exv10w1



 





Exhibit 10.1



EXECUTION COPY




 





SECOND AMENDED AND RESTATED CREDIT AGREEMENT




Dated as of July 27, 2007




by and among




UDR, INC.,




as Borrower,




Each of




WACHOVIA CAPITAL MARKETS, LLC,




and




J.P. MORGAN SECURITIES INC.,




as Joint Lead Arrangers




and




Joint Bookrunners,




WACHOVIA BANK, NATIONAL ASSOCIATION,




as Administrative Agent,




JPMORGAN CHASE BANK, N.A.




as Syndication Agent,




SUNTRUST BANK,

U.S. BANK NATIONAL ASSOCIATION

and

WELLS FARGO BANK, NATIONAL ASSOCIATION,




as Documentation Agents,




BANK OF AMERICA, N.A.,

CITICORP NORTH AMERICA,

LASALLE BANK NATIONAL ASSOCIATION,

MIZUHO CORPORATE BANK LTD., NEW YORK BRANCH,

PNC BANK, NATIONAL ASSOCIATION

REGIONS BANK

and

THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.,




as Co-Agents,




and

THE FINANCIAL INSTITUTIONS INITIALLY SIGNATORY HERETO

AND THEIR ASSIGNEES PURSUANT TO SECTION 12.5.,




as Lenders




 





 









 





TABLE OF CONTENTS




	 	 	 	 	 
	Article I. Definitions
	 	 	1  	 
	 
	 	 	 	 
	Section 1.1. Definitions
	 	 	1  	 
	Section 1.2. General; References to Times
	 	 	24	 
	 
	 	 	 	 
	Article II. Credit Facility
	 	 	25	 
	 
	 	 	 	 
	Section 2.1. Revolving Loans
	 	 	25	 
	Section 2.2. Bid Rate Loans
	 	 	26	 
	Section 2.3. Swingline Loans
	 	 	30	 
	Section 2.4. Letters of Credit
	 	 	32	 
	Section 2.5. Rates and Payment of Interest on Loans
	 	 	36	 
	Section 2.6. Number of Interest Periods
	 	 	37	 
	Section 2.7. Repayment of Loans
	 	 	37	 
	Section 2.8. Prepayments
	 	 	37	 
	Section 2.9. Continuation
	 	 	38	 
	Section 2.10. Conversion
	 	 	38	 
	Section 2.11. Notes
	 	 	38	 
	Section 2.12. Voluntary Reductions of the Commitment
	 	 	39	 
	Section 2.13. Expiration or Maturity Date of Letters of Credit Past Termination Date
	 	 	39	 
	Section 2.14. Amount Limitations
	 	 	39	 
	Section 2.15. Increase of Commitments
	 	 	40	 
	 
	 	 	 	 
	Article III. Payments, Fees and Other General Provisions
	 	 	41	 
	 
	 	 	 	 
	Section 3.1. Payments
	 	 	41	 
	Section 3.2. Pro Rata Treatment
	 	 	41	 
	Section 3.3. Sharing of Payments, Etc
	 	 	42	 
	Section 3.4. Several Obligations
	 	 	42	 
	Section 3.5. Minimum Amounts
	 	 	43	 
	Section 3.6. Fees
	 	 	43	 
	Section 3.7. Computations
	 	 	44	 
	Section 3.8. Usury
	 	 	44	 
	Section 3.9. Agreement Regarding Interest and Charges
	 	 	44	 
	Section 3.10. Statements of Account
	 	 	44	 
	Section 3.11. Defaulting Lenders
	 	 	45	 
	Section 3.12. Taxes
	 	 	46	 
	 
	 	 	 	 
	Article IV. Yield Protection, Etc
	 	 	48	 
	 
	 	 	 	 
	Section 4.1. Additional Costs; Capital Adequacy
	 	 	48	 
	Section 4.2. Suspension of LIBOR Loans
	 	 	49	 
	Section 4.3. Illegality
	 	 	49	 
	Section 4.4. Compensation
	 	 	50	 
	Section 4.5. Affected Lenders
	 	 	50	 
	Section 4.6. Treatment of Affected Loans
	 	 	51	 
	Section 4.7. Change of Lending Office
	 	 	51	 






 - i - 









 





	 	 	 	 	 
	Section 4.8. Assumptions Concerning Funding of LIBOR Loans
	 	 	52	 
	 
	 	 	 	 
	Article V. Conditions Precedent
	 	 	52	 
	 
	 	 	 	 
	Section 5.1. Initial Conditions Precedent
	 	 	52	 
	Section 5.2. Conditions Precedent to All Loans and Letters of Credit
	 	 	54	 
	Section 5.3. Conditions as Covenants
	 	 	55	 
	 
	 	 	 	 
	Article VI. Representations and Warranties
	 	 	55	 
	 
	 	 	 	 
	Section 6.1. Representations and Warranties
	 	 	55	 
	Section 6.2. Survival of Representations and Warranties, Etc
	 	 	61	 
	 
	 	 	 	 
	Article VII. Affirmative Covenants
	 	 	61	 
	 
	 	 	 	 
	Section 7.1. Preservation of Existence and Similar Matters
	 	 	61	 
	Section 7.2. Compliance with Applicable Law and Material Contracts
	 	 	62	 
	Section 7.3. Maintenance of Property
	 	 	62	 
	Section 7.4. Conduct of Business
	 	 	62	 
	Section 7.5. Insurance
	 	 	62	 
	Section 7.6. Payment of Taxes and Claims
	 	 	62	 
	Section 7.7. Visits and Inspections
	 	 	63	 
	Section 7.8. Use of Proceeds; Letters of Credit
	 	 	63	 
	Section 7.9. Environmental Matters
	 	 	63	 
	Section 7.10. Books and Records
	 	 	64	 
	Section 7.11. Further Assurances
	 	 	64	 
	Section 7.12. New Subsidiaries/Guarantors
	 	 	64	 
	Section 7.13. REIT Status
	 	 	65	 
	Section 7.14. Exchange Listing
	 	 	65	 
	 
	 	 	 	 
	Article VIII. Information
	 	 	65	 
	 
	 	 	 	 
	Section 8.1. Quarterly Financial Statements
	 	 	65	 
	Section 8.2. Year-End Statements
	 	 	65	 
	Section 8.3. Compliance Certificate
	 	 	66	 
	Section 8.4. Other Information
	 	 	66	 
	Section 8.5. Electronic Delivery of Certain Information
	 	 	68	 
	Section 8.6. Public/Private Information
	 	 	69	 
	 
	 	 	 	 
	Article IX. Negative Covenants
	 	 	70	 
	 
	 	 	 	 
	Section 9.1. Financial Covenants
	 	 	70	 
	Section 9.2. Restricted Payments
	 	 	70	 
	Section 9.3. Debt
	 	 	71	 
	Section 9.4. Certain Permitted Investments
	 	 	71	 
	Section 9.5. Investments Generally
	 	 	71	 
	Section 9.6. Liens; Negative Pledges; Other Matters
	 	 	72	 
	Section 9.7. Merger, Consolidation, Sales of Assets and Other Arrangements
	 	 	73	 
	Section 9.8. Fiscal Year
	 	 	74	 
	Section 9.9. Modifications to Material Contracts
	 	 	74	 
	Section 9.10. Modifications of Organizational Documents
	 	 	74	 






 - ii - 









 






	 	 	 	 	 
	Section 9.11. Transactions with Affiliates
	 	 	74	 
	Section 9.12. ERISA Exemptions
	 	 	74	 
	 
	 	 	 	 
	Article X. Default
	 	 	74	 
	 
	 	 	 	 
	Section 10.1. Events of Default
	 	 	74	 
	Section 10.2. Remedies Upon Event of Default
	 	 	77	 
	Section 10.3. Remedies Upon Default
	 	 	78	 
	Section 10.4. Allocation of Proceeds
	 	 	78	 
	Section 10.5. Collateral Account
	 	 	79	 
	Section 10.6. Performance by Agent
	 	 	80	 
	Section 10.7. Rights Cumulative
	 	 	80	 
	 
	 	 	 	 
	Article XI. The Agent
	 	 	81	 
	 
	 	 	 	 
	Section 11.1. Authorization and Action. `
	 	 	81	 
	Section 11.2. Agent’s Reliance, Etc
	 	 	81	 
	Section 11.3. Notice of Defaults
	 	 	82	 
	Section 11.4. Wachovia as Lender
	 	 	82	 
	Section 11.5. Approvals of Lenders
	 	 	83	 
	Section 11.6. Lender Credit Decision, Etc
	 	 	83	 
	Section 11.7. Indemnification of Agent and Arrangers
	 	 	84	 
	Section 11.8. Successor Agent
	 	 	85	 
	Section 11.9. Titled Agents
	 	 	85	 
	 
	 	 	 	 
	Article XII. Miscellaneous
	 	 	86	 
	 
	 	 	 	 
	Section 12.1. Notices
	 	 	86	 
	Section 12.2. Expenses
	 	 	87	 
	Section 12.3. Setoff
	 	 	87	 
	Section 12.4. Litigation; Jurisdiction; Other Matters; Waivers
	 	 	88	 
	Section 12.5. Successors and Assigns
	 	 	89	 
	Section 12.6. Amendments
	 	 	92	 
	Section 12.7. Nonliability of Agent and Lenders
	 	 	93	 
	Section 12.8. Confidentiality
	 	 	93	 
	Section 12.9. Indemnification
	 	 	94	 
	Section 12.10. Termination; Survival
	 	 	96	 
	Section 12.11. Severability of Provisions
	 	 	97	 
	Section 12.12. GOVERNING LAW
	 	 	97	 
	Section 12.13. Counterparts
	 	 	97	 
	Section 12.14. Obligations with Respect to Loan Parties
	 	 	97	 
	Section 12.15. Limitation of Liability
	 	 	97	 
	Section 12.16. Entire Agreement
	 	 	98	 
	Section 12.17. Construction
	 	 	98	 
	Section 12.18. Patriot Act
	 	 	98	 
	Section 12.19. NO NOVATION
	 	 	98	 






	 	 	 
	SCHEDULE I

	 	Commitments
	SCHEDULE 1.1(A)

	 	List of Loan Parties






 - iii - 









 






	 	 	 
	SCHEDULE 5.3.

	 	Post Agreement Date Deliveries
	SCHEDULE 6.1.(b)

	 	Ownership Structure
	SCHEDULE 6.1.(f)

	 	Title to Properties; Liens
	SCHEDULE 6.1.(g)

	 	Debt and Guaranties
	SCHEDULE 6.1.(i)

	 	Litigation
	SCHEDULE 6.1.(y)

	 	Unencumbered Assets
	 
	 	 
	EXHIBIT A

	 	Form of Assignment and Acceptance Agreement
	EXHIBIT B

	 	Form of Designation Agreement
	EXHIBIT C

	 	Form of Notice of Borrowing
	EXHIBIT D

	 	Form of Notice of Continuation
	EXHIBIT E

	 	Form of Notice of Conversion
	EXHIBIT F

	 	Form of Notice of Swingline Borrowing
	EXHIBIT G

	 	Form of Swingline Note
	EXHIBIT H

	 	Form of Bid Rate Quote Request
	EXHIBIT I

	 	Form of Bid Rate Quote
	EXHIBIT J

	 	Form of Bid Rate Quote Acceptance
	EXHIBIT K

	 	Form of Revolving Note
	EXHIBIT L

	 	Form of Bid Rate Note
	EXHIBIT M

	 	Form of Opinion of Counsel
	EXHIBIT N

	 	Form of Compliance Certificate
	EXHIBIT O

	 	Form of Guaranty






 - iv - 









 





     THIS SECOND AMENDED AND RESTATED CREDIT AGREEMENT (this “Agreement”) dated as of July 27, 2007
by and among UDR, INC., a Maryland corporation, formerly known as United Dominion Realty Trust,
Inc. (the “Borrower”), each of WACHOVIA CAPITAL MARKETS, LLC and J.P. MORGAN SECURITIES INC., as
Joint Lead Arrangers (each a “Joint Lead Arranger”) and as Joint Bookrunners (the “Joint
Bookrunners”), WACHOVIA BANK, NATIONAL ASSOCIATION, as Agent, JPMORGAN CHASE BANK, N.A., as
Syndication Agent (the “Syndication Agent”), each of SUNTRUST BANK, U.S. BANK NATIONAL ASSOCIATION
and WELLS FARGO BANK, NATIONAL ASSOCIATION, as Documentation Agent (each a “Documentation Agent”),
each of BANK OF AMERICA, N.A., CITICORP NORTH AMERICA, LASALLE BANK NATIONAL ASSOCIATION, MIZUHO
CORPORATE BANK LTD., NEW YORK BRANCH, PNC BANK, NATIONAL ASSOCIATION, REGIONS BANK and THE BANK OF
TOKYO-MITSUBISHI UFJ, LTD., as Co-Agent (each a “Co-Agent”), and each of the financial institutions
initially a signatory hereto together with their assignees pursuant to Section 12.5.



     WHEREAS, certain of the Lenders and other financial institutions have made available to
Borrower a $500,000,000 revolving credit facility on the terms and conditions contained in that
certain Amended and Restated Credit Agreement dated as of May 25, 2005 (as amended and in effect
immediately prior to the date hereof, the “Existing Credit Agreement”) by and among the Borrower,
such Lenders, certain other financial institutions, the Agent and the other parties thereof; and



     WHEREAS, the Agent and the Lenders desire to amend and restate the terms of the Existing
Credit Agreement to make available to the Borrower a revolving credit facility in the initial
amount of $600,000,000, which will include a $50,000,000 letter of credit subfacility and a
$50,000,000 swingline subfacility, on the terms and conditions contained herein.



     NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged by the parties hereto, the parties hereto agree that the Existing Credit
Agreement is amended and restated in its entirety as follows:



Article I. Definitions




Section 1.1. Definitions.




     In addition to terms defined elsewhere herein, the following terms shall have the following
meanings for the purposes of this Agreement:



     “1031 Property” means property held by a “qualified intermediary” in connection with the sale
of such property by the Borrower, a Subsidiary or Unconsolidated Affiliate pursuant to, and
qualifying for tax treatment under, Section 1031 of the Internal Revenue Code.



     “Absolute Rate” has the meaning given that term in Section 2.2.(c)(ii)(C).



     “Absolute Rate Auction” means a solicitation of Bid Rate Quotes setting forth Absolute Rates
pursuant to Section 2.2.



 









 





     “Absolute Rate Loan” means a Bid Rate Loan, the interest rate on which is determined on the
basis of an Absolute Rate pursuant to an Absolute Rate Auction.



     “Accession Agreement” means an Accession Agreement substantially in the form of Annex I to the
Guaranty.



     “Additional Costs” has the meaning given that term in Section 4.1.



     “Adjusted Eurodollar Rate” means, with respect to each Interest Period for any LIBOR Loan, the
rate obtained by dividing (a) LIBOR for such Interest Period by (b) a percentage equal to 1 minus
the stated maximum rate (stated as a decimal) of all reserves, if any, required to be maintained
with respect to Eurocurrency funding (currently referred to as “Eurocurrency liabilities”) as
specified in Regulation D of the Board of Governors of the Federal Reserve System (or against any
other category of liabilities which includes deposits by reference to which the interest rate on
LIBOR Loans is determined or any category of extensions of credit or other assets which includes
loans by an office of any Lender outside of the United States of America to residents of the United
States of America). Any change in such maximum rate shall result in a change in Adjusted
Eurodollar Rate on the date on which such change in such maximum rate becomes effective.



     “Administrative Details Form” means an Administrative Details Reply Form in a form supplied by
the Agent to the Lenders from time to time.



     “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. In no event shall the Agent or any Lender be deemed to be an
Affiliate of the Borrower.



     “Agent” means Wachovia Bank, National Association, as contractual representative for the
Lenders under the terms of this Agreement, and any of its successors.



     “Agreement Date” means the date as of which this Agreement is dated.



     “Applicable Law” means all applicable provisions of constitutions, statutes, rules,
regulations and orders of all governmental bodies and all orders and decrees of all courts,
tribunals and arbitrators.



     “Applicable Margin” means the percentage per annum determined, at any time, based on the range
into which the Borrower’s Credit Rating then falls, in accordance with the levels in the table set
forth below (each a “Level”). Any change in the Borrower’s Credit Rating which would cause it to
move to a different Level in such table shall effect a change in the Applicable Margin on the
Business Day on which such change occurs. During any period that the Borrower has received Credit
Ratings that are not equivalent, the Applicable Margin shall be determined
by the higher of such two Credit Ratings; provided, however, that if the ratings of S&P and Moody’s
are two pricing Levels apart, then the Applicable Margin shall be based on the Level that falls
between the Levels that correspond to the ratings of S&P and Moody’s. During any



- 2 -









 







period for which
the Borrower has received a Credit Rating from only one Rating Agency, then the Applicable Margin
shall be determined based on such Credit Rating. During any period for which the Borrower has not
received a Credit Rating from either Rating Agency, then the Applicable Margin shall be determined
based on Level 5. As of the Agreement Date, and thereafter until changed as provided above, the
Applicable Margin shall be determined based on Level 3.



	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Borrower’s Credit Rating	 	Applicable Margin	 	Applicable Margin
	Level	 	(S&P/Moody’s)	 	for LIBOR Loans	 	for Base Rate Loans
	 	1	 	 	A-/A3

	 	 	0.325	%	 	 	0.0	%
	 	2	 	 	BBB+/Baa1

	 	 	0.375	%	 	 	0.0	%
	 	3	 	 	BBB/Baa2

	 	 	0.475	%	 	 	0.0	%
	 	4	 	 	BBB-/Baa3

	 	 	0.750	%	 	 	0.0	%
	 	5	 	 	< BBB-/Baa3

	 	 	1.050	%	 	 	0.25	%






     “Arrangers” means Wachovia Capital Markets, LLC and J.P. Morgan Securities Inc., together with
their respective successors and permitted assigns.



     “Assignee” has the meaning given that term in Section 12.5.(d).



     “Assignment and Acceptance Agreement” means an Assignment and Acceptance Agreement among a
Lender, an Assignee and the Agent, substantially in the form of Exhibit A.



     “Base Rate” means the per annum rate of interest equal to the greater of (a) the Prime Rate or
(b) the Federal Funds Rate plus one-half of one percent (0.5%). Any change in the Base Rate
resulting from a change in the Prime Rate or the Federal Funds Rate shall become effective as of
12:01 a.m. on the Business Day on which each such change occurs. The Base Rate is a reference rate
used by the Lender acting as the Agent in determining interest rates on certain loans and is not
intended to be the lowest rate of interest charged by the Lender acting as the Agent or any other
Lender on any extension of credit to any debtor.



     “Base Rate Loan” means a Revolving Loan bearing interest at a rate based on the Base Rate.



     “Benefit Arrangement” means at any time an employee benefit plan within the meaning of Section
3(3) of ERISA which is not a Plan or a Multiemployer Plan and which is maintained or otherwise
contributed to by any member of the ERISA Group.



     “Bid Rate Borrowing” has the meaning given that term in Section 2.2.(b).



     “Bid Rate Loan” means a loan made by a Lender under Section 2.2.



     “Bid Rate Notes” has the meaning given that term in Section 2.11.(b).



     “Bid Rate Quote” means an offer in accordance with Section 2.2.(c) by a Lender to make a Bid
Rate Loan with one single specified interest rate.



- 3 -









 





     “Bid Rate Quote Request” has the meaning given that term in Section 2.2.(b).



     “Borrower” has the meaning set forth in the introductory paragraph hereof and shall include
the Borrower’s successors and permitted assigns.



     “Business Day” means (a) any day other than a Saturday, Sunday or other day on which banks in
Charlotte, North Carolina or New York, New York are authorized or required to close and (b) with
reference to a LIBOR Loan, any such day that is also a day on which dealings in Dollar deposits are
carried out in the London interbank market.



     “Capitalized Lease Obligation” means an obligation under a lease that is required to be
capitalized for financial reporting purposes in accordance with GAAP. The amount of a Capitalized
Lease Obligation is the capitalized amount of such obligation determined in accordance with GAAP.



     “Cash Equivalents” means: (a) securities issued, guaranteed or insured by the United States of
America or any of its agencies with maturities of not more than one year from the date acquired;
(b) certificates of deposit with maturities of not more than one year from the date acquired issued
by a United States federal or state chartered commercial bank of recognized standing, or a
commercial bank organized under the laws of any other country which is a member of the Organization
for Economic Cooperation and Development, or a political subdivision of any such country, acting
through a branch or agency, which bank has capital and unimpaired surplus in excess of
$500,000,000.00 and which bank or its holding company has a short-term commercial paper rating of
at least A-2 or the equivalent by S&P or at least P-2 or the equivalent by Moody’s; (c) reverse
repurchase agreements with terms of not more than seven days from the date acquired, for securities
of the type described in clause (a) above and entered into only with commercial banks having the
qualifications described in clause (b) above; (d) commercial paper issued by any Person
incorporated under the laws of the United States of America or any State thereof and rated at least
A-2 or the equivalent thereof by S&P or at least P-2 or the equivalent thereof by Moody’s, in each
case with maturities of not more than one year from the date acquired; and (e) investments in money
market funds registered under the Investment Company Act of 1940, which have net assets of at least
$500,000,000.00 and at least 85% of whose assets consist of securities and other obligations of the
type described in clauses (a) through (d) above.



     “Change of Control” means the occurrence of either of the following events: (i) any Person or
two or more Persons acting in concert shall have acquired beneficial ownership, directly or
indirectly, of, or shall have acquired by contract or otherwise, or shall have entered into a
contract or arrangement that, upon consummation, will result in its or their acquisition of, or
control over, voting stock of the Borrower (or other securities convertible into such voting stock)
representing 35% or more of the combined voting power of all voting stock of the Borrower, or (ii)
during any period of up to 24 consecutive months, commencing after the Agreement Date, individuals
who at the beginning of such 24 month period were directors of the Borrower (together with any new
director whose election by the Borrower’s Board of Directors or whose nomination for election by
the Borrower’s shareholders was approved by a vote of at least two-thirds of the directors then still



- 4 -









 







in office who either were directors at the beginning of such period or whose election or
nomination for election was previously so approved) cease for any reason to constitute a majority
of the directors of the Borrower then in office. As used herein, “beneficial ownership” shall have
the meaning provided in Rule 13d-3 of the Securities and Exchange Commission under the Securities
Exchange Act of 1934.



     “Collateral Account” means a special non-interest bearing deposit account or securities
account maintained by, or on behalf of, the Agent and under its sole dominion and control, for the
benefit of the Lenders.



     “Commitment” means, as to each Lender (other than the Swingline Lender), such Lender’s
obligation (a) to make Revolving Loans pursuant to Section 2.1., (b) to issue (in the case of the
Lender then acting as Agent) or participate in (in the case of the other Lenders) Letters of Credit
pursuant to Section 2.4.(a) and 2.4.(i), respectively (but in the case of the Lender acting as the
Agent excluding the aggregate amount of participations in the Letters of Credit held by the other
Lenders), and (c) to participate in Swingline Loans pursuant to Section 2.3.(e), in each case, in
an amount up to, but not exceeding, the amount set forth for such Lender on Schedule I as such
Lender’s “Commitment” or as set forth in the applicable Assignment and Acceptance Agreement, as the
same may be reduced from time to time pursuant to Section 2.12. or increased or reduced as
appropriate to reflect any assignments to or by such Lender effected in accordance with Section
12.5.



     “Commitment Percentage” means, as to each Lender, the ratio, expressed as a percentage, of (a)
the amount of such Lender’s Commitment to (b) the aggregate amount of the Commitments of all
Lenders hereunder; provided, however, that if at the time of determination the Commitments have
terminated or been reduced to zero, the “Commitment Percentage” of each Lender shall be the
Commitment Percentage of such Lender in effect immediately prior to such termination or reduction.



     “Compliance Certificate” has the meaning given that term in Section 8.3.



     “Condominium Property” means a Multifamily Property that has been converted into residential
condominium units for the purpose of sale. For purposes of this definition and the definition of
“Condominium Property Value” a Multifamily Property will be deemed “converted” into residential
condominium units once both of the following have occurred: (a) notice of the conversion has been
sent to the tenants of such Property; and (b) a declaration of condominium or other similar
document is filed with the applicable Governmental Authority.



     “Condominium Property Value” means the sum of the following: (a) the Consolidated Net
Operating Income attributable to such Property for the two quarter period annualized ending
immediately prior to such conversion divided by 6.75%, plus (b) the of cost of capital improvements
made to such Property in connection with such conversion not to exceed 35% of the amount determined
in accordance with the preceding clause (a), minus (c) 90% of the actual
contractual sales price of each individual condominium unit sale prior to any deductions for
commissions, fees and any other expenses; provided, however, no value will be attributed to such
Condominium Property 24 months after its conversion. In addition, no value shall be



- 5 -









 







attributable to a Condominium Property at any time following the earlier of (x) all condominium units of such
Property having been sold or otherwise conveyed, (y) the management of such Property having been
turned over to such Property’s homeowners’ association and (z) less than 10% of the units remain
unsold.



     “Consolidated Adjusted EBITDA” means, for any period for the Consolidated Group, the sum of
Consolidated EBITDA for such period minus a reserve equal to $50.00 per apartment unit
located on a Property per quarter (or $200 per apartment unit located on a Property per year)
minus the Borrower’s pro rata share of such reserves (determined in a manner consistent
with this definition of Consolidated Adjusted EBITDA) of any Unconsolidated Affiliates of the
Borrower.



     “Consolidated Adjusted Tangible Net Worth” means at any date (a) the sum of (i) the
consolidated shareholders’ equity of the Consolidated Group determined on a consolidated basis (net
of Minority Interests) plus (ii) accumulated depreciation of Properties owned by a member
of the Consolidated Group to the extent reflected in the then book value of the Consolidated Assets
minus, without duplication, (b) the Intangible Assets of the Consolidated Group.



     “Consolidated Assets” means the assets of the members of the Consolidated Group determined in
accordance with GAAP on a consolidated basis.



     “Consolidated EBITDA” means for any period for the Consolidated Group, Consolidated Net Income
(including Consolidated Net Income attributable to units of Condominium Properties prior to the
sale thereof) excluding the following amounts (but only to the extent included in determining
Consolidated Net Income for such period) (a) Consolidated Interest Expense; (b) all provisions for
any Federal, state or other income taxes; (c) depreciation, amortization and other non-cash
charges; (d) gains and losses on Investments and extraordinary gains and losses; (e) taxes on such
excluded gains and tax deductions or credits on account of such excluded losses, in each case on a
consolidated basis determined in accordance with GAAP; and (f) to the extent not already included
in the immediately preceding clauses (b) through (e), the Borrower’s pro rata share of such items
of each Unconsolidated Affiliate of the Borrower for such period. Consolidated EBITDA shall
include gain or loss, in either case, realized on the sale of any portion of a Condominium Property
or other gain or loss on property sales by any taxable REIT subsidiary to the extent they are
included in the Borrower’s funds from operation (without duplication of income on condominium
units).



     “Consolidated Funded Debt” means total Debt of the Consolidated Group on a consolidated basis
determined in accordance with GAAP (excluding the aggregate amount, not to exceed $25,000,000,
available to be drawn under letters of credit issued in respect of normal operating expenses of
such Person) plus the Borrower’s pro rata share of the Debt of any Unconsolidated Affiliate
of the Borrower.



     “Consolidated Group” means the Borrower and its consolidated Subsidiaries, as determined in
accordance with GAAP.



- 6 -









 





     “Consolidated Interest Expense” means for any period for the Consolidated Group, (a) all
interest expense, including the amortization of debt discount and premium, the interest component
under capital leases and capitalized interest expense (other than capitalized interest funded from
a construction loan interest reserve account held by another lender and not included in the
calculation of cash for balance sheet reporting purposes), in each case on a consolidated basis
determined in accordance with GAAP plus (b) to the extent not already included in the
foregoing clause (a), the Borrower’s pro rata share of all interest expense (determined in a manner
consistent with this definition of Consolidated Interest Expense) for such period of Unconsolidated
Affiliates of the Borrower.



     “Consolidated Net Income” means for any period, the net income of the Consolidated Group on a
consolidated basis determined in accordance with GAAP, including the Borrower’s pro rata share of
the net income of each Unconsolidated Affiliate of the Borrower for such period.



     “Consolidated Net Operating Income” means, for any period for any Multifamily Property owned
by a member of the Consolidated Group or an Unconsolidated Affiliate, an amount equal to (a) the
aggregate rental and other income from the operation of such Multifamily Property during such
period minus (b) all expenses and other proper charges incurred in connection with the
operation of such Multifamily Property (including, without limitation, real estate taxes and bad
debt expenses) during such period and an imputed management fee in the amount of 3.0% of the
aggregate rents received for such Multifamily Property during such period; but, in any case, before
payment of or provision for debt service charges for such period, income taxes for such period, and
depreciation, amortization and other non-cash expenses for such period, all on a consolidated basis
determined in accordance with GAAP. For purposes of determining Consolidated Net Operating Income,
only the Borrower’s pro rata share of the Consolidated Net Operating Income of any such Property
owned by an Unconsolidated Affiliate of the Borrower shall be used.



     “Consolidated Secured Debt” means, as of any given date, all Consolidated Funded Debt that is
secured in any manner by any Lien.



     “Consolidated Total Fixed Charges” means for any period, the sum of (a) the cash portion of
Consolidated Interest Expense paid during such period plus (b) regularly scheduled
principal payments on Consolidated Funded Debt during such period (excluding any balloon, bullet or
similar principal payment payable on any Consolidated Funded Debt which repays such Consolidated
Funded Debt in full) plus (c) all cash dividends and distributions on Preferred Equity
Interests of members of the Consolidated Group paid during such period, all on a consolidated basis
determined in accordance with GAAP.



     “Consolidated Unsecured Debt” means, as of a given date, all Consolidated Funded Debt that is
not Consolidated Secured Debt.



     “Continue”, “Continuation” and “Continued” each refers to the continuation of a LIBOR Loan
from one Interest Period to another Interest Period pursuant to Section 2.9.



- 7 -









 





     “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.



     “Convert”, “Conversion” and “Converted” each refers to the conversion of a Revolving Loan of
one Type into a Loan of another Type pursuant to Section 2.10.



     “Credit Event” means any of the following: (a) the making (or deemed making) of any Loan, (b)
the Conversion of a Loan and (c) the issuance of a Letter of Credit.



     “Credit Rating” means the rating assigned by a Rating Agency to the senior unsecured long term
indebtedness of a Person.



     “Debt” of any Person means at any date, without duplication; (a) all obligations of such
Person for borrowed money; (b) all obligations of such Person evidenced by bonds, debentures, notes
or other similar instruments; (c) all obligations of such Person to pay the deferred purchase price
of property or services (other than trade accounts payable arising in the ordinary course of
business); (d) all Capitalized Lease Obligations of such Person; (e) all obligations of such Person
to purchase securities or other property which arise out of or in connection with the sale of the
same or substantially similar securities or property; (f) all obligations of such Person to
reimburse any bank or other person in respect of amounts payable under a letter of credit or
similar instrument (being the amount available to be drawn thereunder, whether or not then drawn);
(g) all obligations of others secured by a Lien on any asset of such Person, whether or not such
obligation is assumed by such Person; (h) all obligations of others Guaranteed by such Person; (i)
all obligations which in accordance with GAAP would be shown as liabilities on a balance sheet of
such Person or which arise in connection with forward equity transactions; and (j) all obligations
of such Person owing under any synthetic lease, tax retention operating lease, off-balance sheet
loan or similar off-balance sheet financing product to which such Person is a party, where such
transaction is considered borrowed money indebtedness for tax purposes, but is classified as an
operating lease in accordance with GAAP. Debt of any Person shall include Debt of any partnership
or joint venture in which such Person is a general partner or joint venturer to the extent of such
Person’s pro rata share of the ownership of such partnership or joint venture (except if such Debt
is recourse to such Person, in which case the greater of such Person’s pro rata portion of such
Debt or the amount of the recourse portion of the Debt, shall be included as Debt of such Person).
All Loans and Letter of Credit Liabilities shall constitute Debt of the Borrower.



     “Default” means any of the events specified in Section 10.1., whether or not there has been
satisfied any requirement for the giving of notice, the lapse of time, or both.



     “Defaulting Lender” has the meaning set forth in Section 3.11.



     “Designated Lender” means a special purpose corporation which is sponsored by a Lender, that
is engaged in making, purchasing or otherwise investing in commercial loans in the ordinary course
of its business and that issues (or the parent of which issues) commercial paper



- 8 -









 







rated at least P-1 (or the then equivalent grade) by Moody’s or A-1 (or the then equivalent grade) by S&P and that, in
either case, (a) is organized under the laws of the United States of America or any state thereof,
(b) shall have become a party to this Agreement pursuant to Section 12.5.(e) and (c) is not
otherwise a Lender.



     “Designated Lender Note” means a Bid Rate Note of the Borrower evidencing the obligation of
the Borrower to repay Bid Rate Loans made by a Designated Lender.



     “Designating Lender” has the meaning given that term in Section 12.5.(e).



     “Designation Agreement” means a Designation Agreement between a Lender and a Designated Lender
and accepted by the Agent, substantially in the form of Exhibit B or such other form as may be
agreed to by such Lender, such Designated Lender and the Agent.



     “Development Property” means (i) a Property currently under development (or in the
pre-development phase) as a Multifamily Property and/or (ii) a Condominium Property.



     “Dollars” or “$” means the lawful currency of the United States of America.



     “Effective Date” means the later of: (a) the Agreement Date; and (b) the date on which all of
the conditions precedent set forth in Section 5.1. shall have been fulfilled or waived in writing
by the Requisite Lenders.



     “Eligible Assignee” means any Person who is, at the time of determination: (i) a Lender or an
Affiliate of a Lender; (ii) a commercial bank, trust, trust company, insurance company, investment
bank or pension fund organized under the laws of the United States of America, or any state
thereof, and having total assets in excess of $5,000,000,000; (iii) a savings and loan association
or savings bank organized under the laws of the United States of America, or any state thereof, and
having a tangible net worth of at least $500,000,000; or (iv) a commercial bank organized under the
laws of any other country which is a member of the Organization for Economic Cooperation and
Development, or a political subdivision of any such country, and having total assets in excess of
$10,000,000,000, provided that such bank is acting through a branch or agency located in the United
States of America. If such Person is not currently a Lender or an Affiliate of a Lender, such
Person’s senior unsecured long term indebtedness must be rated BBB or higher by S&P, Baa2 or higher
by Moody’s, or the equivalent or higher of either such rating by another rating agency acceptable
to the Agent. Notwithstanding the foregoing, during any period in which an Event of Default shall
exist under any of subsections (a), (b), (f) or (g) of Section 10.1., the term “Eligible Assignee”
shall mean any Person that is not an individual.



     “Environmental Laws” means any Applicable Law relating to environmental protection or the
manufacture, storage, disposal or clean-up of Hazardous Materials including, without limitation,
the following: Clean Air Act, 42 U.S.C. § 7401 et seq.; Federal Water Pollution Control Act, 33
U.S.C. § 1251 et seq.; Solid Waste Disposal Act, as amended by the Resource
Conservation and Recovery Act, 42 U.S.C. § 6901 et seq.; Comprehensive Environmental Response,
Compensation and Liability Act, 42 U.S.C. § 9601 et seq.; National Environmental Policy Act, 42
U.S.C. § 4321 et seq.; regulations of the Environmental Protection Agency and



- 9 -









 







any applicable rule of common law and any judicial interpretation thereof relating primarily to the environment or
Hazardous Materials.



     “Equity Interest” means, with respect to any Person, any share of capital stock of (or other
ownership or profit interests in) such Person, any warrant, option or other right for the purchase
or other acquisition from such Person of any share of capital stock of (or other ownership or
profit interests in) such Person, any security convertible into or exchangeable for any share of
capital stock of (or other ownership or profit interests in) such Person or warrant, right or
option for the purchase or other acquisition from such Person of such shares (or such other
interests), any operating partnership units in such Person and any other ownership or profit
interest in such Person (including, without limitation, partnership, member or trust interests
therein), whether voting or nonvoting, and whether or not such share, warrant, option, right or
other interest is authorized or otherwise existing on any date of determination.



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



     “ERISA Group” means the Borrower, any Subsidiary and all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under common control which,
together with the Borrower or any Subsidiary, are treated as a single employer under Section 414 of
the Internal Revenue Code.



     “Event of Default” means any of the events specified in Section 10.1., provided that any
requirement for notice or lapse of time or any other condition has been satisfied.



     “Excluded Subsidiary” means any Subsidiary (a) formed for the specific purpose of holding
title to assets which are collateral for any Consolidated Secured Debt of such Subsidiary; (b)
which is prohibited from Guarantying the Debt of any other Person pursuant to (i) any document,
instrument or agreement evidencing such Consolidated Secured Debt or (ii) a provision of such
Person’s organizational documents which provision was included in such Person’s organizational
documents as a condition to the extension of such Consolidated Secured Debt; and (c) for which none
of the Borrower, any Subsidiary (other than another Excluded Subsidiary) or any other Loan Party
has Guaranteed any of the Debt of such Subsidiary or has any direct obligation to maintain or
preserve such Subsidiary’s financial condition or to cause such Subsidiary to achieve any specified
levels of operating results, except for customary exceptions for fraud, misapplication of funds,
environmental indemnities, and other similar exceptions to recourse liability.



     “Existing Credit Agreement” has the meaning given that term in the first WHEREAS
clause of this Agreement.



     “Facility Fee” means the per annum percentage set forth in the table below corresponding to
the Level at which the “Applicable Margin” is determined in accordance with the definition thereof:



- 10 -









 





	 	 	 	 	 	 	 	 	 
	 	 	 	 	Borrower’s Credit Rating	 	 
	Level	 	(S&P/Moody’s)	 	Facility Fee
	 	1	 	 	A-/A3
	 	 	0.10	%
	 	2	 	 	BBB+/Baa1
	 	 	0.125	%
	 	3	 	 	BBB/Baa2
	 	 	0.15	%
	 	4	 	 	BBB-/Baa3
	 	 	0.175	%
	 	5	 	 	< BBB-/Baa3
	 	 	0.20	%





As of the Agreement Date, and thereafter until any change in Level as provided in the definition of
“Applicable Margin”, the Facility Fee equals 0.15%.




     “Federal Funds Rate” means, for any day, the rate per annum (rounded upward to the nearest
1/100th of 1%) equal to the weighted average of the rates on overnight Federal funds transactions
with members of the Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Business Day next succeeding such day,
provided that (a) if such day is not a Business Day, the Federal Funds Rate for such day shall be
such rate on such transactions on the next preceding Business Day, and (b) if no such rate is so
published on such next succeeding Business Day, the Federal Funds Rate for such day shall be the
average rate quoted to the Agent by federal funds dealers selected by the Agent on such day on such
transaction as determined by the Agent.



     “Fees” means the fees and commissions provided for or referred to in Section 3.6. and any
other fees payable by the Borrower hereunder or under any other Loan Document.



     “GAAP” means generally accepted accounting principles 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 majority of the accounting
profession, which are applicable to the circumstances as of the date of determination and applied
on a consistent basis.



     “Governmental Approvals” means all authorizations, consents, approvals, licenses and
exemptions of, registrations and filings with, and reports to, all Governmental Authorities.



     “Governmental Authority” means any national, state or local government (whether domestic or
foreign), any political subdivision thereof or any other governmental, quasi-governmental,
judicial, public or statutory instrumentality, authority, body, agency, bureau or entity
(including, without limitation, the Federal Deposit Insurance Corporation, the Comptroller of the
Currency or the Federal Reserve Board, any central bank or any comparable authority) or any
arbitrator with authority to bind a party at law.



     “Gross Asset Value” means from time to time the sum of the following amounts (without
duplication): (a) the product of (i) Consolidated Net Operating Income for the period of two
consecutive fiscal quarters most recently ended attributable to Multifamily Properties (excluding
any Properties covered by either of the immediately following clauses (b) or (c)) owned by any
member of the Consolidated Group for such period, multiplied by (ii) 2 and



- 11 -









 







divided by (iii) 6.75%; (b) the purchase price paid for any Multifamily Property acquired by any member of the Consolidated
Group during the period of six consecutive fiscal quarters most recently ended (less any amounts
paid as a purchase price adjustment, held in escrow, retained as a contingency reserve, or other
similar arrangements); (c)(i) the Condominium Property Value of all Condominium Properties owned by
any member of the Consolidated Group, (ii) the current book value of any other Development Property
(or Multifamily Property that was a Development Property at any time during the period of six
consecutive fiscal quarters most recently ended) owned by any member of the Consolidated Group and
(iii) the Renovation Property Value of all Renovation Properties owned by any member of the
Consolidated Group; (d) unrestricted cash and cash equivalents of the Consolidated Group; (e) the
value (based on the lower of cost or market price determined in accordance with GAAP) of any raw
land owned by any member of the Consolidated Group; (f) the value (based on the lower of cost or
market price determined in accordance with GAAP) of Properties owned by any member of the
Consolidated Group that are developed but that are not Multifamily Properties; (g) the value (based
on the lower of cost or market price determined in accordance with GAAP) of all Multifamily REIT
Preferred Interests; (h) the value (based on the lower of cost or market price determined in
accordance with GAAP) of (i) all promissory notes, including any secured by a Mortgage, payable
solely to any member of the Consolidated Group and the obligors of which are not Affiliates of the
Borrower (excluding any such note where the obligor is more than 60 days past due with respect to
any payment obligation) and (ii) all marketable securities (excluding Marketable Multifamily REIT
Preferred Interests); and (i) the Borrower’s pro rata share of the preceding items of any
Unconsolidated Affiliate of the Borrower to the extent not already included. Notwithstanding the
foregoing, any determination of Gross Asset Value shall exclude any Investments held by the
Borrower or any Subsidiary in excess of the amounts permitted under Section 9.4.



     “Gross Asset Value of the Unencumbered Pool” means Gross Asset Value determined with reference
only to Unencumbered Pool Assets. Notwithstanding the foregoing, the following amounts shall be
excluded from Gross Asset Value of the Unencumbered Pool: (a) the amount by which the value of
Unencumbered Pool Assets owned by Subsidiaries that are not Guarantors would, in the aggregate,
account for more that 10.0% of Gross Asset Value of the Unencumbered Pool; (b) the amount by which
the value of Unencumbered Pool Assets owned by Subsidiaries that are not Wholly Owned Subsidiaries
would, in the aggregate, account for more than 10.0% of Gross Asset Value of the Unencumbered Pool;
and (c) the amount by which the value of Unencumbered Pool Assets that are Investments and other
assets subject to the limitations of any of the subsections of Section 9.4. would, in the
aggregate, account for more than 10.0% of Gross Asset Value of the Unencumbered Pool; provided, the
limitations contained in the immediately preceding clauses (a) and (b) shall not apply to 1031
Properties and the limitations contained in the immediately preceding clause (c) shall not apply to
promissory notes secured by first Mortgages. The aggregate Occupancy Rate of Multifamily
Properties and other Properties that are developed, but that are not Multifamily Properties, must
exceed 80.0%.



     “Guarantor” means any Person that is a party to the Guaranty as a “Guarantor” and in any event
shall include each Material Subsidiary (unless an Excluded Subsidiary).



     “Guaranty”, “Guaranteed”, “Guarantying” or to “Guarantee” as applied to any obligation means
and includes: (a) a guaranty (other than by endorsement of negotiable



- 12 -









 







instruments for collection or deposit in the ordinary course of business), directly or indirectly, in any manner, of any part
or all of such obligation, or (b) an agreement, direct or indirect, contingent or otherwise, and
whether or not constituting a guaranty, the practical effect of which is to assure the payment or
performance (or payment of damages in the event of nonperformance) of any part or all of such
obligation whether by: (i) the purchase of securities or obligations, (ii) the purchase, sale or
lease (as lessee or lessor) of property or the purchase or sale of services primarily for the
purpose of enabling the obligor with respect to such obligation to make any payment or performance
(or payment of damages in the event of nonperformance) of or on account of any part or all of such
obligation, or to assure the owner of such obligation against loss, (iii) the supplying of funds to
or in any other manner investing in the obligor with respect to such obligation, (iv) repayment of
amounts drawn down by beneficiaries of letters of credit (including Letters of Credit), or (v) the
supplying of funds to or investing in a Person on account of all or any part of such Person’s
obligation under a Guaranty of any obligation or indemnifying or holding harmless, in any way, such
Person against any part or all of such obligation. As the context requires, “Guaranty” shall also
mean the Guaranty to which the Guarantors are parties substantially in the form of Exhibit O.



     “Hazardous Materials” means all or any of the following: (a) substances that are defined or
listed in, or otherwise classified pursuant to, any applicable Environmental Laws as “hazardous
substances”, “hazardous materials”, “hazardous wastes”, “toxic substances” or any other formulation
intended to define, list or classify substances by reason of deleterious properties such as
ignitability, corrosivity, reactivity, carcinogenicity, reproductive toxicity, “TCLP” toxicity or
“EP toxicity”; (b) oil, petroleum or petroleum derived substances, natural gas, natural gas liquids
or synthetic gas and drilling fluids, produced waters and other wastes associated with the
exploration, development or production of crude oil, natural gas or geothermal resources; (c) any
flammable substances or explosives or any radioactive materials; (d) asbestos in any form; (e)
toxic mold; and (f) electrical equipment which contains any oil or dielectric fluid containing
levels of polychlorinated biphenyls in excess of fifty parts per million.



     “Intangible Assets” of any Person means at any date the amount of (i) all write-ups (other
than write-ups resulting from write-ups of assets of a going concern business made within twelve
months after the acquisition of such business) in the book value of any asset owned by such Person
and (ii) all unamortized debt discount and expense, unamortized deferred charges, capitalized
start-up costs, goodwill, patents, licenses, trademarks, trade names, copyrights, organization or
developmental expenses, covenants not to compete and other intangible items.



     “Intellectual Property” has the meaning given that term in Section 6.1.(t).



     “Interest Period” means:



     (a) with respect to any LIBOR Loan, each period commencing on the date such
LIBOR Loan is made, or in the case of the Continuation of a LIBOR Loan the last day of the next
preceding Interest Period for such Loan, and ending 7 or 14 days (in either case, if available from
all Lenders), or 1, 2, 3, 4 or 6 months thereafter, as the Borrower may select in a Notice of
Borrowing, Notice of Continuation or Notice of Conversion, as the case may be, except that each
Interest Period having a duration of one month or more that commences on the last Business Day



- 13 -









 







of a calendar month, or on a day for which there is no corresponding day in the appropriate subsequent
calendar month, shall end on the last Business Day of the appropriate subsequent calendar month;
and



     (b) with respect to any Bid Rate Loan, the period commencing on the date such Bid Rate Loan is
made and ending on any Business Day not less than 7 nor more than 180 days thereafter, as the
Borrower may select as provided in Section 2.2.(b).



Notwithstanding the foregoing: (i) if any Interest Period would otherwise end after the Termination
Date, such Interest Period shall end on the Termination Date; and (ii) each Interest Period that
would otherwise end on a day which is not a Business Day shall end on the next Business Day (or in
the case of any Interest Period having a duration of one month or more, if the next Business Day
falls in the next calendar month, then on the immediately preceding Business Day).



     “Internal Revenue Code” means the Internal Revenue Code of 1986, as amended.



     “Investment” means, (a) with respect to any Person, any acquisition or investment (whether or
not of a controlling interest) by such Person, by means of any of the following: (i) the purchase
or other acquisition of any Equity Interest in another Person, (ii) a loan, advance or extension of
credit to, capital contribution to, Guaranty of Debt of, or purchase or other acquisition of any
Debt of, another Person, including any partnership or joint venture interest in such other Person,
or (iii) the purchase or other acquisition (in one transaction or a series of transactions) of
assets of another Person that constitute the business or a division or operating unit of another
Person and (b) with respect to any Property or other asset, the acquisition thereof. Any binding
commitment to make an Investment in any other Person, as well as any option of another Person to
require an Investment in such Person, shall constitute an Investment. Except as expressly provided
otherwise, for purposes of determining compliance with any covenant contained in a Loan Document,
the amount of any Investment shall be the amount actually invested, without adjustment for
subsequent increases or decreases in the value of such Investment.



     “Investment Grade Rating” means a Credit Rating of BBB-/Baa3 (or equivalent) or higher from
both Rating Agencies.



     “L/C Commitment Amount” equals $50,000,000.



     “Lender” means each financial institution from time to time party hereto as a “Lender” or a
“Designated Lender,” together with its respective successors and permitted assigns, and as the
context requires, includes the Swingline Lender; provided, however, that the term
“Lender” shall exclude each Designated Lender when used in reference to any Loan other than a Bid
Rate Loan, the Commitments or terms relating to any Loan other than a Bid Rate Loan and the Commitments
and shall further exclude each Designated Lender for all other purposes under the Loan Documents
except that any Designated Lender which funds a Bid Rate Loan shall, subject to Section 12.5.(e),
have the rights (including the rights given to a Lender contained in



- 14 -









 







Sections 12.2. and 12.9.) and obligations of a Lender associated with holding such Bid Rate Loan.



     “Lending Office” means, for each Lender and for each Type of Loan, the office of such Lender
specified as such in such Lender’s Administrative Details Form, or such other office of such Lender
as such Lender may notify the Agent in writing from time to time.



     “Letter of Credit” has the meaning given that term in Section 2.4.(a).



     “Letter of Credit Documents” means, with respect to any Letter of Credit, collectively, any
application therefor, any certificate or other document presented in connection with a drawing
under such Letter of Credit and any other agreement, instrument or other document governing or
providing for (a) the rights and obligations of the parties concerned or at risk with respect to
such Letter of Credit or (b) any collateral security for any of such obligations.



     “Letter of Credit Liabilities” means, without duplication, at any time and in respect of any
Letter of Credit, the sum of (a) the Stated Amount of such Letter of Credit plus (b) the aggregate
unpaid principal amount of all Reimbursement Obligations of the Borrower at such time due and
payable in respect of all drawings made under such Letter of Credit. For purposes of this
Agreement, a Lender (other than the Lender acting as the Agent) shall be deemed to hold a Letter of
Credit Liability in an amount equal to its participation interest in the related Letter of Credit
under Section 2.4.(i), and the Lender acting as the Agent shall be deemed to hold a Letter of
Credit Liability in an amount equal to its retained interest in the related Letter of Credit after
giving effect to the acquisition by the Lenders other than the Lender acting as the Agent of their
participation interests under such Section.



     “Level” has the meaning given that term in the definition of the term “Applicable Margin.”



     “LIBOR” means, for any LIBOR Loan or LIBOR Margin Loan for any Interest Period therefor, the
rate per annum (rounded upwards, if necessary, to the nearest 1/100 of 1%) appearing on Reuters
Screen LIBOR01 Page (or any successor page) as the London interbank offered rate for deposits in
Dollars at approximately 11:00 a.m. (London time) two Business Days prior to the first day of such
Interest Period for a term comparable to such Interest Period. If for any reason such rate is not
available, LIBOR shall be, for any Interest Period, the rate per annum reasonably determined by the
Agent as the rate of interest at which Dollar deposits in the approximate amount of the LIBOR Loan
comprising part of such borrowing or LIBOR Margin Loan would be offered by the Agent to major banks
in the London interbank Eurodollar market at their request at or about 11:00 a.m. (London time) two
Business Days prior to the first day of such Interest Period for a term comparable to such Interest
Period.



     “LIBOR Auction” means a solicitation of Bid Rate Quotes setting forth LIBOR Margin Loans based
on LIBOR pursuant to Section 2.2.



     “LIBOR Market Index Rate” means at any time the rate (rounded to the next higher 1/100 of 1%)
of interest for one month U.S. dollar deposits as reported on Reuters Screen



- 15 -









 







LIBOR01 Page (or any successor page) as of 11:00 a.m. London time for such day, provided, if such day is not a Business
Day, the immediately preceding Business Day, or if not so reported, then as determined by the Agent
from another recognized source or interbank quotation.



     “LIBOR Loan” means a Revolving Loan bearing interest at a rate based on LIBOR.



     “LIBOR Margin” has the meaning given that term in Section 2.2.(c)(ii)(D).



     “LIBOR Margin Loan” means a Bid Rate Loan the interest rate on which is determined on the
basis of LIBOR pursuant to a LIBOR Auction.



     “Lien” as applied to the property of any Person means: (a) any security interest,
encumbrance, mortgage, deed to secure debt, deed of trust, pledge, lien, charge or lease
constituting a Capitalized Lease Obligation, conditional sale or other title retention agreement,
or other security title or encumbrance of any kind in respect of any property of such Person, or
upon the income or profits therefrom; (b) any arrangement, under which any property of such Person
is transferred, sequestered or otherwise identified for the purpose of subjecting the same to the
payment of Debt or performance of any other obligation in priority to the payment of the general,
unsecured creditors of such Person; (c) the filing of any financing statement under the Uniform
Commercial Code or its equivalent in any jurisdiction, other than a financing statement filed (i)
in respect of a lease not constituting a Capitalized Lease Obligation pursuant to Section 9-505 (or
a successor provision) of the Uniform Commercial Code or its equivalent as in effect in an
applicable jurisdiction or (ii) in connection with a sale or other disposition of accounts or other
assets not prohibited by this Agreement in a transaction not otherwise constituting or giving rise
to a Lien; and (d) any then enforceable agreement by such Person to grant, give or otherwise convey
any of the foregoing.



     “Loan” means a Revolving Loan, a Bid Rate Loan or a Swingline Loan.



     “Loan Document” means this Agreement, each Note, each Letter of Credit Document, the Guaranty
and each other document or instrument now or hereafter executed and delivered by a Loan Party in
connection with, pursuant to or relating to this Agreement.



     “Loan Party” means each of the Borrower and each other Person who guarantees all or a portion
of the Obligations and/or who pledges any collateral security to secure all or a portion of the
Obligations. Schedule 1.1.(A) sets forth the Loan Parties in addition to the Borrower as of the
Agreement Date.



     “Mandatorily Redeemable Stock” means, with respect to any Person, any Equity Interest of such
Person which by the terms of such Equity Interest (or by the terms of any security into which it is
convertible or for which it is exchangeable or exercisable), upon the
happening of any event or otherwise (a) matures or is mandatorily redeemable, pursuant to a sinking
fund obligation or otherwise (other than an Equity Interest which is



- 16 -









 







redeemable solely in exchange for common stock or other equivalent common Equity Interests), (b) is convertible into or
exchangeable or exercisable for Debt or Mandatorily Redeemable Stock, or (c) is redeemable at the
option of the holder thereof, in whole or in part (other than an Equity Interest which is
redeemable solely in exchange for common stock or other equivalent common Equity Interests), in
each case on or prior to the date on which all Revolving Loans are scheduled to be due and payable
in full.



     “Marketable Multifamily REIT Preferred Interest” means a Multifamily REIT Preferred Interest
(a) having trading privileges on a national securities exchange or that is subject to price
quotations in the over-the-counter market and (b) not subject to restrictions on the sale,
transfer, assignment, hypothecation or other limitations, in each case where such restriction would
exceed 90 days from the time of purchase, that would (whether contractual or under Applicable Law)
otherwise prevent such Preferred Equity Interest from being freely transferable by such member of
the Consolidated Group; provided, however, that this limitation shall not apply to Preferred Equity
Interests that could be sold pursuant to an available exemption under the Securities Act.



     “Material Adverse Effect” means a materially adverse effect on (a) the business, assets,
liabilities, financial condition, or results of operations of the Borrower and its Subsidiaries
taken as a whole, (b) the ability of the Borrower or any other Loan Party to perform its
obligations under any Loan Document to which it is a party, (c) the validity or enforceability of
any of the Loan Documents, (d) the rights and remedies of the Lenders and the Agent under any of
the Loan Documents or (e) the timely payment of the principal of or interest on the Loans or other
amounts payable in connection therewith or the timely payment of all Reimbursement Obligations.



     “Material Contract” means any contract or other arrangement (other than Loan Documents),
whether written or oral, to which the Borrower, any Subsidiary or any other Loan Party is a party
as to which the breach, nonperformance, cancellation or failure to renew by any party thereto could
reasonably be expected to have a Material Adverse Effect.



     “Material Plan” means at any time a Plan or Plans having aggregate Unfunded Liabilities in
excess of $20,000,000.



     “Material Subsidiary” means any Subsidiary having assets equal to or greater than $20,000,000
in value.



     “Minority Interests” means any shares of stock (or other Equity Interests) of any class of a
Subsidiary (other than directors’ qualifying shares as required by law) that are not owned by the
Borrower and/or one or more Wholly Owned Subsidiaries. Minority Interests constituting Preferred
Equity Interests shall be valued at the voluntary or involuntary liquidation value of such
Preferred Equity Interests, whichever is greater, and by valuing common stock at the book value of
the capitalized surplus applicable thereto adjusted, if necessary, to reflect any changes
from the book value of such common stock required by the foregoing method of valuing Minority
Interests in Preferred Equity Interests.



     “Moody’s” means Moody’s Investors Service, Inc. and its successors.



- 17 -









 





     “Mortgage” means a mortgage, deed of trust, deed to secure debt or similar security instrument
made by a Person owning an interest in real property granting a Lien on such interest in real
property as security for the payment of Debt of such Person or another Person.



     “Multiemployer Plan” means at any time a multiemployer plan within the meaning of Section
4001(a)(3) of ERISA to which any member of the ERISA Group is then making or accruing an obligation
to make contributions or has within the preceding five plan years made contributions, including for
these purposes any Person which ceased to be a member of the ERISA Group during such five year
period.



     “Multifamily Property” means a Property on which the improvements consist primarily of an
apartment community.



     “Multifamily REIT Preferred Interest” means a Preferred Equity Interest: (a) owned by a member
of the Consolidated Group and (b) issued by a REIT that (i) is not a Subsidiary and (ii) owns
primarily apartment communities.



     “Negative Pledge” means a provision of any agreement (other than this Agreement or any other
Loan Document) that prohibits or limits the creation or assumption of any Lien on any assets of a
Person or entitles another Person to obtain or claim the benefit of a Lien on any assets of such
Person.



     “Nonrecourse Indebtedness” means, with respect to a Person, Debt for borrowed money in respect
of which recourse for payment (except for customary exceptions for fraud, misapplication of funds,
environmental indemnities, and other similar exceptions to nonrecourse liability (but not
exceptions relating to bankruptcy, insolvency, receivership or other similar events)) is
contractually limited to specific assets of such Person encumbered by a Lien securing such Debt.



     “Note” means a Revolving Note, a Bid Rate Note or a Swingline Note.



     “Notice of Borrowing” means a notice in the form of Exhibit C to be delivered to the Agent
pursuant to Section 2.1.(b) evidencing the Borrower’s request for a borrowing of Revolving Loans.



     “Notice of Continuation” means a notice in the form of Exhibit D to be delivered to the Agent
pursuant to Section 2.9. evidencing the Borrower’s request for the Continuation of a LIBOR Loan.



     “Notice of Conversion” means a notice in the form of Exhibit E to be delivered to the Agent
pursuant to Section 2.10. evidencing the Borrower’s request for the Conversion of a Loan from one
Type to another Type.



     “Notice of Swingline Borrowing” means a notice in the form of Exhibit F to be delivered to the
Agent pursuant to Section 2.3. evidencing the Borrower’s request for a Swingline Loan.



- 18 -









 





     “Obligations” means, individually and collectively: (a) the aggregate principal balance of,
and all accrued and unpaid interest on, all Loans; (b) all Reimbursement Obligations and all other
Letter of Credit Liabilities; and (c) all other indebtedness, liabilities, obligations, covenants
and duties of the Borrower and the other Loan Parties owing to the Agent or any Lender of every
kind, nature and description, under or in respect of this Agreement or any of the other Loan
Documents, including, without limitation, the Fees and indemnification obligations, whether direct
or indirect, absolute or contingent, due or not due, contractual or tortious, liquidated or
unliquidated, and whether or not evidenced by any promissory note.



     “Occupancy Rate” means, with respect to a Property at any time, the ratio, expressed as a
percentage, of (a) the number of rentable apartment units of such Property leased by tenants paying
rent at market rates pursuant to binding leases as to which no monetary default has occurred and is
continuing to (b) the aggregate number of rentable units of such Property.



     “OFAC” means U.S. Department of the Treasury’s Office of Foreign Assets Control and any
successor Governmental Authority.



     “Operating Partnership” means each of United Dominion Realty, L.P. and Heritage Communities
L.P., together with their respective successors and permitted assigns.



     “Participant” has the meaning given that term in Section 12.5.(c).



     “PBGC” means the Pension Benefit Guaranty Corporation and any successor agency.



     “Permitted Liens” means, as to any Person: (a) Liens securing taxes, assessments and other
charges or levies imposed by any Governmental Authority (excluding any Lien imposed pursuant to any
of the provisions of ERISA) or the claims of materialmen, mechanics, carriers, warehousemen or
landlords for labor, materials, supplies or rentals incurred in the ordinary course of business,
which are not at the time required to be paid or discharged under Section 7.6.; (b) Liens
consisting of deposits or pledges made, in the ordinary course of business, in connection with, or
to secure payment of, obligations under workers’ compensation, unemployment insurance or similar
Applicable Laws; (c) Liens consisting of encumbrances in the nature of zoning restrictions,
easements, and rights or restrictions of record on the use of real property, which do not
materially detract from the value of such property or impair the use thereof in the business of
such Person; and (d) Liens in existence as of the Agreement Date and set forth in Part II of
Schedule 6.1.(f).



     “Person” means an individual, corporation, partnership, limited liability company,
association, trust or unincorporated organization, or a government or any agency or political
subdivision thereof.



     “Plan” means at any time an employee pension benefit plan (other than a Multiemployer Plan)
which is covered by Title IV of ERISA or subject to the minimum funding standards under Section 412
of the Internal Revenue Code and either (a) is maintained, or contributed to, by any member of the
ERISA Group for employees of any member of the ERISA Group or (b) has at



- 19 -









 







any time within the preceding five years been maintained, or contributed to, by any Person which was at such time a
member of the ERISA Group for employees of any Person which was at such time a member of the ERISA
Group.



     “Post-Default Rate” means, in respect of any principal of any Loan or any other Obligation
that is not paid when due (whether at stated maturity, by acceleration, by optional or mandatory
prepayment or otherwise), a rate per annum equal to two percent (2.0%) plus the Base Rate as in
effect from time to time.



     “Preferred Equity Interests” means, with respect to any Person, Equity Interests in such
Person which are entitled to preference or priority over any other Equity Interest in such Person
in respect of the payment of dividends or distribution of assets upon liquidation or both.



     “Prime Rate” means the rate of interest per annum announced publicly by the Lender acting as
the Agent as its prime rate from time to time. The Prime Rate is not necessarily the best or the
lowest rate of interest offered by the Lender acting as the Agent or any other Lender.



     “Principal Office” means the address of the Agent specified in Section 12.1., or any
subsequent office which the Agent shall have specified by written notice to the Borrower and
Lenders as the Principal Office referred to herein, to which payments due are to be made and at
which Loans will be disbursed and Letters of Credit requested.



     “Property” means any parcel of real property owned or leased (in whole or in part) or operated
by the Borrower, any Subsidiary or any Unconsolidated Affiliate of the Borrower and which is
located in a state of the United States of America or the District of Columbia.



     “Rating Agencies” means S&P and Moody’s.



     “Register” has the meaning given that term in Section 12.5.(f).



     “Regulatory Change” means, with respect to any Lender, any change effective after the
Agreement Date in Applicable Law (including without limitation, Regulation D of the Board of
Governors of the Federal Reserve System) or the adoption or making after such date of any
interpretation, directive or request applying to a class of banks, including such Lender, of or
under any Applicable Law (whether or not having the force of law and whether or not failure to
comply therewith would be unlawful) by any Governmental Authority or monetary authority charged
with the interpretation or administration thereof or compliance by any Lender with any request or
directive regarding capital adequacy.



     “Reimbursement Obligation” means the absolute, unconditional and irrevocable obligation of the
Borrower to reimburse the Agent for any drawing honored by the Agent under a Letter of Credit.



     “REIT” means a Person qualifying for treatment as a “real estate investment trust” under the
Internal Revenue Code.




- 20 -










 





     “Renovation Property” mean a Property on which the existing building or other
improvements or a portion thereof are undergoing renovation and redevelopment that will either (a)
disrupt the occupancy of at least 30% of the square footage of such Property or (b) temporarily
reduce the Consolidated Net Operating Income attributable to such Property by more that 30% as
compared to the immediately preceding comparable prior period. A Property shall cease to be a
Renovation Property upon the earliest to occur of (i) all improvements (other than tenant
improvements on unoccupied space) related to the redevelopment of such Property having been
substantially completed and (ii) once such Property has achieved an Occupancy Rate of 80.0% or
more.



     “Renovation Property Value” means for a Renovation Property, the sum of the following: (a)
the Consolidated Net Operating Income attributable to such Property for the two quarter period
annualized ending immediately prior to the commencement of such renovation and redevelopment
divided by 6.75%, plus (b) the cost of capital improvements made to such Property in connection
with such renovation and redevelopment not to exceed 35% of the amount determined in accordance
with the preceding clause (a); provided, however, (i) the value of (a) plus (b) above does not
exceed 80% of the Borrower’s good faith determination of the pro forma Consolidated Net Operating
Income of such Renovation Property (assuming the completion of all applicable renovation and
redevelopment) divided by 6.75% and (ii) 18 months following the commencement of such renovation
and redevelopment such property will cease to be a Renovation Property.



     “Requisite Lenders” means, as of any date, Lenders having greater than 50% of the aggregate
amount of the Commitments (not held by Defaulting Lenders who are not entitled to vote), or, if the
Commitments have been terminated or reduced to zero, Lenders holding greater than 50% of the
principal amount of the aggregate outstanding Loans and Letter of Credit Liabilities (not held by
Defaulting Lenders who are not entitled to vote). For purposes of this definition, a Lender (other
than the Swingline Lender) shall be deemed to hold a Swingline Loan or a Letter of Credit Liability
to the extent such Lender has acquired a participation therein under the terms of this Agreement
and has not failed to perform its obligations in respect of such participation.



     “Responsible Officer” means the chief financial officer, the Controller, any Senior Vice
President or the Treasurer.



     “Restricted Payment” means: (a) any dividend or other distribution, direct or indirect, on
account of any Equity Interest of any member of the Consolidated Group now or hereafter
outstanding, except a dividend payable solely in Equity Interests of identical class to the holders
of that class; (b) any redemption, conversion, exchange, retirement, sinking fund or similar
payment, purchase or other acquisition for value, direct or indirect, of any Equity Interest of any
member of the Consolidated Group now or hereafter outstanding; and (c) any payment made to retire,
or to obtain the surrender of, any outstanding warrants, options or other rights to acquire any
Equity Interests of any member of the Consolidated Group now or hereafter outstanding.



- 21 -









 





     “Revolving Loan” means a loan made by a Lender to the Borrower pursuant to Section 2.1.(a).



     “Revolving Note” has the meaning given that term in Section 2.11.(a).



     “Sanctioned Entity” means (a) an agency of the government of, (b) an organization directly or
indirectly controlled by, or (c) a Person resident in, in each case, a country that is subject to a
sanctions program identified on the list maintained by the OFAC and published from time to time, as
such program may be applicable to such agency, organization or Person.



     “Sanctioned Person” means a Person named on the list of Specially Designated Nationals or
Blocked Persons maintained by the OFAC as published from time to time.



     “Secured Debt” means, with respect to a Person as of any given date, the aggregate principal
amount of all Debt of such Person outstanding at such date that is secured in any manner by any
Lien, and in the case of the Borrower, shall include (without duplication) the Borrower’s pro rata
share of the Secured Debt of its Unconsolidated Affiliates.



     “Securities Act” means the Securities Act of 1933, as amended from time to time, together with
all rules and regulations issued thereunder.



     “Solvent” means, when used with respect to any Person, that (a) the fair value and the fair
salable value of its assets (excluding any Debt due from any Affiliate of such Person) are each in
excess of the fair valuation of its total liabilities (including all contingent liabilities
computed at the amount which, in light of all the facts and circumstances existing at such time,
represents the amount that could reasonably be expected to become an actual and matured liability);
(b) such Person is able to pay its debts or other obligations in the ordinary course as they
mature; and (c) such Person has capital not unreasonably small to carry on its business and all
business in which it proposes to be engaged.



     “S&P” means Standard & Poor’s Rating Services, a division of The McGraw-Hill Companies, Inc.
and its successors.



     “Stated Amount” means the amount available to be drawn by a beneficiary under a Letter of
Credit from time to time, as such amount may be increased or reduced from time to time in
accordance with the terms of such Letter of Credit.



     “Subsidiary” means, for any Person, any corporation, partnership or other entity of which at
least a majority of the securities or other ownership interests having by the terms thereof
ordinary voting power to elect a majority of the board of directors or other persons performing
similar functions of such corporation, partnership or other entity (without regard to the
occurrence of any contingency) is at the time directly or indirectly owned or controlled by such
Person or one or more Subsidiaries of such Person or by such Person and one or more Subsidiaries of
such Person, and shall include all Persons the accounts of which consolidated with those of such
Person pursuant to GAAP.



- 22 -









 





     “Swingline Commitment” means the Swingline Lender’s obligation to make Swingline Loans
pursuant to Section 2.3. in an amount up to, but not exceeding, $50,000,000, as such amount may be
reduced from time to time in accordance with the terms hereof.



     “Swingline Lender” means Wachovia Bank, National Association, together with its successors and
assigns.



     “Swingline Loan” means a loan made by the Swingline Lender to the Borrower pursuant to Section
2.3.(a).



     “Swingline Note” means the promissory note of the Borrower payable to the order of the
Swingline Lender in a principal amount equal to the amount of the Swingline Commitment as
originally in effect and otherwise duly completed, substantially in the form of Exhibit G.



     “Taxes” has the meaning given that term in Section 3.12.



     “Termination Date” means July 26, 2012.



     “Titled Agents” means each of the Joint Lead Arrangers, the Joint Bookrunners, the Syndication
Agent, the Documentation Agents, and the Co-Agents, and their respective successors and permitted
assigns.



     “Type” with respect to any Revolving Loan, refers to whether such Loan is a LIBOR Loan or Base
Rate Loan.



     “Unconsolidated Affiliate” means, with respect to any Person, any other Person in whom such
Person holds an Investment, which Investment is accounted for in the financial statements of such
Person on an equity basis of accounting and whose financial results would not be consolidated under
GAAP with the financial results of such Person on the consolidated financial statements of such
Person.



     “Unencumbered Pool Asset” means any asset owned by a member of the Consolidated Group or an
Unconsolidated Affiliate of the Borrower and that satisfies all of the following requirements: (a)
such asset is either (i) a Multifamily Property, (ii) a Property that is developed but that is not
a Multifamily Property, (iii) a Development Property or a Renovation Property, (iv) raw land, (v)
promissory notes, (vi) marketable securities (including Marketable Multifamily REIT Preferred
Interests) or (vii) Multifamily REIT Preferred Interests; (b) neither such asset, nor any interest
of any member of the Consolidated Group or Unconsolidated Affiliate therein, is subject to any Lien
(other than Permitted Liens of the types described in clauses (a) through (c) of the definition
thereof) or to any Negative Pledge; (c) if such asset is owned by Person other than the Borrower
(i) none of the Borrower’s direct or indirect ownership interest in such Person is subject to any
Lien (other than Permitted Liens of the types described in clauses (a) through (c) of the
definition thereof) or to any Negative Pledge; and (ii) the Borrower directly, or indirectly
through a Subsidiary, has the right to take the following actions without the need to obtain the
consent of any Person: (x) sell, transfer or otherwise dispose of such asset and (y) to create a
Lien on such asset as security for Debt of the Borrower or a Guarantor, as applicable;



- 23 -









 




(d) if such asset is owned by a Subsidiary or Unconsolidated Affiliate which is not a Guarantor (i)
the Borrower directly, or indirectly through other Subsidiaries, owns at least 51.0% of all
outstanding Equity Interests of such Person; and (ii) such Person is not an obligor with respect to
any Debt (other than unsecured Debt of the type set forth in clauses (c) and (d) of the definition
of the term Debt); provided, however, 1031 Properties will not be subject to the limitations
contained in subclauses (i) and (ii) of this clause (d); and (e) in the case of a Property, such
Property is free of all structural defects or major architectural deficiencies (if developed),
title defects, environmental conditions or other adverse matters which, individually or
collectively, materially impair the value of such Property.




     “Unfunded Liabilities” means, with respect to any Plan at any time, the amount (if any) by
which (a) the value of all benefit liabilities under such Plan, determined on a plan termination
basis using the assumptions prescribed by the PBGC for purposes of Section 4044 of ERISA, exceeds
(b) the fair market value of all Plan assets allocable to such liabilities under Title IV of ERISA
(excluding any accrued but unpaid contributions), 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 a member of the ERISA Group to the PBGC or any other Person under Title IV of ERISA.



     “Wachovia” means Wachovia Bank, National Association together with its successors and assigns.



     “Wholly Owned Subsidiary” means any Subsidiary of a Person in respect of which all of the
equity securities or other ownership interests (other than, in the case of a corporation,
directors’ qualifying shares) are at the time directly or indirectly owned or controlled by such
Person or one or more other Subsidiaries of such Person or by such Person and one or more other
Subsidiaries of such Person.



Section 1.2. General; References to Times.




     Unless otherwise indicated, all accounting terms, ratios and measurements shall be interpreted
or determined in accordance with GAAP; provided that, if at any time any change in GAAP would
affect the computation of any financial ratio or requirement set forth in any Loan Document, and
either the Borrower or the Requisite Lenders shall so request, the Agent, the Lenders and the
Borrower shall negotiate in good faith to amend such ratio or requirement to preserve the original
intent thereof in light of such change in GAAP (subject to the approval of the Requisite Lenders);
provided further that, until so amended, (i) such ratio or requirement shall continue to be
computed in accordance with GAAP prior to such change therein and (ii) the Borrower shall provide
to the Agent and the Lenders financial statements and other documents required under this Agreement
or as reasonably requested hereunder setting forth a reconciliation between calculations of such
ratio or requirement made before and after giving effect to such change in GAAP. References in
this Agreement to “Sections”, “Articles”, “Exhibits” and “Schedules” are to sections, articles,
exhibits and schedules herein and hereto unless otherwise indicated. References in this Agreement
to any document, instrument or agreement (a) shall include all exhibits, schedules and other
attachments thereto, (b) shall include all documents, instruments or agreements issued or executed
in replacement thereof, to the extent permitted hereby and (c) shall mean such document, instrument
or agreement, or replacement or



- 24 -









 




predecessor thereto, as amended, supplemented, restated or otherwise modified as of the date of
this Agreement and from time to time thereafter to the extent not prohibited hereby and in effect
at any given time. Wherever from the context it appears appropriate, each term stated in either
the singular or plural shall include the singular and plural, and pronouns stated in the masculine,
feminine or neuter gender shall include the masculine, the feminine and the neuter. Unless
explicitly set forth to the contrary, a reference to “Subsidiary” means a Subsidiary of the
Borrower or a Subsidiary of such Subsidiary and a reference to an “Affiliate” means a reference to
an Affiliate of the Borrower. Titles and captions of Articles, Sections, subsections and clauses
in this Agreement are for convenience only, and neither limit nor amplify the provisions of this
Agreement. Unless otherwise indicated, all references to time are references to Charlotte, North
Carolina time.




Article II. Credit Facility




Section 2.1. Revolving Loans.




     (a) Generally. Subject to the terms and conditions hereof, during the period from the
Effective Date to but excluding the Termination Date, each Lender severally and not jointly agrees
to make Revolving Loans to the Borrower in an aggregate principal amount at any one time
outstanding up to, but not exceeding, the amount of such Lender’s Commitment. Subject to the terms
and conditions of this Agreement, during the period from the Effective Date to but excluding the
Termination Date, the Borrower may borrow, repay and reborrow Revolving Loans hereunder.



     (b) Requesting Revolving Loans. The Borrower shall give the Agent notice pursuant to
a Notice of Borrowing or telephonic notice of each borrowing of Revolving Loans. Each Notice of
Borrowing shall be delivered to the Agent before 11:00 a.m. (i) in the case of LIBOR Loans, on the
date three Business Days prior to the proposed date of such borrowing and (ii) in the case of Base
Rate Loans, on the date one Business Day prior to the proposed date of such borrowing. Any such
telephonic notice shall include all information to be specified in a written Notice of Borrowing
and shall be promptly confirmed in writing by the Borrower pursuant to a Notice of Borrowing sent
to the Agent by telecopy on the same day of the giving of such telephonic notice. The Agent will
transmit by telecopy the Notice of Borrowing (or the information contained in such Notice of
Borrowing) to each Lender promptly upon receipt by the Agent. Each Notice of Borrowing or
telephonic notice of each borrowing shall be irrevocable once given and binding on the Borrower.



     (c) Disbursements of Revolving Loan Proceeds. No later than 2:00 p.m. on the date
specified in the Notice of Borrowing, each Lender will make available for the account of its
applicable Lending Office to the Agent at the Principal Office, in immediately available funds, the
proceeds of the Revolving Loan to be made by such Lender. With respect to Revolving Loans to be
made after the Effective Date, unless the Agent shall have been notified by any Lender prior to the
specified date of borrowing that such Lender does not intend to make available to the Agent the
Revolving Loan to be made by such Lender on such date, the Agent may assume that such Lender will
make the proceeds of such Revolving Loan available to the Agent on the date of the requested
borrowing as set forth in the Notice of Borrowing and the Agent may (but shall not be obligated
to), in reliance upon such assumption, make available to



- 25 -









 




the Borrower the amount of such Revolving Loan to be provided by such Lender. Subject to
satisfaction of the applicable conditions set forth in Article V. for such borrowing, the Agent
will make the proceeds of such borrowing available to the Borrower no later than 4:00 p.m. on the
date and at the account specified by the Borrower in such Notice of Borrowing.




     (d) Repayment of Loans Outstanding under Existing Credit Agreement. The Borrower and
the Lenders agree that on the Effective Date all Loans (as defined in the Existing Credit
Agreement) outstanding under the Existing Credit Agreement shall be repaid with the proceeds of the
Loans to be made by the Lenders hereunder on the Effective Date.



Section 2.2. Bid Rate Loans.




     (a) Bid Rate Loans. So long as the Borrower maintains an Investment Grade Rating, in
addition to borrowings of Revolving Loans, at any time during the period from the Effective Date to
but excluding the Termination Date the Borrower may, as set forth in this Section, request the
Lenders to make offers to make Bid Rate Loans to the Borrower in Dollars. The Lenders may, but
shall have no obligation to, make such offers and the Borrower may, but shall have no obligation
to, accept any such offers in the manner set forth in this Section.



     (b) Requests for Bid Rate Loans. When the Borrower wishes to request from the Lenders
offers to make Bid Rate Loans, it shall give the Agent notice (a “Bid Rate Quote Request”) so as to
be received no later than 10:00 a.m. on (x) the Business Day immediately preceding the date of
borrowing proposed therein, in the case of an Absolute Rate Auction and (y) the date four Business
Days prior to the proposed date of borrowing, in the case of a LIBOR Auction. The Agent shall
deliver to each Lender a copy of each Bid Rate Quote Request promptly upon receipt thereof by the
Agent. The Borrower may request offers to make Bid Rate Loans for up to three (3) different
Interest Periods in each Bid Rate Quote Request; provided that the request for each separate
Interest Period shall be deemed to be a separate Bid Rate Quote Request for a separate borrowing (a
“Bid Rate Borrowing”). Each Bid Rate Quote Request shall be substantially in the form of Exhibit H
and shall specify as to each Bid Rate Borrowing:




     (i) the proposed date of such Bid Rate Borrowing, which shall be a Business Day;




     (ii) the aggregate amount of such Bid Rate Borrowing, which (x) shall be in the minimum
amount of $1,000,000 and integral multiples of $500,000 and (y) shall not cause any of the
limits specified in Section 2.14. to be violated;




     (iii) whether the Bid Rate Quote Request is for LIBOR Margin Loans or Absolute Rate
Loans; and




     (iv) the duration of the Interest Period applicable thereto, which shall not extend
beyond the Termination Date.


Except as otherwise provided in this subsection (b), no Bid Rate Quote Request shall be given
within five Business Days (or such other number of days as the Borrower and the Agent, with the
consent of the Requisite Lenders, may agree) of the giving of any other Bid Rate Quote Request.




- 26 -









 








     (c) Bid Rate Quotes.




     (i) Each Lender may submit one or more Bid Rate Quotes, each containing an offer to
make a Bid Rate Loan in response to any Bid Rate Quote Request; provided that, if the
Borrower’s request under Section 2.2.(b) specified more than one Interest Period, such
Lender may make a single submission containing one or more Bid Rate Quotes for each such
Interest Period. Each Bid Rate Quote must be submitted to the Agent not later than 10:00
a.m. (x) on the proposed date of borrowing, in the case of an Absolute Rate Auction and (y)
on the date three Business Days prior to the proposed date of borrowing, in the case of a
LIBOR Auction; provided that the Lender then acting as Agent may submit a Bid Rate Quote
only if it notifies the Borrower of the terms of the offer contained therein not later than
9:00 a.m. (x) on the proposed date of such borrowing, in the case of an Absolute Rate
Auction and (y) on the date three Business Days prior to the proposed date of borrowing, in
the case of a LIBOR Auction. Subject to Articles V. and X., any Bid Rate Quote so made
shall be irrevocable except with the consent of the Agent given at the request of the
Borrower. Any Bid Rate Loan may be funded by a Lender’s Designated Lender (if any) as
provided in Section 12.5.(e), however such Lender shall not be required to specify in its
Bid Rate Quote whether such Bid Rate Loan will be funded by such Designated Lender.




     (ii) Each Bid Rate Quote shall be substantially in the form of Exhibit I and shall
specify:




          (A) the proposed date of borrowing and the Interest Period therefor;




          (B) the principal amount of the Bid Rate Loan for which each such offer is
being made; provided that the aggregate principal amount of all Bid Rate Loans for
which a Lender submits Bid Rate Quotes (x) may be greater or less than the
Commitment of such Lender but (y) shall not exceed the principal amount of the Bid
Rate Borrowing for a particular Interest Period for which offers were requested;




          (C) in the case of an Absolute Rate Auction, the rate of interest per annum
(rounded upwards, if necessary, to the nearest 1/10,000th of 1%) offered for each
such Bid Rate Loan (the “Absolute Rate”);




          (D) in the case of a LIBOR Auction, the margin above or below applicable LIBOR
(the “LIBOR Margin”) offered for each such LIBOR Margin Loan, expressed as a
percentage (rounded upwards, if necessary, to the nearest 1/1,000th of 1%) to be
added to (or subtracted from) the applicable LIBOR; and




          (E) the identity of the quoting Lender.




Unless otherwise agreed by the Agent and the Borrower, no Bid Rate Quote shall contain
qualifying, conditional or similar language or propose terms other than or in addition to



- 27 -









 






those set forth in the applicable Bid Rate Quote Request and, in particular, no Bid Rate
Quote may be conditioned upon acceptance by the Borrower of all (or some specified minimum)
of the principal amount of the Bid Rate Loan for which such Bid Rate Quote is being made.



     (d) Notification by Agent. The Agent shall, as promptly as practicable after the Bid
Rate Quotes are submitted (but in any event not later than 10:30 a.m. on the proposed date of
borrowing in the case of an Absolute Rate Auction, or on the date three Business Days prior to the
proposed date of borrowing, in the case of a LIBOR Auction), notify the Borrower of the terms (i)
of any Bid Rate Quote submitted by a Lender that is in accordance with Section 2.2.(c) and (ii) of
any Bid Rate Quote that amends, modifies or is otherwise inconsistent with a previous Bid Rate
Quote submitted by such Lender with respect to the same Bid Rate Quote Request. Any such
subsequent Bid Rate Quote shall be disregarded by the Agent unless such subsequent Bid Rate Quote
is submitted solely to correct a manifest error in such former Bid Rate Quote. The Agent’s notice
to the Borrower shall specify (A) the aggregate principal amount of the Bid Rate Borrowing for
which offers have been received and (B) the principal amounts and Absolute Rates or LIBOR Margins,
as applicable, so offered by each Lender (identifying the Lender that made each Bid Rate Quote).



     (e) Acceptance by Borrower.




     (i) Not later than 11:00 a.m. (x) on the proposed date of borrowing, in the case of an
Absolute Rate Auction and (y) on the date three Business Days prior to the proposed date of
borrowing, in the case of a LIBOR Auction, the Borrower shall notify the Agent of its
acceptance or nonacceptance of the Bid Rate Quotes so notified to it pursuant to Section
2.2.(d) which notice shall be in the form of Exhibit J. In the case of acceptance, such
notice shall specify the aggregate principal amount of Bid Rate Quotes for each Interest
Period that are accepted. The failure of the Borrower to give such notice by such time
shall constitute nonacceptance. The Agent shall promptly notify each affected Lender. The
Borrower may accept any Bid Rate Quote in whole or in part; provided that:




     (A) the aggregate principal amount of each Bid Rate Borrowing may not exceed
the applicable amount set forth in the related Bid Rate Quote Request;




     (B) the aggregate principal amount of each Bid Rate Borrowing shall comply with
the provisions of Section 3.5. but shall not cause the limits specified in Section
2.14. to be violated;




     (C) acceptance of Bid Rate Quotes may be made only in ascending order of
Absolute Rates or LIBOR Margins, as applicable, in each case beginning with the
lowest rate so offered;




     (D) the Borrower may not accept any Bid Rate Quote that fails to comply with
Section 2.2.(c) or otherwise fails to comply with the requirements of this
Agreement); and



- 28 -









 






     (E) any acceptance in part shall be in a minimum amount of $1,000,000 and
integral multiples of $500,000 in excess thereof.




     (ii) If Bid Rate Quotes are made by two or more Lenders with the same Absolute Rates or
LIBOR Margins, as applicable, for a greater aggregate principal amount than the amount in
respect of which Bid Rate Quotes are permitted to be accepted for the related Interest
Period, the principal amount of Bid Rate Loans in respect of which such Bid Rate Quotes are
accepted shall be allocated by the Agent among such Lenders in proportion to the aggregate
principal amount of such Bid Rate Quotes. Determinations by the Agent of the amounts of Bid
Rate Loans shall be conclusive in the absence of manifest error.



     (f) Obligation to Make Bid Rate Loans. The Agent shall promptly (and in any event not
later than (x) 12:00 noon on the proposed date of borrowing of Absolute Rate Loans and (y) on the
date three Business Days prior to the proposed date of borrowing of LIBOR Margin Loans) notify each
Lender whose Bid Rate Quote has been accepted and the amount and rate thereof. In addition, the
Agent shall promptly notify each Lender submitting a Bid Rate Quote of the range of Bid Rate Quotes
accepted. A Lender who is notified that it has been selected to make a Bid Rate Loan may designate
its Designated Lender (if any) to fund such Bid Rate Loan on its behalf, as described in Section
12.5.(e). Any Designated Lender which funds a Bid Rate Loan shall on and after the time of such
funding become the obligee under such Bid Rate Loan and be entitled to receive payment thereof when
due. No Lender shall be relieved of its obligation to fund a Bid Rate Loan, and no Designated
Lender shall assume such obligation, prior to the time the applicable Bid Rate Loan is funded. Any
Lender whose offer to make any Bid Rate Loan has been accepted shall, not later than 1:30 p.m. on
the date specified for the making of such Loan, make the amount of such Loan available to the Agent
at its Principal Office in immediately available funds, for the account of the Borrower. The
amount so received by the Agent shall, subject to the terms and conditions of this Agreement, be
made available to the Borrower no later than 2:00 p.m. on such date by depositing the same, in
immediately available funds, in an account of the Borrower designated by the Borrower.



     (g) No Effect on Commitment. Except for the purpose and to the extent expressly
stated in Sections 2.12. and 2.14., the amount of any Bid Rate Loan made by any Lender shall not
constitute a utilization of such Lender’s Commitment.



- 29 -









 





Section 2.3. Swingline Loans.




     (a) Swingline Loans. Subject to the terms and conditions hereof, during the period
from the Effective Date to but excluding the Termination Date, the Swingline Lender agrees to make
Swingline Loans to the Borrower in an aggregate principal amount at any one time outstanding up to,
but not exceeding, the amount of the Swingline Commitment. If at any time the aggregate principal
amount of the Swingline Loans outstanding at such time exceeds the Swingline Commitment in effect
at such time, the Borrower shall immediately pay the Agent for the account of the Swingline Lender
the amount of such excess. Subject to the terms and conditions of this Agreement, the Borrower may
borrow, repay and reborrow Swingline Loans hereunder.



     (b) Procedure for Borrowing Swingline Loans. The Borrower shall give the Agent and
the Swingline Lender notice pursuant to a Notice of Swingline Borrowing or telephonic notice of
each borrowing of a Swingline Loan. Each Notice of Swingline Borrowing shall be delivered to the
Swingline Lender no later than 1:00 p.m. on the proposed date of such borrowing. Any such notice
given telephonically shall include all information to be specified in a written Notice of Swingline
Borrowing and shall be promptly confirmed in writing by the Borrower pursuant to a Notice of
Swingline Borrowing sent to the Swingline Lender by telecopy on the same day of the giving of such
telephonic notice. On the date of the requested Swingline Loan and subject to satisfaction of the
applicable conditions set forth in Article V. for such borrowing, the Swingline Lender will make
the proceeds of such Swingline Loan available to the Borrower in Dollars, in immediately available
funds, at the account specified by the Borrower in the Notice of Swingline Borrowing not later than
4:00 p.m. on such date.



     (c) Interest. Swingline Loans shall bear interest at a per annum rate equal to the
LIBOR Market Index Rate plus the Applicable Margin for LIBOR Loans plus the
applicable Facility Fee (or at such other rate or rates as the Borrower and the Swingline Lender
may agree from time to time in writing). Interest payable on Swingline Loans is solely for the
account of the Swingline Lender. All accrued and unpaid interest on Swingline Loans shall be
payable on the dates and in the manner provided in Section 2.5. with respect to interest on Base
Rate Loans (except as the Swingline Lender and the Borrower may otherwise agree in writing in
connection with any particular Swingline Loan).



     (d) Swingline Loan Amounts, Etc. Each Swingline Loan shall be in the minimum amount
of $1,000,000 and integral multiples of $500,000 or such other minimum amounts agreed to by the
Swingline Lender and the Borrower. Any voluntary prepayment of a Swingline Loan must be in
integral multiples of $100,000 or the aggregate principal amount of all outstanding Swingline Loans
(or such other minimum amounts upon which the Swingline Lender and the Borrower may agree) and in
connection with any such prepayment, the Borrower must give the Swingline Lender prior written
notice thereof no later than 1:00 p.m. on the date of such prepayment. The Swingline Loans shall,
in addition to this Agreement, be evidenced by the Swingline Note.



     (e) Repayment and Participations of Swingline Loans. The Borrower agrees to repay
each Swingline Loan within one Business Day of demand therefor by the Swingline Lender and in any
event, within 30 Business Days after the date such Swingline Loan was made.



- 30 -









 




Notwithstanding the foregoing, the Borrower shall repay the entire outstanding principal amount of,
and all accrued but unpaid interest on, the Swingline Loans on the Termination Date (or such
earlier date as the Swingline Lender and the Borrower may agree in writing). In lieu of demanding
repayment of any outstanding Swingline Loan from the Borrower, the Swingline Lender may, on behalf
of the Borrower (which hereby irrevocably directs the Swingline Lender to act on its behalf),
request a borrowing of Base Rate Loans from the Lenders in an amount equal to the principal balance
of such Swingline Loan. The amount limitations of Section 3.5.(a) shall not apply to any borrowing
of Base Rate Loans made pursuant to this subsection. The Swingline Lender shall give notice to the
Agent of any such borrowing of Base Rate Loans not later than 12:00 noon on the proposed date of
such borrowing and the Agent shall give prompt notice of such borrowing to the Lenders and the
Borrower. No later than 3:00 p.m. on such date, each Lender will make available to the Agent at
the Principal Office for the account of Swingline Lender in immediately available funds, the
proceeds of the Base Rate Loan to be made by such Lender and, to the extent of such Base Rate Loan,
such Lender’s participation in the Swingline Loan so repaid shall be deemed to be funded by such
Base Rate Loan. The Agent shall pay the proceeds of such Base Rate Loans to the Swingline Lender,
which shall apply such proceeds to repay such Swingline Loan. At the time each Swingline Loan is
made, each Lender shall automatically (and without any further notice or action) be deemed to have
purchased from the Swingline Lender, without recourse or warranty, an undivided interest and
participation to the extent of such Lender’s Commitment Percentage in such Swingline Loan. If the
Lenders are prohibited from making Loans required to be made under this subsection for any reason,
including without limitation, the occurrence of any Default or Event of Default described in
Sections 10.1.(f) or 10.1.(g), each Lender severally agrees to pay to the Agent for the account of
the Swingline Lender in respect of such participation the amount of such Lender’s Commitment
Percentage of each outstanding Swingline Loan. If such amount is not in fact made available to the
Swingline Lender by any Lender, the Swingline Lender shall be entitled to recover such amount on
demand from such Lender, together with accrued interest thereon for each day from the date of
demand thereof, at the Federal Funds Rate. If such Lender does not pay such amount forthwith upon
the Swingline Lender’s demand therefor, and until such time as such Lender makes the required
payment, the Swingline Lender shall be deemed to continue to have outstanding Swingline Loans in
the amount of such unpaid participation obligation for all purposes of the Loan Documents (other
than those provisions requiring the other Lenders to purchase a participation therein). Further,
such Lender shall be deemed to have assigned any and all payments made of principal and interest on
its Loans, and any other amounts due to it hereunder, to the Swingline Lender to fund Swingline
Loans in the amount of the participation in Swingline Loans that such Lender failed to purchase
pursuant to this Section until such amount has been purchased (as a result of such assignment or
otherwise). A Lender’s obligation to make payments in respect of a participation in a Swingline
Loan shall be absolute and unconditional and shall not be affected by any circumstance whatsoever,
including without limitation, (i) any claim of setoff, counterclaim, recoupment, defense or other
right which such Lender or any other Person may have or claim against the Agent, the Swingline
Lender or any other Person whatsoever, (ii) the occurrence or continuation of a Default or Event of
Default (including without limitation, any of the Defaults or Events of Default described in
Sections 10.1.(f) or 10.1.(g)) or the termination of any Lender’s Commitment, (iii) the existence
(or alleged existence) of an event or condition which has had or could have a Material Adverse
Effect, (iv) any breach of any Loan Document by the Agent, any Lender or the Borrower or (v) any




- 31 -









 







other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing.




Section 2.4. Letters of Credit.




     (a) Letters of Credit. Subject to the terms and conditions of this Agreement, the
Agent, on behalf of the Lenders, agrees to issue for the account of the Borrower during the period
from and including the Effective Date to, but excluding, the date 30 days prior to the Termination
Date one or more letters of credit (each a “Letter of Credit”) up to a maximum aggregate Stated
Amount at any one time outstanding not to exceed the L/C Commitment Amount.



     (b) Terms of Letters of Credit. At the time of issuance, the amount, form, terms and
conditions of each Letter of Credit, and of any drafts or acceptances thereunder, shall be subject
to approval by the Agent and the Borrower. Notwithstanding the foregoing, in no event may the
expiration date of any Letter of Credit extend beyond the earlier of (i) the date one year from its
date of issuance or (ii) the Termination Date; provided, however, a Letter of Credit may contain a
provision providing for the automatic extension of the expiration date in the absence of a notice
of non-renewal from the Agent but in no event shall any such provision permit the extension of the
expiration date of such Letter of Credit beyond the Termination Date; provided, further, that a
Letter of Credit that contains an automatic extension provision may provide for an extension of its
expiration date to a date not more than one year beyond the Termination Date so long as the
Borrower delivers to the Agent for the benefit of the Lenders no later than 20 days prior to the
Termination Date (A) either (1) cash collateral for such Letter of Credit on terms acceptable to
the Agent, (2) a backup letter of credit having terms acceptable to the Agent and issued by a
domestic financial institution having a rating assigned by a Rating Agency to its senior unsecured
long term indebtedness of AA/Aa2 or (3) other collateral satisfactory to the Agent and all of the
Lenders and (B) a reimbursement agreement in form and substance acceptable to the Agent and such
other documents requested by the Agent evidencing the Borrower’s reimbursement obligations in
respect of such Letter of Credit.



     (c) Requests for Issuance of Letters of Credit. The Borrower shall give the Agent
written notice (or telephonic notice promptly confirmed in writing) at least 5 Business Days prior
to the requested date of issuance of a Letter of Credit, such notice to describe in reasonable
detail the proposed terms of such Letter of Credit and the nature of the transactions or
obligations proposed to be supported by such Letter of Credit, and in any event shall set forth
with respect to such Letter of Credit the proposed (i) Stated Amount, (ii) the beneficiary, and
(iii) the expiration date. The Borrower shall also execute and deliver such customary letter of
credit application forms as requested from time to time by the Agent. Provided the Borrower has
given the notice prescribed by the first sentence of this subsection and subject to the other terms
and conditions of this Agreement, including the satisfaction of any applicable conditions precedent
set forth in Article V., the Agent shall issue the requested Letter of Credit on the requested date
of issuance for the benefit of the stipulated beneficiary. The Agent shall not at any time be
obligated to issue any Letter of Credit if such issuance would conflict with, or cause the Agent or
any Lender to exceed any limits imposed by, any Applicable Law. References herein to “issue” and
derivations thereof with respect to Letters of Credit shall also include extensions or
modifications of any outstanding Letters of Credit, unless the context otherwise requires. Upon
the written request of



- 32 -









 




the Borrower, the Agent shall deliver to the Borrower a copy of each issued Letter of Credit within
a reasonable time after the date of issuance thereof. To the extent any term of a Letter of Credit
Document is inconsistent with a term of any Loan Document, the term of such Loan Document shall
control.




     (d) Reimbursement Obligations. Upon receipt by the Agent from the beneficiary of a
Letter of Credit of any demand for payment under such Letter of Credit, the Agent shall promptly
notify the Borrower of the amount to be paid by the Agent as a result of such demand and the date
on which payment is to be made by the Agent to such beneficiary in respect of such demand;
provided, however, the Agent’s failure to give, or delay in giving, such notice
shall not discharge the Borrower in any respect from the applicable Reimbursement Obligation up to
the Stated Amount of such Letter of Credit. The Borrower hereby unconditionally and irrevocably
agrees to pay and reimburse the Agent for the amount of each demand for payment under such Letter
of Credit up to the Stated Amount of such Letter of Credit on or prior to the date on which payment
is to be made by the Agent to the beneficiary thereunder, without presentment, demand, protest or
other formalities of any kind (other than notice as provided in this subsection). Upon receipt by
the Agent of any payment in respect of any Reimbursement Obligation, the Agent shall promptly pay
to each Lender that has acquired a participation therein under the second sentence of Section
2.4.(i) such Lender’s Commitment Percentage of such payment.



     (e) Manner of Reimbursement. Upon its receipt of a notice referred to in the
immediately preceding subsection (d), the Borrower shall advise the Agent whether or not the
Borrower intends to borrow hereunder to finance its obligation to reimburse the Agent for the
amount of the related demand for payment and, if it does, the Borrower shall submit a timely
request for such borrowing as provided in the applicable provisions of this Agreement. If the
Borrower fails to so advise the Agent, or if the Borrower fails to reimburse the Agent for a demand
for payment under a Letter of Credit by the date of such payment, then (i) if the applicable
conditions contained in Article V. would permit the making of Revolving Loans, the Borrower shall
be deemed to have requested a borrowing of Revolving Loans (which shall be Base Rate Loans) in an
amount equal to the unpaid Reimbursement Obligation and the Agent shall give each Lender prompt
notice of the amount of the Revolving Loan to be made available to the Agent not later than 1:00
p.m. and (ii) if such conditions would not permit the making of Revolving Loans, the provisions of
subsection (j) of this Section shall apply. The limitations of Section 3.5.(a) shall not apply to
any borrowing of Base Rate Loans under this subsection.



     (f) Effect of Letters of Credit on Commitments. Upon the issuance by the Agent of any
Letter of Credit and until such Letter of Credit shall have expired or been terminated, the
Commitment of each Lender shall be deemed to be utilized for all purposes of this Agreement in an
amount equal to the product of (i) such Lender’s Commitment Percentage and (ii) the sum of (A) the
Stated Amount of such Letter of Credit plus (B) any related Reimbursement Obligations then
outstanding.



     (g) Agent’s Duties Regarding Letters of Credit; Unconditional Nature of Reimbursement
Obligations. In examining documents presented in connection with drawings under Letters of
Credit and making payments under such Letters of Credit against such documents, the Agent shall
only be required to use the same standard of care as it uses in



- 33 -









 




connection with examining documents presented in connection with drawings under letters of credit
in which it has not sold participations and making payments under such letters of credit. The
Borrower assumes all risks of the acts and omissions of, or misuse of the Letters of Credit by, the
respective beneficiaries of such Letters of Credit. In furtherance and not in limitation of the
foregoing, neither the Agent nor any of the Lenders shall be responsible for (i) the form,
validity, sufficiency, accuracy, genuineness or legal effects of any document submitted by any
party in connection with the application for and issuance of or any drawing honored under any
Letter of Credit even if it should in fact prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent or forged; (ii) the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign any Letter of Credit, or the rights
or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or
ineffective for any reason; (iii) failure of the beneficiary of any Letter of Credit to comply
fully with conditions required in order to draw upon such Letter of Credit; (iv) errors, omissions,
interruptions or delays in transmission or delivery of any messages, by mail, cable, telex,
telecopy or otherwise, whether or not they be in cipher; (v) errors in interpretation of technical
terms; (vi) any loss or delay in the transmission or otherwise of any document required in order to
make a drawing under any Letter of Credit, or of the proceeds thereof; (vii) the misapplication by
the beneficiary of any Letter of Credit, or the proceeds of any drawing under any Letter of Credit;
or (viii) any consequences arising from causes beyond the control of the Agent or the Lenders.
None of the above shall affect, impair or prevent the vesting of any of the Agent’s or any Lender’s
rights or powers hereunder. Any action taken or omitted to be taken by the Agent under or in
connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or
willful misconduct, shall not create against the Agent or any Lender any liability to the Borrower
or any Lender. In this connection, the obligation of the Borrower to reimburse the Agent for any
drawing made under any Letter of Credit shall be absolute, unconditional and irrevocable and shall
be paid strictly in accordance with the terms of this Agreement and any other applicable Letter of
Credit Document under all circumstances whatsoever, including without limitation, the following
circumstances: (A) any lack of validity or enforceability of any Letter of Credit Document or any
term or provisions therein; (B) any amendment or waiver of or any consent to departure from all or
any of the Letter of Credit Documents; (C) the existence of any claim, setoff, defense or other
right which the Borrower may have at any time against the Agent, any Lender, any beneficiary of a
Letter of Credit or any other Person, whether in connection with this Agreement, the transactions
contemplated hereby or in the Letter of Credit Documents or any unrelated transaction; (D) any
breach of contract or dispute between the Borrower, the Agent, any Lender or any other Person; (E)
any demand, statement or any other document presented under a Letter of Credit proving to be
forged, fraudulent, invalid or insufficient in any respect or any statement therein or made in
connection therewith being untrue or inaccurate in any respect whatsoever; (F) any non-application
or misapplication by the beneficiary of a Letter of Credit of the proceeds of any drawing under
such Letter of Credit; (G) payment by the Agent under any Letter of Credit against presentation of
a draft or certificate which does not strictly comply with the terms of such Letter of Credit; and
(H) any other act, omission to act, delay or circumstance whatsoever that might, but for the
provisions of this Section, constitute a legal or equitable defense to or discharge of the
Borrower’s Reimbursement Obligations. Notwithstanding anything to the contrary contained in this
Section or Section 12.9., but not in limitation of the Borrower’s unconditional obligation to
reimburse the Agent for any drawing made under a Letter of Credit as provided in this Section, the
Borrower shall have no


- 34 -









 







obligation to indemnify the Agent or any Lender in respect of any liability incurred by the Agent
or a Lender arising solely out of the gross negligence or willful misconduct of the Agent or a
Lender in respect of a Letter of Credit as actually and finally determined by a court of competent
jurisdiction. Except as otherwise provided in this Section, nothing in this Section shall affect
any rights the Borrower may have with respect to the gross negligence or willful misconduct of the
Agent or any Lender with respect to any Letter of Credit.




     (h) Amendments, Etc. The issuance by the Agent of any amendment, supplement or other
modification to any Letter of Credit shall be subject to the same conditions applicable under this
Agreement to the issuance of new Letters of Credit (including, without limitation, that the request
therefor be made through the Agent), and no such amendment, supplement or other modification shall
be issued unless either (i) the respective Letter of Credit affected thereby would have complied
with such conditions had it originally been issued hereunder in such amended, supplemented or
modified form or (ii) the Requisite Lenders (or such other number of Lenders as is required by
Section 12.6.) shall have consented thereto. In connection with any such amendment, supplement or
other modification, the Borrower shall pay the Fees, if any, payable under the last sentence of
Section 3.6.(b).



     (i) Lenders’ Participation in Letters of Credit. Immediately upon the issuance by the
Agent of any Letter of Credit each Lender shall be deemed to have irrevocably and unconditionally
purchased and received from the Agent, without recourse or warranty, an undivided interest and
participation to the extent of such Lender’s Commitment Percentage of the liability of the Agent
with respect to such Letter of Credit and each Lender thereby shall absolutely, unconditionally and
irrevocably assume, as primary obligor and not as surety, and shall be unconditionally obligated to
the Agent to pay and discharge when due, such Lender’s Commitment Percentage of the Agent’s
liability under such Letter of Credit. In addition, upon the making of each payment by a Lender to
the Agent in respect of any Letter of Credit pursuant to the immediately following subsection (j),
such Lender shall, automatically and without any further action on the part of the Agent or such
Lender, acquire (i) a participation in an amount equal to such payment in the Reimbursement
Obligation owing to the Agent by the Borrower in respect of such Letter of Credit and (ii) a
participation in a percentage equal to such Lender’s Commitment Percentage in any interest or other
amounts payable by the Borrower in respect of such Reimbursement Obligation (other than the Fees
payable to the Agent pursuant to the third and last sentences of Section 3.6.(b)).



     (j) Payment Obligation of Lenders. Each Lender severally agrees to pay to the Agent
on demand in immediately available funds in Dollars the amount of such Lender’s Commitment
Percentage of each drawing paid by the Agent under each Letter of Credit to the extent such amount
is not reimbursed by the Borrower pursuant to Section 2.4.(d); provided, however, that in respect
of any drawing under any Letter of Credit, the maximum amount that any Lender shall be required to
fund, whether as a Revolving Loan or as a participation, shall not exceed such Lender’s Commitment
Percentage of such drawing. If the notice referenced in the second sentence of Section 2.4.(e) is
received by a Lender not later than 11:00 a.m., then such Lender shall make such payment available
to the Agent not later than 2:00 p.m. on the date of demand therefore; otherwise, such payment
shall be made available to the Agent not later than 1:00 p.m. on the next succeeding Business Day.
Each such Lender’s obligation to make such payments to



- 35 -









 




the Agent under this subsection, and the Agent’s right to receive the same, shall be absolute,
irrevocable and unconditional and shall not be affected in any way by any circumstance whatsoever,
including without limitation, (i) the failure of any other Lender to make its payment under this
subsection, (ii) the financial condition of the Borrower or any other Loan Party, (iii) the
existence of any Default or Event of Default, including any Event of Default described in Section
10.1.(f) or 10.1.(g) or (iv) the termination of the Commitments. Each such payment to the Agent
shall be made without any offset, abatement, withholding or deduction whatsoever.




     (k) Information to Lenders. Upon the request of any Lender from time to time, the
Agent shall deliver to such Lender information reasonably requested by such Lender with respect to
each Letter of Credit then outstanding. Other than as set forth in this subsection, the Agent
shall have no duty to notify the Lenders regarding the issuance or other matters regarding Letters
of Credit issued hereunder. The failure of the Agent to perform its requirements under this
subsection shall not relieve any Lender from its obligations under Section 2.4.(j).



Section 2.5. Rates and Payment of Interest on Loans.




     (a) Rates. The Borrower promises to pay to the Agent for the account of each Lender
interest on the unpaid principal amount of each Loan made by such Lender for the period from and
including the date of the making of such Loan to but excluding the date such Loan shall be paid in
full, at the following per annum rates:




     (i) during such periods as such Loan is a Base Rate Loan, at the Base Rate (as in
effect from time to time) plus the Applicable Margin;




     (ii) during such periods as such Loan is a LIBOR Loan, at the Adjusted Eurodollar Rate
for such Loan for the Interest Period therefor plus the Applicable Margin;




     (iii) if such Loan is an Absolute Rate Loan, at the Absolute Rate for such Loan, as
applicable, for the Interest Period therefor quoted by the Lender making such Loan in
accordance with Section 2.2.; and




     (iv) if such Loan is a LIBOR Margin Loan, at LIBOR for such Loan for the Interest
Period therefor, plus (or minus) the LIBOR Margin quoted by the Lender making such Loan in
accordance with Section 2.2.


Notwithstanding the foregoing, while an Event of Default exists, the Borrower shall pay to the
Agent for the account of each Lender interest at the Post-Default Rate on the outstanding principal
amount of any Loan made by such Lender, on all Reimbursement Obligations and on any other amount
payable by the Borrower hereunder or under the Notes held by such Lender to or for the account of
such Lender (including without limitation, accrued but unpaid interest to the extent permitted
under Applicable Law).




     (b) Payment of Interest. Accrued and unpaid interest on each Loan shall be payable
(i) in the case of a Base Rate Loan, monthly in arrears on the first Business Day of each calendar
month, (ii) in the case of a LIBOR Loan or a Bid Rate Loan, in arrears on the last day of each



- 36 -









 




Interest Period therefor, and, if such Interest Period is longer than three months, at three-month
intervals following the first day of such Interest Period, and (iii) in the case of any Loan, in
arrears upon the payment, prepayment or Continuation thereof or the Conversion of such Loan to a
Loan of another Type (but only on the principal amount so paid, prepaid, Continued or Converted).
Interest payable at the Post-Default Rate shall be payable from time to time on demand. Promptly
after the determination of any interest rate provided for herein or any change therein, the Agent
shall give notice thereof to the Lenders to which such interest is payable and to the Borrower.
All determinations by the Agent of an interest rate hereunder shall be conclusive and binding on
the Lenders and the Borrower for all purposes, absent manifest error.




Section 2.6. Number of Interest Periods.




     There may be no more than 10 different Interest Periods for LIBOR Loans and Bid Rate Loans,
collectively, outstanding at the same time (for which purpose Interest Periods described in
different lettered clauses of the definition of the term “Interest Period” shall be deemed to be
different Interest Periods even if they are coterminous).



Section 2.7. Repayment of Loans.




     (a) Revolving Loans. The Borrower shall repay the entire outstanding principal amount
of, and all accrued but unpaid interest on, the Revolving Loans on the Termination Date.



     (b) Bid Rate Loans. The Borrower shall repay the entire outstanding principal amount
of, and all accrued but unpaid interest on, each Bid Rate Loan on the last day of the Interest
Period of such Bid Rate Loan.



Section 2.8. Prepayments.




     (a) Optional. Subject to Section 4.4., the Borrower may prepay any Loan (other than a
Bid Rate Loan) at any time without premium or penalty. Bid Rate Loans may not be prepaid at the
option of the Borrower. The Borrower shall give the Agent at least one Business Day’s prior
written notice of the prepayment of any Revolving Loan and the Agent shall give each Lender notice
of any such prepayment promptly upon receipt of such notice from Borrower.



     (b) Mandatory. If at any time the aggregate principal amount of all outstanding
Revolving Loans, together with the aggregate amount of all Letter of Credit Liabilities, the
aggregate principal amount of all outstanding Bid Rate Loans and the aggregate principal amount of
all outstanding Swingline Loans, exceeds the aggregate amount of the Commitments in effect at such
time, the Borrower shall immediately pay to the Agent for the accounts of the Lenders the amount of
such excess. Such payment shall be applied to pay all amounts of principal outstanding on the
Loans and any Reimbursement Obligations pro rata in accordance with Section 3.2. and if any Letters
of Credit are outstanding at such time the remainder, if any, shall be deposited into the
Collateral Account for application to any Reimbursement Obligations. If the Borrower is required
to pay any outstanding LIBOR Loans or Bid Rate Loans by reason of this Section prior to the end of
the applicable Interest Period therefor, the Borrower shall pay all amounts due under Section 4.4.



- 37 -









 





Section 2.9. Continuation.




     So long as no Default or Event of Default shall exist, the Borrower may on any Business Day,
with respect to any LIBOR Loan, elect to maintain such LIBOR Loan or any portion thereof as a LIBOR
Loan by selecting a new Interest Period for such LIBOR Loan. Each new Interest Period selected
under this Section shall commence on the last day of the immediately preceding Interest Period.
Each selection of a new Interest Period shall be made by the Borrower giving to the Agent a Notice
of Continuation not later than 11:00 a.m. on the third Business Day prior to the date of any such
Continuation. Such notice by the Borrower of a Continuation shall be by telephone or telecopy,
confirmed immediately in writing if by telephone, in the form of a Notice of Continuation,
specifying (a) the proposed date of such Continuation, (b) the LIBOR Loans and portions thereof
subject to such Continuation and (c) the duration of the selected Interest Period, all of which
shall be specified in such manner as is necessary to comply with all limitations on Loans
outstanding hereunder. Each Notice of Continuation shall be irrevocable by and binding on the
Borrower once given. Promptly after receipt of a Notice of Continuation, the Agent shall notify
each Lender by telecopy, or other similar form of transmission, of the proposed Continuation. If
the Borrower shall fail to select in a timely manner a new Interest Period for any LIBOR Loan in
accordance with this Section, or if a Default or Event of Default shall exist, such Loan will
automatically, on the last day of the current Interest Period therefor, Convert into a Base Rate
Loan notwithstanding the first sentence of Section 2.10. or the Borrower’s failure to comply with
any of the terms of such Section.



Section 2.10. Conversion.




     So long as no Default or Event of Default shall exist, the Borrower may on any Business Day,
upon the Borrower’s giving of a Notice of Conversion to the Agent, Convert all or a portion of a
Loan of one Type into a Loan of another Type. Any Conversion of a LIBOR Loan into a Base Rate Loan
shall be made on, and only on, the last day of an Interest Period for such LIBOR Loan and, upon
Conversion of a Base Rate Loan into a LIBOR Loan, the Borrower shall pay accrued interest to the
date of Conversion on the principal amount so Converted. Each such Notice of Conversion shall be
given not later than 11:00 a.m. on the Business Day prior to the date of any proposed Conversion
into Base Rate Loans and on the third Business Day prior to the date of any proposed Conversion
into LIBOR Loans. Promptly after receipt of a Notice of Conversion, the Agent shall notify each
Lender by telecopy, or other similar form of transmission, of the proposed Conversion. Subject to
the restrictions specified above, each Notice of Conversion shall be by telephone (confirmed
immediately in writing) or telecopy in the form of a Notice of Conversion specifying (a) the
requested date of such Conversion, (b) the Type of Loan to be Converted, (c) the portion of such
Type of Loan to be Converted, (d) the Type of Loan such Loan is to be Converted into and (e) if
such Conversion is into a LIBOR Loan, the requested duration of the Interest Period of such Loan.
Each Notice of Conversion shall be irrevocable by and binding on the Borrower once given.



Section 2.11. Notes.




     (a) Revolving Note. The Revolving Loans made by each Lender shall, in addition to
this Agreement, also be evidenced by a promissory note of the Borrower substantially in the form of
Exhibit K (each a “Revolving Note”), payable to the order of such Lender in a principal



- 38 -









 




amount equal to the amount of its Commitment as originally in effect and otherwise duly completed.




     (b) Bid Rate Notes. The Bid Rate Loans made by any Lender shall, in addition to this
Agreement, also be evidenced by a promissory note of the Borrower substantially in the form of
Exhibit L (each a “Bid Rate Note”), payable to the order of such Lender and otherwise duly
completed.



     (c) Records. The date, amount, interest rate, Type and duration of Interest Periods
(if applicable) of each Loan made by each Lender to the Borrower, and each payment made on account
of the principal thereof, shall be recorded by such Lender on its books and such entries shall be
binding on the Borrower absent manifest error.



     (d) Lost, Stolen, Destroyed or Mutilated Notes. Upon receipt by the Borrower of (i)
written notice from a Lender that a Note of such Lender has been lost, stolen, destroyed or
mutilated, and (ii) (A) in the case of loss, theft or destruction, an unsecured agreement of
indemnity from such Lender in form reasonably satisfactory to the Borrower, or (B) in the case of
mutilation, upon surrender and cancellation of such Note, the Borrower shall at its own expense
execute and deliver to such Lender a new Note dated the date of such lost, stolen, destroyed or
mutilated Note.



Section 2.12. Voluntary Reductions of the Commitment.




     The Borrower shall have the right to terminate or reduce the aggregate unused amount of the
Commitments (for which purpose use of the Commitments shall be deemed to include the aggregate
amount of Letter of Credit Liabilities and the aggregate principal amount of all outstanding
Swingline Loans and Bid Rate Loans) at any time and from time to time without penalty or premium
upon not less than 5 Business Days prior written notice to the Agent of each such termination or
reduction, which notice shall specify the effective date thereof and the amount of any such
reduction and shall be irrevocable once given and effective only upon receipt by the Agent;
provided, however, that if Borrower seeks to reduce the aggregate amount of the Commitments below
$200,000,000, then the Commitments shall be reduced to zero and except as otherwise provided
herein, the provisions of this Agreement shall terminate. The Agent will promptly transmit such
notice to each Lender. The Commitments, once terminated or reduced may not be increased or
reinstated.



Section 2.13. Expiration or Maturity Date of Letters of Credit Past Termination Date.




     If on the date the Commitments are terminated or reduced to zero (whether voluntarily, by
reason of the occurrence of an Event of Default or otherwise), there are any Letters of Credit
outstanding hereunder, the Borrower shall, on such date, pay to the Agent an amount of money equal
to the Stated Amount of such Letter(s) of Credit for deposit into the Collateral Account.



Section 2.14. Amount Limitations.




     Notwithstanding any other term of this Agreement or any other Loan Document, no Lender shall
be required to make a Loan, no Lender shall make any Bid Rate Loan, the Agent



- 39 -









 




shall not be required to issue a Letter of Credit and no reduction of the Commitments pursuant to
Section 2.12. shall take effect, if immediately after the making of such Loan or the issuance of
such Letter of Credit or such reduction in the Commitments:




     (a) the aggregate principal amount of all outstanding Revolving Loans, together with the
aggregate principal amount of all outstanding Bid Rate Loans, the aggregate principal amount of all
outstanding Swingline Loans and the aggregate amount of all Letter of Credit Liabilities, would
exceed the aggregate amount of the Commitments at such time; or



     (b) the aggregate principal amount of all outstanding Bid Rate Loans would exceed 50% of the
aggregate amount of the Commitments at such time; provided, however, not more than once during any
calendar quarter, the Borrower may elect that the limitation of this clause (b) not apply to a
single Bid Rate Borrowing comprised of Bid Rate Loans having Interest Periods not exceeding 30 days
in duration.



Section 2.15. Increase of Commitments.




     The Borrower shall have the right at any time during the term of this Agreement to request
increases in the aggregate amount of the Commitments (provided that the aggregate amount of the
Commitments after giving effect to any increases pursuant to this Section shall not exceed
$750,000,000) by providing written notice to the Agent, which notice shall be irrevocable once
given. Each such increase in the Commitments must be in an aggregate minimum amount of $25,000,000
and integral multiples of $5,000,000 in excess thereof. No Lender shall be required to increase
its Commitment and any new Lender becoming a party to this Agreement in connection with any such
requested increase must be an Eligible Assignee. If a new Lender becomes a party to this
Agreement, or if any existing Lender agrees to increase its Commitment, such Lender shall on the
date it becomes a Lender hereunder (or increases its Commitment, in the case of an existing Lender)
(and as a condition thereto) purchase from the other Lenders its Commitment Percentage (or in the
case of an existing Lender, the increase in the amount of its Commitment Percentage, in each case
as determined after giving effect to the increase of Commitments) of any outstanding Revolving
Loans, by making available to the Agent for the account of such other Lenders at the Principal
Office, in same day funds, an amount equal to the sum of (A) the portion of the outstanding
principal amount of such Revolving Loans to be purchased by such Lender plus (B) the aggregate
amount of payments previously made by the other Lenders under Section 2.4.(j) which have not been
repaid plus (C) interest accrued and unpaid to and as of such date on such portion of the
outstanding principal amount of such Revolving Loans. The Borrower shall pay to the Lenders
amounts payable, if any, to such Lenders under Section 4.4. as a result of the prepayment of any
such Revolving Loans. No increase of the Commitments may be effected under this Section if (x) a
Default or Event of Default shall be in existence on the effective date of such increase or (y) any
representation or warranty made or deemed made by the Borrower or any other Loan Party in any Loan
Document to which any such Loan Party is a party is not (or would not be) true or correct on the
effective date of such increase (except for representations or warranties which expressly relate
solely to an earlier date). In connection with any increase in the aggregate amount of the
Commitments pursuant to this subsection, (a) any Lender becoming a party hereto (or increasing its
Commitment) and the Borrower shall execute such documents and agreements as the Agent may
reasonably request and (b) the Borrower shall make appropriate arrangements so that each new



- 40 -









 




Lender, and any existing Lender increasing its Commitment, receives a new or replacement Note,
as appropriate, in the amount of such Lender’s Commitment within 2 Business Days of the
effectiveness of the applicable increase in the aggregate amount of Commitments.




Article III. Payments, Fees and Other General Provisions




Section 3.1. Payments.




     Except to the extent otherwise provided herein, all payments of principal, interest and other
amounts to be made by the Borrower under this Agreement or any other Loan Document shall be made in
Dollars, in immediately available funds, without deduction, set-off or counterclaim, to the Agent
at its Principal Office, not later than 2:00 p.m. on the date on which such payment shall become
due (each such payment made after such time on such due date to be deemed to have been made on the
next succeeding Business Day). Subject to Section 10.4., the Borrower shall, at the time of making
each payment under this Agreement or any Note, specify to the Agent the amounts payable by the
Borrower hereunder to which such payment is to be applied. Each payment received by the Agent for
the account of a Lender under this Agreement or any Note shall be paid to such Lender at the
applicable Lending Office of such Lender no later than 5:00 p.m. on the date of receipt. If the
Agent fails to pay such amount to a Lender as provided in the previous sentence, the Agent shall
pay interest on such amount until paid at a rate per annum equal to the Federal Funds Rate from
time to time in effect. If the due date of any payment under this Agreement or any other Loan
Document would otherwise fall on a day which is not a Business Day such date shall be extended to
the next succeeding Business Day and interest shall be payable for the period of such extension.



Section 3.2. Pro Rata Treatment.




     Except to the extent otherwise provided herein: (a) each borrowing from the Lenders under
Section 2.1.(a), 2.3.(e) and 2.4.(e) shall be made from the Lenders, each payment of the Fees under
Section 3.6.(a) and the first sentence of Section 3.6.(b) shall be made for the account of the
Lenders, and each termination or reduction of the amount of the Commitments under Section 2.12.
shall be applied to the respective Commitments of the Lenders, pro rata according to the amounts of
their respective Commitments; (b) each payment or prepayment of principal of Revolving Loans by the
Borrower shall be made for the account of the Lenders pro rata in accordance with the respective
unpaid principal amounts of the Revolving Loans held by them, provided that if immediately prior to
giving effect to any such payment in respect of any Revolving Loans the outstanding principal
amount of the Revolving Loans shall not be held by the Lenders pro rata in accordance with their
respective Commitments in effect at the time such Loans were made, then such payment shall be
applied to the Revolving Loans in such manner as shall result, as nearly as is practicable, in the
outstanding principal amount of the Revolving Loans being held by the Lenders pro rata in
accordance with their respective Commitments; (c) each payment of interest on Revolving Loans by
the Borrower shall be made for the account of the Lenders pro rata in accordance with the amounts
of interest on such Loans then due and payable to the respective Lenders; (d) the making,
Conversion and Continuation of Revolving Loans of a particular Type (other than Conversions
provided for by Section 4.6.) shall be made pro rata among the Lenders according to the amounts of
their respective Commitments (in the



- 41 -









 




case of making of Loans) or their respective Loans (in the case of Conversions and Continuations of
Loans) and the then current Interest Period for each Lender’s portion of each Loan of such Type
shall be coterminous; (e) the Lenders’ participation in, and payment obligations in respect of,
Letters of Credit under Section 2.4., shall be pro rata in accordance with their respective
Commitments; (f) the Lenders’ participation in, and payment obligations in respect of, Swingline
Loans under Section 2.3., shall be pro rata in accordance with their respective Commitments; and
(g) each mandatory prepayment of principal of Bid Rate Loans by the Borrower pursuant to Section
2.8.(b) shall be made for account of the Lenders then owed Bid Rate Loans pro rata in accordance
with the respective unpaid principal amounts of the Bid Rate Loans then owing to each such Lender.
All payments of principal, interest, fees and other amounts in respect of the Swingline Loans shall
be for the account of the Swingline Lender only (except to the extent any Lender shall have
acquired and funded a participating interest in any such Swingline Loan pursuant to Section 2.3.(e)
in which case such payments shall be pro rata in accordance with such participating interests).




Section 3.3. Sharing of Payments, Etc.




     If a Lender shall obtain payment of any principal of, or interest on, any Loan made by it to
the Borrower under this Agreement, or shall obtain payment on any other Obligation owing by the
Borrower or a Loan Party through the exercise of any right of set-off, banker’s lien or
counterclaim or similar right or otherwise or through voluntary prepayments directly to a Lender or
other payments made by the Borrower to a Lender not in accordance with the terms of this Agreement
and such payment should be distributed to the Lenders pro rata in accordance with Section 3.2. or
Section 10.4., as applicable, such Lender shall promptly purchase from the other Lenders
participations in (or, if and to the extent specified by such Lender, direct interests in) the
Loans made by the other Lenders or other Obligations owed to such other Lenders in such amounts,
and make such other adjustments from time to time as shall be equitable, to the end that all the
Lenders shall share the benefit of such payment (net of any reasonable expenses which may be
incurred by such Lender in obtaining or preserving such benefit) pro rata in accordance with
Section 3.2. or Section 10.4., as applicable. To such end, all the Lenders shall make appropriate
adjustments among themselves (by the resale of participations sold or otherwise) if such payment is
rescinded or must otherwise be restored. The Borrower agrees that any Lender so purchasing a
participation (or direct interest) in the Loans or other Obligations owed to such other Lenders may
exercise all rights of set-off, banker’s lien, counterclaim or similar rights with respect to such
participation as fully as if such Lender were a direct holder of Loans in the amount of such
participation. Nothing contained herein shall require any Lender to exercise any such right or
shall affect the right of any Lender to exercise, and retain the benefits of exercising, any such
right with respect to any other indebtedness or obligation of the Borrower.



Section 3.4. Several Obligations.




     No Lender shall be responsible for the failure of any other Lender to make a Loan or to
perform any other obligation to be made or performed by such other Lender hereunder, and the
failure of any Lender to make a Loan or to perform any other obligation to be made or performed by
it hereunder shall not relieve the obligation of any other Lender to make any Loan or to perform
any other obligation to be made or performed by such other Lender.



- 42 -









 





Section 3.5. Minimum Amounts.




     (a) Borrowings and Conversions. Except as otherwise provided in Sections 2.3.(e) and
2.4.(e), each borrowing of Base Rate Loans shall be in an aggregate minimum amount of $1,000,000
and integral multiples of $500,000 in excess thereof. Each borrowing and each Conversion of LIBOR
Loans shall be in an aggregate minimum amount of $1,000,000 and integral multiples of $500,000 in
excess of that amount.



     (b) Prepayments. Each voluntary prepayment of Revolving Loans shall be in an
aggregate minimum amount of $1,000,000 and integral multiples of $500,000 in excess thereof (or, if
less, the aggregate principal amount of Revolving Loans then outstanding).



     (c) Reductions of Commitments. Each reduction of the Commitments under Section 2.12.
shall be in an aggregate minimum amount of $10,000,000 and integral multiples of $5,000,000 in
excess thereof.



     (d) Letters of Credit. The initial Stated Amount of each Letter of Credit shall be at
least $100,000.



Section 3.6. Fees.




     (a) Facility Fees. The Borrower agrees to pay to the Agent for the account of each
Lender a facility fee equal to the average daily amount of the Commitment of such Lender (whether
or not utilized) times the Facility Fee for the period from and including the Agreement Date to but
excluding the date such Commitment is terminated or reduced to zero or the Termination Date, such
fee to be paid in arrears on (i) the last Business Day of March, June, September and December in
each year, (ii) the date of each reduction in the Commitments (but only on the amount of the
reduction) and (iii) on the Termination Date.



     (b) Letter of Credit Fees. The Borrower agrees to pay to the Agent for the account of
each Lender a letter of credit fee at a rate per annum equal to the Applicable Margin for LIBOR
Loans times the daily average Stated Amount of each Letter of Credit for the period from and
including the date of issuance of such Letter of Credit (x) through and including the date such
Letter of Credit expires or is terminated or (y) to but excluding the date such Letter of Credit is
drawn in full and is not subject to reinstatement, as the case may be. The fees provided for in
the immediately preceding sentence shall be nonrefundable and payable in arrears on (i) the last
Business Day of March, June, September and December in each year, (ii) the Termination Date, (iii)
the date the Commitments are terminated or reduced to zero and (iv) thereafter from time to time on
demand of the Agent. In addition, the Borrower shall pay to the Agent for its own account and not
the account of any Lender, a fronting fee in respect of each Letter of Credit at the rate equal to
the greater of (i) $500 or (ii) one-eighth of one percent (0.125%) per annum on the daily average
Stated Amount of such Letter of Credit for the period from and including the date of issuance of
such Letter of Credit (A) through and including the date such Letter of Credit expires or is
terminated or (B) to but excluding the date such Letter of Credit is drawn in full. The fees
provided for in the immediately preceding sentence shall be nonrefundable and payable upon
issuance. The Borrower shall pay directly to the Agent from time to time on demand all
commissions, charges, costs and expenses in the amounts customarily charged by the Agent from



- 43 -









 




time to time in like circumstances with respect to the issuance of each Letter of Credit, drawings,
amendments and other transactions relating thereto.




     (c) Administrative and Other Fees. The Borrower agrees to pay the administrative and
other fees of the Agent as may be agreed to in writing by the Borrower and the Agent from time to
time.



Section 3.7. Computations.




     Unless otherwise expressly set forth herein, any accrued interest on any Loan, any Fees or any
other Obligations due hereunder shall be computed on the basis of a year of 360 days and the actual
number of days elapsed.



Section 3.8. Usury.




     In no event shall the amount of interest due or payable on the Loans or other Obligations
exceed the maximum rate of interest allowed by Applicable Law and, if any such payment is paid by
the Borrower or any other Loan Party or received by any Lender, then such excess sum shall be
credited as a payment of principal, unless the Borrower shall notify the respective Lender in
writing that the Borrower elects to have such excess sum returned to it forthwith. It is the
express intent of the parties hereto that the Borrower not pay and the Lenders not receive,
directly or indirectly, in any manner whatsoever, interest in excess of that which may be lawfully
paid by the Borrower under Applicable Law.



Section 3.9. Agreement Regarding Interest and Charges.




     The parties hereto hereby agree and stipulate that the only charge imposed upon the Borrower
for the use of money in connection with this Agreement is and shall be the interest specifically
described in Section 2.5.(a)(i) through (iv) and in Section 2.3.(c). Notwithstanding the
foregoing, the parties hereto further agree and stipulate that all agency fees, syndication fees,
facility fees, closing fees, letter of credit fees, underwriting fees, default charges, late
charges, funding or “breakage” charges, increased cost charges, attorneys’ fees and reimbursement
for costs and expenses paid by the Agent or any Lender to third parties or for damages incurred by
the Agent or any Lender, in each case in connection with the transactions contemplated by this
Agreement and the other Loan Documents, are charges made to compensate the Agent or any such Lender
for underwriting or administrative services and costs or losses performed or incurred, and to be
performed or incurred, by the Agent and the Lenders in connection with this Agreement and shall
under no circumstances be deemed to be charges for the use of money. All charges other than
charges for the use of money shall be fully earned and nonrefundable when due.



Section 3.10. Statements of Account.




     The Agent will account to the Borrower monthly with a statement of Loans, Letters of Credit,
accrued interest and Fees, charges and payments made pursuant to this Agreement and the other Loan
Documents, and such account rendered by the Agent shall be deemed conclusive



- 44 -









 




upon Borrower absent manifest error. The failure of the Agent to deliver such a statement of
accounts shall not relieve or discharge the Borrower from any of its obligations hereunder.




     Section 3.11. Defaulting Lenders.



     (a) Generally. If for any reason any Lender (a “Defaulting Lender”) shall fail or
refuse to perform any of its obligations under this Agreement or any other Loan Document to which
it is a party within the time period specified for performance of such obligation or, if no time
period is specified, if such failure or refusal continues for a period of two Business Days after
notice from the Agent, then, in addition to the rights and remedies that may be available to the
Agent or the Borrower under this Agreement or Applicable Law, such Defaulting Lender’s right to
participate in the administration of the Loans, this Agreement and the other Loan Documents,
including without limitation, any right to vote in respect of, to consent to or to direct any
action or inaction of the Agent or to be taken into account in the calculation of the Requisite
Lenders, shall be suspended during the pendency of such failure or refusal. If a Lender is a
Defaulting Lender because it has failed to make timely payment to the Agent of any amount required
to be paid to the Agent hereunder (without giving effect to any notice or cure periods), in
addition to other rights and remedies which the Agent or the Borrower may have under the
immediately preceding provisions or otherwise, the Agent shall be entitled (i) to collect interest
from such Defaulting Lender on such delinquent payment for the period from the date on which the
payment was due until the date on which the payment is made at the Federal Funds Rate, (ii) to
withhold or setoff and to apply in satisfaction of the defaulted payment and any related interest,
any amounts otherwise payable to such Defaulting Lender under this Agreement or any other Loan
Document and (iii) to bring an action or suit against such Defaulting Lender in a court of
competent jurisdiction to recover the defaulted amount and any related interest. Any amounts
received by the Agent in respect of a Defaulting Lender’s Loans shall not be paid to such
Defaulting Lender and shall be held uninvested by the Agent and either applied against the purchase
price of such Loans under the following subsection (b) or paid to such Defaulting Lender upon the
Defaulting Lender’s curing of its default.



     (b) Purchase or Cancellation of Defaulting Lender’s Commitment. Any Lender who is not
a Defaulting Lender shall have the right, but not the obligation, in its sole discretion, to
acquire all of a Defaulting Lender’s Commitment. Any Lender desiring to exercise such right shall
give written notice thereof to the Agent and the Borrower no sooner than 2 Business Days and not
later than 5 Business Days after such Defaulting Lender became a Defaulting Lender. If more than
one Lender exercises such right, each such Lender shall have the right to acquire an amount of such
Defaulting Lender’s Commitment in proportion to the Commitments of the other Lenders exercising
such right. If after such 5th Business Day, the Lenders have not elected to purchase all of the
Commitment of such Defaulting Lender, then the Borrower may, by giving written notice thereof to
the Agent, such Defaulting Lender and the other Lenders, either (i) demand that such Defaulting
Lender assign its Commitment to an Eligible Assignee subject to and in accordance with the
provisions of Section 12.5.(d) for the purchase price provided for below or (ii) terminate the
Commitment of such Defaulting Lender, whereupon such Defaulting Lender shall no longer be a party
hereto or have any rights or obligations hereunder or under any of the other Loan Documents. No
party hereto shall have any obligation whatsoever to initiate any such replacement or to assist in
finding an Eligible Assignee. Upon any such purchase or assignment, the Defaulting Lender’s
interest in the Loans and its rights hereunder (but not its



- 45 -









 




liability in respect thereof or under the Loan Documents or this Agreement to the extent the same
relate to the period prior to the effective date of the purchase) shall terminate on the date of
purchase, and the Defaulting Lender shall promptly execute all documents reasonably requested to
surrender and transfer such interest to the purchaser or assignee thereof, including an appropriate
Assignment and Acceptance Agreement and, notwithstanding Section 12.5.(d), shall pay to the Agent
an assignment fee in the amount of $10,000. The purchase price for the Commitment of a Defaulting
Lender shall be equal to the amount of the principal balance of the Loans outstanding and owed by
the Borrower to the Defaulting Lender. Prior to payment of such purchase price to a Defaulting
Lender, the Agent shall apply against such purchase price any amounts retained by the Agent
pursuant to the last sentence of the immediately preceding subsection (a). The Defaulting Lender
shall be entitled to receive amounts owed to it by the Borrower under the Loan Documents which
accrued prior to the date of the default by the Defaulting Lender, to the extent the same are
received by the Agent from or on behalf of the Borrower. There shall be no recourse against any
Lender or the Agent for the payment of such sums except to the extent of the receipt of payments
from any other party or in respect of the Loans.




Section 3.12. Taxes.




     (a) Taxes Generally. All payments by the Borrower of principal of, and interest on,
the Loans and all other Obligations shall be made free and clear of and without deduction for any
present or future excise, stamp or other taxes, fees, duties, levies, imposts, charges, deductions,
withholdings or other charges of any nature whatsoever imposed by any taxing authority, but
excluding (i) franchise taxes, (ii) any taxes (other than withholding taxes) that would not be
imposed but for a connection between the Agent or a Lender and the jurisdiction imposing such taxes
(other than a connection arising solely by virtue of the activities of the Agent or such Lender
pursuant to or in respect of this Agreement or any other Loan Document), (iii) any taxes imposed on
or measured by any Lender’s assets, net income, receipts or branch profits, and (iv) any taxes,
fees, duties, levies, imposts, charges, deductions, withholdings or other charges to the extent
imposed as a result of the failure of the Agent or a Lender, as applicable, to provide and keep
current (to the extent legally able) any certificates, documents or other evidence required to
qualify for an exemption from, or reduced rate of, any such taxes fees, duties, levies, imposts,
charges, deductions, withholdings or other charges or required by the immediately following
subsection (c) to be furnished by the Agent or such Lender, as applicable (such non-excluded items
being collectively called “Taxes”). If any withholding or deduction from any payment to be made by
the Borrower hereunder is required in respect of any Taxes pursuant to any Applicable Law, then the
Borrower will:




     (i) pay directly to the relevant Governmental Authority the full amount required to be
so withheld or deducted;




     (ii) promptly forward to the Agent an official receipt or other documentation
satisfactory to the Agent evidencing such payment to such Governmental Authority; and




     (iii) pay to the Agent for its account or the account of the applicable Lender, as the
case may be, such additional amount or amounts as is necessary to ensure that the net amount
actually received by the Agent or such Lender will equal the full amount that the



- 46 -









 






Agent or such Lender would have received had no such withholding or deduction been required.



     (b) Tax Indemnification. If the Borrower fails to pay any Taxes when due to the
appropriate Governmental Authority or fails to remit to the Agent, for its account or the account
of the respective Lender, as the case may be, the required receipts or other required documentary
evidence, the Borrower shall indemnify the Agent and the Lenders for any incremental Taxes,
interest or penalties that may become payable by the Agent or any Lender as a result of any such
failure. For purposes of this Section, a distribution hereunder by the Agent or any Lender to or
for the account of any Lender shall be deemed a payment by the Borrower.



     (c) Tax Forms. Prior to the date that any Lender or Participant organized under the
laws of a jurisdiction outside the United States of America becomes a party hereto, such Person
shall deliver to the Borrower and the Agent such certificates, documents or other evidence, as
required by the Internal Revenue Code or Treasury Regulations issued pursuant thereto (including
Internal Revenue Service Forms W-8ECI and W-8BEN, as applicable, or appropriate successor forms),
properly completed, currently effective and duly executed by such Lender or Participant
establishing that payments to it hereunder and under the Notes are (i) not subject to United States
Federal backup withholding tax and (ii) not subject to United States Federal withholding tax under
the Internal Revenue Code. Each such Lender or Participant shall (x) deliver further copies of
such forms or other appropriate certifications on or before the date that any such forms expire or
become obsolete and after the occurrence of any event requiring a change in the most recent form
delivered to the Borrower or the Agent and (y) obtain such extensions of the time for filing, and
renew such forms and certifications thereof, as may be reasonably requested by the Borrower or the
Agent. The Borrower shall not be required to pay any amount pursuant to last sentence of
subsection (a) above to any Lender or Participant that is organized under the laws of a
jurisdiction outside of the United States of America or the Agent, if it is organized under the
laws of a jurisdiction outside of the United States of America, if such Lender, Participant or the
Agent, as applicable, fails to comply with the requirements of this subsection. If any such Lender
or Participant fails to deliver the above forms or other documentation, then the Agent may withhold
from any payments to be made to such Lender under any of the Loan Documents such amounts as are
required by the Internal Revenue Code. If any Governmental Authority asserts that the Agent did not
properly withhold or backup withhold, as the case may be, any tax or other amount from payments
made to or for the account of any Lender, such Lender shall indemnify the Agent therefor, including
all penalties and interest, any taxes imposed by any jurisdiction on the amounts payable to the
Agent under this Section, and costs and expenses (including all reasonable fees and disbursements
of any law firm or other external counsel and the allocated cost of internal legal services and all
disbursements of internal counsel) of the Agent. The obligation of the Lenders under this Section
shall survive the termination of the Commitments, repayment of all Obligations and the resignation
or replacement of the Agent.



- 47 -









 





Article IV. Yield Protection, Etc.




Section 4.1. Additional Costs; Capital Adequacy.




     (a) Additional Costs. The Borrower shall promptly pay to the Agent for the account of
a Lender from time to time such amounts as such Lender may determine to be necessary to compensate
such Lender for any costs incurred by such Lender that it determines are attributable to its making
or maintaining of any LIBOR Loans or its obligation to make any LIBOR Loans hereunder, any
reduction in any amount receivable by such Lender under this Agreement or any of the other Loan
Documents in respect of any of such Loans or such obligation or the maintenance by such Lender of
capital in respect of its Loans or its Commitment (such increases in costs and reductions in
amounts receivable being herein called “Additional Costs”), resulting from any Regulatory Change
that: (i) changes the basis of taxation of any amounts payable to such Lender under this Agreement
or any of the other Loan Documents in respect of any of such Loans or its Commitment (other than
taxes, fees, duties, levies, imposts, charges, deductions, withholdings or other charges which are
excluded from the definition of Taxes pursuant to the first sentence of Section 3.12.(a)); or (ii)
imposes, modifies or deems applicable any reserve, special deposit or similar requirements (other
than Regulation D of the Board of Governors of the Federal Reserve System or other reserve
requirement to the extent utilized in the determination of the Adjusted Eurodollar Rate for such
Loan) relating to any extensions of credit or other assets of, or any deposits with or other
liabilities of, such Lender, or any commitment of such Lender (including, without limitation, the
Commitment of such Lender hereunder); or (iii) has or would have the effect of reducing the rate of
return on capital of such Lender to a level below that which such Lender could have achieved but
for such Regulatory Change (taking into consideration such Lender’s policies with respect to
capital adequacy).



     (b) Lender’s Suspension of LIBOR Loans. Without limiting the effect of the provisions
of the immediately preceding subsection (a), if, by reason of any Regulatory Change, any Lender
either (i) incurs Additional Costs based on or measured by the excess above a specified level of
the amount of a category of deposits or other liabilities of such Lender that includes deposits by
reference to which the interest rate on LIBOR Loans is determined as provided in this Agreement or
a category of extensions of credit or other assets of such Lender that includes LIBOR Loans or (ii)
becomes subject to restrictions on the amount of such a category of liabilities or assets that it
may hold, then, if such Lender so elects by notice to the Borrower (with a copy to the Agent), the
obligation of such Lender to make or Continue, or to Convert any other Type of Loans into, LIBOR
Loans hereunder shall be suspended until such Regulatory Change ceases to be in effect (in which
case the provisions of Section 4.6. shall apply).



     (c) Additional Costs in Respect of Letters of Credit. Without limiting the
obligations of the Borrower under the preceding subsections of this Section (but without
duplication), if as a result of any Regulatory Change or any risk-based capital guideline or other
requirement heretofore or hereafter issued by any Governmental Authority there shall be imposed,
modified or deemed applicable any tax, reserve, special deposit, capital adequacy or similar
requirement against or with respect to or measured by reference to Letters of Credit and the result
shall be to increase the cost to the Agent of issuing (or any Lender of purchasing participations
in) or maintaining its obligation hereunder to issue (or purchase participations in) any Letter of
Credit



- 48 -









 




or reduce any amount receivable by the Agent or any Lender hereunder in respect of any Letter of
Credit, then, upon demand by the Agent or such Lender, the Borrower shall pay promptly, and in any
event within 3 Business Days of demand, to the Agent for its account or the account of such Lender,
as applicable, from time to time as specified by the Agent or a Lender, such additional amounts as
shall be sufficient to compensate the Agent or such Lender for such increased costs or reductions
in amount.




     (d) Notification and Determination of Additional Costs. Each of the Agent and each
Lender agrees to notify the Borrower of any event occurring after the Agreement Date entitling the
Agent or such Lender to compensation under any of the preceding subsections of this Section as
promptly as practicable; provided, however, the failure of the Agent or any Lender to give such
notice shall not release the Borrower from any of its obligations hereunder (and in the case of a
Lender, to the Agent). The Agent or such Lender agrees to furnish to the Borrower (and in the case
of a Lender, to the Agent) a certificate setting forth the basis and amount of each request by the
Agent or such Lender for compensation under this Section. Absent manifest error, determinations by
the Agent or any Lender of the effect of any Regulatory Change shall be conclusive, provided that
such determinations are made on a reasonable basis and in good faith.



Section 4.2. Suspension of LIBOR Loans.




     Anything herein to the contrary notwithstanding, if, on or prior to the determination of any
Adjusted Eurodollar Rate for any Interest Period:




     (a) the Agent reasonably determines (which determination shall be conclusive) that by
reason of circumstances affecting the relevant market, adequate and reasonable means do not
exist for ascertaining the Adjusted Eurodollar Rate for such Interest Period, or




     (b) the Agent reasonably determines (which determination shall be conclusive) that the
Adjusted Eurodollar Rate will not adequately and fairly reflect the cost to the Lenders of
making or maintaining LIBOR Loans for such Interest Period;


then the Agent shall give the Borrower and each Lender prompt notice thereof and, so long as such
condition remains in effect, the Lenders shall be under no obligation to, and shall not, make
additional LIBOR Loans, Continue LIBOR Loans or Convert Loans into LIBOR Loans and the Borrower
shall, on the last day of each current Interest Period for each outstanding LIBOR Loan, either
repay such Loan or Convert such Loan into a Base Rate Loan.




Section 4.3. Illegality.




     Notwithstanding any other provision of this Agreement, if any Lender shall reasonably
determine (which determination shall be conclusive and binding) that it has become unlawful for
such Lender to honor its obligation to make or maintain LIBOR Loans hereunder, then such Lender
shall promptly notify the Borrower thereof (with a copy to the Agent) and such Lender’s obligation
to make or Continue, or to Convert Loans of any other Type into, LIBOR Loans shall be suspended
until such time as such Lender may again make and maintain LIBOR Loans (in which case the
provisions of Section 4.6. shall be applicable).



- 49 -









 





Section 4.4. Compensation.




     The Borrower shall pay to the Agent for the account of each Lender, upon the request of such
Lender through the Agent, such amount or amounts as shall be sufficient (in the reasonable opinion
of such Lender) to compensate it for any loss, cost or expense that such Lender reasonably
determines is attributable to:




     (a) any payment or prepayment (whether mandatory or optional) of a LIBOR Loan or Bid
Rate Loan, or Conversion of a LIBOR Loan, made by such Lender for any reason (including,
without limitation, acceleration) on a date other than the last day of the Interest Period
for such Loan; or




     (b) any failure by the Borrower for any reason (including, without limitation, the
failure of any of the applicable conditions precedent specified in Article V. to be
satisfied) to borrow a LIBOR Loan or Bid Rate Loan from such Lender on the requested date
for such borrowing, or to Convert a Base Rate Loan into a LIBOR Loan or Continue a LIBOR
Loan on the requested date of such Conversion or Continuation.


Upon the Borrower’s request, any Lender requesting compensation under this Section shall provide
the Borrower with a statement setting forth the basis for requesting such compensation and the
method for determining the amount thereof. Absent manifest error, determinations by any Lender in
any such statement shall be conclusive, provided that such determinations are made on a reasonable
basis and in good faith.




Section 4.5. Affected Lenders.




     If (a) a Lender requests compensation pursuant to Section 3.12. or 4.1., and the Requisite
Lenders are not also doing the same, or (b) the obligation of any Lender to make LIBOR Loans or to
Continue, or to Convert Base Rate Loans into, LIBOR Loans shall be suspended pursuant to Section
4.1.(b) or 4.3. but the obligation of the Requisite Lenders shall not have been suspended under
such Sections, then, so long as there does not then exist any Default or Event of Default, the
Borrower may either (i) demand that such Lender (the “Affected Lender”), and upon such demand the
Affected Lender shall promptly, and in any event within 5 Business Days of such demand, assign its
Commitment to an Eligible Assignee subject to and in accordance with the provisions of Section
12.5.(d) for a purchase price equal to the aggregate principal balance of Loans then owing to the
Affected Lender plus any accrued but unpaid interest thereon and accrued but unpaid fees owing to
the Affected Lender, or any other amount as may be mutually agreed upon by such Affected Lender and
Eligible Assignee, or (ii) pay to the Affected Lender the aggregate principal balance of Loans then
owing to the Affected Lender plus any accrued but unpaid interest thereon and accrued but unpaid
fees owing to the Affected Lender, whereupon the Affected Lender shall no longer be a party hereto
or have any rights or obligations hereunder or under any of the other Loan Documents. Each of the
Agent and the Affected Lender shall reasonably cooperate in effectuating the replacement of such
Affected Lender under this Section, but at no time shall the Agent, such Affected Lender nor any
other Lender be obligated in any way whatsoever to initiate any such replacement or to assist in
finding an Eligible Assignee. The exercise by the Borrower of its rights under this Section shall
be at the Borrower’s sole cost and




- 50 -










 




expense and at no cost or expense to the Agent, the Affected Lender or any of the other
Lenders. The terms of this Section shall not in any way limit the Borrower’s obligation to pay to
any Affected Lender compensation owing to such Affected Lender pursuant to Section 3.12., 4.1. or
12.9. with respect to periods up to the date of replacement.




Section 4.6. Treatment of Affected Loans.




     If the obligation of any Lender to make LIBOR Loans or to Continue, or to Convert Base Rate
Loans into, LIBOR Loans shall be suspended pursuant to Section 4.1.(b), 4.2. or 4.3., then such
Lender’s LIBOR Loans shall be automatically Converted into Base Rate Loans on the last day(s) of
the then current Interest Period(s) for LIBOR Loans (or, in the case of a Conversion required by
Section 4.1.(b) or 4.3., on such earlier date as such Lender may specify to the Borrower with a
copy to the Agent) and, unless and until such Lender gives notice as provided below that the
circumstances specified in Section 4.1. or 4.3. that gave rise to such Conversion no longer exist:




     (a) to the extent that such Lender’s LIBOR Loans have been so Converted, all payments
and prepayments of principal that would otherwise be applied to such Lender’s LIBOR Loans
shall be applied instead to its Base Rate Loans; and




     (b) all Loans that would otherwise be made or Continued by such Lender as LIBOR Loans
shall be made or Continued instead as Base Rate Loans, and all Base Rate Loans of such
Lender that would otherwise be Converted into LIBOR Loans shall remain as Base Rate Loans.


If such Lender gives notice to the Borrower (with a copy to the Agent) that the circumstances
specified in Section 4.1. or 4.3. that gave rise to the Conversion of such Lender’s LIBOR Loans
pursuant to this Section no longer exist (which such Lender agrees to do promptly upon such
circumstances ceasing to exist) at a time when LIBOR Loans made by other Lenders are outstanding,
then such Lender’s Base Rate Loans shall be automatically Converted, on the first day(s) of the
next succeeding Interest Period(s) for such outstanding LIBOR Loans, to the extent necessary so
that, after giving effect thereto, all Loans held by the Lenders holding LIBOR Loans and by such
Lender are held pro rata (as to principal amounts, Types and Interest Periods) in accordance with
their respective Commitments.




Section 4.7. Change of Lending Office.




     Each Lender agrees that it will use reasonable efforts to designate an alternate Lending
Office with respect to any of its Loans affected by the matters or circumstances described in
Sections 3.12., 4.1. or 4.3. to reduce the liability of the Borrower or avoid the results provided
thereunder, so long as such designation is not disadvantageous to such Lender as determined by such
Lender in its sole discretion, except that such Lender shall have no obligation to designate a
Lending Office located in the United States of America.



- 51 -









 





Section 4.8. Assumptions Concerning Funding of LIBOR Loans.




     Calculation of all amounts payable to a Lender under this Article IV. shall be made as though
such Lender had actually funded LIBOR Loans through the purchase of deposits in the relevant
market bearing interest at the rate applicable to such LIBOR Loans in an amount equal to the amount
of the LIBOR Loans and having a maturity comparable to the relevant Interest Period; provided,
however, that each Lender may fund each of its LIBOR Loans in any manner it sees fit and the
foregoing assumption shall be used only for calculation of amounts payable under this Article IV.



Article V. Conditions Precedent




Section 5.1. Initial Conditions Precedent.




     The obligation of the Lenders to effect or permit the occurrence of the first Credit Event
hereunder, whether as the making of a Loan or the issuance of a Letter of Credit, is subject to the
following conditions precedent:



     (a) The Agent shall have received each of the following, in form and substance satisfactory to
the Agent:




     (i) Counterparts of this Agreement executed by each of the parties hereto;




     (ii) Revolving Notes and Bid Rate Notes executed by the Borrower, payable to each
Lender (or Designated Lender, if applicable) and complying with the applicable provisions of
Section 2.11., and the Swingline Note executed by the Borrower;




     (iii) The Guaranty executed by each Guarantor existing as of the Effective Date;




     (iv) An opinion of legal counsel to the Loan Parties, addressed to the Agent, the
Lenders and the Swingline Lender, addressing the matters set forth in Exhibit M;




     (v) The articles of incorporation of the Borrower certified as of a recent date by the
Secretary of State of the state of its incorporation;




     (vi) A good standing certificate with respect to the Borrower issued as of a recent
date by the Secretary of State of the state of its incorporation and certificates of
qualification to transact business or other comparable certificates issued by the Secretary
of State (and any state department of taxation, as applicable) of each state in which the
Borrower is required to be so qualified and where the failure to be so qualified could
reasonably be expected to have a Material Adverse Effect;




     (vii) A certificate of incumbency signed by the Secretary or Assistant Secretary of the
Borrower with respect to each of the officers of the Borrower authorized to execute and
deliver the Loan Documents to which the Borrower is a party and the officers of the



- 52 -









 







Borrower then authorized to deliver Notices of Borrowing, Notices of Swingline Borrowings,
Bid Rate Quote Requests, Bid Rate Quote Acceptances, Notices of Continuation and Notices of
Conversion and to request the issuance of Letters of Credit;




     (viii) Copies, certified by the Secretary or Assistant Secretary of the Borrower, of
(i) the bylaws of the Borrower and (ii) all corporate (or comparable) action taken by the
Borrower to authorize the execution, delivery and performance of the Loan Documents to which
the Borrower is a party;




     (ix) The articles of incorporation, articles of organization, certificate of limited
partnership or other comparable organizational instrument (if any) of each Guarantor
certified as of a recent date by the Secretary of State of the state of formation of such
Guarantor;




     (x) A certificate of good standing or certificate of similar meaning with respect to
each Guarantor issued as of a recent date by the Secretary of State of the state of
formation of each such Guarantor and certificates of qualification to transact business or
other comparable certificates issued by each Secretary of State (and any state department of
taxation, as applicable) of each state in which such Guarantor is required to be so
qualified and where the failure to be so qualified could reasonably be expected to have a
Material Adverse Effect;




     (xi) A certificate of incumbency signed by the Secretary or Assistant Secretary (or
other individual performing similar functions) of each Guarantor with respect to each of the
officers of such Guarantor authorized to execute and deliver the Loan Documents to which
such Guarantor is a party;




     (xii) Copies certified by the Secretary or Assistant Secretary of each Guarantor (or
other individual performing similar functions) of (i) the by-laws of such Guarantor, if a
corporation, the operating agreement, if a limited liability company, the partnership
agreement, if a limited or general partnership, or other comparable document in the case of
any other form of legal entity and (ii) all corporate, partnership, member or other
necessary action taken by such Guarantor to authorize the execution, delivery and
performance of the Loan Documents to which it is a party;




     (xiii) a certificate from a Responsible Officer of the Borrower to the effect that (x)
all representations and warranties of the Loan Parties contained in the Loan Documents are
true, correct and complete in all material respects and (y) immediately after giving effect
to the transactions contemplated by this Agreement, no Default or Event of Default shall
exist;




     (xiv) The Fees then due and payable under Section 3.6., and any other Fees payable to
the Agent, the Titled Agents and the Lenders on or prior to the Effective Date;




     (xv) A Compliance Certificate calculated as of March 31, 2007 (giving pro forma effect
to this Agreement); and



- 53 -









 






     (xvi) Such other documents, agreements and instruments as the Agent on behalf of the
Lenders may reasonably request;




(b) In the good faith judgment of the Agent and the Lenders:




     (i) There shall not have occurred or become known to the Agent or any of the Lenders
any event, condition, situation or status since the date of the information contained in the
financial and business projections, budgets, pro forma data and forecasts concerning the
Borrower and its Subsidiaries delivered to the Agent and the Lenders prior to the Agreement
Date that has had or could reasonably be expected to result in a Material Adverse Effect;




     (ii) No litigation, action, suit, investigation or other arbitral, administrative or
judicial proceeding shall be pending or threatened which could reasonably be expected to (1)
result in a Material Adverse Effect or (2) restrain or enjoin, impose materially burdensome
conditions on, or otherwise materially and adversely affect the ability of the Borrower or
any other Loan Party to fulfill its obligations under the Loan Documents to which it is a
party;




     (iii) The Borrower and its Subsidiaries shall have received all approvals, consents and
waivers, and shall have made or given all necessary filings and notices as shall be required
to consummate the transactions contemplated hereby without the occurrence of any default
under, conflict with or violation of (1) any Applicable Law or (2) any agreement, document
or instrument to which the Borrower or any other Loan Party is a party or by which any of
them or their respective properties is bound, except for such approvals, consents, waivers,
filings and notices the receipt, making or giving of which would not reasonably be likely to
(A) have a Material Adverse Effect, or (B) restrain or enjoin, impose materially burdensome
conditions on, or otherwise materially and adversely affect the ability of the Borrower or
any other Loan Party to fulfill its obligations under the Loan Documents to which it is a
party; and




     (iv) There shall not have occurred or exist any other material disruption of financial
or capital markets that could reasonably be expected to materially and adversely affect the
transactions contemplated by the Loan Documents.



Section 5.2. Conditions Precedent to All Loans and Letters of Credit.




     The obligations of the Lenders to make any Loans, of the Agent to issue Letters of Credit, and
of the Swingline Lender to make any Swingline Loan are all subject to the further condition
precedent that: (a) no Default or Event of Default shall exist as of the date of the making of such
Loan or date of issuance of such Letter of Credit or would exist immediately after giving effect
thereto; and (b) the representations and warranties made or deemed made by the Borrower and each
other Loan Party in the Loan Documents to which any of them is a party, shall be true and correct
in all material respects on and as of the date of the making of such Loan or date of issuance of
such Letter of Credit with the same force and effect as if made on and as of such date except to
the extent that such representations and warranties expressly relate solely to an earlier



- 54 -









 




date (in which case such representations and warranties shall have been true and correct in all
material respects on and as of such earlier date) and except for changes in factual circumstances
specifically and expressly permitted hereunder. Each Credit Event shall constitute a certification
by the Borrower to the effect set forth in the preceding sentence (both as of the date of the
giving of notice relating to such Credit Event and, unless the Borrower otherwise notifies the
Agent prior to the date of such Credit Event, as of the date of the occurrence of such Credit
Event). In addition, if such Credit Event is the making of a Loan or the issuance of a Letter of
Credit, the Borrower shall be deemed to have represented to the Agent and the Lenders at the time
such Loan is made or Letter of Credit issued that all conditions to the occurrence of such Credit
Event contained in Article V. have been satisfied.




Section 5.3. Conditions as Covenants.




     If the Lenders make any Loans, or the Agent issues a Letter of Credit, prior to the
satisfaction of all conditions precedent set forth in Sections 5.1. and 5.2., the Borrower shall
nevertheless cause such condition or conditions to be satisfied within 5 Business Days after the
date of the making of such Loans or the issuance of such Letter of Credit. Unless set forth in
writing to the contrary, the making of its initial Loan by a Lender shall constitute a
certification by such Lender to the Agent and the other Lenders that the Borrower has satisfied the
conditions precedent for initial Loans set forth in Sections 5.1. and 5.2.



Article VI. Representations and Warranties




Section 6.1. Representations and Warranties.




     In order to induce the Agent and each Lender to enter into this Agreement and to make Loans
and issue Letters of Credit, the Borrower represents and warrants to the Agent and each Lender as
follows:



     (a) Organization; Power; Qualification. Each of the Borrower, its Subsidiaries and
the other Loan Parties is a corporation, partnership or other legal entity, duly organized or
formed, validly existing and in good standing under the jurisdiction of its incorporation or
formation, has the power and authority to own or lease its respective properties and to carry on
its respective business as now being and hereafter proposed to be conducted and is duly qualified
and is in good standing as a foreign corporation, partnership or other legal entity, and authorized
to do business, in each jurisdiction in which the character of its properties or the nature of its
business requires such qualification or authorization and where the failure to be so qualified or
authorized could reasonably be expected to have, in each instance, a Material Adverse Effect.



     (b) Ownership Structure. As of the Agreement Date Part I of Schedule 6.1.(b) is a
complete and correct list of all Subsidiaries of the Borrower setting forth for each such
Subsidiary, (i) the jurisdiction of organization of such Subsidiary, (ii) each Person holding any
Equity Interests in such Subsidiary, (iii) the nature of the Equity Interests held by each such
Person, (iv) the percentage of ownership of such Subsidiary represented by such Equity Interests
and (v) whether such Subsidiary is a Material Subsidiary and/or an Excluded Subsidiary. Except as
disclosed in such Schedule, as of the Agreement Date (i) each of the Borrower and its Subsidiaries
owns, free and clear of all Liens, and has the unencumbered right to vote, all



- 55 -









 




outstanding Equity Interests in each Person shown to be held by it on such Schedule, (ii) all of
the issued and outstanding capital stock of each such Person organized as a corporation is validly
issued, fully paid and nonassessable and (iii) there are no outstanding subscriptions, options,
warrants, commitments, preemptive rights or agreements of any kind (including, without limitation,
any stockholders’ or voting trust agreements) for the issuance, sale, registration or voting of, or
outstanding securities convertible into, any additional shares of capital stock of any class, or
partnership or other ownership interests of any type in, any such Person. As of the Agreement Date
Part II of Schedule 6.1.(b) correctly sets forth all Unconsolidated Affiliates of the Borrower,
including the correct legal name of such Person, the type of legal entity which each such Person
is, and all Equity Interests in such Person held directly or indirectly by the Borrower.




     (c) Authorization of Agreement, Etc. The Borrower has the right and power, and has
taken all necessary action to authorize it, to borrow and obtain other extensions of credit
hereunder. The Borrower and each other Loan Party has the right and power, and has taken all
necessary action to authorize it, to execute, deliver and perform each of the Loan Documents to
which it is a party in accordance with their respective terms and to consummate the transactions
contemplated hereby and thereby. The Loan Documents to which the Borrower or any other Loan Party
is a party have been duly executed and delivered by the duly authorized officers of such Person and
each is a legal, valid and binding obligation of such Person enforceable against such Person in
accordance with its respective terms except as the same may be limited by bankruptcy, insolvency,
and other similar laws affecting the rights of creditors generally and the availability of
equitable remedies for the enforcement of certain obligations (other than the payment of principal)
contained herein or therein may be limited by equitable principles generally.



     (d) Compliance of Loan Documents with Laws, Etc. The execution, delivery and
performance of this Agreement, the Notes and the other Loan Documents to which the Borrower or any
other Loan Party is a party in accordance with their respective terms and the borrowings and other
extensions of credit hereunder do not and will not, by the passage of time, the giving of notice,
or both: (i) require any Governmental Approval or violate any Applicable Law (including all
Environmental Laws) relating to the Borrower or any other Loan Party; (ii) conflict with, result in
a breach of or constitute a default under the organizational documents of the Borrower or any other
Loan Party, or any indenture, agreement or other instrument to which the Borrower or any other Loan
Party is a party or by which it or any of its respective properties may be bound; or (iii) result
in or require the creation or imposition of any Lien upon or with respect to any property now owned
or hereafter acquired by the Borrower or any other Loan Party other than pursuant to the Loan
Documents.



     (e) Compliance with Law; Governmental Approvals. The Borrower, each Subsidiary and
each other Loan Party is in compliance with each Governmental Approval applicable to it and in
compliance with all other Applicable Laws (including without limitation, Environmental Laws)
relating to the Borrower, a Subsidiary or such other Loan Party except for noncompliances which,
and Governmental Approvals the failure to possess which, would not, individually or in the
aggregate, cause a Default or Event of Default or have a Material Adverse Effect.



- 56 -









 





     (f) Title to Properties; Liens. As of the Agreement Date, Part I of Schedule 6.1.(f)
sets forth all of the real property owned or leased by the Borrower, each other Loan Party and each
other Subsidiary. Each such Person has good, marketable and legal title to, or a valid leasehold
interest in, its respective assets. As of the Agreement Date, there are no Liens against any
assets of the Borrower, any Subsidiary or any other Loan Party except for Permitted Liens.



     (g) Existing Indebtedness. Schedule 6.1.(g) is, as of the Agreement Date, a complete
and correct listing of all Debt of the Borrower and its Subsidiaries, including without limitation,
Guarantees of the Borrower and its Subsidiaries, and indicating whether such Debt is Consolidated
Secured Debt or Consolidated Unsecured Debt. The Borrower and its Subsidiaries have performed and
are in compliance with all of the terms of such Debt and all instruments and agreements relating
thereto, and no default or event of default, or event or condition which with the giving of notice,
the lapse of time, or both, would constitute such a default or event of default, exists with
respect to any such Debt.



     (h) Material Contracts. Each of the Borrower, its Subsidiaries and the other Loan
Parties that is a party to any Material Contract has performed and is in compliance with all of the
terms of such Material Contract, and no default or event of default, or event or condition which
with the giving of notice, the lapse of time, or both, would constitute such a default or event of
default, exists with respect to any such Material Contract.



     (i) Litigation. Except as set forth on Schedule 6.1.(i), there are no actions, suits,
investigations or proceedings pending (nor, to the knowledge of the Borrower, are there any
actions, suits or proceedings threatened, nor to the knowledge of the Borrower is there any basis
therefor) against or in any other way relating adversely to or affecting the Borrower, any
Subsidiary or any other Loan Party or any of its respective property in any court or before any
arbitrator of any kind or before or by any other Governmental Authority which could reasonably be
expected to have a Material Adverse Effect. There are no strikes, slow downs, work stoppages or
walkouts or other labor disputes in progress or threatened relating to the Borrower, any Subsidiary
or any other Loan Party that could reasonably be expected to have a Material Adverse Effect.



     (j) Taxes. All federal, state and other tax returns of the Borrower, any Subsidiary
or any other Loan Party required by Applicable Law to be filed have been duly filed, and all
federal, state and other taxes, assessments and other governmental charges or levies upon the
Borrower, any Subsidiary and each other Loan Party and its respective properties, income, profits
and assets which are due and payable have been paid, except any such nonpayment which is at the
time permitted under Section 7.6. As of the Agreement Date, none of the United States income tax
returns of the Borrower, its Subsidiaries or any other Loan Party is under audit. All charges,
accruals and reserves on the books of the Borrower and each of its Subsidiaries and each other Loan
Party in respect of any taxes or other governmental charges are in accordance with GAAP.



     (k) Financial Statements. The Borrower has furnished to each Lender copies of (i) the
audited consolidated balance sheet of the Borrower and its consolidated Subsidiaries for



- 57 -









 




the fiscal year ending December 31, 2006, and the related audited consolidated statements of
operations, cash flows and shareholders’ equity for the fiscal year ending on such dates, with the
opinion thereon of Ernst & Young LLP, and (ii) the unaudited consolidated balance sheet of the
Borrower and its consolidated Subsidiaries for the fiscal quarter ending March 31, 2007, and the
related unaudited consolidated statements of operations, cash flows and shareholders’ equity of the
Borrower and its consolidated Subsidiaries for the fiscal quarter ending on such date. Such
financial statements (including in each case related schedules and notes) are complete and correct
and present fairly, in all material respects and in accordance with GAAP, the consolidated
financial position of the Borrower and its consolidated Subsidiaries as at their respective dates
and the results of operations and the cash flow for such periods (subject, as to interim
statements, to changes resulting from normal year-end audit adjustments and to the addition of
footnotes and other presentation items). Neither the Borrower nor any of its Subsidiaries has on
the Agreement Date any material contingent liabilities, liabilities, liabilities for taxes, unusual
or long-term commitments or unrealized or forward anticipated losses from any unfavorable
commitments, except as referred to or reflected or provided for in said financial statements.




     (l) No Material Adverse Change. Since December 31, 2006, there has been no material
adverse change in the consolidated financial condition, results of operations, business or
prospects of the Borrower and its consolidated Subsidiaries taken as a whole. Each of the
Borrower, its Subsidiaries and the other Loan Parties is Solvent.



     (m) ERISA. Each member of the ERISA Group is in compliance with its obligations under
the minimum funding standards of ERISA and the Internal Revenue Code with respect to each Plan and
is in compliance with the presently applicable provisions of ERISA and the Internal Revenue Code
with respect to each Plan, except in each case for noncompliances which could not reasonably be
expected to have a Material Adverse Effect. As of the Agreement Date, no member of the ERISA Group
has (i) sought a waiver of the minimum funding standard under Section 412 of the Internal Revenue
Code in respect of any Plan, (ii) failed to make any contribution or payment to any Plan or
Multiemployer Plan or in respect of any Benefit Arrangement, or made any amendment to any Plan or
Benefit Arrangement, which has resulted or could result in the imposition of a Lien or the posting
of a bond or other security under ERISA or the Internal Revenue Code or (iii) incurred any
liability under Title IV of ERISA other than a liability to the PBGC for premiums under Section
4007 of ERISA.



     (n) Not Plan Assets; No Prohibited Transaction. None of the assets of the Borrower,
any Subsidiary or any other Loan Party constitute “plan assets” within the meaning of ERISA, the
Internal Revenue Code and the respective regulations promulgated thereunder. The execution,
delivery and performance of this Agreement and the other Loan Documents, and the borrowing and
repayment of amounts hereunder, do not and will not constitute “prohibited transactions” under
ERISA or the Internal Revenue Code.



     (o) Absence of Defaults. Neither the Borrower, any Subsidiary nor any other Loan
Party is in default under its articles of incorporation, bylaws, partnership agreement or other
similar organizational documents, and no event has occurred, which has not been remedied, cured or
waived: (i) which constitutes a Default or an Event of Default; or (ii) which constitutes,



- 58 -









 




or which with the passage of time, the giving of notice, a determination of materiality, the
satisfaction of any condition, or any combination of the foregoing, would constitute, a default or
event of default by the Borrower, any Subsidiary or any other Loan Party under any agreement (other
than this Agreement) or judgment, decree or order to which the Borrower or any Subsidiary or other
Loan Party is a party or by which the Borrower or any Subsidiary or other Loan Party or any of
their respective properties may be bound where such default or event of default could, individually
or in the aggregate, have a Material Adverse Effect.




     (p) Environmental Laws. Each of the Borrower, its Subsidiaries and the other Loan
Parties has obtained all Governmental Approvals which are required under Environmental Laws and is
in compliance with all terms and conditions of such Governmental Approvals which the failure to
obtain or to comply with could reasonably be expected to have a Material Adverse Effect. Except
for any of the following matters that could not be reasonably expected to have a Material Adverse
Effect, (i) the Borrower is not aware of, and has not received notice of, any past, present, or
future events, conditions, circumstances, activities, practices, incidents, actions, or plans
which, with respect to the Borrower, its Subsidiaries and each other Loan Party, may interfere with
or prevent compliance or continued compliance with Environmental Laws, or may give rise to any
common-law or legal liability, or otherwise form the basis of any claim, action, demand, suit,
proceeding, hearing, study, or investigation, based on or related to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport, or handling or the emission, discharge,
release or threatened release into the environment, of any pollutant, contaminant, chemical, or
industrial, toxic, or other Hazardous Material; and (ii) there is no civil, criminal, or
administrative action, suit, demand, claim, hearing, notice, or demand letter, notice of violation,
investigation, or proceeding pending or, to the Borrower’s knowledge after due inquiry, threatened,
against the Borrower, its Subsidiaries and each other Loan Party relating in any way to
Environmental Laws.



     (q) Investment Company; Etc. Neither the Borrower nor any Subsidiary nor any other
Loan Party is (i) an “investment company” or a company “controlled” by an “investment company”
within the meaning of the Investment Company Act of 1940, as amended, or (ii) subject to any other
Applicable Law which purports to regulate or restrict its ability to borrow money or to consummate
the transactions contemplated by this Agreement or to perform its obligations under any Loan
Document to which it is a party.



     (r) Margin Stock. Neither the Borrower, any Subsidiary nor any other Loan Party 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 U of the Board of Governors of the Federal Reserve System.



     (s) Affiliate Transactions. Except as permitted by Section 9.11., neither the
Borrower, any Subsidiary nor any other Loan Party is a party to or bound by any agreement or
arrangement (whether oral or written) to which any Affiliate of the Borrower, any Subsidiary or any
other Loan Party is a party.



     (t) Intellectual Property. Each of the Borrower, each other Loan Party and each other
Subsidiary owns or has the right to use, under valid license agreements or otherwise, all material



- 59 -









 




patents, licenses, franchises, trademarks, trademark rights, trade names, trade name rights, trade
secrets and copyrights (collectively, “Intellectual Property”) necessary to the conduct of its
businesses as now conducted and as contemplated by the Loan Documents, without known conflict with
any patent, license, franchise, trademark, trade secret, trade name, copyright, or other
proprietary right of any other Person. The Borrower, each other Loan Party and each other
Subsidiary have taken all such steps as they deem reasonably necessary to protect their respective
rights under and with respect to such Intellectual Property. No material claim has been asserted
by any Person with respect to the use of any Intellectual Property by the Borrower, any other Loan
Party or any other Subsidiary, or challenging or questioning the validity or effectiveness of any
Intellectual Property. The use of such Intellectual Property by the Borrower, its Subsidiaries and
the other Loan Parties, does not infringe on the rights of any Person, subject to such claims and
infringements as do not, in the aggregate, give rise to any liabilities on the part of the
Borrower, any other Loan Party or any other Subsidiary that could reasonably be expected to have a
Material Adverse Effect.




     (u) Business. As of the Agreement Date, the Borrower and its Subsidiaries are engaged
in the business of owning, selling, acquiring, renovating, developing and managing apartment
communities, together with other business activities incidental thereto.



     (v) Broker’s Fees. No broker’s or finder’s fee, commission or similar compensation
will be payable with respect to the transactions contemplated hereby. No other similar fees or
commissions will be payable by any Loan Party for any other services rendered to the Borrower or
any of its Subsidiaries ancillary to the transactions contemplated hereby.



     (w) Accuracy and Completeness of Information. No written information, report or other
papers or data (excluding financial projections and other forward looking statements) furnished to
the Agent or any Lender by, on behalf of, or at the direction of, the Borrower, any Subsidiary or
any other Loan Party in connection with or relating in any way to this Agreement, contained any
untrue statement of a fact material to the creditworthiness of the Borrower, any Subsidiary or any
other Loan Party or omitted to state a material fact necessary in order to make such statements
contained therein, in light of the circumstances under which they were made, not misleading. All
financial statements furnished to the Agent or any Lender by, on behalf of, or at the direction of,
the Borrower, any Subsidiary or any other Loan Party in connection with or relating in any way to
this Agreement, present fairly, in all material respects and in accordance with GAAP consistently
applied throughout the periods involved except that interim statements do not contain footnotes or
other presentation items, the financial position of the Persons involved as at the date thereof and
the results of operations for such periods (subject, as to interim statements, to changes resulting
from normal year-end audit adjustments). All financial projections and other forward looking
statements prepared by or on behalf of the Borrower, any Subsidiary or any other Loan Party that
have been or may hereafter be made available to the Agent or any Lender were or will be prepared in
good faith based on reasonable assumptions. As of the Effective Date, no fact is known to the
Borrower which has had, or may in the future have (so far as the Borrower can reasonably foresee),
a Material Adverse Effect which has not been set forth in the financial statements referred to in
Section 6.1.(k) or in such information, reports or other papers or data or otherwise disclosed in
writing to the Agent and the Lenders.



- 60 -









 





     (x) REIT Status. The Borrower qualifies as a REIT and is in compliance with all
requirements and conditions imposed under the Internal Revenue Code to allow the Borrower to
maintain its status as a REIT.



     (y) Unencumbered Pool Assets. As of the Agreement Date, Schedule 6.1.(y) is a correct
and complete list of all Unencumbered Pool Assets. Each of the assets included by the Borrower in
calculations of Gross Asset Value of the Unencumbered Pool satisfies all of the requirements
contained in the definition of “Unencumbered Pool Asset”.



     (z) Foreign Assets Control. None of the Borrower, any Subsidiary or any Affiliate of
the Borrower: (i) is a Sanctioned Person, (ii) has any of its assets in Sanctioned Entities, or
(iii) derives any of its operating income from investments in, or transactions with, Sanctioned
Persons or Sanctioned Entities.



Section 6.2. Survival of Representations and Warranties, Etc.




     All statements contained in any certificate, financial statement or other instrument delivered
by or on behalf of the Borrower, any Subsidiary or any other Loan Party to the Agent or any Lender
pursuant to or in connection with this Agreement or any of the other Loan Documents (including, but
not limited to, any such statement made in or in connection with any amendment hereto or thereto or
any statement contained in any certificate, financial statement or other instrument delivered by or
on behalf of the Borrower prior to the Agreement Date and delivered to the Agent or any Lender in
connection with the underwriting or closing the transactions contemplated hereby) shall constitute
representations and warranties made by the Borrower in favor of the Agent and the Lenders under
this Agreement. All representations and warranties made under this Agreement and the other Loan
Documents shall be deemed to be made at and as of the Agreement Date, the Effective Date and the
date of the occurrence of any Credit Event, except to the extent that such representations and
warranties expressly relate solely to an earlier date (in which case such representations and
warranties shall have been true and correct in all material respects on and as of such earlier
date) and except for changes in factual circumstances specifically permitted hereunder. All such
representations and warranties shall survive the effectiveness of this Agreement, the execution and
delivery of the Loan Documents and the making of the Loans and the issuance of the Letters of
Credit.



Article VII. Affirmative Covenants




     For so long as this Agreement is in effect, unless the Requisite Lenders (or, if required
pursuant to Section 12.6., all of the Lenders) shall otherwise consent in the manner provided for
in Section 12.6., the Borrower shall comply with the following covenants:



Section 7.1. Preservation of Existence and Similar Matters.




     Except as otherwise permitted under Section 9.7., the Borrower shall, and shall cause each
Subsidiary and each other Loan Party to, preserve and maintain its respective existence, rights,
franchises, licenses and privileges in the jurisdiction of its incorporation or formation and
qualify and remain qualified and authorized to do business in each jurisdiction in which the



- 61 -









 




character of its properties or the nature of its business requires such qualification and
authorization and where the failure to be so authorized and qualified could reasonably be expected
to have a Material Adverse Effect.




Section 7.2. Compliance with Applicable Law and Material Contracts.




     The Borrower shall, and shall cause each Subsidiary and each other Loan Party to, comply with
(a) all Applicable Law, including the obtaining of all Governmental Approvals, the failure with
which to comply could reasonably be expected to have a Material Adverse Effect, and (b) all terms
and conditions of each Material Contract the breach of which would permit the termination of such
Material Contract.



Section 7.3. Maintenance of Property.




     In addition to the requirements of any of the other Loan Documents, the Borrower shall, and
shall cause each Subsidiary and other Loan Party to, (a) protect and preserve all of its material
properties, including, but not limited to, all Intellectual Property, and maintain in good repair,
working order and condition all tangible properties, ordinary wear and tear excepted, and (b) make
or cause to be made all needed and appropriate repairs, renewals, replacements and additions to
such properties.



Section 7.4. Conduct of Business.




     The Borrower shall, and shall cause its Subsidiaries and the other Loan Parties to carry on,
their respective businesses as described in Section 6.1.(u).



Section 7.5. Insurance.




     In addition to the requirements of any of the other Loan Documents, the Borrower shall, and
shall cause each Subsidiary and other Loan Party to, maintain insurance (on a replacement cost
basis) with financially sound and reputable insurance companies against such risks and in such
amounts as is customarily maintained by public real estate companies engaged in similar businesses
as described in Section 6.1.(u). or as may be required by Applicable Law, and from time to time
deliver to the Agent upon its request a detailed list, together with copies of all policies of the
insurance then in effect, stating the names of the insurance companies, the amounts and rates of
the insurance, the dates of the expiration thereof and the properties and risks covered thereby.



Section 7.6. Payment of Taxes and Claims.




     The Borrower shall, and shall cause each Subsidiary and other Loan Party to, pay and discharge
when due (a) all taxes, assessments and governmental charges or levies imposed upon it or upon its
income or profits or upon any properties belonging to it, and (b) all lawful claims of materialmen,
mechanics, carriers, warehousemen and landlords for labor, materials, supplies and rentals which,
if unpaid, might become a Lien on any properties of such Person; provided, however, that this
Section shall not require the payment or discharge of any such tax, assessment, charge, levy or
claim which is being contested in good faith by appropriate proceedings which



- 62 -









 




operate to suspend the collection thereof and for which adequate reserves have been established on
the books of the Borrower, such Subsidiary or such other Loan Party, as applicable, in accordance
with GAAP.




Section 7.7. Visits and Inspections.




     The Borrower shall, and shall cause each Subsidiary and other Loan Party to, permit
representatives or agents of any Lender or the Agent, from time to time after reasonable prior
notice if no Event of Default exists, as often as may be reasonably requested, but only during
normal business hours and at the expense of such Lender or the Agent (unless a Default or Event of
Default shall exist, in which case the exercise by the Agent or such Lender of its rights under
this Section shall be at the expense of the Borrower), as the case may be, to: (a) visit and
inspect all properties of the Borrower or such Subsidiary or other Loan Party to the extent any
such right to visit or inspect is within the control of such Person; (b) inspect and make extracts
from their respective books and records, including but not limited to management letters prepared
by independent accountants, other than books and records subject to the attorney-client privilege
or confidentiality restrictions; and (c) discuss with its officers and employees, and its
independent accountants, its business, properties, condition (financial or otherwise), results of
operations and performance. If requested by the Agent, the Borrower shall execute an authorization
letter addressed to its accountants authorizing the Agent or any Lender to discuss the financial
affairs of the Borrower and any Subsidiary or any other Loan Party with its accountants.



Section 7.8. Use of Proceeds; Letters of Credit.




     The Borrower shall use the proceeds of all Loans and all Letters of Credit for general
corporate purposes only. No part of the proceeds of any Loan or Letter of Credit will be used (a)
for the purpose of buying or carrying “margin stock” within the meaning of Regulation U of the
Board of Governors of the Federal Reserve System or (b) fund any operations in, finance any
investments or activities in, or make any payments to, a Sanctioned Person or Sanctioned Entity.



Section 7.9. Environmental Matters.



     The Borrower shall, and shall cause all of its Subsidiaries and the other Loan Parties to,
comply with all Environmental Laws the failure with which to comply could reasonably be expected to
have a Material Adverse Effect. If the Borrower, any Subsidiary or any other Loan Party shall (a)
receive notice that any violation of any Environmental Law may have been committed or is about to
be committed by such Person, (b) receive notice that any administrative or judicial complaint or
order has been filed or is about to be filed against the Borrower, any Subsidiary or any other Loan
Party alleging violations of any Environmental Law or requiring the Borrower, any Subsidiary or any
other Loan Party to take any action in connection with the release of Hazardous Materials or (c)
receive any notice from a Governmental Authority or private party alleging that the Borrower, any
Subsidiary or any other Loan Party may be liable or responsible for costs associated with a
response to or cleanup of a release of Hazardous Materials or any damages caused thereby, and the
matters referred to in such notices, individually or in the aggregate, could reasonably be expected
to have a Material Adverse Effect, the Borrower shall provide the Agent and each Lender with a copy
of such notice promptly, and in any event within 10 Business Days, after the receipt thereof by the
Borrower, any Subsidiary or any other Loan



- 63 -









 




Party. The Borrower shall, and shall cause its Subsidiaries and the other Loan Parties to, take
promptly all actions necessary to prevent the imposition of any Liens on any of their respective
properties arising out of or related to any Environmental Laws.




Section 7.10. Books and Records.




     The Borrower shall, and shall cause each of its Subsidiaries and the other Loan Parties to,
maintain books and records pertaining to its respective business operations in such detail, form
and scope as is consistent with good business practice and in accordance with GAAP.



Section 7.11. Further Assurances.




     The Borrower shall, at the Borrower’s cost and expense and upon request of the Agent, execute
and deliver or cause to be executed and delivered, to the Agent such further instruments, documents
and certificates, and do and cause to be done such further acts that may be reasonably necessary or
advisable in the reasonable opinion of the Agent to carry out more effectively the provisions and
purposes of this Agreement and the other Loan Documents.



Section 7.12. New Subsidiaries/Guarantors.




     (a) Requirement to Become Guarantor. Within 45 days of any Person (other than an
Excluded Subsidiary) becoming a Material Subsidiary after the Effective Date, the Borrower shall
deliver to the Agent each of the following items, each in form and substance satisfactory to the
Agent: (i) an Accession Agreement executed by such Material Subsidiary and (ii) the items that
would have been delivered under Sections 5.1.(a)(iv), (ix) through (xii) and (xvi) if such Material
Subsidiary had been one on the Effective Date; provided, however, promptly (and in
any event within 30 days) upon any Excluded Subsidiary ceasing to be subject to the restriction
which prevented it from becoming a Guarantor on the Effective Date or delivering an Accession
Agreement pursuant to this Section, as the case may be, such Subsidiary shall comply with the
provisions of this Section. The Borrower shall send to each Lender copies of each of the foregoing
items once the Agent has received all such items with respect to a Material Subsidiary.



     (b) Other Guarantors. The Borrower may, at its option, cause any Subsidiary that is
not already a Guarantor to become a Guarantor by executing and delivering to the Agent the items
required to be delivered under the immediately preceding subsection (a).



     (c) Release of a Guarantor. The Borrower may request in writing that the Agent
release, and upon receipt of such request the Agent shall release, a Guarantor from the Guaranty so
long as: (i) such Guarantor meets, or will meet simultaneously with its release from the Guaranty,
all of the provisions of the definition of the term “Excluded Subsidiary” or has ceased to be, or
simultaneously with its release from the Guaranty will cease to be, a Material Subsidiary; (ii)
such Guarantor is not otherwise required to be a party to the Guaranty under the immediately
preceding subsection (a); (iii) no Default or Event of Default shall then be in existence or would
occur as a result of such release, including without limitation, a Default or Event of Default
resulting from a violation of any of the covenants contained in Section 9.1.; (iv) the
representations and warranties made or deemed made by the Borrower and each other Loan Party in the
Loan Documents to which any of them is a party, shall be true and correct in



- 64 -









 




all material respects on and as of the date of such release with the same force and effect as if
made on and as of such date except to the extent that such representations and warranties expressly
relate solely to an earlier date (in which case such representations and warranties shall have been
true and correct in all material respects on and as of such earlier date) and except for changes in
factual circumstances not prohibited under the Loan Documents; and (v) the Agent shall have
received such written request at least 10 Business Days prior to the requested date of release.
Delivery by the Borrower to the Agent of any such request shall constitute a representation by the
Borrower that the matters set forth in the preceding sentence (both as of the date of the giving of
such request and as of the date of the effectiveness of such request) are true and correct with
respect to such request.




Section 7.13. REIT Status.




     The Borrower shall at all times maintain its status as a REIT.



Section 7.14. Exchange Listing.




     The Borrower shall maintain at least one class of common shares of the Borrower having trading
privileges on the New York Stock Exchange or the American Stock Exchange or which is the subject of
price quotations in the over-the-counter market as reported by the National Association of
Securities Dealers Automated Quotation System.



Article VIII. Information




     For so long as this Agreement is in effect, unless the Requisite Lenders (or, if required
pursuant to Section 12.6., all of the Lenders) shall otherwise consent in the manner set forth in
Section 12.6., the Borrower shall furnish to each Lender (or to the Agent if so provided below) at
its Lending Office:



Section 8.1. Quarterly Financial Statements.




     As soon as available and in any event within 60 days after the close of each of the first,
second and third fiscal quarters of the Borrower, the unaudited consolidated balance sheet of the
Borrower and its Subsidiaries as at the end of such period and the related unaudited consolidated
statements of income, shareholders’ equity and cash flows of the Borrower and its Subsidiaries for
such period, setting forth in each case in comparative form the figures as of the end of and for
the corresponding periods of the previous fiscal year, all of which shall be certified by the chief
financial officer of the Borrower, in his or her opinion, to present fairly, in accordance with
GAAP (provided that such statements shall not include footnotes and other presentation items) and
in all material respects, the consolidated financial position of the Borrower and its Subsidiaries
as at the date thereof and the results of operations for such period (subject to normal year-end
audit adjustments).



Section 8.2. Year-End Statements.




     Within 90 days after the end of each fiscal year of the Borrower, the audited consolidated
balance sheet of the Borrower and its Subsidiaries as at the end of such fiscal year and the
related



- 65 -









 




audited consolidated statements of income, shareholders’ equity and cash flows of the Borrower and
its Subsidiaries for such fiscal year, setting forth in comparative form the figures as at the end
of and for the previous fiscal year, all of which shall be certified by (a) the chief financial
officer of the Borrower, in his or her opinion, to present fairly, in accordance with GAAP and in
all material respects, the consolidated financial position of the Borrower and its Subsidiaries as
at the date thereof and the results of operations for such period and (b) independent certified
public accountants of recognized national standing, whose certificate shall be unqualified and who
shall have authorized the Borrower to deliver such financial statements and certification thereof
to the Agent and the Lenders pursuant to this Agreement.




Section 8.3. Compliance Certificate.




     At the time financial statements are furnished pursuant to Sections 8.1. and 8.2., a
certificate substantially in the form of Exhibit N (a “Compliance Certificate”) executed by the
chief financial officer, the treasurer or the senior vice president of finance of the Borrower: (a)
setting forth in reasonable detail as at the end of the accounting period covered by such
Compliance Certificate, the calculations required to establish whether or not the Borrower was in
compliance with the covenants contained in Sections 9.1. and 9.4. and (b) stating that, to the best
of his or her knowledge, after due inquiry, no Default or Event of Default exists, or, if such is
not the case, specifying such Default or Event of Default and its nature, when it occurred, whether
it is continuing and the steps being taken by the Borrower with respect to such event, condition or
failure. In addition, if the Agent or the Requisite Lenders reasonably believe that a Default or
Event of Default may exist or may be likely to occur, the Borrower shall deliver to the Agent
within 30 days of the Agent’s request a Compliance Certificate with respect to any other fiscal
month end; provided, that the Borrower shall not be required to provide a Compliance Certificate
pursuant to this sentence more than once during any fiscal quarter. Each Compliance Certificate
shall be accompanied by a reasonably detailed list of all assets included in calculations of Gross
Asset Value of the Unencumbered Pool and shall disclose which assets have been added or removed
from such calculation since the previous list delivered to the Agent.



Section 8.4. Other Information.




     (a) Securities Filings. Prompt notice of the filing of all registration statements
(excluding the exhibits thereto (unless requested by the Agent) and any registration statements on
Form S-8 or its equivalent), reports on Forms 10-K, 10-Q and 8-K (or their equivalents) and all
other periodic reports which the Borrower, any Subsidiary or any other Loan Party shall file with
the Securities and Exchange Commission (or any Governmental Authority substituted therefor) or any
national securities exchange;



     (b) Shareholder Information. Promptly upon the mailing thereof to the shareholders of
the Borrower generally, copies of all financial statements, reports and proxy statements so mailed
and promptly upon the issuance thereof copies of all press releases issued by the Borrower, any
Subsidiary or any other Loan Party (but only to the extent that such financial statements, reports
and proxy statements are not publicly available to the Agent and the Lenders);



- 66 -









 





     (c) ERISA. If and when any member of the ERISA Group (i) gives or is required to give
notice to the PBGC of any “reportable event” (as defined in Section 4043 of ERISA) with respect to
any Plan which might constitute grounds for a termination of such Plan under Title IV of ERISA, or
knows that the plan administrator of any Plan has given or is required to give notice of any such
reportable event, a copy of the notice of such reportable event given or required to be given to
the PBGC; (ii) receives notice of complete or partial withdrawal liability under Title IV of ERISA
or notice that any Multiemployer Plan is in reorganization, is insolvent or has been terminated, a
copy of such notice; (iii) receives notice from the PBGC under Title IV of ERISA of an intent to
terminate, impose liability (other than for premiums under Section 4007 of ERISA) in respect of, or
appoint a trustee to administer any Plan, a copy of such notice; (iv) applies for a waiver of the
minimum funding standard under Section 412 of the Internal Revenue Code, a copy of such
application; (v) gives notice of intent to terminate any Plan under Section 4041(c) of ERISA, a
copy of such notice and other information filed with the PBGC; (vi) gives notice of withdrawal from
any Plan pursuant to Section 4063 of ERISA, a copy of such notice; or (vii) fails to make any
payment or contribution to any Plan or Multiemployer Plan or in respect of any Benefit Arrangement
or makes any amendment to any Plan or Benefit Arrangement which has resulted or could result in the
imposition of a Lien or the posting of a bond or other security, a certificate of the chief
financial officer of the Borrower setting forth details as to such occurrence and the action, if
any, which the Borrower or applicable member of the ERISA Group is required or proposes to take;



     (d) Litigation. To the extent the Borrower or any Subsidiary is aware of the same,
prompt notice of the commencement of any proceeding or investigation by or before any Governmental
Authority and any action or proceeding in any court or other tribunal or before any arbitrator
against or in any other way relating adversely to, or adversely affecting, the Borrower or any
Subsidiary or any of their respective properties, assets or businesses which could reasonably be
expected to have a Material Adverse Effect, and prompt notice of the receipt of notice that any
United States income tax returns of the Borrower or any of its Subsidiaries are being audited;



     (e) Modification of Organizational Documents. A copy of any amendment adverse to the
interest of the Lenders to the articles of incorporation, bylaws, partnership agreement or other
similar organizational documents of the Borrower or any other Loan Party, promptly upon, and in any
event within 15 Business Days of, the effectiveness thereof;



     (f) Change of Management or Financial Condition. Prompt notice of any change in the
senior management of the Borrower, or any other Loan Party and any change in the business, assets,
liabilities, financial condition, results of operations or business prospects of the Borrower, any
Subsidiary or any other Loan Party which has had or could reasonably be expected to have a Material
Adverse Effect;



     (g) Default. Notice of the occurrence of any of the following promptly upon a
Responsible Officer of the Borrower obtaining knowledge thereof: (i) any Default or Event of
Default or (ii) any event which constitutes or which with the passage of time, the giving of
notice, or otherwise, would constitute a default or event of default by the Borrower, any



- 67 -









 




Subsidiary or any other Loan Party under any Material Contract to which any such Person is a party
or by which any such Person or any of its respective properties may be bound;




     (h) Notice of Violations of Law. Prompt notice if the Borrower, any Subsidiary or any
other Loan Party shall receive any notification from any Governmental Authority alleging a
violation of any Applicable Law or any inquiry which could reasonably be expected to have a
Material Adverse Effect;



     (i) Material Subsidiary. Prompt notice of any Person becoming a Material Subsidiary;




     (j) Material Asset Sales. Prompt notice of the sale, transfer or other disposition of
any material assets of the Borrower, any Subsidiary or any other Loan Party to any Person other
than the Borrower, any Subsidiary or any other Loan Party;



     (k) Material Contracts. Promptly upon entering into any Material Contract after the
Agreement Date, a copy to the Agent of such Material Contract (but only to the extent such Material
Contract is not publicly available to the Agent and the Lenders);



     (l) Patriot Act Information. From time to time and promptly upon each request,
information identifying the Borrower as a Lender may request in order to comply with the USA
Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)); and



     (m) Other Information. From time to time and promptly upon each request, such data,
certificates, reports, statements, opinions of counsel, documents or further information regarding
the business, assets, liabilities, financial condition, results of operations or business prospects
of the Borrower or any of its Subsidiaries as the Agent or any Lender may reasonably request.



Section 8.5. Electronic Delivery of Certain Information.




     (a) The Borrower may deliver documents, materials and other information required to be
delivered pursuant to Article VIII. (collectively, “Information”) in an electronic format
acceptable to the Agent by e-mailing any such Information to an e-mail address of the Agent as
specified to the Borrower by the Agent from time to time. The Agent shall promptly post such
Information on the Borrower’s behalf on an internet or intranet website to which each Lender and
the Agent has access, whether a commercial, third-party website (such as Intralinks or SyndTrak) or
a website sponsored by the Agent (the “Platform”). Such Information shall only be deemed to have
been delivered to the Lenders on the date on which such Information is so posted.



     (b) In addition, the Borrower may deliver Information required to be delivered pursuant to
Sections 8.1., 8.2., and 8.4.(a) and (b) by posting any such Information to the Borrower’s internet
website (as of the Agreement Date, www.udr.com). Any such Information provided in such manner
shall only be deemed to have been delivered to the Agent or a Lender (i) on the date on which the
Agent or such Lender, as applicable, receives notice from the Borrower that such Information has
been posted to the Borrower’s internet website and (ii) only



- 68 -









 




if such Information is publicly available without charge on such website. If for any reason, the
Agent or a Lender either did not receive such notice or after reasonable efforts was unable to
access such website, then the Agent or such Lender, as applicable, shall not be deemed to have
received such Information. In addition to any manner permitted by Section 12.1., the Borrower may
notify the Agent or a Lender that Information has been posted to such a website by causing an
e-mail notification to be sent to an e-mail address specified from time to time by the Agent or
such Lender, as applicable.




     (c) Notwithstanding anything in this Section to the contrary (i) the Borrower shall deliver
paper copies of Information to the Agent or any Lender that requests in a writing specifying the
applicable delivery instructions that the Borrower deliver such paper copies until a written
request to cease delivering paper copies is given to the Borrower by the Agent or such Lender and
(ii) in every instance the Borrower shall be required to provide to the Agent a paper original of
the Compliance Certificate required by Section 8.3.



     (d) The Borrower acknowledges and agrees that the Agent may make Information, as well as any
other written information, reports, data, certificates, documents, instruments, agreements and
other materials relating to the Borrower, any Subsidiary or any other Loan Party or any other
materials or matters relating to this Agreement, any of the other Loan Documents or any of the
transactions contemplated by the Loan Documents, in each case to the extent that the Agent’s
communication thereof to the Lenders is otherwise permitted hereunder (collectively, the
“Communications”) available to the Lenders by posting the same on the Platform. The Borrower
acknowledges that (i) the distribution of material through an electronic medium, such as the
Platform, is not necessarily secure and that there are confidentiality and other risks associated
with such distribution, (ii) the Platform is provided “as is” and “as available” and (iii) neither
the Agent nor any of its Affiliates warrants the accuracy, adequacy or completeness of the
Communications or the Platform and each expressly disclaims liability for errors or omissions in
the Communications or the Platform.



     (e) The Agent shall have no obligation to request the delivery or to maintain copies of any of
the Information or other materials referred to above, and in no event shall have any responsibility
to monitor compliance by the Borrower with any such requests. Each Lender shall be solely
responsible for requesting delivery to it or maintaining its copies of such Information or other
materials.



Section 8.6. Public/Private Information.




     As requested by the Agent, the Borrower will cooperate with the Agent in connection with the
publication of certain materials and/or information provided by or on behalf of the Borrower to the
Agent and the Lenders (collectively, “Information Materials”) pursuant to this Article and will
designate Information Materials (a) that are either available to the public or not material with
respect to the Borrower and its Subsidiaries or any of their respective securities for purposes of
United States federal and state securities laws, as “Public Information” and (b) that are not
Public Information as “Private Information”.



- 69 -









 





Article IX. Negative Covenants




     For so long as this Agreement is in effect, unless the Requisite Lenders (or, if required
pursuant to Section 12.6., all of the Lenders) shall otherwise consent in the manner set forth in
Section 12.6., the Borrower shall comply with the following covenants:



Section 9.1. Financial Covenants.




     The Borrower shall not permit:



     (a) Maximum Leverage Ratio. The ratio of (i) Consolidated Funded Debt to (ii) Gross
Asset Value, to exceed 0.60 to 1.0 at any time; provided, however, that if such ratio is greater
than 0.60 to 1.0 but less than 0.65 to 1.0, then such failure to comply with the foregoing covenant
shall not constitute a Default or Event of Default so long as such ratio ceases to exceed 0.60 to
1.00 within four consecutive fiscal quarters following the date such ratio first exceeded 0.60 to
1.00.



     (b) Minimum Fixed Charge Coverage Ratio. The ratio of (i) Consolidated Adjusted
EBITDA for the two fiscal quarter period of the Borrower most recently ending (annualized) to (ii)
Consolidated Total Fixed Charges for such period (annualized), to be less than 1.50 to 1.00 at the
end of any fiscal quarter.



     (c) Maximum Secured Debt. The ratio of (i) Consolidated Secured Debt to (ii) Gross
Asset Value, to be greater than 0.40 to 1.00 at any time.



     (d) Minimum Net Worth. Consolidated Adjusted Tangible Net Worth at any time to be
less than $1,200,000,000.



     (e) Minimum Unencumbered Pool Leverage Ratio. The ratio of (i) Gross Asset Value of
the Unencumbered Pool to (ii) Consolidated Unsecured Debt, to be less than 1.50 to 1.00 at the end
of any fiscal quarter.



Section 9.2. Restricted Payments.




     Subject to the following sentence, if a Default or Event of Default exists, the Borrower shall
not, and shall not permit any other member of the Consolidated Group to, declare or make any
Restricted Payment; provided, however, that: (a) Subsidiaries may pay Restricted
Payments to the Borrower or any other Subsidiary and (b) the Borrower may only declare or make cash
distributions to its shareholders during any fiscal year in an aggregate amount not to exceed the
minimum amount necessary for the Borrower to remain in compliance with Section 7.13. If a Default
or Event of Default specified in Section 10.1.(a), Section 10.1.(b), Section 10.1.(f) or Section
10.1.(g) shall exist, or if as a result of the occurrence of any other Event of Default any of the
Obligations have been accelerated pursuant to Section 10.2.(a), the Borrower shall not, and shall
not permit any other member of the Consolidated Group to, make any Restricted Payments to any
Person other than to the Borrower or any Subsidiary.




- 70 -










 





Section 9.3. Debt.




     The Borrower shall not, and shall not permit any Subsidiary or any other Loan Party to, incur,
assume, or otherwise become obligated in respect of any Debt after the Agreement Date if
immediately prior to the assumption, incurring or becoming obligated in respect thereof, or
immediately thereafter and after giving effect thereto, a Default or Event of Default is or would
be in existence, including without limitation, a Default or Event of Default resulting from a
violation of any of the covenants contained in Section 9.1.



Section 9.4. Certain Permitted Investments.




     The Borrower shall not, and shall not permit any Subsidiary to, make any Investment in or
otherwise own the following items which would cause the aggregate value of such holdings of the
Borrower and such other Subsidiaries to exceed 30.0% of Gross Asset Value at any time (or in the
case of promissory notes and marketable securities described in subsection (e) below to exceed
10.0% of Gross Asset Value at any time):



     (a) Investments in partnerships, joint ventures, Unconsolidated Affiliates, and other Persons
that, in each case, are not Subsidiaries, with the value thereof determined in a manner consistent
with the definition of Gross Asset Value or, if not contemplated under the definition of Gross
Asset Value, as determined in accordance with GAAP;



     (b) Development Properties valued at book value, Condominium Properties valued at their
Condominium Property Value, and Renovation Properties valued at their Renovation Property Value;



     (c) Properties that are developed but that are not Multifamily Properties, with value based on
the lower of cost or market price determined in accordance with GAAP;



     (d) raw land, valued at current book value;



     (e) promissory notes, including any secured by a Mortgage, payable solely to any member of the
Consolidated Group and the obligors of which are not Affiliates of the Borrower, and all marketable
securities, with value based on the lower of cost or market price determined in accordance with
GAAP; and



     (f) Investments in Multifamily REIT Preferred Interests; provided, however, such Investments
must be acquired or otherwise made in connection with the acquisition of a portfolio of Multifamily
Properties or a series of Multifamily Properties.



Section 9.5. Investments Generally.




     The Borrower shall not, and shall not permit any Subsidiary or other Loan Party to, directly
or indirectly, acquire, make or purchase any Investment, or permit any Investment of such Person to
be outstanding on and after the Agreement Date, other than the following:



- 71 -









 





     (a) Investments in Subsidiaries in existence on the Agreement Date and disclosed on Part I of
Schedule 6.1.(b);



     (b) Investments to acquire Equity Interests of a Subsidiary or any other Person who after
giving effect to such acquisition would be a Subsidiary, so long as in each case (i) immediately
prior to such Investment, and after giving effect thereto, no Default or Event of Default is or
would be in existence and (ii) if such Subsidiary is (or after giving effect to such Investment
would become) a Material Subsidiary, and is not an Excluded Subsidiary, the terms and conditions
set forth in Section 7.12. are satisfied;



     (c) Investments permitted under Section 9.4.;



     (d) Investments in Cash Equivalents;



     (e) intercompany Debt among the Borrower and its Wholly Owned Subsidiaries provided that such
Debt is permitted by the terms of Section 9.3.;



     (f) loans and advances to officers and employees for moving, entertainment, travel and other
similar expenses in the ordinary course of business consistent with past practices; and



     (g) any other Investment so long as immediately prior to making such Investment, and
immediately thereafter and after giving effect thereto, no Default or Event of Default is or would
be in existence.



Section 9.6. Liens; Negative Pledges; Other Matters.




     (a) The Borrower shall not, and shall not permit any Subsidiary or other Loan Party to,
create, assume, or incur any Lien (other than Permitted Liens) upon any of its properties, assets,
income or profits of any character whether now owned or hereafter acquired if immediately prior to
the creation, assumption or incurring of such Lien, or immediately thereafter, a Default or Event
of Default is or would be in existence, including without limitation, a Default or Event of Default
resulting from a violation of any of the covenants contained in Section 9.1.



     (b) The Borrower shall not, and shall not permit any Subsidiary or other Loan Party to, enter
into, assume or otherwise be bound by any Negative Pledge except for a Negative Pledge contained in
any agreement (i) evidencing Debt which the Borrower or such Subsidiary may create, incur, assume,
or permit or suffer to exist under Section 9.3.; (ii) which Debt is secured by a Lien permitted to
exist and (iii) which prohibits the creation of any other Lien on only the property securing such
Debt as of the date such agreement was entered into.



     (c) The Borrower shall not, and shall not permit any Subsidiary or other Loan Party to, create
or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction
of any kind on the ability of any Subsidiary (other than an Excluded Subsidiary) to: (i) pay
dividends or make any other distribution on any of such Subsidiary’s capital stock or other equity
interests owned by the Borrower or any Subsidiary; (ii) pay any Debt owed to the



- 72 -









 




Borrower or any
Subsidiary; (iii) make loans or advances to the Borrower or any Subsidiary; or (iv) transfer any of
its property or assets to the Borrower or any Subsidiary.




Section 9.7. Merger, Consolidation, Sales of Assets and Other Arrangements.




     The Borrower shall not, and shall not permit any Subsidiary or other Loan Party to: (i) enter
into any transaction of merger or consolidation; (ii) liquidate, wind up or dissolve itself (or
suffer any liquidation or dissolution); or (iii) convey, sell, lease, sublease, transfer or
otherwise dispose of, in one transaction or a series of transactions, all or any substantial part
of its business or assets, whether now owned or hereafter acquired; provided,
however, that:



     (a) any of the actions described in the immediately preceding clauses (i) through (iii) may be
taken with respect to any Subsidiary or any other Loan Party (other than the Borrower or an
Operating Partnership) so long as immediately prior to the taking of such action, and immediately
thereafter and after giving effect thereto, no Default or Event of Default is or would exist;
notwithstanding the foregoing, a Loan Party (other than the Borrower or an Operating Partnership)
may enter into a transaction of merger pursuant to which such Loan Party is not the survivor of
such merger only if (i) the Borrower shall have given the Agent and the Lenders at least 10
Business Days’ prior written notice of such merger, such notice to include a certification to the
effect that immediately after and after giving effect to such action, no Default or Event of
Default is or would be in existence; provided that if the survivor of such merger is (or is to
become) a Loan Party, then such notice and certification may be given within 5 Business Days after
the consummation of such merger; (ii) if the survivor entity is a Material Subsidiary (and not an
Excluded Subsidiary and not already a Loan Party), the Borrower complies with the requirements of
Section 7.12. within the time period provided in such Section; and (iii) such Loan Party and the
survivor entity each takes such other action and delivers such other documents, instruments,
opinions and agreements as the Agent may reasonably request;



     (b) the Borrower, its Subsidiaries and the other Loan Parties may lease and sublease their
respective assets, as lessor or sublessor (as the case may be), in the ordinary course of their
business;



     (c) a Person may merge with and into the Borrower or an Operating Partnership so long as (i)
the Borrower or such Operating Partnership, as applicable, is the survivor of such merger, (ii)
immediately prior to such merger, and immediately thereafter and after giving effect thereto, no
Default or Event of Default is or would be in existence, and (iii) the Borrower shall have given
the Agent and the Lenders at least 10 Business Days’ prior written notice of such merger, such
notice to include a certification as to the matters described in the immediately preceding clause
(ii) (except that such prior notice shall not be required in the case of the merger of a Subsidiary
with and into the Borrower); and



     (d) the Borrower and each Subsidiary may sell, transfer or dispose of assets among themselves.



- 73 -









 





Section 9.8. Fiscal Year.




     The Borrower shall not change its fiscal year from that in effect as of the Agreement Date.



Section 9.9. Modifications to Material Contracts.




     The Borrower shall not, and shall not permit any Subsidiary or other Loan Party to, enter into
any amendment or modification to any Material Contract which could reasonably be expected to have a
Material Adverse Effect.



Section 9.10. Modifications of Organizational Documents.




     The Borrower shall not, and shall not permit any Loan Party or other Subsidiary to, amend,
supplement, restate or otherwise modify its articles or certificate of incorporation, by-laws,
operating agreement, declaration of trust, partnership agreement or other applicable organizational
document if such amendment, supplement, restatement or other modification could reasonably be
expected to have a Material Adverse Effect.



Section 9.11. Transactions with Affiliates.




     The Borrower shall not, and shall not permit any of its Subsidiaries or any other Loan Party
to, permit to exist or enter into, any transaction (including the purchase, sale, lease or exchange
of any property or the rendering of any service) with any Affiliate of the Borrower (other than a
Loan Party or a Wholly Owned Subsidiary), except transactions in the ordinary course of and
pursuant to the reasonable requirements of the business of the Borrower or any of its Subsidiaries
and either (i) upon fair and reasonable terms which are no less favorable to the Borrower or such
Subsidiary than would be obtained in a comparable arm’s length transaction with a Person that is
not an Affiliate of the Borrower or (ii) constitute, without giving effect to subsection (i) of
this Section 9.11., an Investment permitted under Sections 9.4. and 9.5.



Section 9.12. ERISA Exemptions.




     The Borrower shall not, and shall not permit any Subsidiary to, permit any of its respective
assets to become or be deemed to be “plan assets” within the meaning of ERISA, the Internal Revenue
Code and the respective regulations promulgated thereunder.



Article X. Default




Section 10.1. Events of Default.




     Each of the following shall constitute an Event of Default, whatever the reason for such event
and whether it shall be voluntary or involuntary or be effected by operation of Applicable Law or
pursuant to any judgment or order of any Governmental Authority:



- 74 -









 





     (a) Default in Payment of Principal. The Borrower shall fail to pay when due (whether
upon demand, at maturity, by reason of acceleration or otherwise) the principal of any of the
Loans, or any Reimbursement Obligation.



     (b) Default in Payment of Interest and Other Obligations. The Borrower shall fail to
pay when due any interest on any of the Loans or any of the other payment Obligations owing by the
Borrower under this Agreement or any other Loan Document, or any other Loan Party shall fail to pay
when due any payment Obligation owing by such other Loan Party under any Loan Document to which it
is a party, and such failure shall continue for a period of 2 Business Days.



     (c) Default in Performance. (i) The Borrower shall fail to perform or observe any
term, covenant, condition or agreement contained in the second proviso of the second sentence of
Section 2.4.(b), in Section 5.3.(b), in Section 8.4.(g) or in Article IX. or (ii) the Borrower or
any other Loan Party shall fail to perform or observe any term, covenant, condition or agreement
contained in this Agreement or any other Loan Document to which it is a party and not otherwise
mentioned in this Section and in the case of this clause (ii) only, such failure shall continue for
a period of 30 days after the earlier of (x) the date upon which a Responsible Officer of the
Borrower or such Loan Party obtains knowledge of such failure or (y) the date upon which the
Borrower has received written notice of such failure from the Agent.



     (d) Misrepresentations. Any written statement, representation or warranty made or
deemed made by or on behalf of the Borrower or any other Loan Party under this Agreement or under
any other Loan Document, or any amendment hereto or thereto, or in any other writing or statement
at any time furnished or made or deemed made by or on behalf of the Borrower or any other Loan
Party to the Agent or any Lender, shall at any time prove to have been incorrect or misleading, in
light of the circumstances in which made or deemed made, in any material respect when furnished or
made or deemed made.



     (e) Debt Cross-Default.




     (i) The Borrower, any Subsidiary or any other Loan Party shall fail to pay when due and
payable the principal of, or interest on, any Debt (other than the Loans and other than
Nonrecourse Indebtedness) having an aggregate outstanding principal amount of $50,000,000 or
more (“Material Debt”); or




     (ii) (x) the maturity of any Material Debt shall have been accelerated in accordance
with the provisions of any indenture, contract or instrument evidencing, providing for the
creation of or otherwise concerning such Material Debt or (y) any Material Debt shall have
been required to be prepaid or repurchased prior to the stated maturity thereof; or




     (iii) any other event shall have occurred and be continuing (and all applicable notice
and cure periods have lapsed), which would permit any holder or holders of Material Debt,
any trustee or agent acting on behalf of such holder or holders or any other
Person, to accelerate the maturity of any such Material Debt or require any such Material
Debt to be prepaid or repurchased prior to its stated maturity.



- 75 -









 





     (f) Voluntary Bankruptcy Proceeding. The Borrower, any other Loan Party or any
Subsidiary shall: (i) commence a voluntary case under the Bankruptcy Code of 1978, as amended, or
other federal bankruptcy laws (as now or hereafter in effect); (ii) file a petition seeking to take
advantage of any other Applicable Laws, domestic or foreign, relating to bankruptcy, insolvency,
reorganization, winding-up, or composition or adjustment of debts; (iii) consent to, or fail to
contest in a timely and appropriate manner, any petition filed against it in an involuntary case
under such bankruptcy laws or other Applicable Laws or consent to any proceeding or action
described in the immediately following subsection; (iv) apply for or consent to, or fail to contest
in a timely and appropriate manner, the appointment of, or the taking of possession by, a receiver,
custodian, trustee, or liquidator of itself or of a substantial part of its property, domestic or
foreign; (v) admit in writing its inability to pay its debts as they become due; (vi) make a
general assignment for the benefit of creditors; (vii) make a conveyance fraudulent as to creditors
under any Applicable Law; or (viii) take any corporate or partnership action for the purpose of
effecting any of the foregoing.



     (g) Involuntary Bankruptcy Proceeding. A case or other proceeding shall be commenced
against the Borrower, any other Loan Party or any Subsidiary in any court of competent jurisdiction
seeking: (i) relief under the Bankruptcy Code of 1978, as amended, or other federal bankruptcy
laws (as now or hereafter in effect) or under any other Applicable Laws, domestic or foreign,
relating to bankruptcy, insolvency, reorganization, winding-up, or composition or adjustment of
debts; or (ii) the appointment of a trustee, receiver, custodian, liquidator or the like of such
Person, or of all or any substantial part of the assets, domestic or foreign, of such Person, and
such case or proceeding shall continue undismissed or unstayed for a period of 60 consecutive
calendar days, or an order granting the remedy or other relief requested in such case or proceeding
against the Borrower, such Subsidiary or such other Loan Party (including, but not limited to, an
order for relief under such Bankruptcy Code or such other federal bankruptcy laws) shall be
entered.



     (h) Litigation; Enforceability. The Borrower or any other Loan Party shall disavow,
revoke or terminate (or attempt to terminate) any Loan Document to which it is a party or shall
otherwise challenge or contest in any action, suit or proceeding in any court or before any
Governmental Authority the validity or enforceability of this Agreement, any Note or any other Loan
Document or this Agreement, any Note, the Guaranty or any other Loan Document shall cease to be in
full force and effect (except as a result of the express terms thereof).



     (i) Judgment. A judgment or order for the payment of money or for an injunction shall
be entered against the Borrower, any Subsidiary or any other Loan Party, by any court or other
tribunal and (i) such judgment or order shall continue for a period of 30 days without being paid,
stayed or dismissed through appropriate appellate proceedings and (ii) either (A) the amount of
such judgment or order for which insurance has not been acknowledged in writing by the applicable
insurance carrier (or the amount as to which the insurer has denied liability) exceeds,
individually or together with all other such outstanding judgments or orders entered against the
Borrower, such Subsidiaries and such other Loan Parties, $10,000,000 or (B) in the
case of an injunction or other non-monetary judgment, such judgment could reasonably be expected to
have a Material Adverse Effect.



- 76 -









 





     (j) Attachment. A warrant, writ of attachment, execution or similar process shall be
issued against any property of the Borrower, any Subsidiary or any other Loan Party which exceeds,
individually or together with all other such warrants, writs, executions and processes, $10,000,000
in amount and such warrant, writ, execution or process shall not be discharged, vacated, stayed or
bonded for a period of 30 days; provided, however, that if a bond has been issued in favor of the
claimant or other Person obtaining such warrant, writ, execution or process, the issuer of such
bond shall execute a waiver or subordination agreement in form and substance satisfactory to the
Agent pursuant to which the issuer of such bond subordinates its right of reimbursement,
contribution or subrogation to the Obligations and waives or subordinates any Lien it may have on
the assets of any Loan Party.



     (k) ERISA. Any member of the ERISA Group shall fail to pay when due an amount or
amounts aggregating in excess of $10,000,000 which it shall have become liable to pay under Title
IV of ERISA; or notice of intent to terminate a Material Plan shall be filed under Title IV of
ERISA by any member of the ERISA Group, any plan administrator or any combination of the foregoing;
or the PBGC shall institute proceedings under Title IV of ERISA to terminate, to impose liability
(other than for premiums under Section 4007 of ERISA) in respect of, or to cause a trustee to be
appointed to administer, any Material Plan; or a condition shall exist by reason of which the PBGC
would be entitled to obtain a decree adjudicating that any Material Plan must be terminated; or
there shall occur a complete or partial withdrawal from, or a default, within the meaning of
Section 4219(c)(5) of ERISA, with respect to, one or more Multiemployer Plans which could cause one
or more members of the ERISA Group to incur a current payment obligation in excess of $10,000,000.



     (l) Loan Documents. An Event of Default (as defined therein) shall occur under any of
the other Loan Documents.



     (m) Change of Control. There shall occur a Change of Control.



Section 10.2. Remedies Upon Event of Default.




     Upon the occurrence of an Event of Default the following provisions shall apply:



     (a) Acceleration; Termination of Facilities.




     (i) Automatic. Upon the occurrence of an Event of Default specified in
Sections 10.1.(f) or 10.1.(g), (A)(i) the principal of, and all accrued interest on, the
Loans and the Notes at the time outstanding, (ii) an amount equal to the Stated Amount of
all Letters of Credit outstanding as of the date of the occurrence of such Event of Default
for deposit into the Collateral Account pursuant to Section 10.5. and (iii) all of the other
Obligations of the Borrower, including, but not limited to, the other amounts owed to the
Lenders, the Swingline Lender and the Agent under this Agreement, the Notes or any of the
other Loan Documents shall become immediately and automatically due and payable by the
Borrower without presentment, demand, protest, or other notice of any kind, all of
which are expressly waived by the Borrower and (B) all of the Commitments, the obligation of
the Lenders to make Revolving Loans, the Swingline Commitment, the



- 77 -









 






obligation of the
Swingline Lender to make Swingline Loans, and the obligation of the Agent to issue Letters
of Credit hereunder, shall all immediately and automatically terminate.




     (ii) Optional. If any other Event of Default shall exist, the Agent shall, at
the direction of the Requisite Lenders: (A) declare (1) the principal of, and accrued
interest on, the Loans and the Notes at the time outstanding, (2) an amount equal to the
Stated Amount of all Letters of Credit outstanding as of the date of the occurrence of such
other Event of Default for deposit into the Collateral Account pursuant to Section 10.5. and
(3) all of the other Obligations, including, but not limited to, the other amounts owed to
the Lenders and the Agent under this Agreement, the Notes or any of the other Loan Documents
to be forthwith due and payable, whereupon the same shall immediately become due and payable
without presentment, demand, protest or other notice of any kind, all of which are expressly
waived by the Borrower and (B) terminate the Commitments, the Swingline Commitment and the
obligation of the Lenders to make Loans hereunder and the obligation of the Agent to issue
Letters of Credit hereunder.



     (b) Loan Documents. The Requisite Lenders may direct the Agent to, and the Agent if
so directed shall, exercise any and all of its rights under any and all of the other Loan
Documents.



     (c) Applicable Law. The Requisite Lenders may direct the Agent to, and the Agent if
so directed shall, exercise all other rights and remedies it may have under any Applicable Law.



     (d) Appointment of Receiver. To the extent permitted by Applicable Law, the Agent and
the Lenders shall be entitled to the appointment of a receiver for the assets and properties of the
Borrower and its Subsidiaries, without notice of any kind whatsoever and without regard to the
adequacy of any security for the Obligations or the solvency of any party bound for its payment, to
take possession of all or any portion of the business operations of the Borrower and its
Subsidiaries and to exercise such power as the court shall confer upon such receiver.



Section 10.3. Remedies Upon Default.




     Upon the occurrence of a Default specified in Sections 10.1.(f) or 10.1.(g), the Commitments
shall immediately and automatically terminate.



Section 10.4. Allocation of Proceeds.




     If an Event of Default shall exist and maturity of any of the Obligations has been
accelerated, all payments received by the Agent under any of the Loan Documents, in respect of any
principal of or interest on the Obligations or any other amounts payable by the Borrower hereunder
or thereunder, shall be applied in the following order and priority:




     (a) amounts due to the Agent and the Lenders in respect of fees and expenses due under
Section 12.2.;




     (b) payments of interest on Swingline Loans;



- 78 -









 






     (c) payments of interest on all other Loans and Reimbursement Obligations, to be
applied for the ratable benefit of the Lenders;




     (d) payments of principal of Swingline Loans;




     (e) payments of principal of all other Loans, Reimbursement Obligations and other
Letter of Credit Liabilities, to be applied for the ratable benefit of the Lenders;
provided, however, to the extent that any amounts available for distribution pursuant to
this subsection are attributable to the issued but undrawn amount of an outstanding Letter
of Credit, such amounts shall be paid to the Agent for deposit into the Collateral Account;




     (f) amounts due the Agent and the Lenders pursuant to Sections 11.7. and 12.9.;




     (g) payment of all other Obligations and other amounts due and owing by the Borrower
and the other Loan Parties under any of the Loan Documents, if any, to be applied for the
ratable benefit of the Lenders; and




     (h) any amount remaining after application as provided above, shall be paid to the
Borrower or whomever else may be legally entitled thereto.



Section 10.5. Collateral Account.




     (a) As collateral security for the prompt payment in full when due of all Letter of Credit
Liabilities and the other Obligations, the Borrower hereby pledges and grants to the Agent, for the
ratable benefit of the Agent and the Lenders as provided herein, a security interest in all of its
right, title and interest in and to the Collateral Account and the balances from time to time in
the Collateral Account (including the investments and reinvestments therein provided for below).
The balances from time to time in the Collateral Account shall not constitute payment of any Letter
of Credit Liabilities until applied by the Agent as provided herein. Anything in this Agreement to
the contrary notwithstanding, funds held in the Collateral Account shall be subject to withdrawal
only as provided in this Section.



     (b) Amounts on deposit in the Collateral Account shall be invested and reinvested by the Agent
in such Cash Equivalents as the Agent shall determine in its sole discretion. All such investments
and reinvestments shall be held in the name of and be under the sole dominion and control of the
Agent for the ratable benefit of the Lenders. The Agent shall exercise reasonable care in the
custody and preservation of any funds held in the Collateral Account and shall be deemed to have
exercised such care if such funds are accorded treatment substantially equivalent to that which the
Agent accords other funds deposited with the Agent, it being understood that the Agent shall not
have any responsibility for taking any necessary steps to preserve rights against any parties with
respect to any funds held in the Collateral Account.



     (c) If a drawing pursuant to any Letter of Credit occurs on or prior to the expiration date of
such Letter of Credit, the Borrower and the Lenders authorize the Agent to use the



- 79 -









 




monies deposited
in the Collateral Account and proceeds thereof to make payment to the beneficiary with respect to
such drawing or the payee with respect to such presentment.




     (d) If an Event of Default exists, the Requisite Lenders may, in their discretion, at any time
and from time to time, instruct the Agent to liquidate any such investments and reinvestments and
apply proceeds thereof to the Obligations in accordance with Section 10.4.



     (e) So long as no Default or Event of Default exists, and to the extent amounts on deposit in
or credited to the Collateral Account exceed the aggregate amount of the Letter of Credit
Liabilities then due and owing, the Agent shall, from time to time, at the request of the Borrower,
deliver to the Borrower within 10 Business Days after the Agent’s receipt of such request from the
Borrower, against receipt but without any recourse, warranty or representation whatsoever, such
amount of the credit balances in the Collateral Account as exceeds the aggregate amount of the
Letter of Credit Liabilities at such time.



     (f) The Borrower shall pay to the Agent from time to time such fees as the Agent normally
charges for similar services in connection with the Agent’s administration of the Collateral
Account and investments and reinvestments of funds therein.



Section 10.6. Performance by Agent.




     If the Borrower shall fail to perform any covenant, duty or agreement contained in any of the
Loan Documents, the Agent may perform or attempt to perform such covenant, duty or agreement on
behalf of the Borrower after the expiration of any cure or grace periods set forth herein. In such
event, the Borrower shall, at the request of the Agent, promptly pay any amount reasonably expended
by the Agent in such performance or attempted performance to the Agent, together with interest
thereon at the applicable Post-Default Rate from the date of such expenditure until paid.
Notwithstanding the foregoing, neither the Agent nor any Lender shall have any liability or
responsibility whatsoever for the performance of any obligation of the Borrower under this
Agreement or any other Loan Document.



Section 10.7. Rights Cumulative.




     The rights and remedies of the Agent and the Lenders under this Agreement and each of the
other Loan Documents shall be cumulative and not exclusive of any rights or remedies which any of
them may otherwise have under Applicable Law. In exercising their respective rights and remedies
the Agent and the Lenders may be selective and no failure or delay by the Agent or any of the
Lenders in exercising any right shall operate as a waiver of it, nor shall any single or partial
exercise of any power or right preclude its other or further exercise or the exercise of any other
power or right.



- 80 -









 





Article XI. The Agent




Section 11.1. Authorization and Action.




     Each Lender hereby appoints and authorizes the Agent to take such action as contractual
representative on such Lender’s behalf and to exercise such powers under this Agreement and the
other Loan Documents as are specifically delegated to the Agent by the terms hereof and thereof,
together with such powers as are reasonably incidental thereto. Not in limitation of the
foregoing, each Lender authorizes and directs the Agent to enter into the Loan Documents for the
benefit of the Lenders. Each Lender hereby agrees that, except as otherwise set forth herein, any
action taken by the Requisite Lenders in accordance with the provisions of this Agreement or the
Loan Documents, and the exercise by the Requisite Lenders of the powers set forth herein or
therein, together with such other powers as are reasonably incidental thereto, shall be authorized
and binding upon all of the Lenders. Nothing herein shall be construed to deem the Agent a trustee
or fiduciary for any Lender nor to impose on the Agent duties or obligations other than those
expressly provided for herein. At the request of a Lender, the Agent will forward to such Lender
copies or, where appropriate, originals of the documents delivered to the Agent pursuant to this
Agreement or the other Loan Documents. The Agent will also furnish to any Lender, upon the request
of such Lender, a copy of any certificate or notice furnished to the Agent by the Borrower, any
Loan Party or any other Affiliate of the Borrower, pursuant to this Agreement or any other Loan
Document not already delivered to such Lender pursuant to the terms of this Agreement or any such
other Loan Document. As to any matters not expressly provided for by the Loan Documents
(including, without limitation, enforcement or collection of any of the Obligations), the Agent
shall not be required to exercise any discretion or take any action, but shall be required to act
or to refrain from acting (and shall be fully protected in so acting or refraining from acting)
upon the instructions of the Requisite Lenders (or all of the Lenders if explicitly required under
any other provision of this Agreement), and such instructions shall be binding upon all Lenders and
all holders of any of the Obligations; provided, however, that, notwithstanding anything in this
Agreement to the contrary, the Agent shall not be required to take any action which exposes the
Agent to personal liability or which is contrary to this Agreement or any other Loan Document or
Applicable Law. Not in limitation of the foregoing, the Agent shall not exercise any right or
remedy it or the Lenders may have under any Loan Document upon the occurrence of a Default or an
Event of Default unless the Requisite Lenders (or all of the Lenders if explicitly required under
any provision of this Agreement) have so directed the Agent to exercise such right or remedy.



Section 11.2. Agent’s Reliance, Etc.




     Notwithstanding any other provisions of this Agreement or any other Loan Documents, neither
the Agent nor any of its directors, officers, agents, employees or counsel shall be liable for any
action taken or omitted to be taken by it or them under or in connection with this Agreement or any
other Loan Document, except for its or their own gross negligence or willful misconduct as
determined by a court of competent jurisdiction in a final, non-appealable judgment. Without
limiting the generality of the foregoing, the Agent: (a) may treat the payee of any Note as the
holder thereof until the Agent receives written notice of the assignment or transfer thereof signed
by such payee and in form satisfactory to the Agent; (b) may consult with legal counsel (including
its own counsel or counsel for the Borrower or any other Loan Party),



- 81 -









 




independent public accountants and other experts selected by it and shall not be liable for any
action taken or omitted to be taken in good faith by it in accordance with the advice of such
counsel, accountants or experts; (c) makes no warranty or representation to any Lender or any other
Person and shall not be responsible to any Lender or any other Person for any statements,
warranties or representations made by any Person in or in connection with this Agreement or any
other Loan Document; (d) shall not have any duty to ascertain or to inquire as to the performance
or observance of any of the terms, covenants or conditions of any of this Agreement or any other
Loan Document or the satisfaction of any conditions precedent under this Agreement or any Loan
Document on the part of the Borrower or other Persons or inspect the property, books or records of
the Borrower or any other Person; (e) shall not be responsible to any Lender for the due execution,
legality, validity, enforceability, genuineness, sufficiency or value of this Agreement or any
other Loan Document, any other instrument or document furnished pursuant thereto or any collateral
covered thereby or the perfection or priority of any Lien in favor of the Agent on behalf of the
Lenders in any such collateral; and (f) shall incur no liability under or in respect of this
Agreement or any other Loan Document by acting upon any notice, consent, certificate or other
instrument or writing (which may be by telephone or telecopy) believed by it to be genuine and
signed, sent or given by the proper party or parties.




Section 11.3. Notice of Defaults.




     The Agent shall not be deemed to have knowledge or notice of the occurrence of a Default or
Event of Default unless the Agent has received notice from a Lender or the Borrower referring to
this Agreement, describing with reasonable specificity such Default or Event of Default and stating
that such notice is a “notice of default.” If any Lender (excluding the Lender which is also
serving as the Agent) becomes aware of any Default or Event of Default, it shall promptly send to
the Agent such a “notice of default.” Further, if the Agent receives such a “notice of default”,
the Agent shall give prompt notice thereof to the Lenders.



Section 11.4. Wachovia as Lender.




     Wachovia, as a Lender, shall have the same rights and powers under this Agreement and any
other Loan Document as any other Lender and may exercise the same as though it were not the Agent;
and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated, include Wachovia in
each case in its individual capacity. Wachovia and its Affiliates may each accept deposits from,
maintain deposits or credit balances for, invest in, lend money to, act as trustee under indentures
of, serve as financial advisor to, and generally engage in any kind of business with, the Borrower,
any other Loan Party or any other Affiliate thereof as if it were any other bank and without any
duty to account therefor to the other Lenders. Further, the Agent and any Affiliate may accept
fees and other consideration from the Borrower for services in connection with this Agreement and
otherwise without having to account for the same to the other Lenders. The Lenders acknowledge
that, pursuant to such activities, Wachovia or its Affiliates may receive information regarding the
Borrower, other Loan Parties, other Subsidiaries and other Affiliates of the Borrower (including
information that may be subject to confidentiality obligations in favor of such Person) and
acknowledge that the Agent shall be under no obligation to provide such information to them.



- 82 -









 





Section 11.5. Approvals of Lenders.




     All communications from the Agent to any Lender requesting such Lender’s determination,
consent, approval or disapproval (a) shall be given in the form of a written notice to such Lender,
(b) shall be accompanied by a description of the matter or issue as to which such determination,
approval, consent or disapproval is requested, or shall advise such Lender where information, if
any, regarding such matter or issue may be inspected, or shall otherwise describe the matter or
issue to be resolved, (c) shall include, if reasonably requested by such Lender and to the extent
not previously provided to such Lender, written materials and a summary of all oral information
provided to the Agent by the Borrower in respect of the matter or issue to be resolved, and (d)
shall include the Agent’s recommended course of action or determination in respect thereof. Each
Lender shall reply promptly, but in any event within 10 Business Days (or such lesser or greater
period as may be specifically required under the Loan Documents) after receipt of such
communication. Except as otherwise provided in this Agreement and except with respect to items
requiring the unanimous consent or approval of the Lenders under Section 12.6., unless a Lender
shall give written notice to the Agent that it specifically objects to the recommendation or
determination of the Agent (together with a written explanation of the reasons behind such
objection) within the applicable time period for reply, such Lender shall be deemed to have
conclusively approved of or consented to such recommendation or determination.



Section 11.6. Lender Credit Decision, Etc.




     Each Lender expressly acknowledges and agrees that neither the Agent, nor either Arranger, nor
any of their respective officers, directors, employees, agents, counsel, attorneys-in-fact or other
Affiliates has made any representations or warranties as to the financial condition, operations,
creditworthiness, solvency or other information concerning the business or affairs of the Borrower,
any other Loan Party, any Subsidiary or any other Person to such Lender and that no act by the
Agent or either Arranger hereafter taken, including any review of the affairs of the Borrower, any
other Loan Party or any other Subsidiary, shall be deemed to constitute any such representation or
warranty by the Agent or such Arranger to any Lender. Each Lender acknowledges that it has made
its own credit and legal analysis and decision to enter into this Agreement and the transactions
contemplated hereby, independently and without reliance upon the Agent, either Arranger, any other
Lender or counsel to the Agent or either Arranger, or any of their respective officers, directors,
employees and agents, and based on the financial statements of the Borrower, the Subsidiaries or
any other Affiliate thereof, and inquiries of such Persons, its independent due diligence of the
business and affairs of the Borrower, the Loan Parties, the Subsidiaries and other Persons, its
review of the Loan Documents, the legal opinions required to be delivered to it hereunder, the
advice of its own counsel and such other documents and information as it has deemed appropriate.
Each Lender also acknowledges that it will, independently and without reliance upon the Agent,
either Arranger, any other Lender or counsel to the Agent or either Arranger or any of their
respective officers, directors, employees and agents, and based on such review, advice, documents
and information as it shall deem appropriate at the time, continue to make its own decisions in
taking or not taking action under the Loan Documents. Except for notices, reports and other
documents and information expressly required to be furnished to the Lenders by the Agent or either
Arranger under this Agreement or any of the other Loan Documents, neither the Agent nor either
Arranger shall have any duty or



- 83 -









 




responsibility to provide any Lender with any credit or other information concerning the business,
operations, property, financial and other condition or creditworthiness of the Borrower, any other
Loan Party or any other Affiliate thereof which may come into possession of the Agent, either
Arranger or any of their respective officers, directors, employees, agents, attorneys-in-fact or
other Affiliates. Each Lender acknowledges that the Agent’s and each Arranger’s legal counsel in
connection with the transactions contemplated by this Agreement is only acting as counsel to the
Agent or such Arranger, respectively, and is not acting as counsel to such Lender.




Section 11.7. Indemnification of Agent and Arrangers.




     Each Lender agrees to indemnify the Agent and each Arranger (to the extent not reimbursed by
the Borrower and without limiting the obligation of the Borrower to do so) pro rata in accordance
with such Lender’s respective Commitment Percentage, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, reasonable out-of-pocket costs
and expenses, and disbursements of any kind or nature whatsoever which may at any time be imposed
on, incurred by, or asserted against the Agent (in its capacity as Agent but not as a Lender) or
either Arranger (in their capacity as Arranger but not as a Lender) in any way relating to or
arising out of the Loan Documents, any transaction contemplated hereby or thereby or any action
taken or omitted by the Agent or either Arranger under the Loan Documents (collectively,
“Indemnifiable Amounts”); provided, however, that no Lender shall be liable for any portion of such
Indemnifiable Amounts to the extent resulting from the Agent’s or such Arranger’s gross negligence
or willful misconduct as determined by a court of competent jurisdiction in a final, non-appealable
judgment or if the Agent or such Arranger fails to follow the written direction of the Requisite
Lenders (or all of the Lenders if expressly required hereunder) unless such failure results from
the Agent reasonably following the advice of counsel to the Agent of which advice the Lenders have
received notice. Without limiting the generality of the foregoing but subject to the preceding
proviso, each Lender agrees to reimburse the Agent or such Arranger, as the case may be (to the
extent not reimbursed by the Borrower and without limiting the obligation of the Borrower to do
so), promptly upon demand for its ratable share of any reasonable out-of-pocket expenses (including
counsel fees of the counsel(s) of the Agent’s or such Arranger’s own choosing) incurred by the
Agent or such Arranger in connection with the preparation, negotiation, execution, or enforcement
of, or legal advice with respect to the rights or responsibilities of the parties under, the Loan
Documents, any suit or action brought by the Agent or such Arranger to enforce the terms of the
Loan Documents and/or collect any Obligations, any “lender liability” suit or claim brought against
the Agent, the Arrangers and/or the Lenders, and any claim or suit brought against the Agent, the
Arrangers and/or the Lenders arising under any Environmental Laws. Such reasonable out-of-pocket
expenses (including counsel fees) shall be advanced by the Lenders on the request of the Agent or
such Arranger notwithstanding any claim or assertion that the Agent or such Arranger is not
entitled to indemnification hereunder upon receipt of an undertaking by the Agent or such Arranger
that the Agent or such Arranger will reimburse the Lenders if it is actually and finally determined
by a court of competent jurisdiction that the Agent or such Arranger is not so entitled to
indemnification. The agreements in this Section shall survive the payment of the Loans and all
other amounts payable hereunder or under the other Loan Documents and the termination of this
Agreement. If the Borrower shall reimburse the Agent or such Arranger for any Indemnifiable Amount
following payment by any Lender to the Agent or such Arranger in respect of such



- 84 -









 




Indemnifiable Amount pursuant to this Section, the Agent or such Arranger shall share such
reimbursement on a ratable basis with each Lender making any such payment.




Section 11.8. Successor Agent.




     The Agent may resign at any time as Agent under the Loan Documents by giving written notice
thereof to the Lenders and the Borrower. The Agent may be removed as Agent under the Loan
Documents for good cause by the Requisite Lenders upon 30 days’ prior notice. Upon any such
resignation or removal, the Requisite Lenders (other than the Lender then acting as Agent, in the
case of the removal of the Agent under the immediately preceding sentence) shall have the right to
appoint a successor Agent which appointment shall, provided no Default or Event of Default exists,
be subject to the Borrower’s approval, which approval shall not be unreasonably withheld or delayed
(except that the Borrower shall, in all events, be deemed to have approved each Lender and its
Affiliates as a successor Agent). If no successor Agent shall have been so appointed in accordance
with the immediately preceding sentence, and shall have accepted such appointment, within 30 days
after the resigning Agent’s giving of notice of resignation or the Lenders’ removal of the
resigning Agent, then the resigning or removed Agent may, on behalf of the Lenders, appoint a
successor Agent, which shall be a Lender, if any Lender shall be willing to serve, and otherwise
shall be a commercial bank having total combined assets of at least $50,000,000,000. Upon the
acceptance of any appointment as Agent hereunder by a successor Agent, such successor Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges and duties of the
retiring or removed Agent, and the retiring or removed Agent shall be discharged from its duties
and obligations under the Loan Documents. Such successor Agent shall issue letters of credit in
substitution for the Letters of Credit, if any, outstanding at the time of such succession or shall
make other arrangements satisfactory to the current Agent, in either case, to assume effectively
the obligations of the current Agent with respect to such Letters of Credit. After any Agent’s
resignation or removal hereunder as Agent, the provisions of this Article XI. shall continue to
inure to its benefit as to any actions taken or omitted to be taken by it while it was Agent under
the Loan Documents.



Section 11.9. Titled Agents.




     Each of the Titled Agents in each such respective capacity, assumes no responsibility or
obligation hereunder, including, without limitation, for servicing, enforcement or collection of
any of the Loans, nor any duties as an agent hereunder for the Lenders. The titles of “Joint Lead
Arranger”, “Joint Bookrunner”, “Syndication Agent”, and “Documentation Agent” are solely honorific
and imply no fiduciary responsibility on the part of the Titled Agents to the Agent, the Borrower
or any Lender and the use of such titles does not impose on the Titled Agents any duties or
obligations greater than those of any other Lender or entitle the Titled Agents to any rights other
than those to which any other Lender is entitled.



- 85 -









 





Article XII. Miscellaneous




Section 12.1. Notices.




     Unless otherwise provided herein, communications provided for hereunder shall be in writing
and shall be mailed, telecopied or delivered as follows:



     If to the Borrower:


UDR, Inc.

1745 Shea Center Drive, Suite 200

Highlands Ranch, Colorado 80129

Attn: Treasurer

Telephone: (720) 283-6142

Telecopy: (720) 283-2453




     with a copy to:


Morrison & Foerster LLP

5200 Republic Plaza

370 Seventeenth Street

Denver, Colorado 80202

Attn: Warren L. Troupe, Esq.

     David G. Thatcher, Esq.

Telephone: (303) 592-1500

Telecopy: (303) 592-1510




     If to the Agent:


Wachovia Bank, National Association

Wachovia Capital Markets, LLC

301 South College Street

16th Floor

Charlotte, NC 28288-0172

Attention: Amit Khimji

Telecopy Number: (704) 383-6205

Telephone Number: (704) 715-1347




     If to a Lender:


To such Lender’s address or telecopy number, as applicable, set forth in its

Administrative Details Form;



or, as to each party at such other address as shall be designated by such party in a written notice
to the other parties delivered in compliance with this Section. All such notices and other
communications shall be effective (i) if mailed, when received; (ii) if telecopied, when
transmitted; or (iii) if hand delivered or sent by overnight courier, when delivered.




- 86 -









 







Notwithstanding the immediately preceding sentence, all notices or communications to the Agent or
any Lender under Article II. shall be effective only when actually received. Neither the Agent nor
any Lender shall incur any liability to any Loan Party (nor shall the Agent incur any liability to
the Lenders) for acting upon any telephonic notice referred to in this Agreement which the Agent or
such Lender, as the case may be, believes in good faith to have been given by a Person authorized
to deliver such notice or for otherwise acting in good faith hereunder. Failure of a Person
designated to get a copy of a notice to receive such copy shall not affect the validity of notice
properly given to any other Person.




Section 12.2. Expenses.




     The Borrower agrees (a) to pay or reimburse the Agent and the Arrangers for all of their
respective reasonable out-of-pocket costs and expenses incurred in connection with the preparation,
negotiation and execution of, and any amendment, supplement or modification to, any of the Loan
Documents (including due diligence expenses and travel expenses relating to closing), and the
consummation of the transactions contemplated thereby, including the reasonable fees and
disbursements of counsel to the Agent and the Arrangers and costs and expenses in connection with
the use of IntraLinks, Inc., SyndTrak or other similar information transmission systems in
connection with the Loan Documents, (b) to pay or reimburse the Agent, the Arrangers and the
Lenders for all their costs and expenses incurred in connection with the enforcement or
preservation of any rights under the Loan Documents, including the reasonable fees and
disbursements of their respective counsel (including the allocated fees and expenses of in-house
counsel) and any payments in indemnification or otherwise payable by the Lenders to the Agent or
the Arrangers pursuant to the Loan Documents, (c) to pay, and indemnify and hold harmless the
Agent, the Arrangers and the Lenders from, any and all recording and filing fees and any and all
liabilities with respect to, or resulting from any failure to pay or delay in paying, documentary,
stamp, excise and other similar taxes, if any, which may be payable or determined to be payable in
connection with the execution and delivery of any of the Loan Documents, or consummation of any
amendment, supplement or modification of, or any waiver or consent under or in respect of, any Loan
Document and (d) to the extent not already covered by any of the preceding subsections, to pay or
reimburse the Agent, the Arrangers and the Lenders for all their costs and expenses incurred in
connection with any bankruptcy or other proceeding of the type described in Sections 10.1.(f) or
10.1.(g), including the reasonable fees and disbursements of counsel to the Agent, either Arranger
and any Lender, whether such fees and expenses are incurred prior to, during or after the
commencement of such proceeding or the confirmation or conclusion of any such proceeding. If the
Borrower shall fail to pay any amounts required to be paid by it pursuant to this Section, the
Agent, the Arrangers and/or the Lenders may pay such amounts on behalf of the Borrower and either
deem the same to be Loans outstanding hereunder or otherwise Obligations owing hereunder.



Section 12.3. Setoff.




     Subject to Section 3.3. and in addition to any rights now or hereafter granted under
Applicable Law and not by way of limitation of any such rights, the Agent, each Lender and each
Participant is hereby authorized by the Borrower, at any time or from time to time while an Event
of Default exists, without prior notice to the Borrower or to any other Person, any such notice
being hereby expressly waived, but in the case of a Lender or participant subject to receipt



- 87 -









 




of the prior written consent of the Agent exercised in its sole discretion, to set off and to
appropriate and to apply any and all deposits (general or special, including, but not limited to,
indebtedness evidenced by certificates of deposit, whether matured or unmatured) and any other
indebtedness at any time held or owing by the Agent, such Lender or any Affiliate of the Agent or
such Lender, to or for the credit or the account of the Borrower against and on account of any of
the Obligations, irrespective of whether or not any or all of the Loans and all other Obligations
have been declared to be, or have otherwise become, due and payable as permitted by Section 10.2.,
and although such obligations shall be contingent or unmatured.




Section 12.4. Litigation; Jurisdiction; Other Matters; Waivers.




     (a) EACH PARTY HERETO ACKNOWLEDGES THAT ANY DISPUTE OR CONTROVERSY BETWEEN OR AMONG THE
BORROWER, THE AGENT OR ANY OF THE LENDERS WOULD BE BASED ON DIFFICULT AND COMPLEX ISSUES OF LAW AND
FACT AND WOULD RESULT IN DELAY AND EXPENSE TO THE PARTIES. ACCORDINGLY, TO THE EXTENT PERMITTED BY
APPLICABLE LAW, EACH OF THE LENDERS, THE AGENT AND THE BORROWER HEREBY WAIVES ITS RIGHT TO A TRIAL
BY JURY IN ANY ACTION OR PROCEEDING OF ANY KIND OR NATURE IN ANY COURT OR TRIBUNAL IN WHICH AN
ACTION MAY BE COMMENCED BY OR AGAINST ANY PARTY HERETO ARISING OUT OF THIS AGREEMENT, THE NOTES, OR
ANY OTHER LOAN DOCUMENT OR BY REASON OF ANY OTHER SUIT, CAUSE OF ACTION OR DISPUTE WHATSOEVER
BETWEEN OR AMONG THE BORROWER, THE AGENT OR ANY OF THE LENDERS OF ANY KIND OR NATURE RELATING TO
ANY OF THE LOAN DOCUMENTS.



     (b) EACH OF THE BORROWER, THE AGENT AND EACH LENDER HEREBY AGREES THAT THE FEDERAL DISTRICT
COURT OF THE SOUTHERN DISTRICT OF NEW YORK AND ANY STATE COURT LOCATED IN NEW YORK, NEW YORK, SHALL
HAVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN OR AMONG THE BORROWER, THE
AGENT OR ANY OF THE LENDERS, PERTAINING DIRECTLY OR INDIRECTLY TO THIS AGREEMENT, THE LOANS AND
LETTERS OF CREDIT, THE NOTES OR ANY OTHER LOAN DOCUMENT OR TO ANY MATTER ARISING HEREFROM OR
THEREFROM. THE BORROWER AND EACH OF THE LENDERS EXPRESSLY SUBMIT AND CONSENT IN ADVANCE TO SUCH
JURISDICTION IN ANY ACTION OR PROCEEDING COMMENCED IN SUCH COURTS WITH RESPECT TO SUCH CLAIMS OR
DISPUTES. EACH PARTY FURTHER WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE
OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN
AN INCONVENIENT FORUM AND EACH AGREES NOT TO PLEAD OR CLAIM THE SAME. THE CHOICE OF FORUM SET
FORTH IN THIS SECTION SHALL NOT BE DEEMED TO PRECLUDE THE BRINGING OF ANY ACTION BY THE AGENT OR
ANY LENDER OR THE ENFORCEMENT BY THE AGENT OR ANY LENDER OF ANY JUDGMENT OBTAINED IN SUCH FORUM IN
ANY OTHER APPROPRIATE JURISDICTION.



     (c) THE PROVISIONS OF THIS SECTION HAVE BEEN CONSIDERED BY EACH PARTY WITH THE ADVICE OF
COUNSEL AND WITH A FULL



- 88 -









 




UNDERSTANDING OF THE LEGAL CONSEQUENCES THEREOF, AND SHALL SURVIVE THE PAYMENT OF THE LOANS AND ALL
OTHER AMOUNTS PAYABLE HEREUNDER OR UNDER THE OTHER LOAN DOCUMENTS, THE TERMINATION OR EXPIRATION OF
ALL LETTERS OF CREDIT AND THE TERMINATION OF THIS AGREEMENT.




Section 12.5. Successors and Assigns.




     (a) The provisions of this Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and permitted assigns, except that the Borrower may
not assign or otherwise transfer any of its rights or obligations under this Agreement without the
prior written consent of all Lenders and any such assignment or other transfer to which all of the
Lenders have not so consented shall be null and void.



     (b) Any Lender may make, carry or transfer Loans at, to or for the account of any of its
branch offices or the office of an Affiliate of such Lender except to the extent such transfer
would result in increased costs to the Borrower.



     (c) Any Lender may at any time grant to one or more banks or other financial institutions
(each a “Participant”) participating interests in its Commitment or the Obligations owing to such
Lender; provided, however, any such participating interest must be for a constant and not a varying
percentage interest. Except as otherwise provided in Section 12.3., no Participant shall have any
rights or benefits under this Agreement or any other Loan Document. A Participant shall not be
entitled to receive any greater payment under Section 3.12. than the applicable Lender would have
been entitled to receive with respect to the participation sold to such Participant, unless the
sale of the participation to such Participant is made with the Borrower’s prior written consent. A
Participant that is not organized under the laws of the United States of America, any state thereof
or of the District of Columbia shall not be entitled to the benefits of Section 3.12. unless the
Borrower is notified of the participation sold to such Participant and such Participant agrees, for
the benefit of the Borrower and the Agent, to comply with Section 3.12. (c) as though it were a
Lender. In the event of any such grant by a Lender of a participating interest to a Participant,
such Lender shall remain responsible for the performance of its obligations hereunder, and the
Borrower and the Agent shall continue to deal solely and directly with such Lender in connection
with such Lender’s rights and obligations under this Agreement. Any agreement pursuant to which
any Lender may grant such a participating interest shall provide that such Lender shall retain the
sole right and responsibility to enforce the obligations of the Borrower hereunder including,
without limitation, the right to approve any amendment, modification or waiver of any provision of
this Agreement; provided, however, such Lender may agree with the Participant that it will not,
without the consent of the Participant, agree to (i) increase, or extend the term or extend the
time or waive any requirement for the reduction or termination of, such Lender’s Commitment, (ii)
extend the date fixed for the payment of principal of or interest on the Loans or portions thereof
owing to such Lender, (iii) reduce the amount of any such payment of principal, (iv) reduce the
rate at which interest is payable thereon or (v) release any Guarantor (except as otherwise
permitted under Section 7.12.(c)). An assignment or other transfer which is not permitted by
subsection (d) or (e) below shall be given effect for purposes of this Agreement only to the extent
of a participating interest granted in accordance with this subsection (c). Upon request from the
Agent, the selling



- 89 -









 




Lender shall notify the Agent of the sale of any participation hereunder and, if requested by the
Agent, certify to the Agent that such participation is permitted hereunder and that the
requirements of Section 3.12.(c) have been satisfied.




     (d) Any Lender may with the prior written consent of the Agent and, so long as no Default or
Event of Default shall exist, the Borrower (which consent, in each case, shall not be unreasonably
withheld), assign to one or more Eligible Assignees (each an “Assignee”) all or a portion of its
Commitment and its other rights and obligations under this Agreement and the Notes; provided,
however, (i) no such consent by the Borrower shall be required in the case of any assignment to
another Lender or any Affiliate of such Lender or another Lender and no such consent by the Agent
shall be required in the case of any assignment by a Lender to any Affiliate of such Lender; (ii)
unless the Borrower and the Agent otherwise agree any partial assignment shall be in an amount at
least equal to $5,000,000 and integral multiples of $1,000,000 in excess thereof and after giving
effect to such assignment the assigning Lender retains a Commitment, or if the Commitments have
been terminated, holds Notes having an aggregate outstanding principal balance, of at least
$5,000,000 and integral multiples of $1,000,000 in excess thereof; provided, however, that the
limitations set forth in this clause (ii) shall not be applicable to any assignments in whole; and
(iii) each such assignment shall be effected by means of an Assignment and Acceptance Agreement.
Upon execution and delivery of such instrument and payment by such Assignee to such transferor
Lender of an amount equal to the purchase price agreed between such transferor Lender and such
Assignee, such Assignee shall be deemed to be a Lender party to this Agreement as of the effective
date of the Assignment and Acceptance Agreement and shall have all the rights and obligations of a
Lender with a Commitment as set forth in such Assignment and Acceptance Agreement, and the
transferor Lender shall be released from its obligations hereunder to a corresponding extent, and
no further consent or action by any party shall be required. Upon the consummation of any
assignment pursuant to this subsection (d), the transferor Lender, the Agent and the Borrower shall
make appropriate arrangements so that new Notes are issued to the Assignee and such transferor
Lender, as appropriate. In connection with any such assignment, the transferor Lender shall pay to
the Agent an administrative fee for processing such assignment in the amount of $5,000.



     (e) Any Lender (each, a “Designating Lender”) may at any time while the Borrower has been
assigned an Investment Grade Rating from either S&P or Moody’s designate one Designated Lender to
fund Bid Rate Loans on behalf of such Designating Lender subject to the terms of this subsection
(e) and the provisions in the immediately preceding subsections (c) and (d) shall not apply to such
designation. No Lender may designate more than one Designated Lender. The parties to each such
designation shall execute and deliver to the Agent for its acceptance a Designation Agreement.
Upon such receipt of an appropriately completed Designation Agreement executed by a Designating
Lender and a designee representing that it is a Designated Lender, the Agent will accept such
Designation Agreement and give prompt notice thereof to the Borrower, whereupon (i) the Borrower
shall execute and deliver to the Designating Lender a Designated Lender Note payable to the order
of the Designated Lender, (ii) from and after the effective date specified in the Designation
Agreement, the Designated Lender shall become a party to this Agreement with a right to make Bid
Rate Loans on behalf of its Designating Lender pursuant to Section 2.2. after the Borrower has
accepted a Bid Rate Loan (or portion thereof) of the Designating Lender, and (iii) the Designated
Lender shall not be required



- 90 -









 




to make payments with respect to any obligations in this Agreement except to the extent of excess
cash flow of such Designated Lender which is not otherwise required to repay obligations of such
Designated Lender which are then due and payable; provided, however, that regardless of such
designation and assumption by the Designated Lender, the Designating Lender shall be and remain
obligated to the Borrower, the Agent and the Lenders for each and every of the obligations of the
Designating Lender and its related Designated Lender with respect to this Agreement, including,
without limitation, any indemnification obligations under Section 11.7. and any sums otherwise
payable to the Borrower by the Designated Lender. Each Designating Lender shall serve as the
administrative agent of the Designated Lender and shall on behalf of, and to the exclusion of, the
Designated Lender: (i) receive any and all payments made for the benefit of the Designated Lender
and (ii) give and receive all communications and notices and take all actions hereunder, including,
without limitation, votes, approvals, waivers, consents and amendments under or relating to this
Agreement and the other Loan Documents. Any such notice, communication, vote, approval, waiver,
consent or amendment shall be signed by the Designating Lender as administrative agent for the
Designated Lender and shall not be signed by the Designated Lender on its own behalf and shall be
binding on the Designated Lender to the same extent as if signed by the Designated Lender on its
own behalf. The Borrower, the Agent and the Lenders may rely thereon without any requirement that
the Designated Lender sign or acknowledge the same. No Designated Lender may assign or transfer
all or any portion of its interest hereunder or under any other Loan Document, other than
assignments to the Designating Lender which originally designated such Designated Lender. The
Borrower, the Lenders and the Agent each hereby agrees that it will not institute against any
Designated Lender or join any other Person in instituting against any Designated Lender any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding under any federal or
state bankruptcy or similar law, until the later to occur of (x) one year and one day after the
payment in full of the latest maturing commercial paper note issued by such Designated Lender and
(y) the Termination Date.




     (f) The Agent shall maintain at the Principal Office a copy of each Assignment and Acceptance
Agreement delivered to and accepted by it and a register for the recordation of the names and
addresses of the Lenders and the Commitment of each Lender from time to time (the “Register”). The
Agent shall give each Lender and the Borrower notice of the assignment by any Lender of its rights
as contemplated by this Section. The Borrower, the Agent and the Lenders may treat each Person
whose name is recorded in the Register as a Lender hereunder for all purposes of this Agreement.
The Register and copies of each Assignment and Acceptance Agreement shall be available for
inspection by the Borrower or any Lender at any reasonable time and from time to time upon
reasonable prior notice to the Agent. Upon its receipt of an Assignment and Acceptance Agreement
executed by an assigning Lender, together with each Note subject to such assignment, the Agent
shall, if such Assignment and Acceptance Agreement has been completed and if the Agent receives the
processing and recording fee described in subsection (d) above, (i) accept such Assignment and
Acceptance Agreement, (ii) record the information contained therein in the Register and (iii) give
prompt notice thereof to the Borrower.



     (g) In addition to the assignments and participations permitted under the foregoing provisions
of this Section, any Lender may assign and pledge all or any portion of its Loans and



- 91 -









 




its Notes to any Federal Reserve Bank as collateral security pursuant to Regulation A and any
Operating Circular issued by such Federal Reserve Bank, and such Loans and Notes shall be fully
transferable as provided therein. No such assignment shall release the assigning Lender from its
obligations hereunder.




     (h) A Lender may furnish any information concerning the Borrower, any other Loan Party or any
of their respective Subsidiaries in the possession of such Lender from time to time to Assignees
and Participants (including prospective Assignees and Participants) subject to compliance with
Section 12.8.



     (i) Anything in this Section to the contrary notwithstanding, no Lender may assign or
participate any interest in any Loan held by it hereunder to the Borrower, any other Loan Party or
any of their respective Affiliates or Subsidiaries.



     (j) Each Lender agrees that, without the prior written consent of the Borrower and the Agent,
it will not make any assignment hereunder in any manner or under any circumstances that would
require registration or qualification of, or filings in respect of, any Loan or Note under the
Securities Act or any other securities laws of the United States of America or of any other
jurisdiction.



Section 12.6. Amendments.




     Except as otherwise expressly provided in this Agreement, any consent or approval required or
permitted by this Agreement or any other Loan Document to be given by the Lenders may be given, and
any term of this Agreement or of any other Loan Document may be amended, and the performance or
observance by the Borrower or any other Loan Party or any Subsidiary of any terms of this Agreement
or such other Loan Document or the continuance of any Default or Event of Default may be waived
(either generally or in a particular instance and either retroactively or prospectively) with, but
only with, the written consent of the Requisite Lenders (and, in the case of an amendment to any
Loan Document, the written consent of each Loan Party a party thereto). Notwithstanding the
foregoing, without the prior written consent of each Lender adversely affected thereby, no
amendment, waiver or consent shall, unless in writing, do any of the following: (i) reduce the
principal of, or interest that has accrued or the rates of interest that will be charged on the
outstanding principal amount of, any Loans or Fees or other Obligations; (ii) reduce the amount of
any Fees payable hereunder or postpone any date fixed for the payment thereof; (iii) modify the
definition of the term “Termination Date” or otherwise postpone any date fixed for any payment of
any principal of, or interest on, any Loans or any other Obligations (including the waiver of any
Default or Event of Default as a result of the nonpayment of any such Obligations as and when due),
or extend the expiration date of any Letter of Credit beyond the Termination Date; (iv) amend or
otherwise modify the provisions of Section 3.2.; (v) modify the definition of the term “Requisite
Lenders”, or modify in any other manner the number or percentage of the Lenders required to make
any determinations or waive any rights hereunder or to modify any provision hereof, including
without limitation, any modification of this Section 12.6. if such modification would have such
effect; (vi) release any Guarantor from its obligations under the Guaranty (except as otherwise
permitted under Section 7.12.(c)); (vii) increase the Commitments of the Lenders (except for any
increase in the Commitments effectuated pursuant to Section 2.15.) or subject the Lenders to any
additional



- 92 -









 




obligations; or (viii) amend or otherwise modify the provisions of Section 2.14.(a). Further, no
amendment, waiver or consent unless in writing and signed by the Agent, in addition to the Lenders
required hereinabove to take such action, shall affect the rights or duties of the Agent under this
Agreement or any of the other Loan Documents. Any amendment, waiver or consent relating to Section
2.3. or the obligations of the Swingline Lender under this Agreement or any other Loan Document
shall, in addition to the Lenders required hereinabove to take such action, require the written
consent of the Swingline Lender. No waiver shall extend to or affect any obligation not expressly
waived or impair any right consequent thereon and any amendment, waiver or consent shall be
effective only in the specific instance and for the specific purpose set forth therein. Except as
otherwise provided in Section 11.5., no course of dealing or delay or omission on the part of the
Agent or any Lender in exercising any right shall operate as a waiver thereof or otherwise be
prejudicial thereto. Any Event of Default occurring hereunder shall continue to exist until such
time as such Event of Default is waived in writing in accordance with the terms of this Section,
notwithstanding any attempted cure or other action by the Borrower, any other Loan Party or any
other Person subsequent to the occurrence of such Event of Default. Except as otherwise explicitly
provided for herein or in any other Loan Document, no notice to or demand upon the Borrower shall
entitle the Borrower to any other or further notice or demand in similar or other circumstances.




Section 12.7. Nonliability of Agent and Lenders.




     The relationship between the Borrower and the Lenders and the Agent shall be solely that of
borrower and lender. Neither the Agent nor any Lender shall have any fiduciary responsibilities to
the Borrower and no provision in this Agreement or in any of the other Loan Documents, and no
course of dealing between or among any of the parties hereto, shall be deemed to create any
fiduciary duty owing by the Agent or any Lender to any Lender, the Borrower, any Subsidiary or any
other Loan Party. Neither the Agent nor any Lender undertakes any responsibility to the Borrower
to review or inform the Borrower of any matter in connection with any phase of the Borrower’s
business or operations.



Section 12.8. Confidentiality.




     Each of the Agent and the Lenders agrees to maintain the confidentiality of the Information
(as defined below), except that Information may be disclosed (a) to its Affiliates and its
Affiliates’ respective partners, directors, officers, employees, agents, advisors and other
representatives (it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and instructed to keep such Information
confidential), (b) to the extent requested by, or required to be disclosed to, any nationally
recognized rating agency or regulatory or similar authority (including any self-regulatory
authority, such as the National Association of Insurance Commissioners) having or purporting to
have jurisdiction over it, (c) to the extent required by Applicable Laws or regulations or by any
subpoena or similar legal process, (d) to any other party hereto, (e) in connection with the
exercise of any remedies under any Loan Document or any action or proceeding relating to any Loan
Document or the enforcement of rights hereunder or thereunder, (f) subject to an agreement
containing provisions substantially the same as those of this Section, to (i) any actual or
proposed Assignee or Participant, or (ii) any actual or prospective counterparty (or its advisors)
to any swap or derivative transaction relating to the Borrower and its obligations, (g) with the
consent



- 93 -









 




of the Borrower, (h) to Gold Sheets and other similar bank trade publications, such information to
consist of deal terms and other information customarily found in such publications, and (i) to the
extent such Information (x) becomes publicly available other than as a result of a breach of this
Section actually known by the Agent or such Lender to be a breach of this Section or (y) becomes
available to the Agent, any Lender or any Affiliate of the Agent or any Lender on a nonconfidential
basis from a source other than the Borrower. Notwithstanding the foregoing, the Agent and each
Lender may disclose any such confidential information, without notice to the Borrower or any other
Loan Party, to Governmental Authorities in connection with any regulatory examination of the Agent
or such Lender or in accordance with the regulatory compliance policy of the Agent or such Lender.
As used in this Section, the term “Information” means all information received from the Borrower,
any other Loan Party or any Subsidiary or Affiliate of the Borrower relating to any Loan Party or
any of their respective businesses, other than any such information that is available to the Agent
or any Lender on a nonconfidential basis prior to disclosure by the Borrower, any other Loan Party
or any Subsidiary or Affiliate of the Borrower, provided that, in the case of any such information
received from the Borrower, any other Loan Party or any Subsidiary or Affiliate of the Borrower
after the date hereof, such information is clearly identified at the time of delivery as
confidential. Any Person required to maintain the confidentiality of Information as provided in
this Section shall be considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such Information as such
Person would accord to its own confidential information.




Section 12.9. Indemnification.




     (a) The Borrower shall and hereby agrees to indemnify, defend and hold harmless the Agent,
each of the Lenders, any Affiliate of the Agent or any Lender, and their respective directors,
officers, shareholders, agents, employees and counsel (each referred to herein as an “Indemnified
Party”) from and against any and all of the following (collectively, the “Indemnified Costs”):
losses, costs, claims, damages, liabilities, deficiencies, judgments or expenses of every kind and
nature (including, without limitation, amounts paid in settlement, court costs and the reasonable
fees and disbursements of counsel incurred in connection with any litigation, investigation, claim
or proceeding or any advice rendered in connection therewith, but excluding losses, costs, claims,
damages, liabilities, deficiencies, judgments or expenses indemnification in respect of which is
specifically covered by Section 3.12. or 4.1. or expressly excluded from the coverage of such
Sections 3.12. or 4.1.) incurred by an Indemnified Party in connection with, arising out of, or by
reason of, any suit, cause of action, claim, arbitration, investigation or settlement, consent
decree or other proceeding (the foregoing referred to herein as an “Indemnity Proceeding”) which is
in any way related directly or indirectly to: (i) this Agreement or any other Loan Document or the
transactions contemplated thereby; (ii) the making of any Loans or issuance of Letters of Credit
hereunder; (iii) any actual or proposed use by the Borrower of the proceeds of the Loans or Letters
of Credit; (iv) the Agent’s or any Lender’s entering into this Agreement; (v) the fact that the
Agent and the Lenders have established the credit facility evidenced hereby in favor of the
Borrower; (vi) the fact that the Agent and the Lenders are creditors of the Borrower and have or
are alleged to have information regarding the financial condition, strategic plans or business
operations of the Borrower and the Subsidiaries; (vii) the fact that the Agent and the Lenders are
material creditors of the Borrower and are alleged to influence directly or indirectly the business
decisions or affairs of the



- 94 -









 




Borrower and the Subsidiaries or their financial condition; (viii) the exercise of any right
or remedy the Agent or the Lenders may have under this Agreement or the other Loan Documents;
provided, however, that the Borrower shall not be obligated to indemnify any Indemnified Party for
any acts or omissions of such Indemnified Party in connection with matters described in this clause
(viii) that constitute gross negligence or willful misconduct; (ix) any civil penalty or fine
assessed by the OFAC against, and all reasonable costs and expenses (including counsel fees and
disbursements) incurred in connection with defense thereof by, the Agent or any Lender as a result
of conduct of the Borrower, any other Loan Party or any Subsidiary that violates a sanction
enforced by the OFAC; or (x) any violation or non-compliance by the Borrower or any Subsidiary of
any Applicable Law (including any Environmental Law) including, but not limited to, any Indemnity
Proceeding commenced by (A) the Internal Revenue Service or state taxing authority or (B) any
Governmental Authority or other Person under any Environmental Law, including any Indemnity
Proceeding commenced by a Governmental Authority or other Person seeking remedial or other action
to cause the Borrower or its Subsidiaries (or its respective properties) (or the Agent and/or the
Lenders as successors to the Borrower) to be in compliance with such Environmental Laws.




     (b) The Borrower’s indemnification obligations under this Section 12.9. shall apply to all
Indemnity Proceedings arising out of, or related to, the foregoing whether or not an Indemnified
Party is a named party in such Indemnity Proceeding. In this connection, this indemnification
shall cover all Indemnified Costs of any Indemnified Party in connection with any deposition of any
Indemnified Party or compliance with any subpoena (including any subpoena requesting the production
of documents). This indemnification shall, among other things, apply to any Indemnity Proceeding
commenced by other creditors of the Borrower or any Subsidiary, any shareholder of the Borrower or
any Subsidiary (whether such shareholder(s) are prosecuting such Indemnity Proceeding in their
individual capacity or derivatively on behalf of the Borrower), any account debtor of the Borrower
or any Subsidiary or by any Governmental Authority. If indemnification is to be sought
hereunder by an Indemnified Party, then such Indemnified Party shall notify the Borrower of the
commencement of any Indemnity Proceeding; provided, however, that the failure to so notify the
Borrower shall not relieve the Borrower from any liability that it may have to such Indemnified
Party pursuant to this Section 12.9.



     (c) This indemnification shall apply to any Indemnity Proceeding arising during the pendency
of any bankruptcy proceeding filed by or against the Borrower and/or any Subsidiary.



     (d) All out-of-pocket fees and expenses of, and all amounts paid to third-persons by, an
Indemnified Party shall be advanced by the Borrower at the request of such Indemnified Party
notwithstanding any claim or assertion by the Borrower that such Indemnified Party is not entitled
to indemnification hereunder upon receipt of an undertaking by such Indemnified Party that such
Indemnified Party will reimburse the Borrower if it is actually and finally determined by a court
of competent jurisdiction that such Indemnified Party is not so entitled to indemnification
hereunder.



     (e) Subject to Section 12.9.(f), an Indemnified Party may conduct its own investigation and
defense of, and may formulate its own strategy with respect to, any Indemnity Proceeding covered by
this Section 12.9. and, as provided above, all Indemnified Costs incurred



- 95 -









 




by such Indemnified Party shall be reimbursed by the Borrower. No action taken by legal counsel
chosen by an Indemnified Party in investigating or defending against any such Indemnity Proceeding
shall vitiate or in any way impair the obligations and duties of the Borrower hereunder to
indemnify and hold harmless each such Indemnified Party; provided, however, that (i) if the
Borrower is required to indemnify an Indemnified Party pursuant hereto and (ii) the Borrower has
provided evidence reasonably satisfactory to such Indemnified Party that the Borrower has the
financial wherewithal to reimburse such Indemnified Party for any amount paid by such Indemnified
Party with respect to such Indemnity Proceeding, such Indemnified Party shall not settle or
compromise any such Indemnity Proceeding without the prior written consent of the Borrower (which
consent shall not be unreasonably withheld or delayed). Notwithstanding the foregoing, an
Indemnified Party may settle or compromise any such Indemnity Proceeding without the prior written
consent of the Borrower where there is an allegation of a violation of law by such Indemnified
Party.




     (f) Notwithstanding the above, following the notification contemplated by Section 12.9.(b),
the Borrower may elect in writing to assume the defense of such action or proceeding, and, upon
such election, it shall not be liable for any legal costs subsequently incurred by such Indemnified
Party (other than reasonable costs of investigation and providing evidence) in connection
therewith, unless (i) the Borrower and the Indemnified Party have failed to agree in writing to the
retention of such counsel, (ii) the named parties to any such Indemnity Proceeding (including any
impleaded parties) include the Borrower and such Indemnified Party and representation of both
parties by the same counsel would, in the opinion of counsel to such Indemnified Party, be
inappropriate due to actual or potential conflicts of interests between the Borrower and such
Indemnified Party or (iii) the Indemnified Party reasonably determines that there may be legal
defenses available to it which are different from or in addition to those available to the
Borrower. The Borrower shall not settle, compromise, consent to the entry of judgment or otherwise
seek to terminate such Indemnity Proceeding without the consent of the Indemnified Party, which
consent shall not be unreasonably withheld.



     (g) If and to the extent that the obligations of the Borrower under this Section 12.9. are
unenforceable for any reason, the Borrower hereby agrees to make the maximum contribution to the
payment and satisfaction of such obligations which is permissible under Applicable Law.



     (h) The Borrower’s obligations under this Section 12.9. shall survive any termination of this
Agreement and the other Loan Documents and the payment in full in cash of the Obligations, and are
in addition to, and not in substitution of, any other of their obligations set forth in this
Agreement or any other Loan Document to which it is a party.



Section 12.10. Termination; Survival.




     At such time as (a) all of the Commitments have been terminated, (b) all Letters of Credit
(other than Letters of Credit the expiration dates of which extend beyond the Termination Date as
permitted under Section 2.4.(b) and in respect of which the Borrower has satisfied the requirements
of such Section) have terminated or expired, (c) none of the Lenders nor the Swingline Lender is
obligated any longer under this Agreement to make any Loans and (d) all Obligations (other than
obligations which survive as provided in the following sentence) have



- 96 -









 




been paid and satisfied in full, this Agreement shall terminate. The indemnities to which the
Agent, the Lenders and the Swingline Lender are entitled under the provisions of Sections 3.12.,
4.1., 4.4., 11.7., 12.2. and 12.9. and any other provision of this Agreement and the other Loan
Documents, and the provisions of Section 12.4., shall continue in full force and effect and shall
protect the Agent, the Lenders and the Swingline Lender (i) notwithstanding any termination of this
Agreement, or of the other Loan Documents, against events arising after such termination as well as
before and (ii) at all times after any such party ceases to be a party to this Agreement with
respect to all matters and events existing on or prior to the date such party ceased to be a party
to this Agreement.




Section 12.11. Severability of Provisions.




     Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective only to the extent of such prohibition or
unenforceability without invalidating the remainder of such provision or the remaining provisions
or affecting the validity or enforceability of such provision in any other jurisdiction.



Section 12.12. GOVERNING LAW.




     THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE
OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.



Section 12.13. Counterparts.




     This Agreement and any amendments, waivers, consents or supplements may be executed in any
number of counterparts and by different parties hereto in separate counterparts, each of which when
so executed and delivered shall be deemed an original, but all of which counterparts together shall
constitute but one and the same instrument.



Section 12.14. Obligations with Respect to Loan Parties.




     The obligations of the Borrower to direct or prohibit the taking of certain actions by the
other Loan Parties as specified herein shall be absolute and not subject to any defense the
Borrower may have that the Borrower does not control such Loan Parties.



Section 12.15. Limitation of Liability.




     Neither the Agent nor any Lender, nor any Affiliate, officer, director, employee, attorney, or
agent of the Agent or any Lender shall have any liability with respect to, and the Borrower hereby
waives, releases, and agrees not to sue any of them upon, any claim for any special, indirect,
incidental, or consequential damages suffered or incurred by the Borrower in connection with,
arising out of, or in any way related to, this Agreement or any of the other Loan Documents, or any
of the transactions contemplated by this Agreement or any of the other Loan Documents. The
Borrower hereby waives, releases, and agrees not to sue the Agent or any Lender or any of the
Agent’s or any Lender’s Affiliates, officers, directors, employees, attorneys, or agents for
punitive damages in respect of any claim in connection with, arising out of, or in




- 97 -









 




any way related to, this Agreement or any of the other Loan Documents, or any of the
transactions contemplated by this Agreement or financed hereby.



Section 12.16. Entire Agreement.




     This Agreement, the Notes, and the other Loan Documents referred to herein embody the final,
entire agreement among the parties hereto and supersede any and all prior commitments, agreements,
representations, and understandings, whether written or oral, relating to the subject matter hereof
and thereof and may not be contradicted or varied by evidence of prior, contemporaneous, or
subsequent oral agreements or discussions of the parties hereto. There are no oral agreements
among the parties hereto.


Section 12.17. Construction.




     The Agent, the Borrower and each Lender acknowledge that each of them has had the benefit of
legal counsel of its own choice and has been afforded an opportunity to review this Agreement and
the other Loan Documents with its legal counsel and that this Agreement and the other Loan
Documents shall be construed as if jointly drafted by the Agent, the Borrower and each Lender.


Section 12.18. Patriot Act.




     The Lenders and the Agent each hereby notifies the Borrower that pursuant to the requirements
of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)), it is
required to obtain, verify and record information that identifies the Borrower, which information
includes the name and address of the Borrower and other information that will allow such Lender or
the Agent, as applicable, to identify the Borrower in accordance with such Act.


Section 12.19. NO NOVATION.




     THE PARTIES HERETO HAVE ENTERED INTO THIS AGREEMENT SOLELY TO AMEND AND RESTATE THE TERMS OF
THE EXISTING CREDIT AGREEMENT. THE PARTIES DO NOT INTEND THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY TO BE, AND THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY SHALL NOT BE
CONSTRUED TO BE, A NOVATION OF ANY OF THE OBLIGATIONS OWING BY THE BORROWER UNDER OR IN CONNECTION
WITH THE EXISTING CREDIT AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS (AS DEFINED IN THE EXISTING
CREDIT AGREEMENT).



[Signatures on Following Pages]




 - 98 - 









 





     IN WITNESS WHEREOF, the parties hereto have caused this Second Amended and Restated Credit
Agreement to be executed by their authorized officers all as of the day and year first above
written.



	 	 	 	 	 
	 	UDR, INC., a Maryland corporation

 	 
	 	By:  	/s/ W. Mark Wallis
 	 
	 	 	Name:  	W. Mark Wallis 	 
	 	 	Title:  	Senior Executive Vice President 	 
	 



[Signatures Continued on Next Page]




 









 








[Signature Page to Second Amended and Restated Credit Agreement with UDR, Inc.]




	 	 	 	 	 
	 	WACHOVIA BANK, NATIONAL ASSOCIATION, as 

Agent, as a Lender and as Swingline Lender 

 	 
	 	By:  	

/s/ Cathy Casey
 	 
	 	 	Name:  	Cathy Casey 	 
	 	 	Title:  	Managing Director 	 
	 



[Signatures Continued on Next Page]





 









 





[Signature Page to Second Amended and Restated Credit Agreement with UDR, Inc.]




	 	 	 	 	 
	 	JPMORGAN CHASE BANK, N.A. 

 	 
	 	By:  	



/s/ Marc E. Constantino
 	 
	 	 	Name:  	Marc E. Constantino 	 
	 	 	Title:  	Executive Director 	 
	 



[Signatures Continued on Next Page]





 









 





[Signature Page to Second Amended and Restated Credit Agreement with UDR, Inc.]




	 	 	 	 	 
	 	SUNTRUST BANK

 	 
	 	By:  	/s/ Nancy B. Richards
 	 
	 	 	Name:  	Nancy B. Richards 	 
	 	 	Title:  	Senior Vice President 	 
	 



[Signatures Continued on Next Page]





 









 





[Signature Page to Second Amended and Restated Credit Agreement with UDR, Inc.]




	 	 	 	 	 
	 	U.S. BANK NATIONAL ASSOCIATION 

 	 
	 	By:  	/s/ Sandra Sauer
 	 
	 	 	Name:  	Sandra Sauer 	 
	 	 	Title:  	Vice President 	 
	 



[Signatures Continued on Next Page]





 









 





[Signature Page to Second Amended and Restated Credit Agreement with UDR, Inc.]




	 	 	 	 	 
	 	WELLS FARGO BANK, NATIONAL ASSOCIATION 

 	 
	 	By:  	/s/ J. Derek Evans
 	 
	 	 	Name:  	J. Derek Evans 	 
	 	 	Title:  	VP 	 
	 



[Signatures Continued on Next Page]





 









 





[Signature Page to Second Amended and Restated Credit Agreement with UDR, Inc.]




	 	 	 	 	 
	 	BANK OF AMERICA, N.A.

 	 
	 	By:  	/s/ Helen W. Chan
 	 
	 	 	Name:  	Helen W. Chan 	 
	 	 	Title:  	Assistant Vice President 	 
	 



[Signatures Continued on Next Page]





 









 





[Signature Page to Second Amended and Restated Credit Agreement with UDR, Inc.]




	 	 	 	 	 
	 	CITICORP NORTH AMERICA 

 	 
	 	By:  	/s/ Ricardo James
 	 
	 	 	Name:  	Ricardo James 	 
	 	 	Title:  	Director 	 
	 



[Signatures Continued on Next Page]





 









 





[Signature Page to Second Amended and Restated Credit Agreement with UDR, Inc.]




	 	 	 	 	 
	 	LASALLE BANK NATIONAL ASSOCIATION

 	 
	 	By:  	/s/ Brad Feine
 	 
	 	 	Name:  	Brad Feine 	 
	 	 	Title:  	Vice President 	 
	 



[Signatures Continued on Next Page]





 









 





[Signature Page to Second Amended and Restated Credit Agreement with UDR, Inc.]




	 	 	 	 	 
	 	MIZUHO CORPORATE BANK, LTD., NEW YORK BRANCH 

 	 
	 	By:  	/s/ Makoto Murata
 	 
	 	 	Name:  	Makoto Murata 	 
	 	 	Title:  	Deputy General Manager 	 
	 



[Signatures Continued on Next Page]





 









 





[Signature Page to Second Amended and Restated Credit Agreement with UDR, Inc.]




	 	 	 	 	 
	 	PNC BANK, NATIONAL ASSOCIATION

 	 
	 	By:  	/s/ James A. Harmann
 	 
	 	 	Name:  	James A. Harmann 	 
	 	 	Title:  	Vice President 	 
	 



[Signatures Continued on Next Page]





 









 





[Signature Page to Second Amended and Restated Credit Agreement with UDR, Inc.]




	 	 	 	 	 
	 	REGIONS BANK 

 	 
	 	By:  	/s/ Lori A. Chambers
 	 
	 	 	Name:  	Lori A. Chambers 	 
	 	 	Title:  	Vice President 	 
	 



[Signatures Continued on Next Page]





 









 





[Signature Page to Second Amended and Restated Credit Agreement with UDR, Inc.]




	 	 	 	 	 
	 	THE BANK OF TOKYO-MITSUBISHI UFJ, LTD. 

 	 
	 	By:  	/s/ James T. Taylor
 	 
	 	 	Name:  	James T. Taylor 	 
	 	 	Title:  	Vice President 	 
	 



[Signatures Continued on Next Page]





 









 





[Signature Page to Second Amended and Restated Credit Agreement with UDR, Inc.]




	 	 	 	 	 
	 	BANK OF CHINA, NEW YORK BRANCH 

 	 
	 	By:  	/s/ Richard Bradspies
 	 
	 	 	Name:  	Richard Bradspies 	 
	 	 	Title:  	Deputy General Manager 	 
	 



[Signatures Continued on Next Page]





 









 





[Signature Page to Second Amended and Restated Credit Agreement with UDR, Inc.]




	 	 	 	 	 
	 	CHEVY CHASE BANK, F.S.B.

 	 
	 	By:  	/s/ Carlos L. Heard
 	 
	 	 	Name:  	Carlos L. Heard 	 
	 	 	Title:  	Vice President 	 
	 



[Signatures Continued on Next Page]





 









 





[Signature Page to Second Amended and Restated Credit Agreement with UDR, Inc.]




	 	 	 	 	 
	 	COMERCIA BANK

 	 
	 	By:  	/s/ Leslie A. Vogel
 	 
	 	 	Name:  	Leslie A. Vogel 	 
	 	 	Title:  	Vice President 	 
	 



[Signatures Continued on Next Page]





 









 





[Signature Page to Second Amended and Restated Credit Agreement with UDR, Inc.]




	 	 	 	 	 
	 	MORGAN STANLEY BANK

 	 
	 	By:  	/s/ Daniel Twenge
 	 
	 	 	Name:  	Daniel Twenge 	 
	 	 	Title:  	Authorized Signatory 	 
	 



[Signatures Continued on Next Page]





 









 





[Signature Page to Second Amended and Restated Credit Agreement with UDR, Inc.]




	 	 	 	 	 
	 	UNION BANK OF CALIFORNIA, N.A.

 	 
	 	By:  	/s/ Lawrence Andow
 	 
	 	 	Name:  	Lawrence Andow 	 
	 	 	Title:  	Vice President 	 
	 



[Signatures Continued on Next Page]





 









 





SCHEDULE I




Commitments




	 	 	 	 	 
	Lender	 	Revolving Commitment
	Wachovia Bank, National Association
	 	$	50,000,000	 
	JPMorgan Chase Bank, N.A.
	 	$	50,000,000	 
	SunTrust Bank
	 	$	50,000,000	 
	U.S. Bank National Association
	 	$	50,000,000	 
	Wells Fargo Bank, National Association
	 	$	50,000,000	 
	Bank of America, N.A.
	 	$	35,000,000	 
	Citicorp North America
	 	$	35,000,000	 
	LaSalle Bank National Association
	 	$	35,000,000	 
	Mizuho Corporate Bank Ltd., New York Branch
	 	$	35,000,000	 
	PNC Bank, National Association
	 	$	35,000,000	 
	Regions Bank
	 	$	35,000,000	 
	The Bank of Tokyo-Mitsubishi UFJ, Ltd.
	 	$	35,000,000	 
	Bank of China, New York Branch
	 	$	25,000,000	 
	Chevy Chase Bank, F.S.B.
	 	$	20,000,000	 
	Comerica Bank
	 	$	20,000,000	 
	Morgan Stanley Bank
	 	$	20,000,000	 
	Union Bank of California, N.A.
	 	$	20,000,000	 
	TOTAL
	 	$	600,000,000	 
















 







EXHIBIT A




FORM OF ASSIGNMENT AND ACCEPTANCE AGREEMENT




     THIS ASSIGNMENT AND ACCEPTANCE AGREEMENT dated as of                     , 200___(the “Agreement”) by
and among                                          (the “Assignor”),                            
              (the “Assignee”),
and WACHOVIA BANK, NATIONAL ASSOCIATION, as Agent (the “Agent”).



     WHEREAS, the Assignor is a Lender under that certain Second Amended and Restated Credit
Agreement dated as of July ___, 2007 (as amended, restated, supplemented or otherwise modified from
time to time, the “Credit Agreement”), by and among UDR, Inc. (the “Borrower”), the financial
institutions party thereto and their assignees under Section 12.5 thereof (the “Lenders”), the
Agent, and the other parties thereto;



     WHEREAS, the Assignor desires to assign to the Assignee, among other things, all or a portion
of the Assignor’s Commitment under the Credit Agreement, all on the terms and conditions set forth
herein; and



     WHEREAS, the Agent consents to such assignment on the terms and conditions set forth herein;




     NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which
hereby are acknowledged by the parties hereto, the parties hereto hereby agree as follows:



     Section 1. Assignment.



     (a) Subject to the terms and conditions of this Agreement and in consideration of the payment
to be made by the Assignee to the Assignor pursuant to Section 2 of this Agreement, effective as of
                    , 200___(the “Assignment Date”), the Assignor hereby irrevocably sells, transfers and
assigns to the Assignee, without recourse, a $                     interest (such interest being the
“Assigned Commitment”) in and to the Assignor’s Commitment and all of the other rights and
obligations of the Assignor under the Credit Agreement, such Assignor’s Revolving Note and the
other Loan Documents (representing                     % in respect of the aggregate amount of all Lenders’
Commitments), including without limitation, a principal amount of outstanding Revolving Loans equal
to $                     and all voting rights of the Assignor associated with the Assigned Commitment, all
rights to receive interest on such amount of Revolving Loans and all commitment and other Fees with
respect to the Assigned Commitment and other rights of the Assignor under the Credit Agreement and
the other Loan Documents with respect to the Assigned Commitment, all as if the Assignee were an
original Lender under and signatory to the Credit Agreement having a Commitment equal to the amount
of the Assigned Commitment. The Assignee, subject to the terms and conditions hereof, hereby
assumes all obligations of the Assignor with respect to the Assigned Commitment as if the Assignee
were an original Lender under and signatory to the Credit Agreement having a Commitment equal to
the Assigned Commitment, which obligations shall include, but shall not be limited to, the
obligation
of the Assignor to make Revolving Loans to the Borrower with



A-1 









 




respect to the Assigned
Commitment, the obligation to pay the Agent amounts due in respect of draws under Letters of Credit
as required under Section 2.4(i) of the Credit Agreement and the obligation to indemnify the Agent
as provided therein (the foregoing enumerated obligations, together with all other similar
obligations more particularly set forth in the Credit Agreement and the other Loan Documents, shall
be referred to hereinafter, collectively, as the “Assigned Obligations”). [In addition, the
Assignor hereby irrevocably sells, transfers and assigns to the Assignee, without recourse, a
$                     interest in and to the Assignor’s Bid Rate Note, including without limitation, a
principal amount of outstanding Bid Rate Loans owing to the Assignor in an aggregate amount equal
to $                    , all rights to receive interest on such amount of Bid Rate Loans and other rights of
the Assignor under the Credit Agreement and the other Loan Documents with respect to such Bid Rate
Loans, all as if the Assignee had originally made such amount of Bid Rate Loans to the Borrower.
The obligations assigned pursuant to the immediately preceding sentence shall constitute Assigned
Obligations hereunder.] The Assignor shall have no further duties or obligations with respect to,
and shall have no further interest in, the Assigned Obligations or the Assigned Commitment from and
after the Assignment Date.




     (b) The assignment by the Assignor to the Assignee hereunder is without recourse to the
Assignor. The Assignee makes and confirms to the Agent, the Assignor, and the other Lenders all of
the representations, warranties and covenants of a Lender under Article XI. of the Credit
Agreement. Not in limitation of the foregoing, the Assignee acknowledges and agrees that, except
as set forth in Section 4 below, the Assignor is making no representations or warranties with
respect to, and the Assignee hereby releases and discharges the Assignor for any responsibility or
liability for: (i) the present or future solvency or financial condition of the Borrower, any
Subsidiary or any other Loan Party, (ii) any representations, warranties, statements or information
made or furnished by the Borrower, any Subsidiary or any other Loan Party in connection with the
Credit Agreement or otherwise, (iii) the validity, efficacy, sufficiency, or enforceability of the
Credit Agreement, any other Loan Document or any other document or instrument executed in
connection therewith, or the collectibility of the Assigned Obligations, (iv) the perfection,
priority or validity of any Lien with respect to any collateral at any time securing the
Obligations or the Assigned Obligations under the Notes or the Credit Agreement and (v) the
performance or failure to perform by the Borrower or any other Loan Party of any obligation under
the Credit Agreement or any other Loan Document to which it is a party. Further, the Assignee
acknowledges that it has, independently and without reliance upon the Agent, or on any affiliate or
subsidiary thereof, the Assignor or any other Lender and based on the financial statements supplied
by the Borrower and such other documents and information as it has deemed appropriate, made its own
credit and legal analysis and decision to become a Lender under the Credit Agreement. The Assignee
also acknowledges that it will, independently and without reliance upon the Agent, the Assignor or
any other Lender and based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action under the Credit
Agreement or any other Loan Documents or pursuant to any other obligation. Except as expressly
provided in the Credit Agreement, the Agent shall have no duty or responsibility whatsoever, either
initially or on a continuing basis, to provide the Assignee with any credit or other information
with respect to the Borrower or any other Loan Party or to notify the Assignee of any Default or
Event of Default. The Assignee has
not relied on the Agent as to any legal or factual matter in connection therewith or in
connection with the transactions contemplated thereunder.



A-2 









 





     Section 2. Payment by Assignee. In consideration of the assignment made pursuant to
Section 1 of this Agreement, the Assignee agrees to pay to the Assignor on the Assignment Date, an
amount equal to $                     representing (i) the aggregate principal amount outstanding of the Loans
owing to the Assignor under the Credit Agreement and the other Loan Documents being assigned hereby
plus (ii) the aggregate amount of payments previously made by Assignor under Section 2.4(j) of the
Credit Agreement which have not been repaid and which are being assigned hereby.



     Section 3. Payments by Assignor. The Assignor agrees to pay to the Agent on the
Assignment Date the administration fee, if any, payable under the applicable provisions of the
Credit Agreement.



     Section 4. Representations and Warranties of Assignor. The Assignor hereby
represents and warrants to the Assignee that (a) as of the Assignment Date (i) the Assignor is a
Lender under the Credit Agreement having a Commitment under the Credit Agreement [and the
outstanding principal balance of Bid Rate Loans owing to the Assignor] (without reduction by any
assignments thereof which have not yet become effective), equal to $                     [and $                    ,
respectively], and that the Assignor is not in default of its obligations under the Credit
Agreement; and (ii) the outstanding balance of Revolving Loans owing to the Assignor (without
reduction by any assignments thereof which have not yet become effective) is $                    ; and (b)
it is the legal and beneficial owner of the Assigned Commitment which is free and clear of any
adverse claim created by the Assignor.



     Section 5. Representations, Warranties and Agreements of Assignee. The Assignee (a)
represents and warrants that it is (i) legally authorized to enter into this Agreement, (ii) an
“accredited investor” (as such term is used in Regulation D of the Securities Act) and (iii) an
Eligible Assignee; (b) confirms that it has received a copy of the Credit Agreement, together with
copies of the most recent financial statements delivered in connection therewith or pursuant
thereto and such other documents and information (including without limitation the Loan Documents)
as it has deemed appropriate to make its own credit analysis and decision to enter into this
Agreement; (c) appoints and authorizes the Agent to take such action as contractual representative
on its behalf and to exercise such powers under the Loan Documents as are delegated to the Agent by
the terms thereof together with such powers as are reasonably incidental thereto; and (d) agrees
that, if not already a Lender and to the extent of the Assigned Commitment, it will become a party
to and shall be bound by the Credit Agreement and the other Loan Documents to which the other
Lenders are a party on the Assignment Date and will perform in accordance therewith all of the
obligations which are required to be performed by it as a Lender with respect to the Assigned
Commitment.



     Section 6. Recording and Acknowledgment by the Agent. Following the execution of
this Agreement, the Assignor will deliver to the Agent (a) a duly executed copy of this Agreement
for acknowledgment and recording by the Agent and (b) the Assignor’s Revolving Note [and Bid
Rate Note]. Upon such acknowledgment and recording, from and after the Assignment Date, the
Agent shall make all payments in respect of the interest assigned hereby (including payments of
principal, interest, Fees and other amounts) to the Assignee. The



A-3 









 





Assignor and Assignee shall make
all appropriate adjustments in payments under the Credit Agreement for periods prior to the
Assignment Date directly between themselves.




     Section 7. Addresses. The Assignee specifies as its address for notices and its
Lending Office for all Loans, the offices set forth below:



	 	 	 	 	 	 	 	 	 
	 

	 	Notice Address:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Telephone No.:	 	 	 	 
	 

	 	 	 	 	 	 

	 	 
	 

	 	 	 	Telecopy No.:	 	 	 	 
	 

	 	 	 	 	 	 

	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Lending Office:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Telephone No.:	 	 	 	 
	 

	 	 	 	 	 	 

	 	 
	 

	 	 	 	Telecopy No.:	 	 	 	 
	 

	 	 	 	 	 	 

	 	 






     Section 8. Payment Instructions. All payments to be made to the Assignee under this
Agreement by the Assignor, and all payments to be made to the Assignee under the Credit Agreement,
shall be made as provided in the Credit Agreement in accordance with the following instructions:



	 	 	 	 	 
	 

	 	 

	 	 
	 
	 	 	 	 
	 

	 	 

	 	 






     Section 9. Effectiveness of Assignment. This Agreement, and the assignment and
assumption contemplated herein, shall not be effective until (a) this Agreement is executed and
delivered by each of the Assignor, the Assignee, the Agent, and if required under Section 12.5.(d)
of the Credit Agreement, the Borrower, and (b) the payment to the Assignor of the amounts, if any,
owing by the Assignee pursuant to Section 2 hereof and (c) the payment to the Agent of the amounts,
if any, owing by the Assignor pursuant to Section 3 hereof. Upon recording and acknowledgment of
this Agreement by the Agent, from and after the Assignment Date, (i) the Assignee shall be a party
to the Credit Agreement and, to the extent provided in this Agreement, have the rights and
obligations of a Lender thereunder and (ii) the Assignor shall, to the extent provided in this
Agreement, relinquish its rights (except as otherwise provided in Section 12.10 of the Credit
Agreement) and be released from its obligations under the Credit Agreement; provided,
however, that if the Assignor does not assign its entire interest under the Loan Documents,
it shall remain a Lender entitled to all of the benefits and subject to all of the obligations
thereunder with respect to its Commitment.



     Section 10. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE
FULLY PERFORMED, IN SUCH STATE.



A-4 









 





     Section 11. Counterparts. This Agreement may be executed in any number of
counterparts each of which, when taken together, shall constitute one and the same agreement.



     Section 12. Headings. Section headings have been inserted herein for convenience
only and shall not be construed to be a part hereof.



     Section 13. Amendments; Waivers. This Agreement may not be amended, changed, waived
or modified except by a writing executed by the Assignee and the Assignor; provided,
however, any amendment, waiver or consent which shall affect the rights or duties of the
Agent under this Agreement shall not be effective unless signed by the Agent.



     Section 14. Entire Agreement. This Agreement embodies the entire agreement between
the Assignor and the Assignee with respect to the subject matter hereof and supersedes all other
prior arrangements and understandings relating to the subject matter hereof.



     Section 15. Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and permitted assigns.



     Section 16. Definitions. Terms not otherwise defined herein are used herein with the
respective meanings given them in the Credit Agreement.



     [Include this Section only if Borrower’s consent is required under Section 12.5.(d) Section
17. Agreements of the Borrower. The Borrower hereby agrees that the Assignee shall be a
Lender under the Credit Agreement having a Commitment equal to the Assigned Commitment. The
Borrower agrees that the Assignee shall have all of the rights and remedies of a Lender under the
Credit Agreement and the other Loan Documents as if the Assignee were an original Lender under and
signatory to the Credit Agreement, including, but not limited to, the right of a Lender to receive
payments of principal and interest with respect to the Assigned Obligations, and to the Revolving
Loans made by the Lenders after the date hereof and to receive the commitment and other Fees
payable to the Lenders as provided in the Credit Agreement. Further, the Assignee shall be
entitled to the indemnification provisions from the Borrower in favor of the Lenders as provided in
the Credit Agreement and the other Loan Documents. The Borrower further agrees, upon the execution
and delivery of this Agreement, to execute in favor of the Assignee, and if applicable the
Assignor, Notes as required by Section 12.5(d) of the Credit Agreement. Upon receipt by the
Assignor of the amounts due the Assignor under Section 2, the Assignor agrees to surrender to the
Borrower such Assignor’s Notes.]



[Signatures on Following Pages]




A-5 









 










     IN WITNESS WHEREOF, the parties hereto have duly executed this Assignment and Acceptance
Agreement as of the date and year first written above.



	 	 	 	 	 	 	 	 	 
	 	 	ASSIGNOR:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	[NAME OF ASSIGNOR]	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 

	 	 
	 

	 	 	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 

	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	ASSIGNEE:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	[NAME OF ASSIGNEE]	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	Title:
	 	 

	 	 
	 

	 	 	 	 	 	 

	 	 





[Include signature of the Borrower only

if required under Section 12.5.(d)
of 
the Credit Agreement]



Agreed and consented to as to Section 17

hereof of the date first written above.




BORROWER:




UDR, INC.




	 	 	 	 	 	 	 
	By:
	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:
	 	 

	 	 
	 

	 	 	 	 

	 	 






[Signatures Continued on Following Page]




A-6 









 





Accepted as of the date first written above.




AGENT:




WACHOVIA BANK, NATIONAL ASSOCIATION, as Agent




	 	 	 	 	 	 	 
	By:
	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:
	 	 

	 	 
	 

	 	 	 	 

	 	 







A-7 









 









EXHIBIT B




FORM OF DESIGNATION AGREEMENT




     THIS DESIGNATION AGREEMENT dated as of                     , ___(the “Agreement”) by and among
          
                               (the “Designating Lender”),                                   
       (the “Designated
Lender”) and Wachovia Bank, National Association, as Agent (the “Agent”).



     WHEREAS, the Designating Lender is a Lender under that certain Second Amended and Restated
Credit Agreement dated as of July ___, 2007 (as amended, restated, supplemented or otherwise
modified from time to time, the “Credit Agreement”), by and among UDR, Inc. (the “Borrower”), the
financial institutions party thereto and their assignees under Section 12.5 thereof (the
“Lenders”), the Agent, and the other parties thereto;



     WHEREAS, pursuant to Section 12.5(e) of the Credit Agreement, the Designating Lender desires
to designate the Designated Lender as its “Designated Lender” under and as defined in the Credit
Agreement; and



     WHEREAS, the Agent consents to such designation on the terms and conditions set forth herein.



     NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which
hereby are acknowledged by the parties hereto, the parties hereto hereby agree as follows:



     Section 1. Designation. Subject to the terms and conditions of this Agreement, the
Designating Lender hereby designates the Designated Lender, and the Designated Lender hereby
accepts such designation, to have a right to make Bid Rate Loans on behalf of the Designating
Lender pursuant to Section 2.2. of the Credit Agreement. Any assignment by the Designating Lender
to the Designated Lender of rights to make a Bid Rate Loan shall only be effective at the time such
Bid Rate Loan is funded by the Designated Lender. The Designated Lender, subject to the terms and
conditions hereof, hereby agrees to make such accepted Bid Rate Loans and to perform such other
obligations as may be required of it as a Designated Lender under the Credit Agreement.



     Section 2. Designating Lender Not Discharged. Notwithstanding the designation of the
Designated Lender hereunder, the Designating Lender shall be and remain obligated to the Borrower,
the Agent and the Lenders for each and every of the obligations of the Designating Lender and its
related Designated Lender with respect to the Credit Agreement and the other Loan Documents,
including, without limitation, any indemnification obligations under Section 11.7 of the Credit
Agreement and any sums otherwise payable to the Borrower by the Designated Lender.



     Section 3. No Representations by Designating Lender. The Designating Lender makes no
representation or warranty and, except as set forth in Section 8 below, assumes no



B-1 









 






responsibility
pursuant to this Agreement with respect to (a) any statements, warranties or representations made
in or in connection with any Loan Document or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of any Loan Document or any other instrument and document
furnished pursuant thereto and (b) the financial condition of the Borrower, any Subsidiary or any
other Loan Party or the performance or observance by the Borrower or any other Loan Party of any of
its respective obligations under any Loan Document to which it is a party or any other instrument
or document furnished pursuant thereto.




     Section 4. Representations and Covenants of Designated Lender. The Designated Lender
makes and confirms to the Agent, the Designating Lender, and the other Lenders all of the
representations, warranties and covenants of a Lender under Article XI of the Credit Agreement.
Not in limitation of the foregoing, the Designated Lender (a) represents and warrants that it (i)
is legally authorized to enter into this Agreement; (ii) is an “accredited investor” (as such term
is used in Regulation D of the Securities Act) and (iii) meets the requirements of a “Designated
Lender” contained in the definition of such term contained in the Credit Agreement; (b) confirms
that it has received a copy of the Credit Agreement, together with copies of the most recent
financial statements referred to therein or delivered pursuant thereto and such other documents and
information (including without limitation the Loan Documents) as it has deemed appropriate to make
its own credit analysis and decision to enter into this Agreement; (c) confirms that it has,
independently and without reliance upon the Agent, or any Affiliate thereof, the Designating Lender
or any other Lender and based on such financial statements and such other documents and
information, made its own credit and legal analysis and decision to become a Designated Lender
under the Credit Agreement; (d) appoints and authorizes the Agent to take such action as
contractual representative on its behalf and to exercise such powers under the Loan Documents as
are delegated to the Agent by the terms thereof together with such powers as are reasonably
incidental thereto; and (e) agrees that it will become a party to and shall be bound by the Credit
Agreement, the other Loan Documents to which the other Lenders are a party on the Effective Date
(as defined below) and will perform in accordance therewith all of the obligations which are
required to be performed by it as a Designated Lender. The Designated Lender also acknowledges
that it will, independently and without reliance upon the Agent, the Designating Lender or any
other Lender and based on such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under the Credit Agreement
or any Note or pursuant to any other obligation. The Designated Lender acknowledges and agrees
that except as expressly required under the Credit Agreement, the Agent shall have no duty or
responsibility whatsoever, either initially or on a continuing basis, to provide the Designated
Lender with any credit or other information with respect to the Borrower, any Subsidiary or any
other Loan Party or to notify the Designated Lender of any Default or Event of Default.



     Section 5. Appointment of Designating Lender as Attorney-In-Fact. The Designated
Lender hereby appoints the Designating Lender as the Designated Lender’s agent and
attorney-in-fact, and grants to the Designating Lender an irrevocable power of attorney, to receive
any and all payments to be made for the benefit of the Designated
Lender under the Credit
Agreement, to deliver and receive all notices and other communications under the Credit
Agreement and other Loan Documents and to exercise on the Designated Lender’s behalf all rights to
vote and to grant and make approvals, waivers, consents of amendments to or under the



B-2 









 




Credit
Agreement or other Loan Documents. Any document executed by the Designating Lender on the
Designated Lender’s behalf in connection with the Credit Agreement or other Loan Documents shall be
binding on the Designated Lender. Each of the Borrower, the Agent and each of the Lenders may rely
on and are beneficiaries of the preceding provisions.




     Section 6. Acceptance by the Agent. Following the execution of this Agreement by the
Designating Lender and the Designated Lender, the Designating Lender will (i) deliver to the Agent
a duly executed original of this Agreement for acceptance by the Agent and (ii) pay to the Agent
the fee, if any, payable under the applicable provisions of the Credit Agreement whereupon this
Agreement shall become effective as of the date of such acceptance or such other date as may be
specified on the signature page hereof (the “Effective Date”).



     Section 7. Effect of Designation. Upon such acceptance and recording by the Agent,
as of the Effective Date, the Designated Lender shall be a party to the Credit Agreement with a
right to make Bid Rate Loans as a Lender pursuant to Section 2.2. of the Credit Agreement and the
rights and obligations of a Lender related thereto; provided, however, that the
Designated Lender shall not be required to make payments with respect to such obligations except to
the extent of excess cash flow of the Designated Lender which is not otherwise required to repay
obligations of the Designated Lender which are then due and payable. Notwithstanding the
foregoing, the Designating Lender, as agent for the Designated Lender, shall be and remain
obligated to the Borrower, the Agent and the Lenders for each and every of the obligations of the
Designated Lender and the Designating Lender with respect to the Credit Agreement.



     Section 8. Indemnification of Designated Lender. The Designating Lender
unconditionally agrees to pay or reimburse the Designated Lender and save the Designated Lender
harmless against all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind or nature whatsoever which may be imposed or
asserted by any of the parties to the Loan Documents against the Designated Lender, in its capacity
as such, in any way relating to or arising out of this Agreement or any other Loan Documents or any
action taken or omitted by the Designated Lender hereunder or thereunder, provided that the
Designating Lender shall not be liable for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements if the same results
from the Designated Lender’s gross negligence or willful misconduct.



     Section 9. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE
FULLY PERFORMED, IN SUCH STATE.



     Section 10. Counterparts. This Agreement may be executed in any number of
counterparts each of which, when taken together, shall constitute one and the same agreement.



     Section 11. Headings. Section headings have been inserted herein for convenience
only and shall not be construed to be a part hereof.



B-3 









 





     Section 12. Amendments; Waivers. This Agreement may not be amended, changed, waived
or modified except by a writing executed by all parties hereto.



     Section 13. Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and permitted assigns.



     Section 14. Definitions. Terms not otherwise defined herein are used herein with the
respective meanings given them in the Credit Agreement.



[Signatures on Following Page]




B-4 









 









     IN WITNESS WHEREOF, the parties hereto have duly executed this Designation Agreement as of the
date and year first written above.



	 	 	 	 	 	 	 	 	 
	 	 	EFFECTIVE DATE:	 	 	 	 
	 

	 	 	 	 	 	 

	 	 






	 	 	 	 	 	 	 	 	 
	 	 	DESIGNATED LENDER:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	[NAME OF DESIGNATED LENDER]	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 

	 	 
	 

	 	 	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 

	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	DESIGNATED LENDER:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	[NAME OF DESIGNATED LENDER]	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	Title:
	 	 

	 	 
	 

	 	 	 	 	 	 

	 	 






Accepted as of the date first written above.




AGENT:




WACHOVIA BANK, NATIONAL ASSOCIATION, as Agent




	 	 	 	 	 	 	 
	By:
	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:
	 	 

	 	 
	 

	 	 	 	 

	 	 







B-5 









 









EXHIBIT C




FORM OF NOTICE OF BORROWING




                    , 200_




Wachovia Bank, National Association, as Agent

One Wachovia Center,

301 South College Street, 16th Floor

Charlotte, North Carolina 28288-0166

Attention: Amit Khimji




Ladies and Gentlemen:




     Reference is made to that certain Second Amended and Restated Credit Agreement dated as of
July ___, 2007 (as amended, restated, supplemented or otherwise modified from time to time, the
“Credit Agreement”), by and among UDR, Inc. (the “Borrower”), the financial institutions party
thereto and their assignees under Section 12.5 thereof (the “Lenders”), Wachovia Bank, National
Association, as Agent (the “Agent”), and the other parties thereto. Capitalized terms used herein,
and not otherwise defined herein, have their respective meanings given them in the Credit
Agreement.




	1.	 	Pursuant to Section 2.1.(b) of the Credit Agreement, the Borrower hereby
requests that the Lenders make Revolving Loans to the Borrower in an aggregate
principal amount equal to $                                        .
	 
	2.	 	The Borrower requests that such Revolving Loans be made available to the
Borrower on                     , 200_.
	 
	3.	 	The Borrower hereby requests that the requested Revolving Loans all be of the
following Type:
	 
	 	 	[Check one box only]






o Base Rate Loans

o LIBOR Loans, each with an initial Interest Period for a duration of:



	 	 	 	 	 
	 

	 	[Check one box only]
	 	o  7 days
	 

	 	 	 	o 14 days
	 

	 	 	 	o 30 days
	 

	 	 	 	o 60 days
	 

	 	 	 	o 90 days
	 

	 	 	 	o 120 days
	 

	 	 	 	o 180 days





C-1 









 









	 	4.	 	The proceeds of this borrowing of Revolving Loans will be used for the
following purpose:           
                                                                    
   .
	 
	 	5.	 	The Borrower requests that the proceeds of this borrowing of Revolving Loans be
made available to the Borrower by                                                             .





     The Borrower hereby certifies to the Agent and the Lenders that as of the date hereof and as
of the date of the making of the requested Revolving Loans and after giving effect thereto, (a) no
Default or Event of Default exists or shall exist, and (b) the representations and warranties made
or deemed made by the Borrower and each other Loan Party in the Loan Documents to which any of them
is a party are and shall be true and correct in all material respects, except to the extent that
such representations and warranties expressly relate solely to an earlier date (in which case such
representations and warranties were true and accurate on and as of such earlier date) and except
for changes in factual circumstances specifically and expressly permitted under the Credit
Agreement. In addition, the Borrower certifies to the Agent and the Lenders that all conditions to
the making of the requested Revolving Loans contained in Article V. of the Credit Agreement will
have been satisfied (or waived in accordance with the applicable provisions of the Loan Documents)
at the time such Revolving Loans are made.



     If notice of the requested borrowing of Revolving Loans was previously given by telephone,
this notice is to be considered the written confirmation of such telephone notice required by
Section 2.1.(b) of the Credit Agreement.



     IN WITNESS WHEREOF, the undersigned has duly executed and delivered this Notice of Borrowing
as of the date first written above.



	 	 	 	 	 	 	 	 	 
	 	 	UDR, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	Title:
	 	 

	 	 
	 

	 	 	 	 	 	 

	 	 






C-2 









 






EXHIBIT D




FORM OF NOTICE OF CONTINUATION




                    , 200_




Wachovia Bank, National Association, as Agent

One Wachovia Center,

301 South College Street, 16th Floor

Charlotte, North Carolina 28288-0166

Attention: Amit Khimji




Ladies and Gentlemen:




     Reference is made to that certain Second Amended and Restated Credit Agreement dated as of
July ___, 2007 (as amended, restated, supplemented or otherwise modified from time to time, the
“Credit Agreement”), by and among UDR, Inc. (the “Borrower”), the financial institutions party
thereto and their assignees under Section 12.5 thereof (the “Lenders”), Wachovia Bank, National
Association, as Agent (the “Agent”), and the other parties thereto. Capitalized terms used herein,
and not otherwise defined herein, have their respective meanings given them in the Credit
Agreement.



     Pursuant to Section 2.9. of the Credit Agreement, the Borrower hereby requests a Continuation
of a borrowing of Loans under the Credit Agreement, and in that connection sets forth below the
information relating to such Continuation as required by such Section of the Credit Agreement:




	 	1.	 	The proposed date of such Continuation is                     , ___.
	 
	 	2.	 	The aggregate principal amount of Loans subject to the requested Continuation
is $                                         and was originally borrowed by the Borrower on
                    , 200_.
	 
	 	3.	 	The portion of such principal amount subject to such Continuation is
$                                        .
	 
	 	4.	 	The current Interest Period for each of the Loans subject to such Continuation
ends on                     , 200_.
	 
	 	5.	 	The duration of the new Interest Period for each of such Loans or portion
thereof subject to such Continuation is:




D-1 









 








	 	 	 	 	 
	 

	 	[Check one box only]
	 	o  7 days
	 

	 	 	 	o 14 days
	 

	 	 	 	o 30 days
	 

	 	 	 	o 60 days
	 

	 	 	 	o 90 days
	 

	 	 	 	o 120 days
	 

	 	 	 	o 180 days





     The Borrower hereby certifies to the Agent and the Lenders that as of the date hereof, as of
the proposed date of the requested Continuation, and after giving effect to such Continuation, no
Default or Event of Default exists or will exist.



     If notice of the requested Continuation was given previously by telephone, this notice is to
be considered the written confirmation of such telephone notice required by Section 2.9. of the
Credit Agreement.



     IN WITNESS WHEREOF, the undersigned has duly executed and delivered this Notice of
Continuation as of the date first written above.



	 	 	 	 	 	 	 	 	 
	 	 	UDR, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	Title:
	 	 

	 	 
	 

	 	 	 	 	 	 

	 	 







D-2 









 









EXHIBIT E




FORM OF NOTICE OF CONVERSION




                    , 200_




Wachovia Bank, National Association, as Agent

One Wachovia Center,

301 South College Street, 16th Floor

Charlotte, North Carolina 28288-0166

Attention: Amit Khimji




Ladies and Gentlemen:




     Reference is made to that certain Second Amended and Restated Credit Agreement dated as of
July ___, 2007 (as amended, restated, supplemented or otherwise modified from time to time, the
“Credit Agreement”), by and among UDR, Inc. (the “Borrower”), the financial institutions party
thereto and their assignees under Section 12.5 thereof (the “Lenders”), Wachovia Bank, National
Association, as Agent (the “Agent”), and the other parties thereto. Capitalized terms used herein,
and not otherwise defined herein, have their respective meanings given them in the Credit
Agreement.



     Pursuant to Section 2.10. of the Credit Agreement, the Borrower hereby requests a Conversion
of a borrowing of Loans of one Type into Loans of another Type under the Credit Agreement, and in
that connection sets forth below the information relating to such Conversion as required by such
Section of the Credit Agreement:




	1.	 	The proposed date of such Conversion is                     , 200_.
	 
	2.	 	The Loans to be Converted pursuant hereto are currently:





	 	 	 	 	 
	 

	 	[Check one box only]
	 	o Base Rate Loans
	 

	 	 	 	o LIBOR Loans







	 	3.	 	The aggregate principal amount of Loans subject to the requested Conversion is
$                                         and was originally borrowed by the Borrower on                     ,
200_.
	 
	 	4.	 	The portion of such principal amount subject to such Conversion is
$                                        .




E-1 









 








	 	5.	 	The amount of such Loans to be so Converted is to be converted into Loans of
the following Type:
	 
	 	 	 	[Check one box only]




o Base Rate Loans

o LIBOR Loans, each with an initial Interest Period for a duration of:




	 	 	 	 	 
	 

	 	[Check one box only]
	 	o  7 days
	 

	 	 	 	o 14 days
	 

	 	 	 	o 30 days
	 

	 	 	 	o 60 days
	 

	 	 	 	o 90 days
	 

	 	 	 	o 120 days
	 

	 	 	 	o 180 days





     The Borrower hereby certifies to the Agent and the Lenders that as of the date hereof and as
of the date of the requested Conversion and after giving effect thereto, (a) no Default or Event of
Default exists or will exist, and (b) the representations and warranties made or deemed made by the
Borrower and each other Loan Party in the Loan Documents to which any of them is a party are and
shall be true and correct in all material respects, except to the extent that such representations
and warranties expressly relate solely to an earlier date (in which case such representations and
warranties were true and accurate on and as of such earlier date) and except for changes in factual
circumstances specifically and expressly permitted under the Credit Agreement.



     If notice of the requested Conversion was given previously by telephone, this notice is to be
considered the written confirmation of such telephone notice required by Section 2.10. of the
Credit Agreement.



     IN WITNESS WHEREOF, the undersigned has duly executed and delivered this Notice of Conversion
as of the date first written above.



	 	 	 	 	 	 	 	 	 
	 	 	UDR, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	Title:
	 	 

	 	 
	 

	 	 	 	 	 	 

	 	 







E-2 









 









EXHIBIT F




FORM OF NOTICE OF SWINGLINE BORROWING




                    , ___




Wachovia Bank, National Association, as Agent

One Wachovia Center,

301 South College Street, 16th Floor

Charlotte, North Carolina 28288-0166

Attention: Amit Khimji




Ladies and Gentlemen:



     Reference is made to that certain Second Amended and Restated Credit Agreement dated as of
July ___, 2007 (as amended, restated, supplemented or otherwise modified from time to time, the
“Credit Agreement”), by and among UDR, Inc. (the “Borrower”), the financial institutions party
thereto and their assignees under Section 12.5 thereof (the “Lenders”), Wachovia Bank, National
Association, as Agent (the “Agent”), and the other parties thereto. Capitalized terms used herein,
and not otherwise defined herein, have their respective meanings given them in the Credit
Agreement.




	 	1.	 	Pursuant to Section 2.3.(b) of the Credit Agreement, the Borrower hereby
requests that the Swingline Lender make a Swingline Loan to the Borrower in an amount
equal to $                                        .
	 
	 	2.	 	The Borrower requests that such Swingline Loan be made available to the
Borrower on                     , 200_.
	 
	 	3.	 	The proceeds of this Swingline Loan will be used for the following purpose:
                                                        
           
             .
	 
	 	4.	 	The Borrower requests that the proceeds of such Swingline Loan be made
available to the Borrower by                                                             .





     The Borrower hereby certifies to the Agent, the Swingline Lender and the Lenders that as of
the date hereof, as of the date of the making of the requested Swingline Loan, and after making
such Swingline Loan, (a) no Default or Event of Default exists or will exist, and (b) the
representations and warranties made or deemed made by the Borrower and each other Loan Party in the
Loan Documents to which any of them is a party are and shall be true and correct in all material
respects, except to the extent that such representations and warranties expressly relate solely to
an earlier date (in which case such representations and warranties were true and accurate on and as
of such earlier date) and except for changes in factual circumstances specifically and
expressly permitted under the Credit Agreement. In addition, the Borrower



F-1 









 




certifies to the Agent
and the Lenders that all conditions to the making of the requested Swingline Loan contained in
Article V. of the Credit Agreement will have been satisfied at the time such Swingline Loan is
made.




     If notice of the requested borrowing of this Swingline Loan was previously given by telephone,
this notice is to be considered the written confirmation of such telephone notice required by
Section 2.3.(b) of the Credit Agreement.



     IN WITNESS WHEREOF, the undersigned has duly executed and delivered this Notice of Swingline
Borrowing as of the date first written above.



	 	 	 	 	 	 	 	 	 
	 	 	UDR, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	Title:
	 	 

	 	 
	 

	 	 	 	 	 	 

	 	 







F-2 










 





EXHIBIT G




FORM OF SWINGLINE NOTE




			
	$50,000,000.00
	 	July ___, 2007






     FOR VALUE RECEIVED, the undersigned, UDR, INC., a Maryland corporation (the “Borrower”),
hereby promises to pay to the order of WACHOVIA BANK, NATIONAL ASSOCIATION (the “Swingline Lender”)
to its address at One Wachovia Center, 301 South College Street, Charlotte, North Carolina 28288,
or at such other address as may be specified in writing by the Swingline Lender to the Borrower,
the principal sum of FIFTY MILLION AND NO/100 DOLLARS ($50,000,000.00) (or such lesser amount as
shall equal the aggregate unpaid principal amount of Swingline Loans made by the Swingline Lender
to the Borrower under the Credit Agreement), on the dates and in the principal amounts provided in
the Credit Agreement, and to pay interest on the unpaid principal amount owing hereunder, at the
rates and on the dates provided in the Credit Agreement.



     The date, amount of each Swingline Loan, and each payment made on account of the principal
thereof, shall be recorded by the Swingline Lender on its books and, prior to any transfer of this
Note, endorsed by the Swingline Lender on the schedule attached hereto or any continuation thereof,
provided that the failure of the Swingline Lender to make any such recordation or
endorsement shall not affect the obligations of the Borrower to make a payment when due of any
amount owing under the Credit Agreement or hereunder in respect of the Swingline Loans.



     This Note is the Swingline Note referred to in the Second Amended and Restated Credit
Agreement dated as of July ___, 2007 (as amended, restated, supplemented or otherwise modified from
time to time, the “Credit Agreement”), by and among the Borrower, the financial institutions party
thereto and their assignees under Section 12.5 thereof (the “Lenders”), Wachovia Bank, National
Association, as Agent, and the other parties thereto, and evidences Swingline Loans made to the
Borrower thereunder. Terms used but not otherwise defined in this Note have the respective
meanings assigned to them in the Credit Agreement.



     The Credit Agreement provides for the acceleration of the maturity of this Note upon the
occurrence of certain events and for prepayments of Swingline Loans upon the terms and conditions
specified therein.



     THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.



     The Borrower hereby waives presentment for payment, demand, notice of demand, notice of
non-payment, protest, notice of protest and all other similar notices.



     Time is of the essence for this Note.



G-1









 





          IN WITNESS WHEREOF, the undersigned has executed and delivered this Swingline Note under seal
as of the date first written above.




	 	 	 	 	 	 	 	 	 
	 	 	UDR, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 	 	 





G-2









 






SCHEDULE OF SWINGLINE LOANS




          This Note evidences Swingline Loans made under the within-described Credit Agreement to the
Borrower, on the dates and in the principal amounts set forth below, subject to the payments and
prepayments of principal set forth below:




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Principal	 	 	 	 	 	Unpaid	 	 
	 	 	Amount of	 	Amount Paid	 	Principal	 	Notation
	Date of Loan	 	Loan	 	or Prepaid	 	Amount	 	Made By
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 






G-3









 








EXHIBIT H




FORM OF BID RATE QUOTE REQUEST




                    , ___




Wachovia Bank, National Association, as Agent

One Wachovia Center,

301 South College Street, 16th Floor

Charlotte, North Carolina 28288-0166

Attention: Amit Khimji




Ladies and Gentlemen:




     Reference is made to that certain Second Amended and Restated Credit Agreement dated as of
July ___, 2007 (as amended, restated, supplemented or otherwise modified from time to time, the
“Credit Agreement”), by and among UDR, Inc. (the “Borrower”), the financial institutions party
thereto and their assignees under Section 12.5 thereof (the “Lenders”), Wachovia Bank, National
Association, as Agent (the “Agent”), and the other parties thereto. Capitalized terms used herein,
and not otherwise defined herein, have their respective meanings given them in the Credit
Agreement.




	 	1.	 	The Borrower hereby requests Bid Rate Quotes for the following proposed Bid
Rate Borrowings:





	 	 	 	 	 	 	 	 	 	 	 	 	 
	Borrowing Date	 	Amount1	 	Type2	 	Interest Period3
	 	 	 	 	 	 	 	 	 	 	 
	                    , ______
	 	$	                    	 	 	 	                    	 	 	______ days







	 	2.	 	Borrower’s Credit Rating, as applicable, as of the date hereof is:





	 	 	 	 	 
	 

	 	S&P
	 	___
	 

	 	Moody’s
	 	___








 




			
	1	 	Minimum amount of $2,000,000 or larger multiple of
$500,000.
	 
	2	 	Insert either Absolute Rate (for Absolute Rate Loan)
or LIBOR Margin (for LIBOR Margin Loan).
	 
	3	 	No less than 7 days and up to 180 days (or up to 30
days pursuant to Section 2.15) after the borrowing date and must end on a
Business Day.




H-1









 











	 	3.	 	The proceeds of this Bid Rate Borrowing will be used for the following purpose:
	 
	 	 	 	                                                                                
                                        
	 
	 	 	 	                                                                                
                                                            .
	 
	 	4.	 	After giving effect to the Bid Rate Borrowing requested herein, the total
amount of Bid Rate Loans outstanding shall be $                    .4





     The Borrower hereby certifies to the Agent and the Lenders that as of the date hereof, as
of the date of the making of the requested Bid Rate Loans, and after making such Bid Rate Loans,
(a) no Default or Event of Default exists or will exist, and (b) the representations and warranties
made or deemed made by the Borrower and each other Loan Party in the Loan Documents to which any of
them is a party are and shall be true and correct in all material respects, except to the extent
that such representations and warranties expressly relate solely to an earlier date (in which case
such representations and warranties were true and accurate on and as of such earlier date) and
except for changes in factual circumstances specifically and expressly permitted under the Credit
Agreement. In addition, the Borrower certifies to the Agent and the Lenders that all conditions to
the making of the requested Bid Rate Loans contained in Article V. of the Credit Agreement will
have been satisfied at the time such Bid Rate Loans are made.



     IN WITNESS WHEREOF, the undersigned has duly executed and delivered this Bid Rate Quote
Request as of the date first written above.



	 	 	 	 	 	 	 	 	 
	 	 	UDR, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 	 	 







 




			
	4	 	Must not be in excess of one-half of the aggregate
amount of all existing Commitments; provided, however, pursuant to Section
2.15, not more than once during any calendar quarter, the Borrower may elect
that the foregoing limitation not apply to a single Bid Rate Borrowing
comprised of Bid Rate Loans having Interest Periods not exceeding 30 days in
duration.




H-2









 















EXHIBIT I




FORM OF BID RATE QUOTE




                    , ___




Wachovia Bank, National Association, as Agent

One Wachovia Center,

301 South College Street, 16th Floor

Charlotte, North Carolina 28288-0166

Attention: Amit Khimji




Ladies and Gentlemen:




     Reference is made to that certain Second Amended and Restated Credit Agreement dated as of
July ___, 2007 (as amended, restated, supplemented or otherwise modified from time to time, the
“Credit Agreement”), by and among UDR, Inc. (the “Borrower”), the financial institutions party
thereto and their assignees under Section 12.5 thereof (the “Lenders”), Wachovia Bank, National
Association, as Agent (the “Agent”), and the other parties thereto. Capitalized terms used herein,
and not otherwise defined herein, have their respective meanings given them in the Credit
Agreement.



     In response to Borrower’s Bid Rate Quote Request dated                     , 200_, the undersigned
hereby makes the following Bid Rate Quote(s) on the following terms:




	 	1.	 	Quoting Lender:                                                            
	 
	 	2.	 	Person to contact at quoting Lender:                                                            
	 
	 	3.	 	The undersigned offers to make Bid Rate Loan(s) in the following principal
amount(s), for the following Interest Period(s) and at the following Bid Rate(s):





	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Borrowing Date	 	Amount1	 	Type2	 	Interest Period3	 	Bid Rate
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	              , 200__
	 	$	                    	 	 	 	                    	 	 	______days	 	 	—	%
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	              , 200__
	 	$	                    	 	 	 	                    	 	 	______days	 	 	—	%
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	              , 200__
	 	$	                    	 	 	 	                    	 	 	______days	 	 	—	%










 




			
	1	 	Minimum amount of $1,000,000 or integral multiples
of $500,000.
	 
	2	 	Insert either Absolute Rate (for Absolute Rate Loan)
or LIBOR Margin (for LIBOR Margin Loan).
	 
	3	 	No less than 7 days and up to 180 days (or up to 30
days pursuant to Section 2.15) after the borrowing date and must end on a
Business Day.










I-1









 









          The undersigned understands and agrees that the offer(s) set forth above, subject to
satisfaction of the applicable conditions set forth in the Credit Agreement, irrevocably
obligate[s] the undersigned to make the Bid Rate Loan(s) for which any offer(s) [is/are] accepted,
in whole or in part.




	 	 	 	 	 	 	 	 	 
	 	 	 	 	 
	 	 	[Name of Quoting Lender]	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 	 	 






I-2









 








EXHIBIT J




FORM OF BID RATE QUOTE ACCEPTANCE




                                                            , 200_




Wachovia Bank, National Association, as Agent

One Wachovia Center,

301 South College Street, 16th Floor

Charlotte, North Carolina 28288-0166

Attention: Amit Khimji




Ladies and Gentlemen:




     Reference is made to that certain Second Amended and Restated Credit Agreement dated as of
July ___, 2007 (as amended, restated, supplemented or otherwise modified from time to time, the
“Credit Agreement”), by and among UDR, Inc. (the “Borrower”), the financial institutions party
thereto and their assignees under Section 12.5 thereof (the “Lenders”), Wachovia Bank, National
Association, as Agent (the “Agent”), and the other parties thereto. Capitalized terms used herein,
and not otherwise defined herein, have their respective meanings given them in the Credit
Agreement.



     Borrower hereby accepts the following offer(s) of Bid Rate Quotes to be made available to the
Borrower on                     , 200_:



	 	 	 	 	 	 	 	 	 
	Quote Date	 	Quoting Lender	 	Amount Accepted
	                    , 200_
	 	 	                    	 	 	$	                    	 
	 
	 	 	 	 	 	 	 	 
	                    , 200_
	 	 	                    	 	 	$	                    	 
	 
	 	 	 	 	 	 	 	 
	                    , 200_
	 	 	                    	 	 	$	                    	 






     The Borrower hereby certifies to the Agent and the Lenders that as of the date hereof, as of
the date of the making of the requested Bid Rate Loans, and after making such Bid Rate Loans, (a)
no Default or Event of Default exists or will exist, and (b) the representations and warranties
made or deemed made by the Borrower and each other Loan Party in the Loan Documents to which any of
them is a party are and shall be true and correct in all material respects, except to the extent
that such representations and warranties expressly relate solely to an earlier date (in which case
such representations and warranties were true and accurate on and as of such earlier date) and
except for changes in factual circumstances specifically and expressly permitted under the Credit
Agreement. In addition, the Borrower certifies to the Agent and the Lenders that all conditions to
the making of the requested Bid Rate Loans contained in Article V. of the Credit Agreement will
have been satisfied at the time such Bid Rate Loans are made.



J-1









 





     IN WITNESS WHEREOF, the undersigned has duly executed and delivered this Bid Rate Quote
Acceptance as of the date first written above.



	 	 	 	 	 	 	 	 	 
	 	 	UDR, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 	 	 






J-2









 








EXHIBIT K




FORM OF REVOLVING NOTE




			
	$                                                            
	 	                                        , 200_
	 	 	 





     FOR VALUE RECEIVED, the undersigned, UDR, INC., a Maryland corporation (the “Borrower”),
hereby promises to pay to the order of                                          (the “Lender”), in care of Wachovia
Bank, National Association, as Agent (the “Agent”) to Wachovia Bank, National Association, One
Wachovia Center, 301 South College Street, Charlotte, North Carolina 28288, or at such other
address as may be specified in writing by the Agent to the Borrower, the principal sum of
                                         AND ___/100 DOLLARS ($                    ) (or such lesser amount as shall equal the
aggregate unpaid principal amount of Revolving Loans made by the Lender to the Borrower under the
Credit Agreement (as herein defined)), on the dates and in the principal amounts provided in the
Credit Agreement, and to pay interest on the unpaid principal amount owing hereunder, at the rates
and on the dates provided in the Credit Agreement.



     The date, amount of each Revolving Loan made by the Lender to the Borrower, and each payment
made on account of the principal thereof, shall be recorded by the Lender on its books and, prior
to any transfer of this Note, endorsed by the Lender on the schedule attached hereto or any
continuation thereof, provided that the failure of the Lender to make any such recordation
or endorsement shall not affect the obligations of the Borrower to make a payment when due of any
amount owing under the Credit Agreement or hereunder in respect of the Revolving Loans made by the
Lender.



     This Note is one of the Revolving Notes referred to in the Second Amended and Restated Credit
Agreement dated as of July ___, 2007 (as amended, restated, supplemented or otherwise modified from
time to time, the “Credit Agreement”), by and among the Borrower, the financial institutions party
thereto and their assignees under Section 12.5 thereof (the “Lenders”), the Agent, and the other
parties thereto. Capitalized terms used herein, and not otherwise defined herein, have their
respective meanings given them in the Credit Agreement.



     The Credit Agreement provides for the acceleration of the maturity of this Note upon the
occurrence of certain events and for prepayments of Loans upon the terms and conditions specified
therein.



     Except as permitted by Section 12.5.(d) of the Credit Agreement, this Note may not be assigned
by the Lender to any other Person.



K-1









 





     THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.



     The Borrower hereby waives presentment for payment, demand, notice of demand, notice of
non-payment, protest, notice of protest and all other similar notices.



     Time is of the essence for this Note.



     IN WITNESS WHEREOF, the undersigned has executed and delivered this Revolving Note under seal
as of the date first written above.



	 	 	 	 	 	 	 	 	 
	 	 	UDR, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 	 	 





K-2









 






SCHEDULE OF REVOLVING LOANS




     This Note evidences Revolving Loans made under the within-described Credit Agreement to the
Borrower, on the dates and in the principal amounts set forth below, subject to the payments and
prepayments of principal set forth below:



	 	 	 	 	 	 	 	 	 
	 	 	Principal	 	Amount	 	Unpaid	 	 
	Date of	 	Amount of	 	Paid or	 	Principal	 	Notation
	 Loan	 	Loan	 	Prepaid	 	Amount	 	Made By
	 
	 	 	 	 	 	 	 	 






K-3









 








EXHIBIT L




FORM OF BID RATE NOTE




                    , 200_




     FOR VALUE RECEIVED, the undersigned, UDR, INC., a Maryland corporation (the “Borrower”),
hereby promises to pay to the order of                                          (the “Lender”), in care of Wachovia Bank,
National Association, as Agent (the “Agent”) to Wachovia Bank, National Association, One Wachovia
Center, 301 South College Street, Charlotte, North Carolina 28288, or at such other address as may
be specified in writing by the Agent to the Borrower, the aggregate unpaid principal amount of Bid
Rate Loans made by the Lender to the Borrower under the Credit Agreement, on the dates and in the
principal amounts provided in the Credit Agreement, and to pay interest on the unpaid principal
amount of each such Bid Rate Loan, at such office at the rates and on the dates provided in the
Credit Agreement.



     The date, amount, interest rate and maturity date of each Bid Rate Loan made by the Lender to
the Borrower, and each payment made on account of the principal thereof, shall be recorded by the
Lender on its books and, prior to any transfer of this Note, endorsed by the Lender on the schedule
attached hereto or any continuation thereof, provided that the failure of the Lender to
make any such recordation or endorsement shall not affect the obligations of the Borrower to make a
payment when due of any amount owing under the Credit Agreement or hereunder in respect of the Bid
Rate Loans made by the Lender.



     This Note is one of the Bid Rate Notes referred to in the Second and Restated Credit Agreement
dated as of July ___, 2007 (as amended, restated, supplemented or otherwise modified from time to
time, the “Credit Agreement”), by and among the Borrower, the financial institutions party thereto
and their assignees under Section 12.5 thereof (the “Lenders”), the Agent, and the other parties
thereto, and evidences Bid Rate Loans made by the Lender thereunder. Terms used but not otherwise
defined in this Note have the respective meanings assigned to them in the Credit Agreement.



     The Credit Agreement provides for the acceleration of the maturity of this Note upon the
occurrence of certain events and for prepayments of Bid Rate Loans upon the terms and conditions
specified therein.



     Except as permitted by Section 12.5. of the Credit Agreement, this Note may not be assigned by
the Lender to any other Person.



     THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.



     The Borrower hereby waives presentment for payment, demand, notice of demand, notice of
non-payment, protest, notice of protest and all other similar notices.



L-1









 





     Time is of the essence for this Note.



     IN WITNESS WHEREOF, the undersigned has executed and delivered this Bid Rate Note under seal
as of the date first written above.



	 	 	 	 	 	 	 	 	 
	 	 	UDR, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 	 	 





L-2









 






SCHEDULE OF BID RATE LOANS




     This Note evidences Bid Rate Loans made under the within-described Credit Agreement to the
Borrower, on the dates, in the principal amounts, bearing interest at the rates and maturing on the
dates set forth below, subject to the payments and prepayments of principal set forth below:



	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Principal	 	 	 	Maturity	 	Amount	 	Unpaid	 	 
	Date of	 	Amount of	 	Interest	 	Date of	 	Paid or	 	Principal	 	Notation
	 Loan	 	Loan	 	Rate	 	Loan	 	Prepaid	 	Amount	 	Made By
	 
	 	 	 	 	 	 	 	 	 	 	 	 






L-3









 








EXHIBIT M




FORM OF OPINION OF COUNSEL





M-1









 








EXHIBIT N




FORM OF COMPLIANCE CERTIFICATE




                                        , 200_ 




Wachovia Bank, National Association, as Agent

One Wachovia Center,

301 South College Street, 16th Floor

Charlotte, North Carolina 28288-0166

Attention: Amit Khimji



Each of the Lenders Party to the Credit
Agreement referred to below



Ladies and Gentlemen:




     Reference is made to that certain Second Amended and Restated Credit Agreement dated as of
July ___, 2007 (as amended, restated, supplemented or otherwise modified from time to time, the
“Credit Agreement”), by and among UDR, Inc. (the “Borrower”), the financial institutions party
thereto and their assignees under Section 12.5 thereof (the “Lenders”), Wachovia Bank, National
Association, as Agent (the “Agent”) and the other parties thereto. Capitalized terms used herein,
and not otherwise defined herein, have their respective meanings given them in the Credit
Agreement.



     Pursuant to Section 8.3. of the Credit Agreement, the undersigned hereby certifies to the
Agent and the Lenders as follows:



     (1) The undersigned is the [treasurer/ chief financial officer/ senior vice president of
finance] of the Borrower.



     (2) The undersigned has examined the books and records of the Borrower and has conducted such
other examinations and investigations as are reasonably necessary to provide this Compliance
Certificate.



     (3) To the best of the undersigned’s knowledge, after due inquiry, no Default or Event of
Default exists [if such is not the case, specify such Default or Event of Default and its nature,
when it occurred and whether it is continuing and the steps being taken by the Borrower with
respect to such event, condition or failure].



     (4) The representations and warranties made or deemed made by the Borrower and the other Loan
Parties in the Loan Documents to which any is a party, are true and correct in all material
respects on and as of the date hereof except to the extent that such representations and warranties
expressly relate solely to an earlier date (in which case such representations and
warranties shall have been true and accurate on and as of such earlier date) and except for



N-1









 




changes in factual circumstances specifically and expressly permitted under the Credit Agreement.




     (5) Attached hereto as Schedule 1 are reasonably detailed calculations establishing whether or
not the Borrower and its Subsidiaries were in compliance with the covenants contained in Sections
9.1. and 9.4. of the Credit Agreement.



     IN WITNESS WHEREOF, the undersigned has executed this certificate as of the date first above
written.



	 	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 





N-2









 





Schedule 1




[Calculations to be Attached]





N-3









 








EXHIBIT O




FORM OF GUARANTY




     THIS GUARANTY dated as of July ___, 2007, executed and delivered by each of the undersigned
and the other Persons from time to time party hereto pursuant to the execution and delivery of an
Accession Agreement in the form of Annex I hereto (all of the undersigned, together with such other
Persons each a “Guarantor” and collectively, the “Guarantors”) in favor of (a) WACHOVIA BANK,
NATIONAL ASSOCIATION, in its capacity as Agent (the “Agent”) for the Lenders under that certain
that certain Second Amended and Restated Credit Agreement dated as of July ___, 2007 (as amended,
restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and
among UDR, Inc. (the “Borrower”), the financial institutions party thereto and their assignees
under Section 12.5 thereof (the “Lenders”), the Agent, and the other parties thereto, and (b) the
Lenders and the Swingline Lender.



     WHEREAS, pursuant to the Credit Agreement, the Agent, the Lenders and the Swingline Lender
have agreed to make available to the Borrower certain financial accommodations on the terms and
conditions set forth in the Credit Agreement;



     WHEREAS, the Borrower and each of the Guarantors, though separate legal entities, are mutually
dependent on each other in the conduct of their respective businesses as an integrated operation
and have determined it to be in their mutual best interests to obtain financing from the Agent, the
Lenders and the Swingline Lender through their collective efforts;



     WHEREAS, each Guarantor acknowledges that it will receive direct and indirect benefits from
the Agent, the Lenders and the Swingline Lender making such financial accommodations available to
the Borrower under the Credit Agreement and, accordingly, each Guarantor is willing to guarantee
the Borrower’s obligations to the Agent, the Lenders and the Swingline Lender on the terms and
conditions contained herein; and



     WHEREAS, each Guarantor’s execution and delivery of this Guaranty is a condition to the Agent
and the Lenders making, and continuing to make, such financial accommodations to the Borrower.



     NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged by each Guarantor, each Guarantor agrees as follows:



     Section 1. Guaranty. Each Guarantor hereby absolutely, irrevocably and
unconditionally guaranties the due and punctual payment and performance when due, whether at stated
maturity, by acceleration or otherwise, of all of the following (collectively referred to as the
“Guarantied Obligations”): (a) all indebtedness and obligations owing by the Borrower to any
Lender, the Swingline Lender or the Agent under or in connection with the Credit Agreement and any
other Loan Document, including without limitation, the repayment of all principal of the Revolving
Loans, Bid Rate Loans, Swingline Loans and the Reimbursement Obligations, and the payment



O-1









 




of all interest, Fees, charges, attorneys’ fees and other amounts payable to any Lender or the Agent
thereunder or in connection therewith; (b) any and all extensions, renewals, modifications,
amendments or substitutions of the foregoing; (c) all expenses, including, without limitation,
reasonable attorneys’ fees and disbursements, that are incurred by the Lenders and the Agent in the
enforcement of any of the foregoing or any obligation of such Guarantor hereunder; and (d) all
other Obligations.




     Section 2. Guaranty of Payment and Not of Collection. This Guaranty is a guaranty of
payment, and not of collection, and a debt of each Guarantor for its own account. Accordingly,
none of the Lenders, the Swingline Lender or the Agent shall be obligated or required before
enforcing this Guaranty against any Guarantor: (a) to pursue any right or remedy any of them may
have against the Borrower, any other Guarantor or any other Person or commence any suit or other
proceeding against the Borrower, any other Guarantor or any other Person in any court or other
tribunal; (b) to make any claim in a liquidation or bankruptcy of the Borrower, any other Guarantor
or any other Person; or (c) to make demand of the Borrower, any other Guarantor or any other Person
or to enforce or seek to enforce or realize upon any collateral security held by the Lenders, the
Swingline Lender or the Agent which may secure any of the Guarantied Obligations.



     Section 3. Guaranty Absolute. Each Guarantor guarantees that the Guarantied
Obligations will be paid strictly in accordance with the terms of the documents evidencing the
same, regardless of any Applicable Law now or hereafter in effect in any jurisdiction affecting any
of such terms or the rights of the Agent, the Lenders or the Swingline Lender with respect thereto.
The liability of each Guarantor under this Guaranty shall be absolute, irrevocable and
unconditional in accordance with its terms and shall remain in full force and effect without regard
to, and shall not be released, suspended, discharged, terminated or otherwise affected by, any
circumstance or occurrence whatsoever, including without limitation, the following (whether or not
such Guarantor consents thereto or has notice thereof):



     (a) (i) any change in the amount, interest rate or due date or other term of any of the
Guarantied Obligations, (ii) any change in the time, place or manner of payment of all or any
portion of the Guarantied Obligations, (iii) any amendment or waiver of, or consent to the
departure from or other indulgence with respect to, the Credit Agreement, any other Loan Document,
or any other document or instrument evidencing or relating to any Guarantied Obligations, or (iv)
any waiver, renewal, extension, addition, or supplement to, or deletion from, or any other action
or inaction under or in respect of, the Credit Agreement, any of the other Loan Documents, or any
other documents, instruments or agreements relating to the Guarantied Obligations or any other
instrument or agreement referred to therein or evidencing any Guarantied Obligations or any
assignment or transfer of any of the foregoing;



     (b) any lack of validity or enforceability of the Credit Agreement, any of the other Loan
Documents, or any other document, instrument or agreement referred to therein or evidencing any
Guarantied Obligations or any assignment or transfer of any of the foregoing;



O-2









 





     (c) any furnishing to the Agent, the Lenders or the Swingline Lender of any security for the
Guarantied Obligations, or any sale, exchange, release or surrender of, or realization on, any
collateral securing any of the Obligations;



     (d) any settlement or compromise of any of the Guarantied Obligations, any security therefor,
or any liability of any other party with respect to the Guarantied Obligations, or any
subordination of the payment of the Guarantied Obligations to the payment of any other liability of
the Borrower or any other Loan Party;



     (e) any bankruptcy, insolvency, reorganization, composition, adjustment, dissolution,
liquidation or other like proceeding relating to such Guarantor, the Borrower, any other Loan Party
or any other Person, or any action taken with respect to this Guaranty by any trustee or receiver,
or by any court, in any such proceeding;



     (f) any act or failure to act by the Borrower, any other Loan Party or any other Person which
may adversely affect such Guarantor’s subrogation rights, if any, against the Borrower to recover
payments made under this Guaranty;



     (g) any nonperfection or impairment of any security interest or other Lien on any collateral,
if any, securing in any way any of the Obligations;



     (h) any application of sums paid by the Borrower, any other Guarantor or any other Person with
respect to the liabilities of the Borrower to the Agent, the Lenders or the Swingline Lender,
regardless of what liabilities of the Borrower remain unpaid;



     (i) any defect, limitation or insufficiency in the borrowing powers of the Borrower or in the
exercise thereof; or



     (j) any other circumstance which might otherwise constitute a defense available to, or a
discharge of, a Guarantor hereunder (other than indefeasible payment in full).



     Section 4. Action with Respect to Guarantied Obligations. The Lenders and the Agent
may, at any time and from time to time, without the consent of, or notice to, any Guarantor, and
without discharging any Guarantor from its obligations hereunder, take any and all actions
described in Section 3 and may otherwise: (a) amend, modify, alter or supplement the terms of any
of the Guarantied Obligations, including, but not limited to, extending or shortening the time of
payment of any of the Guarantied Obligations or changing the interest rate that may accrue on any
of the Guarantied Obligations; (b) amend, modify, alter or supplement the Credit Agreement or any
other Loan Document; (c) sell, exchange, release or otherwise deal with all, or any part, of any
collateral securing any of the Obligations; (d) release any other Loan Party or other Person liable
in any manner for the payment or collection of the Guarantied Obligations; (e) exercise, or refrain
from exercising, any rights against the Borrower, any other Guarantor or any other Person; and (f)
apply any sum, by whomsoever paid or however realized, to the Guarantied Obligations in such order
as the Lenders shall elect.



O-3









 





     Section 5. Representations and Warranties. Each Guarantor hereby makes to the Agent,
the Lenders and the Swingline Lender all of the representations and warranties made by the Borrower
with respect to or in any way relating to such Guarantor in the Credit Agreement and the other Loan
Documents, as if the same were set forth herein in full.



     Section 6. Covenants. Each Guarantor will comply with all covenants which the
Borrower is to cause such Guarantor to comply with under the terms of the Credit Agreement or any
of the other Loan Documents.



     Section 7. Waiver. Each Guarantor, to the fullest extent permitted by Applicable
Law, hereby waives notice of acceptance hereof or any presentment, demand, protest or notice of any
kind, and any other act or thing, or omission or delay to do any other act or thing, which in any
manner or to any extent might vary the risk of such Guarantor or which otherwise might operate to
discharge such Guarantor from its obligations hereunder.



     Section 8. Inability to Accelerate Loan. If the Agent, the Swingline Lender and/or
the Lenders are prevented under Applicable Law or otherwise from demanding or accelerating payment
of any of the Guarantied Obligations by reason of any automatic stay or otherwise, the Agent, the
Swingline Lender and/or the Lenders shall be entitled to receive from each Guarantor, upon demand
therefor, the sums which otherwise would have been due had such demand or acceleration occurred.



     Section 9. Reinstatement of Guarantied Obligations. If claim is ever made on the
Agent, any Lender or the Swingline Lender for repayment or recovery of any amount or amounts
received in payment or on account of any of the Guarantied Obligations, and the Agent, such Lender
or the Swingline Lender repays all or part of said amount by reason of (a) any judgment, decree or
order of any court or administrative body of competent jurisdiction, or (b) any settlement or
compromise of any such claim effected by the Agent, such Lender or the Swingline Lender with any
such claimant (including the Borrower or a trustee in bankruptcy for the Borrower), then and in
such event each Guarantor agrees that any such judgment, decree, order, settlement or compromise
shall be binding on it, notwithstanding any revocation hereof or the cancellation of the Credit
Agreement, any of the other Loan Documents, or any other instrument evidencing any liability of the
Borrower, and such Guarantor shall be and remain liable to the Agent, such Lender or the Swingline
Lender for the amounts so repaid or recovered to the same extent as if such amount had never
originally been paid to the Agent, such Lender or the Swingline Lender.



     Section 10. Subrogation. Upon the making by any Guarantor of any payment hereunder
for the account of the Borrower, such Guarantor shall be subrogated to the rights of the payee
against the Borrower; provided, however, that such Guarantor shall not enforce any
right or receive any payment by way of subrogation or otherwise take any action in respect of any
other claim or cause of action such Guarantor may have against the Borrower arising by reason of
any payment or performance by such Guarantor pursuant to this Guaranty, unless and until all of the
Guarantied Obligations have been indefeasibly paid and performed in full. If any amount shall be
paid to such Guarantor on account of or in respect of such subrogation rights or other claims or
causes of action, such Guarantor shall hold such amount in trust for the benefit of the Agent,



O-4









 




the
Lenders and the Swingline Lender and shall forthwith pay such amount to the Agent to be credited
and applied against the Guarantied Obligations, whether matured or unmatured, in accordance with
the terms of the Credit Agreement or to be held by the Agent as collateral security for any
Guarantied Obligations existing.




     Section 11. Payments Free and Clear. All sums payable by each Guarantor hereunder,
whether of principal, interest, Fees, expenses, premiums or otherwise, shall be paid in full,
without set-off or counterclaim or any deduction or withholding whatsoever (including any Taxes),
and if any Guarantor is required by Applicable Law or by a Governmental Authority to make any such
deduction or withholding, such Guarantor shall pay to the Agent, the Lenders and the Swingline
Lender such additional amount as will result in the receipt by the Agent, the Lenders and the
Swingline Lender of the full amount payable hereunder had such deduction or withholding not
occurred or been required.



     Section 12. Set-off. In addition to any rights now or hereafter granted under any of
the other Loan Documents or Applicable Law and not by way of limitation of any such rights, each
Guarantor hereby authorizes the Agent and each Lender, at any time while an Event of Default
exists, without any prior notice to such Guarantor or to any other Person, any such notice being
hereby expressly waived, but in the case of a Lender or Participant subject to receipt of the prior
written consent of the Agent exercised in its sole discretion, to set off and to appropriate and to
apply any and all deposits (general or special, including, but not limited to, indebtedness
evidenced by certificates of deposit, whether matured or unmatured) and any other indebtedness at
any time held or owing by the Agent, such Lender, or any Affiliate of the Agent or such Lender, to
or for the credit or the account of such Guarantor against and on account of any of the Guarantied
Obligations, although such obligations shall be contingent or unmatured. Each Guarantor agrees, to
the fullest extent permitted by Applicable Law, that any Participant may exercise rights of setoff
or counterclaim and other rights with respect to its participation as fully as if such Participant
were a direct creditor of such Guarantor in the amount of such participation.



     Section 13. Subordination. Each Guarantor hereby expressly covenants and agrees for
the benefit of the Agent, the Lenders and the Swingline Lender that all obligations and liabilities
of the Borrower to such Guarantor of whatever description, including without limitation, all
intercompany receivables of such Guarantor from the Borrower (collectively, the “Junior Claims”)
shall be subordinate and junior in right of payment to all Guarantied Obligations. If an Event of
Default exists or will exist, then no Guarantor shall accept any direct or indirect payment (in
cash, property or securities, by setoff or otherwise) from the Borrower on account of or in any
manner in respect of any Junior Claim until all of the Guarantied Obligations have been
indefeasibly paid in full.



     Section 14. Avoidance Provisions. It is the intent of each Guarantor, the Agent, the
Lenders and the Swingline Lender that in any Proceeding, such Guarantor’s maximum obligation
hereunder shall equal, but not exceed, the maximum amount which would not otherwise cause the
obligations of such Guarantor hereunder (or any other obligations of such Guarantor to the Agent,
the Lenders and the Swingline Lender) to be avoidable or unenforceable against such
Guarantor in such Proceeding as a result of Applicable Law, including without limitation,



O-5









 




(a)
Section 548 of the Bankruptcy Code of 1978, as amended (the “Bankruptcy Code”) and (b) any state
fraudulent transfer or fraudulent conveyance act or statute applied in such Proceeding, whether by
virtue of Section 544 of the Bankruptcy Code or otherwise. The Applicable Laws under which the
possible avoidance or unenforceability of the obligations of such Guarantor hereunder (or any other
obligations of such Guarantor to the Agent, the Lenders and the Swingline Lender) shall be
determined in any such Proceeding are referred to as the “Avoidance Provisions”. Accordingly, to
the extent that the obligations of any Guarantor hereunder would otherwise be subject to avoidance
under the Avoidance Provisions, the maximum Guarantied Obligations for which such Guarantor shall
be liable hereunder shall be reduced to that amount which, as of the time any of the Guarantied
Obligations are deemed to have been incurred under the Avoidance Provisions, would not cause the
obligations of such Guarantor hereunder (or any other obligations of such Guarantor to the Agent,
the Lenders and the Swingline Lender), to be subject to avoidance under the Avoidance Provisions.
This Section is intended solely to preserve the rights of the Agent, the Lenders and the Swingline
Lender hereunder to the maximum extent that would not cause the obligations of any Guarantor
hereunder to be subject to avoidance under the Avoidance Provisions, and no Guarantor or any other
Person shall have any right or claim under this Section as against the Agent, the Lenders and the
Swingline Lender that would not otherwise be available to such Person under the Avoidance
Provisions.




     Section 15. Information. Each Guarantor assumes all responsibility for being and
keeping itself informed of the financial condition of the Borrower and the other Guarantors, and of
all other circumstances bearing upon the risk of nonpayment of any of the Guarantied Obligations
and the nature, scope and extent of the risks that such Guarantor assumes and incurs hereunder, and
agrees that none of the Agent, the Lenders or the Swingline Lender shall have any duty whatsoever
to advise any Guarantor of information regarding such circumstances or risks.



     Section 16. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE
FULLY PERFORMED, IN SUCH STATE.



     SECTION 17. WAIVER OF JURY TRIAL.



     (a) EACH PARTY HERETO ACKNOWLEDGES THAT ANY DISPUTE OR CONTROVERSY BETWEEN OR AMONG ANY
GUARANTOR, THE AGENT OR ANY OF THE LENDERS WOULD BE BASED ON DIFFICULT AND COMPLEX ISSUES OF LAW
AND FACT AND WOULD RESULT IN DELAY AND EXPENSE TO THE PARTIES. ACCORDINGLY, TO THE EXTENT
PERMITTED BY APPLICABLE LAW, EACH OF THE LENDERS, THE AGENT AND EACH GUARANTOR HEREBY WAIVES ITS
RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING OF ANY KIND OR NATURE IN ANY COURT OR TRIBUNAL
IN WHICH AN ACTION MAY BE COMMENCED BY OR AGAINST ANY PARTY HERETO ARISING OUT OF THIS GUARANTY OR
ANY OTHER LOAN DOCUMENT OR BY REASON OF ANY OTHER SUIT, CAUSE OF ACTION OR
DISPUTE WHATSOEVER BETWEEN OR AMONG ANY GUARANTOR, THE AGENT OR



O-6









 




ANY OF THE LENDERS OF ANY KIND OR
NATURE RELATING TO ANY OF THE LOAN DOCUMENTS.




     (b) EACH OF THE GUARANTORS, THE AGENT AND EACH LENDER HEREBY AGREES THAT THE FEDERAL DISTRICT
COURT OF THE SOUTHERN DISTRICT OF NEW YORK OR ANY STATE COURT LOCATED IN NEW YORK, NEW YORK, SHALL
HAVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN OR AMONG ANY GUARANTOR, THE
AGENT OR ANY OF THE LENDERS, PERTAINING DIRECTLY OR INDIRECTLY TO THIS GUARANTY, OR ANY OTHER LOAN
DOCUMENT OR TO ANY MATTER ARISING HEREFROM OR THEREFROM. EACH GUARANTOR AND EACH OF THE LENDERS
EXPRESSLY SUBMIT AND CONSENT IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR PROCEEDING COMMENCED
IN SUCH COURTS WITH RESPECT TO SUCH CLAIMS OR DISPUTES. EACH PARTY FURTHER WAIVES ANY OBJECTION
THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT
OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT FORUM AND EACH AGREES NOT TO PLEAD
OR CLAIM THE SAME. THE CHOICE OF FORUM SET FORTH IN THIS SECTION SHALL NOT BE DEEMED TO PRECLUDE
THE BRINGING OF ANY ACTION BY THE AGENT OR ANY LENDER OR THE ENFORCEMENT BY THE AGENT OR ANY LENDER
OF ANY JUDGMENT OBTAINED IN SUCH FORUM IN ANY OTHER APPROPRIATE JURISDICTION.



     (c) THE PROVISIONS OF THIS SECTION HAVE BEEN CONSIDERED BY EACH PARTY WITH THE ADVICE OF
COUNSEL AND WITH A FULL UNDERSTANDING OF THE LEGAL CONSEQUENCES THEREOF, AND SHALL SURVIVE THE
PAYMENT OF THE LOANS AND ALL OTHER AMOUNTS PAYABLE HEREUNDER OR UNDER THE OTHER LOAN DOCUMENTS AND
THE TERMINATION OF THIS GUARANTY.



     Section 18. Loan Accounts. The Agent, each Lender and the Swingline Lender may
maintain books and accounts setting forth the amounts of principal, interest and other sums paid
and payable with respect to the Guarantied Obligations, and in the case of any dispute relating to
any of the outstanding amount, payment or receipt of any of the Guarantied Obligations or
otherwise, the entries in such books and accounts shall be deemed prima facie evidence of the
amounts and other matters set forth herein. The failure of the Agent, any Lender or the Swingline
Lender to maintain such books and accounts shall not in any way relieve or discharge any Guarantor
of any of its obligations hereunder.



     Section 19. Waiver of Remedies. No delay or failure on the part of the Agent, any
Lender or the Swingline Lender in the exercise of any right or remedy it may have against any
Guarantor hereunder or otherwise shall operate as a waiver thereof, and no single or partial
exercise by the Agent, any Lender or the Swingline Lender of any such right or remedy shall
preclude any other or further exercise thereof or the exercise of any other such right or remedy.



O-7









 





     Section 20. Termination. This Guaranty shall remain in full force and effect until
indefeasible payment in full of the Guarantied Obligations and the other Obligations and the
termination or cancellation of the Credit Agreement in accordance with its terms.



     Section 21. Successors and Assigns. Each reference herein to the Agent or the
Lenders shall be deemed to include such Person’s respective successors and assigns (including, but
not limited to, any holder of the Guarantied Obligations) in whose favor the provisions of this
Guaranty also shall inure, and each reference herein to each Guarantor shall be deemed to include
such Guarantor’s successors and assigns, upon whom this Guaranty also shall be binding. The
Lenders and the Swingline Lender may, in accordance with the applicable provisions of the Credit
Agreement, assign, transfer or sell any Guarantied Obligation, or grant or sell participations in
any Guarantied Obligations, to any Person without the consent of, or notice to, any Guarantor and
without releasing, discharging or modifying any Guarantor’s obligations hereunder. Each Guarantor
hereby consents to the delivery by the Agent or any Lender to any Assignee or Participant (or any
prospective Assignee or Participant) of any financial or other information regarding the Borrower
or any Guarantor. No Guarantor may assign or transfer its rights or obligations hereunder to any
Person without the prior written consent of all Lenders and any such assignment or other transfer
to which all of the Lenders have not so consented shall be null and void.



     Section 22. JOINT AND SEVERAL OBLIGATIONS. THE OBLIGATIONS OF THE GUARANTORS
HEREUNDER SHALL BE JOINT AND SEVERAL, AND ACCORDINGLY, EACH GUARANTOR CONFIRMS THAT IT IS LIABLE
FOR THE FULL AMOUNT OF THE “GUARANTIED OBLIGATIONS” AND ALL OF THE OBLIGATIONS AND LIABILITIES OF
EACH OF THE OTHER GUARANTORS HEREUNDER.



     Section 23. Amendments. This Guaranty may not be amended except in writing signed by
the Requisite Lenders (or all of the Lenders if required under the terms of the Credit Agreement),
the Agent and each Guarantor.



     Section 24. Payments. All payments to be made by any Guarantor pursuant to this
Guaranty shall be made in Dollars, in immediately available funds to the Agent at the Principal
Office, not later than 2:00 p.m. on the date of demand therefor.



     Section 25. Notices. All notices, requests and other communications hereunder shall
be in writing (including facsimile transmission or similar writing) and shall be given (a) to each
Guarantor at its address set forth below its signature hereto, (b) to the Agent, any Lender or the
Swingline Lender at its respective address for notices provided for in the Credit Agreement, or (c)
as to each such party at such other address as such party shall designate in a written notice to
the other parties. Each such notice, request or other communication shall be effective (i) if
mailed, when received; (ii) if telecopied, when transmitted; or (iii) if hand delivered, when
delivered; provided, however, that any notice of a change of address for notices
shall not be effective until received.



O-8









 





     Section 26. Severability. In case any provision of this Guaranty shall be invalid,
illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.



     Section 27. Headings. Section headings used in this Guaranty are for convenience
only and shall not affect the construction of this Guaranty.



     Section 28. Trustees, Etc. Not Liable.



     IN THE CASE OF ANY GUARANTOR THAT IS A TRUST, NO TRUSTEE, OFFICER, SHAREHOLDER, EMPLOYEE OR
AGENT OF SUCH GUARANTOR SHALL BE HELD TO ANY PERSONAL LIABILITY, JOINTLY OR SEVERALLY, FOR ANY
OBLIGATION OF, OR CLAIM AGAINST, SUCH GUARANTOR. ALL PERSONS DEALING WITH SUCH GUARANTOR, IN ANY
WAY, SHALL LOOK ONLY TO THE ASSETS OF SUCH GUARANTOR FOR THE PAYMENT OF ANY SUM OR THE PERFORMANCE
OF ANY OBLIGATION OWING BY SUCH GUARANTOR HEREUNDER. THE PROVISIONS OF THIS SECTION SHALL NOT LIMIT
ANY OBLIGATIONS OF ANY LOAN PARTY.



     Section 29. Limitation of Liability.



     Neither the Agent nor any Lender, nor any Affiliate, officer, director, employee, attorney, or
agent of the Agent or any Lender, shall have any liability with respect to, and each Guarantor
hereby waives, releases, and agrees not to sue any of them upon, any claim for any special,
indirect, incidental, or consequential damages suffered or incurred by a Guarantor in connection
with, arising out of, or in any way related to, this Guaranty or any of the other Loan Documents,
or any of the transactions contemplated by this Guaranty, the Credit Agreement or any of the other
Loan Documents. Each Guarantor hereby waives, releases, and agrees not to sue the Agent or any
Lender or any of the Agent’s or any Lender’s Affiliates, officers, directors, employees, attorneys,
or agents for punitive damages in respect of any claim in connection with, arising out of, or in
any way related to, this Guaranty, the Credit Agreement or any of the other Loan Documents, or any
of the transactions contemplated by Credit Agreement or financed thereby.



     Section 30. Definitions. (a) For the purposes of this Guaranty:



     “Proceeding” means any of the following: (i) a voluntary or involuntary case
concerning any Guarantor shall be commenced under the Bankruptcy Code of 1978, as amended; (ii) a
custodian (as defined in such Bankruptcy Code or any other applicable bankruptcy laws) is appointed
for, or takes charge of, all or any substantial part of the property of any Guarantor; (iii) any
other proceeding under any Applicable Law, domestic or foreign, relating to bankruptcy, insolvency,
reorganization, winding-up or composition for adjustment of debts, whether now or hereafter in
effect, is commenced relating to any Guarantor; (iv) any Guarantor is adjudicated insolvent or
bankrupt; (v) any order of relief or other order approving any such case or proceeding is entered
by a court of competent jurisdiction; (vi) any Guarantor makes a general assignment for the benefit
of creditors; (vii) any Guarantor shall fail to pay, or shall state that it is
unable to pay, or shall be unable to pay, its debts generally as they become due;



O-9









 




(viii) any
Guarantor shall call a meeting of its creditors with a view to arranging a composition or
adjustment of its debts; (ix) any Guarantor shall by any act or failure to act indicate its consent
to, approval of or acquiescence in any of the foregoing; or (x) any corporate action shall be taken
by any Guarantor for the purpose of effecting any of the foregoing.




     (b) Terms not otherwise defined herein are used herein with the respective meanings given them
in the Credit Agreement.



[Signature on Next Page]




O-10









 








     IN WITNESS WHEREOF, each Guarantor has duly executed and delivered this Guaranty as of the
date and year first written above.



	 	 	 	 	 	 	 
	 	 	[GUARANTORS]	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	 	 	Address for Notices:	 	 
	 
	 	 	 	 	 	 
	 	 	c/o UDR, Inc.	 	 
	 	 	1745 Shea Center Drive, Suite 200	 	 
	 	 	Highlands Ranch, Colorado 80129	 	 
	 	 	Attention: Treasurer	 	 
	 	 	Telecopy Number:      (720) 283-6142	 	 
	 	 	Telephone Number:      (720) 283-2453	 	 






O-11









 






ANNEX I




FORM OF ACCESSION AGREEMENT




     THIS ACCESSION AGREEMENT dated as of                     , ___, executed and delivered by
                                                            , a                     
 (the “New Guarantor”), in favor of (a) WACHOVIA BANK,
NATIONAL ASSOCIATION, in its capacity as Agent (the “Agent”) for the Lenders under that certain
Second Amended and Restated Credit Agreement dated as of July ___, 2007 (as amended, restated,
supplemented or otherwise modified from time to time, the “Credit Agreement”), by and among UDR,
Inc. (the “Borrower”), the financial institutions party thereto and their assignees under Section
12.5 thereof (the “Lenders”), the Agent, and the other parties thereto, and (b) the Lenders and the
Swingline Lender.



     WHEREAS, pursuant to the Credit Agreement, the Agent, the Lenders and the Swingline Lender
have agreed to make available to the Borrower certain financial accommodations on the terms and
conditions set forth in the Credit Agreement;



     WHEREAS, the Borrower, the New Guarantor, and the existing Guarantors, though separate legal
entities, are mutually dependent on each other in the conduct of their respective businesses as an
integrated operation and have determined it to be in their mutual best interests to obtain
financing from the Agent, the Lenders and the Swingline Lender through their collective efforts;



     WHEREAS, the New Guarantor acknowledges that it will receive direct and indirect benefits from
the Agent, the Lenders and the Swingline Lender making such financial accommodations available to
the Borrower under the Credit Agreement and, accordingly, the New Guarantor is willing to guarantee
the Borrower’s obligations to the Agent, the Lenders and the Swingline Lender on the terms and
conditions contained herein; and



     WHEREAS, the New Guarantor’s execution and delivery of this Agreement is a condition to the
Agent, the Lenders and the Swingline Lender continuing to make such financial accommodations to the
Borrower.



     NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged by the New Guarantor, the New Guarantor agrees as follows:



     Section 1. Accession to Guaranty. The New Guarantor hereby agrees that it is a
“Guarantor” under that certain Guaranty dated as of July ___, 2007 (as amended, supplemented,
restated or otherwise modified from time to time, the “Guaranty”), made by each Subsidiary of the
Borrower a party thereto in favor of the Agent, the Lenders and the Swingline Lender and assumes
all obligations of a “Guarantor” thereunder and agrees to be bound thereby, all as if the New
Guarantor had been an original signatory to the Guaranty. Without limiting the generality of the
foregoing, the New Guarantor hereby:



O-12









 





     (a) irrevocably and unconditionally guarantees the due and punctual payment and performance
when due, whether at stated maturity, by acceleration or otherwise, of all Guarantied Obligations
(as defined in the Guaranty);



     (b) makes to the Agent, the Lenders and the Swingline Lender as of the date hereof each of the
representations and warranties contained in Section 5 of the Guaranty and agrees to be bound by
each of the covenants contained in Section 6 of the Guaranty; and



     (c) consents and agrees to each provision set forth in the Guaranty.



     SECTION 2. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED,
AND TO BE FULLY PERFORMED, IN SUCH STATE.



     Section 3. Definitions. Capitalized terms used herein and not otherwise defined
herein shall have their respective defined meanings given them in the Credit Agreement.



[Signatures on Next Page]




O-13









 








     IN WITNESS WHEREOF, the New Guarantor has caused this Accession Agreement to be duly executed
and delivered under seal by its duly authorized officers as of the date first written above.



	 	 	 	 	 	 	 	 	 
	 	 	[NEW GUARANTOR]	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Address for Notices:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	c/o UDR, Inc.	 	 
	 	 	1745 Shea Center Drive, Suite 200	 	 
	 	 	Highlands Ranch, Colorado 80129	 	 
	 	 	Attention: Treasurer	 	 
	 	 	Telecopy Number: (720) 283-6142	 	 
	 	 	Telephone Number: (720) 283-2453	 	 






	 	 	 	 	 	 	 
	Accepted:	 	 
	 
	 	 	 	 	 	 
	WACHOVIA BANK, NATIONAL ASSOCIATION,

     as Agent	 	 
	 
	 	 	 	 	 	 
	By:
	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 






O-14