**Exhibit10.35**

**SECURITY AGREEMENT**

This SECURITY AGREEMENT(this “Agreement”), dated as of October 2, 2006, is made by GMHCOMMUNITIES, LP, a Delaware limited partnership (the “Borrower”),COLLEGE PARK MANAGEMENT, LLC, a Florida limited liability company, GMHCOMMUNITIES SERVICES, INC., a Delaware corporation, GMH COMMUNITIES TRUST, aMaryland real estate investment trust, GMH COMMUNITIES TRS, INC., a Delawarecorporation, GMH MILITARY HOUSING INVESTMENTS, LLC, a Delaware limitedliability company, COLLEGE PARK MANAGEMENT TRS, INC., a Delaware corporationand GMH MILITARY HOUSING, LLC, a Delaware limited liability company (togetherwith the Borrower, each a “Grantor”, collectively, the “Grantors”),in favor of WACHOVIA BANK, NATIONAL ASSOCIATION (the “Secured Party”).

**RECITALS**

Pursuant to the LoanAgreement, dated as of October 2, 2006 (as amended, supplemented or otherwisemodified from time to time, the “Loan Agreement”), among the Borrowerand Secured Party, the Secured Party has agreed to make a loan (consisting ofan Initial Advance and Additional Advances to be made after the date hereof)(the “Loan”) to the Borrower upon the terms and subject to theconditions set forth therein.  It is acondition precedent to the obligation of the Secured Party to make the loan tothe Borrower under the Loan Agreement that each Grantor shall have executed anddelivered this Agreement to the Secured Party.

NOW, THEREFORE, inconsideration of the premises and to induce the Secured Party to enter into theLoan Agreement and to induce the Secured Party to make the Loan to the Borrowerunder the Loan Agreement, each Grantor hereby agrees with the Secured Party, asfollows:

# 1.     Defined Terms.  (a) Unless otherwise defined herein, capitalized terms which are defined inthe Loan Agreement and used herein shall have the meanings given to them in theLoan Agreement; the following terms which are defined in the Uniform CommercialCode in effect in the State of New York on the date hereof are used herein asso defined: Account(s), Certificated Security, Chattel Paper, Documents,Equipment, Farm Products, General Intangibles, Instruments, Inventory,Investment Property, Letter-of-Credit Rights, Proceeds, Securities Account andSupporting Obligations; and the following terms shall have the followingmeanings:

“AccountControl Agreement”: with respect to any Deposit Account, a controlagreement in a form approved by the Lender, as amended, supplemented orotherwise modified from time to time.

“Code”: theUniform Commercial Code as from time to time in effect in the State of NewYork.

“Collateral”:as defined in Section 2 of this Agreement (and shall not include any ExcludedCollateral).

“CollateralAccount”:  any collateral accountestablished by the Secured Party as provided in Section 3(d) or 8.

“Copyright”:(a)  any copyright in any original workof authorship fixed in any tangible medium of expression (including, withoutlimitation, any thereof referred to on Schedule V hereto), 

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including, withoutlimitation, all databases, source codes, object codes and manuals, whetherpublished or unpublished, whether now or hereafter existing, and whether in theUnited States or any other country, and all applications, registrations,renewals, extensions and recordings relating thereto filed in the United StatesCopyright Office or in any other governmental office or agency in the UnitedStates or any other country or political subdivision thereof, in each case inwhich any Grantor has any right, title or interest, whether as author,assignee, transferee or otherwise, and all other rights which any Grantorpresently has or hereafter acquires pursuant to any Copyright License relatingto any such copyright, including, without limitation, copyright assignments,and exclusive and nonexclusive licenses, and (b) all right, title and interestof any Grantor in all physical materials embodying any work with respect towhich any Grantor owns or holds rights in any Copyright or Copyright License.

“CopyrightLicense”: (a) any agreement, written or oral, naming any Grantor aslicensor or licensee, granting any right in or to any Copyright or copyrightregistration in the United States or any foreign country (including, withoutlimitation, any thereof referred to on Schedule V hereto) or (b) any and allpresent and future agreements, including, without limitation, assignments andconsents, as any such agreements may from time to time be amended orsupplemented, pursuant to which any Grantor now has or hereafter acquires anydirect or beneficial interest in any Copyright, or is a grantor of rights toany third party with respect to any copyright, whether as a party to any suchagreement or as an assignee of any rights under any such agreement (including,without limitation, any thereof referred to on Schedule V hereto) excluding,however, non-exclusive computer software licenses.

“DepositAccount”: a “deposit account” as defined in the Uniform Commercial Code ofany applicable jurisdiction and, in any event, including without limitation anydemand, time, savings, passbook or like account maintained with any depositaryinstitution.

“Excess CashFlow Receivables”:  all of Borrower’sright, title and interest in all amounts to be paid, and all amounts paid, fromtime to time to any Grantor pursuant to the Excess Cash Flow Direction Letter.

“ExcludedAssets”: any asset of any Grantor described in clauses (i) through (xx) ofthe definition of “Collateral” to the extent that the grant of a securityinterest therein pursuant to this Agreement (i) is prohibited by any contract,agreement, instrument or indenture in existence as of October 2, 2006 of anyGrantor or any Subsidiary of such Grantor to the extent such prohibition isapplicable to such Grantor, (ii) would terminate any contract, agreement,instrument or indenture of the Grantor or its Subsidiaries or give any otherparty thereto or to any such contract, agreement, instrument or indenture theright to terminate such party’s obligations under any such contract, agreement,instrument or indenture, (iii) is permitted only with the consent of any otherPerson, which consent has not been obtained, or (iv) would result in, orrequire, the creation of any Lien on any portion of the Collateral pursuant tothe terms of any contract, agreement, instrument or indenture of such Grantor,but only, in the case of each of subclauses (i) through (iv), to the extentthat any such prohibition, limitation or restriction would be effective underapplicable law (including, without limitation, as provided under Sections 9-406and 9-408 of the Code).

“GMH FacilityAccount”: a Deposit Account established by each Grantor in accordance withthe requirements of this Agreement with respect to which the applicableGrantor(s) shall execute and deliver, and cause to be delivered, an AccountControl Agreement.

“Patent License”:any agreement, whether written or oral, providing for the grant by or to anyGrantor of any right to manufacture, use or sell any invention covered by aPatent, and all rights of any Grantor under such agreement.

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“Patents”:(a) all letters patent of the United States or any other country, includingpatents, design patents and utility models, and all registrations andrecordings thereof, (b) all applications for letters patent of the UnitedStates or any other country and (c) all reissues, extensions, divisions,continuations and continuations-in-part thereof, and the inventions disclosedor claimed therein, including the right to make, sell and/or use the inventionsdisclosed or claimed therein; including, without limitation.

“Receivable”: any right to payment for goods sold or leased or forservices rendered, whether or not such right is evidenced by an Instrument or Chattel Paper and whether or not it has been earned by performance(including, without limitation, any Account), including, without limitation,all Excess Cash Flow Receivables.

“TrademarkLicense”: any agreement, written or oral, providing for the grant by or toany Grantor of any right to use any Trademark.

“Trademarks”:(a) all trademarks, trade names, corporate names, company names, businessnames, fictitious business names, trade styles, service marks, logos and othersource or business identifiers, all prints or labels on which any of theforegoing appear, and all designs and general intangibles of a like nature, andthe goodwill associated therewith or symbolized thereby, and all other assets,rights and interests that uniquely embody such goodwill, now existing orhereafter adopted or acquired, all registrations and recordings thereof, andall applications in connection therewith, whether in the United States Patentand Trademark Office or in any similar office or agency of the United States,any state thereof or any other country or any political subdivision thereof, orotherwise, and (b) all extensions or renewals thereof.

## (b)           The words “hereof”, “herein”and “hereunder” and words of similar import when used in this Agreement shallrefer to this Agreement as a whole and not to any particular provision of thisAgreement, and Section, Schedule. Annex, and Exhibit references are to thisAgreement unless otherwise specified. The meanings given to terms defined herein shall be equally applicableto both the singular and plural forms of such terms.

# 2.             Grant of Security Interest.  As collateral security for the prompt and completepayment and performance when due (whether at the stated maturity, byacceleration or otherwise) of the Obligations, each Grantor hereby grants tothe Secured Party a security interest in all of the following property nowowned or at any time hereafter acquired by such Grantor or in which suchGrantor now has or at any time in the future may acquire any right, title orinterest (collectively, the “Collateral”):

|   | (i)    |   | all Receivable;              |
|--------|--------|--------|------------------------------|
|   | (ii)   |   | all Accounts;                |
|   | (iii)  |   | all Chattel Paper;           |
|   | (iv)   |   | all Copyrights;              |
|   | (v)    |   | all Copyright Licenses;      |
|   | (vi)   |   | all Deposit Accounts;        |
|   | (vii)  |   | all Documents;               |
|   | (viii) |   | all Equipment;               |
|   | (ix)   |   | all General Intangibles;     |
|   | (x)    |   | all Instruments;             |
|   | (xi)   |   | all Inventory;               |
|   | (xii)  |   | all Investment Property;     |
|   | (xiii) |   | all Letter of Credit Rights; |
|   | (xiv)  |   | all Patents;                 |

 

 

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|   | (xv)    |   | all Patent Licenses;                                                                                                                                                                                                                                                    |
|--------|---------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | (xvi)   |   | all Securities Accounts, and all Investment Property  held therein or credited thereto;                                                                                                                                                                                 |
|   | (xvii)  |   | all Trademarks;                                                                                                                                                                                                                                                         |
|   | (xviii) |   | all Trademark Licenses;                                                                                                                                                                                                                                                 |
|   | (xix)   |   | all Goods and other property not otherwise described  above;                                                                                                                                                                                                            |
|   | (xx)    |   | all books and records pertaining to the Collateral;                                                                                                                                                                                                                     |
|   | (xxi)   |   | to the extent not otherwise included, all Proceeds  and products of any and all of the foregoing, all Supporting Obligations in  respect of any of the foregoing, and all collateral security and guarantees  given by any Person with respect to any of the foregoing, |

provided, that the Collateral shall not include theExcluded Assets.

# 3.             Certain Matters RespectingReceivables.

## (a)             GrantorsRemain Liable under Receivables. Anything herein to the contrary notwithstanding, each Grantor shallremain liable under each of the Receivables to observe and perform all theconditions and obligations to be observed and performed by it thereunder, allin accordance with the terms of any agreement giving rise to each suchReceivable.  Secured Party shall not haveany obligation or liability under any Receivable (or any agreement giving risethereto) by reason of or arising out of this Agreement or the receipt by theSecured Party of any payment relating to such Receivable pursuant hereto, norshall the Secured Party be obligated in any manner to perform any of theobligations of any Grantor under or pursuant to any Receivable (or anyagreement giving rise thereto), to make any payment, to make any inquiry as tothe nature or the sufficiency of any payment received by it or as to thesufficiency of any performance by any party under any Receivable (or anyagreement giving rise thereto), to present or file any claim, to take anyaction to enforce any performance or to collect the payment of any amountswhich may have been assigned to it or to which it may be entitled at any timeor times.

## (b)           Communicationwith and Notice to Receivable Obligors. TheSecured Party may at any time communicate with obligors under the Receivablesto verify with them to the Secured Party’s satisfaction the existence, amountand terms of any Receivables. Upon the request of the Secured Party atany time after the occurrence and during the continuance of an Event ofDefault, each Grantor shall notify account debtors on the Receivables that theReceivables have been assigned to the Secured Party and that payments inrespect thereof shall be made directly to the Secured Party.

## (c)           Analysisof Receivables.  The Secured Partyshall have the right to make test verifications of the Receivables in anymanner and through any medium that it reasonably considers advisable, and eachGrantor shall furnish all such reasonable assistance and information as theSecured Party may require in connection therewith.  Not more than once per calendar year (orotherwise during the occurrence of an Event of Default), upon the Secured Party’srequest and at the expense of the Grantors, each Grantor shall causeindependent public accountants or others satisfactory to the Secured Party tofurnish to the Secured Party reports showing reconciliations, aging and testverifications of, and trial balances for, the Receivables.  The Secured Party may in its own name or inthe name of others communicate with account debtors on the Receivables toverify with them to its satisfaction the existence, amount and terms of anyReceivables.

## (d)           Collectionson Receivables.  Except as providedin clause (e) of this Section 3, the Secured Party hereby authorizes eachGrantor to collect the Receivables.  Ifrequired by the Secured Party at any time when an Event of Default shall haveoccurred and be continuing, any payments of Receivables, when collected by anyGrantor, shall be forthwith (and, in any event, within two Business 

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## Days) deposited by such Grantor in the exact form received, dulyendorsed by such Grantor to the Secured Party if required, in a specialcollateral account maintained by the Secured Party, subject to withdrawal bythe Secured Party only, as hereinafter provided, and, until so turned over,shall be held by such Grantor in trust for the Secured Party, segregated fromother funds of the Grantors.  Uponrequest, each Grantor shall provide a report identifying in reasonable detaileach deposit of any such Proceeds, including the nature and source of thepayments included in the deposit.  AllProceeds constituting collections of Receivables while held by the SecuredParty (or by any Grantor in trust for the Secured Party) shall continue to becollateral security for all of the Obligations and shall not constitute paymentthereof until applied as hereinafter provided. At such intervals as may be agreed upon by the Grantors and the SecuredParty, or, if an Event of Default shall have occurred and be continuing, at anytime at the Secured Party’s election, the Secured Party shall apply all or anypart of the funds on deposit in said Collateral Account on account of theObligations in such order as the Secured Party may elect, and any part of suchfunds which the Secured Party elects not so to apply and deems not required ascollateral security for the Obligations shall be paid over from time to time bythe Secured Party to the Grantors or to whomsoever may be lawfully entitled toreceive the same.  At the Secured Party’srequest, each Grantor shall deliver to the Secured Party all original and otherdocuments evidencing, and relating to, the agreements and transactions whichgave rise to the Receivables, including, without limitation, all originalorders, invoices and shipping receipts. Atany time during the continuance of an Event of Default, each Grantor willcooperate with the Secured Party toestablish a system of lockbox accounts, under the sole dominion and control ofthe Secured Party, into which allReceivables shall be paid and from which all collected funds will betransferred to a Collateral Account.

## (e)           ExcessCash Flow Receivables.  Upon theoccurrence of an Event of Default, the Secured Party shall establish the GMHFacility Account.  The GMH FacilityAccount shall be in the name of the Secured Party, shall be subject to the soledominion and control of the Secured Party, and no Grantor shall have any rightof withdrawal therefrom.  On or prior tothe Closing Date, the Borrower and each applicable Subsidiary shall haveexecuted and delivered the Excess Cash Flow Direction Letter.  Pursuant to the Excess Cash Flow DirectionLetter, all payments on Excess Cash Flow Receivables (which shall occur througha series of distributions as more particularly described in the Excess CashFlow Direction Letter) shall, from and after the occurrence of an Event ofDefault, be made by wire transfer directly to the GMH Facility Account.  The Secured Party shall retain all proceedsof the Excess Cash Flow Receivables in the GMH Facility Account and shall beentitled to apply them to the Obligations (whether matured or unmatured) insuch manner as the Secured Party may elect.

# 4.             Representations and Warranties.  Each Grantor hereby represents and warrantsthat:

## (a)           Title;No Other Liens.  Except for the Liensgranted to the Secured Party for the ratable benefit of the Secured Partypursuant to this Agreement, and the other Liens permitted to exist on theCollateral pursuant to the Loan Agreement, each Grantor owns each item of theCollateral free and clear of any and all Liens or claims of others.  No security agreement, financing statement orother public notice with respect to all or any part of the Collateral is onfile or of record in any public office, except such as may have been filed infavor of the Secured Party, for the ratable benefit of the Secured Party,pursuant to this Agreement or as may be permitted pursuant to the LoanAgreement.

## (b)           PerfectedFirst Priority Liens.  The Liensgranted pursuant to this Agreement will constitute perfected Liens in favor ofthe Secured Party in the Receivables and in the Collateral as collateralsecurity for the Obligations, (i) with respect to all Collateral, except asprovided in clauses (ii) and (iii) below, when financing statements have beenfiled in the offices in the jurisdictions where the Grantor is organized as setforth on Schedule I, (ii) solely with respect to Collateral constitutingInvestment Property evidenced by certificates, all of which are listed on ScheduleII, if any, when such 

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## certificates have been delivered to the Lender, and (iii) solely withrespect to Collateral consisting of the Deposit Accounts listed in ScheduleIII, if any, when each such Deposit Account becomes subject to theapplicable Account Control Agreement, which Liens are prior to all other Lienson the Collateral created by the Grantors and in existence on the date hereofand which are enforceable as such against all creditors of and purchasers fromany Grantor and against any owner or purchaser of the real property where anyof the Equipment or Inventory is located and any present or future creditorobtaining a Lien on such real property. To the extent the same constitutes Collateral, each Grantor shall causeeach of the Deposit Accounts and Security Accounts set forth on Schedule III,if any, to be subject to an Account Control Agreement on or before October       ,2006.

## (c)           Receivables.  The amount represented by each Grantor to theSecured Party from time to time as owing by each obligor or by all obligors inrespect of the Receivables will at such time be the correct amount actuallyowing by such obligor or obligors thereunder. No amount payable to any Grantor under or in connection with anyReceivable is evidenced by any Instrument or Chattel Paper which has not beendelivered to the Secured Party.  Theplace where each Grantor keeps its records concerning the Receivables isspecified for such Grantor on Schedule I.

## (d)           Inventoryand Equipment.  The Inventory and theEquipment are kept at the locations listed on Schedule IV hereto.

## (e)           ChiefExecutive Office.  Each Grantor’schief executive office and chief place of business is, and for the four (4)months preceding the date hereof has been, located at the place specified forsuch Grantor on Schedule I.

## (f)            Jurisdictionof Organization.  Each Grantor is a “registeredorganization” as defined in the Code and is organized as the type of entity, asunder the laws of the jurisdiction, specified for such Grantor on Schedule I.

## (g)           Name.  (i) The exact legal name of each Grantoris as specified for such Grantor on Schedule I; and (ii) no Grantorhas done business under a previous name, assumed name or trade name, except asspecified for such Grantor on Schedule I.

## (h)           FarmProducts.  None of the Collateralconstitutes, or is the Proceeds of, Farm Products.

## (i)            InsurancePolicies.  None of the Collateralconstitutes an interest or claim in or under any policy of insurance orcontract for annuity, except to the extent the same constitutes Proceeds.

## (j)            Copyrights,Patents and Trademarks.  ScheduleV hereto includes all Copyrights and Copyright Licenses owned by eachGrantor in its own name as of the date hereof. Schedule VI hereto includes all Patents and Patent Licenses ownedby each Grantor in its own name as of the date hereof.  Schedule VII hereto includes allTrademarks and Trademark Licenses owned by each Grantor in its own name as ofthe date hereof.  To the best of eachGrantor’s knowledge, each Copyright, Patent and Trademark is valid, subsisting,unexpired, enforceable and has not been abandoned.  Except as set forth in Schedules V, VIor VII, none of such Copyrights, Patents and Trademarks is the subjectof any licensing or franchise agreement. No holding, decision or judgment has been rendered by any GovernmentalAuthority which would limit, cancel or question the validity of any Copyright,Patent or Trademark.  Except as disclosedon Schedules V, VI or VII, no action or proceeding is pending (i)seeking to limit, cancel or question the validity of any Copyright, Patent orTrademark, or (ii) which, if adversely determined, would have a materialadverse effect on the value of any Copyright, Patent or Trademark.

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## (k)           GovernmentalObligors.  None of the obligors onany Receivables is a Governmental Authority.

## (l)            DepositAccounts and Securities Accounts. All Deposit Accounts and Securities Accounts with respect to each Grantorare listed on Schedule III, including the institution at which suchDeposit Account or Securities Account is established, the purpose thereof, thename thereon, and the account number thereof. Each Grantor agrees that at no time after the date that is fifteen (15)days after the Closing Date, may the aggregate amount of funds held in suchDeposit Accounts of the Grantors and Investment Property held in SecuritiesAccounts which are not subject to Account Control Agreements exceed $100,000;provided that this requirement shall not apply to amounts held in the payrollaccount to the extent such amounts are held therein solely for the purposes ofdisbursing payroll in a manner consistent with past practices (it beingunderstood that any cash and/or Investment Property held therein in excess ofthe amount required shall be transferred to a Deposit Account and/or SecuritiesAccount which is subject to an Account Control Agreement).  Each Grantor agrees that it will not transferassets out of any Securities Account, or transfer any Securities Account toanother securities intermediary, unless such Grantor, the Lender, and thesubstitute securities intermediary have entered into an Account ControlAgreement.  No arrangement contemplatedhereby or by any Account Control Agreement in respect of any Securities Accountor other Investment Property shall be modified by any Grantor without the priorwritten consent of the Lender.  Upon theoccurrence and during the continuance of an Event of Default, the Lender may notifyany securities intermediary to liquidate the applicable Securities Account orany related Investment Property maintained or held thereby and remit theproceeds thereof to an account specified by the Lender (including anyCollateral Account).

Each of theforegoing representations and warranties set forth in this Section 4 apply onlyto the extent that they are applicable to Collateral.

# 5.             Covenants.  Each Grantor covenants and agrees with theSecured Party that, from and after the date of this Agreement until theObligations are paid in full:

## (a)           Maintenanceof Perfected Security Interests; Further Documentation; Pledge of Instrumentsand Chattel Paper.  Each Grantorshall maintain the security interest created by this Agreement as a perfectedsecurity interest having at least the priority described in Section 4(b) hereofand shall defend such security interest against the claims and demands of allPersons whomsoever.  At any time and fromtime to time, upon the written request of the Secured Party, and at the soleexpense of the Grantors, each Grantor will promptly and duly execute anddeliver such further instruments and documents and take such further action asthe Secured Party may reasonably request for the purpose of obtaining orpreserving the full benefits of this Agreement and of the rights and powersherein granted, including, without limitation, (i) the filing of any financingor continuation statements under the Uniform Commercial Code in effect in anyjurisdiction with respect to the Liens created hereby and (ii) in the case ofInvestment Property, Deposit Accounts and any other relevant Collateral, takingany actions (including, without limitation, entering into, and using its bestefforts to cause any relevant third party to enter into, one or more controlagreements) necessary to enable the Secured Party to obtain “control” (withinthe meaning of the applicable Uniform Commercial Code) with respectthereto.  Each Grantor also herebyauthorizes the Secured Party to file any such financing or continuationstatement without the signature of the Grantors to the extent permitted byapplicable law.  Any such financingstatement may, at the option of the Secured Party, describe the propertycovered thereby and “all assets” or “all personal property” of such Grantor, ormay use a similar description.  A carbon,photographic or other reproduction of this Agreement shall be sufficient as afinancing statement for filing in any jurisdiction.  If any amount payable under or in connectionwith any of the Collateral shall be or become evidenced by any Instrument,Chattel Paper or Certified Security, such Instrument, Chattel Paper orCertified Security 

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## shall be immediately delivered to the Lender, duly endorsed in a mannersatisfactory to the Lender, to be held as Collateral pursuant to thisAgreement.

## (b)           Indemnification.  Each Grantor agrees, jointly and severally,to pay, and to save the Secured Party harmless from, any and all liabilities,costs and expenses (including, without limitation, reasonable legal fees andexpenses actually incurred) (i) with respect to, or resulting from, any delayin paying, any and all excise, sales or other taxes which may be payable ordetermined to be payable with respect to any of the Collateral, (ii) withrespect to, or resulting from, any delay in complying with any Requirement ofLaw applicable to any of the Collateral or (iii) in connection with any of thetransactions contemplated by this Agreement. In any suit, proceeding or action brought by the Secured Party under anyReceivable for any sum owing thereunder, or to enforce any provisions of anyReceivable, each Grantor will save, indemnify and keep the Secured Partyharmless from and against all expense, loss or damage suffered by reason of anydefense, setoff, counterclaim, recoupment or reduction or liability whatsoeverof the account debtor or obligor thereunder, arising out of a breach by anyGrantor of any obligation thereunder or arising out of any other agreement,indebtedness or liability at any time owing to or in favor of such accountdebtor or obligor or its successors from any Grantor.

## (c)           Maintenanceof Records.  Each Grantor will keepand maintain at its own cost and expense satisfactory and complete records ofthe Collateral, including, without limitation, a record of all paymentsreceived and all credits granted with respect to the Accounts.  To the extent requested by the Secured Party,each Grantor will mark its books and records pertaining to the Collateral to evidencethis Agreement and the security interests granted hereby.  Upon the occurrence and during thecontinuance of an Event of Default, each Grantor shall turn over any books andrecords pertaining to the Collateral to the Secured Party or to its representativesduring normal business hours at the request of the Secured Party.

## (d)           Rightof Inspection.  Upon reasonablenotice, the Secured Party shall at all times have full and free access duringnormal business hours to all the books, correspondence and records of eachGrantor, and the Secured Party or its respective representatives may examinethe same, take extracts therefrom and make photocopies thereof (subject tot ehterms of Section 10.24 of the Loan Agreement), and each Grantor agrees torender to the Secured Party, at the Grantors’ cost and expense, such clericaland other assistance as may be reasonably requested with regard thereto.  The Secured Party and its representativesshall, upon reasonable notice, also have the right during normal business hoursto enter into and upon any premises where any of the Inventory or Equipment islocated for the purpose of inspecting the same, observing its use or otherwiseprotecting its interests therein.

## (e)           Compliancewith Laws, etc.  Each Grantor willcomply in all material respects with all Applicable Laws applicable to theCollateral or any part thereof or to the operation of such Grantor’s business; provided,however, that each Grantor may contest any Applicable Laws in anyreasonable manner which shall not, in the reasonable opinion of the SecuredParty, adversely affect the Secured Party’s rights or the priority of its Lienson the Collateral.

## (f)            Compliancewith Terms of Contracts, etc.  EachGrantor will perform and comply in all material respects with all itsobligations under all its contractual obligations relating to the Collateral.

## (g)           Paymentof Obligations.  Each Grantor willpay promptly when due all taxes, assessments and governmental charges or leviesimposed upon the Collateral or in respect of its income or profits therefrom,as well as all claims of any kind (including, without limitation, claims forlabor, materials and supplies) against or with respect to the Collateral,except that no such charge need be paid if (i) the validity thereof is beingcontested in good faith by appropriate proceedings, (ii) such proceedings donot involve any material danger of the sale, forfeiture or loss of any of theCollateral or any interest 

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## therein and (iii) such charge is adequately reserved against on suchGrantor’s books in accordance with GAAP.

## (h)           Limitationon Liens on Collateral.  No Grantorwill create, incur or permit to exist, will defend the Collateral against, andwill take such other action as is necessary to remove, any Lien or claim on orto the Collateral, other than the liens created hereby and other than aspermitted pursuant to the Loan Agreement, and will defend the right, title andinterest of the Secured Party in and to any of the Collateral against theclaims and demands of all Persons whomsoever.

## (i)            Limitationson Dispositions of Collateral.  NoGrantor will sell, transfer, lease or otherwise dispose of any of theCollateral, or attempt, offer or contract to do so except for sales ofInventory in the ordinary course of its business or as otherwise permitted bythe Loan Agreement.

## (j)            Limitationson Modifications of Agreements Giving Rise to Receivables; Exercise of Rights;Notices.  No Grantor will (i) otherthan in the ordinary course of business as generally conducted by such Grantorover a period of time, amend, modify, terminate or waive any provision of anyagreement giving rise to a Receivable (including, in respect of the Excess CashFlow Receivables, any related mortgage loan documents) in any manner whichcould reasonably be expected to materially adversely affect the value of suchReceivable as Collateral, (ii) other than in the ordinary course of business asgenerally conducted by such Grantor over a period of time, fail to exercisepromptly and diligently each and every material right which it may have undereach agreement giving rise to a Receivable (other than any right oftermination) or (iii) fail to deliver to the Secured Party a copy of eachmaterial demand, notice or document received by it relating in any way to anyagreement giving rise to a material Receivable.

## (k)           Limitationson Discounts, Compromises, Extensions of Receivables.  Other than in the ordinary course of businessconsistent with its past practice, no Grantor will (i) grant any extensionof the time of payment of any Receivable, (ii) compromise, compound orsettle any Receivable for less than the full amount thereof,(iii) release, wholly or partially, any Person liable for the payment ofany Receivable, or (iv) allow any credit or discount whatsoever on anyReceivable.

## (l)            Maintenanceof Equipment.  Each Grantor willmaintain each item of Equipment in good operating condition, ordinary wear andtear and immaterial impairments of value and damage by the elements excepted,and will provide all maintenance, service and repairs necessary for such purpose,except that such Grantor’s obligations pursuant to this Section 5(l) shall notextend to obsolete Equipment.

## (m)          Maintenanceof Insurance.  Each Grantor willmaintain, with financially sound and reputable companies, insurance policies(i) insuring the Inventory and Equipment against loss by fire, explosion, theftand such other casualties as may be reasonably satisfactory to the SecuredParty in amounts comparable to amounts of insurance coverage obtained bysimilar businesses of similar size acting prudently and (ii) insuring eachGrantor and the Secured Party against liability for personal injury andproperty damage relating to such Inventory and Equipment, such policies to bein such form and amounts and having such coverage as shall be comparable to forms,amounts and coverage, respectively, obtained by similar businesses of similarsize acting prudently, with losses payable to any Grantor and the Secured Partyas its interest may appear or, in the case of liability insurance, showing theSecured Party as additional insured parties. Each Grantor shall deliver to the Secured Party a report of a reputableinsurance broker with respect to such insurance at the beginning of eachcalendar year and such supplemental reports with respect thereto as the SecuredParty may from time to time reasonably request.

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## (n)           FurtherIdentification of Collateral.  EachGrantor will furnish to the Secured Party from time to time statements andschedules further identifying and describing the Collateral and such otherreports in connection with the Collateral as the Secured Party may reasonablyrequest, all in reasonable detail.

## (o)           Notices.  Each Grantor will advise the Secured Partypromptly, in reasonable detail, at its address set forth in the Loan Agreement,(i) of any Lien (other than Liens created hereby or permitted under the LoanAgreement) on, or claim asserted against, any of the Collateral and (ii) of theoccurrence of any other event which could reasonably be expected to have amaterial adverse effect on the aggregate value of the Collateral or on theLiens created hereunder.

## (p)           Changesin Locations, Name, etc.  No Grantorwill, without giving the Secured Party reasonable advance notice of the same,(i) change the location of its jurisdiction of organization, as defined in theUniform Commercial Code of any relevant jurisdiction from that specified inSection 4(f) or remove its books and records concerning the Receivables fromthe location specified in Section 4(c), (ii) permit any of the Inventory orEquipment to be kept at a location other than those listed on Schedule IVhereto, (iii) change its name, identity or corporate or limited liabilitycompany structure or (iv) reorganize under the laws of another jurisdiction oras a different type of entity.

## (q)           Patents,Trademarks and Copyrights.

### (i)            Each Grantor (eitheritself or through licensees) will (i) continue to use each in a mannersufficient to maintain such Trademark in full force free from any claim ofabandonment for non-use, (ii) maintain as in the past the quality of productsand services offered under such Trademark, (iii) employ such Trademark with theappropriate notice of registration, (iv) not adopt or use any mark which isconfusingly similar or a colorable imitation of such Trademark unless theSecured Party, shall obtain a perfected security interest in such mark pursuantto this Agreement, and (v) not (and not permit any licensee or sublicenseethereof to) do any act or knowingly omit to do any act whereby any Trademarkmay become invalidated.

### (ii)           No Grantor will doany act, or omit to do any act, whereby any material Patent may becomeabandoned or dedicated.

### (iii)          Each Grantor(either itself or through licensees) will, for each work covered by a materialCopyright, continue to publish, reproduce, display, adopt and distribute thework with appropriate copyright notice as necessary and sufficient to establishand preserve such Grantor’s material rights under all applicable copyrightlaws.

### (iv)          Each Grantor willnotify the Secured Party immediately if it knows, or has reason to know, thatany material Patent, Trademark or Copyright or any application or registrationrelating to any thereof may become abandoned, lost or dedicated, or of anyadverse determination or development (including, without limitation, theinstitution of, or any such determination or development in, any proceeding inthe United States Patent and Trademark Office, the United States CopyrightOffice or any court or tribunal or similar office in any country) regardingsuch Grantor’s ownership of any Patent, Trademark or Copyright or its right toregister the same or to keep and maintain the same.

### (v)           Whenever anyGrantor, either by itself or through any agent, employee, licensee or designee,shall file an application for the registration of any Patent or Trademark withthe United States Patent and Trademark Office or any similar office or agencyin any other country or any political subdivision thereof, or shall file anapplication for registration of any Copyright with 

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### the United States Copyright Office or any similar office or agency inany other country or any political subdivision thereof, such Grantor shallreport such filing to the Secured Party within fifteen (15) Business Days.

### (vi)          Each Grantor shallfrom time to time execute and deliver any and all agreements, instruments, documents,and papers as the Secured Party may reasonably request (including, withoutlimitation, one or more Notice of Security Interest in Patents, one or moreMemorandum of Security Agreement - Trademarks and one or more CopyrightSecurity Agreements — Short Form, in each case in a form reasonably requestedby Secured Party and with appropriate completions and schedules) to evidencethe Secured Party’s security interest for the ratable benefit of the SecuredParty in any Patent, Trademark or Copyright and the goodwill and GeneralIntangibles of the Grantors relating thereto or represented thereby, and eachGrantor hereby constitutes the Secured Party its attorney-in-fact to executeand file all such writings for the foregoing purposes, all acts of such attorneybeing hereby ratified and confirmed, such power being coupled with an interestis irrevocable until the Obligations are paid in full.

### (vii)         Each Grantor willtake all reasonable and necessary steps, including, without limitation, in anyproceeding before the United States Patent and Trademark Office or the UnitedStates Copyright Office, or any similar office or agency in any other countryor any political subdivision thereof, to maintain and pursue each application(and to obtain the relevant registration) and to maintain each registration ofthe Patents, Trademarks and Copyrights, including, without limitation, timelyfiling of applications for renewal, affidavits of use and affidavits ofincontestability and payment of maintenance fees.

### (viii)        In the event thatany material Patent, Trademark or Copyright included in the Collateral isinfringed, misappropriated or diluted by a third party, each Grantor shallpromptly notify the Lender after it learns thereof and, at the Grantors’ soleexpense, shall, unless the Grantors shall reasonably determine that suchPatent, Trademark or Copyright is of negligible economic value to the Grantors,promptly sue for infringement, misappropriation or dilution, to seek injunctiverelief where appropriate and to recover any and all damages for suchinfringement, misappropriation or dilution, or take such other actions as theGrantors shall reasonably deem appropriate under the circumstances to protectsuch Patent, Trademark or Copyright.

### (ix)           Upon and during thecontinuance of an Event of Default and at the reasonable request of the SecuredParty, each Grantor shall use its reasonable efforts to obtain all requisiteconsents or approvals by the licensor of each Copyright License, Patent Licenseor Trademark License to effect the assignment of all of such Grantor’s rights,title and interest thereunder to the Secured Party or its designee.

## (r)    Inventory.  None ofthe Inventory of any Grantor shall be evidenced by a warehouse receipt.

# 6.             Agent’s Appointment asAttorney-in-Fact.

## (a)           Powers.  Each Grantor hereby irrevocably constitutesand appoints the Secured Party and any officer or agent thereof, with fullpower of substitution, as its true and lawful attorney-in-fact with fullirrevocable power and authority in the place and stead of each Grantor and inthe name of each Grantor or in its own name, from time to time in the SecuredParty’s discretion, for the purpose of carrying out the terms of thisAgreement, to take any and all appropriate action and to execute any and all documentsand instruments which may be necessary or desirable to accomplish the purposesof this 

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## Agreement, and, without limiting the generality of the foregoing, eachGrantor hereby gives the Secured Party the power and right, on behalf of eachGrantor, without notice to or assent by any Grantor, to do the following:

### (i)            in the name of eachGrantor or its own name, or otherwise, to take possession of and endorse andcollect any checks, drafts, notes, acceptances or other instruments for thepayment of moneys due under any Account, Instrument, Chattel Paper, GeneralIntangible or Excess Cash Flow Receivable or with respect to any otherCollateral and to file any claim or to take any other action or proceeding inany court of law or equity or otherwise deemed appropriate by the Secured Partyfor the purpose of collecting any and all such moneys due under any Account,Instrument, Chattel Paper, General Intangible or Excess Cash Flow Receivable orwith respect to any other Collateral whenever payable;

### (ii)           to pay or dischargetaxes and Liens levied or placed on or threatened against the Collateral, toeffect any repairs or any insurance called for by the terms of this Agreementand to pay all or any part of the premiums therefor and the costs thereof;

### (iii)          in the case of anyPatent, Trademark or Copyright, to execute and deliver any and all agreements,instruments, documents and papers as the Lender may request to evidence theLenders’ security interest in such Patent, Trademark or Copyright and thegoodwill and general intangibles of the Grantors relating thereto orrepresented thereby;

### (iv)          to execute, inconnection with any sale provided for in Section 9 hereof, any endorsements,assignments or other instruments of conveyance or transfer with respect to theCollateral; and

### (v)           (A) to direct anyparty liable for any payment under any of the Collateral to make payment of anyand all moneys due or to become due thereunder directly to the Secured Party oras the Secured Party shall direct; (B) to ask or demand for, collect, receivepayment of and receipt for, any and all moneys, claims and other amounts due orto become due at any time in respect of or arising out of any Collateral; (C)to sign and endorse any invoices, freight or express bills, bills of lading, storageor warehouse receipts, drafts against debtors, assignments, verifications,notices and other documents in connection with any of the Collateral; (D) tocommence and prosecute any suits, actions or proceedings at law or in equity inany court of competent jurisdiction to collect the Collateral or any thereofand to enforce any other right in respect of any Collateral; (E) to defend anysuit, action or proceeding brought against any Grantor with respect to anyCollateral; (F) to settle, compromise or adjust any such suit, action orproceeding and, in connection therewith, to give such discharges or releases asthe Secured Party may deem appropriate; and (G) to assign any Patent orTrademark (along with the goodwill of the business to which any such Trademarkpertains), throughout the world for such term or terms, on such conditions, andin such matter, as the Lender shall in its reasonable discretion determine; and(H) generally, to sell, transfer, pledge and make any agreement with respect toor otherwise deal with any of the Collateral as fully and completely as thoughthe Secured Party were the absolute owner thereof for all purposes, and to do,at the Secured Party’s option and the Grantors’ expense, at any time, or fromtime to time, all acts and things which the Secured Party deems necessary toprotect, preserve or realize upon the Collateral and the Secured Party’s, Liensthereon for the ratable benefit of the Secured Party and to effect the intentof this Agreement, all as fully and effectively as the Grantors might do.

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Anything in thisSection 6(a) to the contrary notwithstanding, the Secured Party agrees that itwill not exercise any rights under the power of attorney provided for in thisSection unless an Event of Default has occurred and is continuing.

Each Grantorhereby ratifies all that said attorneys shall lawfully do or cause to be doneby virtue hereof.  This power of attorneyis a power coupled with an interest and is irrevocable.

## (b)           NoDuty on Secured Party’s Part.  Thepowers conferred on the Secured Party hereunder are solely to protect theSecured Party’s interests in the Collateral and shall not impose any duty uponthe Secured Party to exercise any such powers. Secured Party shall be accountable only for amounts that it actuallyreceives as a result of the exercise of such powers, and neither it nor any oftheir officers, directors, employees or agents shall be responsible to anyGrantor for any act or failure to act hereunder, except for its own grossnegligence or willful misconduct.

# 7.             Performance by Secured Party ofGrantors’ Obligations.  If anyGrantor fails to perform or comply with any of its agreements contained herein,the Secured Party, at its option, but without any obligation to do so, mayitself, upon prior written notice to the Guarantors (which notice shall not berequired during the continuance of an Event of Default), perform or comply, orotherwise cause performance or compliance, with such agreement.  The actual out-of-pocket expenses of theSecured Party incurred in connection with such performance or compliance,together with interest thereon at a rate equal to the amount set forth in theLoan Agreement, shall be payable, jointly and severally, by the Grantors to theSecured Party on demand and shall constitute Obligations secured hereby.

# 8.             Proceeds.

## (a)           Inaddition to the rights of the Secured Party specified in Section 3(d) and (e)with respect to payments of Receivables, it is agreed that during an Event ofDefault all Proceeds received by any Grantor consisting of cash, checks andother near-cash items shall be held in an account subject to an Account ControlAgreement, or at Secured Party’s request, be held by the Grantors in trust forthe Secured Party, segregated from other funds of the Grantors, and shall, forthwithupon receipt by any Grantor, be turned over to the Secured Party in the exactform received by such Grantor (duly endorsed by such Grantor to the SecuredParty if required), and held by the Secured Party in a Collateral Accountmaintained under the sole dominion and control of the Secured Party.  Any and all such Proceeds held by the SecuredParty in a Collateral Account (or by any Grantor in trust for the SecuredParty) shall continue to be held as collateral security for the Obligations andshall not constitute payment thereof until applied as provided in this Section.

## (b)           Ifan Event of Default shall have occurred and be continuing, at any time at theSecured Party’s election, the Secured Party may apply all or any part of theProceeds constituting Collateral, whether or not held in any CollateralAccount, and any Proceeds of the Pledge Agreement, the Guarantee or any otherLoan Document, or otherwise received by the Secured Party, against theObligations (whether matured or unmatured), such application to bein such order as the SecuredParty shall elect, unless otherwise provided in the Loan Documents.  Any balance of such Proceeds remaining afterthe Obligations shall have been paid in full and the Loan Agreement terminatedshall be paid over to the Grantors or to whomsoever may be lawfully entitled toreceive the same.

# 9.             Remedies.  If an Event of Default shall occur and becontinuing, the Secured Party, may exercise, in addition to all other rightsand remedies granted to it in this Agreement and in any other instrument oragreement securing, evidencing or relating to the Obligations, all rights andremedies of a secured party under the Code. Without limiting the generality of the foregoing, the Secured Party,without demand of performance or other demand, presentment, protest,advertisement or notice of any 

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# kind (except any noticerequired by law referred to below) to or upon any Grantor or any other Person(all and each of which demands, defenses, advertisements and notices are herebywaived), may in such circumstances forthwith collect, receive, appropriate andrealize upon the Collateral, or any part thereof, and/or may forthwith sell,lease, assign, give option or options to purchase, or otherwise dispose of anddeliver the Collateral or any part thereof (or contract to do any of theforegoing), in one or more parcels at public or private sale or sales, at anyexchange, broker’s board or office of the Secured Party or elsewhere upon suchterms and conditions as it may deem advisable and at such prices as it may deembest, for cash or on credit or for future delivery without assumption of anycredit risk.  The Secured Party shallhave the right upon any such public sale or sales, and, to the extent permittedby law, upon any such private sale or sales, to purchase the whole or any partof the Collateral so sold, free of any right or equity of redemption in anyGrantor, which right or equity is hereby waived or released.  Each Grantor further agrees, at the SecuredParty’s request, to assemble the Collateral and make it available to theSecured Party at places which the Secured Party shall reasonably select,whether at any Grantor’s premises or elsewhere. The Secured Party shall apply the net proceeds of any such collection,recovery, receipt, appropriation, realization or sale, after deducting allreasonable and actual costs and expenses of every kind incurred therein orincidental to the care or safekeeping of any of the Collateral or in any wayrelating to the Collateral or the rights of the Secured Party arising out ofthe exercise by the Secured Party hereunder, including, without limitation,reasonable and actual attorneys’ fees and disbursements, to the payment inwhole or in part of the Obligations, in such order as the Secured Party may elect,unless otherwise provided in the Loan Documents, and only after suchapplication and after the payment by the Secured Party of any other amountrequired by any provision of law, including, without limitation, Section 9-615of the Code, need the Secured Party account for the surplus, if any, to theGrantors.  To the extent permitted byapplicable law, each Grantor waives all claims, damages and demands it mayacquire against the Secured Party arising out of the exercise by the SecuredParty of any of its rights hereunder.  Ifany notice of a proposed sale or other disposition of Collateral shall berequired by law, such notice shall be deemed reasonable and proper if given atleast 10 days before such sale or other disposition.  Each Grantor shall remain liable for anydeficiency if the proceeds of any sale or other disposition of the Collateralare insufficient to pay the Obligations and the fees and disbursements of anyattorneys employed by the Secured Party to collect such deficiency.

# 10.           Grant of License to Use Patent,Trademark and Copyright Collateral. For the purpose of enabling the Secured Party to exercise rights andremedies under Section 9 hereof at such time as the Secured Party shall belawfully entitled to exercise such rights and remedies, each Grantor herebygrants to the Secured Party an irrevocable, non-exclusive license (exercisablewithout payment of royalty or other compensation to any Grantor) to use,license or sublicense any of the Copyrights, Patents and Trademarks, now ownedor hereafter acquired by any Grantor, and wherever the same may be located, andincluding in such license reasonable access to all media in which any of thelicensed items may be recorded or stored. The use of such license by the Secured Party shall be exercised, at theoption of the Secured Party for any purpose appropriate in connection with theexercise of remedies hereunder, only upon the occurrence and during thecontinuance of an Event of Default; provided that any license,sublicense or other transaction entered into by the Secured Party in accordanceherewith shall be binding upon each Grantor notwithstanding any subsequent cureof an Event of Default.  The SecuredParty agrees to apply the net proceeds received from any license as provided inSection 8 hereof.

# 11.           Limitation on Duties RegardingPresentation of Collateral.  TheSecured Party’s sole duty with respect to the custody, safekeeping and physicalpreservation of the Collateral in its possession, under Section 9-207 of theCode or otherwise, shall be to deal with it in the same manner as the SecuredParty deals with similar property for its own account. Neither the SecuredParty nor any of its directors, officers, employees, agents or advisors shallbe liable for failure to demand, collect or realize upon all or any part of theCollateral or for any delay in doing so or shall be under any obligation tosell or otherwise dispose of any Collateral upon the request of any Grantor orany other Person or to take any

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# other action whatsoeverwith regard to the Collateral or any part thereof.  The powers conferred on the Secured Partyhereunder are solely to protect the Secured Party’s interests in the Collateraland shall not impose any duty upon the Secured Party or any Secured Party toexercise any such powers.  The SecuredParty shall be accountable only for amounts that it actually receives as aresult of the exercise of such powers, and neither it nor any of its officers,directors, employees, agents or advisors shall be responsible to any Grantor forany act or failure to act hereunder, except for their own gross negligence orwillful misconduct.

# 12.           Powers Coupled with an Interest.  All authorizations and agencies hereincontained with respect to the Collateral are irrevocable and powers coupled withan interest.

# 13.           Execution of Financing Statements.  Pursuant to Section 9-402 of the Code, eachGrantor hereby authorizes the Secured Party to file financing statements withrespect to the Collateral without the signature of such Grantor in such form andin such filing offices as the Secured Party reasonably determined appropriateto perfect the security interests of the Secured Party under thisAgreement.  A carbon, photographic orother reproduction of this Agreement shall be sufficient as a financingstatement for filing in any jurisdiction.

# 14.           Notices.  Notices, requests and demands to or upon theSecured Party or any Grantor hereunder shall be effected in the manner setforth in Section 10.6 of the Loan Agreement.

# 15.           Severability.  Any provision of this Agreement which isprohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,be ineffective to the extent of such prohibition or unenforceability withoutinvalidating the remaining provisions hereof, and any such prohibition orunenforceability in any jurisdiction shall not invalidate or renderunenforceable such provision in any other jurisdiction.

# 16.           Paragraph Headings.  The paragraph headings used in this Agreementare for convenience of reference only and are not to affect the constructionhereof or be taken into consideration in the interpretation hereof.

# 17.           No Waiver; Cumulative Remedies.Secured Party shall not by any act (except by a written instrument pursuant toSection 18 hereof), delay, indulgence, omission or otherwise be deemed to havewaived any right or remedy hereunder or to have acquiesced in any Default orEvent of Default or in any breach of any of the terms and conditionshereof.  No failure to exercise, nor anydelay in exercising, on the part of the Secured Party, any right, power orprivilege hereunder shall operate as a waiver thereof.  No single or partial exercise of any right,power or privilege hereunder shall preclude any other or further exercisethereof or the exercise of any other right, power or privilege.  A waiver by the Secured Party of any right orremedy hereunder on any one occasion shall not be construed as a bar to anyright or remedy which the Secured Party would otherwise have on any futureoccasion.  The rights and remedies hereinprovided are cumulative, may be exercised singly or concurrently and are notexclusive of any rights or remedies provided by law.

# 18.           Waivers and Amendments; Successorsand Assigns; Governing Law.  None ofthe terms or provisions of this Agreement may be waived, amended, supplementedor otherwise modified except by a written instrument executed by each Grantorand the Secured Party, provided that any provision of this Agreement may bewaived by the Secured Party in a written instrument executed by the Secured Party.  This Agreement shall be binding upon thesuccessors and assigns of each Grantor and shall inure to the benefit of theSecured Party, its successors and assigns. This Agreement shall be governed by, and construed and interpreted inaccordance with, the laws of the State of New York.

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[SIGNATURE PAGESIMMEDIATELY FOLLOW]

 

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IN WITNESS WHEREOF, eachGrantor has caused this Agreement to be duly executed and delivered as of thedate first above written.

 
|        |   |   |   | GRANTOR:                                             |
|--------|--------|--------|--------|------------------------------------------------------|
|   |   |   |   |                                                 |
|   |   |   |   |                                                 |
|   |   |   |   | GMH COMMUNITIES, LP, a Delaware limited  partnership |
|   |   |   |   |                                                 |
|   |   | By:    |   | /s/ Joseph Macchione                                 |   |
|   |   |   |   | Name:                                                | Joseph Macchione |
|   |   |   |   | Title:                                               | Vice President & Secretary |
|        |        |        |        |                                                      |  |  |

 
|        |   |   |   |                              |
|--------|--------|--------|--------|-----------------------------------|
|   |   |   |   |                              |
|   |   |   |   | COLLEGE PARK MANAGEMENT LLC, a    |
|   |   |   |   | Florida limited liability company |
|   |   |   |   |                              |
|   |   | By:    |   | /s/ Joseph   Macchione       |   |
|   |   |   |   | Name:                             | John Ferer |
|   |   |   |   | Title:                            | Assistant Vice President |
|        |        |        |        |                                   |  |  |

 
|        |   |   |   |                               |
|--------|--------|--------|--------|------------------------------------|
|   |   |   |   |                               |
|   |   |   |   | COLLEGE PARK MANAGEMENT TRS, INC., |
|   |   |   |   | a Delaware Corporation             |
|   |   |   |   |                               |
|   |   | By:    |   | /s/ John Ferer                     |   |
|   |   |   |   | Name:                              | John Ferer |
|   |   |   |   | Title:                             | Assistant Vice President |
|        |        |        |        |                                    |  |  |

 

----

 
|        |   |   |   |                                  |
|--------|--------|--------|--------|---------------------------------------|
|   |   |   |   |                                  |
|   |   |   |   | GMH MILITARY HOUSING, LLC, a Delaware |
|   |   |   |   | limited liability company             |
|   |   |   |   |                                  |
|   |   | By:    |   | /s/ John Ferer                        |   |
|   |   |   |   | Name:                                 | John Ferer |
|   |   |   |   | Title:                                | Assistant Vice President |
|        |        |        |        |                                       |  |  |

 
|        |   |   |   |                              |
|--------|--------|--------|--------|-----------------------------------|
|   |   |   |   |                              |
|   |   |   |   | GMH MILITARY HOUSING INVESTMENTS  |
|   |   |   |   | LLC, a Delaware limited liability |
|   |   |   |   |                              |
|   |   | By:    |   | /s/ John Ferer                    |   |
|   |   |   |   | Name:                             | John Ferer |
|   |   |   |   | Title:                            | Assistant Vice President |
|        |        |        |        |                                   |  |  |

 
|        |   |   |   |                                  |
|--------|--------|--------|--------|---------------------------------------|
|   |   |   |   |                                  |
|   |   |   |   | GMH COMMUNITIES TRS, INC., a Delaware |
|   |   |   |   | corporation                           |
|   |   |   |   |                                  |
|   |   | By:    |   | /s/ Joseph Macchione                  |   |
|   |   |   |   | Name:                                 | Joseph Macchione |
|   |   |   |   | Title:                                | Vice President |
|        |        |        |        |                                       |  |  |

 
|        |   |   |   |                                   |
|--------|--------|--------|--------|----------------------------------------|
|   |   |   |   |                                   |
|   |   |   |   | GMH COMMUNITIES TRUST, a Maryland real |
|   |   |   |   | estate investment trust                |
|   |   |   |   |                                   |
|   |   | By:    |   | /s/ Joseph Macchione                   |   |
|   |   |   |   | Name:                                  | Joseph Macchione |
|   |   |   |   | Title:                                 | Executive Vice President & Secretary |
|        |        |        |        |                                        |  |  |

 

----

 
|        |   |   |   |                              |
|--------|--------|--------|--------|-----------------------------------|
|   |   |   |   |                              |
|   |   |   |   | GMH COMMUNITIES SERVICES, INC., a |
|   |   |   |   | Delaware corporation              |
|   |   |   |   |                              |
|   |   | By:    |   | /s/ Joseph Macchione              |   |
|   |   |   |   | Name:                             | Joseph Macchione |
|   |   |   |   | Title:                            | Vice President |
|        |        |        |        |                                   |  |  |

 

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**ScheduleI**

**NAMES, FORM OF ORGANIZATION ANDLOCATION OF GRANTORS**

Legal Name: GMHCommunities, LPType of Organization: Limited PartnershipState of Incorporation/Organization: DelawarePrior Names: NoneChief Executive Office/Chief Place of Business and Location where Grantormaintains Receivables records:  10 CampusBoulevard, Newtown Square, PA  19073

Legal Name: College ParkManagement, LLCType of Organization: Limited Liability CompanyState of Incorporation/Organization: FloridaPrior Names: NoneChief Executive Office/Chief Place of Business and Location where Grantormaintains Receivables records:  10 CampusBoulevard, Newtown Square, PA  19073

Legal Name: GMHCommunities Services, Inc.Type of Organization: CorporationState of Incorporation/Organization: DelawarePrior Names: NoneChief Executive Office/Chief Place of Business and Location where Grantormaintains Receivables records: 10 Campus Boulevard, NewtownSquare, PA  19073

Legal Name:  GMH Communities TrustType of Organization:  Real EstateInvestment TrustState of Incorporation/Organization: MarylandPrior Names: NoneChief Executive Office/Chief Place of Business and Location where Grantormaintains Receivables records:  10 CampusBoulevard, Newtown Square, PA  19073

Legal Name: GMHCommunities TRS, Inc.Type of Organization:  CorporationState of Incorporation/Organization: DelawarePrior Names: NoneChief Executive Office/Chief Place of Business and Location where Grantormaintains Receivables records:  10 CampusBoulevard, Newtown Square, PA  19073

Legal Name:  GMH Military Housing, LLCType of Organization:  Limited LiabilityCompanyState of Incorporation/Organization: DelawarePrior Names: NoneChief Executive Office/Chief Place of Business and Location where Grantormaintains Receivables records:  10 CampusBoulevard, Newtown Square, PA  19073

----

Legal Name:  GMH Military Housing Investments, LLCType of Organization:  Limited LiabilityCompanyState of Incorporation/Organization: DelawarePrior Names: NoneChief Executive Office/Chief Place of Business and Location where Grantormaintains Receivables records:  10 CampusBoulevard, Newtown Square, PA  19073

Legal Name:  College Park Management TRS, Inc.Type of Organization:  CorporationState of Incorporation/Organization: DelawarePrior Names: NoneChief Executive Office/Chief Place of Business and Location where Grantormaintains Receivables records:  10 CampusBoulevard, Newtown Square, PA  19073

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**Schedule II**

**InvestmentProperty**

**College Park Management, LLC**

     Money Market account — 2000018262980  (Wachovia)

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**Schedule III**

**DepositAccounts**

**GMHCommunities, LP**

Central depositoryaccount/ZBA is tied to this account - 2000012962189 (Wachovia)

Payroll account -2000012962192 (Wachovia)

ZBA clearingaccount  - 2000012962215 (Wachovia)

Bank account to beclosed (unknown as to purpose) - 2000018262980 (Wachovia)

**College Park Management TRS, Inc**.

        Merrill Lynch — checking account —216-07702

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**Schedule IV**

**Inventoryand Equipment**

The Grantors ownvarious items of equipment and inventory used in the normal course of theirrespective operations. With respect to the student and military housingsegments, the properties and projects operate inventory and equipment (such ascomputers, office equipment, tanning beds, televisions, game room-relateditems, furniture and appliances) that are located on the site of the propertyand are primarily owned by the property-level entity with respect to suchproperty; however, some items may be owned through the direct purchase by GMHCommunities, LP. With respect to the corporate operations of GMH CommunitiesTrust, general office-related equipment located at the corporate headquartersbuilding is generally owned by GMH Communities, LP.

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**Schedule V**

**Copyrights,Copyright Licenses**

None.

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**ScheduleVI**

**Patentsand Patent Licenses**

None.

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**ScheduleVII**

**Trademarksand Trademark Licenses**

See attached Schedule A.

 

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