained in the Operative
Agreements to which any Credit Party is a party is true and correct on and as of
the Closing Date; (ii) no Default or Event of Default has occurred and is
continuing under any Operative Agreement; (iii) each Operative Agreement to
which any Credit Party is a party is in full force and effect with respect to it
except as the same may be limited by applicable bankruptcy, insolvency,
fraudulent transfer or conveyance, reorganization, moratorium or other similar
laws relating to or affecting creditors’ or lessors’ rights generally and
general principles of equity; and (iv) each Credit Party has duly performed and
complied with all covenants, agreements and conditions contained herein or in
any Operative Agreement required to be performed or complied with by it on or
prior to the Closing Date;

(z) the Agent and the Primary Financing Parties shall have received (i) a
certificate of the Secretary or an Assistant Secretary of each Credit Party,
dated as of the Closing Date, in the form attached hereto as Exhibit D or in
such other form as is reasonably acceptable to the Agent and the Primary
Financing Parties attaching and certifying as to (1) the resolutions of the
Board of Directors of such Credit Party duly authorizing the execution, delivery
and performance by such Credit Party of each of the Operative Agreements to
which it is or will be a party, (2) the articles of incorporation of such Credit
Party certified as of a recent date by the Secretary of State of its state of
incorporation and its by-laws and (3) the incumbency and signature of persons
authorized to execute and deliver on behalf of such Credit Party the Operative
Agreements to which it is or will be a party and (ii) a good standing
certificate (or local equivalent) from the respective states where such Credit
Party is incorporated and where the principal place of business of such Credit
Party is located as to its good standing in each such state;

(aa) there shall not have occurred any material adverse change in the
consolidated assets, liabilities, operations, business or condition (financial
or otherwise) of the Lessee (on a consolidated basis) from that set forth in the
most recent audited consolidated financial statements of the Lessee which have
been provided to the Agent and the Primary Financing Parties;

(bb) the Agent, the Lessee, the Credit Lenders and the Mortgage Lenders shall
have received an Officer’s Certificate of the Lessor dated as of the Closing
Date in the form attached

 

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hereto as Exhibit E or in such other form as is reasonably acceptable to the
Agent and the Lessee, stating that (i) each and every representation and
warranty of the Lessor contained in the Operative Agreements to which it is a
party is true and correct on and as of the Closing Date, (ii) each Operative
Agreement to which the Lessor is a party is in full force and effect with
respect to it, (iii) the Lessor has duly performed and complied with all
covenants, agreements and conditions contained herein or in any Operative
Agreement required to be performed or complied with by it on or prior to the
Closing Date and (iv) no Default or Event of Default attributable solely to
Lessor has occurred and is continuing under any Operative Agreement;

(cc) the Agent, the Lessee, the Credit Lenders and the Mortgage Lenders shall
have received (i) a certificate of the Secretary or an Assistant Secretary of
the Lessor in the form attached hereto as Exhibit F or in such other form as is
reasonably acceptable to the Agent and the Lessee, attaching and certifying as
to (A) the signing resolutions duly authorizing the execution, delivery and
performance by the Lessor of each of the Operative Agreements to which it is or
will be a party, (B) its articles of incorporation certified as of a recent date
by the Secretary of State of its state of incorporation and its by-laws and
(C) the incumbency and signature of persons authorized to execute and deliver on
its behalf the Operative Agreements to which it is a party and (ii) a good
standing certificate from the appropriate governmental authority in the
jurisdiction of the Lessor’s organization and in Florida;

(dd) counsel for the Lessor acceptable to the Agent shall have issued to the
Lessee, the Primary Financing Parties and the Agent its opinion in such form as
is reasonably acceptable to the Agent and the Primary Financing Parties and the
Lessee;

(ee) the Lessee shall have caused to be delivered to the Agent and the Primary
Financing Parties a legal opinion in such form as is reasonably acceptable to
the Agent and the Primary Financing Parties, addressed to the Lessor, the Agent
and the Primary Financing Parties, from counsel reasonably acceptable to the
Agent;

(ff) [Reserved];

(gg) no Casualty and no Condemnation respecting the Property shall have occurred
and no action shall be pending or threatened by a Governmental Authority to
initiate a Condemnation with respect to the Property; and

(hh) [Reserved].

5.4 [Reserved].

5.5 [Reserved].

5.6 [Reserved].

5.7 Restrictions on Liens.

On the Closing Date, the Lessee shall cause the Property to be free and clear of
all Liens except those referenced in Sections 6.2(u)(i) and 6.2(u)(ii). On the
date the Property is either sold to a third party in accordance with the terms
of the Operative Agreements or, pursuant to Section 22.1(a) of the Lease
Agreement, retained by the Lessor, the Lessee shall cause the Property to be
free and clear of all Liens (other than Lessor Liens and such other Liens that
are expressly set forth as title exceptions on the title insurance policies with
the endorsements thereto issued under Section 5.3(g) with respect to the
Property, to the extent such title insurance policies and endorsements have been
approved by the Agent).

 

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5.8 [Reserved].

5.9 [Reserved].

5.10 Payments.

All payments of Rent, and other amounts payable to any Financing Party to be
made by the Lessee under this Agreement or any other Operative Agreements
(excluding Excepted Payments which shall be paid directly to the party to whom
such payments are owed) shall be made to the Agent at the office designated by
the Agent from time to time by written notice as provided herein in Dollars and
in immediately available funds, without setoff, deduction, or counterclaim.
Subject to the definition of “Interest Period” in Appendix A attached hereto,
whenever any payment under this Agreement or any other Operative Agreements
shall be stated to be due on a day that is not a Business Day, such payment may
be made on the next succeeding Business Day, and such extension of time in such
case shall not be included in the computation of interest and fees payable
pursuant to the Operative Agreements, as applicable and as the case may be.

5.11 Amounts Due Under Lease.

Each Credit Party, the Lessor, the Agent, each Credit Lender and each Mortgage
Lender intends that, subject to the provisions of the Operative Agreements:
(i) the amount and timing of installments of Basic Rent due and payable from
time to time under the Lease shall be equal to the aggregate payments due and
payable as scheduled interest on the Credit Loans and the Mortgage Loans and the
scheduled Lessor Yield on the Lessor Advance on each Scheduled Interest Payment
Date; (ii) if the Lessee elects the Purchase Option or becomes obligated or
otherwise elects to purchase the Property under the Lease, then the Credit
Notes, the Mortgage Notes, the Lessor Advance, all accrued and unpaid interest
and Lessor Yield thereon, and all other obligations of the Credit Parties owing
to the Primary Financing Parties under the Operative Agreements shall be paid by
the Lessee with a payment of Supplemental Rent in an amount equal to the
Termination Value for the Property; and (iii) if the Lessee properly elects the
Sale Option with respect to the Property, the Lessee shall be required to pay to
the Agent the Maximum Residual Guarantee Amount on the Expiration Date, together
with all other amounts then due and payable as Supplemental Rent in respect of
the Lease.

SECTION 5B

LESSOR ADVANCE

5B.1 Procedure for Lessor Advance.

Upon receipt from Lessee by the Agent of a Requisition pursuant to Section 4.2,
and subject to the terms and conditions of this Agreement and payment by the
Lessor of the amounts described in the Assignment and Recharacterization
Agreement, the Lessor shall be deemed to have made an Advance under the Lessor
Commitment equal to $3,900,000 in such Requisition on the Closing Date. The
Lessor Advance shall be based on the Eurodollar Rate or the ABR, as designated
by the Lessee in the Requisition.

 

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5B.2 Lessor Yield.

(a) The Lessor Advance shall bear yield calculated at the rate of Lessor Yield
applicable from time to time. The Lessee shall pay as Basic Rent to the Agent
for distribution to the Lessor the Lessor Yield in arrears on each Scheduled
Interest Payment Date or as otherwise provided herein.

(b) If all or a portion of Lessor Yield shall not be received by the Lessor (or
the Agent on behalf of the Lessor) when due (whether at the stated maturity, by
acceleration or otherwise), such overdue amount shall, without limiting the
rights of the Lessor hereunder or under any other Operative Agreement, bear
interest at the Lessor Overdue Rate, in each case from the date of nonpayment
until paid (whether after or before judgment) and shall be paid upon demand.
Upon the occurrence and during the continuation of any Event of Default, Lessor
Yield shall be calculated at the Lessor Overdue Rate.

5B.3 Scheduled Return of Lessor Advance.

The outstanding amount of the Lessor Advance shall be due in full on the
Expiration Date. On the Expiration Date, subject to the terms of this Agreement,
the Lessor (or the Agent on behalf of the Lessor) shall receive from the Lessee
as Basic Rent under the Lease the outstanding amount of the Lessor Advance then
due, together with all accrued but unpaid Lessor Yield and all other amounts due
to Lessor under the Operative Agreements.

5B.4 Early Return of Lessor Advance.

(a) Subject to Section 5B.4(a) or (b) and Sections 11.2(e), 11.3 and 11.4 of
this Agreement, the Lessor Advance may at any time be prepaid by the Lessee as a
payment of Supplemental Rent, in whole or in part, without premium or penalty,
upon at least three (3) Business Days’ irrevocable notice to the Agent,
specifying the date and amount of prepayment of the Lessor Advance. Upon receipt
of such notice, the Agent shall promptly notify the Lessor thereof. If such
notice is given, the amount specified in such notice shall be due and payable on
the date specified therein. Amounts prepaid shall not be re-advanced.

(b) If on any date the Agent or the Lessor shall receive any payment in respect
of (i) any Casualty, Condemnation or Environmental Violation pursuant to
Sections 15.1(a) or 15.1(g) or Article XVI of the Lease (excluding any payments
in respect thereof which are payable to Lessee in accordance with the Lease), or
(ii) the Termination Value of the Property in connection with the delivery of a
Termination Notice pursuant to Article XVI of the Lease, or (iii) the
Termination Value of the Property or such other applicable amount in connection
with the exercise of a Purchase Option under Article XX of the Lease or the
exercise of the option of the Lessor to transfer the Property to the Lessee
pursuant to Section 20.3 of the Lease, then in each case, the Agent or the
Lessor shall receive such payment to be distributed, subject to the requirements
of Section 8.7 of this Agreement, in a manner as the Financing Parties shall
from time to time agree.

(c) Each prepayment of the Lessor Advances pursuant to Section 5B.4(a) shall be
allocated to reduce the Lessor Property Cost of the Property immediately before
giving effect to such prepayment.

(d) The Lessee shall not be permitted to prepay the Lessor Advance in accordance
with Section 5B.4(a) unless, concurrently with such prepayment, Lessee (with a
payment of

 

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Supplemental Rent) shall also cause (i) each of the Credit Loans to be prepaid
and (ii) each of the Mortgage Loans to be prepaid, in each case (including the
payment to Lessor of all or a portion of the Lessor Advance) ratably based on
such Primary Financing Party’s share of the Financing then outstanding.

5B.5 Conversion and Continuation Options.

(a) The Lessee may elect from time to time to convert Eurodollar Lessor Advances
to ABR Lessor Advances by giving the Lessor at least three (3) Business Days’
prior irrevocable notice of such election, provided, that any such conversion
may only be made on the last day of an Interest Period with respect thereto, and
provided, further, to the extent an Event of Default has occurred and is
continuing on the last day of any such Interest Period, the applicable
Eurodollar Lessor Advances shall automatically be converted to ABR Lessor
Advances. The Lessee may elect from time to time to convert ABR Lessor Advances
to Eurodollar Lessor Advances by giving the Lessor at least three (3) Business
Days’ prior irrevocable notice of such election. All or any part of outstanding
Lessor Advance may be converted as provided herein, provided, that (i) no ABR
Lessor Advance may be converted into a Eurodollar Lessor Advance after the date
that is one (1) month prior to the Expiration Date and (ii) such notice of
conversion regarding any Eurodollar Lessor Advance shall contain an election by
the Lessee of an Interest Period for such Eurodollar Lessor Advance to be
created by such conversion and such Interest Period shall be in accordance with
the terms of the definition of the term “Interest Period” including without
limitation subparagraphs (A) through (D) thereof.

(b) Each Eurodollar Lessor Advance shall automatically be continued as such upon
the expiration of the then current Interest Period with respect thereto for an
Interest Period of equal duration to the immediately preceding Interest Period,
provided, that no Eurodollar Lessor Advance may be continued as such after the
date that is one (1) month prior to the Expiration Date, provided, further, no
Eurodollar Lessor Advance may be continued as such if a Lease Event of Default
has occurred and is continuing as of the last day of the Interest Period for
such Eurodollar Lessor Advance, and provided, further, if any continuation is
not permitted pursuant to the preceding provisos, such Eurodollar Lessor Advance
shall automatically be converted to an ABR Lessor Advance on the last day of
such then expiring Interest Period.

5B.6 Computation of Lessor Yield.

(a) Lessor Yield shall be calculated on the basis of a year of three hundred
sixty (360) days for the actual days elapsed. Any change in the Lessor Yield
resulting from a change in the Eurodollar Reserve Percentage shall become
effective as of the opening of business on the day on which such change becomes
effective.

(b) Pursuant to Section 12.12 of this Agreement, the calculation of Lessor Yield
under this Section 5B.6 shall be made by the Agent. Each determination of Lessor
Yield by the Agent shall be conclusive and binding in the absence of manifest
error.

(c) If the Eurodollar Rate cannot be determined by the Agent in the manner
specified in the definition of the term “Eurodollar Rate”, then commencing on
the Scheduled Interest Payment Date next occurring and continuing until such
time as the Eurodollar Rate can be determined by the Agent in the manner
specified in the definition of such term, the outstanding Lessor Advance shall
bear a yield based on the ABR.

 

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SECTION 6

REPRESENTATIONS AND WARRANTIES

6.1 Representations and Warranties of the Borrower.

The Borrower represents and warrants to each of the other parties hereto that as
of the Closing Date (except to the extent any such representation or warranty
relates to an earlier date):

(a) It is a corporation duly organized and validly existing and in good standing
under the laws of the State of North Carolina, is qualified to do business in
each jurisdiction necessary to permit the Borrower to own and lease the Property
and perform its obligations under each of the Operative Agreements and has the
power and authority to enter into and perform its obligations under each of the
Operative Agreements to which it is or will be a party and each other agreement,
instrument and document to be executed and delivered by it on or before such
Closing Date in connection with or as contemplated by each such Operative
Agreement to which the Borrower is or will be a party. Lessor is a
multi-purpose, Wholly-Owned Entity of Wells Fargo & Company;

(b) The execution, delivery and performance of each Operative Agreement to which
it is or will be a party has been duly authorized by all necessary action on its
part and neither the execution and delivery thereof, nor the consummation of the
transactions contemplated thereby, nor compliance by it with any of the terms
and provisions thereof (i) does or will require any approval or consent of any
trustee or holders of any of its indebtedness or obligations or any other
consent or approval that has not previously been obtained, (ii) does or will
contravene any Legal Requirement, (iii) does or will contravene or result in any
breach of or constitute any default under, or result in the creation of any Lien
upon any of its property under, (A) its charter or by-laws, or (B) any
indenture, mortgage, chattel mortgage, deed of trust, conditional sales
contract, bank loan or credit agreement or other agreement or instrument to
which it is a party or by which it or its properties may be bound or affected,
which contravention, breach, default or Lien under clause (B) could reasonably
be expected to materially and adversely affect its ability to perform its
obligations under the Operative Agreements to which it is a party or would
question the validity or enforceability of any of the Operative Agreements to
which it is or will become a party or (iv) does or will require any Governmental
Action by any Governmental Authority;

(c) Each Operative Agreement to which the Borrower is or will be a party have
been, or on or before such Closing Date will be, duly executed and delivered by
the Borrower, and each Operative Agreement to which the Borrower is a party
constitutes, or upon execution and delivery will constitute, a legal, valid and
binding obligation enforceable against the Borrower in accordance with the terms
thereof;

(d) There is no action or proceeding pending or, to its knowledge, threatened to
which it is or will be a party before any Governmental Authority that, if
adversely determined, would materially and adversely affect its ability to
perform its obligations under the Operative Agreements to which it is a party or
would question the validity or enforceability of any of the Operative Agreements
to which it is or will become a party;

(e) The Borrower has not assigned or transferred any of its right, title or
interest in or under the Lease or its interest in the Property or any portion
thereof, except in accordance with the Operative Agreements;

 

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(f) No Default or Event of Default under the Operative Agreements attributable
to it has occurred and is continuing;

(g) Except as otherwise contemplated in the Operative Agreements, the proceeds
of the Advance shall not be applied by the Borrower for any purpose other than
as described in Section 1 of this Agreement;

(h) Neither the Borrower nor any Person authorized by the Borrower to act on its
behalf has offered or sold any interest in the Borrower’s Interest or the Notes,
or in any similar security relating to the Property, or in any security the
offering of which for the purposes of the Securities Act would be deemed to be
part of the same offering as the offering of the aforementioned securities to,
or solicited any offer to acquire any of the same from, any Person other than
the Credit Lenders and Mortgage Lenders identified and contacted by the Agent
and seventy-five (75) other institutional investors and neither the Borrower nor
any Person authorized by the Borrower to act on its behalf will take any action
which would subject, as a direct result of such action alone, the issuance or
sale of any interest in the Borrower’s Interest or the Notes to the provisions
of Section 5 of the Securities Act or require the qualification of any Operative
Agreement under the Trust Indenture Act of 1939, as amended;

(i) The location of the Borrower for purposes of the UCC is North Carolina. The
Borrower’s principal place of business, chief executive office and office where
the documents, accounts and records relating to the transactions contemplated by
this Agreement and each other Operative Agreement are kept are located at
301 South College Street, Charlotte, North Carolina 28288;

(j) The Borrower is not engaged principally in, and does not have as one (1) of
its important activities, the business of extending credit for the purpose of
purchasing or carrying any margin stock (within the meaning of Regulation U),
and no part of the proceeds from the Credit Loans, the Mortgage Loans or the
Lessor Advance will be used by it to purchase or carry any margin stock or to
extend credit to others for the purpose of purchasing or carrying any such
margin stock or for any purpose that violates, or is inconsistent with, the
provisions of Regulations T, U, or X;

(k) The Borrower is not an “investment company” or a company controlled by an
“investment company” within the meaning of the Investment Company Act;

(l) The Property is free and clear of all Lessor Liens attributable to the
Lessor;

(m) The Borrower’s true legal name as registered in the jurisdiction of its
organization is “Wachovia Development Corporation” and its Federal Employer
Identification Number is 56-1610288. During the five (5) year period immediately
prior to the Closing Date, the true legal name of the Borrower has not been
other than “Wachovia Development Corporation” or “First Union Development
Corporation”. The Borrower does not use, or transact and has not used, or
transacted within the five (5) years immediately prior to the Closing Date any
business under, any trade name other than its current or prior legal name
referenced in the preceding sentence;

(n) The Borrower has filed all tax returns and all other material reports that
are required under applicable Law to be filed by them and has paid all taxes or
other charges of any Governmental Authority due pursuant to such returns or
other reports, except for any taxes or other charges that are being diligently
contested in good faith by appropriate proceedings and for which adequate
reserves have been set aside on the books and records of the Borrower;

 

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(o) No more than 95% non-recourse debt was used to finance the Borrower’s
acquisition of the Property, with the remainder of the Property Cost financed
with either non-targeted equity or recourse debt;

(p) The fair market value of the Property (based on the Appraisal) represents
less than 50% of the fair market value of the total assets of the Borrower; and

(q) Lessor’s financial statements are consolidated with the financial statements
of Wells Fargo & Company.

6.2 Representations and Warranties of the Credit Parties.

Each Credit Party represents and warrants to each of the other parties hereto
that as of the Closing Date (except to the extent that any such representation
or warranty relates to an earlier date):

(a) Each of the Lessee and its Subsidiaries is duly organized, validly existing
and, except for the matter set forth in Schedule 6.2(a), in good standing under
the laws of the jurisdiction of its organization, has all requisite power and
authority to carry on its business as now conducted and, except where the
failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, is qualified to do business in,
and is in good standing in, every jurisdiction where such qualification is
required.

(b) The Transactions are within the Lessee’s or Guarantor’s, as the case may be,
corporate powers and have been duly authorized by all necessary corporate and,
if required, stockholder action. Each of the Operative Agreements (to which the
Lessee or any Guarantor is a party) has been duly executed and delivered by the
Lessee or the Guarantors, as applicable, and constitutes a legal, valid and
binding obligation of the Lessee or the Guarantors, as applicable, enforceable
in accordance with its terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium or other laws affecting creditors’ rights generally
and subject to general principles of equity, regardless of whether considered in
a proceeding in equity or at law.

(c) The Transactions (i) do not require any consent or approval of, registration
or filing with, or any other action by, any Governmental Authority, except such
as have been obtained or made and are in full force and effect, (ii) will not
violate any applicable law or regulation or the charter, by-laws or other
organizational documents of the Lessee or any of its Subsidiaries or any order
of any Governmental Authority, (iii) will not violate or result in a default
under any indenture, agreement or other instrument binding upon the Lessee or
any of its Subsidiaries or its assets, or give rise to a right thereunder to
require any payment to be made by the Lessee or any of its Subsidiaries, and
(iv) will not result in the creation or imposition of any Lien on any asset of
the Lessee or any of its Subsidiaries.

(d)(i) The Lessee has heretofore furnished to the Lessor and the Lenders its
consolidated balance sheet and statements of income, stockholders equity and
cash flows (A) as of and for the fiscal year ended December 31, 2009, reported
on by Ernst & Young LLP, independent public accountants, and (B) as of and for
the fiscal quarter and the portion of the fiscal year ended March 31, 2010,
certified by its chief financial officer. Such financial statements present
fairly, in all material respects, the financial position and results of
operations and cash flows of the Lessee and its consolidated Subsidiaries as of

 

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such dates and for such periods in accordance with GAAP, subject to year-end
audit adjustments and the absence of footnotes in the case of the statements
referred to in clause (B) above.

(ii) Since December 31, 2009, there has been no event, occurrence or other
matter that could reasonably be expected, individually or in the aggregate, to
result in a Material Adverse Effect.

(e)(i) Each of the Lessee and its Subsidiaries has good title to, or valid
leasehold interests in, all its real and personal property material to its
business, except for minor defects in title that do not interfere with its
ability to conduct its business as currently conducted or to utilize such
properties for their intended purposes.

(ii) Each of the Lessee and its Subsidiaries owns, or is licensed to use, all
trademarks, tradenames, copyrights, patents and other intellectual property
material to its business, and the use thereof by the Lessee 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.

(f)(i) There are no actions, suits or proceedings by or before any arbitrator or
Governmental Authority pending against or, to the knowledge of the Lessee,
threatened against or affecting the Lessee or any of its Subsidiaries (A) as to
which there is a reasonable possibility of an adverse determination and that, if
adversely determined, could reasonably be expected, individually or in the
aggregate, to result in a Material Adverse Effect (other than the Disclosed
Matters) or (B) that involve any of the Operative Agreements or the
Transactions.

(ii) Except for the Disclosed Matters and except with respect to any other
matters that, individually or in the aggregate, could not reasonably be expected
to result in a Material Adverse Effect, neither the Lessee nor any of its
Subsidiaries (A) has failed to comply with any Environmental Law or to obtain,
maintain or comply with any permit, license or other approval required under any
Environmental Law, (B) has become subject to any Environmental Liability,
(C) has received notice of any claim with respect to any Environmental Liability
or (D) knows of any basis for any Environmental Liability.

(iii) Since the date of this Agreement, there has been no change in the status
of the Disclosed Matters that, individually or in the aggregate, has resulted
in, or materially increased the likelihood of, a Material Adverse Effect.

(g) The Lessee and each Subsidiary is in compliance with all laws, regulations
and orders of any Governmental Authority applicable to it or its property and
all indentures, agreements and other instruments binding upon it or its
property, except where the failure to do so, individually or in the aggregate,
could not reasonably be expected to result in a Material Adverse Effect. No
Lease Default or Lease Event of Default has occurred and is continuing.

(h) Neither the Lessee nor any of its Subsidiaries is an “investment company” as
defined in, or subject to regulation under, the Investment Company Act of 1940.

(i) The Lessee and each Subsidiary has timely filed or caused to be filed all
Tax returns and reports required to have been filed and has paid or caused to be
paid all Taxes required to have been paid by it, except (a) Taxes that are being
contested in good faith by

 

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appropriate proceedings and for which the Lessee or such Subsidiary, as
applicable, has set aside on its books adequate reserves in accordance with GAAP
and (b) to the extent that the failure to do so could not reasonably be expected
to result in a Material Adverse Effect.

(j) No ERISA Event has occurred or is reasonably expected to occur that, when
taken together with all other such ERISA Events for which liability is
reasonably expected to occur, could reasonably be expected to result in a
Material Adverse Effect. The present value of all accumulated benefit
obligations of all underfunded Plans (based on the assumptions used for purposes
of Statement of Financial Accounting Standards No. 87) did not, as of the end of
the most recent fiscal period for which financial statements have been delivered
pursuant to Section 8.3A.1(a) or (b), exceed by more than $125,000,000 the fair
market value of the assets of all such underfunded Plans.

(k) Neither the Information Memorandum nor any of the other reports, financial
statements, certificates or other information furnished by or on behalf of the
Lessee to the Agent, the Lessor or any Lender in connection with the negotiation
of the Operative Agreements or delivered hereunder (as modified or supplemented
by other information so furnished) contains any material misstatement of fact or
omits to state any material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, when taken as a
whole, not misleading; provided that, with respect to projected financial
information, the Lessee represents only that such information was prepared in
good faith based upon assumptions believed to be reasonable at the time.

(l) Neither the Lessee nor any Subsidiary is engaged principally, or as one of
its important activities, in the business of extending credit for the purpose,
whether immediate, incidental or ultimate, of buying or carrying margin stock
(within the meaning of Regulation T, U or X of the Board). No part of the
proceeds of the Lessor Advance or any Loan will be used, whether directly or
indirectly, for any purpose that entails a violation of any of the Regulations
of the Board, including Regulations T, U and X.

(m) Schedule 6.2(m) contains an accurate list of all Material Subsidiaries on
the date hereof, setting forth their respective jurisdictions of organization
and the percentage of their respective ownership interest held by the Lessee or
other Subsidiaries. All of the issued and outstanding shares of capital stock of
the Material Subsidiaries have been duly authorized and issued and are fully
paid and non-assessable.

(n) None of the Lessee or any Subsidiary nor, to the knowledge of the Lessee,
any director, officer, agent, employee or Affiliate of the Lessee or any
Subsidiary is currently subject to any U.S. sanctions administered by the Office
of Foreign Assets Control of the U.S. Treasury Department (“OFAC”); and the
Lessee will not directly or indirectly use the proceeds of the Lessor Advance
and the Loans or otherwise make available such proceeds to any Person for the
purpose of financing the activities of any Person currently subject to any U.S.
sanctions administered by OFAC.

(o) The principal place of business, chief executive office, location for
purposes of the UCC and office of the Lessee where the documents, accounts and
records relating to the transactions contemplated by this Agreement and each
other Operative Agreement are kept are located at 201 East Fourth Street,
Cincinnati, Hamilton County, Ohio 45202, and the states of formation, location
for purposes of the UCC and the chief executive offices of each other Credit
Party are located at the places set forth in Exhibit L;

 

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(p) The representations and warranties of each Credit Party set forth in any of
the Operative Agreements are true and correct in all material respects on and as
of each such date as if made on and as of such date. Each Credit Party is in all
material respects in compliance with its obligations under the Operative
Agreements and there exists no Lease Default or Lease Event of Default under any
of the Operative Agreements which is continuing and which has not been cured
within any cure period expressly granted under the terms of the applicable
Operative Agreement or otherwise waived in accordance with the applicable
Operative Agreement. No Lease Default or Lease Event of Default will occur under
any of the Operative Agreements as a result of, or after giving effect to, the
Advance requested by the Requisition on the Closing Date;

(q) Lessor has good and marketable fee simple title to the Property, or, if any
portion of the Property is the subject of a Ground Lease, the Lessor will have a
valid ground leasehold interest enforceable against the ground lessor of such
portion of the Property in accordance with the terms of such Ground Lease,
subject only to (i) Liens that are expressly set forth as title exceptions on
the title insurance policies with endorsements thereto issued in accordance with
Section 5.3(g) with respect to the Property on the Closing Date and (ii) subject
to Section 5.7, Permitted Liens after the Closing Date;

(r) No portion of the Property is located in an area identified as a special
flood hazard area by the Federal Emergency Management Agency or other applicable
agency, or if the Property is located in an area identified as a special flood
hazard area by the Federal Emergency Management Agency or other applicable
agency, then flood insurance has been obtained for the Property in accordance
with Section 14.2(b) of the Lease and in accordance with the National Flood
Insurance Act of 1968, as amended;

(s) The Property complies with all Insurance Requirements and all standards of
Lessee with respect to similar properties owned by Lessee;

(t) The Property complies with all Legal Requirements as of such date (including
without limitation all zoning and land use laws and Environmental Laws), except
to the extent that failure to comply therewith, individually or in the
aggregate, shall not have and could not reasonably be expected to have a
Material Adverse Effect;

(u)(i) The Security Documents create, as security for the Obligations (as such
term is defined in the Security Agreement), valid and enforceable security
interests in, and Liens on, all of the Collateral, in favor of the Agent, for
the benefit of the Secured Parties and such security interests and Liens are
subject to no other Liens other than Liens that are expressly set forth as title
exceptions on the title insurance policies with endorsements thereto issued in
accordance with Section 5.3(g) with respect to the Property; and

(ii) The Lease Agreement creates, as security for the obligations of the Lessee
under the Lease Agreement, valid and enforceable security interests in, and
Liens on, the Property leased thereunder, in favor of the Lessor, and such
security interests and Liens are subject to no other Liens other than Liens that
are expressly set forth as title exceptions on the title insurance policies with
endorsements thereto issued in accordance with Section 5.3(g) with respect to
the Property;

 

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(v) Except as otherwise could not reasonably be expected to have a Material
Adverse Effect, to the knowledge of the Credit Parties:

(i) The Property (including soils, surface waters, groundwaters on, at or under
the Property) neither contains nor is otherwise affected by, and to Lessee’s
knowledge has not previously contained or been affected by, any Hazardous
Substance in amounts or concentrations which (A) constitute or constituted a
violation of applicable Environmental Laws or (B) could give rise to liability
or obligation under applicable Environmental Laws;

(ii) The Property and all operations conducted in connection therewith are in
compliance, and have been in compliance, with all applicable Environmental Laws,
and there are no Hazardous Substances at, under or about the Property or such
operations which could reasonably be expected to interfere with the continued
operation of the Property;

(iii) Lessee and all Subsidiaries of Lessee have obtained, are in compliance
with, and have made all appropriate filings for issuance or renewal of, all
environmental permits with respect to the Property, and all such environmental
permits are in full force and effect;

(iv) Neither Lessee nor any Subsidiary thereof has received any notice of
violation, alleged violation, noncompliance, liability or potential liability
regarding environmental matters or compliance with Environmental Laws, in each
case, with respect to the Property, nor does Lessee have knowledge or reason to
believe that any such notice will be received or is being threatened;

(v) Hazardous Substances have not been transported or disposed of from the
Property in violation of, or in a manner or to a location which could reasonably
be expected to give rise to liability under, applicable Environmental Laws, nor
have any Hazardous Substances been generated, treated, stored or disposed of at,
on or under the Property in violation of, or in a manner which could reasonably
be expected to give rise to liability under, any applicable Environmental Laws;

(vi) No judicial proceedings or governmental or administrative action is
pending, or threatened, under any applicable Environmental Law with respect to
the Property to which Lessee or any Subsidiary thereof has been or will be named
as a party, nor are there any consent decrees or other decrees, consent orders,
administrative orders or other orders, or other administrative or judicial
requirements outstanding under any applicable Environmental Law with respect to
the Property;

(vii) There has been no release, or threat of release, of Hazardous Substances
at or from the Property, in violation of or in amounts or in a manner that could
reasonably be expected to give rise to liability under applicable Environmental
Laws; and

(viii) Neither Lessee nor any Subsidiary of Lessee (A) has failed to comply with
any applicable Environmental Law or to obtain, maintain or comply with any
applicable permit, license or other approval required under any applicable
Environmental Law or (B) has become subject to any Environmental Law or (C) has
become subject to any Environmental Claim;

 

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(w) Neither the Lessee nor anyone authorized to act on the Lessee’s behalf has,
directly or indirectly, solicited any offers to acquire, offered or sold:
(i) any interest in the Property, the Lease or the Operative Agreements in
violation of Section 5 of the Securities Act or any state securities laws, or
(ii) any interest in any security or lease the offering of which, for purposes
of the Securities Act or any state securities laws, would be deemed to be part
of the same offering as the offering of the aforementioned interests. Neither
the Lessee nor anyone authorized to act on its behalf was involved in selling
Notes (or any similar securities) to any Person other than the Credit Lenders
and Mortgage Lenders identified and contacted by the Agent and seventy-five
(75) other institutional investors;

(x) The true legal name of the Lessee as registered in the jurisdiction of its
organization is and has been for at least five (5) years or, if less, since its
formation “Convergys Corporation” and its Federal Employer Identification number
is 31-1598292. The Lessee does not use or transact, and has not used or
transacted within the five (5) years immediately prior to the Closing Date or,
if less, since its formation, any business under any trade name other than its
legal name; and

(y) The outstanding balance of the Property Cost on the Closing Date does not
exceed the fair market value of the Property, based on the Appraisal.

SECTION 6B

GUARANTY

6B.1 Guaranty of Payment and Performance.

Subject to Section 6B.7, each Guarantor hereby, jointly and severally,
absolutely, irrevocably and unconditionally guarantees to each Financing Party
the prompt payment and performance of the Company Obligations in full when due
(whether at stated maturity, as a mandatory prepayment, by acceleration or
otherwise) or when such is otherwise to be performed; provided, notwithstanding
the foregoing, the obligations of the Guarantors under this Section 6B shall not
constitute a direct guaranty of the indebtedness of the Borrower evidenced by
the Notes but rather a guaranty of the Company Obligations arising under the
Operative Agreements. This Section 6B is a guaranty of payment and performance
and not of collection and is a continuing guaranty and shall apply to all
Company Obligations whenever arising. All rights granted to the Financing
Parties under this Section 6B shall be subject to the provisions of
Section 8.2(d) and 8.6.

6B.2 Obligations Unconditional.

Each Guarantor agrees that the obligations of the Guarantors hereunder are
absolute and unconditional, irrespective of the value, genuineness, validity,
regularity or enforceability of any of the Operative Agreements, or any other
agreement or instrument referred to therein, or any substitution, release or
exchange of any other guarantee of or security for any of the Company
Obligations, and, to the fullest extent permitted by applicable law,
irrespective of any other circumstance whatsoever which might otherwise
constitute a legal or equitable discharge or defense of a surety, guarantor or
co-obligor, it being the intent of this Section 6B.2 that the obligations of the
Guarantors hereunder shall be absolute and unconditional under any and all
circumstances. Each Guarantor agrees that this Section 6B may be enforced by the
Financing Parties without the necessity at any time of resorting to or
exhausting any other security or collateral and without the necessity at any
time of having recourse to the Notes or any other of the Operative Agreements or
any collateral, if any, hereafter securing the Company Obligations or otherwise
and each Guarantor hereby waives the right to require the Financing Parties to
proceed against

 

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the Lessee or any other Person (including without limitation a co-guarantor) or
to require the Financing Parties to pursue any other remedy or enforce any other
right. Each Guarantor further agrees that it hereby waives any and all right of
subrogation, indemnity, reimbursement or contribution against the Lessee or any
other Guarantor of the Company Obligations for amounts paid under this
Section 6B until such time as the Credit Notes, the Mortgage Notes, the Lessor
Advance, accrued but unpaid interest, accrued but unpaid Lessor Yield and all
other amounts owing under the Operative Agreements have been paid in full.
Without limiting the generality of the waiver provisions of this Section 6B,
each Guarantor hereby waives any rights to require the Financing Parties to
proceed against the Lessee or any co-guarantor or to require Lessor to pursue
any other remedy or enforce any other right, including without limitation, any
and all rights under N.C. Gen. Stat. § 26-7 through 26-9. Each Guarantor further
agrees that nothing contained herein shall prevent the Financing Parties from
suing on any Operative Agreement or foreclosing any security interest in or Lien
on any collateral, if any, securing the Company Obligations or from exercising
any other rights available to it under any Operative Agreement, or any other
instrument of security, if any, and the exercise of any of the aforesaid rights
and the completion of any foreclosure proceedings shall not constitute a
discharge of any Guarantor’s obligations hereunder; it being the purpose and
intent of each Guarantor that its obligations hereunder shall be absolute,
irrevocable and unconditional under any and all circumstances; provided that any
amounts due under this Section 6B which are paid to or for the benefit of any
Financing Party shall reduce the Company Obligations by a corresponding amount
(unless required to be rescinded at a later date). Neither any Guarantor’s
obligations under this Section 6B nor any remedy for the enforcement thereof
shall be impaired, modified, changed or released in any manner whatsoever by an
impairment, modification, change, release or limitation of the liability of the
Lessee or by reason of the bankruptcy or insolvency of the Lessee. Each
Guarantor waives any and all notice of the creation, renewal, extension or
accrual of any of the Company Obligations and notice of or proof of reliance by
any Financing Party upon this Section 6B or acceptance of this Section 6B. The
Company Obligations shall conclusively be deemed to have been created,
contracted or incurred, or renewed, extended, amended or waived, in reliance
upon this Section 6B. All dealings between the Lessee and any of the Guarantors,
on the one hand, and the Financing Parties, on the other hand, likewise shall be
conclusively presumed to have been had or consummated in reliance upon this
Section 6B.

6B.3 Modifications.

Each Guarantor agrees that (a) all or any part of the security now or hereafter
held for the Company Obligations, if any, may be exchanged, compromised or
surrendered from time to time; (b) no Financing Party shall have any obligation
to protect, perfect, secure or insure any such security interests, liens or
encumbrances now or hereafter held, if any, for the Company Obligations or the
properties subject thereto; (c) the time or place of payment of the Company
Obligations may be changed or extended, in whole or in part, to a time certain
or otherwise, and may be renewed or accelerated, in whole or in part; (d) the
Lessee and any other party liable for payment under the Operative Agreements may
be granted indulgences generally; (e) any of the provisions of the Notes or any
of the other Operative Agreements may be modified, amended or waived; (f) any
party (including any co-guarantor) liable for the payment thereof may be granted
indulgences or be released; and (g) any deposit balance for the credit of the
Lessee or any other party liable for the payment of the Company Obligations or
liable upon any security therefor may be released, in whole or in part, at,
before or after the stated, extended or accelerated maturity of the Company
Obligations, all without notice to or further assent by such Guarantor, which
shall remain bound thereon, notwithstanding any such exchange, compromise,
surrender, extension, renewal, acceleration, modification, indulgence or
release.

 

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6B.4 Waiver of Rights.

Each Guarantor expressly waives to the fullest extent permitted by applicable
law: (a) notice of acceptance of this Section 6B by any Financing Party and of
all extensions of credit or other Advances by the Lessor, the Credit Lenders and
the Mortgage Lenders pursuant to the terms of the Operative Agreements;
(b) presentment and demand for payment or performance of any of the Company
Obligations; (c) protest and notice of dishonor or of default with respect to
the Company Obligations or with respect to any security therefor; (d) notice of
any Financing Party obtaining, amending, substituting for, releasing, waiving or
modifying any security interest, lien or encumbrance, if any, hereafter securing
the Company Obligations, or any Financing Party’s subordinating, compromising,
discharging or releasing such security interests, liens or encumbrances, if any;
and (e) all other notices to which such Guarantor might otherwise be entitled.
Notwithstanding anything to the contrary herein, each Guarantor’s payments
hereunder shall be due ten (10) Business Days after written demand by the Agent
for such payment (unless the Company Obligations are automatically accelerated
pursuant to the applicable provisions of the Operative Agreements in which case
the Guarantors’ payments shall be automatically due).

6B.5 Reinstatement.

The obligations of the Guarantors under this Section 6B shall be automatically
reinstated if and to the extent that for any reason any payment by or on behalf
of any Person in respect of the Company Obligations is rescinded or must be
otherwise restored by any holder of any of the Company Obligations, whether as a
result of any proceedings in bankruptcy or reorganization or otherwise, and each
Guarantor agrees that it will indemnify each Financing Party on demand for all
reasonable costs and expenses (including, without limitation, reasonable fees of
counsel) incurred by any Financing Party in connection with such rescission or
restoration, including without limitation any such costs and expenses incurred
in defending against any claim alleging that such payment constituted a
preference, fraudulent transfer or similar payment under any bankruptcy,
insolvency or similar law.

6B.6 Remedies.

The Guarantors agree that, as between the Guarantors, on the one hand, and each
Financing Party, on the other hand, the Company Obligations may be declared to
be forthwith due and payable as provided in the applicable provisions of the
Operative Agreements (and shall be deemed to have become automatically due and
payable in the circumstances provided therein) notwithstanding any stay,
injunction or other prohibition preventing such declaration (or preventing such
Company Obligations from becoming automatically due and payable) as against any
other Person and that, in the event of such declaration (or such Company
Obligations being deemed to have become automatically due and payable), such
Company Obligations (whether or not due and payable by any other Person) shall
forthwith become due and payable by the Guarantors in accordance with the
applicable provisions of the Operative Agreements.

6B.7 Limitation of Guaranty.

Notwithstanding any provision to the contrary contained herein or in any of the
other Operative Agreements, to the extent the obligations of any Guarantor shall
be adjudicated to be invalid or unenforceable for any reason (including without
limitation because of any applicable state or federal law relating to fraudulent
conveyances or transfers) then the obligations of such Guarantor hereunder shall
be limited to the maximum amount that is permissible under applicable law
(whether federal or state and including without limitation the Bankruptcy Code).

 

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Subject to Section 6B.5, upon the satisfaction of the Company Obligations in
full, regardless of the source of payment, the Guarantors’ obligations hereunder
shall be deemed satisfied, discharged and terminated other than indemnifications
set forth herein that expressly survive.

6B.8 Contribution.

To the extent of any payments made under this Section 6B, each Guarantor making
such payment shall have a right of contribution from the other Guarantors, but
such Guarantor covenants and agrees that such right of contribution shall be
subordinate in right of payment to the rights of the Financing Parties for which
full payment has not been made or provided for and, to that end, such Guarantor
agrees not to claim or enforce any such right of contribution unless and until
all of the Credit Notes, the Mortgage Notes, the Lessor Advance, accrued but
unpaid interest, accrued but unpaid Lessor Yield and all other amounts owing
under the Operative Agreements have been irrevocably paid and discharged.

6B.9 Payment of Amounts to the Agent.

Each Financing Party hereby instructs each Guarantor, and each Guarantor hereby
acknowledges and agrees, that until such time as the Credit Notes, the Mortgage
Notes and the Lessor Advance are paid in full and the Liens evidenced by the
Security Agreement and the Mortgage Instruments have been released any and all
Rent (excluding Excepted Payments which shall be payable to each Person as
appropriate) and any and all other amounts of any kind or type under any of the
Operative Agreements due and owing or payable to any Person shall instead be
paid directly to the Agent (excluding Excepted Payments which shall be payable
to each Person as appropriate) or as the Agent may direct from time to time for
allocation and distribution in accordance with the procedures set forth in
Section 8.7 hereof.

6B.10 Release of Guarantors.

Each Financing Party hereby agrees that (a) the Agent shall be permitted to
release any Guarantor from its guaranty obligations under this Section 6B
without the consent of any other Financing Party if the release is granted in
connection with a disposition by the applicable Credit Party of all the shares
of stock or partnership or other equity interest in such Guarantor and such
disposition is permitted pursuant to the applicable provisions of the Operative
Agreements and (b) the Agent shall be permitted to release any Guarantor from
its guaranty obligations under this Section 6B.10 without the consent of any
other Financing Party if the release is requested by the Lessee in connection
with a dissolution of the Guarantor, subject to the Lessee providing to the
Agent written representations to the effect that such Guarantor has no business
operations and no assets.

SECTION 7

PAYMENT OF CERTAIN EXPENSES

7.1 Transaction Expenses.

The Lessee agrees on the Closing Date, to pay, or cause to be paid, all
Transaction Expenses arising from the transactions consummated on the Closing
Date, including without limitation all reasonable fees, expenses and
disbursements of Moore & Van Allen, PLLC, as counsel for the Agent, the Credit
Lenders, the Mortgage Lenders and the Lessor, and the initial fees and expenses
of the Credit Lenders, the Mortgage Lenders, the Lessor and the Agent due and
payable on the Closing Date, all fees, taxes and expenses for the recording,
registration and filing of documents and all other reasonable fees, expenses and
disbursements incurred in connection with the Closing Date.

 

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7.2 Brokers’ Fees.

The Lessee agrees to pay or cause to be paid any and all brokers’ fees, if any,
including without limitation any interest and penalties thereon, which are
payable in connection with the transactions contemplated by this Agreement and
the other Operative Agreements, excluding the fees of any brokers retained by
the Agent, the Lessor, any other Primary Financing Party, or any Affiliate of
any of the foregoing.

7.3 Certain Fees and Expenses.

The Lessee agrees to pay or cause to be paid (a) all reasonable expenses of the
Lessor (including without limitation reasonable counsel fees and expenses)
incurred in connection with, or which arises under, the Operative Agreements;
(b) all reasonable costs and expenses incurred by the Lessee, the Agent or any
Primary Financing Party in entering into any Lease Supplement and any future
amendments, modifications, supplements, restatements and/or replacements with
respect to any of the Operative Agreements, whether or not such Lease
Supplement, amendments, modifications, supplements, restatements and/or
replacements are ultimately entered into, or giving or withholding of waivers of
consents hereto or thereto, which have been requested by the Lessee, the Agent
or any Primary Financing Party; (c) all reasonable costs and expenses incurred
by the Lessee, the Agent or any Primary Financing Party in connection with any
exercise of remedies under any Operative Agreement or any purchase of the
Property by the Lessee or any third party; and (d) all reasonable costs and
expenses incurred by the Lessee, the Agent or any Primary Financing Party in
connection with any transfer or conveyance of the Property, whether or not such
transfer or conveyance is ultimately accomplished.

7.4 [Reserved].

7.5 Administrative Fee.

The Lessee shall pay or cause to be paid an administrative fee to the Agent (for
its individual account) on the terms and conditions set forth in that certain
engagement letter dated June 25, 2010 (as amended, modified, extended,
supplemented, restated and/or replaced from time to time, the “Engagement
Letter”) regarding the lease financing addressed to the Lessee (to the attention
of Mr. David Wiedwald of the Lessee) from Wells Fargo Securities, LLC (executed
by Mr. Weston Garrett of Wells Fargo Securities, LLC.

7.6 Arrangement Fee.

The Lessee shall pay or cause to be paid an arrangement fee to Wells Fargo
Securities, LLC (for its individual account) on the terms and conditions set
forth in the Engagement Letter.

7.7 Up-Front Fee.

The Lessee shall pay or cause to be paid an up-front fee to the Agent (for the
account of the Lenders and the Lessor) on the terms and conditions set forth in
the Engagement Letter.

 

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SECTION 8

OTHER COVENANTS AND AGREEMENTS

8.1 Cooperation with the Lessee.

The Primary Financing Parties and the Agent shall, at the expense of and to the
extent reasonably requested by the Lessee (but without assuming additional
liabilities on account thereof and only to the extent such is acceptable to the
Primary Financing Parties and/or the Agent , as applicable, in their reasonable
discretion), cooperate with the Lessee in connection with the Lessee satisfying
its covenant obligations contained in the Operative Agreements including without
limitation at any time and from time to time, promptly and duly executing and
delivering any and all such further instruments, documents and financing
statements (and continuation statements related thereto).

8.2 Covenants of the Lessor.

The Lessor hereby agrees that so long as this Agreement is in effect:

(a) The Lessor will not create or permit to exist at any time, and will, at its
own cost and expense, promptly take such action as may be necessary duly to
discharge, or to cause to be discharged, all Lessor Liens on the Property
attributable to it; provided, however, that the Lessor shall not be required to
so discharge any such Lessor Lien while the same is being contested in good
faith by appropriate proceedings diligently prosecuted so long as such
proceedings shall not materially and adversely affect the rights of the Lessee
under the Lease and the other Operative Agreements or involve any material
danger of impairment of the Liens of the Security Documents or of the sale,
forfeiture or loss of, and shall not interfere with the use or disposition of,
the Property or title thereto or any interest therein or the payment of Rent;

(b) The Lessor shall not (i) commence any case, proceeding or other action under
any existing or future law of any jurisdiction, domestic or foreign, relating to
bankruptcy, insolvency, reorganization, arrangement, winding-up, liquidation,
dissolution, composition or other relief with respect to it or its debts, or
(ii) seek appointment of a receiver, trustee, custodian or other similar
official for all or any substantial benefit of the creditors of the Lessor; and
the Lessor shall not take any action in furtherance of, or indicating its
consent to, approval of, or acquiescence in, any of the acts set forth in this
paragraph;

(c) The Lessor shall give prompt written notice to the Lessee, the Primary
Financing Parties (other than the Lessor) and the Agent if the Lessor’s location
for purposes of the UCC shall cease to be North Carolina, or if the Lessor’s
principal place of business or chief executive office, or the office where the
records concerning the accounts or contract rights relating to the Property are
kept, shall cease to be located at 301 South College Street, Charlotte, North
Carolina 28288;

(d) The Lessor shall take or refrain from taking such actions and grant or
refrain from granting such approvals with respect to the Operative Agreements
and/or relating to the Property in each case as directed in writing by the Agent
(until such time as the Financing is paid in full) or, in connection with
Section 8.5 hereof, the Lessee; provided, however, that notwithstanding the
foregoing provisions of this subparagraph (d) the Lessor, the Agent and each of
the other Primary Financing Parties each acknowledge, covenant and agree that
neither the Lessor nor the Agent shall act or refrain from acting except in
accordance with the provisions of any intercreditor agreement among such
Persons; provided, further, that each of the Agent, the Primary Financing
Parties (other than the Lessor) and the Lessee acknowledges, covenants and
agrees that the Lessor will not be obligated to comply with any instruction to
take any action in violation of the terms of any Operative Agreement; and

 

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(e) The Lessor shall give the Lessee prompt written notice (a “Lessor Notice”)
following the Lessor’s knowledge, but in any event promptly upon receipt by it
of (x) notice from an acquiring Person as provided in the related underlying
transaction documents that a disposition of property will occur or (y) an
appraisal or other form of written valuation study, in either case that, in the
exercise of the Lessor’s reasonable judgment, would (regarding the Fair Market
Sales Value of the Property as set forth in the Appraisal delivered pursuant to
Section 5.3(s)), in the case of clause (x) above, cause such Fair Market Sales
Value of the Property to exceed fifty percent (50%) of (or, in the case of
clause (y) above, provide the Lessor with adequate information to determine
that, such Fair Market Sales Value of the Property exceeds fifty percent
(50%) of) the fair market value (based on appraisals or other information in the
Lessor’s possession and delivered in connection with the consummation of such
underlying transactions relating to various properties of the Lessor or received
by the Lessor as described in clause (y) above) of all of the property owned (as
determined in accordance with Lessor’s financial reporting under GAAP and
excluding those assets that are subject to leases that contain fixed price
purchase options and residual value guarantees (a) where the title to such
assets does not reside directly with the Lessor or (b) such assets were financed
with either (i) non-recourse debt exceeding 95% of the cost of the such assets,
or (ii) equity or other non-controlling interests that do not participate in all
of the profits and losses of the Lessor) by the Lessor (the “Fifty Percent FMV
Event”). In the event that a Lessor Notice is given, the Lessor, upon receipt of
a written request from the Lessee, may, at its option, elect to either
(i) obtain additional assets such that the gross asset value of the Property
does not ever constitute more than fifty percent (50%) of the total assets of
the Lessor (excluding those assets that are subject to leases that contain fixed
price purchase options and residual value guarantees (a) where the title to such
assets does not reside directly with the Lessor or (b) such assets were financed
with either (i) non-recourse debt exceeding 95% of the cost of the such assets,
or (ii) equity or other non-controlling interests that do not participate in all
of the profits and losses of the Lessor), (ii) transfer its interests in all of
the Property to another Affiliate of the Lessor such that the representations
set forth in the Lessor Confirmation Letter remain correct, or (iii) obtain, at
the Lessee’s sole cost and expense, a SAS 97-type letter reasonably acceptable
to the Lessee from the Lessor’s auditor to certify that the Lessor is a voting
interest entity as defined by FASB Interpretation No. 46 (to be renewed as
required). Nothing relating to the circumstances surrounding or the physical
delivery of the Lessor Notice will in any way inhibit or prohibit the Lessee’s
right to replace the Lessor pursuant to Section 10.1(d). Notwithstanding the
foregoing, in no event will the Lessor be required to disclose or provide access
to any information to the extent that such disclosure or access would violate
any law applicable to the Lessor or its Affiliates, including without limitation
banking regulations applicable to national banks, or result in a breach of the
Lessor’s or any Affiliate’s confidentiality policies or agreements. The parties
hereto agree that the Lessee is the sole beneficiary of the matters addressed in
this Section 8.2(e).

(f) Upon the Lessee’s prior written request, the Lessor shall provide to the
Lessee at least fifteen (15) days prior to the end of each calendar quarter and
at least forty-five (45) days prior to the end of each calendar year, a
confirmed copy of the Lessor Confirmation Letter. The parties hereto agree that
the Lessee is the sole beneficiary of the matters addressed in this
Section 8.2(f).

(g) Lessor shall not finance any portion of the Lessor Advance with non-recourse
debt to the extent that such financing of the Lessor Advance will cause more
than ninety-five percent (95%) of the aggregate amount of the Financing to be
funded with non-recourse debt.

 

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8.3 Lessee Covenants, Consent and Acknowledgment.

(a) Each Credit Party acknowledges and agrees that the Borrower, pursuant to the
terms and conditions of the Security Agreement and the Mortgage Instruments,
shall create Liens respecting the various personal property, fixtures and real
property described therein in favor of the Agent. Each Credit Party hereby
irrevocably consents to the creation, perfection and maintenance of such Liens.
Each Credit Party shall, to the extent reasonably requested by any of the other
parties hereto, cooperate with the other parties in connection with their
covenants herein or in the other Operative Agreements and shall from time to
time duly execute and deliver any and all such future instruments, documents and
financing statements (and continuation statements related thereto) as any other
party hereto may reasonably request.

(b) The Lessor hereby instructs each Credit Party, and each Credit Party hereby
acknowledges and agrees, that until such time as the Financing is paid in full
and the Liens evidenced by the Security Agreement and the Mortgage Instruments
have been released (i) any and all Rent (excluding Excepted Payments which shall
be payable to each Person as appropriate) and any and all other amounts of any
kind or type under any of the Operative Agreements due and owing or payable to
any Person shall instead be paid directly to the Agent (excluding Excepted
Payments which shall be payable to each Person as appropriate) or as the Agent
may direct from time to time, and (ii) each Credit Party shall cause all
notices, certificates, financial statements, communications and other
information which are delivered, or are required to be delivered, to the Lessor,
to also to be delivered at the same time to the Agent.

(c) No Credit Party shall consent to or permit any amendment, supplement or
other modification of the terms or provisions of any Operative Agreement to
which it is a party except in accordance with Section 12.4 of this Agreement.

(d) Each Credit Party hereby covenants and agrees that, except for amounts
payable as Basic Rent, any and all payment obligations owing from time to time
under the Operative Agreements by any Person to the Agent, the Lessor, any
Credit Lender, any Mortgage Lender or any other Person shall (without further
action) be deemed to be Supplemental Rent obligations payable by the Lessee and
guaranteed by the other Credit Parties. Such obligations of the Credit Parties
shall include without limitation arrangement fees, structuring fees,
administrative fees, unused fees, facility fees, breakage costs, indemnities,
trustee fees and transaction expenses incurred by the parties hereto in
connection with the transactions contemplated by the Operative Agreements.

(e) The Lessee hereby covenants and agrees to cause an Appraisal or reappraisal
(in form and substance reasonably satisfactory to the Agent and from an
appraiser selected by the Agent) to be issued respecting the Property as
requested by the Agent from time to time (i) at each and every time as such
shall be required to satisfy any regulatory requirements imposed on the Agent,
the Lessor and/or any Primary Financing Party and (ii) after the occurrence of a
Lease Event of Default.

(f) [Reserved].

(g) At any time the Lessor or the Agent is entitled under the Operative
Agreements to possession of the Property or any component thereof, the Lessee
hereby covenants and agrees, at its own cost and expense, to assemble and make
the same available to the Agent (on behalf of the Lessor).

 

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(h) [Reserved].

(i) [Reserved].

(j) The Lessee hereby covenants and agrees that it shall give prompt notice to
the Agent and the Primary Financing Parties if the Lessee’s location for
purposes of the UCC shall cease to be Ohio, or if its principal place of
business or chief executive office, or the office where the records concerning
the accounts or contract rights relating to the Property are kept, shall cease
to be located at 201 East Fourth Street, Cincinnati, Hamilton County, Ohio
45202, or if it shall change its name.

(k) [Reserved].

(l) [Reserved].

(m) [Reserved].

(n) [Reserved].

(o) Each Guarantor shall promptly notify the Agent, or cause the Agent to be
promptly notified, upon such Guarantor gaining knowledge of the occurrence of
any Default or Event of Default which is continuing at such time.

(p) [Reserved].

(q) [Reserved].

(r) [Reserved].

(s) [Reserved].

(t) [Reserved].

(u) [Reserved].

(v) [Reserved].

(w) The Lessee shall deliver (or cause to be delivered) an annual certificate
evidencing the insurance required to be maintained by the Lessee under
Article XIV of the Lease on the date such certificate is due thereunder.

(x) The Lessee shall cause the Property to comply with all Insurance
Requirements (unless the failure to comply with such Insurance Requirements will
not result in a denial of coverage under any insurance policy required to be
maintained hereunder or under any other Operative Agreement) and all standards
of Lessee with respect to similar properties owned by Lessee.

(y) The Lessee shall cause the Property to comply with all Legal Requirements
(including without limitation all zoning and land use laws and Environmental
Laws), except to the extent that failure to comply therewith, individually or in
the aggregate, shall not have and could not reasonably be expected to have a
Material Adverse Effect.

 

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(z) [Reserved].

(aa) [Reserved].

(bb) [Reserved].

(cc) [Reserved].

(dd) Lessee shall not incur or suffer to exist any Lien on the Property other
than the Liens created and/or evidenced by the Security Documents, Permitted
Liens, Lessor Liens and as otherwise permitted under Section 8.5.

(ee) Lessee shall deliver a written notice to Agent and the Lessor promptly upon
Lessee’s receiving notice or actual knowledge of a Responsible Officer of Lessee
of the taking by a Governmental Authority of an action which would constitute a
Condemnation, receiving notice of a material violation of any Legal Requirement
on or at the Property, including any Environmental Law, under which liability
may be imposed upon Lessor, Agent, any other Primary Financing Party or Lessee,
or receiving notice or actual knowledge of modification of the Property (other
than routine construction progress, fire, life-safety and similar inspections)
for any violation of Lessor under which criminal liability may be imposed upon
Agent, any Primary Financing Party or Lessee.

(ff) Lessee shall not, nor shall it permit anyone authorized to act on its
behalf to, take any action which would subject the Property, the Operative
Agreements, the making of the Credit Loans or Mortgage Loans or any security or
lease the offering of which, for purposes of the Securities Act or any state
securities laws, would be deemed to be part of the same offering of the
aforementioned items, to the registration requirements of Section 5 of the
Securities Act or any state securities laws.

(gg) [Reserved].

(hh) Lessee will promptly (but in no event more than ten (10) Business Days
after such event or occurrence) provide written notice to the Agent if it shall
change its legal name or use, or transact any business under, any trade name
other than its legal name.

(ii) [Reserved].

(jj) In the event, for any reason, there is a pledge of collateral by Lessee,
any Guarantor or any of their respective subsidiaries to secure, in whole or in
part, the Lessee Credit Agreement (including without limitation any amendment,
modification, extension, supplement, restatement and/or replacement thereof),
then Lessee shall take all necessary action to cause the Agent, the Lenders and
the Lessor (in connection with the obligations owing by Lessee, the Guarantors
or any of their respective subsidiaries pursuant to the Operative Agreements) to
share equally and ratably in, and be secured equally and ratably by, any lien
and security interest in the collateral granted to secure the Lessee Credit
Agreement (including without limitation any amendment, modification, extension,
supplement, restatement and/or replacement thereof).

 

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8.3A Affirmative Covenants.

Until the principal of and interest on each Note, the principal amount of the
Lessor Advance and all Lessor Yield, and all fees or other amounts payable to
any Financing Party hereunder or under any other Operative Agreement shall have
been paid in full, the Lessee covenants and agrees with the Primary Financing
Parties that:

8.3A.1 Financial Statements and Other Information.

The Lessee will furnish to the Agent, the Lessor and each Lender:

(a) within 90 days after the end of each fiscal year of the Lessee, its audited
consolidated balance sheet and related statements of operations, stockholders’
equity and cash flows as of the end of and for such year, setting forth in each
case in comparative form the figures for the previous fiscal year, all reported
on by Ernst & Young LLP or other independent public accountants of recognized
national standing (without a “going concern” or like qualification or exception
and without any qualification or exception as to the scope of such audit) to the
effect that such consolidated financial statements present fairly in all
material respects the financial condition and results of operations of the
Lessee and its consolidated Subsidiaries on a consolidated basis in accordance
with GAAP consistently applied;

(b) within 45 days after the end of each of the first three fiscal quarters of
each fiscal year of the Lessee, its consolidated balance sheet and related
statements of operations, stockholders’ equity and cash flows as of the end of
and for such fiscal quarter and the then elapsed portion of the fiscal year,
setting forth in each case in comparative form the figures for the corresponding
period or periods of (or, in the case of the balance sheet, as of the end of)
the previous fiscal year, all certified by one of its Financial Officers as
presenting fairly in all material respects the financial condition and results
of operations of the Lessee and its consolidated Subsidiaries on a consolidated
basis in accordance with GAAP consistently applied, subject to normal year-end
audit adjustments and the absence of footnotes;

(c) concurrently with any delivery of financial statements under clause (a) or
(b) above, a certificate of a Financial Officer of the Lessee (i) certifying as
to whether a Lease Default or a Lease Event of Default has occurred and, if a
Lease Default or a Lease Event of Default has occurred, specifying the details
thereof and any action taken or proposed to be taken with respect thereto,
(ii) setting forth reasonably detailed calculations demonstrating compliance
with Sections 8.3B.8 and 8.3B.9 and (iii) stating whether any change in GAAP or
in the application thereof has occurred since the date of the audited financial
statements referred to in Section 6.2(d) and, if any such change has occurred,
specifying the effect of such change on the financial statements accompanying
such certificate;

(d) promptly after the same become publicly available, copies of all periodic
and other reports and proxy statements filed by the Lessee or any Subsidiary
with the Securities and Exchange Commission, or any Governmental Authority
succeeding to any or all of the functions of said Commission, or with any
national securities exchange, or distributed by the Lessee to its shareholders
generally, as the case may be, provided, however, the Lessee’s delivery
obligation pursuant to this clause (d) is subject to the final sentence of this
Section 8.3A.1;

(e) promptly after Moody’s, S&P or Fitch shall have announced a change in the
rating established or deemed to have been established for the Index Debt,
written notice of such rating change;

 

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(f) promptly following a request therefor, any documentation or other
information that a Lender reasonably requests in order to comply with its
ongoing obligations under applicable “know your customer” and anti-money
laundering rules and regulations, including the USA Patriot Act; and

(g) promptly following any request therefor, such other information regarding
the operations, business affairs and financial condition of the Lessee or any
Subsidiary, or compliance with the terms of this Agreement, as the Agent or any
Lender may reasonably request.

Notwithstanding the foregoing provisions of this Section 8.3A.1, to the extent
the Lessee files the various reports, statements and any other information
referred to in Section 8.3A.1(d) with the Securities and Exchange Commission and
such reports, statements and other information is publicly available on the
Securities and Exchange Commission website, then the Lessee shall be deemed to
be in compliance with its obligations to furnish such reports, statements and
other such information pursuant to Section 8.3A.1(d).

8.3A.2 Notices of Material Events.

The Lessee will furnish to the Agent, the Lessor and each Lender prompt written
notice of the following:

(a) the occurrence of any Lease Default or Lease Event of Default;

(b) the filing or commencement of any action, suit or proceeding by or before
any arbitrator or Governmental Authority against or affecting the Lessee or any
Affiliate thereof that, if adversely determined, could reasonably be expected to
result in a Material Adverse Effect;

(c) the occurrence of any ERISA Event that, alone or together with any other
ERISA Events that have occurred, could reasonably be expected to result in
liability of the Lessee and its Subsidiaries in an aggregate amount exceeding
$20,000,000;

(d) any change in the date of its fiscal year end; and

(e) any other development that results in, or could reasonably be expected to
result in, a Material Adverse Effect.

Each notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or other executive officer of the Lessee setting forth the
details of the event or development requiring such notice and any action taken
or proposed to be taken with respect thereto.

8.3A.3 Existence; Conduct of Business.

The Lessee will, and will cause each of the Subsidiaries to, do or cause to be
done all things necessary to preserve, renew and keep in full force and effect
its legal existence and the rights, licenses, permits, privileges and franchises
material to the conduct of its business; provided that the foregoing shall not
prohibit any merger, consolidation, liquidation or dissolution permitted under
Section 8.3B.4.

 

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8.3A.4 Payment of Obligations.

The Lessee will, and will cause each of the Subsidiaries to, pay its
obligations, including Tax liabilities, that, if not paid, could result in a
Material Adverse Effect before the same shall become delinquent or in default,
except where (a) the validity or amount thereof is being contested in good faith
by appropriate proceedings, (b) the Lessee or such Subsidiary has set aside on
its books adequate reserves with respect thereto in accordance with GAAP and
(c) the failure to make payment pending such contest could not reasonably be
expected to result in a Material Adverse Effect.

8.3A.5 Maintenance of Property; Insurance.

The Lessee will, and will cause each of the Subsidiaries to, (a) keep and
maintain all property material to the conduct of its business in good working
order and condition, ordinary wear and tear excepted, and (b) maintain, with
financially sound and reputable insurance companies, insurance in such amounts
and against such risks as are customarily maintained by companies engaged in the
same or similar businesses operating in the same or similar locations.

8.3A.6 Books and Records; Inspection Rights.

The Lessee will, and will cause each of the Subsidiaries to, keep proper books
of record and account in which full, true and correct entries are made of all
dealings and transactions in relation to its business and activities. The Lessee
will, and will cause each of the Subsidiaries to, permit any representatives
designated by the Agent, the Lessor or any Lender, upon reasonable prior notice,
to visit and inspect its properties, to examine and make extracts from its books
and records, and to discuss its affairs, finances and condition with its
officers and independent accountants, all at such reasonable times and as often
as reasonably requested.

8.3A.7 Compliance with Laws.

The Lessee will, and will cause each of the Subsidiaries to, comply with all
laws, rules, regulations and orders of any Governmental Authority applicable to
it or its property, except where the failure to do so, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect.

8.3A.8 Use of Proceeds.

The proceeds of the Lessor Advance and the Loans will be used only for the
payment of the amounts described in Section 1 of this Agreement.

8.3A.9 Guarantee Requirement.

The Lessee will cause the Guarantee Requirement to be satisfied at all times.
Each Subsidiary (other than any Foreign Subsidiary) designated as a Material
Subsidiary by the Lessee or the Agent, as applicable (as described in the
definition of “Material Subsidiary”), shall for all purposes of the Operative
Agreements immediately be a Material Subsidiary and a Guarantor from the time of
such designation. Each Subsidiary (other than such which is already a party to
this Agreement and other than any Foreign Subsidiary) designated as a Material
Subsidiary shall execute a joinder agreement, in form and substance satisfactory
to the Agent, evidencing that such Subsidiary (other than any Foreign
Subsidiary) has been joined as a Guarantor; provided, notwithstanding any
failure or delay in the execution of such joinder agreement, each such
Subsidiary (other than any Foreign Subsidiary) shall be a Guarantor from the
time of such designation as a Material Subsidiary. Concurrent with its delivery
of the above-referenced joinder

 

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agreement, each such Material Subsidiary (other than any Foreign Subsidiary)
shall also execute a secretary’s certificate in the form attached hereto as
Exhibit D, with the exhibits thereto evidencing the power and authority for such
Material Subsidiary to enter into the Guarantee Agreement and the due
authorization of the Guarantee Agreement. Both the joinder agreement and the
secretary’s certificate shall be delivered promptly (and in any event within ten
(10) Business Days after the date of designation of such Subsidiary (other than
any Foreign Subsidiary) as a Material Subsidiary) to the Agent.

8.3B Negative Covenants.

Until the principal of and interest on each Note, the principal amount of the
Lessor Advance and all Lessor Yield, and all fees or other amounts payable to
any Financing Party hereunder or under any other Operative Agreement shall have
been paid in full, the Lessee covenants and agrees with the Primary Financing
Parties that:

8.3B.1 Priority Indebtedness.

The Lessee will not, and will not permit any Subsidiary to, create, incur,
assume or permit to exist any Priority Indebtedness other than:

(a) Indebtedness under the Lessee Credit Agreement Loan Documents;

(b) Indebtedness existing on the date hereof and set forth on Schedule 8.3B.1,
and extensions, renewals or replacements of any such Indebtedness that do not
increase the outstanding principal amount thereof; provided that no additional
Subsidiaries will be added as obligors or guarantors in respect of any
Indebtedness referred to in this clause (b) and no such Indebtedness shall be
secured by any additional assets (other than as a result of any Lien covering
after- acquired property in effect on the date hereof);

(c) Indebtedness of any Subsidiary to the Lessee or any other Subsidiary, or
Indebtedness of the Lessee to any Subsidiary; provided that no such Indebtedness
shall be assigned to, or subjected to any Lien in favor of, a Person other than
the Lessee or a Subsidiary;

(d) Indebtedness incurred to finance the acquisition, construction or
improvement of, and secured by, any fixed or capital assets acquired,
constructed or improved by the Lessee or any Subsidiary, and extensions,
renewals or replacements of any such Indebtedness that do not increase the
outstanding principal amount thereof or add additional Subsidiaries as obligors
or guarantors in respect thereof and that are not secured by any additional
assets; provided that such Indebtedness is incurred prior to or within 90 days
after such acquisition or the completion of such construction or improvement and
does not exceed 90% of the cost of acquiring, constructing or improving such
fixed or capital assets;

(e) Indebtedness of any Person that becomes a Subsidiary after the date hereof;
provided that such Indebtedness exists at the time such Person becomes a
Subsidiary, is not created in contemplation of or in connection with such Person
becoming a Subsidiary and is not secured by any Liens other than Liens permitted
under Section 8.3B.2(c), and extensions, renewals or replacements of any of the
Indebtedness referred to above in this clause that do not increase the
outstanding principal amount thereof or add additional Subsidiaries as obligors
or guarantors in respect thereof and that are not secured by any additional
assets;

(f) Indebtedness of any Subsidiary as an account party in respect of letters of
credit backing obligations of any Subsidiary that do not constitute
Indebtedness;

 

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(g) Indebtedness incurred in connection with any sale and lease-back
transactions permitted under Section 8.3B.3;

(h) Securitization Transactions to the extent that the aggregate amount, without
duplication, of all Securitization Transactions does not at any time exceed
$250,000,000; and

(i) other Priority Indebtedness in an aggregate amount outstanding at any time
not greater than $75,000,000.

8.3B.2 Liens.

The Lessee will not, and will not permit any Subsidiary to, create, incur,
assume or permit to exist any Lien on any property or asset now owned or
hereafter acquired by it, or assign or sell any income or revenues (including
accounts receivable) or rights in respect of any thereof, except:

(a) Permitted Encumbrances;

(b) any Lien on any property or asset of the Lessee or any Subsidiary existing
on the date hereof; provided that (i) such Lien shall not apply to any other
property or asset of the Lessee or any Subsidiary, (ii) such Lien shall secure
only those obligations which it secures on the date hereof and extensions,
renewals and replacements thereof that do not increase the outstanding principal
amount thereof and (iii) all such Liens secure obligations having an aggregate
principal amount not exceeding at any time $10,000,000;

(c) any Lien existing on any property or asset prior to the acquisition thereof
by the Lessee or any Subsidiary or existing on any property or asset of any
Person that becomes a Subsidiary after the date hereof prior to the time such
Person becomes a Subsidiary; provided that (i) such Lien is not created in
contemplation of or in connection with such acquisition or such Person becoming
a Subsidiary, as the case may be, (ii) such Lien shall not apply to any other
property or assets of the Lessee or any Subsidiary and (iii) such Lien shall
secure only those obligations which it secures on the date of such acquisition
or the date such Person becomes a Subsidiary, as the case may be and extensions,
renewals and replacements thereof that do not increase the outstanding principal
amount thereof;

(d) Liens on fixed or capital assets acquired, constructed or improved by the
Lessee or any Subsidiary securing Indebtedness incurred to finance such
acquisition, construction or improvement; provided that (i) such Liens and the
Indebtedness secured thereby are incurred prior to or within 90 days after such
acquisition or the completion of such construction or improvement, (ii) the
Indebtedness secured thereby does not exceed 90% of the cost of acquiring,
constructing or improving such fixed or capital assets and (iii) such Liens
shall not apply to any other property or assets of the Lessee or any Subsidiary;

(e) any Lien securing the Lessee’s obligations under any Hedging Agreement,
subject to the requirements of Section 8.3B.7;

(f) sales of accounts receivable and interests therein pursuant to
Securitization Transactions constituting Priority Indebtedness permitted under
Section 8.3B.1;

(g) Liens deemed to exist in connection with sale and lease-back transactions
permitted under Section 8.3B.3;

 

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(h) Liens securing Priority Indebtedness permitted under Section 8.3B.1(a),
(c) or (i);

(i) Liens in favor of the Agent, the Lessor and the Lenders pursuant to
Section 8.3(jj) and securing the obligations of Lessor, the Guarantors or any of
their respective subsidiaries pursuant to the Operative Agreements; and

(j) other Liens not specifically listed above securing obligations (other than
Indebtedness) not to exceed $1,000,000 at any one time outstanding.

8.3B.3 Sale and Lease-Back Transactions.

The Lessee will not, and will not permit any Subsidiary to, enter into any
arrangement, directly or indirectly, with any Person whereby it shall sell or
transfer any property used or useful in its business, whether now owned or
hereafter acquired, and thereafter rent or lease such property or other property
which it intends to use for substantially the same purpose or purposes as the
property being sold or transferred, except to the extent the aggregate sales
price for the assets transferred in all such arrangements in effect at any time
does not exceed $25,000,000.

8.3B.4 Fundamental Changes.

(a) The Lessee will not, and will not permit any Subsidiary to, merge or
consolidate with any other Person, or permit any other Person to merge or
consolidate with it, or sell, transfer, lease or otherwise dispose of (in one
transaction or in a series of transactions) all or substantially all its assets,
or all or substantially all the stock of any Subsidiary (in each case, whether
now owned or hereafter acquired), or liquidate or dissolve, except that, if at
the time thereof and immediately after giving effect thereto no Lease Default or
Lease Event of Default shall have occurred and be continuing:

(i) any Subsidiary may merge into the Lessee or any other Subsidiary; provided,
that in the case of any merger of one Subsidiary into another, if either of such
Subsidiaries shall be a Guarantor, the surviving or resulting Subsidiary must at
all times after such merger be a Guarantor;

(ii) any Subsidiary may sell, lease or otherwise transfer all or substantially
all its assets to the Lessee or to another Subsidiary; provided, that in the
case of any such transfer by one Subsidiary to another, if the transferor
Subsidiary shall be a Guarantor, the transferee Subsidiary must at all times
after such transfer be a Guarantor;

(iii) any Person other than a Subsidiary may merge with the Lessee or a
Subsidiary; provided, that (subject in all respects to Section 8.3B.4(b)) (A) in
the case of a merger to which the Lessee is a party, the Lessee must be the
surviving or resulting corporation, (B) in the case of a merger to which a
Subsidiary is a party, (I) the surviving or resulting Person must be a
Subsidiary (and, if any such constituent Subsidiary shall have been a Guarantor,
a Guarantor) or (II)(a) the aggregate amount of the assets of all Subsidiaries
previously having merged during the last four (4) reported fiscal quarters of
Lessee for which financial statements have been delivered pursuant to
Section 8.3A.1 pursuant to this subsection (II), plus the amount of the assets
of the Subsidiary then contemplated to merge during said time period pursuant to
this subsection (II), plus the aggregate amount of the assets of all
Subsidiaries previously sold, leased or otherwise transferred during said time
period pursuant to the following subsection (v) shall not

 

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exceed five percent (5%) of the Lessee’s consolidated assets as of the end of
said time period, (b) the aggregate amount of the revenues of all Subsidiaries
previously having merged during the last four (4) reported fiscal quarters of
Lessee for which financial statements have been delivered pursuant to
Section 8.3A.1 pursuant to this subsection (II), plus the amount of the revenues
of the Subsidiary then contemplated to merge during said time period pursuant to
this subsection (II), plus the aggregate amount of the revenues of all
Subsidiaries previously having sold, leased or otherwise transferred assets
during said time period pursuant to the following subsection (v) shall not
exceed five percent (5%) of the Lessee’s consolidated revenues as of the end of
said time period, and (c) the Lessee shall provide no less than thirty (30) days
notice of any such merger pursuant to this subsection (II) to the Agent and
(C) in the case of any merger referred to in this subsection (iii), the Lessee
shall be in compliance on a pro forma basis with the covenants set forth in
Sections 8.3B.8 and 8.3B.9 as of the end of and for said time period, giving
effect to such merger and any related incurrence or repayment of Indebtedness as
if it had occurred at the beginning of such period;

(iv) any Subsidiary may liquidate or dissolve if the Lessee determines in good
faith that such liquidation or dissolution is in the best interests of the
Lessee and is not materially disadvantageous to the Lessor or the Lenders; and

(v) (subject in all respects to Section 8.3B.4(c)) any Subsidiary may sell,
lease or otherwise transfer certain of its assets to any Person other than the
Lessee or a Subsidiary if and to the extent (A) the aggregate amount of the
assets of all Subsidiaries previously having been sold, leased or otherwise
transferred during the last four (4) reported fiscal quarters of Lessee for
which financial statements have been delivered pursuant to Section 8.3A.1
pursuant to this subsection (v), plus the amount of the assets of the Subsidiary
then contemplated to be sold, leased or otherwise transferred during said time
period pursuant to this subsection (v), plus the aggregate amount of the assets
of all Subsidiaries previously merged into a Person other than the Lessee or a
Subsidiary during said time period pursuant to the foregoing
subsection (iii)(B)(II) shall not exceed five percent (5%) of the Lessee’s
consolidated assets as of the end said time period, (B) the aggregate amount of
the revenues of all Subsidiaries previously having sold, leased or otherwise
transferred assets during the last four (4) reported fiscal quarters of Lessee
for which financial statements have been delivered pursuant to Section 8.3A.1
pursuant to this subsection (v), plus the amount of the revenues of the
Subsidiary then contemplated to sell, lease or otherwise transfer assets during
said time period pursuant to this subsection (v), plus the aggregate amount of
the revenues of all Subsidiaries previously merged into a Person other than the
Lessee or a Subsidiary during said time period pursuant to the foregoing
subsection (iii)(B)(II) shall not exceed five percent (5%) of the Lessee’s
consolidated revenues as of the end of said time period, and (C) the Lessee
shall provide no less than thirty (30) days notice of any such sale, lease or
other transfer pursuant to this subsection (v) to the Agent. Notwithstanding any
provision of this Section 8.3B.4, the Lessee and the Subsidiaries may complete
the HRM Sale, and said transaction shall not be included in any manner
whatsoever in any of the transactions otherwise permitted, computed or set forth
under subsection (i), (ii), (iii), (iv) or (v) hereof.

(b) Notwithstanding any provision in this Section 8.3B.4 to the contrary, no
Subsidiary may merge with any Person as described in
Section 8.3B.4(a)(iii)(B)(II) if and to the extent (x) the aggregate amount of
the assets of all Subsidiaries previously having merged pursuant to
Section 8.3B.4(a)(iii)(B)(II), plus the amount of the assets of the Subsidiary
then

 

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contemplated to merge pursuant to Section 8.3B.4(a)(iii)(B)(II), plus the
aggregate amount of the assets of all Subsidiaries previously sold, leased or
otherwise transferred pursuant to Section 8.3B.4(a)(v) would exceed ten percent
(10%) of the Lessee’s consolidated assets as of the end of the most recent
period of four fiscal quarters for which financial statements shall have been
delivered pursuant to Section 8.3A.1 or if (y) the aggregate amount of the
revenue of all Subsidiaries previously having merged pursuant to
Section 8.3B.4(a)(iii)(B)(II), plus the amount of the revenues of the Subsidiary
then contemplated to merge pursuant to Section 8.3B.4(a)(iii)(B)(II), plus the
aggregate amount of the revenues of all Subsidiaries previously having sold,
leased or otherwise transferred assets pursuant to Section 8.3B.4(a)(v) would
exceed ten percent (10%) of the Lessee’s consolidated revenues as of the end of
the most recent period of four fiscal quarters for which financial statements
shall have been delivered pursuant to Section 8.3A.1.

(c) Notwithstanding any provision in this Section 8.3B.4 to the contrary, no
Subsidiary may sell, lease or otherwise transfer certain of its assets as
described in Section 8.3B.4(a)(v) if and to the extent (x) the aggregate amount
of the assets of all Subsidiaries previously having been sold, leased or
otherwise transferred pursuant to Section 8.3B.4(a)(v), plus the amount of the
assets of the Subsidiary then contemplated to be sold, leased or otherwise
transferred as described in Section 8.3B.4(a)(v), plus the aggregate amount of
the assets of all Subsidiaries previously merged pursuant to
Section 8.3B.4(a)(iii)(B)(II) would exceed ten percent (10%) of the Lessee’s
consolidated assets as of the end of the most recent period of four fiscal
quarters for which financial statements shall have been delivered pursuant to
Section 8.3A.1 or if (y) the aggregate amount of the revenues of all
Subsidiaries previously having sold, leased or otherwise transferred assets
pursuant to Section 8.3B.4(a)(v), plus the amount of the revenues of the
Subsidiary then contemplated to sell, lease or otherwise transfer assets
pursuant to Section 8.3B.4(a)(v), plus the aggregate amount of the revenues of
all Subsidiaries previously merged pursuant to Section 8.3B.4(a)(iii)(B)(II)
would exceed ten percent (10%) of the Lessee’s consolidated revenues as of the
end of the most recent period of four fiscal quarters for which financial
statements shall have been delivered pursuant to Section 8.3A.1.

(d) The Lessee will not, and will not permit any Subsidiary to, engage to any
material extent in any business other than businesses of the type conducted by
the Lessee and the Subsidiaries on the date of execution of this Agreement and
businesses reasonably related thereto.

8.3B.5 Transactions with Affiliates.

The Lessee will not, and will not permit any Subsidiary to, sell, lease or
otherwise transfer any property or assets to, or purchase, lease or otherwise
acquire any property or assets from, or otherwise engage in any other
transactions with, any of its Affiliates, except (a) in the ordinary course of
business at prices and on terms and conditions not less favorable to the Lessee
or such Subsidiary than could be obtained on an arm’s-length basis from
unrelated third parties, (b) transactions between or among the Lessee and the
Subsidiaries not involving any other Affiliate and (c) dividends or other
distributions (whether in cash, securities or other property) with respect to
any shares of any class of capital stock of the Lessee or any Subsidiary, or any
payment (whether in cash, securities or other property), including any sinking
fund or similar deposit, on account of the purchase, redemption, retirement,
acquisition, cancelation or termination of any such shares of capital stock of
the Lessee or any option, warrant or other right to acquire any such shares of
capital stock of the Lessee.

 

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8.3B.6 Restrictive Agreements.

The Lessee will not, and will not permit any Subsidiary to, directly or
indirectly, enter into, incur or permit to exist any agreement or other
arrangement that prohibits, restricts or imposes any condition upon the ability
of any Subsidiary to pay dividends or other distributions with respect to any
shares of its capital stock or to make or repay loans or advances to the Lessee
or any other Subsidiary or to Guarantee Indebtedness of the Lessee or any other
Subsidiary; provided, that (i) the foregoing shall not apply to restrictions and
conditions imposed by law or by this Agreement and (ii) the foregoing shall not
apply to restrictions and conditions existing on the date hereof identified on
Schedule 8.3B.6 (but shall apply to any extension or renewal of, or any
amendment or modification expanding the scope of, any such restriction or
condition).

8.3B.7 Hedging Agreements.

The Lessee will not, and will not permit any Subsidiary to, enter into any
Hedging Agreement, except (a) Hedging Agreements entered into to hedge or
mitigate risks (including foreign exchange risks) to which the Lessee or any
Subsidiary has actual exposure, and (b) Hedging Agreements entered into in order
to effectively cap, collar or exchange interest rates (from fixed to floating
rates, from one floating rate to another floating rate, from floating rates to
fixed rates or otherwise) with respect to any interest-bearing liability or
investment of the Lessee or any Subsidiary.

8.3B.8 Interest Coverage Ratio.

The Lessee will not permit the ratio of (a) Consolidated EBITDA to
(b) Consolidated Interest Expense, in each case for any period of four
consecutive fiscal quarters, to be less than 4.0 to 1.0.

8.3B.9 Consolidated Total Debt to Consolidated EBITDA Ratio.

The Lessee will not at any time permit the ratio of (a) Consolidated Total Debt
at such time to (b) Consolidated EBITDA for the most recently ended period of
four consecutive fiscal quarters to be greater than 3.25 to 1.0.

8.3B.10 Certain Restricted Payments.

The Lessee will not make or become obligated to make any Restricted Payment
unless, after giving pro forma effect thereto, (a) (i) the sum of the total
Revolving Credit Exposures (as such term is defined in the Lessee Credit
Agreement) and the aggregate principal amount of outstanding Competitive Loans
(as such term is defined in the Lessee Credit Agreement) would not exceed
(ii) the total Commitments (as such term is defined in the Lessee Credit
Agreement) minus the aggregate Net Proceeds received or to be received from the
HRM Sale and (b) the Lessee and the Subsidiaries will have cash and cash
equivalents in amounts consistent with the customary business practices of the
Lessee and the Subsidiaries as determined in good faith by the Lessee.

8.4 Sharing of Certain Payments.

Except for Excepted Payments, the parties hereto acknowledge and agree that all
payments due and owing by the Lessee or any other Credit Party to the Lessor
under the Lease or any of the other Operative Agreements shall be made by the
Lessee or such other Credit Party directly to the Agent as more particularly
provided in Section 8.3 hereof.

 

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8.5 Grant of Easements, etc.

The Agent, the Credit Lenders, the Mortgage Lenders and the Lessor hereby agree
that, so long as no Event of Default shall have occurred and be continuing, and
until such time as the Agent gives instructions to the contrary to the Lessor
after the occurrence and continuance of such Event of Default, the Lessor shall,
from time to time at the request of the Lessee (and with the prior consent of
the Agent), in connection with the transactions contemplated by the Lease or the
other Operative Agreements, (i) grant easements and other rights in the nature
of easements, restrictions, covenants, rights of way or plats with respect to
the Property, (ii) release existing easements or other rights in the nature of
easements, restrictions, covenants, rights of way or plats which are for the
benefit of the Property, (iii) execute and deliver to any Person any instrument
appropriate to confirm or effect such grants or releases, and (iv) execute and
deliver to any Person such other documents or materials in connection with the
acquisition, development, construction, testing or operation of the Property,
including without limitation reciprocal easement agreements, construction
contracts, operating agreements, development agreements, plats, replats or
subdivision documents; provided, that each of the agreements referred to in this
Section 8.5 shall be of the type normally executed by the Lessee in the ordinary
course of the Lessee’s business and shall be on commercially reasonable terms so
as not to diminish the value of the Property in any material respect or
otherwise have a Material Adverse Effect.

8.6 Appointment of the Agent by the Primary Financing Parties.

(a) The Secured Parties acknowledge and agree and direct that the rights and
remedies of the beneficiaries of the Lien of the Security Documents shall be
exercised by the Agent on behalf of the Secured Parties in accordance with the
provisions of the Intercreditor Agreement; provided, in all cases, the Agent
shall allocate payments and other amounts received in accordance with
Section 8.7 and the Intercreditor Agreement. The Agent is further appointed to
provide notices under the Operative Agreements on behalf of the Lessor and each
Primary Financing Party (as determined by the Agent, in its reasonable
discretion), to receive notices under the Operative Agreements on behalf of the
Lessor and each Primary Financing Party and (subject to Section 8.5) to take
such other action under the Operative Agreements on behalf of the Lessor as the
Agent shall determine in its reasonable discretion from time to time. The Agent
hereby accepts such appointments. Further, the Agent shall be entitled to take
such action on behalf of the Lessor as is delegated to the Agent under any
Operative Agreement (whether express or implied) as may be reasonably incidental
thereto.

(b) Each Primary Financing Party hereby designates and appoints the Agent as the
agent of such Primary Financing Party under this Agreement and the other
Operative Agreements, and each such Primary Financing Party authorizes the
Agent, in such capacity, to execute the Operative Agreements as agent for and on
behalf of such Primary Financing Party, to take such action on behalf of such
Primary Financing Party under the provisions of this Agreement and the other
Operative Agreements and to exercise such powers and perform such duties as are
expressly delegated to the Agent by the terms of this Agreement and other
Operative Agreements, together with such other powers as are reasonably
incidental thereto. Subject to the terms of the Operative Agreements (including
without limitation the Intercreditor Agreement), each of the Primary Financing
Parties directs the Agent to exercise such powers, make such decisions and
otherwise perform such duties as are delegated to the Agent hereunder or
thereunder. Notwithstanding any provision to the contrary elsewhere in this
Agreement, the Agent shall not have any duties or responsibilities, except those
expressly set forth herein, or any fiduciary relationship with any Primary
Financing Party, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or any other
Operative Agreement or otherwise exist against the Agent.

 

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(c) The Agent may execute any of its duties under this Agreement and the other
Operative Agreements by or through agents or attorneys-in-fact and shall be
entitled to advice of counsel concerning all matters pertaining to such duties.
The Agent shall not be responsible for the negligence or misconduct of any
agents or attorneys-in-fact selected by it with reasonable care.

(d) Neither the Agent nor any of its officers, directors, employees, agents,
attorneys-in-fact or Affiliates shall be (a) liable for any action lawfully
taken or omitted to be taken by it or such Person under or in connection with
this Agreement or any other Operative Agreement (except for its or such Person’s
own gross negligence, willful misconduct or its or such Person’s failure to use
ordinary care in the handling of funds) or (b) responsible in any manner to any
of the Primary Financing Parties for any recitals, statements, representations
or warranties made by the Borrower or the Lessee or any officer thereof
contained in this Agreement or any other Operative Agreement or in any
certificate, report, statement or other document referred to or provided for in,
or received by the Agent under or in connection with, this Agreement or any
other Operative Agreement or for the value, validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or any other
Operative Agreement or for any failure of the Borrower or the Lessee to perform
its obligations hereunder or thereunder. The Agent shall not be under any
obligation to any Primary Financing Party to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions
of, this Agreement or any other Operative Agreement, or to inspect the
properties, books or records of the Borrower or the Lessee.

(e) The Agent shall be entitled to rely, and shall be fully protected in
relying, upon any Note, writing, resolution, notice, consent, certificate,
affidavit, letter, telecopy, telex or teletype 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 the
Borrower or the Lessee), independent accountants and other experts selected by
the Agent. The Agent may deem and treat the payee of any Note as the owner
thereof for all purposes unless a written notice of assignment, negotiation or
transfer thereof shall have been filed with the Agent. The Agent shall be fully
justified in failing or refusing to take any action under this Agreement or any
other Operative Agreement unless it shall first receive such advice or
concurrence of the Majority Secured Parties, the Majority Credit Lenders, the
Majority Mortgage Lenders or all the Primary Financing Parties, as the case may
be, as set forth in the Intercreditor Agreement or any other Operative Agreement
or it shall first be indemnified to its satisfaction by the Primary Financing
Parties against any and all liability and expense which may be incurred by it by
reason of taking or continuing to take any such action. The Agent shall in all
cases be fully protected in acting, or in refraining from acting, under this
Agreement and the other Operative Agreements in accordance with the
Intercreditor Agreement, and such and any action taken or failure to act
pursuant thereto shall be binding upon all the Primary Financing Parties and all
future holders of the Notes.

(f) The Agent shall not be deemed to have knowledge or notice of the occurrence
of any Default or Event of Default (other than the failure of Lessee to pay
Basic Rent to the Agent pursuant to the terms and conditions of the Operative
Agreements as and when due) hereunder unless the Agent has received written
notice from a Primary Financing Party, the Lessee or the Borrower referring to
this Agreement or such other Operative Agreement, describing such Default or
Event of Default and stating that such notice is a “notice of default”. In the
event that the Agent receives such a notice, the Agent shall give notice thereof
to the Primary Financing

 

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Parties and the Lessee. The Agent shall take such action with respect to such
Default or Event of Default as shall be reasonably directed in accordance with
the terms of the Intercreditor Agreement; provided, that unless and until the
Agent shall have received such directions, the Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default or Event of Default as it shall deem advisable in the best
interests of the Primary Financing Parties; provided, further, the foregoing
shall not limit the rights of the Majority Secured Parties, the Majority Credit
Lenders, the Majority Mortgage Lenders or all the Primary Financing Parties, as
the case may be, as described in this Agreement or the Intercreditor Agreement.

(g) Each Primary Financing Party expressly acknowledges that neither the Agent
nor any of its officers, directors, employees, agents, attorneys-in-fact or
Affiliates has made any representations or warranties to it and that no act by
the Agent hereinafter taken, including without limitation any review of the
affairs of the Lessee, shall be deemed to constitute any representation or
warranty by the Agent to any Primary Financing Party. Each Primary Financing
Party represents to the Agent that it has, independently and without reliance
upon the Agent or any other Primary Financing Party, and based on such documents
and information as it has deemed appropriate, made its own appraisal of and
investigation into the business, operations, property, financial and other
condition and creditworthiness of the Lessee and made its own decision to make
its Credit Loans, make its Mortgage Loans or make its Lessor Advance hereunder
and enter into this Agreement. Each Primary Financing Party also represents that
it will, independently and without reliance upon the Agent or any other Primary
Financing Party, 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 Agreement and the other
Operative Agreements, and to make such investigation as it deems necessary to
inform itself as to the business, operations, property, financial and other
condition and creditworthiness of the Lessee. The Agent agrees to provide to the
Primary Financing Parties notices, reports and other documents that are
customarily provided by the Agent in its capacity as Agent in transactions
similar to the transactions contemplated hereby and by the other Operative
Agreements. Except for notices, reports and other documents expressly required
to be furnished to the Primary Financing Parties by the Agent hereunder, the
Agent shall not have any duty or responsibility to provide any Primary Financing
Party with any credit or other information concerning the business, operations,
property, condition (financial or otherwise), prospects or creditworthiness of
the Lessee which may come into the possession of the Agent or any of its
officers, directors, employees, agents, attorneys-in-fact or Affiliates.

(h) The Primary Financing Parties agree to indemnify the Agent, in its capacity
as such (to the extent not reimbursed by the Borrower or the Lessee and without
limiting any obligation of the Borrower or the Lessee under and in accordance
with the terms of the Operative Agreements to do so), ratably according to their
respective Commitment Percentages in effect on the date on which indemnification
is sought under this Section (or, if indemnification is sought after the date
upon which the Credit Notes, the Mortgage Notes and the Lessor Advance shall
have been paid in full, ratably in accordance with their Commitment Percentages
immediately prior to such date), 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 the payment of the Credit
Notes, the Mortgage Notes and the Lessor Advance) be imposed on, incurred by or
asserted against the Agent in any way relating to or arising out of, the
Commitments, this Agreement, any of the other Operative Agreements 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 the Agent under
or in connection with any of the foregoing; provided, that no Primary Financing
Party shall be liable

 

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for the payment of any portion of such liabilities, obligations, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements resulting
solely from the gross negligence or willful misconduct of the Agent, or its
failure to use ordinary care in the handling of funds. The agreements in this
Section shall survive the payment of the Credit Loans, the Mortgage Loans and
the Lessor Advance and all other amounts payable hereunder.

(i) The Agent and its Affiliates may make loans to, accept deposits from and
generally engage in any kind of business with the Borrower and/or the Lessee as
though the Agent were not the Agent hereunder and under the other Operative
Agreements.

(j) (i) The Agent may resign at any time as the Agent upon sixty (60) days’
notice to the Primary Financing Parties, the Borrower and, so long as no Lease
Event of Default shall have occurred and be continuing, the Lessee. If the Agent
shall resign as the Agent under this Agreement, a successor Agent shall be
appointed by the Majority Secured Parties, which successor Agent shall be
subject to the approval of, so long as no Lease Event of Default shall have
occurred and be continuing, the Lessee, such approval not to be unreasonably
withheld or delayed. If no successor Agent is appointed prior to the effective
date of the resignation of the resigning Agent, the Agent may appoint, after
consulting with the Primary Financing Parties and subject to the approval of, so
long as no Lease Event of Default shall have occurred and be continuing, the
Lessee, such approval not to be unreasonably withheld or delayed, a successor
Agent. Any successor Agent, however appointed, shall be a national banking
association or a state chartered bank doing business within the United States of
America and having a combined capital and surplus of at least $350,000,000, and
having a Debt Rating of “A” or better on the date of such appointment if there
be such an institution willing, able and legally qualified to perform the duties
of the Agent hereunder upon reasonable or customary terms. If no successor Agent
has accepted appointment as the Agent by the date which is sixty (60) days
following a retiring Agent’s notice of resignation, the retiring Agent’s notice
of resignation shall nevertheless thereupon become effective and the Primary
Financing Parties shall perform all of the duties of the Agent until such time,
if any, as the Majority Secured Parties appoint a successor Agent, as provided
for above. Upon the effective date of such resignation, only such successor
Agent shall succeed to all the rights, powers and duties of the retiring Agent
and the term “Agent” shall mean such successor agent and the retiring Agent’s
rights, powers and duties in such capacity shall be terminated. After any
retiring Agent resigns hereunder as the Agent, the provisions of this
Section 8.6 shall inure to such retiring Agent’s benefit as to any actions taken
or omitted to be taken by it while it was the Agent under this Agreement.

(ii) The Agent may be removed (x) by any of the Majority Credit Lenders, the
Majority Mortgage Lenders or the Lessor in the case of fraud, misappropriation
of funds or the commission of illegal acts by the Agent or where the Agent has
failed to perform its obligations hereunder or under any other Operative
Agreement in any material respect, (y) any time at the request of any Primary
Financing Party, but only with the consent of the Majority Credit Lenders, the
Majority Mortgage Lenders, the Lessor and so long as no Lease Event of Default
shall have occurred and be continuing, the Lessee, or (z) at any time that an
Event of Default shall have occurred and be continuing, by the Majority Credit
Lenders. Any such removal shall be effective upon the acceptance of appointment
of a successor Agent in accordance with the provisions of paragraph (i) of this
Section 8.6(j); provided, however, to the extent the Agent being replaced
pursuant to clause (x) of this Section 8.6(j)(ii) is also a Credit Lender, a
Mortgage Lender or the Lessor, such Person shall not be permitted to vote in
connection with the appointment or approval of a successor Agent pursuant to
paragraph (i) of this Section 8.6(j).

 

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(k) Other than the exercise of reasonable care to assure the safe custody of the
Property while being held by the Agent hereunder or under any other Operative
Agreement, the Agent shall have no duty or liability to preserve rights
pertaining thereto, it being understood and agreed that the Lessee shall be
responsible for preservation of the Property, and the Agent shall be relieved of
all responsibility for the condition or preservation of the Property upon
surrendering it or tendering the surrender of it to the Lessee. The Agent shall
be deemed to have exercised reasonable care in the custody and preservation of
the Property in its possession if the Property is accorded treatment
substantially equal to that which the Agent accords its own property, which
shall be no less than the treatment employed by a reasonable and prudent agent
in the industry, it being understood that the Agent shall not have
responsibility (except to reasonably comply with any express notice from any
Primary Financing Party delivered to the Agent pursuant to the terms of the
Operative Agreements) for taking any necessary steps to preserve rights against
any parties with respect to any of the Property.

8.7 Collection and Allocation of Payments and Other Amounts; Special Provision
Regarding Post-Expiration Date Sales.

(a) The Lessee has agreed pursuant to Section 5.10 and otherwise in accordance
with the terms of this Agreement to pay to (i) the Agent any and all Rent
(excluding Excepted Payments) and any and all other amounts of any kind or type
under any of the Operative Agreements due and owing or payable by the Lessee to
any party hereto and (ii) each Person as appropriate the Excepted Payments.
Promptly after receipt, the Agent shall apply and allocate, in accordance with
the terms of this Section 8.7, such amounts received from the Lessee and all
other payments, receipts and other consideration of any kind whatsoever received
by the Agent pursuant to the Security Agreement or otherwise received by the
Agent, the Lessor or any of the Primary Financing Parties in connection with the
Collateral, the Security Documents or any of the other Operative Agreements.

(b) Except as set forth in Sections 8.7(b)(ii) and 8.7(d) and except for
Excepted Payments, payments and other amounts received by the Agent (or the
Lessor, in which case such amount shall be paid to the Agent for distribution in
accordance with this Section 8.7(b)) from time to time in accordance with the
terms of subparagraph (a) shall be applied and allocated as follows (subject in
all cases to Section 8.7(c)):

(i) Any such payment or amount identified as or deemed to be Basic Rent, any
amount in respect of any Casualty, Condemnation or Environmental Violation
pursuant to Sections 15.1(a) or 15.1(g) of the Lease (excluding any payments in
respect thereof which are payable to the Lessee in accordance with the Lease),
any amount equal to any payment identified as proceeds of the sale or other
disposition (or lease upon the exercise of remedies) of the Property to a third
party or any portion thereof, whether pursuant to Article XXII of the Lease or
the exercise of remedies under the Security Documents or otherwise or the
exercise of foreclosure remedies under the Lease, any payment in respect of
excess wear and tear pursuant to Section 22.3 of the Lease, any payment pursuant
to Section 22.1(b) of the Lease (or otherwise) of the Maximum Residual Guarantee
Amount, any payment of Termination Value, any payment by any Guarantor, and any
other amount received by the Agent or the Lessor, as the case may be, shall be
applied and allocated by the Agent: first, to the Primary Financing Parties for
application and allocation to any and all amounts owing under the Operative
Agreements

 

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to the Primary Financing Parties in accordance with the terms and provisions of
the Intercreditor Agreement; and second, any excess shall be paid to the Lessee
or such Person or Persons as the Lessee may designate.

(ii) An amount equal to any such payment identified as Supplemental Rent payable
to the Agent, the Lessor or any other Primary Financing Party shall be applied
and allocated by the Agent to the payment of any amounts then owing to the
Agent, the Lessor, the other Primary Financing Parties, and the other parties to
the Operative Agreements (or any of them) (other than any such amounts payable
pursuant to the preceding provisions of this Section 8.7(b)) as shall be
appropriate based upon the purposes for which such amount of Supplemental Rent
is payable; provided, however, that Supplemental Rent received after the
occurrence and continuance of an Event of Default shall be applied and allocated
by the Agent: first, to the Primary Financing Parties for application and
allocation to any and all amounts owing under the Operative Agreements to the
Primary Financing Parties in accordance with the terms and provisions of the
Intercreditor Agreement; and second, any excess shall be paid to the Lessee or
such Person or Persons as the Lessee may designate.

(iii) The Agent in its reasonable judgment shall identify the nature of each
payment or amount received by the Agent and apply and allocate each such amount
in the manner specified above.

(c) Notwithstanding any provision contained herein or in any other Operative
Agreement to the contrary, upon the payment in full of the Credit Notes, the
Mortgage Notes and all other amounts then due and owing by the Borrower to the
Credit Lenders and the Mortgage Lenders hereunder or under any other Operative
Agreement, the payment in full of the Lessor Advance, all Lessor Yield and all
other amounts then due and owing by the Lessee to the Lessor hereunder or under
any other Operative Agreement and the payment in full of all other amounts then
due and owing to the Financing Parties pursuant to the Operative Agreements, any
moneys remaining with the Agent shall be returned to the Lessee or its designee.
Notwithstanding the foregoing, the obligations of the Lessee shall be
automatically reinstated if and to the extent that for any reason any payment by
or on behalf of the Lessee is rescinded or must be otherwise restored by any
Financing Party, whether as a result of any proceedings in bankruptcy or
reorganization or otherwise, and the Lessee agrees that it will, subject to the
limitations expressly set forth in the Operative Agreements, indemnify each
Financing Party on demand for all reasonable costs and expenses (including,
without limitation, reasonable fees of counsel) incurred by any Financing Party
in connection with such rescission or restoration, including without limitation
any such costs and expenses incurred in defending against any claim alleging
that such payment constituted a preference, fraudulent transfer or similar
payment under any bankruptcy, insolvency or similar law.

(d) If possession of the Property is delivered to Lessor pursuant to
Section 22.6 of the Lease, then at the end of each calendar month following the
Expiration Date, any amounts received by the Agent during the calendar month
then ended as proceeds from the sale, rental, or other disposition of the
Property and any insurance proceeds paid in connection with a Casualty or
Condemnation relating to the Property shall be distributed by the Agent in the
following order of priority: first, so much of such payment or amount as shall
be required to reimburse the Agent and the Lessor for any expenses, fees,
indemnities or other losses incurred by the Agent or the Lessor under the
Operative Agreements relating to, or which the Agent or the Lessor determines is
allocable to, the Property, second, so much of such amount as shall be required
to pay to any Person, including the Agent or the Lessor, all expenses and other
costs and expenses of

 

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maintaining, operating or insuring the Property, third, so much of such amount
as shall be required to pay actual and reasonable costs of selling the Property
during the preceding calendar month, including all finders’ and brokers’ fees
allocable to the Property, fourth, to the Primary Financing Parties whose
Primary Financing Party Balances were not paid in full as of the Expiration Date
to pay in full the Post-Expiration Date Balance of each such Primary Financing
Party, fifth, solely with respect to a sale of the Property prior to the two
year anniversary of the Expiration Date, to the Lessee in an amount up to any
previously unreimbursed Maximum Residual Guarantee Amount; and sixth, the
balance, if any, shall be promptly distributed to, or as directed by, the
Lessor.

8.8 Release of the Property, etc.

If the Lessee shall at any time purchase the Property pursuant to the Lease or
if the Property shall be sold in accordance with Article XXII of the Lease,
then, upon satisfaction by the Borrower of its obligation to prepay the
Financing and all other amounts owing to the Financing Parties under the
Operative Agreements, the Agent is hereby authorized and directed to release the
Property from the Liens created by the Security Documents to the extent of its
interest therein. In addition, upon the termination of the Commitments and the
payment in full of the Financing and all other amounts owing by the Borrower and
the Lessee hereunder or under any other Operative Agreement, the Agent is hereby
authorized and directed to release the Property from the Liens created by the
Security Documents to the extent of its interest therein. Upon request of the
Borrower following any such release, the Agent shall, at the sole cost and
expense of the Lessee, execute and deliver to the Borrower and the Lessee such
documents as the Borrower or the Lessee shall reasonably request to evidence
such release.

8.9 Limitation of Lessor’s Obligations.

(a) The Lessor shall not have any duty or obligation to manage, control, use,
make any payment in respect of, register, record, insure, inspect, sell, dispose
of or otherwise deal with the Property or any other part of the Borrower’s
Interest, or to otherwise take or refrain from taking any action under or in
connection with any Operative Agreement to which the Lessor is a party, except
as expressly provided by the terms of the Operative Agreements or in written
instructions from all the Primary Financing Parties and/or the Majority Secured
Parties, as applicable, received pursuant to Section 8.6; and no implied duties
or obligations shall be read into the Operative Agreements against the Lessor.
The Lessor nevertheless agrees that it will promptly take all action as may be
necessary to discharge any Lessor Liens on any part of the Property.

(b) The Lessor agrees that it will not manage, control, use, sell, dispose of or
otherwise deal with the Property or any other part of the Borrower’s Interest
except (a) as required by the terms of the Operative Agreements, (b) in
accordance with the powers granted to, or the authority conferred upon, it
pursuant to the Operative Agreements or (c) in accordance with the express terms
hereof and with written instructions from the Agent, all the Primary Financing
Parties and/or the Majority Secured Parties, as applicable, pursuant to
Section 8.6.

(c) Except in accordance with written instructions furnished pursuant to an
applicable provision of the Operative Agreements (expressly cited in such
instructions), and without limitation of the generality of Section 8.9(a), the
Lessor shall not have any duty to (i) file, record or deposit any Operative
Agreement or any other document, or to maintain any such filing, recording or
deposit or to refile, rerecord or redeposit any such document; (ii) obtain
insurance on the Property or effect or maintain any such insurance, other than
to receive and forward to each Primary Financing Party and the Agent any
notices, policies, certificates or binders furnished to

 

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the Lessor pursuant to the Lease; (iii) maintain the Property; (iv) pay or
discharge any Tax or any Lien owing with respect to or assessed or levied
against any part of the Borrower’s Interest, except as provided in the last
sentence of Section 8.9(a), other than to forward notice of such Tax or Lien
received by the Lessor to the Lessee, each Primary Financing Party and the
Agent; (v) confirm, verify, investigate or inquire into the failure to receive
any reports or financial statements of Lessee or any other Person; (vi) inspect
the Property at any time or ascertain or inquire as to the performance or
observance of any of the covenants of Lessee or any other Person under any
Operative Agreement with respect to the Property; or (vii) manage, control, use,
sell, dispose of or otherwise deal with the Property or any part thereof or any
other part of the Borrower’s Interest, except as provided in Section 8.9(b).

(d) The Lessor, in the exercise or administration of its powers pursuant to the
Operative Agreements, may, at the expense and, so long as no Lease Default or
Lease Event of Default shall have occurred and be continuing, with the consent
of Lessee employ agents, attorneys, accountants, and auditors and enter into
agreements with any of them and the Lessor shall not be liable for the default
or misconduct of any such agents, attorneys, accountants or auditors if such
agents, attorneys, accountants or auditors shall have been selected by it with
reasonable care.

8.10 NO REPRESENTATIONS OR WARRANTIES AS TO THE PROPERTY OR OPERATIVE
AGREEMENTS.

THE LESSOR MAKES (I) NO REPRESENTATION OR WARRANTY, EITHER EXPRESS OR IMPLIED,
AS TO THE TITLE, VALUE, USE, CONDITION, DESIGN, OPERATION, MERCHANTABILITY OR
FITNESS FOR USE OF THE PROPERTY (OR ANY PART THEREOF), OR ANY OTHER
REPRESENTATION, WARRANTY OR COVENANT WHATSOEVER, EXPRESS OR IMPLIED, WITH
RESPECT TO THE PROPERTY (OR ANY PART THEREOF) AND THE LESSOR SHALL NOT BE LIABLE
FOR ANY LATENT, HIDDEN, OR PATENT DEFECT THEREIN OR THE FAILURE OF THE PROPERTY,
OR ANY PART THEREOF, TO COMPLY WITH ANY LEGAL REQUIREMENT EXCEPT AS EXPRESSLY
SET FORTH IN THE OPERATIVE AGREEMENTS, INCLUDING SECTION 6.1(l) AND THE LAST
SENTENCE OF SECTION 8.9(a) HEREOF, AND (II) NO REPRESENTATION OR WARRANTY AS TO
THE VALIDITY OR ENFORCEABILITY OF ANY OPERATIVE AGREEMENT AS AGAINST ANY PERSON
OTHER THAN THE LESSOR OR AS TO THE CORRECTNESS OF ANY STATEMENT MADE BY A PERSON
OTHER THAN THE LESSOR CONTAINED IN ANY THEREOF.

8.11 Reliance; Advice of Counsel.

Neither the Agent nor the Lessor shall incur any liability to any Person in
acting upon any signature, instrument, notice, resolution, request, consent,
order, certificate, report, opinion, bond or other document or paper reasonably
believed by it to be genuine and believed by it in good faith to be signed by
the proper party or parties. Each of the Agent and the Lessor may accept and
rely upon a certified copy of a resolution of the board of directors or other
governing body of any corporate party as conclusive evidence that such
resolution has been duly adopted by such body and that the same is in full force
and effect. As to any fact or matter the manner of ascertainment of which is not
specifically prescribed herein, each of the Agent and the Lessor may for all
purposes of the Operative Agreements rely on an Officer’s Certificate of the
relevant party, as to such fact or matter, and such certificate shall constitute
full protection to each of the Agent and the Lessor for any action taken or
omitted to be taken by it reasonably in good faith in reliance thereon. In the
administration of each of the Agent’s and the Lessor’s duties, the Lessor may
execute and perform its powers and duties directly or through agents or
attorneys and may consult with counsel, accountants and other skilled Persons to
be selected and employed by it,

 

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and neither the Agent nor the Lessor shall be liable for anything done, suffered
or omitted reasonably in good faith by it in accordance with the advice or
opinion of any such counsel, accountants or other skilled Persons and not
contrary to the Operative Agreements.

8.12 Amendments to Lessee Credit Agreement.

The Lessee hereby agrees to furnish, or cause to be furnished, to the Agent and
each of the Credit Lenders, promptly upon the effectiveness thereof, notice of
any additions, amendments or modifications to the financial and negative
covenants (and related definitions) set forth in the Lessee Credit Agreement to
the extent the same are not included in, or are more favorable to the lenders
party thereto than the covenants set forth in Section 8.3B of, this Agreement.
In such event, the Lessee hereby agrees to make modifications or supplements to
the covenants set forth in (a) Sections 8.3B.1, 8.3B.2, 8.3B.3, 8.3B.8, and
8.3B.9, of this Agreement and (b) (only to the extent modifications or
supplements to the following sections are requested by two or more Lenders)
Sections 8.3B.4, 8.3B.5, 8.3B.6, 8.3B.7, and 8.3B.10, of this Agreement, with
regard to each of the covenants referenced in the foregoing subsections (a) and
(b) in a manner consistent with such addition, amendment, modification or
supplement made to such covenants in the Lessee Credit Agreement.
Notwithstanding the foregoing, the Lessee hereby further agrees that such
changes, additions, modifications or supplements to such covenants shall be
deemed immediately and automatically effective hereunder upon (x) the
effectiveness of such modification or addition to such covenants set forth in
the Lessee Credit Agreement (with regard to each of the covenants referenced in
the foregoing subsection (a)) and (y) the effectiveness of such modification or
addition to such covenants set forth in the Lessee Credit Agreement (with regard
to each of the covenants referenced in the foregoing subsection (b) subsequent
to a request by two or more Lenders), with regard to the matters referenced in
the foregoing subsections (x) and (y) without any further action on the part of
the Majority Credit Lenders, including, without limitation, the entering into of
a written amendment or supplement to any Operative Agreement. The parties
nevertheless agree to promptly enter into a written amendment or supplement
memorializing any of such changes, additions, modifications or supplements upon
the request of any other party.

8.13 Non-Disturbance.

In furtherance of Section 5.1 of the Lease, each of the Financing Parties hereby
acknowledges and agrees that so long as no Lease Event of Default shall exist
and be continuing, neither the Agent nor any Primary Financing Party will
disturb the possession of Lessee, will terminate the Lease or join Lessee in
summary ejectment or foreclosure proceedings (unless such joinder is required to
effect such ejectment or foreclosure proceedings against the Borrower, but
subject to the non-disturbance rights of Lessee hereunder), and shall recognize
the leasehold estate and contractual rights of the Lessee under the Lease,
including without limitation the Purchase Option granted thereunder to the
Lessee, it being understood that such leasehold estate and rights of the Lessee
shall be unaffected by any foreclosure action or enforcement of remedies by the
Agent or any Primary Financing Party hereunder so long as no Lease Event of
Default shall exist and be continuing.

SECTION 9

LOAN AGREEMENTS

9.1 The Lessee’s Loan Agreement Rights.

Notwithstanding anything to the contrary contained in either Loan Agreement, the
Agent, the Borrower, the Lenders and the Lessee hereby agree that, prior to the
occurrence and continuation of any Lease Default or Lease Event of Default, the
Lessee shall have the following rights:

(a) [Reserved];

 

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(b) [Reserved];

(c) the right to exercise the conversion and continuation options pursuant to
Section 2.7 of either Loan Agreement, respectively;

(d) the right to receive any notice and any certificate, in each case issued
pursuant to Section 2.11(a) of either Loan Agreement, respectively; and

(e) the right to replace any Lender pursuant to Section 2.11(b) of either Loan
Agreement, respectively.

SECTION 10

TRANSFER OF INTEREST

10.1 Restrictions on Transfer.

(a) The Lessor may, subject to the rights of the Lessee under the Lease and the
other Operative Agreements, the rights of the Primary Financing Parties under
the Operative Agreements and to the Lien of the applicable Security Documents,
directly or indirectly, assign, convey, or otherwise transfer all but not less
than all of its right, title and interest in or to the Property, the Lease and
the other Operative Agreements (including without limitation any right to
indemnification thereunder), and any other document relating to the Property or
any interest in the Property as provided in the Lease to any Eligible Lessor for
any reason, but only with the prior written consent of the Majority Secured
Parties (the consent of any individual Secured Party not to be unreasonably
withheld or delayed) and (provided, no Lease Default or Lease Event of Default
has occurred and is continuing) with the consent of the Lessee (not to be
unreasonably withheld or delayed). The Lessor hereby agrees that the Lessee
shall be deemed to have acted reasonably and shall have exercised reasonable
discretion in the event and to the extent the Lessee has withheld its consent to
or refused to approve any requested transfer, assignment, conveyance or
appointment by the Lessor under this Section 10.1(a) based on a reasonable
belief that the requested transfer, assignment, conveyance or appointment will
adversely affect the accounting by the Lessee of the transactions contemplated
hereunder and under the other Operative Agreements in accordance with GAAP. The
provisions of the first sentence of this Section 10.1(a) shall not apply to the
obligations of the Lessor to transfer the Property to the Lessee or a third
party purchaser pursuant to Article XXII of the Lease upon payment for the
Property in accordance with the terms and conditions of the Lease. The Lessee
may not assign any of the Operative Agreements or any of its rights or
obligations thereunder or with respect to the Property in whole or in part to
any Person without the prior written consent of the Agent and the Primary
Financing Parties. Each Credit Lender may participate, assign or transfer all or
a portion of its interest hereunder and under the other Operative Agreements
only in accordance with the provisions of the Credit Note Loan Agreement, and
each Mortgage Lender may participate, assign or transfer all or a portion of its
interest hereunder and under the other Operative Agreements only in accordance
with the Mortgage Note Loan Agreement.

(b) Notwithstanding anything to the contrary in Section 10.1(a), no consent
shall be required from the Agent, the Lessee or any Primary Financing Party (but
Lessor shall provide one hundred eighty (180) days (or such shorter period as
required by the Legal Requirement giving

 

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rise to the assignment, conveyance, appointment or transfer contemplated by this
Section 10.1(b)) written notice to the Agent and the Lessee) in connection with
any assignment, conveyance, appointment or transfer by the Lessor required by
any Legal Requirement (including pursuant to the direction or recommendation of
any Governmental Authority) of all or any of its right, title or interest in or
to the Property, the Lease and the other Operative Agreements (including without
limitation any right to indemnification thereunder), or any other document
relating to the Property or any interest in the Property as provided in the
Lease to an Eligible Lessor; provided, in such case, so long as no Lease Default
or Lease Event of Default shall have occurred and be continuing, Lessee shall
have the right to require the Lessor (unless such transfer or conveyance has
already occurred, in which case the Lessee shall have the right to require such
transferee) to transfer its interest to an Eligible Lessor selected by the
Lessee, in its reasonable discretion; provided, further, Lessee shall be
responsible for any cost or expense incurred by the Lessor in connection with
any assignment, conveyance, appointment or transfer by the Lessor pursuant to
this Section 10.1(b).

(c) The Lessee agrees to indemnify the Lessor for any actual loss, claim or
increased costs incurred by the Lessor and quantified to Lessee in writing by
Lessor in reasonable detail as a result of any change in GAAP that adversely
affects the Lessor; provided, however, in the case of such a change in GAAP that
adversely affects the Lessor, as long as no Lease Default or Lease Event of
Default shall have occurred and be continuing, Lessee shall have the right to
require the Lessor to transfer its interest to an Eligible Lessor selected by
the Lessee, in its reasonable discretion; provided, further, nothing in the
preceding proviso shall limit the obligation of the Lessee to provide the
indemnity set forth in this Section 10.1(c). Lessor hereby agrees to notify the
Lessee within thirty (30) days after a Responsible Officer of Lessor obtains
knowledge of an actual or proposed change in GAAP that would require Lessee’s
performance under this Section 10.1(c); provided, notwithstanding the foregoing,
Lessor agrees to use reasonable efforts to notify Lessee of any such change in
GAAP that adversely affects the Lessor prior to the effective date of any such
change in GAAP.

(d) (i) Lessee shall have the right at any time during the Term to require the
Lessor to transfer its interest in the Property and the Operative Agreements to
an Eligible Lessor selected by the Lessee, in its reasonable discretion;
provided, Lessee shall give the Agent (on behalf of the Secured Parties)
reasonable prior written notice of any transfer pursuant to this
Section 10.1(d)(i).

(ii) If a Bankruptcy Event of the parent company of the Lessor shall have
occurred and be continuing, the Majority Credit Lenders shall have the right to
require the Lessor to transfer its interest in the Property and the Operative
Agreements to an Eligible Lessor selected by the Majority Credit Lenders, in
their reasonable discretion; provided, nothing in this Section 10.1(d)(ii) shall
be deemed to prevent the Lessee from exercising its rights (or otherwise affect
the Lessee’s rights) under Section 10.1(d)(i) to require any transferee Eligible
Lessor selected by the Majority Credit Lenders pursuant to this
Section 10.1(d)(ii) to transfer its interest in the Property and the Operative
Agreements to an Eligible Lessor selected by the Lessee, in its reasonable
discretion.

10.2 Effect of Transfer.

From and after any transfer effected in accordance with this Section 10, the
transferor shall be released, to the extent of such transfer, from its liability
hereunder and under the other documents to which it is a party in respect of
obligations to be performed on or after the date of such transfer; provided,
however, that any transferor shall remain liable hereunder and under such other
documents to the extent

 

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that the transferee shall not have assumed the obligations of the transferor
thereunder. Upon any transfer by the Lessor or any other Primary Financing Party
as above provided, any such transferee shall assume the obligations of the
Lessor or such Primary Financing Party, as the case may be, and shall be deemed
the “Lessor” and/or a “Primary Financing Party”, as the case may be, for all
purposes of such documents and each reference herein to the transferor shall
thereafter be deemed a reference to such transferee for all purposes, except as
provided in the preceding sentence. Notwithstanding any transfer of all of the
transferor’s interest as provided in this Section 10, the transferor shall be
entitled to all benefits accrued and all rights vested prior to such transfer
including without limitation rights to indemnification under any such document.

SECTION 11

INDEMNIFICATION

11.1 General Indemnity.

Subject to the provisions of Sections 11.6, 11.7 and 11.8 whether or not any of
the transactions contemplated hereby shall be consummated, the Indemnity
Provider hereby assumes liability for and agrees to defend, indemnify and hold
harmless each Indemnified Person on an After Tax Basis from and against any
Claims, which may be imposed on, incurred by or asserted against an Indemnified
Person by any third party, including without limitation Claims arising from the
negligence of an Indemnified Person (but not to the extent such Claims arise
from the (u) misrepresentation or breach of warranty by an Indemnifed Person
regarding its representations and warranties under any of the Operative
Agreements, (v) failure by an Indemnified Person to comply with applicable state
or federal banking Laws or other Laws, (w) acts or omissions that occur after
the Credit Loans, the Mortgage Loans, the Lessor Advance and all other amounts
outstanding under or pursuant to the Operative Agreements have been paid in full
and the Lessee has either purchased the Property in accordance with the terms of
the Operative Agreements or relinquished its interest in the Property in
accordance with the terms of the Operative Agreements, (x) gross negligence or
willful misconduct of such Indemnified Person itself, as determined by a court
of competent jurisdiction (as opposed to gross negligence or willful misconduct
imputed to such Indemnified Person) or (y) breach of such Indemnified Person’s
obligations under this Agreement, the Lease or any other Operative Agreement,
except any breach by any Indemnified Person caused by any breach by any Credit
Party of any obligation of any Credit Party pursuant to the Operative
Agreements) in any way relating to or arising or alleged to arise out of the
execution, delivery, performance or enforcement of this Agreement, the Lease or
any other Operative Agreement or on or with respect to the Property or any
component thereof, including without limitation Claims in any way relating to or
arising or alleged to arise out of (a) the financing, refinancing, purchase,
ownership, design, construction, refurbishment, development, delivery,
acceptance, nondelivery, leasing, subleasing, possession, use, occupancy,
operation, maintenance, repair, modification or any disposition of the Property
or any part thereof; (b) any latent or other defects in the Property or any
portion thereof whether or not discoverable by an Indemnified Person or the
Indemnity Provider; (c) a violation of Environmental Laws, Environmental Claims
or other loss of or damage to any property or the environment relating to the
Property, the Lease or the Indemnity Provider (collectively, all such items
referenced in this Section 11.1(c) may be referred to as the “Environmental
Matters”); (d) the Operative Agreements, or any transaction contemplated
thereby; (e) any breach by the Indemnity Provider of any of its representations
or warranties under the Operative Agreements to which the Indemnity Provider is
a party or failure by the Indemnity Provider to perform or observe any covenant
or agreement to be performed by it under any of the Operative Agreements;
(f) the transactions contemplated hereby or by any other Operative Agreement, in
respect of the application of Parts 4 and 5 of Subtitle B of Title I of ERISA;
(g) personal injury, death or property damage, including without limitation
Claims based on strict or absolute liability in tort; and (h) any fees, expenses
and/or other assessments by any business park or any other similar entity for
the Property.

 

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If a written Claim is made against any Indemnified Person or if any proceeding
shall be commenced against such Indemnified Person (including without limitation
a written notice of such proceeding), for any Claim, such Indemnified Person
shall promptly notify the Indemnity Provider in writing and shall not take
action with respect to such Claim without the consent of the Indemnity Provider
for thirty (30) days after the receipt of such notice by the Indemnity Provider;
provided, however, that in the case of any such Claim, if action shall be
required by law or regulation to be taken prior to the end of such period of
thirty (30) days, such Indemnified Person shall endeavor to, in such notice to
the Indemnity Provider, inform the Indemnity Provider of such shorter period,
and no action shall be taken with respect to such Claim without the consent of
the Indemnity Provider before seven (7) days before the end of such shorter
period (unless required by law or regulation prior to the end of such seven (7)
day period); provided, further, that the failure of such Indemnified Person to
give the notices referred to in this sentence shall not diminish the Indemnity
Provider’s obligation hereunder except to the extent such failure precludes in
all respects the Indemnity Provider from contesting such Claim.

If, within thirty (30) days of receipt of such notice from the Indemnified
Person (or such shorter period as the Indemnified Person has notified the
Indemnity Provider is required by law or regulation for the Indemnified Person
to respond to such Claim), the Indemnity Provider shall request in writing that
such Indemnified Person respond to such Claim, the Indemnified Person shall, at
the expense of the Indemnity Provider, in good faith conduct and control such
action (including without limitation by pursuit of appeals); provided, however,
that (A) if such Claim, in the Indemnity Provider’s reasonable discretion, can
be pursued by the Indemnity Provider on behalf of or in the name of such
Indemnified Person, the Indemnified Person, at the Indemnity Provider’s request,
shall allow the Indemnity Provider to conduct and control the response to such
Claim and (B) in the case of any Claim (and notwithstanding the provisions of
the foregoing subsection (A)), the Indemnified Person may request the Indemnity
Provider to conduct and control the response to such Claim with counsel to be
selected by the Indemnity Provider after the solicitation and consideration of
any advice provided by such Indemnified Person. In any event, with regard to any
Claim for which the response is to be conducted and controlled by the Indemnity
Provider, any Indemnified Person may retain separate counsel at the expense of
the Indemnity Provider in the event of a material conflict of interest between
such Indemnified Person and the Indemnity Provider. Also, in the sole discretion
of the Person conducting and controlling the response to any Claim, such
response may include (1) resisting payment thereof, (2) not paying the same
except under protest, if protest is necessary and proper, (3) if the payment be
made, using reasonable efforts to obtain a refund thereof in appropriate
administrative and judicial proceedings, or (4) taking such other action as is
reasonably recommended by competent counsel from time to time.

The party controlling the response to any Claim shall consult in good faith with
the non-controlling party and shall keep the non-controlling party reasonably
informed as to the conduct of the response to such Claim; provided, that all
decisions ultimately shall be made in the reasonable discretion of the
controlling party; and, provided, further, the parties agree that an Indemnified
Person may at any time decline to take further action with respect to the
response to a Claim and may settle the Claim if such Indemnified Person shall
waive its rights to any indemnity from the Indemnity Provider for costs of the
settlement in excess of a Reasonable Settlement Amount that otherwise would be
payable in respect of such Claim (or in respect of any future Claim, the pursuit
of which is precluded by reason of such settlement of such Claim) and shall
reimburse the Indemnity Provider any such excess costs previously paid or
advanced by the Indemnity Provider pursuant to this Section 11.1 by way of
indemnification or advance for a payment regarding such Claim.

 

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Notwithstanding the foregoing provisions of this Section 11.1, an Indemnified
Person shall not be required to take any action unless (A) the Indemnity
Provider shall have agreed to pay and shall pay to such Indemnified Person on
demand and on an After Tax Basis all reasonable costs, losses and expenses that
such Indemnified Person actually incurs in connection with such Claim, including
without limitation all reasonable legal, accounting and investigatory fees and
disbursements and, if the Indemnified Person has informed the Indemnity Provider
that it intends to contest such Claim (whether or not the control of the contest
is then assumed by the Indemnity Provider), the Indemnity Provider shall have
agreed that the Claim is an indemnifiable Claim hereunder, (B) in the case of a
Claim that must be pursued in the name of an Indemnified Person (or an Affiliate
thereof), the amount of the potential indemnity (taking into account all similar
or logically related Claims that have been or could be raised for which the
Indemnity Provider may be liable to pay an indemnity under this Section 11.1)
exceeds $250,000 (or such lesser amount as may be subsequently agreed between
the Indemnity Provider and the Indemnified Person), (C) the Indemnified Person
shall have reasonably determined that the action to be taken will not result in
any material danger of sale, forfeiture or loss of the Property, or any part
thereof or interest therein, will not interfere with the payment of Rent, and
will not result in risk of criminal liability, (D) if such Claim shall involve
the payment of any amount prior to the resolution of such Claim, the Indemnity
Provider shall provide to the Indemnified Person an interest-free advance in an
amount equal to the amount that the Indemnified Person is reasonably required to
pay upon advice of counsel (with no additional net after-tax cost to such
Indemnified Person) prior to the date such payment is due, (E) in the case of a
Claim, including any appeal thereof, that must be pursued in the name of an
Indemnified Person (or an Affiliate thereof), the Indemnity Provider shall have
caused to be provided to such Indemnified Person advice, but not an opinion, of
independent counsel selected by the Indemnity Provider and reasonably
satisfactory to the Indemnified Person stating that a reasonable basis exists to
contest such Claim (or, in the case of an appeal of an adverse determination,
advice, but not an opinion, of such counsel to the effect that the position
asserted in such appeal will more likely than not prevail) and (F) no Event of
Default shall have occurred and be continuing. In no event shall an Indemnified
Person be required to appeal an adverse judicial determination to the United
States Supreme Court. In addition, an Indemnified Person shall not be required
to contest any Claim in its name (or that of an Affiliate) if the subject matter
thereof shall be of a continuing nature and shall have previously been decided
adversely by a court of competent jurisdiction pursuant to the contest
provisions of this Section 11.1, unless there shall have been a Change in Law
and the Indemnified Person shall have received, at the Indemnity Provider’s
expense, advice, but not an opinion, of independent counsel selected by the
Indemnity Provider and reasonably acceptable to the Indemnified Person stating
that as a result of such Change in Law, it is more likely than not that the
Indemnified Person will prevail in such contest. In no event shall the Indemnity
Provider be permitted to adjust or settle any Claim without the consent of the
Indemnified Person to the extent any such adjustment or settlement involves, or
is reasonably likely to involve, any performance by or adverse admission by or
with respect to the Indemnified Person.

In the event that the Indemnity Provider shall be required to make any payment
under this Section 11.1 to an Indemnified Person, the Indemnified Person agrees
to take such reasonable action as is requested by the Indemnity Provider, in
writing, any such action to be at the risk and expense of the Indemnity
Provider, to minimize the consequences of the After-Tax Basis method of the
indemnity.

Each Indemnified Person shall cooperate in good faith (provided, the Indemnity
Provider shall bear all cost and expense incurred by each Indemnified Person in
connection therewith) in connection with any actions, suits or proceedings in
providing any information in the possession of such Indemnified Person which may
be requested by counsel of the Indemnity Provider in connection with any matter
for which the Indemnified Person seeks indemnification under the Operative
Agreements.

Upon payment in full of any Claim by the Indemnity Provider or any insurer under
a policy of insurance, the Indemnity Provider, without any further action, shall
be subrogated to the claim that the

 

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Indemnified Person may have relating thereto and such Indemnified Person shall
execute such instruments of assignments and conveyance, evidence of claims and
payment and such other documents, instruments and agreements as may be
reasonably necessary to preserve any such claims and otherwise cooperate with
the Indemnity Provider as may be reasonably necessary or advisable to enable the
Indemnity Provider or its insurer as the case may be vigorously to pursue the
Claim; provided, notwithstanding the foregoing, (a) the Indemnity Provider shall
bear all cost and expense incurred by each Indemnified Person in connection with
any and all of the matters described in this paragraph and (b) each and every
instrument, evidence of claims and payments, document and agreement of any kind
or type referenced in this paragraph shall be (i) prepared by the Indemnity
Provider and (ii) modified as requested by the Indemnified Person, in the
exercise of such Indemnified Persons commercially reasonable judgment.

11.2 General Tax Indemnity.

(a) Subject to and limited by in all respects the provisions of this
Section 11.2 and Sections 11.7 and 11.8, the Indemnity Provider shall pay and
assume liability for, and does hereby agree to indemnify, protect and defend the
Property and all Indemnified Persons, and hold them harmless against, (i) all
Impositions on an After Tax Basis and (ii) taxes that are in the nature of gross
income, privilege or doing business taxes (not included in the definition of
Impositions) imposed to the extent related to the transactions contemplated
hereby, the Lessor, and all payments pursuant to the Operative Agreements shall
be made free and clear of and without deduction for any and all present and
future Impositions. In the event that the Indemnity Provider shall be required
to make any payment under this Section 11.2(a) to an Indemnified Person, the
Indemnified Person agrees to take such reasonable action as is requested by the
Indemnity Provider, in writing, any such action to be at the risk and expense of
the Indemnity Provider, to minimize the consequences of the After-Tax Basis
method of the indemnity.

(b) Notwithstanding anything to the contrary in Section 11.2(a) hereof, the
following shall be excluded from the indemnity required by Section 11.2(a)
(collectively, the “Excluded Taxes”):

(i) Taxes (other than Taxes that are, or are in the nature of, sales, use,
rental, value added, ad valorem, transfer or property taxes) that are imposed on
any Indemnified Person (other than the Lessor) by the United States federal
government that generally apply to financial institutions by reason of the types
of activities undertaken by them and that are based on or measured by the net
income (including without limitation taxes based on capital gains and minimum
taxes) of such Person; provided, that this clause (i) shall not be interpreted
to prevent a payment from being made on an After Tax Basis if such payment is
otherwise required to be so made;

(ii) Taxes (other than Taxes that are, or are in the nature of, sales, use,
rental, value added, ad valorem, transfer or property taxes) that are imposed on
any Indemnified Person (other than the Lessor) by any state or local
jurisdiction or taxing authority within any state or local jurisdiction and that
are based upon or measured by the net income (including without limitation taxes
based on capital gains and minimum taxes) of such Person; provided that such
Taxes shall not be excluded under this subparagraph (ii) to the extent such
Taxes would have been imposed had the location, possession or use of the
Property in, the location or the operation of the Lessee in, or the Lessee’s
making payments under the Operative Agreements from, the jurisdiction imposing
such Taxes been the sole connection between such Indemnified Person and the
jurisdiction imposing such Taxes; provided, further, that this clause (ii) shall
not be interpreted to prevent a payment from being made on an After Tax Basis if
such payment is otherwise required to be so made;

 

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(iii) any Tax to the extent it relates to any act, event or omission that occurs
after the termination of the Lease and redelivery or sale of the Property in
accordance with the terms of the Lease (but not any Tax that relates to such
termination, redelivery or sale and/or to any period prior to such termination,
redelivery or sale); and

(iv) any Taxes which are imposed on an Indemnified Person as a result of the
gross negligence or willful misconduct of such Indemnified Person itself, as
determined by a court of competent jurisdiction (as opposed to gross negligence
or willful misconduct imputed to such Indemnified Person), but not Taxes imposed
as a result of ordinary negligence of such Indemnified Person.

Notwithstanding the foregoing, the exclusions from the definition of
“Impositions” set forth in clauses (i), (ii) and (iii) shall not apply (but the
other exclusions shall apply) to any Taxes or increase in Taxes imposed on an
Indemnified Person net of any decrease in Taxes realized by such Indemnified
Person, to the extent that such tax increase or decrease would not have occurred
if on the Closing Date the Primary Financing Parties had advanced funds to the
Lessee in the form of a loan secured by the Property in an amount equal to the
Advances funded on such date, with debt service equal to the Basic Rent payable
on each Schedule Interest Payment Date and a principal balance at the maturity
of such loan in an amount equal to the then outstanding amount of the Notes and
the Lessor Advance at the end of the term of the Lease.

(c)(i) Subject to the terms of Section 11.2(f), the Indemnity Provider shall pay
or cause to be paid in a timely manner all Impositions directly to the taxing
authorities where feasible and otherwise to the Indemnified Person, as
appropriate, and the Indemnity Provider shall at its own expense, upon such
Indemnified Person’s reasonable request, furnish to such Indemnified Person
copies of official receipts or other satisfactory proof evidencing such payment.

(ii) In the case of Impositions for which no contest is conducted pursuant to
Section 11.2(f) and which the Indemnity Provider pays directly to the taxing
authorities, the Indemnity Provider shall pay such Impositions prior to the
latest time permitted by the relevant taxing authority for timely payment. In
the case of Impositions for which the Indemnity Provider reimburses an
Indemnified Person, the Indemnity Provider shall do so within thirty (30) days
after receipt by the Indemnity Provider of demand by such Indemnified Person
describing in reasonable detail the nature of the Imposition and the basis for
the demand (including without limitation the computation of the amount payable),
accompanied by receipts or other reasonable evidence of such demand. In the case
of Impositions for which a contest is conducted pursuant to Section 11.2(f), the
Indemnity Provider shall pay such Impositions or reimburse such Indemnified
Person for such Impositions, to the extent not previously paid or reimbursed
pursuant to subsection (a), prior to the latest time permitted by the relevant
taxing authority for timely payment after conclusion of all contests under
Section 11.2(f).

(iii) At the Indemnity Provider’s request, the amount of any indemnification
payment by the Indemnity Provider pursuant to subsection (a) shall be verified
and certified by an independent public accounting firm mutually acceptable to
the Indemnity Provider and the Indemnified Person. The fees and expenses of such
independent public accounting firm shall be paid by the Indemnity Provider
unless such verification shall

 

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result in an adjustment in the Indemnity Provider’s favor of five percent
(5%) or more of the payment as computed by the Indemnified Person, in which case
such fee shall be paid by the Indemnified Person.

(d) The Indemnity Provider shall be responsible for preparing and filing any
real and personal property or ad valorem tax returns in respect of the Property.
In case any other report or tax return shall be required to be made with respect
to any obligations of the Indemnity Provider under or arising out of subsection
(a) and of which the Indemnity Provider has knowledge or should have knowledge,
the Indemnity Provider, at its sole cost and expense, shall notify the relevant
Indemnified Person of such requirement and (except if such Indemnified Person
notifies the Indemnity Provider that such Indemnified Person intends to prepare
and file such report or return) (A) to the extent required or permitted by and
consistent with Legal Requirements, make and file in the Indemnity Provider’s
name such return, statement or report; and (B) in the case of any other such
return, statement or report required to be made in the name of such Indemnified
Person, advise such Indemnified Person of such fact and prepare such return,
statement or report for filing by such Indemnified Person or, where such return,
statement or report shall be required to reflect items in addition to any
obligations of the Indemnity Provider under or arising out of subsection (a),
provide such Indemnified Person at the Indemnity Provider’s expense with
information sufficient to permit such return, statement or report to be properly
made with respect to any obligations of the Indemnity Provider under or arising
out of subsection (a) no later than fifteen (15) days prior to the due date
thereof. Such Indemnified Person shall, upon the Indemnity Provider’s request
and at the Indemnity Provider’s expense, provide any data maintained by such
Indemnified Person (and not otherwise available to or within the control of the
Indemnity Provider) with respect to the Property which the Indemnity Provider
may reasonably require to prepare any required tax returns or reports. If an
Indemnified Person or an Affiliate receives notification from a taxing authority
having jurisdiction over the Indemnified Person or the Property that an
Imposition has been or will be imposed or a filing is required in connection
therewith for which indemnification is required to be provided by the Indemnity
Provider hereunder, then such Indemnified Person shall provide prompt written
notice thereof to the Indemnity Provider; provided, however, the failure of the
Indemnified Person to provide any such notice shall not relieve the Indemnity
Provider of its obligations hereunder except to the extent that the failure by
the Indemnified Person to provide such notice actually and materially expands
the obligations (including any increase in the amount of any indemnity) of the
Indemnity Provider hereunder.

If an Indemnified Person or an Affiliate with whom such Indemnified Person files
a consolidated tax return, or equivalent, subsequently receives the refund of an
amount that such Indemnified Person determines in its sole discretion to be
indemnified hereunder, then, so long as no Event of Default shall exist and be
continuing, such Indemnified Person shall pay the amount of such refund,
together with the amount of interest actually received thereon, if any, to the
Indemnity Provider; provided, however, if any refund or other amount shall ever
be subject to reclaim or otherwise be required to be returned or repaid to the
applicable taxing authority that issued such refund, then the amount subject to
the reclaim or otherwise required to be repaid to such tax authority shall be
deemed to be an Imposition for which Indemnity Provider shall be responsible to
indemnify and hold harmless such Indemnified Person.

(e) As between the Indemnity Provider on one hand, and each Financing Party on
the other hand, the Indemnity Provider shall be responsible for, and the
Indemnity Provider shall indemnify and hold harmless each Financing Party
(without duplication of any indemnification required by subsection (a)) on an
After Tax Basis against, any obligation for United States or foreign withholding
taxes or similar levies, imposts, charges, fees, deductions or withholdings

 

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(collectively, “Withholdings”) imposed in respect of the interest payable on the
Credit Loans or the Mortgage Loans or Lessor Yield payable on the Lessor Advance
or with respect to any other payments under the Operative Agreements (all such
payments being referred to herein as “Exempt Payments” to be made without
deduction, withholding or set off) (and, if any Financing Party receives a
demand for such payment from any taxing authority or a Withholding is otherwise
required with respect to any Exempt Payment, the Indemnity Provider shall
discharge such demand on behalf of such Financing Party); provided, however,
that the obligation of the Indemnity Provider under this Section 11.2(e) shall
not apply to:

(i) Withholdings on any Exempt Payment to any Financing Party which is a
non-U.S. Person unless such Financing Party is, on the date hereof (or on the
date it becomes a Financing Party hereunder) and on the date of any change in
the principal place of business or the lending office of such Financing Party,
entitled to submit a Form W-8BEN or Form W-8ECI or successor applicable form,
certifying in each case that such party is entitled under Section 1441 or 1442
of the Code or any other applicable provision thereof or under any applicable
tax treaty or convention to receive payments pursuant to the Operative
Agreements without deduction or withholding of United States federal income tax
and is a foreign Person thereby entitled to an exemption from United States
backup withholding taxes (except where the failure of the exemption results from
a change in the principal place of business of the Lessee); provided, however,
if a failure of the exemption is due to a Change in Law after the date hereof or
in the case of a Financing Party that acquires its interest after the date
hereof, a Change in Law occurring after such date, then the Indemnity Provider
shall be liable for any withholding resulting therefrom; or

(ii) Any U.S. Taxes imposed solely by reason of the failure by a non-U.S. Person
to comply with applicable certification, information, documentation or other
reporting requirements concerning the nationality, residence, identity or
connections with the United States of America of such non-U.S. Person if such
compliance is required by statute or regulation of the United States of America
as a precondition to relief or exemption from such U.S. Taxes if the Indemnity
Provider has provided such certification, information, documentation or other
reporting requirements to the Financing Party on a timely basis and the
Financing Party is eligible for such relief or exemption.

For the purposes of this Section 11.2(e), (A) “U.S. Person” shall mean a
citizen, national or resident of the United States of America, a corporation,
partnership or other entity created or organized in or under any laws of the
United States of America or any State thereof, or any estate or trust that is
subject to Federal income taxation regardless of the source of its income,
(B) “U.S. Taxes” shall mean any present or future tax, assessment or other
charge or levy imposed by or on behalf of the United States of America or any
taxing authority thereof or therein, (C) “Form W-8BEN” shall mean Form W-8BEN
(Certificate of Foreign Status of Beneficial Owner for United States
Withholding) of the Department of the Treasury of the United States of America
and (D) “Form W-8ECI” shall mean Form W-8ECI (Certificate of Foreign Person’s
Claim for Exemption from Withholding on Income Effectively Connected with the
Conduct of a Trade or Business in the United States) of the Department of the
Treasury of the United States of America (or in relation to either such Form
such successor and related forms as may from time to time be adopted by the
relevant taxing authorities of the United States of America to document a claim
to which such Form relates). Each of the Forms referred to in the foregoing
clauses (C) and (D) shall include such successor and related forms as may from
time to time be adopted by the relevant taxing authorities of the United States
of America to document a claim to which such Form relates.

 

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If a Financing Party or an Affiliate with whom such Financing Party files a
consolidated tax return (or equivalent) subsequently receives the benefit in any
country of a tax credit or an allowance resulting from U.S. Taxes with respect
to which it has received a payment of an additional amount under this
Section 11.2(e), such Financing Party will pay to the Indemnity Provider such
part of that benefit as in the opinion of such Financing Party will leave it
(after such payment) in a position no more and no less favorable than it would
have been in if no additional payment had been required to be paid, provided
always that (i) such Financing Party will be the sole judge of the amount of any
such benefit and of the date on which it is received, (ii) such Financing Party
will have the absolute discretion as to the order and manner in which it employs
or claims tax credits and allowances available to it and (iii) such Financing
Party will not be obliged to disclose to the Borrower any information regarding
its tax affairs or tax computations. A subsequent loss of such tax credit or
allowance with respect to which a payment is made pursuant to this paragraph to
an Indemnity Provider shall be treated as an Imposition that is indemnifiable
under Section 11.2(a) hereof without regard to the exclusions of
Sections 11.2(b)(i), (ii), and (iii) hereof.

Each non-U.S. Person that shall become a Financing Party after the date hereof
shall, upon the effectiveness of the related transfer or otherwise upon becoming
a Financing Party hereunder, be required to provide all of the forms and
statements referenced above or other evidences of exemption from Withholdings if
the Indemnity Provider has provided such certification, information,
documentation or other reporting requirements to the Financing Party and the
Financing Party is eligible for such relief or exemption.

(f) If a written Claim is made against any Indemnified Person or if any
proceeding shall be commenced against such Indemnified Person (including without
limitation a written notice of such proceeding), for any Impositions, the
provisions in Section 11.1 relating to notification and rights to contest shall
apply; provided, however, that the Indemnity Provider shall have the right to
conduct and control such contest only if such contest involves a Tax other than
a Tax on net income of the Indemnified Person that can be pursued independently
from any other proceeding involving a Tax liability of such Indemnified Person
and the Indemnity Provider agrees to pay to such Indemnified Person on demand
the Impositions which are the subject of such claim to the extent the contest is
unsuccessful. The controlling party shall provide the non-controlling party with
a copy of (or appropriate excerpts from) any reports or claims issued by the
relevant auditing agents or taxing authority to the controlling party thereof,
in connection with such claim or the contest thereof.

11.3 Increased Costs, Illegality, etc.

Subject to and limited by in all respects the provisions of this Section 11.3
and Sections 11.7 and 11.8:

(a) (i) If any Change in Law shall:

(A) impose, modify or deem applicable any reserve, special deposit or similar
requirement against assets of, deposits with or for the account of, or credit
extended by, any Financing Party (except any such reserve requirement reflected
in the Eurodollar Rate plus the Applicable Percentage); or

 

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(B) impose on any Financing Party or the London interbank market any other
condition affecting this Agreement or any other Operative Agreement or any
Financing made by such Financing Party;

and the result of any of the foregoing shall be to increase the cost to such
Financing Party of making or maintaining any Financing (or of maintaining its
obligation to make its Credit Loan, make its Mortgage Loan or make its Lessor
Advance ) or to reduce the amount of any sum received or receivable by such
Financing Party hereunder or pursuant to any other Operative Agreement (whether
of principal, interest, Lessor Yield or otherwise), then the Lessee will pay or
cause to be paid to such Financing Party such additional amount or amounts as
will compensate such Financing Party for such additional costs incurred or
reduction suffered.

(ii) If any Financing Party determines that any Change in Law regarding capital
requirements has or would have the effect of reducing the rate of return on such
Financing Party’s capital or on the capital of such Financing Party’s holding
company, if any, as a consequence of this Agreement or any other Operative
Agreement or the Credit Loans made, the Mortgage Loans made, or Lessor Advance
made, by such Financing Party to a level below that which such Financing Party
or such Financing Party’s holding company could have achieved but for such
Change in Law (taking into consideration such Financing Party’s policies and the
policies of such Financing Party’s holding company with respect to capital
adequacy), then from time to time the Lessee will pay or cause to be paid to
such Financing Party such additional amount or amounts as will compensate such
Financing Party or such Financing Party’s holding company for any such reduction
suffered.

(iii) A certificate of a Financing Party setting forth in reasonable detail the
amount or amounts necessary to compensate such Financing Party or its holding
company, as the case may be, as specified in paragraphs (a)(i) or (a)(ii) of
this Section 11.3 shall be delivered to the Lessee and shall be conclusive
absent manifest error. The Lessee shall pay or cause to be paid to such
Financing Party the amount shown as due on any such certificate within ten
(10) days after receipt thereof.

(iv) Failure or delay on the part of any Financing Party to demand compensation
pursuant to this Section 11.3 shall not constitute a waiver of such Financing
Party’s right to demand such compensation; provided, that the Lessee shall not
be required to compensate or cause to be compensated a Financing Party pursuant
to this Section 11.3 for any increased costs or reductions incurred more than
270 days prior to the date that such Financing Party notifies the Lessee of the
Change in Law giving rise to such increased costs or reductions and of such
Financing Party’s intention to claim compensation therefor; provided, further,
that, if the Change in Law giving rise to such increased costs or reductions is
retroactive, then the 270-day period referred to above shall be extended to
include the period of retroactive effect thereof.

(b) If any Financing Party determines that compliance with any Change in Law or
regulation or any guideline or request from any central bank or other
governmental authority (whether or not having the force of law, but in each case
promulgated or made after the date hereof) affects or would affect the amount of
capital required or expected to be maintained by such Financing Party or any
corporation controlling such Financing Party and that the amount of such capital
is increased by or based upon the existence of such Financing Party’s commitment
to make its portion of the Advance and other commitments of this type or upon
the Advance, then,

 

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upon demand by such Financing Party (with a copy of such demand to the Agent),
the Lessee shall pay to the Agent for the account of such Financing Party, from
time to time as specified by such Financing Party, additional amounts sufficient
to compensate such Financing Party or such corporation in the light of such
circumstances, to the extent that such Financing Party reasonably determines
such increase in capital to be allocable to the existence of such Financing
Party’s commitment to make its portion of the Advance. A certificate as to such
amounts submitted to the Lessee and the Agent by such Financing Party shall be
conclusive and binding for all purposes, absent manifest error.

(c) [Reserved].

(d) Without affecting its rights under Sections 11.3(a) or 11.3(b) or any other
provision of any Operative Agreement, each Financing Party agrees that if there
is any increase in any cost to or reduction in any amount receivable by such
Financing Party with respect to which the Lessee would be obligated to
compensate such Financing Party pursuant to Sections 11.3(a) or 11.3(b), such
Financing Party shall use reasonable efforts to select an alternative office for
its portion of the Advance which would not result in any such increase in any
cost to or reduction in any amount receivable by such Financing Party; provided,
however, that no Financing Party shall be obligated to select an alternative
office for Advances if such Financing Party determines that (i) as a result of
such selection such Financing Party would be in violation of any applicable law,
regulation, treaty, or guideline, or would incur additional costs or expenses or
(ii) such selection would be inadvisable for regulatory reasons or materially
inconsistent with the interests of such Financing Party.

(e) With reference to the obligations of the Lessee set forth in
Sections 11.3(a) through 11.3(d), the Lessee shall not have any obligation to
pay to any Financing Party amounts owing under such Sections for any period
which is more than one (1) year prior to the date upon which the request for
payment therefor is delivered to the Lessee.

(f) Notwithstanding any other provision of this Agreement, if (1) any Financing
Party shall notify the Agent that the introduction of or any change in or in the
interpretation of any law or regulation makes it unlawful, or any central bank
or other governmental authority asserts that it is unlawful, for any Financing
Party to perform its obligations hereunder to purchase, make or maintain any
Eurodollar Financing or (2) the Majority Secured Parties have determined and
have advised the Agent that the Eurodollar Rate will not adequately and fairly
reflect the cost to such parties of making or maintaining Loans or Lessor
Advances, as the case may be, at such a rate, then (i) each Eurodollar Financing
will automatically, at the earlier of the end of the then current Interest
Period for such Eurodollar Financing or the date required by law, convert into
an ABR Financing and (ii) the obligation of the Financing Parties to purchase,
make, convert or continue any Eurodollar Financing shall be suspended until the
Agent shall notify the Lessee that such Financing Party has determined (in the
case of the foregoing subsection (1)) or the Majority Secured Parties have
determined (in the case of the foregoing subsection (2)) that the circumstances
causing such suspension no longer exist.

11.4 Funding/Contribution Indemnity.

Subject to and limited by in all respects the provisions of this Section 11.4
and Sections 11.7 and 11.8, the Lessee agrees to indemnify each Financing Party
and to hold each Financing Party harmless from any loss or reasonable expense
which such Financing Party may sustain or incur as a consequence of (a) any
default in connection with the drawing of funds for any Advance, (b) the fact
that any anticipated prepayment, conversion or continuation of a Eurodollar
Financing does not occur as indicated by notices

 

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given in accordance with the provisions of the Operative Agreements or (c) the
making of a voluntary or involuntary prepayment of Eurodollar Financings on a
day which is not the last day of an Interest Period with respect thereto. Such
indemnification shall extend to and include an amount equal to the excess, if
any, of (x) the amount of interest or Lessor Yield, as the case may be, which
would have accrued on the amount so prepaid, or not so borrowed, accepted,
converted or continued for the period from the date of such prepayment or of
such failure to borrow, accept, convert or continue to the last day of such
Interest Period (or, in the case of a failure to borrow, accept, convert or
continue, the Interest Period that would have commenced on the date of such
failure) in each case at the applicable Eurodollar Rate plus the Applicable
Percentage for such Eurodollar Financing for such Interest Period over (y) the
amount of interest (as determined by such Financing Party in its reasonable
discretion) which would have accrued to such Financing Party on such amount by
reemploying such funds in loans of the same type and amount during the period
from the date of prepayment or failure to borrow to the last day of the then
applicable Interest Period (or, in the case of a failure to borrow, the Interest
Period that would have commenced on the date of such failure). This covenant
shall survive the termination of the Operative Agreements and the payment of all
other amounts payable hereunder.

11.5 EXPRESS INDEMNIFICATION FOR ORDINARY NEGLIGENCE, STRICT LIABILITY, ETC.

WITHOUT LIMITING THE GENERALITY OF THE INDEMNIFICATION PROVISIONS OF ANY AND ALL
OF THE OPERATIVE AGREEMENTS AND TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH
PERSON PROVIDING INDEMNIFICATION OF ANOTHER PERSON UNDER ANY OPERATIVE AGREEMENT
HEREBY FURTHER EXPRESSLY RELEASES EACH BENEFICIARY OF ANY SUCH INDEMNIFICATION
FROM ALL CLAIMS FOR LOSS OR DAMAGE, DESCRIBED IN ANY OPERATIVE AGREEMENT, CAUSED
BY ANY ACT OR OMISSION ON THE PART OF ANY SUCH BENEFICIARY ATTRIBUTABLE TO THE
ORDINARY NEGLIGENCE (WHETHER SOLE OR CONTRIBUTORY) OR STRICT LIABILITY OF ANY
SUCH BENEFICIARY, AND INDEMNIFIES, EXONERATES AND HOLDS EACH SUCH BENEFICIARY
FREE AND HARMLESS FROM AND AGAINST ANY AND ALL ACTIONS, CAUSES OF ACTION, SUITS,
CLAIMS, LOSSES, COSTS, LIABILITIES, DAMAGES AND EXPENSES (INCLUDING WITHOUT
LIMITATION REASONABLE ATTORNEY’S FEES AND EXPENSES), DESCRIBED ABOVE, INCURRED
BY ANY SUCH BENEFICIARY (IRRESPECTIVE OF WHETHER ANY SUCH BENEFICIARY IS A PARTY
TO THE ACTION FOR WHICH INDEMNIFICATION UNDER THIS AGREEMENT OR ANY OTHER
OPERATIVE AGREEMENT IS SOUGHT) ATTRIBUTABLE TO THE ORDINARY NEGLIGENCE (WHETHER
SOLE OR CONTRIBUTORY) OR STRICT LIABILITY OF ANY SUCH BENEFICIARY.

11.6 Additional Provisions regarding Environmental Indemnification.

Subject to and limited by in all respects the provisions of this Section 11.6
and Sections 11.7 and 11.8, each and every Indemnified Person shall at all times
have the rights and benefits, and the Indemnity Provider shall have the
obligations, in each case provided pursuant to the Operative Agreements with
respect to Environmental Matters (including without limitation the rights and
benefits provided pursuant to Section 11.1(c)).

 

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11.7 Cooperation with the Indemnity Provider.

Each Indemnified Person agrees to cooperate in a reasonable manner (but at the
expense of the Indemnity Provider) with the Indemnity Provider in responding to
any Claim covered by the indemnities referenced in the Operative Agreements.

11.8 Time Period in which Claims may arise and be Covered by Indemnification.

The basis for any Claim which is subject to indemnification coverage by the
Indemnity Provider pursuant to Sections 11.1 through 11.6 must occur or arise on
or before the date on which all of the Notes and the Lessor Advance and all
other amounts owing to any Financing Party by the Lessee are paid in full,
notwithstanding that any Claim may not be filed or otherwise initiated until a
date which is later than any date referenced in this Section 11.8.

SECTION 12

MISCELLANEOUS

12.1 Survival of Agreements.

The representations, warranties, covenants, indemnities and agreements of the
parties provided for in the Operative Agreements, and the parties’ obligations
under any and all thereof, shall survive the execution and delivery of this
Agreement, the transfer of the Property to the Lessor, the acquisition of the
Property (or any of its components), any disposition of any interest of the
Lessor in the Property, the payment of the Credit Loans, the Mortgage Loans and
the Lessor Advance and any disposition thereof and shall be and continue in
effect notwithstanding any investigation made by any party and the fact that any
party may waive compliance with any of the other terms, provisions or conditions
of any of the Operative Agreements. Except as otherwise expressly set forth
herein or in other Operative Agreements, the indemnities of the parties provided
for in the Operative Agreements shall survive the expiration or termination of
any thereof.

 

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12.2 Notices.

All notices required or permitted to be given under any Operative Agreement
shall be in writing. Notices may be served by certified or registered mail,
postage paid with return receipt requested; by private courier, prepaid; by
telex, facsimile, or other telecommunication device capable of transmitting or
creating a written record; or personally. Mailed notices and couriered notices
shall be deemed delivered when delivered as addressed, or if the addressee
refuses delivery, when presented for delivery notwithstanding such refusal.
Telex or telecommunicated notices shall be deemed delivered when receipt is
either confirmed by confirming transmission equipment or acknowledged by the
addressee or its office. Personal delivery shall be effective when accomplished.
Unless a party changes its address by giving notice to the other party as
provided herein, notices shall be delivered to the parties at the following
addresses:

If to the Lessee, to such entity at the following address:

Convergys Corporation

Atrium One

201 East Fourth Street

P.O. Box 1638

Cincinnati, Ohio 45202

Attention: David R. Wiedwald, Treasurer

Telephone: (513) 723-7830

Fax: (513) 723-6556

Email: david.r.wiedwald@convergys.com

with a copy to:

Frost Brown Todd

Attention: Frederick W. Kindel

201 E. Fifth Street

Suite 2200

Cincinnati, Ohio 45202

Telephone: (513) 651-6965

Fax: (513) 651-6981

Email: fkindel@fbtlaw.com

If to any Guarantor, to such entity in care of Convergys Corporation at the
following address:

Convergys Corporation

Atrium One

201 East Fourth Street

P.O. Box 1638

Cincinnati, Ohio 45202

Attention: David R. Wiedwald, Treasurer

Telephone: (513) 723-7830

Fax: (513) 723-6556

Email: david.r.wiedwald@convergys.com

with a copy to:

Frost Brown Todd

Attention: Frederick W. Kindel

201 E. Fifth Street

Suite 2200

Cincinnati, Ohio 45202

Telephone: (513) 651-6965

Fax: (513) 651-6981

Email: fkindel@fbtlaw.com

 

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If to the Borrower or the Lessor, to such entity at the following address:

Wachovia Development Corporation

c/o Wells Fargo Securities, LLC

MAC D1053-082

301 South College Street, 8th Floor

Charlotte, North Carolina 28288

Attention: Jack Altmeyer

Telephone: (704) 715-8122

Fax: (704) 383-3556

with a copy to:

Wells Fargo Bank, National Association

230 West Monroe Street, Suite 2900

Chicago, Illinois 60606

Attention: Steve Buehler

Telephone: (312) 845-4220

Fax: (312) 553-4783

If to the Agent, to it at the following address:

Wells Fargo Bank, National Association

c/o Wells Fargo Securities, LLC

MAC D1053-082

301 South College Street, 8th Floor

Charlotte, North Carolina 28288

Attention: Jack Altmeyer

Telephone: (704) 715-8122

Fax: (704) 383-3556

with a copy to:

Wells Fargo Bank, National Association

230 West Monroe Street, Suite 2900

Chicago, Illinois 60606

Attention: Steve Buehler

Telephone: (312) 845-4220

Fax: (312) 553-4783

If to any Credit Lender, to it at the address set forth for such Credit Lender
in Schedule 2.1 to the Credit Note Loan Agreement.

If to any Mortgage Lender, to it at the address set forth for such Mortgage
Lender in Schedule 2.1 to the Mortgage Note Loan Agreement.

From time to time any party may designate additional parties and/or another
address for notice purposes by notice to each of the other parties hereto. Each
notice hereunder shall be effective upon receipt or refusal thereof.

 

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12.3 Counterparts.

This Agreement may be executed by the parties hereto in separate counterparts,
each of which when so executed and delivered shall be an original, but all such
counterparts shall together constitute but one (1) and the same instrument.

12.4 Terminations, Amendments, Waivers, Etc.; Unanimous Vote Matters.

Each of the parties hereto agrees that:

(a) except as expressly provided in subsections (b) and (c) below and except for
the Unanimous Vote Matters, each Operative Agreement may only be terminated,
amended, modified, extended supplemented, restated, replaced or waived upon the
approval in writing by the Borrower (to the extent the Borrower is a party to
such Operative Agreement in its capacity as “borrower” and to the extent such
termination, amendment, waiver or modification increases the Obligations or has
a material adverse effect on the Borrower), the Agent (to the extent the Agent’s
rights or obligations are affected by such termination, amendment or
modification), the Majority Secured Parties and the Lessee (to the extent the
Lessee is a party to such Operative Agreement); provided, each termination,
amendment, modification, extension, supplement, restatement, replacement or
waiver regarding any Operative Agreement, which adversely affects the rights of
the Lessee shall also require the written consent of the Lessee (not to be
unreasonably withheld or delayed) unless a Lease Default or Lease Event of
Default shall have occurred and be continuing, provided, further, that each
termination, amendment, modification, extension, supplement, restatement,
replacement or waiver regarding any Operative Agreement shall also require the
written consent of each Financing Party affected thereby (the “Unanimous Vote
Matters”), so as to

(i) extend the scheduled date of maturity of any Note;

(ii) extend the scheduled Expiration Date or extend any payment date of any
Credit Loan, Mortgage Loan or Lessor Advance;

(iii) change the stated rate of interest payable on any Credit Loan or Mortgage
Loan or reduce the stated Lessor Yield payable on the Lessor Advance (other than
as a result of waiving the applicability of any post-default increase in
interest rates or Lessor Yield);

(iv) modify the priority of any Lien in favor of the Agent under any Security
Document;

(v) subordinate any obligation owed to such Credit Lender, such Mortgage Lender
or the Lessor;

(vi) terminate, amend, supplement, waive, discharge or modify any provision of
this Section 12.4 or change the percentages specified in the definitions of
Majority Credit Lenders, Majority Mortgage Lenders or Majority Secured Parties;

(vii) release a material portion of the Collateral (except in accordance with
Section 8.8);

 

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(viii) release the Borrower or the Lessee or any Guarantor from its obligations
under any Operative Agreement or otherwise alter any payment obligations
(including, without limitation, any principal prepayment provisions) of the
Borrower or the Lessee or any Guarantor to the Lessor or any Financing Party
under the Operative Agreements;

(ix) terminate, amend, supplement, waive, discharge or modify any provision of
Sections 8.6 or 8.7 of this Agreement;

(x) impose any additional affirmative obligation or requirement on the
applicable Financing Party, make any existing obligations of the applicable
Financing Party materially more onerous, or further obligate, prohibit or
restrict the applicable Financing Party or its right, title or interest under
the Operative Agreements in any material manner; or

(xi) modify or amend any definition so as to affect the matters described in the
foregoing (i)-(x).

(b) No Mortgage Instrument (nor any UCC Financing Statement related thereto) may
be terminated, amended, modified, extended (other than by UCC Financing
Statement continuations or extensions), supplemented, restated, replaced or
waived without the approval in writing by the Borrower, the Majority Mortgage
Lenders, and (to the extent relating to the Lessee as opposed to relating to the
Borrower) the Lessee.

(c) each termination, amendment, modification, extension, supplement,
restatement, replacement or waiver regarding any Operative Agreement affecting
Sections 4.1, 8.2, 8.3, 9.1, 10.1, 10.2, 11.1, 12.1, 13.1, 13.2, 14.1, 14.2,
14.3, 15.1, 15.2, 15.3, 16.1, 16.2, 18.1, 19.1, 19.2, 20.2, 20.3 (excluding all
provisions related to payments in Sections 20.2 or 20.3), 22.1, 22.4, 22.5, 23.1
or 24.1 of the Lease or affecting in any way the Collateral, including the
Property, requires the consent of the Majority Mortgage Lenders.

(d) Notwithstanding any acquisition by the Lessee or any Affiliate of the Lessee
of any interest in any Financing, no such party (hereinafter a “Related
Financing Party”) shall have any voting rights pursuant to the Operative
Agreements as a Primary Financing Party. Without limiting the generality of the
foregoing, with respect to calculating the voting percentage, any Financing held
by a Related Financing Party shall be treated as if the balance on such
Financing was zero and the Commitment with respect to such Financing was zero.

Upon the occurrence and during the continuation of any Lease Default or Lease
Event of Default, the rights of each Related Financing Party to any and all
amounts otherwise payable to such Related Financing Party pursuant to the
Operative Agreements shall be subordinated and deferred (and the rights of each
Related Financing Party to such amounts shall be voided without further action
for the duration of any such Lease Default or Lease Event of Default) until such
time as all amounts payable to all other parties to any of the Operative
Agreements have been paid in full.

NOTHING IN THIS SECTION 12.4(d) SHALL BE DEEMED TO CONSTITUTE A RIGHT OF, OR A
GRANT OF ANY RIGHT TO, THE LESSEE OR ANY AFFILIATE OF THE LESSEE TO ACQUIRE ANY
PORTION OF THE FINANCING OR TO CAUSE ANY PRIMARY FINANCING PARTY TO SELL OR
ASSIGN ANY PART OF THE FINANCING TO THE LESSEE OR ANY AFFILIATE OF THE LESSEE.

 

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Any such termination, amendment, supplement, waiver, discharge or modification
approved, executed, adopted or consented to in conformity with this Section 12.4
shall apply equally to each of the Credit Lenders, the Mortgage Lenders and the
Lessor and shall be binding upon all the parties to this Agreement. In the case
of any waiver, each party to this Agreement shall be restored to its former
position and rights under the Operative Agreements, and any Default or Event of
Default waived shall be deemed to be cured and not continuing; but no such
waiver shall extend to any subsequent or other Default or Event of Default, or
impair any right consequent thereon.

12.5 Headings, etc.

The Table of Contents and headings of the various Articles and Sections of this
Agreement are for convenience of reference only and shall not modify, define,
expand or limit any of the terms or provisions hereof.

12.6 Parties in Interest.

Except as expressly provided herein, none of the provisions of this Agreement
are intended for the benefit of any Person except the parties hereto.

12.7 GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL; VENUE.

(a) THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL
BE GOVERNED BY AND CONSTRUED, INTERPRETED AND ENFORCED IN ACCORDANCE WITH THE
INTERNAL LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO THE PRINCIPLES
THEREOF RELATING TO CONFLICTS OF LAW), EXCEPT TO THE EXTENT THE LAWS OF THE
STATE WHERE THE PROPERTY IS LOCATED ARE REQUIRED TO APPLY. Any legal action or
proceeding with respect to this Agreement or any other Operative Agreement may
be brought in the courts of the State of New York or of the United States for
the Southern District of New York, and, by execution and delivery of this
Agreement, each of the parties to this Agreement hereby irrevocably accepts for
itself and in respect of its property, generally and unconditionally, the
nonexclusive jurisdiction of such courts. Each of the parties to this Agreement
further irrevocably consents to the service of process out of any of the
aforementioned courts in any such action or proceeding by the mailing of copies
thereof by registered or certified mail, postage prepaid, to it at the address
set out for notices pursuant to Section 12.2, such service to become effective
upon receipt or rejection. Nothing herein shall affect the right of any party to
serve process in any other manner permitted by Law or to commence legal
proceedings or to otherwise proceed against any party in any other jurisdiction.

(b) EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY, TO THE FULLEST
EXTENT ALLOWED BY APPLICABLE LAW, WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT, ANY OTHER OPERATIVE AGREEMENT AND FOR ANY
COUNTERCLAIM THEREIN.

(c) Each of the parties to this Agreement hereby irrevocably waives any
objection which it may now or hereafter have to the laying of venue of any of
the aforesaid actions or proceedings arising out of or in connection with this
Agreement or any other Operative Agreement brought in the courts referred to in
subsection (a) above and hereby further irrevocably waives and agrees not to
plead or claim in any such court that any such action or proceeding brought in
any such court has been brought in an inconvenient forum.

 

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Subject to the other applicable provisions of the Operative Agreements, the
parties shall have the right to proceed in any court of proper jurisdiction or
by self-help to exercise or prosecute the following remedies, as applicable:
(i) all rights to foreclose against any real or personal property or other
security by exercising a power of sale or under applicable law by judicial
foreclosure including a proceeding to confirm the sale; (ii) all rights of
self-help including peaceful occupation of real property and collection of
rents, set-off and peaceful possession of personal property; and (iii) obtaining
provisional or ancillary remedies including injunctive relief, sequestration,
garnishment, attachment, appointment of receiver and filing an involuntary
bankruptcy proceedings. Any claim or controversy with regard to any party’s
entitlement to such remedies is a Dispute.

(d) The parties to this Agreement and/or any other Operative Agreement agree
that they shall not have a remedy of special, punitive or exemplary damages
against any other party in any Dispute and hereby waive any right or claim to
special, punitive or exemplary damages they have now or which may arise in the
future in connection with any Dispute.

12.8. Severability.

Any provision of this Agreement that is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

12.9. Liability Limited.

Anything to the contrary contained in this Agreement, the Credit Note Loan
Agreement, Mortgage Note Loan Agreement, the Notes or in any other Operative
Agreement notwithstanding, no Exculpated Person shall be personally liable in
any respect for any liability or obligation arising hereunder or in any other
Operative Agreement including without limitation the payment of the principal
of, or interest on, the Notes, or for monetary damages for the breach of
performance of any of the covenants contained in the Credit Note Loan Agreement,
Mortgage Note Loan Agreement, the Notes, this Agreement or any of the other
Operative Agreements. The Financing Parties agree that, in the event any
remedies under any Operative Agreement are pursued, neither the Primary
Financing Parties nor the Agent shall have any recourse against any Exculpated
Person, for any deficiency, loss or Claim for monetary damages or otherwise
resulting therefrom and recourse shall be had solely and exclusively against the
Borrower’s Interest (excluding Excepted Payments) and the Credit Parties (with
respect to the Credit Parties’ obligations under the Operative Agreements); but
nothing contained herein shall be taken to prevent recourse against or the
enforcement of remedies against the Borrower’s Interest (excluding Excepted
Payments) in respect of any and all liabilities, obligations and undertakings
contained herein and/or in any other Operative Agreement. Notwithstanding the
provisions of this Section, nothing in any Operative Agreement shall: (i)
constitute a waiver, release or discharge of any indebtedness or obligation
evidenced by the Notes arising under any Operative Agreement or secured by any
Operative Agreement, but the same shall continue until paid or discharged; (ii)
relieve any Exculpated Person from liability and responsibility for (but only to
the extent of the damages arising by reason of): active waste knowingly
committed by any Exculpated Person with respect to the Property, any fraud,
gross negligence or willful misconduct on the part of any Exculpated Person;
(iii) relieve any Exculpated Person from liability and responsibility for (but
only to the extent of the moneys misappropriated, misapplied or not turned over)
(A) except for Excepted Payments due to Lessor or any affiliated Exculpated
Person, Indemnified Person,

 

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Affiliate, agent, officer, director or employee, misappropriation or
misapplication by the Lessor (i.e., application in a manner contrary to any of
the Operative Agreements) of any insurance proceeds or condemnation award paid
or delivered to the Lessor by any Person other than the Agent, (B) except for
Excepted Payments due to Lessor or any affiliated Exculpated Person, Indemnified
Person, Affiliate, agent, officer, director or employee, any deposits or any
escrows or amounts held by the Lessor or (C) except for Excepted Payments due to
Lessor or any affiliated Exculpated Person, Indemnified Person, Affiliate,
agent, officer, director or employee, any rent or other income or funds received
by the Lessor from the Lessee that are not turned over to the Agent; (iv) affect
or in any way limit the Agent’s rights and remedies under any Operative
Agreement with respect to the Rents and rights and powers of the Agent under the
Operative Agreements or to obtain a judgment against the Lessee’s interest in
the Property or the Agent’s rights and powers to obtain a judgment against the
Lessor or the Lessee; or (v) relieve any Exculpated Person from liability and
responsibility (A) with respect to such Person’s obligations concerning Lessor
Liens pursuant to Section 8.2(a) and the last sentence of Section 8.9(a) hereof
or (B) to the extent such liability or responsibility is attributable to any
representation or warranty of any Exculpated Person contained in Section 6.1
hereof that was false or inaccurate in any material way when made (provided,
that no deficiency judgment or other money judgment shall be enforced against
any Exculpated Person except to the extent of the Borrower’s Interest (excluding
Excepted Payments) or to the extent the Lessor may be liable as otherwise
contemplated in clauses (ii), (iii) or (v) of this Section 12.9(b)).

12.10. Rights of the Credit Parties.

If at any time all obligations (i) of the Borrower under the Credit Note Loan
Agreement, the Mortgage Note Loan Agreement, the Security Documents and the
other Operative Agreements and (ii) of the Credit Parties under the Operative
Agreements have in each case been satisfied or discharged in full, then the
Credit Parties shall be entitled to (a) terminate the Lease and guaranty
obligations under Section 6B and (b) receive all amounts then held under the
Operative Agreements and all proceeds with respect to the Property. Upon the
termination of the Lease and Section 6B pursuant to the foregoing clause (a),
the Lessor shall transfer to the Lessee all of its right, title and interest
free and clear of the Lien of the Lease, the Lien of the Security Documents and
all Lessor Liens in and to the Property and any amounts or proceeds referred to
in the foregoing clause (b) shall be paid over to the Lessee.

12.11. Further Assurances.

The parties hereto shall promptly cause to be taken, executed, acknowledged or
delivered, at the sole expense of the Lessee, all such further acts,
conveyances, documents and assurances as the other parties may from time to time
reasonably request in order to carry out and effectuate the intent and purposes
of this Agreement, the other Operative Agreements and the transactions
contemplated hereby and thereby (including without limitation the preparation,
execution and filing of any and all Uniform Commercial Code financing
statements, filings of Mortgage Instruments and other filings or registrations
which the parties hereto may from time to time request to be filed or effected).
The Lessee, at its own expense and without need of any prior request from any
other party, shall take such action as may be necessary (including without
limitation any action specified in the preceding sentence), or (if the Lessor or
the Agent shall so request) as so requested, in order to maintain and protect
all security interests provided for hereunder or under any other Operative
Agreement. In addition, in connection with the sale or other disposition of the
Property or any portion thereof, the Lessee and Lessor agree to execute such
instruments of conveyance as may be reasonably required in connection therewith.

 

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12.12. Calculations under Operative Agreements; Consents.

(a) The parties hereto agree that all calculations and numerical determinations
to be made under the Operative Agreements by the Lessor shall be made by the
Agent and that such calculations and determinations shall be conclusive and
binding on the parties hereto in the absence of manifest error; provided,
however, the Agent shall furnish (with any out-of-pocket cost or expense
incurred by the Agent to be paid by the Lessee) the Lessee, at any Credit
Party’s request, with reasonable documentation and information which
substantiates all such calculations and numerical determinations in order to
satisfy that the same are correct.

(b) The parties hereby agree that a Financing Party shall be deemed to have
acted reasonably and shall have exercised reasonable discretion in the event and
to the extent such Financing Party has withheld its consent to or refused to
approve any requested action, amendment, supplement, modification, approval or
similar matter based on a reasonable belief that the requested action,
amendment, supplement, modification, approval or similar matter will adversely
affect the rating from any Rating Agency of such Financing Party’s Notes or
Lessor Advance.

12.13. Confidentiality.

(a) Each Financing Party agrees to keep confidential any information furnished
or made available to it by any Credit Party or any of its Subsidiaries pursuant
to this Agreement that is marked confidential; provided that nothing herein
shall prevent any Financing Party from disclosing such information (a) to any
other Financing Party or any Affiliate of any Financing Party, or any officer,
director, employee, agent, or advisor of any Financing Party or Affiliate of any
Financing Party, (b) to any other Person if reasonably incidental to the
administration of the credit facility provided herein, (c) as required by any
law, rule, or regulation, (d) upon the order of any court or administrative
agency, (e) upon the request or demand of any regulatory agency or authority
having jurisdiction over any such Person (including, but not limited to, the
National Association of Insurance Commissioners), (f) that is or becomes
available to the public or that is or becomes available to any Financing Party
other than as a result of a disclosure by any Financing Party prohibited by this
Agreement, (g) in connection with any litigation to which such Financing Party
or any of its Affiliates may be a party, (h) to the extent necessary in
connection with the exercise of any remedy under this Agreement or any other
Operative Agreement, (i) subject to provisions substantially similar to those
contained in this Section, to any actual or proposed participant or assignee,
and (j) to any Rating Agency. Notwithstanding anything herein to the contrary,
“information” shall not include, and the Financing Parties may disclose without
limitation of any kind, any information with respect to the “tax treatment” and
“tax structure” (in each case, within the meaning of Treasury Regulation
Section 1.6011-4) of the transactions contemplated hereby and by the other
Operative Agreements and all materials of any kind (including opinions or other
tax analyses) that are provided to such Financing Party relating to such tax
treatment and tax structure; provided that with respect to any document or
similar item that in either case contains information concerning the tax
treatment or tax structure of the transaction as well as other information, this
sentence shall only apply to such portions of the document or similar item that
relate to the tax treatment or tax structure of the transactions contemplated
hereby and by the other Operative Agreements.

(b) Neither the Borrower nor the Lessee will publish or give to any creditor or
prospective creditor of the Borrower or the Lessee any copy, statement or
summary (or acquiesce in the publication or giving of any such copy, statement
or summary) as to the subordination of the rights of the Credit Lenders under
the Intercreditor Agreement or otherwise without also

 

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stating or causing to be stated (in a conspicuous manner in the case of any
document) that such subordination is solely for the benefit of the purchasers of
Mortgage Obligations, and is not for the benefit of any other creditor of the
Borrower or the Lessee.

12.14. Financial Reporting/Tax Characterization.

Lessee agrees to obtain advice from its own accountants and tax counsel
regarding the financial reporting treatment and the tax characterization of the
transactions described in the Operative Agreements. Lessee further agrees that
Lessee shall not rely upon any statement of any Financing Party or any of their
respective Affiliates and/or Subsidiaries regarding any such financial reporting
treatment and/or tax characterization.

12.15. Set-off.

In addition to any rights now or hereafter granted under applicable Law and not
by way of limitation of any such rights, upon and after the occurrence of any
Event of Default and during the continuance thereof, the Credit Lenders, the
Mortgage Lenders, the Lessor, their respective Affiliates and any assignee or
participant of a Credit Lender, a Mortgage Lender or the Lessor in accordance
with the applicable provisions of the Operative Agreements are hereby authorized
by the Credit Parties at any time or from time to time, without notice to the
Credit Parties or to any other Person, any such notice being hereby expressly
waived, to set-off and to appropriate and to apply any and all deposits (general
or special, time or demand, including without limitation indebtedness evidenced
by certificates of deposit, whether matured or unmatured) and any other
indebtedness at any time held or owing by the Credit Lenders, the Mortgage
Lenders, the Lessor, their respective Affiliates or any assignee or participant
of a Credit Lender, a Mortgage Lender or the Lessor in accordance with the
applicable provisions of the Operative Agreements to or for the credit or the
account of any Credit Party against and on account of the obligations of any
Credit Party under the Operative Agreements irrespective of whether or not
(a) the Credit Lenders, the Mortgage Lenders, or the Lessor shall have made any
demand under any Operative Agreement or (b) the Agent shall have declared any or
all of the obligations of any Credit Party under the Operative Agreements to be
due and payable and although such obligations shall be contingent or unmatured.
Notwithstanding the foregoing, neither the Agent nor any other Financing Party
shall exercise, or attempt to exercise, any right of setoff, banker’s lien, or
the like, against any deposit account or property of any Credit Party held by
the Agent or any other Financing Party, without the prior written consent of the
Agent (acting upon the direction of the Secured Parties in accordance with the
Intercreditor Agreement), and any Financing Party violating this provision shall
indemnify the Agent and the other Financing Parties from any and all costs,
expenses, liabilities and damages resulting therefrom. The contractual
restriction on the exercise of setoff rights provided in the foregoing sentence
is solely for the benefit of the Agent and the Financing Parties and may not be
enforced by the Lessee.

[signature pages follow]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective officers thereunto duly authorized as of the day
and year first above written.

LESSEE:

 

CONVERGYS CORPORATION, as the Lessee By:  

 

Name:  

 

Title:  

 

 

(signature pages continue)

Amended and Restated Participation Agreement

Convergys Corporation

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

GUARANTORS:

 

CONVERGYS CUSTOMER MANAGEMENT

GROUP Inc., as a Guarantor

By:  

 

Name:  

 

Title:  

 

CONVERGYS INFORMATION MANAGEMENT

GROUP INC., as a Guarantor

By:  

 

Name:  

 

Title:  

 

CONVERGYS CMG UTAH, INC., as a Guarantor By:  

 

Name:  

 

Title:  

 

ENCORE RECEIVABLE MANAGEMENT, INC., as a Guarantor By:  

 

Name:  

 

Title:  

 

 

(signature pages continue)

Amended and Restated Participation Agreement

Convergys Corporation

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

INTERVOICE, INC., as a Guarantor By:  

 

Name:  

 

Title:  

 

CONVERGYS GOVERNMENT SOLUTIONS LLC, as a Guarantor By:  

 

Name:  

 

Title:  

 

 

(signature pages continue)

Amended and Restated Participation Agreement

Convergys Corporation

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

BORROWER AND LESSOR:

 

WACHOVIA DEVELOPMENT CORPORATION, as the Borrower and as the Lessor By:  

 

Name:  

 

Title:  

 

 

(signature pages continue)

Amended and Restated Participation Agreement

Convergys Corporation

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

THE AGENT:

 

WELLS FARGO BANK, NATIONAL ASSOCIATION,

as the Agent

By:  

 

Name:  

 

Title:  

 

 

(signature pages continue)

Amended and Restated Participation Agreement

Convergys Corporation

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

LENDERS:

 

THE BANK OF NOVA SCOTIA, as a Credit Lender By:  

 

Name:  

 

Title:  

 

 

(signature pages continue)

Amended and Restated Participation Agreement

Convergys Corporation

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

BNP PARIBAS LEASING CORPORATION, as a Credit Lender and as a Mortgage Lender By:
 

 

Name:  

 

Title:  

 

 

(signature pages continue)

Amended and Restated Participation Agreement

Convergys Corporation

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

WELLS FARGO BANK, NATIONAL ASSOCIATION,

as a Mortgage Lender

By:  

 

Name:  

 

Title:  

 

 

(signature pages end)

Amended and Restated Participation Agreement

Convergys Corporation

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

SCHEDULE 6.2(a)

Corporate Existence Exceptions for Lessee and Subsidiaries

None.

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

SCHEDULE 6.2(f)

Disclosed Matters

None.

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

SCHEDULE 6.2(m)

Material Subsidiaries

Convergys Information Management Group Inc., an Ohio corporation

Convergys Customer Management Group Inc., an Ohio corporation

Convergys CMG Utah, Inc., a Utah corporation

Encore Receivable Management, Inc., a Kansas corporation

Intervoice, Inc., a Texas corporation

Convergys Government Solutions LLC, an Ohio limited liability company

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

SCHEDULE 8.3B.1

Existing Indebtedness

 

  1. $400,000,000 Revolving Credit Facility dated October 20, 2006 maturing
October 20, 2011

 

  2. $125,000,000 Junior Subordinated Convertible Debentures maturing
September 12, 2029

 

  3. $125,000,000 Accounts Receivable Securization dated June 30, 2009

- $75,000,000 with Wells Fargo Bank maturing June 30, 2012

- $50,000,000 with Scotia Bank maturing June 30, 2010

 

  4. 6,000,000 State of Ohio Chapter 166 Loan dated October 27, 2004 maturing
December 1, 2014

 

  5. $1,365,512 Capital Lease for Avaya Telecom equipment dated May 29, 2009
maturing May 28, 2012

 

  6. $1,503,309 Capital Lease for HP Software dated January 1, 2010 maturing
December 31, 2012

 

  7. 1,006,250 Capital Lease for IBM Software dated July 1, 2009 maturing
December 31, 2011

 

  8. $44,346,240 Letters of credit supporting international performance bonds,
rent guarantees, insurance bonds, advance payment guarantees, and security
deposits

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SCHEDULE 8.3B.6

Restrictive Agreements

None.

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EXHIBIT A

REQUISITION FORM

(Pursuant to Sections 4.2, 5.2 and 5.3 of the Participation Agreement)

CONVERGYS CORPORATION, an Ohio corporation (the “Company”), hereby certifies as
true and correct and delivers the following Requisition to WELLS FARGO BANK,
NATIONAL ASSOCIATION, as the agent for the Primary Financing Parties (such term
as hereinafter defined) and respecting the Security Documents, as the agent for
the Secured Parties (the “Agent”):

Reference is made herein to that certain Amended and Restated Participation
Agreement dated as of June 30, 2010 (as amended, modified, extended,
supplemented, restated and/or replaced from time to time, the “Participation
Agreement”) among the Company, as the lessee (the “Lessee”), the parties thereto
from time to time as guarantors, (the “Guarantors”), Wachovia Development
Corporation, as the lessor and as the borrower (the “Lessor”), the various banks
and other lending institutions which are parties thereto from time to time, as
credit lenders (the “Credit Lenders”), the various banks and other lending
institutions which are parties thereto from time to time, as mortgage lenders
(the “Mortgage Lenders”), and the Agent. Capitalized terms used herein but not
otherwise defined herein shall have the meanings set forth therefor in the
Participation Agreement.

CLOSING DATE:

(three (3) Business Days prior notice required for Advance)

 

  1. Amounts contemplated to be paid by the Lessor and the Lenders pursuant to
Section 1 of the Participation Agreement as of the Closing Date:

See attached Schedule 1A

 

  2. Description of Land (which shall be a legal description of the Land):

See attached Schedule 1

 

  3. Description of Improvements:

See attached Schedule 2

In connection with this Requisition, the Company hereby requests that the Credit
Lenders make payments in respect of the Credit Loans pursuant to the Credit
Notes in the amount of $                    , that the Mortgage Lenders make
payments in respect of the Mortgage Loans pursuant to the Mortgage Notes in the
amount of $                    , and that the Lessor make payments in respect of
the Lessor Advance in the amount of $                    . The Company hereby
certifies (i) that the foregoing amounts requested do not exceed the total
aggregate of the Credit Note Commitments, the Mortgage Note Commitments plus the
Lessor Commitments and (ii) each of the provisions of the Participation
Agreement and the other Operative Agreements applicable to the Credit Notes, the
Mortgage Notes and the Lessor Advance requested hereunder have been complied
with as of the date of this Requisition.

 

Exhibit A - 1

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

The Company requests the Credit Loans be allocated as follows:

 

$                    _

  ABR Loans

$                    

  Eurodollar Loans

The Company requests the Mortgage Loans be allocated as follows:

 

$                    

  ABR Loans $                       Eurodollar Loans

The Company requests the Lessor Advances be allocated as follows:

 

$                    

  ABR Lessor Advances

$                    

  Eurodollar Lessor Advances

The Company has caused this Requisition to be executed by its duly authorized
officer as of this         day of                    ,             .

 

CONVERGYS CORPORATION

By:

 

 

Name:

 

 

Title:

 

 

 

Exhibit A - 2

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

Schedule 1A

Assignment Amounts for Existing Debt Providers and Existing Lessor

pursuant to the Existing Operative Agreements

 

Existing Debt
Providers

  Loan Principal   Interest   Fees/Breakage/Other   Total

 

 

Existing Lessor

  Lessor Advance   Lessor Yield   Fees/Breakage/Other   Total Wachovia
Development
Corporation        

 

Exhibit A - 3

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

Schedule 1

Description of Land

(Legal Description and Street Address)

 

Exhibit A - 4

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

Schedule 2

Description of Improvements

 

Exhibit A - 5

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

EXHIBIT B

[Reserved]

 

Exhibit B - 1

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

EXHIBIT C

CONVERGYS CORPORATION

OFFICER’S CERTIFICATE

(Pursuant to Section 5.3(y) of the Participation Agreement)

CONVERGYS CORPORATION, an Ohio corporation (the “Company”), DOES HEREBY CERTIFY
as follows:

 

  1. Each and every representation and warranty of each Credit Party contained
in the Operative Agreements to which it is a party is true and correct on and as
of the date hereof.

 

  2. No Default or Event of Default has occurred and is continuing under any
Operative Agreement.

 

  3. Each Operative Agreement to which any Credit Party is a party is in full
force and effect with respect to it.

 

  4. Each Credit Party has duly performed and complied with all covenants,
agreements and conditions contained in the Participation Agreement (hereinafter
defined) or in any Operative Agreement required to be performed or complied with
by it on or prior to the date hereof.

Capitalized terms used in this Officer’s Certificate and not otherwise defined
herein have the respective meanings ascribed thereto in the Amended and Restated
Participation Agreement, dated as of June 30, 2010 among the Company, as the
Lessee, the parties thereto from time to time as Guarantors, Wachovia
Development Corporation, as the Lessor, the various banks and other lending
institutions which are parties thereto from time to time, as Credit Lenders, the
various banks and other lending institutions which are parties thereto from time
to time, as Mortgage Lenders, and Wells Fargo Bank, National Association, as the
Agent for the Primary Financing Parties and respecting the Security Documents,
as the Agent for the Secured Parties.

IN WITNESS WHEREOF, the Company has caused this Officer’s Certificate to be duly
executed and delivered as of this      day of             ,         .

 

CONVERGYS CORPORATION By:  

 

Name:  

 

Title:  

 

 

Exhibit C - 1

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

EXHIBIT D

[NAME OF CREDIT PARTY]

SECRETARY’S CERTIFICATE

(Pursuant to Section 5.3(z) of the Participation Agreement)

[NAME OF CREDIT PARTY], a              corporation (the “Company”) DOES HEREBY
CERTIFY as follows:

 

  1. Attached hereto as Schedule 1 is a true, correct and complete copy of the
resolutions of the Board of Directors of the Company duly adopted by the Board
of Directors of the Company on             . Such resolutions have not been
amended, modified or rescinded since their date of adoption and remain in full
force and effect as of the date hereof.

 

  2. Attached hereto as Schedule 2 is a true, correct and complete copy of the
Articles of Incorporation of the Company on file in the Office of the Secretary
of State of             . Such Articles of Incorporation have not been amended,
modified or rescinded since their date of adoption and were in full force and
effect on the date of the resolutions referenced in paragraph 1 and remain in
full force and effect as of the date hereof.

 

  3. Attached hereto as Schedule 3 is a true, correct and complete copy of the
Bylaws of the Company. Such Bylaws have not been amended, modified or rescinded
since their date of adoption and remain in full force and effect as of the date
hereof.

 

  4. The persons named below now hold the offices set forth opposite their
names, and the signatures opposite their names and titles are their true and
correct signatures.

 

Name

      

Office

      

Signature

 

     

 

     

 

 

     

 

     

 

IN WITNESS WHEREOF, the Company has caused this Secretary’s Certificate to be
duly executed and delivered as of this     day of             ,         .

 

[NAME OF CREDIT PARTY] By:  

 

Name:  

 

Title:  

 

 

Exhibit D - 1

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

Schedule 1

Board Resolutions

 

Exhibit D - 2

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

Schedule 2

Articles of Incorporation

 

Exhibit D - 3

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

Schedule 3

Bylaws

 

Exhibit D - 4

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

EXHIBIT E

WACHOVIA DEVELOPMENT CORPORATION

OFFICER’S CERTIFICATE

(Pursuant to Section 5.3(bb) of the Participation Agreement)

WACHOVIA DEVELOPMENT CORPORATION, a North Carolina corporation (the “Lessor”),
DOES HEREBY CERTIFY as follows:

 

  1. Each and every representation and warranty of the Lessor contained in the
Operative Agreements to which it is a party is true and correct on and as of the
date hereof.

 

  2. Each Operative Agreement to which the Lessor is a party is in full force
and effect with respect to it.

 

  3. The Lessor has duly performed and complied with all covenants, agreements
and conditions contained in the Participation Agreement (hereinafter defined) or
in any Operative Agreement required to be performed or complied with by it on or
prior to the date hereof, other than those conditions which have been expressly
waived.

 

  4. No Default or Event of Default attributable solely to the Lessor has
occurred and is continuing under any Operative Agreement.

Capitalized terms used in this Officer’s Certificate and not otherwise defined
herein have the respective meanings ascribed thereto in the Amended and Restated
Participation Agreement dated as of June 30, 2010 (as amended, modified,
extended, supplemented, restated and/or replaced from time to time, the
“Participation Agreement”) among Convergys Corporation, as the Lessee, the
various parties thereto from time to time as Guarantors, the Lessor, the various
banks and other lending institutions which are parties thereto from time to
time, as Credit Lenders, the various banks and other lending institutions which
are parties thereto from time to time, as Mortgage Lenders, and Wells Fargo
Bank, National Association, as the Agent for the Primary Financing Parties and,
respecting the Security Documents, as the Agent for the Secured Parties.

IN WITNESS WHEREOF, the Lessor has caused this Officer’s Certificate to be duly
executed and delivered as of this      day of             ,         .

 

WACHOVIA DEVELOPMENT CORPORATION

By:  

 

Name:  

 

Title:  

 

 

Exhibit E - 1

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

EXHIBIT F

WACHOVIA DEVELOPMENT CORPORATION

SECRETARY’S CERTIFICATE

(Pursuant to Section 5.3(cc) of the Participation Agreement)

CERTIFICATE OF [ASSISTANT] SECRETARY

I,                     , duly elected and qualified [Assistant] Secretary of
Wachovia Development Corporation (the “Company”), hereby certify as follows:

 

  1. Attached hereto as Schedule 1 is a true, correct and complete copy of the
resolutions of the Board of Directors of the Company duly adopted by the Board
of Directors of the Company on             . Such resolutions have not been
amended, modified or rescinded since their date of adoption and remain in full
force and effect as of the date hereof.

 

  2. Attached hereto as Schedule 2 is a true, correct and complete copy of the
Articles of Incorporation of the Company on file in the Office of the Secretary
of State of North Carolina. Such Articles of Incorporation have not been
amended, modified or rescinded since their date of adoption and were in full
force and effect on the date of the resolutions referenced in paragraph 1 and
remain in full force and effect as of the date hereof.

 

  3. Attached hereto as Schedule 3 is a true, correct and complete copy of the
Bylaws of the Company. Such Bylaws have not been amended, modified or rescinded
since their date of adoption and remain in full force and effect as of the date
hereof.

 

  4. The persons named below now hold the offices set forth opposite their
names, and the signatures opposite their names and titles are their true and
correct signatures.

 

Name       Office       Signature

 

     

 

     

 

 

     

 

     

 

IN WITNESS WHEREOF, the Company has caused this [Assistant] Secretary’s
Certificate to be duly executed and delivered as of this      day of
            ,         .

 

WACHOVIA DEVELOPMENT CORPORATION By:  

 

Name:  

 

Title:  

 

 

Exhibit F - 1

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

EXHIBIT G

[Reserved]

 

Exhibit G - 1

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

EXHIBIT H

[Reserved]

 

Exhibit H - 1

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

EXHIBIT I

[Reserved]

 

Exhibit I - 1

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

EXHIBIT J

[Reserved]

 

Exhibit J - 1

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

EXHIBIT K

[Reserved]

 

Exhibit K - 1

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

EXHIBIT L

STATES OF INCORPORATION/FORMATION AND

PRINCIPAL PLACE OF BUSINESS OF EACH CREDIT PARTY

(Pursuant to Section 6.2(o) of the Participation Agreement)

 

Credit Parties   

State of

Incorporation/Formation

  

State of Principal

Place of Business

Convergys Corporation

   Ohio    Ohio

Convergys Information Management Group Inc.

   Ohio    Ohio

Convergys Customer Management Group Inc.

   Ohio    Ohio

Convergys CMG Utah, Inc.

   Utah    Utah

Encore Receivable Management, Inc.

   Kansas    Kansas

Intervoice, Inc.

   Texas    Texas

Convergys Government Solutions LLC

   Ohio    Ohio

 

Exhibit L - 1

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

APPENDIX A

Rules of Usage and Definitions

I. Rules of Usage

The following rules of usage shall apply to this Appendix A and the Operative
Agreements (and each appendix, schedule, exhibit and annex to the foregoing)
unless otherwise required by the context or unless otherwise defined therein:

(a) Except as otherwise expressly provided, any definitions set forth herein or
in any other document shall be equally applicable to the singular and plural
forms of the terms defined.

(b) Except as otherwise expressly provided, references in any document to
articles, sections, paragraphs, clauses, annexes, appendices, schedules or
exhibits are references to articles, sections, paragraphs, clauses, annexes,
appendices, schedules or exhibits in or to such document.

(c) The headings, subheadings and table of contents used in any document are
solely for convenience of reference and shall not constitute a part of any such
document nor shall they affect the meaning, construction or effect of any
provision thereof.

(d) References to any Person shall include such Person, its successors,
permitted assigns and permitted transferees.

(e) Except as otherwise expressly provided, reference to any agreement means
such agreement as amended, modified, extended, supplemented, restated and/or
replaced from time to time in accordance with the applicable provisions thereof.

(f) Except as otherwise expressly provided, references to any law includes any
amendment or modification to such law and any rules or regulations issued
thereunder or any law enacted in substitution or replacement therefor.

(g) When used in any document, words such as “hereunder”, “hereto”, “hereof” and
“herein” and other words of like import shall, unless the context clearly
indicates to the contrary, refer to the whole of the applicable document and not
to any particular article, section, subsection, paragraph or clause thereof.

(h) References to “including” means including without limiting the generality of
any description preceding such term and for purposes hereof the rule of ejusdem
generis shall not be applicable to limit a general statement, followed by or
referable to an enumeration of specific matters, to matters similar to those
specifically mentioned.

(i) References herein to “attorney’s fees”, “legal fees”, “costs of counsel” or
other such references shall be deemed to include the allocated cost of in-house
counsel.

(j) Each of the parties to the Operative Agreements and their counsel have
reviewed and revised, or requested revisions to, the Operative Agreements, and
the usual rule of construction that any ambiguities are to be resolved against
the drafting party shall be inapplicable in the construction and interpretation
of the Operative Agreements and any amendments or exhibits thereto.

 

Appendix A - 1

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

(k) Capitalized terms used in any Operative Agreements which are not defined in
this Appendix A but are defined in another Operative Agreement shall have the
meaning so ascribed to such term in the applicable Operative Agreement.

(l) In computing any period of time for purposes of any Operative Agreement, the
mechanics for counting the number of days set forth in Rule 6 of the Federal
Rules of Civil Procedure shall be observed.

(m) Except as otherwise expressly provided in the Operative Agreements, all
terms of an accounting or financial nature shall be construed in accordance with
GAAP, as in effect from time to time; provided that, if the Lessee notifies the
Agent that the Lessee requests an amendment to any provision in any Operative
Agreement to eliminate the effect of any change occurring after the date hereof
in GAAP or in the application thereof on the operation of such provision (or if
the Agent notifies the Lessee that the Majority Secured Parties request an
amendment to any provision in any Operative Agreement for such purpose),
regardless of whether any such notice is given before or after such change in
GAAP or in the application thereof, then such provision shall be interpreted on
the basis of GAAP as in effect and applied immediately before such change shall
have become effective until such notice shall have been withdrawn or such
provision amended in accordance therewith.

II. Definitions

“ABR” shall mean, for any day, a rate per annum equal to the greater of (a) the
Prime Lending Rate in effect on such day, and (b) the Federal Funds Effective
Rate in effect on such day plus one-half of one percent (0.5%). For purposes
hereof: “Prime Lending Rate” shall mean the rate announced by the Agent from
time to time as its prime lending rate as in effect from time to time. The Prime
Lending Rate is a reference rate and is one of several interest rate bases used
by the Agent and does not necessarily represent the lowest or most favorable
rate offered by the Agent actually charged to any customer. The Lessor, any
Credit Lender or any Mortgage Lender may make commercial loans or other loans at
rates of interest at, above or below the Prime Lending Rate. The Prime Lending
Rate shall change automatically and without notice from time to time as and when
the prime lending rate of the Agent changes. “Federal Funds Effective Rate”
shall mean, for any period, a fluctuating interest rate per annum equal for each
day during such period to the weighted average of the rates on overnight Federal
funds transactions with members or the Federal Reserve System arranged by
Federal funds brokers, as published for such day (or, if such day is not a
Business Day, for the next preceding Business Day) by the Federal Reserve Bank
of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations for such day on such transactions
received by the Agent from three (3) Federal funds brokers of recognized
standing selected by it. Any change in the ABR due to a change in the Prime
Lending Rate or the Federal Funds Effective Rate shall be effective as of the
opening of business on the effective day of such change in the Prime Lending
Rate or the Federal Funds Effective Rate, respectively.

“ABR Financings” shall mean principal amounts of the Lessor Advance or principal
amounts owing under the Credit Notes or the Mortgage Notes, bearing a Lessor
Yield or rate of interest, as applicable, based upon the ABR.

“ABR Lessor Advance” shall mean principal amounts of the Lessor Advance bearing
a Lessor Yield based upon the ABR.

“ABR Loans” shall mean Credit Loans or Mortgage Loans the rate of interest
applicable to which is based upon the ABR.

 

Appendix A - 2

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

“Acceleration” shall have the meaning given to such term in Section 6 of the
Credit Note Loan Agreement and/or Section 6 of the Mortgage Note Loan Agreement.

“Accounts” shall have the meaning given to such term in Section 1 of the
Security Agreement.

“Advance” shall have the meaning given to such term in Section 5.3 of the
Participation Agreement.

“Affiliate” means, with respect to a specified Person, another Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified.

“After Tax Basis” shall mean, with respect to any payment to be received, the
amount of such payment increased so that, after deduction of the amount of all
taxes required to be paid by the recipient calculated at the then maximum
marginal rates generally applicable to Persons of the same type as the
recipients with respect to the receipt by the recipient of such amounts (less
any tax savings realized as a result of the payment of the indemnified amount),
such increased payment (as so reduced) is equal to the payment otherwise
required to be made.

“Agent” shall mean Wells Fargo Bank, National Association, as agent for the
Primary Financing Parties pursuant to the Participation Agreement, or any
successor agent appointed in accordance with the terms of the Participation
Agreement, and respecting the Security Documents, as agent for the Secured
Parties.

“Applicable Percentage” means, for any day, with respect to any Eurodollar Loan
or Eurodollar Lessor Advance or any ABR Loan or ABR Lessor Advance, as the case
may be, the applicable rate per annum set forth below under the caption
“Eurodollar Spread - Credit Loans”, “Eurodollar Spread - Mortgage Loans”,
“Eurodollar Spread - Lessor Advances”, “ABR Spread - Credit Loans”, “ABR Spread
- Mortgage Loans”, or “ABR Spread - Lessor Advances”, as the case may be, based
upon the ratings by S&P, Moody’s and Fitch, respectively, applicable on such
date to the Index Debt:

 

Index Debt Ratings

   Eurodollar Spread     ABR Spread      Credit
Loans     Mortgage
Loans     Lessor
Advances     Credit
Loans     Mortgage
Loans     Lessor
Advances  

Category 1

            

BBB- or higher/Baa3 or higher

   3.000 %    3.000 %    3.700 %    2.000 %    2.000 %    2.700 % 

Category 2

            

BB+/Ba1

   3.250 %    3.250 %    3.950 %    2.250 %    2.250 %    2.950 % 

Category 3

            

BB/Ba2

   3.500 %    3.500 %    4.200 %    2.500 %    2.500 %    3.200 % 

Category 4

            

BB-/Ba3

   3.875 %    3.875 %    4.575 %    2.875 %    2.875 %    3.575 % 

Category 5

            

lower than BB-/lower than Ba3

   4.250 %    4.250 %    4.950 %    3.250 %    3.250 %    3.950 % 

 

Appendix A - 3

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

For purposes of the foregoing, (i) if any of S&P, Moody’s or Fitch shall not
have in effect a rating for the Index Debt (other than by reason of the
circumstances referred to in the last sentence of this definition), then such
rating agency shall be deemed to have established a rating in Category 5;
(ii) if the ratings established or deemed to have been established by S&P,
Moody’s and Fitch for the Index Debt shall fall within different Categories,
(A) if two of the ratings fall within the same Category, then the Applicable
Percentage shall be determined by reference to the Category of the two same
ratings and (B) if each of the three ratings fall within different Categories,
then the Applicable Percentage shall be based on the rating that is between the
highest and the lowest ratings; and (iii) if the ratings established or deemed
to have been established by S&P, Moody’s and Fitch for the Index Debt shall be
changed (other than as a result of a change in the rating system of S&P, Moody’s
or Fitch), such change shall be effective as of the date on which it is first
announced by the applicable rating agency. Each change in the Applicable
Percentage shall apply during the period commencing on the effective date of
such change and ending on the date immediately preceding the effective date of
the next such change. If the rating system of S&P, Moody’s or Fitch shall
change, or if any such rating agency shall cease to be in the business of rating
corporate debt obligations, the Lessee, the Lessor and the Lenders shall
negotiate in good faith to amend this definition to reflect such changed rating
system or the unavailability of ratings from such rating agency and, pending the
effectiveness of any such amendment, the Applicable Percentage shall be
determined by reference to the rating most recently in effect prior to such
change or cessation.

“Appraisal” shall mean, with respect to the Property, an “as-built” appraisal to
be delivered in connection with the Participation Agreement or in accordance
with the terms of the Lease, in each case prepared by a reputable appraiser
reasonably acceptable to the Agent, which in the reasonable judgment of counsel
to the Agent, complies with all of the provisions of the Financial Institutions
Reform, Recovery and Enforcement Act of 1989, as amended, the rules and
regulations adopted pursuant thereto, and all other applicable Legal
Requirements.

“Appraisal Procedure” shall have the meaning given such term in Section 22.4 of
the Lease.

“Approved State” shall mean the State of Florida.

“Appurtenant Rights” shall mean (a) all agreements, easements, rights of way or
use, rights of ingress or egress, privileges, appurtenances, tenements,
hereditaments and other rights and benefits at any time belonging or pertaining
to the Land underlying the Improvements or the Improvements, including without
limitation the use of any streets, ways, alleys, vaults or strips of land
adjoining, abutting, adjacent or contiguous to the Land and (b) all permits,
licenses and rights, whether or not of record, appurtenant to such Land or the
Improvements.

“Assignment and Acceptance” shall mean the Assignment and Acceptance in the form
attached to the applicable Loan Agreement as Exhibit B.

“Assignment and Recharacterization Agreement” shall mean that certain Assignment
and Recharacterization Agreement dated as of the Closing Date by and among
Lessee, the Guarantors, Lessor, the Credit Lenders, the Mortgage Lenders, the
Agent, and such other parties thereto.

“Assignment of Lease” shall mean the Amended and Restated Assignment of Leases
and Rents dated as of the Closing Date from the Borrower to the Agent for the
benefit of the Secured Parties, and consented to by the Lessee.

“Bankruptcy Code” shall mean Title 11 of the U. S. Code entitled “Bankruptcy,”
as now or hereafter in effect or any successor thereto.

 

Appendix A - 4

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

“Bankruptcy Event” means with respect to any Person, any voluntary or
involuntary dissolution, winding-up, total or partial liquidation or
reorganization, or bankruptcy, insolvency, receivership or other statutory or
common law proceedings or arrangements involving such Person or the readjustment
of its liabilities or any assignment for the benefit of creditors or any
marshalling of its assets or liabilities.

“Base Eurodollar Rate” means, with respect to any Eurodollar Financing for any
Interest Period, the rate appearing on Page 3750 of the Telerate Service (or on
any successor or substitute page of such Service, or any successor to or
substitute for such Service, providing rate quotations comparable to those
currently provided on such page of such Service, as determined by the Agent from
time to time for purposes of providing quotations of interest rates applicable
to dollar deposits in the London interbank market) at approximately 11:00 a.m.,
London time, two Business Days prior to the commencement of such Interest
Period, as the rate for dollar deposits with a maturity comparable to such
Interest Period. In the event that such rate is not available at such time for
any reason, then the “Eurodollar Rate” with respect to such Eurodollar Financing
for such Interest Period shall be the rate at which dollar deposits of
$5,000,000 and for a maturity comparable to such Interest Period are offered by
the principal London office of the Agent in immediately available funds in the
London interbank market at approximately 11:00 a.m., London time, two Business
Days prior to the commencement of such Interest Period.

“Basic Documents” shall mean the following: the Participation Agreement, the
Credit Note Loan Agreement, the Mortgage Loan Note Agreement, the Notes, the
Lease and the Security Agreement.

“Basic Rent” shall mean, the sum of (a) the Credit Loan Basic Rent, (b) the
Mortgage Loan Basic Rent and (c) the Lessor Basic Rent, calculated as of the
applicable date on which Basic Rent is due.

“Basic Term” shall have the meaning given to such term in Section 2.2 of the
Lease.

“Basic Term Commencement Date” shall have the meaning specified in Section 2.2
of the Lease.

“Benefited Credit Lender” shall have the meaning specified in Section 9.10(a) of
the Credit Note Loan Agreement.

“Benefited Mortgage Lender” shall have the meaning specified in Section 9.10(a)
of the Mortgage Note Loan Agreement.

“Board” shall mean the Board of Governors of the Federal Reserve System of the
United States.

“Borrower” shall mean Wachovia Development Corporation, a North Carolina
corporation, in its capacity as the “borrower” under the Credit Note Loan
Agreement and/or under the Mortgage Note Loan Agreement and the other Operative
Agreements, and any successor, replacement and/or additional borrower expressly
permitted under the Credit Note Loan Agreement, the Mortgage Note Loan Agreement
and the other Operative Agreements.

“Borrower’s Interest” shall mean the Borrower’s rights in, to and under the
Property, the Operative Agreements, any other property contributed on behalf of
the Lessee and any and all other property or assets from time to time of the
Borrower obtained with respect to the Operative Agreements, including, without
limitation, Modifications, and all amounts of Rent, insurance proceeds and
condemnation awards, indemnity or other payments of any kind received by the
Borrower pursuant to the Operative Agreements; provided, the term “Borrower’s
Interest” shall not include the Lessor Advance or any Lessor Yield or any
Excepted Payments.

 

Appendix A - 5

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

“Business Day” shall mean a day other than a Saturday, Sunday or other day on
which commercial banks in New York or any other states from which the Agent, the
Lessor, any Mortgage Lender or any Credit Lender funds the transactions
contemplated by the Operative Agreements are authorized or required by law to
close; provided, however, that when used in connection with a Eurodollar
Financing, the term “Business Day” shall also exclude any day on which banks are
not open for dealings in dollar deposits in the London interbank market.

“Capital Lease Obligations” of any Person means the obligations of such Person
to pay rent or other amounts under any lease of (or other arrangement conveying
the right to use) real or personal property, or a combination thereof, which
obligations are required to be classified and accounted for as capital leases on
a balance sheet of such Person under GAAP, and the amount of such obligations
shall be the capitalized amount thereof determined in accordance with GAAP.

“Capital Stock” shall mean any nonredeemable capital stock of the Lessee or any
of its Subsidiaries or of any other applicable Person, whether common or
preferred.

“Casualty” shall mean any damage or destruction of all or any portion of the
Property as a result of a fire or other casualty.

“CERCLA” shall mean the Comprehensive Environmental Response, Compensation, and
Liability Act of 1980, 42 U.S.C. § 9601 et seq., as amended by the Superfund
Amendments and Reauthorization Act of 1986.

“Change in Control” means (a) the acquisition of ownership, directly or
indirectly, beneficially or of record, by any Person or group (within the
meaning of the Securities Exchange Act of 1934 and the rules of the Securities
and Exchange Commission thereunder as in effect on the date hereof), of shares
representing more than 25% of the aggregate ordinary voting power represented by
the issued and outstanding capital stock of the Lessee; (b) occupation of a
majority of the seats (other than vacant seats) on the board of directors of the
Lessee by Persons who were neither (i) nominated by the board of directors of
the Lessee nor (ii) appointed by directors so nominated; or (c) the acquisition
of direct or indirect Control of the Lessee by any Person or group.

“Change in Law” means the occurrence, after the Closing Date, 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.

“Chattel Paper” shall have the meaning given to such term in Section 1 of the
Security Agreement.

“Claims” shall mean any and all obligations, liabilities, losses, actions,
suits, penalties, claims, demands, costs and expenses (including without
limitation reasonable attorney’s fees and expenses) of any nature whatsoever.

“Closing Date” shall mean June 30, 2010.

“Code” shall mean the Internal Revenue Code of 1986 together with rules and
regulations promulgated thereunder, as amended from time to time, or any
successor statute thereto.

 

Appendix A - 6

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“Collateral” shall mean all assets of the Borrower or the Lessee, now owned or
hereafter acquired, upon which a Lien is purported to be created by one or more
of the Security Documents.

“Commitment Percentage” shall mean, as to any Primary Financing Party at any
time, the percentage which such Primary Financing Party’s Commitment then
constitutes of the aggregate Commitments (or, at any time after the Commitments
shall have expired or terminated, the percentage which the aggregate principal
amount of such Primary Financing Party’s Financing then outstanding constitutes
of the aggregate principal amount of all of the Financing then outstanding).

“Commitments” shall mean the Credit Note Commitments of each Credit Lender as
set forth in Schedule 2.1 to the Credit Note Loan Agreement, as such
Schedule 2.1 may be amended or replaced from time to time, the Mortgage Note
Commitments of each Mortgage Lender as set forth in Schedule 2.1 to the Mortgage
Note Loan Agreement, as such Schedule 2.1 may be amended or replaced from time
to time, and the Lessor Commitment of the Lessor.

“Company Obligations” shall mean the obligations of Convergys, in any and all
capacities under and with respect to the Operative Agreements and the Property.

“Condemnation” shall mean any taking or sale of the use, access, occupancy,
easement rights or title to the Property or any part thereof, wholly or
partially (temporarily or permanently), by or on account of any actual or
threatened eminent domain proceeding or other taking of action by any Person
having the power of eminent domain, including without limitation an action by a
Governmental Authority to change the grade of, or widen the streets adjacent to,
the Property or alter the pedestrian or vehicular traffic flow to the Property
so as to result in a change in access to the Property, or by or on account of an
eviction by paramount title or any transfer made in lieu of any such proceeding
or action.

“Consolidated EBITDA” means, for any fiscal period, with respect to the Lessee
and the Consolidated Subsidiaries, Consolidated Net Income for such period plus,
to the extent deducted in computing such Consolidated Net Income, without
duplication, the sum of (a) income tax expense, (b) interest expense (including
the aggregate yield (expressed in dollars) obtained by the purchasers or
investors under any Securitization Transactions on their investments in accounts
receivable of the Lessee and the Subsidiaries during such period, determined in
accordance with generally accepted financial practice and the terms of such
Securitization Transactions), (c) depreciation and amortization expense, (d) any
non-cash extraordinary or non-cash non-recurring losses and (e) other non-cash
items (other than accruals) reducing Consolidated Net Income, minus, to the
extent added in computing such Consolidated Net Income, without duplication, the
sum of (i) interest income, (ii) any extraordinary or non-recurring gains and
(iii) other non-cash items increasing Consolidated Net Income, all as determined
on a consolidated basis in accordance with GAAP. In the event that there shall
have occurred any acquisition or disposition by the Lessee or a Subsidiary of a
business or business unit during any period for which Consolidated EBITDA is to
be determined, such determination shall be made on a pro forma basis (in
accordance with Regulation S-X under the Securities Act of 1933) as if such
acquisition or disposition and any related incurrence or repayment of
Indebtedness had occurred on the first day of such period.

“Consolidated Interest Expense” means, for any fiscal period, the aggregate of
all interest expense of the Lessee and the Consolidated Subsidiaries for such
period that, in accordance with GAAP, is or should be included in “interest
expense” reflected in the income statement for the Lessee and the Consolidated
Subsidiaries, less the amount of capital lease interest accrued to the Lessee or
any Consolidated Subsidiary for such period that is not reflected in
Consolidated EBITDA for such period, all as determined on a consolidated basis
in accordance with GAAP, plus, for any fiscal period, the aggregate yield
(expressed in dollars) obtained by the purchasers under any Securitization
Transactions on their investments in accounts receivable of the Lessee and the
Subsidiaries during such period, determined in

 

Appendix A - 7

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accordance with generally accepted financial practice and the terms of such
Securitization Transactions. In the event that there shall have occurred any
acquisition or disposition by the Lessee or a Subsidiary of a business or
business unit during any period for which Consolidated Interest Expense is to be
determined, such determination shall be made on a pro forma basis (in accordance
with Regulation S-X under the Securities Act of 1933) as if such acquisition or
disposition and any related incurrence or repayment of Indebtedness had occurred
on the first day of such period.

“Consolidated Net Income” means, for any fiscal period, net income of the Lessee
and the Consolidated Subsidiaries for such period, determined on a consolidated
basis in accordance with GAAP.

“Consolidated Subsidiary” means any Subsidiary that should be consolidated with
the Lessee for financial reporting purposes in accordance with GAAP.

“Consolidated Total Debt” means, at any date, all Indebtedness of the Lessee and
the Consolidated Subsidiaries at such date, determined on a consolidated basis
in accordance with GAAP, plus, without duplication, the aggregate outstanding
principal amount of all Securitization Transactions.

“Control” means the possession, directly or indirectly, of the power to direct
or cause the direction of the management or policies of a Person, whether
through the ability to exercise voting power, by contract or otherwise.
“Controlling” and “Controlled” have meanings correlative thereto.

“Controlled Group” shall mean all members of a controlled group of corporations
and all trades or businesses (whether or not incorporated) under common control
which, together with the Lessee, are treated as a single employer under
Section 414 of the Code.

“Convergys” shall mean Convergys Corporation, an Ohio corporation.

“Credit Documents” shall mean the Participation Agreement, the Credit Note Loan
Agreement, the Mortgage Note Loan Agreement, the Notes and the Security
Documents.

“Credit Lenders” shall mean the banks and lending institutions which are
currently party to the Participation Agreement and the Credit Note Loan
Agreement, in each case in such capacity, and shall include the other banks and
other lending institutions which may be from time to time party to the Credit
Note Loan Agreement.

“Credit Loan” shall mean each loan extended by the Credit Lenders to the
Borrower pursuant to the Credit Note Loan Agreement.

“Credit Loan Basic Rent” shall mean the scheduled interest due on the Credit
Notes on any Scheduled Interest Payment Date pursuant to the Credit Note Loan
Agreement.

“Credit Loan Property Cost” shall mean, with respect to the Property at any date
of determination, an amount equal to (a) the aggregate principal amount of all
Credit Loans made on or prior to such date minus (b) the aggregate amount of
prepayments or repayments as the case may be of the Credit Loans allocated to
reduce the Credit Loan Property Cost of the Property pursuant to Section 2.6(c)
of the Credit Note Loan Agreement.

“Credit Note” shall have the meaning given to it in Section 1 of the Credit Note
Loan Agreement.

“Credit Note Commitments” shall mean the obligation of the Credit Lenders to
purchase Credit Loans to the Borrower in an aggregate principal amount not to
exceed the aggregate of the amounts set

 

Appendix A - 8

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forth opposite each Credit Lender’s name on Schedule 2.1 to the Credit Note Loan
Agreement; provided, no Credit Lender shall be obligated to purchase Credit
Loans to the Borrower in excess of such Credit Lender’s share of the Credit Note
Commitments as set forth adjacent to such Credit Lender’s name on Schedule 2.1
to the Credit Note Loan Agreement.

“Credit Note Loan Agreement” shall mean the Amended and Restated Credit Note
Loan Agreement, dated as of the Closing Date, among the Borrower, the Agent and
the Credit Lenders, as specified therein.

“Credit Note Loan Agreement Default” shall mean any event or condition which,
with the lapse of time or the giving of notice, or both, would constitute a
Credit Note Loan Agreement Event of Default.

“Credit Note Loan Agreement Event of Default” shall have the meaning given to
such term in Section 11 of the Credit Note Loan Agreement.

“Credit Note Obligations” means the collective reference to all obligations, now
existing or hereafter arising, owing by the Borrower and/or the Credit Parties
and/or any of their affiliates to the Credit Lenders (or the Agent, on behalf of
the Credit Lenders) under or pursuant to the Operative Agreements whether direct
or indirect, absolute or contingent, due or to become due, now existing or
hereafter incurred, which may arise under, out of, or in connection with the
Participation Agreement, the Credit Note Loan Agreement, the Lease Agreement,
the Credit Notes, or any of the other Operative Agreements, whether on account
of principal, advanced amounts, interest, reimbursement obligations, fees,
indemnities, costs, expenses or otherwise (including, without limitation, all
reasonable fees and disbursements of counsel to the Agent or to the Credit
Lenders) that are required to be paid by the Borrower and/or the Lessee pursuant
to the terms of the Operative Agreements. Notwithstanding the foregoing, the
term “Credit Note Obligations” shall not include the Mortgage Obligations or any
obligation or amount included in the definition of the term “Rent” that is owed
by the Lessee to the Lessor for the benefit of, or on account of, any of the
Mortgage Obligations (including without limitation any portion of Basic Rent or
Supplemental Rent attributable to or calculated based on any amount of interest
or other amounts payable under the Mortgage Notes).

“Credit Parties” shall mean the Lessee and each Guarantor.

“Debt Rating” shall mean, as of any date of determination thereof and with
respect to any Person, the ratings most recently published by the Rating
Agencies relating to the Index Debt of such Person.

“Deed” shall mean a warranty deed or other instrument of conveyance regarding
the Land and/or Improvements in form and substance satisfactory to the Agent.

“Default” shall mean any event, act or condition which with notice or lapse of
time, or both, would constitute an Event of Default.

“Disclosed Matters” means the actions, suits and proceedings and the
environmental matters disclosed in Schedule 6.2(f).

“Dispute” shall mean any claim or controversy arising out of, or relating to,
the Operative Agreements between or among the parties thereto.

“Documents” shall have the meaning given to such term in Section 1 of the
Security Agreement.

“Dollars” and “$” shall mean dollars in lawful currency of the United States of
America.

 

Appendix A - 9

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“Election Date” shall have the meaning given to such term in Section 20.1 of the
Lease.

“Election Notice” shall have the meaning given to such term in Section 20.1 of
the Lease.

“Eligible Lessor” shall mean a Person not affiliated with the Lessee with a Debt
Rating from a Rating Agency of “A” or higher and with a total net worth of
$350,000,000 or more, or any Affiliate of such a Person if such Person otherwise
agrees in writing to indemnify the Lenders in a manner reasonably satisfactory
to the Lenders for any Claim arising as a result of (i) a Bankruptcy Event
respecting such Affiliate, (ii) such Affiliate’s breach of any covenant,
representation or warranty under any Operative Agreement, and (iii) such
Affiliate’s failure to perform any of its obligations under any Operative
Agreement (but such written agreement may exclude any such Claim if such Claim
arises, in whole or in part, from a Lease Event of Default).

“Employee Benefit Plan” or “Plan” shall mean an employee benefit plan (within
the meaning of Section 3(3) of ERISA, including without limitation any
Multiemployer Plan), or any “plan” as defined in Section 4975(e)(1) of the Code
and as interpreted by the Internal Revenue Service and the Department of Labor
in rules, regulations, releases or bulletins in effect on the Closing Date.

“Engagement Letter” shall have the meaning given to such term in Section 7.5 of
the Participation Agreement.

“Environmental Claims” shall mean any investigation, notice, violation, demand,
allegation, action, suit, injunction, judgment, order, consent decree, penalty,
fine, lien, proceeding, or claim (whether administrative, judicial, or private
in nature) relating to or affecting the Property arising (a) pursuant to, or in
connection with, an actual or alleged violation of, any Environmental Law,
(b) in connection with any Hazardous Substance, (c) from any abatement, removal,
remedial, corrective, or other response action in connection with a Hazardous
Substance, Environmental Law, or other order of a Tribunal or (d) from any
actual or alleged damage, injury, threat, or harm to health, safety, natural
resources, or the environment.

“Environmental Laws” means all laws, rules, regulations, codes, ordinances,
orders, decrees, judgments, injunctions, notices or binding agreements issued,
promulgated or entered into by any Governmental Authority, relating in any way
to the environment, preservation or reclamation of natural resources, the
management, release or threatened release of any Hazardous Material or to health
and safety matters.

“Environmental Liability” means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Lessee or any Subsidiary directly or
indirectly resulting from or based upon (a) violation of any Environmental Law,
(b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials,
(d) the release or threatened release of any Hazardous Materials into the
environment or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.

“Environmental Matters” shall have the meaning given to such term in Section 11
of the Participation Agreement.

“Environmental Violation” shall mean any activity, occurrence or condition that
violates or threatens (if the threat requires remediation under any
Environmental Law and is not remediated during any grace period allowed under
such Environmental Law) to violate or results in or threatens (if the threat
requires remediation under any Environmental Law and is not remediated during
any grace period allowed under such Environmental Law) to result in
noncompliance with any Environmental Law relating to or affecting the Property.

 

Appendix A - 10

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“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time.

“ERISA Affiliate” means any trade or business (whether or not incorporated)
that, together with the Lessee, is treated as a single employer under
Section 414(b) or (c) of the Code or, solely for purposes of Section 302 of
ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.

“ERISA Event” means (a) any “reportable event”, as defined in Section 4043 of
ERISA or the regulations issued thereunder with respect to a Plan (other than an
event for which the 30-day notice period is waived); (b) the existence with
respect to any Plan of an “accumulated funding deficiency” (as defined in
Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the
filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Plan; (d) the incurrence by the Lessee or any of its ERISA Affiliates of any
liability under Title IV of ERISA with respect to the termination of any Plan;
(e) the receipt by the Lessee or any ERISA Affiliate from the PBGC or a plan
administrator of any notice relating to an intention to terminate any Plan or
Plans or to appoint a trustee to administer any Plan; (f) the incurrence by the
Lessee or any of its ERISA Affiliates of any liability with respect to the
withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (g) the
receipt by the Lessee or any ERISA Affiliate of any notice, or the receipt by
any Multiemployer Plan from the Lessee or any ERISA Affiliate of any notice,
concerning the imposition of Withdrawal Liability or a determination that a
Multiemployer Plan is, or is expected to be, insolvent or in reorganization,
within the meaning of Title IV of ERISA.

“Eurocurrency Reserve Requirements” shall mean a fraction (expressed as a
decimal), the numerator of which is the number one and the denominator of which
is the number one minus the aggregate of the maximum reserve percentages
(including any marginal, special, emergency or supplemental reserves) expressed
as a decimal established by the Board to which the Agent is subject for
eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in
Regulation D of the Board). Such reserve percentages shall include those imposed
pursuant to such Regulation D. Eurodollar Loans and Eurodollar Lessor Advances
shall be deemed to constitute eurocurrency funding and to be subject to such
reserve requirements without benefit of or credit for proration, exemptions or
offsets that may be available from time to time to any Lender or the Lessor
under such Regulation D or any comparable regulation. The Eurocurrency Reserve
Requirements shall be adjusted automatically on and as of the effective date of
any change in any reserve percentage.

“Eurodollar Financings” shall mean principal amounts of the Lessor Advance or
principal amounts owing under the Credit Notes or the Mortgage Notes, bearing a
Lessor Yield or rate of interest, as applicable, based upon the Eurodollar Rate.

“Eurodollar Lessor Advance” shall mean principal amounts of the Lessor Advance
bearing a Lessor Yield based upon the Eurodollar Rate.

“Eurodollar Loans” shall mean Credit Loans or Mortgage Loans the rate of
interest applicable to which is based upon the Eurodollar Rate.

“Eurodollar Rate” shall mean, with respect to any Eurodollar Financing for any
Interest Period, an interest rate per annum (rounded upwards, if necessary, to
the next 1/16 of 1%) equal to (a) the Base Eurodollar Rate for such Interest
Period multiplied by (b) the Eurocurrency Reserve Requirements.

 

Appendix A - 11

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“Event of Default” shall mean a Lease Event of Default, a Credit Note Loan
Agreement Event of Default or a Mortgage Note Loan Agreement Event of Default.

“Event of Loss” shall mean any Casualty, Condemnation or Environmental Violation
that causes or results in the delivery of a Termination Notice by the Lessee in
accordance with Section 16.1 of the Lease.

“Excepted Payments” shall mean:

(a) all indemnity payments (including without limitation indemnity payments made
pursuant to Section 11 of the Participation Agreement), whether made by
adjustment to Basic Rent or otherwise, to which any Financing Party or any of
its Affiliates, agents, officers, directors or employees is entitled;

(b) any amounts (other than Basic Rent or Termination Value) payable under any
Operative Agreement to reimburse any Financing Party or any of its Affiliates
(including without limitation the reasonable expenses of any Financing Party
incurred in connection with any such payment) for performing or complying with
any of the obligations of the Lessee under and as permitted by any Operative
Agreement;

(c) any amount payable to the Lessor or any Primary Financing Party by an
transferee permitted under the Operative Agreements of the Lessor or such
Primary Financing Party as the purchase price of the Lessor’s interest in the
Borrower’s Interest (which amount shall not include any amounts necessary to pay
the principal and interest on the Notes or any other amount payable to the Agent
or the Primary Financing Parties) or such Primary Financing Party’s interest in
the transactions contemplated by the Operative Agreements (or a portion
thereof);

(d) any insurance proceeds (or payments with respect to risks self-insured or
policy deductibles) under liability policies other than such proceeds or
payments payable to any Financing Party;

(e) any property insurance proceeds that are paid under policies maintained by
the Lessor or any other Financing Party pursuant to or in accordance with the
terms of the Operative Agreements and that do not, because of “other insurance”
provisions in the applicable insurance policies or for any other reason, reduce
the proceeds of insurance maintained by or for the Lessee with respect to the
Property as required by the Lease;

(f) Transaction Expenses or other amounts, fees, disbursements or expenses paid
or payable to or for the benefit of the Lessor or any other Financing Party;

(g) any payments in respect of interest to the extent attributable to payments
referred to in clauses (a) through (f) above; and

(h) any rights of the Financing Parties to demand, collect, sue for or otherwise
receive and enforce payment of any of the foregoing amounts, provided that such
rights shall not include the right to terminate or exercise any other remedies
under the Lease.

“Excess Proceeds” shall mean the excess, if any, of the aggregate of all awards,
compensation or insurance proceeds payable in connection with a Casualty or
Condemnation over the Termination Value paid by the Lessee pursuant to the Lease
with respect to such Casualty or Condemnation.

 

Appendix A - 12

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“Excluded Taxes” shall have the meaning given to such term in Section 11.2(b) of
the Participation Agreement.

“Exculpated Persons” shall mean the Lessor (except with respect to the
representations and warranties and the other obligations of the Lessor pursuant
to the Operative Agreements solely with respect to the making of the Lessor
Advance), the Borrower, and their respective officers, directors, shareholders
and partners.

“Exempt Payments” shall have the meaning specified in Section 11.2(e) of the
Participation Agreement.

“Existing Credit Loans” shall mean the loans provided by the Existing Credit
Note Purchasers as evidenced by the Existing Credit Notes.

“Existing Credit Note” shall have the meaning given to such term in the
Assignment and Recharacterization Agreement.

“Existing Credit Note Purchasers” shall have the meaning given to such term in
the Assignment and Recharacterization Agreement.

“Existing Debt Provider” shall have the meaning given to such term in the
Assignment and Recharacterization Agreement.

“Existing Intercreditor Agreement” shall have the meaning provided for the term
“Intercreditor Agreement” in Appendix A to the Existing Participation Agreement.

“Existing Lease” shall have the meaning given to such term in Article IA of the
Lease.

“Existing Lessee” shall have the meaning given to such term in the Assignment
and Recharacterization Agreement.

“Existing Lessor” shall have the meaning given to such term in the Assignment
and Recharacterization Agreement.

“Existing Lessor Advance” shall have the meaning given to such term in the
Assignment and Recharacterization Agreement.

“Existing Loans” shall mean the Existing Credit Loans and the Existing Mortgage
Loans.

“Existing Mortgage Lenders” shall have the meaning given to such term in the
Assignment and Recharacterization Agreement.

“Existing Mortgage Loans” shall mean the loans provided by the Existing Mortgage
Lenders as evidenced by the Existing Mortgage Notes.

“Existing Mortgage Note” shall have the meaning given to such term in the
Assignment and Recharacterization Agreement.

“Existing Mortgage Note Loan Agreement” shall have the meaning given to such
term in Article 1A of the Mortgage Note Loan Agreement.

 

Appendix A - 13

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“Existing Notes” shall have the meaning given to such term in the Assignment and
Recharacterization Agreement.

“Existing Note Purchase Agreement” shall have the meaning given to such term in
Article 1A of the Credit Note Loan Agreement.

“Existing Operative Agreements” shall have the meaning given to such term in the
Assignment and Recharacterization Agreement.

“Existing Participation Agreement” shall have the meaning given to such term in
the Assignment and Recharacterization Agreement.

“Existing Security Agreement” shall have the meaning provided for the term
“Security Agreement” in Appendix A to the Existing Participation Agreement.

“Expiration Date” shall mean the last day of the Term.

“Fair Market Sales Value” shall mean, with respect to the Property, the amount,
which in any event, shall not be less than zero (0), that would be paid in cash
in an arms-length transaction between an informed and willing purchaser and an
informed and willing seller, neither of whom is under any compulsion to purchase
or sell, respectively, the Property. Fair Market Sales Value of the Property
shall be determined based on the assumption that, except for purposes of
Section 17 of the Lease, the Property is in the condition and state of repair
required under Section 10.1 of the Lease and the Lessee is in compliance with
the other requirements of the Operative Agreements.

“Federal Funds Effective Rate” shall have the meaning given to such term in the
definition of ABR.

“Fifty Percent FMV Event” shall have the meaning given to such term in
Section 8.2(e) of the Participation Agreement.

“Financial Officer” means the chief financial officer, principal accounting
officer, treasurer or controller of the Lessee.

“Financing” shall mean the collective amount of financing provided by the Lessor
in the form of the Lessor Advance, the proceeds of the Credit Loans from the
Credit Lenders and the proceeds of the Mortgage Loans from the Mortgage Lenders.

“Financing Parties” shall mean the Agent and the Primary Financing Parties.

“First Priority Liens” shall have the meaning given to such term in Section 3.1
of the Intercreditor Agreement.

“Fitch” shall mean Fitch, Inc.

“Fixtures” shall mean all fixtures relating to the Improvements, including
without limitation all components thereof, located in or on the Improvements,
together with all replacements, modifications, alterations and additions
thereto.

 

Appendix A - 14

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“Foreign Subsidiary” means any Subsidiary that is not incorporated or otherwise
organized under the laws of the United States or its territories or possessions.

“Form W-8BEN” shall have the meaning given to such term in Section 11.3(e) of
the Participation Agreement.

“Form W-8ECI” shall have the meaning given to such term in Section 11.3(e) of
the Participation Agreement.

“GAAP” shall mean generally accepted accounting principles, consistently
applied, set forth in the opinions and pronouncements of the accounting
principles board of the American Institute of Certified Public Accountants, and
statements and pronouncements of the Financial Accounting Standards Board or in
such other statements by such other entity as may be approved by a significant
segment of the accounting profession, that are applicable to the circumstances
as of the date of determination.

“Governmental Action” shall mean all permits, authorizations, registrations,
consents, approvals, waivers, exceptions, variances, orders, judgments, written
interpretations, decrees, licenses, exemptions, publications, filings, notices
to and declarations of or with, or required by, any Governmental Authority, or
required by any Legal Requirement, and shall include, without limitation, all
environmental and operating permits and licenses that are required for the full
use, occupancy, zoning and operating of the Property.

“Governmental Authority” means the government of the United States of America,
any other nation or any political subdivision thereof, whether state or local,
and any agency, authority, instrumentality, regulatory body, court, central bank
or other entity exercising executive, legislative, judicial, taxing, regulatory
or administrative powers or functions of or pertaining to government.

“Ground Lease” shall mean a ground lease (in form and substance satisfactory to
the Agent) respecting all or any portion of the Property (a) owned by any Credit
Party (or a parent corporation or any Subsidiary of any Credit Party) and leased
to the Lessor where such lease has at least a ninety-nine (99) year term and
payments set at no more than $1.00 per year, or (b) where such lease is subject
to such other terms and conditions as are satisfactory to the Agent, and,
notwithstanding the foregoing shall include but shall not be limited to that
certain Second Amended and Restated Ground Lease Agreement dated as of June 30,
2010 from Lessee to the Lessor of that certain land in Seminole County, Florida,
as described more particularly in the Exhibit A attached thereto.

“Guarantee” of or by any Person (the “guarantor”) means any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other obligation of any other Person
(the “primary obligor”) in any manner, whether directly or indirectly, and
including any obligation of the guarantor, direct or indirect, (a) to purchase
or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation or to purchase (or to advance or supply funds
for the purchase of) any security for the payment thereof, (b) to purchase or
lease property, securities or services for the purpose of assuring the owner of
such Indebtedness or other obligation of the payment thereof, (c) to maintain
working capital, equity capital or any other financial statement condition or
liquidity of the primary obligor so as to enable the primary obligor to pay such
Indebtedness or other obligation or (d) as an account party in respect of any
letter of credit or letter of guaranty issued to support such Indebtedness or
obligation; provided, that the term Guarantee shall not include endorsements for
collection or deposit in the ordinary course of business. The term “Guarantee”
when used as a verb shall have a corresponding meaning.

 

Appendix A - 15

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“Guarantee Agreement” means the various provisions of the Participation
Agreement constituting the guarantee pursuant to Section 6B of the Participation
Agreement, representations, warranties, covenants and other provisions of the
Participation Agreement, in each case, constituting undertakings of the
Guarantors and evidenced by the execution and delivery of either (a) the
Participation Agreement by each Material Subsidiary (other than a Foreign
Subsidiary) existing as of the Closing Date or (b) a joinder agreement (in form
and substance satisfactory to the Agent) joining each applicable Material
Subsidiary (other than a Foreign Subsidiary) existing at such time which has not
previously executed the Participation Agreement or any such joinder agreement

“Guarantee Requirement” means, at any time, that the Guarantee Agreement shall
have been executed by each Material Subsidiary (other than a Foreign Subsidiary)
existing at such time, shall have been delivered to the Agent and shall be in
full force and effect.

“Guarantor” means any Subsidiary that shall be a party to the Guarantee
Agreement.

“Hazardous Materials” means all explosive or radioactive substances or wastes
and all hazardous or toxic substances, wastes or other pollutants, including
petroleum or petroleum distillates, asbestos or asbestos containing materials,
polychlorinated biphenyls, radon gas, infectious or medical wastes and all other
substances or wastes of any nature regulated pursuant to any Environmental Law.

“Hazardous Substance” shall mean any of the following: (a) any petroleum or
petroleum product, explosives, radioactive materials, asbestos, formaldehyde,
polychlorinated biphenyls, lead and radon gas; (b) any substance, material,
product, derivative, compound or mixture, mineral, chemical, waste, gas, medical
waste, or pollutant, in each case whether naturally occurring, man-made or the
by-product of any process, that is toxic, harmful or hazardous to the
environment or human health or safety as determined in accordance with any
Environmental Law; or (c) any substance, material, product, derivative, compound
or mixture, mineral, chemical, waste, gas, medical waste or pollutant that would
support the assertion of any claim under any Environmental Law, whether or not
defined as hazardous as such under any Environmental Law.

“Hedging Agreement” means any interest rate protection agreement, foreign
currency exchange agreement, commodity price protection agreement or other
interest or currency exchange rate or commodity price hedging arrangement. The
“principal amount” of the obligations of the Lessee or any Subsidiary in respect
of any Hedging Agreement at any time shall be the maximum aggregate amount
(giving effect to any netting agreements provided for in such Hedging
Agreements) that the Lessee or such Subsidiary would be required to pay if such
Hedging Agreement were terminated at such time.

“HRM Sale” means the sale, in one or more transactions, of the Lessee’s “HRM”
line of business (i.e. the business of providing human resource outsourcing
solutions, including benefits administration, compensation, human resource
administration, learning, payroll administration, performance management,
recruiting and sourcing services).

“Impositions” shall mean any and all liabilities, losses, expenses, costs,
charges and Liens of any kind whatsoever for fees, taxes, levies, imposts,
duties, charges, assessments or withholdings of any nature whatsoever including
but not limited to (i) real and personal property taxes, including without
limitation personal property taxes on any property covered by the Lease that is
classified by Governmental Authorities as personal property, and real estate or
ad valorem taxes in the nature of property taxes; (ii) sales taxes, use taxes
and other similar taxes (including rent taxes and intangibles taxes);
(iii) excise taxes; (iv) real estate transfer taxes, conveyance taxes, stamp
taxes and documentary recording taxes and fees; (v) taxes that are or are in the
nature of franchise, income, value added, privilege and doing business taxes,
license and registration fees; (vi) assessments on the Property, including

 

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without limitation all assessments for public Improvements or benefits, whether
or not such improvements are commenced or completed within the Term; and
(vii) taxes, Liens, assessments or charges asserted, imposed or assessed by the
PBGC or any governmental authority succeeding to or performing functions similar
to, the PBGC; and all interest, additions to tax and penalties, which at any
time prior to, during or with respect to the Term or in respect of any period
for which the Lessee shall be obligated to pay Supplemental Rent, may be levied,
assessed or imposed by any Governmental Authority upon or with respect to
(a) any Indemnified Person, the Property or any part thereof or interest
therein; (b) the leasing, financing, refinancing, purchase, acceptance,
rejection, demolition, construction, substitution, subleasing, assignment,
control, condition, occupancy, servicing, maintenance, repair, ownership,
possession, activity conducted on or in, delivery, insuring, use, rental, lease,
operation, improvement, sale, transfer of title, return or other disposition of
the Property or any part thereof or interest therein; (c) the Notes, the Lessor
Advance, other indebtedness with respect to the Property, or any part thereof or
interest therein; (d) the rentals, receipts or earnings arising from the
Property or any part thereof or interest therein; (e) the Operative Agreements,
the execution, performance or enforcement thereof, or any payment made or
accrued pursuant thereto; (f) the income or other proceeds received with respect
to the Property or any part thereof or interest therein upon the sale or
disposition thereof; (g) any contract relating to the construction, acquisition
or delivery of the Improvements or any part thereof or interest therein; (h) the
issuance of the Notes; (i) the Borrower or the Borrower’s Interest; or
(j) otherwise in connection with the transactions contemplated by the Operative
Agreements including in connection with the transfers, assignments, conveyances
and other transactions contemplated by the Assignment and Recharacterization
Agreement.

“Improvements” shall mean, with respect to the construction, renovations and/or
Modifications on any Land, all buildings, structures, Fixtures, and other
improvements of every kind existing at any time and from time to time on or
under the Land purchased or otherwise acquired using the proceeds of the Lessor
Advance, the Credit Loans and the Mortgage Loans or which is subject to a Ground
Lease, together with any and all appurtenances to such buildings, structures or
improvements, including without limitation sidewalks, utility pipes, conduits
and lines, parking areas and roadways, and including without limitation all
Modifications and other additions to or changes in the Improvements at any time,
including without limitation (a) any Improvements existing as of the Closing
Date as such Improvements may be referenced on the Requisition and (b) any
Improvements made subsequent to such Closing Date.

“Indebtedness” of any Person means, without duplication, (a) all obligations of
such Person for borrowed money, (b) all obligations of such Person evidenced by
bonds, debentures, notes or similar instruments, (c) all obligations of such
Person upon which interest charges are customarily paid, (d) all obligations of
such Person under conditional sale or other title retention agreements relating
to property acquired by such Person, (e) all obligations of such Person in
respect of the deferred purchase price of property or services (excluding
current accounts payable incurred in the ordinary course of business), (f) all
Indebtedness of others secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by) any Lien on
property owned or acquired by such Person, whether or not the Indebtedness
secured thereby has been assumed, (g) all Guarantees by such Person of
Indebtedness of others, (h) all Capital Lease Obligations of such Person,
(i) all obligations, contingent or otherwise, of such Person as an account party
in respect of letters of credit and letters of guaranty, (j) all obligations,
contingent or otherwise, of such Person in respect of bankers’ acceptances and
(k) all Securitization Transactions of such Person. The Indebtedness of any
Person shall include the Indebtedness of any other entity (including any
partnership in which such Person is a general partner) to the extent such Person
is liable therefor as a result of such Person’s ownership interest in or other
relationship with such entity, except to the extent the terms of such
Indebtedness provide that such Person is not liable therefor.

 

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“Indemnified Person” shall mean the Lessor, the Agent, the other Primary
Financing Parties and their respective successors, assigns, directors, trustees,
shareholders, partners, officers, employees, agents and Affiliates.

“Indemnity Provider” shall mean the Lessee.

“Index Debt” means senior, unsecured, long-term indebtedness for borrowed money
of the Lessee that is not guaranteed by any other Person or subject to any other
credit enhancement; provided, however, only for so long as the Lessee Credit
Agreement is unsecured, this definition of “Index Debt” shall be deemed to refer
to “Long-Term Issuer Default Rating” for Fitch, “Corporate Family Rating” for
Moody’s and “Corporate Credit Rating” for S&P.

“Information Memorandum” means the Confidential Information Memorandum dated
May 13, 2010 relating to the Lessee and the Transactions.

“Instruments” shall have the meaning given to such term in Section 1 of the
Security Agreement.

“Insurance Requirements” shall mean all terms and conditions of any insurance
policy either required by the Lease to be maintained by the Lessee, and all
requirements of the issuer of any such policy and, regarding self insurance, any
other requirements of the Lessee.

“Intercompany Indebtedness” means any Indebtedness of any Subsidiary which is
owing to the Lessee or any other Subsidiary.

“Intercreditor Agreement” shall mean that certain Amended and Restated
Intercreditor and Lien Subordination Agreement dated as of the Closing Date
among the Lessor, the Credit Lenders, the Mortgage Lenders and the Agent.

“Interest Period” shall mean as to any Eurodollar Financing (i) with respect to
the initial Interest Period and any Interest Period immediately following a
conversion from an ABR Financing to a Eurodollar Financing, the period beginning
on the date of the first Eurodollar Financing and ending one (1) month
thereafter, and (ii) thereafter, each period commencing on the last day of the
next preceding Interest Period applicable to such Eurodollar Financing and
ending one (1) month thereafter; provided, however, that all of the foregoing
provisions relating to Interest Periods are subject to the following: (A) if any
Interest Period would end on a day which is not a Business Day, such Interest
Period shall be extended to the next succeeding Business Day (except that where
the next succeeding Business Day falls in the next succeeding calendar month,
then on the next preceding Business Day), (B) no Interest Period shall extend
beyond the Expiration Date, as the case may be, (C) where an Interest Period
begins on a day for which there is no numerically corresponding day in the
calendar month in which the Interest Period is to end, such Interest Period
shall end on the last Business Day of such calendar month, (D) there shall not
be more than four (4) Interest Periods outstanding at any one (1) time.

“Investment Company Act” shall mean the Investment Company Act of 1940, as
amended, together with the rules and regulations promulgated thereunder.

“Land” shall mean a parcel of real property described on (a) the Requisition
submitted by the Lessee in connection with the Closing Date relating to such
parcel and (b) the schedules to the Lease Supplement executed and delivered in
accordance with the requirements of Section 2.4 of the Lease.

“Law” shall mean any statute, law, ordinance, regulation, rule, directive,
order, writ, injunction or decree of any Tribunal.

 

Appendix A - 18

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“Lease” or “Lease Agreement” shall mean the Second Amended and Restated Lease
Agreement dated as of the Closing Date, between the Lessor and the Lessee,
together with the Lease Supplement thereto.

“Lease Default” shall mean any event or condition which, with the lapse of time
or the giving of notice, or both, would constitute a Lease Event of Default.

“Lease Event of Default” shall have the meaning specified in Section 17.1 of the
Lease.

“Lease Supplement” shall mean the Second Amended and Restated Lease Supplement
No. 1 dated as of the Closing Date substantially in the form of Exhibit A to the
Lease, together with all attachments and schedules thereto.

“Legal Requirements” shall mean all foreign, federal, state, county, municipal
and other governmental statutes, laws, rules, orders, regulations, ordinances,
judgments, decrees and injunctions affecting the Lessor, the Lessee, the Agent,
any other Primary Financing Party or the Property, Land or Improvements, or the
taxation, demolition, construction, use or alteration of the Property, Land or
Improvements, whether now or hereafter enacted and in force, including without
limitation any that require repairs, modifications or alterations in or to the
Property or in any way limit the use and enjoyment thereof (including without
limitation all building, zoning and fire codes and the Americans with
Disabilities Act of 1990, 42 U.S.C. § 12101 et. seq., and any other similar
federal, state or local laws or ordinances and the regulations promulgated
thereunder) and any that may relate to environmental requirements (including
without limitation all Environmental Laws), and all permits, certificates of
occupancy, licenses, authorizations and regulations relating thereto, and all
covenants, agreements, restrictions and encumbrances contained in any
instruments which are either of record or known to the Lessee affecting the
Property or the Appurtenant Rights.

“Lenders” shall mean, collectively, the Credit Lenders and the Mortgage Lenders.

“Lessee” shall have the meaning set forth in the Lease.

“Lessee Credit Agreement” shall mean that certain $400,000,000 Five-Year
Competitive Advance and Revolving Credit Facility Agreement dated as of
October 20, 2006, by and among Convergys Corporation, the Lender Parties
thereto, JPMorgan Chase Bank, N.A., as Administrative Agent thereunder, Citicorp
USA, Inc., as Syndication Agent thereunder, PNC Bank, National Association, and
Deutsche Bank AG, New York Branch, as Co-Documentation Agents thereunder, and
J.P. Morgan Securities Inc. and CitiGroup Global Markets Inc., as Joint Lead
Arrangers and Joint Bookrunners thereunder, together with all amendments,
modifications, extensions, supplements, restatements and replacements thereof.

“Lessee Credit Agreement Event of Default” shall mean an Event of Default as
defined in Article VII of the Lessee Credit Agreement.

“Lessee Credit Agreement Loan Documents” means the Lessee Credit Agreement and
any promissory note issued thereunder and the Guarantee Agreement (as such term
is defined in the Lessee Credit Agreement).

“Lessor” shall mean Wachovia Development Corporation, a North Carolina
corporation, in its capacity as “lessor” under the Lease or as a Primary
Financing Party, as the context may require, and any successor, replacement
and/or additional lessor or lessor expressly permitted under the Operative
Agreements.

 

Appendix A - 19

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“Lessor Advance” shall mean the advance of funds made or deemed made by the
Lessor pursuant to the terms of the Participation Agreement.

“Lessor Basic Rent” shall mean the scheduled Lessor Yield due on the Lessor
Advance on any Scheduled Interest Payment Date.

“Lessor Commitment” shall mean the obligation of the Lessor to purchase the
Lessor Advance in an amount not to exceed $3,900,000.

“Lessor Confirmation Letter” shall mean the confirmation letter issued by the
Lessor from time to time to the Lessee pursuant to Section 8.2(f) of the
Participation Agreement, in a form substantially similar to the form of
confirmation letter provided to the Lessee on or prior to the Closing Date.

“Lessor Financing Statements” shall mean UCC financing statements and fixture
filings appropriately completed for filing in the applicable jurisdictions in
order to protect the Lessor’s interest under the Lease to the extent the Lease
is a security agreement or a mortgage.

“Lessor Lien” shall mean any Lien, true lease or sublease or disposition of
title arising as a result of (a) any claim against the Lessor not resulting from
the transactions contemplated by the Operative Agreements, (b) any act or
omission of the Lessor which is not required by the Operative Agreements or is
in violation of any of the terms of the Operative Agreements, (c) any claim
against the Lessor with respect to Taxes or Transaction Expenses against which
the Lessee is not required to indemnify the Lessor pursuant to Section 11 of the
Participation Agreement or (d) any claim against the Lessor arising out of any
transfer by the Lessor of all or any portion of the interest of the Lessor in
the Property, the Borrower’s Interest or the Operative Agreements other than the
transfer of title to or possession of the Property by the Lessor pursuant to and
in accordance with the Lease, the Credit Note Loan Agreement, the Mortgage Note
Loan Agreement, the Security Agreement or the Participation Agreement or
pursuant to the exercise of the remedies set forth in Article XVII of the Lease.

“Lessor Notice” shall have the meaning given to such term in Section 8.2(e) of
the Participation Agreement.

“Lessor Overdue Rate” shall mean the lesser of (a) the Lessor Yield plus two
percent (2%) and (b) the highest rate permitted by applicable Law.

“Lessor Property Cost” shall mean, with respect to the Property at any date of
determination, an amount equal to (a) the aggregate principal amount of the
Lessor Advance made on or prior to such date minus (b) the aggregate amount of
prepayments or repayments as the case may be of the Lessor Advance allocated to
reduce the Lessor Property Cost of the Property pursuant to Section 5B.4(c) of
the Participation Agreement.

“Lessor Yield” shall mean with respect to the Lessor Advance from time to time
either the Eurodollar Rate plus the Applicable Percentage or the ABR plus the
Applicable Percentage, as elected by the Lessee; provided, however, (a) in the
event the Agent is unable to determine the Eurodollar Rate as provided in
Section 5B.6(c) of the Participation Agreement, the outstanding Lessor Advance
shall bear a yield at the ABR plus the Applicable Percentage applicable from
time to time from and after the dates and during the periods specified in
Section 5B.6(c) of the Participation Agreement, and (b) upon the delivery by
Lessor of the notice described in Section 11.3(e) of the Participation
Agreement, the Lessor Advance shall bear a yield at the ABR plus the Applicable
Percentage applicable from time to time after the dates and during the periods
specified in Section 11.3(e) of the Participation Agreement.

 

Appendix A - 20

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“Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien,
pledge, hypothecation, encumbrance, charge or security interest in, on or of
such asset, (b) the interest of a vendor or a lessor under any conditional sale
agreement, capital lease or title retention agreement (or any financing lease
having substantially the same economic effect as any of the foregoing) relating
to such asset and (c) in the case of securities, any purchase option, call or
similar right of a third party with respect to such securities.

“Limited Recourse Amount” shall mean with respect to the Property, an amount
equal to the Termination Value with respect to the Property on the Expiration
Date, less the Maximum Residual Guarantee Amount as of such date with respect to
the Property.

“Limited Recourse Event of Default” shall have the meaning given to such term in
Section 17.11 of the Lease.

“Loan Agreements” shall mean, collectively, the Credit Note Loan Agreement and
the Mortgage Note Loan Agreement.

“Loans” shall mean the Credit Loans and the Mortgage Loans.

“Majority Credit Lenders” shall mean at any time, Credit Lenders whose Credit
Loans outstanding represent at least fifty-one percent (51%) of the aggregate
Credit Loans outstanding.

“Majority Mortgage Lenders” shall mean at any time, Mortgage Lenders whose
Mortgage Loans outstanding represent at lease fifty-one percent (51%) of the
aggregate Mortgage Loans outstanding; provided, at any time when there are two
or more unaffiliated Mortgage Lenders, the Majority Mortgage Lenders must
include at least two unaffiliated Mortgage Lenders.

“Majority Secured Parties” shall mean at any time, Primary Financing Parties
whose Financings outstanding represent at least fifty-one percent (51%) of
(a) the aggregate Financings outstanding or (b) to the extent there are no
Financings outstanding, the aggregate of the Primary Financing Party
Commitments; provided, at any time when there are two or more unaffiliated
Secured Parties, the Majority Secured Parties must include at least two
unaffiliated Secured Parties.

“Marketing Notice” shall have the meaning given to such term in Section 3.2(c)
of the Intercreditor Agreement.

“Marketing Period” shall mean, if the Lessee has given a Sale Notice in
accordance with Section 20.1 of the Lease, the period commencing on the date
such Sale Notice is given and ending on the Expiration Date.

“Marketing Price” shall have the meaning given to such term in Section 3.2(c) of
the Intercreditor Agreement.

“Material Adverse Effect” shall mean a material adverse effect on (a) the
business, condition (financial or otherwise), assets, prospects or operations of
the Lessee and the Subsidiaries taken as a whole, (b) the ability of Lessee or
any other Credit Party to perform its respective obligations under any Operative
Agreement to which it is a party, (c) the validity or enforceability of any
Operative Agreement or the rights and remedies of the Agent, the Lessor or the
other Primary Financing Parties thereunder, (d)

 

Appendix A - 21

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the validity, priority or enforceability of any Lien on the Property or any
other Collateral created by any of the Operative Agreements, or (e) the fair
market value, utility or useful life of the Property or the use, or ability of
the Lessee to use, the Property for the purpose for which it was intended.

“Material Indebtedness” means Indebtedness (other than the Revolver Loans), or
obligations in respect of one or more Hedging Agreements, of any one or more of
the Lessee and its Subsidiaries in an aggregate principal amount exceeding
$25,000,000.

“Material Securitization Transaction” shall have the meaning given to such term
in Section 17.1(r) of the Lease.

“Material Subsidiary” means (a) any Subsidiary that directly or indirectly owns
or Controls any Material Subsidiary (unless the only Material Subsidiary
directly or indirectly owned or controlled by such Subsidiary is CMG Utah Inc.)
and (b) CMG Utah Inc. and any other Subsidiary (i) the revenues of which for the
most recent period of four fiscal quarters of the Lessee for which financial
statements have been delivered pursuant to Section 8.3A.1 were greater than 1%
of the Lessee’s consolidated revenues for such period and (ii) the assets of
which as of the end of such period were greater than 1% of Lessee’s consolidated
assets as of such date; provided that if at any time (x) the aggregate amount of
the revenues of all Subsidiaries that are not Material Subsidiaries exceeds 5%
of the Lessee’s consolidated revenues for the most recent period of four fiscal
quarters of the Lessee for which financial statements have been delivered
pursuant to Section 8.3A.1 or (y) the aggregate amount of the assets of all
Subsidiaries that are not Material Subsidiaries exceeds 5% of the Lessee’s
consolidated assets as of the end of such period, the Lessee (or, in the event
the Lessee has failed to do so within 10 Business Days, the Agent) shall
designate sufficient Subsidiaries as “Material Subsidiaries” to eliminate such
excess, and such designated Subsidiaries shall for all purposes of this
Agreement constitute Material Subsidiaries. For purposes of making the
determinations required by this definition, revenues and assets of Foreign
Subsidiaries shall be converted into dollars at the rates used in preparing the
consolidated balance sheet of the Lessee included in the applicable financial
statements. Notwithstanding the foregoing, a Subsidiary formed solely for the
purpose of carrying out one or more Securitization Transactions and owning no
assets and conducting no business other than those incidental to such
Securitization Transactions shall not constitute a Material Subsidiary.

“Maturity Date” shall mean June 30, 2015 or such earlier date on which the Lease
terminates.

“Maximum Residual Guarantee Amount” shall mean an amount equal to $47,000,00.00.

“Modifications” shall have the meaning specified in Section 11.1(a) of the
Lease.

“Moody’s” shall mean Moody’s Investors Service, Inc.

“Mortgage Instruments” shall mean (i) the Amended and Restated Open-End Fee and
Leasehold Mortgage, Assignment of Leases, Interests and Security Documents,
Security Agreement and Financing Statement dated as of the Closing Date;
(ii) the Second Amended and Restated Open-End Mortgage, Assignment of Leases,
Rents and Profits and Second Amended and Restated Memorandum of Second Amended
and Restated Lease and Second Amended and Restated Lease Supplement No. 1 and
Option; and (iii) each deed of trust, mortgage and any other instrument executed
by the Borrower and the Lessee in favor of the Agent (for the benefit of any
Primary Financing Party) and evidencing a Lien on the Property, in form and
substance reasonably acceptable to the Agent.

“Mortgage Lenders” shall mean the banks and lending institutions which are
currently party to the Participation Agreement and the Mortgage Note Loan
Agreement, in each case in such capacity, and shall include the other banks and
other lending institutions which may be from time to time party to the Mortgage
Note Loan Agreement.

 

Appendix A - 22

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“Mortgage Loan” shall mean each loan extended by the Mortgage Lenders to the
Borrower pursuant to the Mortgage Note Loan Agreement.

“Mortgage Loan Basic Rent” shall mean the scheduled interest due on the Mortgage
Loans on any Scheduled Interest Payment Date pursuant to the Mortgage Note Loan
Agreement.

“Mortgage Loan Property Cost” shall mean, with respect to the Property at any
date of determination, an amount equal to (a) the aggregate principal amount of
all Mortgage Loans made on or prior to such date minus (b) the aggregate amount
of prepayments or repayments as the case may be of the Mortgage Loans allocated
to reduce the Mortgage Loan Property Cost of the Property pursuant to
Section 2.6(c) of the Mortgage Note Loan Agreement.

“Mortgage Note” shall have the meaning given to it in Section 2.2 of the
Mortgage Note Loan Agreement.

“Mortgage Note Commitments” shall mean the obligation of the Mortgage Lenders to
purchase Mortgage Loans to the Borrower in an aggregate principal amount not to
exceed the aggregate of the amounts set forth opposite each Mortgage Lender’s
name on Schedule 2.1 to the Mortgage Note Loan Agreement; provided, no Mortgage
Lender shall be obligated to purchase Mortgage Loans to the Borrower in excess
of such Mortgage Lender’s share of the Mortgage Note Commitments as set forth
adjacent to such Mortgage Lender’s name on Schedule 2.1 to the Mortgage Note
Loan Agreement.

“Mortgage Note Loan Agreement” shall mean the Amended and Restated Mortgage Note
Loan Agreement, dated as of the Closing Date, among the Borrower, the Agent and
the Mortgage Lenders, as specified therein.

“Mortgage Note Loan Agreement Default” shall mean any event or condition which,
with the lapse of time or the giving of notice, or both, would constitute a
Mortgage Note Loan Agreement Event of Default.

“Mortgage Note Loan Agreement Event of Default” shall mean any event or
condition defined as an “Event of Default” in Section 6 of the Mortgage Note
Loan Agreement.

“Mortgage Obligations” means the collective reference to (i) all obligations,
now existing or hereafter arising, owing by the Lessee and/or any of its
affiliates to the Lessor (or the Agent, on behalf of the Lessor) under or
pursuant to the Operative Agreements whether direct or indirect, absolute or
contingent, due or to become due, now existing or hereafter incurred, which may
arise under, out of, or in connection with the Participation Agreement, the
Lease Agreement, or any of the other Operative Agreements, whether on account of
principal, advanced amounts, interest, reimbursement obligations, fees,
indemnities, costs, expenses or otherwise (including, without limitation, all
reasonable fees and disbursements of counsel to the Agent or to the Lessor) that
are required to be paid by the Lessee pursuant to the terms of the Operative
Agreements and (ii) all obligations, now existing or hereafter arising, owing by
the Borrower and/or the Lessee and/or any of their affiliates to the Mortgage
Lenders (or the Agent, on behalf of the Mortgage Lenders) under or pursuant to
the Operative Agreements whether direct or indirect, absolute or contingent, due
or to become due, now existing or hereafter incurred, which may arise under, out
of, or in connection with the Participation Agreement, the Mortgage Note Loan
Agreement, the Lease Agreement, the Mortgage Notes, or any of the other
Operative Agreements, whether on account of principal, advanced amounts,
interest, reimbursement obligations, fees,

 

Appendix A - 23

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indemnities, costs, expenses or otherwise (including, without limitation, all
reasonable fees and disbursements of counsel to the Agent or to the Mortgage
Lenders) that are required to be paid by the Borrower and/or the Lessee pursuant
to the terms of the Operative Agreements. Notwithstanding the foregoing, the
term “Mortgage Obligations” shall not include the Credit Note Obligations or any
obligation or amount included in the definition of the term “Rent” that is owed
by the Lessee to the Lessor for the benefit of, or on account of, any of the
Credit Note Obligations (including without limitation any portion of Basic Rent
or Supplemental Rent attributable to or calculated based on any amount of
interest or other amounts payable under the Credit Notes).

“Multiemployer Plan” means a multiemployer plan as defined in Section 4001(a)(3)
of ERISA.

“Multiple Employer Plan” shall mean a plan to which the Lessee or any ERISA
Affiliate and at least one (1) other employer other than an ERISA Affiliate is
making or accruing an obligation to make, or has made or accrued an obligation
to make, contributions.

“Net Proceeds” means, with respect to the HRM Sale, (a) the cash proceeds
received in respect of such sale, including any cash received in respect of any
noncash proceeds, but only as and when received, net of (b) all fees and
out-of-pocket expenses paid in connection with the HRM Sale by the Lessee and
the Subsidiaries to Persons that are not Affiliates of the Lessee.

“Notes” shall mean the Credit Notes and the Mortgage Notes.

“Obligations” shall mean the collective reference to all obligations (including
without limitation all payment and performance obligations), now existing or
hereafter arising, owing by the Borrower and/or the Lessee and/or any of their
affiliates to the Secured Parties under or pursuant to the Operative Agreements
whether direct or indirect, absolute or contingent, due or to become due, now
existing or hereafter incurred, which may arise under, out of, or in connection
with the Participation Agreement, the Lease Agreement, the Credit Note Loan
Agreement, the Mortgage Note Loan Agreement, the Notes or any of the other
Operative Agreements, whether on account of principal, advanced amounts,
interest, reimbursement obligations, fees, indemnities, costs, expenses,
termination payments or otherwise (including without limitation all reasonable
fees and disbursements of counsel to any of the Secured Parties) that are
required to be paid by the Borrower and/or the Lessee pursuant to the terms of
the Operative Agreements, and including without limitation the Credit Note
Obligations and the Mortgage Obligations.

“OFAC” has the meaning set forth in Section 6.2(n).

“Officer’s Certificate” with respect to any person shall mean a certificate
executed on behalf of such person by a Responsible Officer who has made or
caused to be made such examination or investigation as is necessary to enable
such Responsible Officer to express an informed opinion with respect to the
subject matter of such Officer’s Certificate.

“Operative Agreements” shall mean the following: the Participation Agreement,
the Credit Note Loan Agreement, the Mortgage Note Loan Agreement, the Notes, the
Lease, each Lease Supplement, the Ground Lease, the Security Agreement, the
Assignment of Lease, the Intercreditor Agreement, the Mortgage Instruments, the
other Security Documents, the Deed, the Assignment and Recharacterization
Agreement and any and all other agreements, documents and instruments executed
in connection with any of the foregoing.

“Original Executed Counterpart” shall have the meaning given to such term in
Section 5 of Exhibit A to the Lease.

 

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“Overdue Rate” shall mean (a) with respect to the Credit Loan Basic Rent,
interest payable under the Credit Note Loan Agreement or any Credit Note, and
any other amount owed to any Credit Lender under or with respect to the Credit
Note Loan Agreement, the Credit Notes and any other amount owing to any Credit
Lender under the Security Documents or the other Operative Agreements, the rate
specified in Section 2.8(b) of the Credit Note Loan Agreement, (b) with respect
to the Mortgage Loan Basic Rent, interest payable under the Mortgage Note Loan
Agreement or any Mortgage Note, and any other amount owed to any Mortgage Lender
under or with respect to the Mortgage Note Loan Agreement, the Mortgage Notes
and any other amount owing to any Mortgage Lender under the Security Documents
or the other Operative Agreements, the rate specified in Section 2.8(b) of the
Mortgage Note Loan Agreement, and (c) with respect to the Lessor Basic Rent, the
Lessor Yield and any other amount owing to the Lessor under the Security
Documents or the other Operative Agreements, the Lessor Overdue Rate, and
(d) with respect to any other amount, the greater of the rate specified in
Section 2.8(b) of the Credit Note Loan Agreement or the rate specified in
Section 2.8(b) of the Mortgage Note Loan Agreement.

“Participant” shall have the meaning given to such term, as applicable, in
Section 9.7 of the Credit Note Loan Agreement or the Section 9.7 of the Mortgage
Note Loan Agreement.

“Participation Agreement” shall mean the Amended and Restated Participation
Agreement dated as of the Closing Date, among the Lessee, the Guarantors, the
Lessor, the Credit Lenders, the Mortgage Lenders, and the Agent.

“Payment Date” shall mean any Scheduled Interest Payment Date and any date on
which interest or Lessor Yield in connection with a prepayment of principal on
the Notes or the Lessor Advance is due under the Credit Note Loan Agreement, the
Mortgage Note Loan Agreement or the Notes or any other Operative Agreement.

“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in
ERISA and any successor entity performing similar functions.

“Pension Plan” shall mean a “pension plan”, as such term is defined in section
3(2) of ERISA, which is subject to title IV of ERISA (other than a Multiemployer
Plan), and to which the Lessee or any ERISA Affiliate may have any liability,
including without limitation any liability by reason of having been a
substantial employer within the meaning of section 4063 of ERISA at any time
during the preceding five (5) years, or by reason of being deemed to be a
contributing sponsor under section 4069 of ERISA.

“Permitted Encumbrances” means:

(a) Liens imposed by law for taxes that are not yet due or are being contested
in compliance with Section 8.3A.4;

(b) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s and other
like Liens imposed by law, arising in the ordinary course of business and
securing obligations that are not overdue by more than 30 days or are being
contested in compliance with Section 8.3A.4;

(c) pledges and deposits made in the ordinary course of business in compliance
with workers’ compensation, unemployment insurance and other social security
laws or regulations;

 

Appendix A - 25

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(d) deposits to secure the performance of bids, trade contracts, leases,
statutory obligations, surety and appeal bonds, performance bonds and other
obligations of a like nature, in each case in the ordinary course of business;

(e) judgment liens in respect of judgments that do not constitute an Event of
Default under Section 17.1(m) of the Lease; and

(f) easements, zoning restrictions, rights-of-way and similar encumbrances on
real property imposed by law or arising in the ordinary course of business that
do not secure any monetary obligations and do not materially detract from the
value of the affected property or interfere with the ordinary conduct of
business of the Lessee or any Subsidiary;

provided that the term “Permitted Encumbrances” shall not include any Lien
securing Indebtedness.

“Permitted Facility” shall mean each parcel of real property (together with
improvements existing or to be built thereon) selected by the Lessee and
acceptable to the Agent, in its sole discretion.

“Permitted Liens” shall mean, with respect to the Property:

(a) the respective rights and interests of the parties to the Operative
Agreements as provided in the Operative Agreements;

(b) the rights of any sublessee or assignee under a sublease or an assignment
expressly permitted by the terms of the Lease for no longer than the duration of
the Lease;

(c) Liens for Taxes that either are not yet due or are being contested in
accordance with the provisions of Section 13.1 of the Lease;

(d) Liens arising by operation of law, materialmen’s, mechanics’, workmen’s,
repairmen’s, employees’, carriers’, warehousemen’s and other like Liens relating
to the construction of the Improvements or in connection with any Modifications
or arising in the ordinary course of business for amounts that either are not
more than thirty (30) days past due or are being diligently contested in good
faith by appropriate proceedings, so long as such proceedings satisfy the
conditions for the continuation of proceedings to contest Taxes set forth in
Section 13.1 of the Lease;

(e) Liens of any of the types referred to in clause (d) above that have been
bonded for not less than the full amount in dispute (or as to which other
security arrangements satisfactory to the Lessor and the Agent have been made),
which bonding (or arrangements) shall comply with applicable Legal Requirements,
and shall have effectively stayed any execution or enforcement of such Liens;

(f) Liens arising out of judgments or awards with respect to which appeals or
other proceedings for review are being prosecuted in good faith and for the
payment of which adequate reserves have been provided as required by GAAP or
other appropriate provisions have been made, so long as such proceedings have
the effect of staying the execution of such judgments or awards and satisfy the
conditions for the continuation of proceedings to contest Taxes set forth in
Section 13.1 of the Lease;

(g) Liens in favor of municipalities to the extent agreed to by the Lessor and
the Agent;

 

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(h) all encumbrances, exceptions, restrictions, easements, rights of way,
servitudes, encroachments and irregularities in title, other than Liens which,
in the reasonable assessment of the Agent, will have a Material Adverse Effect;
and

(i) any other Lien expressly consented to or approved by the Agent.

“Person” shall mean any individual, corporation, partnership, limited liability
company, joint venture, association, joint stock company, trust, unincorporated
organization, governmental authority or any other entity.

“Plan” means any employee pension benefit plan (other than a Multiemployer Plan)
subject to the provisions of Title IV of ERISA or Section 412 of the Code or
Section 302 of ERISA, and in respect of which the Lessee or any ERISA Affiliate
is (or, if such plan were terminated, would under Section 4069 of ERISA be
deemed to be) an “employer” as defined in Section 3(5) of ERISA.

“Plans and Specifications” shall mean, with respect to Improvements and other
components of the Property, the as-built plans and specifications for such
Improvements and other components of the Property.

“Post-Expiration Date Balance” shall mean the sum of (i) the remaining
Termination Value for the Property after application of the Maximum Residual
Guarantee Amount actually paid to Lessor on the Expiration Date pursuant to
Section 22.1(b) of the Lease, (ii) all reasonable costs and expenses incurred by
or payable to Lessor (including management, supervisory or any remarketing fees
payable to any Person, including Lessor) following the Expiration Date to
maintain, lease or sell the Property (including any allocated internal costs of
Lessor), and (iii) an amount equal to the amount of holdover Rent that Lessor
would have received under Article XXIII of the Lease if Lessee had remained in
possession of the Property during the period following the Expiration Date
through the date Lessor recovers gross proceeds of sale (without deduction for
any marketing, closing or other costs, prorations or commissions) equal to the
sum of items (i) and (ii) above.

“Primary Financing Parties” shall mean the Credit Lenders, the Mortgage Lenders,
the Lessor and any other banks, financial institutions or other institutional
investors which may be from time to time a Credit Lender, a Mortgage Lender or
the Lessor.

“Primary Financing Party Balance” shall mean, with respect to any Primary
Financing Party as of any date of determination: (i) with respect to any Credit
Lender, the outstanding principal amount of the Credit Loans owed to such Credit
Lender at such time or (ii) with respect to any Mortgage Lender, the outstanding
principal amount of the Mortgage Loans owed to such Mortgage Lender at such time
or (iii) with respect to the Lessor, the outstanding principal amount of the
Lessor Advance at such time, plus, in each case, all accrued and unpaid interest
and Lessor Yield, as the case may be, thereon.

“Primary Financing Party Financing Statements” shall mean UCC financing
statements and fixture filings appropriately completed for filing in the
applicable jurisdiction in order to procure a security interest in favor of the
Agent in the Collateral subject to the Security Documents.

“Prime Lending Rate” shall have the meaning given to such term in the definition
of ABR.

“Priority Indebtedness” means, without duplication, (a) all Indebtedness, and
the principal amount of the obligations under any Hedging Agreements, of any
Subsidiary (other than any Guarantor) and (b) all Indebtedness, and the
principal amount of the obligations under any Hedging Agreements, of the Lessee
or any Subsidiary that is secured by any Lien on any asset of the Borrower or
any Subsidiary or that is referred to in clause (d), (f), (h) or (k) of the
definition of “Indebtedness”.

 

Appendix A - 27

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“Property” shall mean the properties described on the schedules to the Lease
Supplement and in the attachments to the applicable Mortgage Instruments
(including, without limitation, all of the Land and the Improvements related
thereto).

“Property Cost” shall mean, with respect to the Property at any date of
determination, an amount equal to the aggregate sum of the Lessor Property Cost
plus the Mortgage Loan Property Cost plus the Credit Loan Property Cost.

“Purchase Option” shall have the meaning given to such term in Section 20.1 of
the Lease.

“Purchasing Credit Lender” shall have the meaning given to such term in
Section 9.8(a) of the Credit Note Loan Agreement.

“Purchasing Mortgage Lender” shall have the meaning given to such term in
Section 9.8(a) of the Mortgage Note Loan Agreement.

“QPAM Exemption” shall mean Prohibited Transaction Class Exemption 84-14 issued
by the United States Department of Labor.

“Rating Agencies” shall mean Moody’s, S&P and Fitch or, in each case, any
successor nationally recognized statistical rating organization.

“Reasonable Settlement Amount” shall mean, with respect to any Claim, the
maximum amount that a prudent Person in the position of the Indemnified Person,
but able to pay any amount, might reasonably agree to pay to settle the Claim,
taking into account the nature and amount of the Claim, the relevant facts and
circumstances known to such Indemnified Person at the time of settlement and the
additional attorneys’ fees and other costs of defending the Claim which could be
anticipated but for the settlement.

“Receivables Facility” means a Receivables Lending Facility or a Receivables
Purchase Facility.

“Receivables Lending Facility” means one or more credit, loan or similar
facilities established by the Lessee, the obligations under which are secured by
accounts receivable of the Lessee and its Subsidiaries.

“Receivables Purchase Facility” means one or more facilities established by the
Lessee under which the Lessee and its Subsidiaries may sell accounts receivable,
on a non-recourse basis, to one or more financial institutions or special
purpose entities.

“Register” shall have the meaning given to such term in Section 9.9(a) of the
Mortgage Note Loan Agreement.

“Regulation D” shall mean Regulation D of the Board, as the same may be modified
and supplemented and in effect from time to time.

“Regulation T” shall mean Regulation T of the Board, as the same may be modified
and supplemented and in effect from time to time.

 

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“Regulation U” shall mean Regulation U of the Board, as the same may be modified
and supplemented and in effect from time to time.

“Regulation X” shall mean Regulation X of the Board, as the same may be modified
and supplemented and in effect from time to time.

“Release” shall mean any release, pumping, pouring, emptying, injecting,
escaping, leaching, dumping, seepage, spill, leak, flow, discharge, disposal or
emission of a Hazardous Substance.

“Rent” shall mean, collectively, the Basic Rent and the Supplemental Rent, in
each case payable under the Lease.

“Reportable Event” shall have the meaning specified in Section 4043 of ERISA.

“Requested Funds” shall mean any funds requested by the Lessee in accordance
with Section 5 of the Participation Agreement.

“Requisition” shall have the meaning specified in Section 4.2 of the
Participation Agreement.

“Responsible Officer” shall mean the Chairman or Vice Chairman of the Board of
Directors, the Chief Executive Officer, the President, any Senior Vice President
or Executive Vice President, any Vice President, the Secretary, any Assistant
Secretary, the Treasurer, or any Assistant Treasurer.

“Restricted Payment” means (a) any dividend or other distribution (whether in
cash, securities or other property) with respect to any shares of stock or other
equity interests in the Lessee, or any payment (whether in cash, securities or
other property), on account of the purchase, redemption, retirement,
acquisition, cancelation or termination of any shares of stock or other equity
interests in the Lessee.

“Revolver Loans” means the loans made by the Revolving Credit Lenders to the
Lessee pursuant to the Lessee Credit Agreement.

“Revolving Credit Lenders” means, collectively, the parties to the Lessee Credit
Agreement from time to time referenced therein as “Lenders”.

“Rule 144A” shall mean Rule 144A of the Securities Act.

“S&P” shall mean Standard and Poor’s Rating Group, a division of The McGraw-Hill
Companies, Inc.

“Sale Date” shall have the meaning given to such term in Section 20.3(a) of the
Lease.

“Sale Notice” shall mean a notice given to the Agent in connection with the
election by the Lessee of its Sale Option.

“Sale Option” shall have the meaning given to such term in Section 20.1 of the
Lease.

“Sale Proceeds Shortfall” shall mean the amount by which the proceeds of a sale
described in Section 22.1 of the Lease are less than the Limited Recourse Amount
with respect to the Property if it has been determined that the Fair Market
Sales Value of the Property at the expiration of the term of the Lease has been
impaired by greater than ordinary wear and tear during the Term of the Lease.

 

Appendix A - 29

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“Scheduled Interest Payment Date” shall mean (a) as to any Eurodollar Financing,
the last day of the Interest Period applicable to such Eurodollar Financing,
(b) as to any ABR Financing, the first day of each month (provided, the first
Scheduled Interest Payment Date pursuant to this clause (b) shall be August 1,
2010), unless such day is not a Business Day and in such case on the next
occurring Business Day and (c) as to all Financings, the date of any voluntary
or involuntary payment, prepayment, return or redemption, and the Maturity Date
or the Expiration Date, as the case may be.

“Second Priority Liens” shall have the meaning given to such term in Section 3.1
of the Intercreditor Agreement.

“Secured Parties” shall have the meaning given to such term in the Security
Agreement.

“Securities Act” shall mean the Securities Act of 1933, as amended, together
with the rules and regulations promulgated thereunder.

“Securitization Transaction” means any transfer by the Lessee or any Subsidiary
of accounts receivable or interests therein, in a “true sale” transaction,
(a) to a trust, partnership, corporation or other entity, which transfer is
funded by the incurrence or issuance by the transferee or any successor
transferee of indebtedness or other securities that are to receive payments
from, or that represent interests in, the cash flow derived from such accounts
receivable or interests therein, or (b) directly to one or more investors or
other purchasers. The “amount” or “principal amount” of any Securitization
Transaction shall be deemed at any time to be the aggregate principal or stated
amount of the Indebtedness or other securities referred to in such clause or, if
there shall be no such principal or stated amount, the uncollected amount of the
accounts receivable or interests therein transferred pursuant to such
Securitization Transaction net of any such accounts receivable or interests
therein that have been written off as uncollectible.

“Security Agreement” shall mean the Amended and Restated Security Agreement
dated as of the Closing Date between the Borrower and the Agent, for the benefit
of the Secured Parties, and accepted and agreed to by the Lessee.

“Security Assets” shall have the meaning given to such term in Section 2 of the
Security Agreement.

“Security Documents” shall mean the collective reference to the Security
Agreement, the Mortgage Instruments, the Lease (to the extent the Lease is
construed as a security instrument), the UCC Financing Statements and all other
security documents hereafter delivered to the Agent granting a Lien on any asset
or assets of any Person to secure the obligations and liabilities of the
Borrower under the Credit Note Loan Agreement, the Mortgage Note Loan Agreement
and/or under any of the other Credit Documents or the obligations and
liabilities of the Lessee under the Lease and/or under the other Operative
Agreements.

“Security Right” shall have the meaning given to such term in Section 7.1(b) of
the Lease.

“Senior Secured Party” shall have the meaning given to such term in Section 1.1
of the Intercreditor Agreement.

“Soft Costs” shall mean all costs which are ordinarily and reasonably incurred
in relation to the acquisition of the Property by the Lessor, including without
limitation structuring fees, administrative fees, legal fees, upfront fees, fees
and expenses related to appraisals, title examinations, title insurance,
document recordation, surveys, environmental site assessments, geotechnical soil
investigations and

 

Appendix A - 30

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similar costs and professional fees customarily associated with a real estate
closing, the fees and expenses of the Lessor payable or reimbursable under the
Operative Agreements and costs and expenses incurred pursuant to Sections 7.3(a)
and 7.3(b) of the Participation Agreement.

“Specified Collateral” shall have the meaning given to such term in
Section 7.1(b) of the Lease.

“subsidiary” means, with respect to any Person (the “parent”) at any date, any
corporation, limited liability company, partnership, association or other entity
the accounts of which would be consolidated with those of the parent in the
parent’s consolidated financial statements if such financial statements were
prepared in accordance with GAAP as of such date, as well as any other
corporation, limited liability company, partnership, association or other entity
(a) of which securities or other ownership interests representing more than 50%
of the equity or more than 50% of the ordinary voting power or, in the case of a
partnership, more than 50% of the general partnership interests are, as of such
date, owned, controlled or held, or (b) that is, as of such date, otherwise
Controlled, by the parent or one or more subsidiaries of the parent or by the
parent and one or more subsidiaries of the parent.

“Subsidiary” means any subsidiary of the Lessee.

“Supplemental Amounts” shall have the meaning given to such term in Section 9.18
of the Credit Note Loan Agreement or Section 9.18 of the Mortgage Note Loan
Agreement, respectively.

“Supplemental Rent” shall mean all amounts, liabilities and obligations (other
than Basic Rent) which the Lessee assumes or agrees to pay to the Lessor, the
Agent, the Primary Financing Parties or any other Person under the Lease or
under any of the other Operative Agreements including without limitation
payments of the Termination Value and the Maximum Residual Guarantee Amount and
all indemnification amounts, liabilities and obligations.

“Tax Affiliate” means, with respect to any corporate Person, any member of an
affiliated group (within the meaning of Section 1504(a) of the Code or any
similar provision of state or local law) in which such Person is a member,
“former Tax Affiliate” means, with respect to any corporate Person, any other
Person that had been but is not currently affiliated (within the meaning of
Section 1504(a) of the Code or any similar provision of state or local law) with
such Person, with respect to the period of their affiliation.

“Taxes” means any and all present or future taxes, levies, imposts, duties,
deductions, charges or withholdings imposed by any Governmental Authority.

“Term” shall mean the Basic Term.

“Termination Date” shall have the meaning specified in Section 16.2(a) of the
Lease.

“Termination Event” shall mean (a) with respect to any Pension Plan, the
occurrence of a Reportable Event or an event described in Section 4062(e) of
ERISA, (b) the withdrawal of the Lessee or any ERISA Affiliate from a Multiple
Employer Plan during a plan year in which it was a substantial employer (as such
term is defined in Section 4001(a)(2) of ERISA), or the termination of a
Multiple Employer Plan, (c) the distribution of a notice of intent to terminate
a Plan or Multiemployer Plan pursuant to Section 4041(a)(2) or 4041A of ERISA,
(d) the institution of proceedings to terminate a Plan or Multiemployer Plan by
the PBGC under Section 4042 of ERISA, (e) any other event or condition which
might constitute grounds under Section 4042 of ERISA for the termination of, or
the appointment of a trustee to administer, any Plan or Multiemployer Plan, or
(f) the complete or partial withdrawal of the Lessee or any ERISA Affiliate from
a Multiemployer Plan.

 

Appendix A - 31

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“Termination Notice” shall have the meaning specified in Section 16.1 of the
Lease.

“Termination Value” shall mean the sum of (a) the outstanding aggregate
principal amount of the Credit Loans, plus (b) the outstanding aggregate
principal amount of the Mortgage Loans, plus (c) the outstanding aggregate
principal amount of the Lessor Advance, plus (d) any accrued and unpaid interest
owing to the Credit Lenders under the Credit Notes and the Mortgage Lenders
under the Mortgage Notes and any accrued and unpaid Lessor Yield owning to the
Lessor under the Operative Agreements, plus (e) any amounts payable pursuant to
Section 11.4 of the Participation Agreement, plus (f) to the extent the same is
not duplicative of the amounts payable under clauses (a) through (e) above, all
other Rent and other amounts then due and payable or accrued under the Lease
and/or under any other Operative Agreement (including without limitation amounts
under Sections 11.1 and 11.2 of the Participation Agreement and all costs and
expenses referred to in clause FIRST of Section 22.2 of the Lease).

“Transaction Expenses” shall mean all Soft Costs and all other costs and
expenses incurred in connection with the preparation, execution and delivery of
the Operative Agreements and the transactions contemplated by the Operative
Agreements including without limitation all costs and expenses described in
Section 7 of the Participation Agreement and the following:

(a) the reasonable fees, out-of-pocket expenses and disbursements of Moore & Van
Allen PLLC and Holland & Knight LLP, as counsel to certain of the Financing
Parties, and of counsel to the Lessee in negotiating the terms of the Operative
Agreements and the other transaction documents, preparing for the closings
under, and rendering opinions in connection with, such transactions and in
rendering other services customary for counsel representing parties to
transactions of the types involved in the transactions contemplated by the
Operative Agreements, but excluding in all cases the fees, expenses and
disbursements of counsel to any individual Credit Lender or Mortgage Lender;

(b) the reasonable fees, out-of-pocket expenses and disbursements of accountants
for the Lessee in connection with the transaction contemplated by the Operative
Agreements;

(c) any and all other reasonable fees, charges or other amounts payable to the
Primary Financing Parties, the Agent, or any broker which arises under any of
the Operative Agreements;

(d) any other reasonable fees, out-of-pocket expenses, disbursements or costs of
any party to the Operative Agreements or any of the other transaction documents;
and

(e) any and all Taxes and fees incurred in recording or filing any Operative
Agreement or any other transaction document, any deed, declaration, mortgage,
security agreement, notice or financing statement with any public office,
registry or governmental agency in connection with the transactions contemplated
by the Operative Agreements.

“Transactions” means (a) the execution, delivery and performance by the Credit
Parties of the Operative Agreements to which any Credit Party, as applicable, is
a party and (b) the extension of the Credit Loans, the Mortgage Loans and the
Lessor Advances and the use of proceeds thereof as contemplated pursuant to
Section 1 of this Agreement.

“Tribunal” shall mean any state, commonwealth, federal, foreign, territorial, or
other court or government body, subdivision agency, department, commission,
board, bureau or instrumentality of a governmental body.

 

Appendix A - 32

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“Type” shall mean, as to any Financing, whether it is an ABR Financing or a
Eurodollar Financing.

“UCC Financing Statements” shall mean collectively the Primary Financing Party
Financing Statements and the Lessor Financing Statements.

“Unfunded Liability” shall mean, with respect to any Plan, at any time, the
amount (if any) by which (a) the present value of all accrued benefits under
such Plan exceeds (b) the fair market value of all Plan assets allocable to such
benefits, all determined as of the then most recent valuation date for such
Plan, but only to the extent that such excess represents a potential liability
of the Lessee or any member of the Controlled Group to the PBGC or such Plan
under Title IV of ERISA.

“Uniform Commercial Code” and “UCC” shall mean the Uniform Commercial Code as in
effect in any applicable jurisdiction.

“U.S. Person” shall have the meaning specified in Section 11.2(e) of the
Participation Agreement.

“U.S. Taxes” shall have the meaning specified in Section 11.2(e) of the
Participation Agreement.

“USA Patriot Act” means the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001
(Title III of Pub. L. No. 107-56 (signed into law October 26, 2001)).

“Wholly-Owned Entity” shall mean a Person all of the shares of capital stock or
other ownership interest of which are owned by a referent Person and/or one of
such referent Person’s wholly-owned Subsidiaries or other wholly-owned entities.

“Withdrawal Liability” means liability to a Multiemployer Plan as a result of a
complete or partial withdrawal from such Multiemployer Plan, as such terms are
defined in Part I of Subtitle E of Title IV of ERISA.

“Withholdings” shall have the meaning specified in Section 11.2(e) of the
Participation Agreement.

 

Appendix A - 33