Exhibit 10.1


EXECUTION COPY







AMENDED AND RESTATED CREDIT AGREEMENT


Dated as of February 28, 2007


by and among

	
  
DIAMONDROCK HOSPITALITY LIMITED PARTNERSHIP,
  
	
   
 	
  
as Borrower,
  
	
   
 	
  
 
  
	
   
 	
  
 
  
	
  
DIAMONDROCK HOSPITALITY COMPANY,
  
	
   
 	
  
as Parent,
  
	
   
 	
  
 
  
	
   
 	
  
 
  
	
  
WACHOVIA CAPITAL MARKETS, LLC,
  
	
   
 	
  as Sole Lead   Arranger
  
	
   
 	
  
           and
  
	
   
 	
  
as Book   Manager,
  
	
   
 	
  
 
  
	
   
 	
  
 
  
	
  
WACHOVIA BANK, NATIONAL ASSOCIATION,
  
	
   
 	
  
as   Administrative Agent,
  
	
   
 	
  
 
  
	
   
 	
  
 
  
	
  
Each of
  
	
  
BANK OF AMERICA, N.A.,
  
	
  
CALYON NEW YORK BRANCH
  
	
  
and
  
	
  
THE ROYAL BANK OF SCOTLAND PLC,
  
	
   
 	
  as a   Syndication Agent,
  
	
   
 	
   
  
	
   
 	
   
  
	
  CITICORP NORTH AMERICA, INC.,
  
	
   
 	
  as   Documentation Agent,
  
	
   
 	
   
  
	
   
 	
   
  
	
  and
  
	
   
 
	
   
 
	
  THE FINANCIAL INSTITUTIONS INITIALLY SIGNATORY HERETO
  
	
  AND THEIR ASSIGNEES PURSUANT TO SECTION 13.5.,
  
	
   
 	
  as Lenders
  















TABLE OF CONTENTS

	
  
Article I.   Definitions
  	
  
 
  	
  
1
  
	  
	  
	  

	
  
 
  	
  
Section 1.1.  Definitions.
  	
  
 
  	
  
1
  
	
   
  	
  
Section 1.2.  General; References to Times.
  	
  
 
  	
  
24
  
	
  
 
  	
  
Section 1.3.  Financial Attributes of Non-Wholly Owned
Subsidiaries.
 	
  
 
  	
  
25
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
Article II.   Credit Facility
  	
  
 
  	
  
25
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
Section 2.1.  Revolving Loans.
  	
  
 
  	
  
25
  
	
   
  	
  
Section 2.2.  Swingline Loans.
  	
  
 
  	
  
26
  
	
  
 
  	
  
Section 2.3.  Letters of Credit.
  	
  
 
  	
  
28
  
	
  
 
  	
  
Section 2.4.  Rates and Payment of Interest on Loans.
  	
  
 
  	
  
32
  
	
  
 
  	
  
Section 2.5.  Number of Interest Periods.
  	
  
 
  	
  
33
  
	
  
 
  	
  
Section 2.6.  Repayment of Loans.
  	
  
 
  	
  
33
  
	
  
 
  	
  
Section 2.7.  Prepayments.
  	
  
 
  	
  
33
  
	
   
  	
  
Section 2.8.  Continuation.
  	
  
 
  	
  
34
  
	
  
 
  	
  
Section 2.9.  Conversion.
  	
  
 
  	
  
34
  
	
  
 
  	
  
Section 2.10.  Notes.
  	
  
 
  	
  
35
  
	
  
 
  	
  
Section 2.11.  Voluntary Reductions of the Commitment.

	
  
 
  	
  
35
  
	
  
 
  	
  
Section 2.12.  Extension of Termination Date.
 	
  
 
  	
  
36
  
	
  
 
  	
  
Section 2.13.  Expiration or Maturity Date of Letters of Credit Past
Termination Date.
 	
  
 
  	
  
36
  
	
   
  	
  
Section 2.14.  Amount Limitations.
 	
  
 
  	
  
36
  
	
  
 
  	
  
Section 2.15.  Increase of Commitments.
 	
  
 
  	
  
36
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
Article III. Payments, Fees and Other General Provisions
 	
  
 
  	
  
37
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
Section 3.1.  Payments.
  	
  
 
  	
  
37
  
	
   
  	
  
Section 3.2.  Pro Rata Treatment.
  	
  
 
  	
  
38
  
	
  
 
  	
  
Section 3.3.  Sharing of Payments, Etc.
  	
  
 
  	
  
38
  
	
  
 
  	
  
Section 3.4.  Several Obligations.
  	
  
 
  	
  
39
  
	
  
 
  	
  
Section 3.5.  Minimum Amounts.
  	
  
 
  	
  
39
  
	
  
 
  	
  
Section 3.6.  Fees.
  	
  
 
  	
  
39
  
	
  
 
  	
  
Section 3.7.  Computations.
 	
  
 
  	
  
40
  
	
   
  	
  
Section 3.8.  Usury.
  	
  
 
  	
  
41
  
	
  
 
  	
  
Section 3.9.  Agreement Regarding Interest and Charges.

	
  
 
  	
  
41
  
	
  
 
  	
  
Section 3.10.  Statements of Account.
 	
  
 
  	
  
41
  
	
  
 
  	
  
Section 3.11.  Defaulting Lenders.
 	
  
 
  	
  
41
  
	
  
 
  	
  
Section 3.12.  Taxes.
 	
  
 
  	
  
43
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  Article IV.  Unencumbered Borrowing Base Properties
 	
  
 
  	
  
44
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
Section 4.1.  Eligibility of Properties.
 	
  
 
  	
  
44
  
	
  
 
  	
  
Section   4.2.  Reclassification of Properties.
  	
  
 
  	
  
46
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
Article V.   Yield Protection, Etc.
  	
  
 
  	
  
47
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
   
  	
  
Section 5.1.  Additional Costs; Capital Adequacy.
  	
  
 
  	
  
47
  
	
  
 
  	
  
Section 5.2.  Suspension of LIBOR Loans.
  	
  
 
  	
  
48
  




- i -









	
  
 
  	
  
Section 5.3.  Illegality.
  	
  
 
  	
  
49
  
	
  
 
  	
  
Section 5.4.  Compensation.
  	
  
 
  	
  
49
  
	
   
  	
  
Section 5.5.  Treatment of Affected Loans.
  	
  
 
  	
  
49
  
	
  
 
  	
  
Section 5.6.  Change of Lending Office.
  	
  
 
  	
  
50
  
	
  
 
  	
  
Section 5.7.  Assumptions Concerning Funding of LIBOR
Loans.
 	
  
 
  	
  
50
  
	
  
 
  	
  
Section 5.8.  Affected Lenders.
  	
  
 
  	
  
50
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
Article VI.   Conditions Precedent
  	
  
 
  	
  
51
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
Section 6.1.  Initial Conditions Precedent.
  	
  
 
  	
  
51
  
	
  
 
  	
  
Section 6.2.  Conditions Precedent to All Loans and Letters of
Credit.
 	
  
 
  	
  
53
  
	
  
 
  	
  
Section 6.3.  Conditions Subsequent.
  	
  
 
  	
  
54
  
	  
	  
	  
	  

	

  
  Article VII.   Representations and Warranties
	
  
 
  	
  
54
  
	  
	  
	  
	  

	
  
 
  	
  
Section 7.1.  Representations and Warranties.
  	
  
 
  	
  
54
  
	
   
  	
  
Section 7.2.  Survival of Representations and Warranties,
Etc.
 	
  
 
  	
  
60
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
Article   VIII. Affirmative Covenants
  	
  
 
  	
  
60
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
Section 8.1.  Preservation of Existence and Similar
Matters.
 	
  
 
  	
  
60
  
	
  
 
  	
  
Section 8.2.  Compliance with Applicable Law and Material
Contracts.
 	
  
 
  	
  
61
  
	
   
  	
  
Section 8.3.  Maintenance of Property.
  	
  
 
  	
  
61
  
	
  
 
  	
  
Section 8.4.  Conduct of Business.
 	
  
 
  	
  
61
  
	
  
 
  	
  
Section 8.5.  Insurance.
  	
  
 
  	
  
61
  
	
  
 
  	
  
Section 8.6.  Payment of Taxes and Claims.
 	
  
 
  	
  
61
  
	
  
 
  	
  
Section 8.7.  Visits and Inspections.
  	
  
 
  	
  
62
  
	
  
 
  	
  
Section 8.8.  Use of Proceeds; Letters of Credit.
 	
  
 
  	
  
62
  
	
   
  	
  
Section 8.9.  Environmental Matters.
 	
  
 
  	
  
62
  
	
  
 
  	
  
Section 8.10.  Books and Records.
 	
  
 
  	
  
63
  
	
  
 
  	
  
Section 8.11.  Further Assurances.
 	
  
 
  	
  
63
  
	
  
 
  	
  
Section   8.12.  REIT Status.
  	
  
 
  	
  
63
  
	
  
 
  	
  
Section 8.13.  Exchange Listing.
  	
  
 
  	
  
63
  
	
  
 
  	
  
Section 8.14.  Additional Guarantors.
  	
  
 
  	
  
63
  
	
   
  	
  
Section 8.15.  Release of Guarantors.
  	
  
 
  	
  
64
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
Article IX.   Information
  	
  
 
  	
  
64
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
Section 9.1.  Quarterly Financial Statements.
  	
  
 
  	
  
65
  
	
  
 
  	
  
Section 9.2.  Year-End Statements.
  	
  
 
  	
  
65
  
	
   
  	
  
Section 9.3.  Compliance Certificate.
  	
  
 
  	
  
65
  
	
  
 
  	
  
Section 9.4.  Other Information.
  	
  
 
  	
  
66
  
	
  
 
  	
  
Section 9.5.  Electronic Delivery of Certain Information.

	
  
 
  	
  
68
  
	
  
 
  	
  
Section 9.6.  Public/Private Information.
  	
  
 
  	
  
69
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
Article X.   Negative Covenants
  	
  
 
  	
  
70
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
Section 10.1.  Financial Covenants.
  	
  
 
  	
  
70
  
	
  
 
  	
  
Section 10.2.  Restricted Payments.
  	
  
 
  	
  
71
  
	
  
 
  	
  
Section 10.3.  Indebtedness.
  	
  
 
  	
  
71
  
	
  
 
  	
  
Section 10.4.   Certain Permitted Investments.
  	
  
 
  	
  
71
  
	
  
 
  	
  
Section 10.5.  Investments Generally.
  	
  
 
  	
  
72
  



- ii -









	
  
 
  	
  
Section 10.6.  Liens; Negative Pledges; Other Matters.
  	
  
 
  	
  
72
  
	
  
 
  	
  
Section 10.7.  Merger, Consolidation, Sales of Assets and Other
Arrangements.
 	
  
 
  	
  
73
  
	
  
 
  	
  
Section 10.8.  Fiscal Year.
  	
  
 
  	
  
74
  
	
  
 
  	
  
Section 10.9.  Modifications to Material Contracts.
 	
  
 
  	
  
74
  
	
   
  	
  
Section 10.10.  Modifications of Organizational Documents.
  	
  
 
  	
  
74
  
	
  
 
  	
  
Section 10.11.  Transactions with Affiliates.
 	
  
 
  	
  
75
  
	
  
 
  	
  
Section 10.12.  ERISA Exemptions.
  	
  
 
  	
  
75
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
Article XI.   Default
  	
  
 
  	
  
75
  
	
  
 
  	
  
 
  	
  
 
  
	
   
  	
  
Section 11.1.  Events of Default.
  	
  
 
  	
  
75
  
	
  
 
  	
  
Section 11.2.  Remedies Upon Event of Default.
 	
  
 
  	
  
78
  
	
  
 
  	
  
Section 11.3.  Remedies Upon Default.
  	
  
 
  	
  
80
  
	
  
 
  	
  
Section 11.4.  Allocation of Proceeds.
 	
  
 
  	
  
80
  
	
  
 
  	
  
Section 11.5.  Collateral Account.
  	
  
 
  	
  
81
  
	
  
 
  	
  
Section 11.6.  Performance by Agent.
  	
  
 
  	
  
82
  
	
   
  	
  
Section 11.7.  Rights Cumulative.
 	
  
 
  	
  
82
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
Article XII.   The Agent
  	
  
 
  	
  
82
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
Section 12.1.  Authorization and Action.
  	
  
 
  	
  
82
  
	
  
 
  	
  
Section 12.2.  Agent’s Reliance, Etc.
 	
  
 
  	
  
83
  
	
   
  	
  
Section 12.3.  Notice of Defaults.
  	
  
 
  	
  
83
  
	
  
 
  	
  
Section 12.4.  Wachovia as Lender.
 	
  
 
  	
  
84
  
	
  
 
  	
  
Section   12.5.  Approvals of Lenders.
  	
  
 
  	
  
84
  
	
  
 
  	
  
Section 12.6.  Lender Credit Decision, Etc.
 	
  
 
  	
  
85
  
	
  
 
  	
  
Section 12.7.  Indemnification of Agent.
  	
  
 
  	
  
85
  
	
  
 
  	
  
Section 12.8.  Successor Agent.
 	
  
 
  	
  
86
  
	
   
  	
  
Section   12.9.  Titled Agents.
  	
  
 
  	
  
87
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
Article   XIII. Miscellaneous
  	
  
 
  	
  
87
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
Section 13.1.  Notices.
  	
  
 
  	
  
87
  
	
  
 
  	
  
Section 13.2.  Expenses.
  	
  
 
  	
  
88
  
	
   
  	
  
Section 13.3.  Setoff.
  	
  
 
  	
  
89
  
	
  
 
  	
  
Section 13.4.  Litigation; Jurisdiction; Other Matters;
Waivers.
 	
  
 
  	
  
89
  
	
  
 
  	
  
Section 13.5.  Successors and Assigns.
  	
  
 
  	
  
90
  
	
  
 
  	
  
Section 13.6.  Amendments.
  	
  
 
  	
  
92
  
	
  
 
  	
  
Section 13.7.  Nonliability of Agent and Lenders.
 	
  
 
  	
  
94
  
	
  
 
  	
  
Section 13.8.  Confidentiality.
  	
  
 
  	
  
94
  
	
   
  	
  
Section 13.9.  Indemnification.
 	
  
 
  	
  
95
  
	
  
 
  	
  
Section 13.10.  Termination; Survival.
 	
  
 
  	
  
97
  
	
  
 
  	
  
Section 13.11.  Severability of Provisions.
  	
  
 
  	
  
97
  
	
  
 
  	
  
Section 13.12.  GOVERNING LAW.
 	
  
 
  	
  
97
  
	
  
 
  	
  
Section 13.13.  Patriot Act.
 	
  
 
  	
  
97
  
	
  
 
  	
  
Section 13.14.  Counterparts.
 	
  
 
  	
  
98
  
	
   
  	
  
Section 13.15.  Obligations with Respect to Loan Parties.

	
  
 
  	
  
98
  
	
  
 
  	
  
Section 13.16.  Limitation of Liability.
 	
  
 
  	
  
98
  
	
  
 
  	
  
Section 13.17.  Entire Agreement.
 	
  
 
  	
  
98
  
	
  
 
  	
  
Section 13.18.  Construction.
  	
  
 
  	
  
98
  
	
  
 
  	
  
Section 13.19.  No Novation.
 	
  
 
  	
  
99
  




- iii -










	
  
SCHEDULE 1.1.(A)
 	
  
Capitalization   Rates
  
	
  
SCHEDULE   1.1.(B)
  	
  
List of Loan   Parties
  
	
  
SCHEDULE   4.1.
  	
  
Initial   Unencumbered Borrowing Base Properties
  
	
  
SCHEDULE   7.1.(b)
  	
  
Ownership   Structure
  
	
  
SCHEDULE   7.1.(f)
  	
  
Title to   Properties; Liens
  
	
  
SCHEDULE   7.1.(g)
  	
  
Indebtedness   and Guaranties
  
	
  
SCHEDULE   7.1.(h)
  	
  
Material   Contracts
  
	
  
SCHEDULE   7.1.(i)
  	
  
Litigation
  
	
  
 
  	
  
 
  
	
   
  	
  
 
  
	
  
EXHIBIT A
  	
  
Form of   Assignment and Acceptance Agreement
  
	
  
EXHIBIT B
  	
  
Form of   Guaranty
  
	
  
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   Revolving Note
  
	
  
EXHIBIT I
  	
  
Form of   Opinion of Counsel
  
	
  EXHIBIT J
  	
  
Form of   Compliance Certificate
  
	
  
 
  	
  
 
  




- iv -










          THIS AMENDED AND
RESTATED CREDIT AGREEMENT (this “Agreement”) dated as of
February 28, 2007 by and among DIAMONDROCK HOSPITALITY LIMITED PARTNERSHIP,
a limited partnership formed under the laws of the State of Delaware (the
“Borrower”), DIAMONDROCK HOSPITALITY COMPANY, a corporation formed
under the laws of the State of Maryland (the “Parent”), each of the
financial institutions initially a signatory hereto together with their
assignees pursuant to Section 13.5.(d), WACHOVIA BANK, NATIONAL
ASSOCIATION, as Agent, WACHOVIA CAPITAL MARKETS, LLC, as Sole Lead Arranger (the
“Sole Lead Arranger”) and as Book Manager (the “Book
Manager”), each of BANK OF AMERICA, N.A., CALYON NEW YORK BRANCH and THE
ROYAL BANK OF SCOTLAND PLC, as a Syndication Agent (each a “Syndication
Agent”), and CITICORP NORTH AMERICA, INC., as Documentation Agent (the
“Documentation Agent”).


          WHEREAS, certain of
the Lenders and other financial institutions have made available to Borrower a
revolving credit facility in the amount of $75,000,000, including a $25,000,000
letter of credit subfacility and a $20,000,000 swingline subfacility, on the
terms and conditions contained in that certain Credit Agreement dated as of July
8, 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 thereto;
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 $200,000,000, which will include a $50,000,000 letter of
credit subfacility and a $25,000,000 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:


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



          “Accommodation
Subsidiary” has the meaning given that term in
Section 4.1.(d).


          “Additional
Costs” has the meaning given that term in Section 5.1.


          “Adjusted
EBITDA” means, for any given period, (a) the EBITDA of the Parent
and its Subsidiaries determined on a consolidated basis for such period
minus (b) FF&E Reserves for such period.










          “Adjusted
LIBOR” 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 applicable 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 LIBOR on the date on which
such change in such maximum rate becomes effective.


          “Adjusted
Total Asset Value” means Total Asset Value determined exclusive of
assets that are owned by Excluded Subsidiaries, Foreign Subsidiaries and
Unconsolidated Affiliates.  



          “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 any Person (other than the Agent or any Lender):  (a) directly
or indirectly controlling, controlled by, or under common control with, the
Borrower; (b) directly or indirectly owning or holding ten percent (10.0%)
or more of any Equity Interest in the Borrower; or (c) ten percent (10.0%)
or more of whose voting stock or other Equity Interest is directly or indirectly
owned or held by the Borrower.  For purposes of this definition,
“control” (including with correlative meanings, the terms
“controlling”, “controlled by” and “under common
control with”) means the possession directly or indirectly of the power to
direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting securities or by contract or
otherwise.  The Affiliates of a Person shall include any officer or
director of such Person.  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.


          “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 rate set forth below corresponding to the
ratio of Total Indebtedness to Total Asset Value as determined in accordance
with Section 10.1. in effect at such time:


- 2 -









	
  
Level
  	
   
 	
  
Leverage   Ratio
  	
   
 	
  
Applicable   Margin for
   LIBOR Loans
  	
   
 	
  
Applicable   Margin for
   Base Rate Loans
  
	
  


  	
   
 	
  


  	
   
 	
  


  	
   
 	
  


  
	
  1
  	
  
 
  	
  
Less than or equal to 0.50   to 1.00
  	
  
 
  	
  
0.95%
  	
  
 
  	
  
0.0%
  
	
  
2
  	
  
 
  	
  
Greater than 0.50 to 1.00   but less than or equal to 0.55 to 1.00
  	
  
 
  	
  
1.25%
  	
  
 
  	
  
0.25%
  
	
  
3
  	
  
 
  	
  
Greater than 0.55 to 1.00   but less than 0.60 to 1.00
  	
  
 
  	
  
1.45%
  	
  
 
  	
  
0.45%
  
	
  4
  	
  
 
  	
  
Greater than or equal to   0.60 to 1.00
  	
  
 
  	
  
1.55%
  	
  
 
  	
  
0.65%
  




The Applicable Margin shall be determined by the Agent from time to time, based
on the ratio of Total Indebtedness to Total Asset Value as set forth in the
Compliance Certificate most recently delivered by the Borrower pursuant to
Section 9.3.  Any adjustment to the Applicable Margin shall be
effective (i) in the case of a Compliance Certificate delivered in
connection with quarterly financial statements of the Borrower delivered
pursuant to Section 9.1., as of the date 45 days following the end of the
last day of the applicable fiscal period covered by such Compliance Certificate,
(ii) in the case of a Compliance Certificate delivered in connection with
annual financial statements of the Parent delivered pursuant to
Section 9.2., as of the date 120 days following the end of the last day of
the applicable fiscal period covered by such Compliance Certificate, and
(iii) in the case of any other Compliance Certificate, as of the date 5
Business Days following the Agent’s request for such Compliance
Certificate.  Notwithstanding the foregoing, for the period from the
Effective Date through but excluding the date on which the Agent first
determines the Applicable Margin as set forth above, the Applicable Margin shall
be determined based on Level 1.  Thereafter, the Applicable Margin shall be
adjusted from time to time as set forth above.  If the Borrower shall fail
to deliver a compliance certificate within the time period required under
Section 9.3., the Applicable Margin shall be determined based on
Level 4 until the Borrower delivers the required Compliance Certificate, in
which case the Applicable Margin shall be determined as provided above effective
as of the date of delivery of such Compliance Certificate.


          “Approved
Fund” means any Person (other than a natural Person) (a) that is
(or will be) engaged in making, purchasing, holding or otherwise investing in
commercial loans and similar extensions of credit in the ordinary course of its
business and (b) that is administered or managed by a Lender, an affiliate
of a Lender or an entity or an affiliate of an entity that administers or
manages a Lender.


          “Approved
Manager” means Marriott International, Inc., Hilton Hotels Corporation,
Starwood Hotels & Resorts Worldwide, Noble Investment Group, RockResorts
International, Hyatt Corporation, Interstate Hotels & Resorts, Kimpton Group
and their respective affiliates.



          “Arranger”
means Wachovia Capital Markets, LLC.



          “Assignee”
has the meaning given that term in Section 13.5.(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.


- 3 -










          “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.



          “Borrower”
has the meaning set forth in the introductory paragraph hereof.


          “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.



          “Capitalization
Rate” means 9.00% for assets categorized Upscale or below, 8.00% for
assets categorized Upper Upscale and 7.50% for assets categorized Luxury or
Resort.  Such categorization shall be as determined by Smith Travel
Research or as otherwise requested by the Borrower and consented to in writing
by the Requisite Lenders.  Attached hereto as Schedule 1.1.(A) is the
categorization and Capitalization Rates for Properties owned directly or
indirectly by the Borrower as of the date hereof.



          “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 as would be required to be reflected on a balance sheet of the
applicable Person prepared in accordance with GAAP as of the applicable
date.


          “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
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 and at least
85% of whose assets consist of securities and other obligations of the type
described in clauses (a) through (d) above.


- 4 -










          “Collateral
Account” means a special deposit account established by the Agent
pursuant to Section 11.5. and under its sole dominion and control.



          “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 2.3.(a)
and 2.3.(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 2.2.(e), in each case, in an amount up to, but not exceeding, the amount
set forth for such Lender on its signature page hereto as such Lender’s
“Commitment Amount” or as set forth in the applicable Assignment and
Acceptance Agreement, as the same may be reduced from time to time pursuant to
Section 2.11. or as appropriate to reflect any assignments to or by such
Lender effected in accordance with Section 13.5.


          “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; 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 9.3.



          “Continue”,
“Continuation” and “Continued” each refers to
the continuation of a LIBOR Loan from one Interest Period to another Interest
Period pursuant to Section 2.8.



          “Convert”,
“Conversion” and “Converted” each refers to
the conversion of a Revolving Loan of one Type into a Revolving Loan of another
Type pursuant to Section 2.9.


          “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.



          “Default”
means any of the events specified in Section 11.1., 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 given that term in
Section 3.11.


- 5 -











          “Derivatives
Contract” means any and all rate swap transactions, basis swaps, credit
derivative transactions, forward rate transactions, commodity swaps, commodity
options, forward commodity contracts, equity or equity index swaps or options,
bond or bond price or bond index swaps or options or forward bond or forward
bond price or forward bond index transactions, interest rate options, forward
foreign exchange transactions, cap transactions, floor transactions, collar
transactions, currency swap transactions, cross-currency rate swap transactions,
currency options, spot contracts, or any other similar transactions or any
combination of any of the foregoing (including any options to enter into any of
the foregoing), whether or not any such transaction is governed by or subject to
any master agreement.  Not in limitation of the foregoing, the term
“Derivatives Contract” includes any and all transactions of any kind,
and the related confirmations, which are subject to the terms and conditions of,
or governed by, any form of master agreement published by the International
Swaps and Derivatives Association, Inc., any International Foreign Exchange
Master Agreement, or any other master agreement, including any such obligations
or liabilities under any such master agreement.



          “Derivatives
Termination Value” means, in respect of any one or more Derivatives
Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Derivatives Contracts, (a) for any date
on or after the date such Derivatives Contracts have been closed out and
termination value(s) determined in accordance therewith, such termination
value(s), and (b) for any date prior to the date referenced in clause (a)
the amount(s) determined as the mark-to-market value(s) for such Derivatives
Contracts, as determined based upon one or more mid-market or other readily
available quotations provided by any recognized dealer in such Derivatives
Contracts (which may include the Agent or any Lender).



          “Development
Property” means, as of any date of determination, any Property on which
the existing building or other improvements are undergoing renovation and
redevelopment that will either (a) disrupt the occupancy of at least 15% of
the rentable rooms of such Property or (b) temporarily reduce the Net
Operating Income attributable to such Property by more than 15% as compared to
the immediately preceding comparable prior period.  A Property shall cease
to be a Development Property once all improvements related to the
renovation or redevelopment of such Property have been substantially
completed.



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


          “Domestic
Subsidiary” means any Subsidiary that is incorporated or organized
under the laws of any state of the United States or the District of
Columbia.



          “EBITDA”
means, with respect to a Person for any period (without duplication): 
(a) net income (loss) of such Person for such period determined on a
consolidated basis (before minority interests), exclusive of the following (but
only to the extent included in determination of such net income (loss)): 
(i) depreciation and amortization expense; (ii) Interest Expense;
(iii) income tax expense; (iv) extraordinary or non-recurring gains
and losses; and (v) other non-cash charges (other than non-cash charges that
constitute an accrual of a reserve for future cash payments)
plus (b) such Person’s pro rata share of EBITDA of its
Unconsolidated Affiliates.  EBITDA shall be adjusted to remove any impact
from (x) non-cash amortization of stock grants to members of the Parent’s
management, (y) straight line rent leveling adjustments required under GAAP and
(z) amortization of intangibles pursuant to Statement of Financial Accounting
Standards number 141.


- 6 -










          “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 6.1. shall have been fulfilled (subject to the effect of
Section 6.3.) or waived in writing by the Requisite Lenders.


          “Eligible
Assignee” means any Person who is:  (i) currently a Lender or
an affiliate of a Lender; (ii) an Approved Fund; (iii) 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; (iv) 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 (v) 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.  Notwithstanding
the foregoing, during any period in which an Event of Default exists under
subsections (a), (f) or (g) of Section 11.1., the term “Eligible
Assignee” shall mean any Person that is not an individual.


          “Eligible
Unencumbered Borrowing Base Property” means a Property which satisfies
all of the following requirements:  (a) such Property (i) is a
Development Property or (ii) is a full service, select service or extended
stay lodging Property; (b) except in the case of a Development Property,
such Property is currently operating and open for business to the public; (c)
such Property is branded by a nationally recognized hotel company; (d) such
Property is located in a State of the United States of America, in the District
of Columbia or in any territories of the United States of America; (e) the
Property is owned in fee simple, or, with the consent of the Agent, leased under
a Ground Lease entirely by, the Borrower, a Subsidiary or an Unconsolidated
Affiliate; (f) neither such Property, nor any interest of the Borrower or
any Subsidiary therein, is subject to any Lien (other than Permitted Liens (but
not Liens of the types described in clauses (f), (g) and (h) of the definition
of Permitted Liens)) or a Negative Pledge; (g) if such Property is owned or
leased by a Subsidiary or an Unconsolidated Affiliate (i) none of the
Borrower’s direct or indirect ownership interest in such Subsidiary or
Unconsolidated Affiliate is subject to any Lien (other than Permitted Liens (but
not Liens of the types described in clauses (f), (g) and (h) of the definition
of Permitted Liens)) or to a 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) to sell, transfer or otherwise dispose of such Property and (y) to
create a Lien on such Property as security for Indebtedness of the Borrower or
such Subsidiary, as applicable; (h) such Property is either managed by
(i) the Borrower or any of its Subsidiaries, (ii) an Approved Manager
or (iii) a nationally recognized third-party property management company or
any of its affiliates approved by the Agent and Requisite Lenders; and
(i) such Property is free of all structural defects or title defects,
environmental conditions or other adverse matters except for defects,
deficiencies, conditions or other matters individually or collectively which are
not material to the profitable operation of such Property.


- 7 -











          “Environmental
Laws” means any Applicable Law relating to environmental protection or
the manufacture, storage, remediation, 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 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), 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.


          “Equity
Issuance” means any issuance by a Person of any Equity Interest in such
Person and shall in any event include the issuance of any Equity Interest upon
the conversion or exchange of any security constituting Indebtedness that is
convertible or exchangeable, or is being converted or exchanged, for Equity
Interests.



          “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 11.1.,
provided that any requirement for notice or lapse of time or any other condition
has been satisfied.


          “Excluded
Subsidiary” means any Subsidiary as to which both of the
following  apply (a) such Subsidiary holds title to, or beneficially
owns, assets which are or are intended to become collateral for any Secured
Indebtedness of such Subsidiary, or is a beneficial owner of a Subsidiary
holding title to or beneficially owning such assets (but having no material
assets other than such beneficial ownership interests); and (b) which (i)
is, or is expected to be, prohibited from Guarantying the Indebtedness of any
other Person pursuant to any document, instrument or agreement evidencing such
Secured Indebtedness or (ii) is prohibited from Guarantying the
Indebtedness of any other Person pursuant a provision of such Subsidiary’s
organizational documents which provision was included in such Subsidiary’s
organizational documents as a condition to the extension of such Secured
Indebtedness.


- 8 -










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


          “Fair Market
Value” means, with respect to (a) a security listed on a national
securities exchange or the NASDAQ National Market, the price of such security as
reported on such exchange by any widely recognized reporting method customarily
relied upon by financial institutions and (b) with respect to any other
property, the price which could be negotiated in an arm’s-length free
market transaction, for cash, between a willing seller and a willing buyer,
neither of which is under pressure or compulsion to complete the
transaction.


          “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.


          “FF&E
Reserves” means, for any period and with respect to a Property, an
amount equal to 4.0% of total gross revenues for such Property for such
period.  If the term FF&E Reserves is used without reference to a
specific Property, then the amount shall be determined on an aggregate basis
with respect to all Properties of the Parent and its Subsidiaries and a
proportionate share of all Properties of all Unconsolidated
Affiliates.


          “Fixed
Charges” means, for any period, the sum of (a) Interest Expense of
the Parent and its Subsidiaries determined on a consolidated basis for such
period, (b) all regularly scheduled principal payments made with respect to
Indebtedness of the Parent and its Subsidiaries during such period, other than
any balloon, bullet or similar principal payment which repays such Indebtedness
in full, and (c) all Preferred Dividends paid during such period on
Preferred Equity Interests not owned by the Parent or any of its
Subsidiaries.  The Parent’s pro rata share of the Fixed Charges of
Unconsolidated Affiliates of the Parent shall be included in determinations of
Fixed Charges.


          “Floating
Rate Indebtedness” means all Indebtedness of a Person which bears
interest at a variable rate during the scheduled life of such Indebtedness and
for which such Person has not obtained interest rate swap agreements, interest
rate “cap” or “collar” agreements or other similar
Derivatives Contracts which effectively cause such variable rates to be
equivalent to fixed rates or subject to maximum interest rates which, in each
case, are reasonably acceptable to the Agent.


- 9 -










          “Foreign
Subsidiary” means a Subsidiary that is not a Domestic
Subsidiary.


          “Funds From
Operations” means, with respect to a Person and for a given period,
(a) net income (loss) of such Person determined on a consolidated basis for
such period minus (or plus) (b) gains (or losses) from debt
restructuring and sales of property during such period plus
(c) depreciation with respect to such Person’s real estate assets and
amortization of such Person for such period, all after adjustment for
unconsolidated partnerships and joint ventures.  Adjustments for
Unconsolidated Affiliates will be calculated to reflect funds from operations on
the same basis.



          “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 significant segment of the accounting profession, which are
applicable to the circumstances as of the date of determination.
 

          “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, commission, board, department or other 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.


          “Ground
Lease” means a ground lease containing the following terms and
conditions:  (a) a remaining term (exclusive of any unexercised
extension options) of 25 years or more from the Agreement Date; (b) the
right of the lessee to mortgage and encumber its interest in the leased property
without the consent of the lessor, or, if consent is required, such consent has
been obtained; (c) the obligation of the lessor to give the holder of any
mortgage Lien on such leased property written notice of any defaults on the part
of the lessee and agreement of such lessor that such lease will not be
terminated until such holder has had a reasonable opportunity to cure or
complete foreclosures, and fails to do so; (d) reasonable transferability
of the lessee’s interest under such lease, including ability to sublease;
and (e) such other rights customarily required by mortgagees making a loan
secured by the interest of the holder of the leasehold estate demised pursuant
to a ground lease.



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


- 10 -











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


          “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.


          “Implied
Debt Service” means, for any period, an amount equal to the annual
principal and interest payment sufficient to amortize in full during a 30-year
period the aggregate principal balance of Loans and the amount of all Letter of
Credit Liabilities outstanding during such period calculated using an interest
rate equal to the greater of (i) the yield on a 10 year United States
Treasury Note at such time as determined by the Agent plus 1.50% or
(ii) 6.50%.


- 11 -











          “Indebtedness”
means, with respect to a Person, at the time of computation thereof, all of the
following (without duplication):  (a) all obligations of such Person
in respect of money borrowed (other than trade debt incurred in the ordinary
course of business which is not more than 180 days past due); (b) all
obligations of such Person, whether or not for money borrowed
(i) represented by notes payable, or drafts accepted, in each case
representing extensions of credit, (ii) evidenced by bonds, debentures,
notes or similar instruments, or (iii) constituting purchase money
indebtedness, conditional sales contracts, title retention debt instruments or
other similar instruments, upon which interest charges are customarily paid or
that are issued or assumed as full or partial payment for property or services
rendered; (c) Capitalized Lease Obligations of such Person; (d) all
reimbursement obligations of such Person under any letters of credit or
acceptances (whether or not the same have been presented for payment);
(e) all Off-Balance Sheet Obligations of such Person; (f) all
obligations of such Person to purchase, redeem, retire, defease or otherwise
make any payment in respect of any Mandatorily Redeemable Stock issued by such
Person or any other Person, valued at the greater of its voluntary or
involuntary liquidation preference plus accrued and unpaid dividends;
(g) all obligations of such Person in respect of any purchase obligation,
repurchase obligation, takeout commitment or forward equity commitment, in each
case evidenced by a binding agreement (excluding any such obligation to the
extent the obligation can be satisfied by the issuance of Equity Interests
(other than Mandatorily Redeemable Stock)); (h) net obligations under any
Derivatives Contract not entered into as a hedge against existing Indebtedness,
in an amount equal to the Derivatives Termination Value thereof; (i) all
Indebtedness of other Persons which such Person has Guaranteed or is otherwise
recourse to such Person (except for guaranties of customary exceptions for
fraud, misapplication of funds, environmental indemnities and other similar
exceptions to recourse liability (but not exceptions relating to bankruptcy,
insolvency, receivership or other similar events)); (j) all Indebtedness of
another Person secured by (or for which the holder of such Indebtedness has an
existing right, contingent or otherwise, to be secured by) any Lien on property
or assets owned by such Person, even though such Person has not assumed or
become liable for the payment of such Indebtedness or other payment obligation;
and (k) such Person’s pro rata share of the Indebtedness of any
Unconsolidated Affiliate of such Person.  Indebtedness of any Person shall
include Indebtedness 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
Indebtedness, or portion thereof, is recourse (other than in respect of
exceptions referred to in the definition of Nonrecourse Indebtedness) to such
Person, in which case the greater of such Person’s pro rata portion of such
Indebtedness or the amount of such recourse portion of the Indebtedness, shall
be included as Indebtedness of such Person).  All Loans and Letter of
Credit Liabilities shall constitute Indebtedness of the Borrower.



          “Intellectual
Property” has the meaning given that term in
Section 7.1.(t).



          “Interest
Expense” means, for any period, without duplication, (a) total
interest expense of the Parent and its Subsidiaries, including capitalized
interest not funded under a construction loan interest reserve account,
determined on a consolidated basis for such period, plus (b) the
Parent’s pro rata share of Interest Expense of Unconsolidated Affiliates
for such period.  Interest Expense shall exclude any amortization of
deferred financing fees.


          “Interest
Period” means with respect to any LIBOR Loan, each period commencing on
the date such LIBOR Loan is made or the last day of the next preceding Interest
Period for such Loan and ending 1, 2, 3 or 6 months, or if available from all of
the Lenders, 9 or 12 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 that commences on the last Business Day of
a calendar month shall end on the last Business Day of the appropriate
subsequent calendar month.  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 immediately following Business Day (or, if such immediately
following Business Day falls in the next calendar month, on the immediately
preceding Business Day).


- 12 -










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



          “Investment”
means, 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:  (a) the purchase or other acquisition of any Equity
Interest in another Person, (b) a loan, advance or extension of credit to,
capital contribution to, Guaranty of Indebtedness of, or purchase or other
acquisition of any Indebtedness of, another Person, including any partnership or
joint venture interest in such other Person, or (c) 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.  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.


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



          “Lender”
means each financial institution from time to time party hereto as a
“Lender” and as the context requires, includes the Swingline
Lender.


          “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 of which such Lender may notify the Agent in
writing.


          “Letter of
Credit” has the meaning given that term in
Section 2.3.(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 2.3.(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.


- 13 -











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



          “LIBOR”
means, for any LIBOR Loan for any Interest Period therefor, the rate per annum
(rounded upwards, if necessary, to the nearest 1/100 of 1%) appearing on
Telerate Page 3750 (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, the
term “LIBOR” shall mean, for any LIBOR Loan for any Interest Period
therefor, the rate per annum (rounded upwards, if necessary, to the nearest
1/100 of 1%) appearing on the Reuters Screen LIBO 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; provided, however, if more than one rate is
specified on the Reuters Screen LIBO Page, the applicable rate shall be the
arithmetic mean of all such rates. If for any reason none of the foregoing rates
is 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 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 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 Telerate page
3750 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.



          “Lien”
as applied to the property of any Person means:  (a) any security
interest, encumbrance, mortgage, deed to secure debt, deed of trust, assignment
of leases and rents, 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, rents or profits therefrom; (b) any
arrangement, express or implied, under which any property of such Person is
transferred, sequestered or otherwise identified for the purpose of subjecting
the same to the payment of Indebtedness 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 any precautionary filing not
otherwise constituting or giving rise to a Lien, including 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 agreement by such Person to grant, give
or otherwise convey any of the foregoing.


- 14 -











          “Loan”
means a Revolving 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 the Borrower, the Parent and each other Guarantor. 
Schedule 1.1.(B) sets forth the Loan Parties in addition to the Borrower
and the Parent 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 to the extent redeemable
in exchange for common stock or other equivalent common Equity Interests),
(b) is convertible into or exchangeable or exercisable for Indebtedness 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
Securities” means (a) bank deposits and certificates of deposit from a
bank rated Baa1 or BBB+ or better by a Rating Agency; (b) government
obligations; and (c) commercial paper rated A1 or P1 by a Rating Agency. 



          “Material
Adverse Effect” means a materially adverse effect on (a) the
business, assets, liabilities, financial condition or results of operations of
the Parent and its Subsidiaries, or the Borrower and its Subsidiaries, in each
case, 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 material provisions of the
Loan Documents, or (d) the material rights and remedies of the Lenders and
the Agent under any of the Loan Documents.


          “Material
Contract” means any contract or other arrangement (other than Loan
Documents), whether written or oral, to which the Parent, the Borrower, or any
other Subsidiary 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
Subsidiary” means any Subsidiary (a) that owns in fee simple, or
leases pursuant to a ground lease, an Unencumbered Borrowing Base Property or
(b) to which more than 10% of Total Asset Value is attributable on an
individual basis.


- 15 -











          “Moody’s”
means Moody’s Investors Service, Inc.



          “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 Indebtedness of
such Person or another Person.


          “Mortgage
Receivable” means a promissory note secured by a Mortgage of which the
Parent, the Borrower or another Subsidiary is the holder and retains the rights
of collection of all payments thereunder.



          “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.


          “Negative
Pledge” means, with respect to a given asset, any provision of a
document, instrument or agreement (other than any Loan Document) which prohibits
or purports to prohibit the creation or assumption of any Lien on such asset as
security for Indebtedness of the Person owning such asset or any other Person;
provided, however, that an agreement that conditions a Person’s ability to
encumber its assets upon the maintenance of one or more specified ratios that
limit such Person’s ability to encumber its assets but that do not
generally prohibit the encumbrance of its assets, or the encumbrance of specific
assets, shall not constitute a Negative Pledge.


          “Net
Operating Income” or “NOI” means, for any Property and
for a given period, the sum of the following (without duplication and determined
on a consistent basis with prior periods):  (a) gross revenues
received in the ordinary course from such Property minus (b) all expenses
paid (excluding interest but including an appropriate accrual for property taxes
and insurance) related to the ownership, operation or maintenance of such
Property, including but not limited to property taxes, assessments and the like,
insurance, utilities, payroll costs, maintenance, repair and landscaping
expenses, marketing expenses, and general and administrative expenses (including
an appropriate allocation for legal, accounting, advertising, marketing and
other expenses incurred in connection with such Property, but specifically
excluding general overhead expenses of the Borrower or any Subsidiary and any
property management fees) minus (c) the FF&E Reserves for such Property
as of the end of such period minus (d)  the greater of (i) the actual
property management fee paid during such period and (ii) an imputed
management fee in the amount of three percent (3.0%) of the gross revenues for
such Property for such period. 


          “Net
Tangible Proceeds” means with respect to any Equity Issuance by a
Person, the aggregate amount of all cash and the Fair Market Value of all other
property (other than (a) securities of such Person being converted or
exchanged in connection with such Equity Issuance and (b) assets separately
classified as intangible assets under GAAP) received by such Person in respect
of such Equity Issuance net of investment banking fees, legal fees,
accountants’ fees, underwriting discounts and commissions and other
customary fees and expenses actually incurred by such Person in connection with
such Equity Issuance.


- 16 -











          “Nonrecourse
Indebtedness” means, with respect to a Person, (a) Indebtedness 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 recourse 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
Indebtedness or (b) if such Person is a Single Asset Entity, any Indebtedness
for borrowed money of such Person.



          “Note”
means a Revolving 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 2.8. 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 2.9. 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 2.2. evidencing the
Borrower’s request for a borrowing of Swingline Loans.



          “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.
 

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



          “Off-Balance
Sheet Obligations” means liabilities and obligations of the Parent, any
Subsidiary or any other Person in respect of “off-balance sheet
arrangements” (as defined in Item 303(a)(4)(ii) of Regulation S-K
promulgated under the Securities Act) which the Parent would be required to
disclose in the “Management’s Discussion and Analysis of Financial
Condition and Results of Operations” section of the Parent’s report on
Form 10-Q or Form 10-K (or their equivalents) which the Parent is required to
file with the Securities and Exchange Commission (or any Governmental Authority
substituted therefor).


- 17 -











          “Parent”
has the meaning given such term in the introductory paragraph hereof.



          “Participant”
has the meaning given that term in Section 13.5.(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
pursuant to any Environmental Laws) 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 8.6.; (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 intended use thereof in
the business of such Person; (d) the rights of tenants under leases or
subleases not interfering with the ordinary conduct of business of such Person;
(e) Liens in favor of the Agent for the benefit of the Lenders;
(f) Liens in favor of the Borrower or a Guarantor securing obligations
owing by a Subsidiary to the Borrower or a Guarantor; (g) Liens in
existence as of the Agreement Date and set forth in the Part II of
Schedule 7.1.(f); (h) Liens arising out of judgments or awards in
respect of the Parent or any of its Subsidiaries not constituting an Event of
Default under Section 11.1.(i); (i) any interest or title of a lessor
under any lease of equipment (not constituting a fixture) entered into by the
Borrower or any Subsidiary in the ordinary course of its business and covering
only the assets so leased; and (j) Liens arising in the ordinary course of
business by virtue of any contractual, statutory or common law provision
relating to banker’s liens, rights of set-off or similar rights and
remedies covering deposit or securities accounts (including funds or other
assets credited thereto).  



          “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 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.


- 18 -











          “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 mandatory prepayment or otherwise), a rate per annum equal to
the Base Rate as in effect from time to time plus the Applicable Margin
for Base Rate Loans plus two percent (2.0%).


          “Preferred
Dividends” means, for any period and without duplication, all
Restricted Payments paid during such period on Preferred Equity Interests issued
by the Parent or a Subsidiary.  Preferred Dividends shall not include
dividends or distributions (a) paid or payable solely in Equity Interests
(other than Mandatorily Redeemable Stock) payable to holders of such class of
Equity Interests, (b) paid or payable to the Parent or a Subsidiary, or
(c) constituting or resulting in the redemption of Preferred Equity
Interests, other than scheduled redemptions not constituting balloon, bullet or
similar redemptions in full.


          “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 then 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 office of the Agent located at One Wachovia Center,
Charlotte, North Carolina, or such other office of the Agent as the Agent may
designate from time to time.



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


          “Qualified
REIT Subsidiary” shall have the meaning given to such term in the
Internal Revenue Code.



          “Register”
has the meaning given that term in Section 13.5.(e).


          “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.


- 19 -











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


          “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).  



          “Responsible
Officer” means with respect to the Parent, the Borrower or any
Subsidiary, the chief executive officer, the chief financial officer or any
other senior executive officer of the Parent, the Borrower or such
Subsidiary.


          “Restricted
Payment” means:  (a) any dividend or other distribution,
direct or indirect, on account of any Equity Interest of the Parent, the
Borrower or any Subsidiary now or hereafter outstanding, except a dividend
payable solely in Equity Interests; (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 the Parent,
the Borrower or any Subsidiary 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 the Parent, the
Borrower or any Subsidiary now or hereafter outstanding.


          “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 2.10.(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
Indebtedness” means, with respect to any Person, (a) all
Indebtedness of such Person that is secured in any manner by any Lien on any
Property plus (b) such Person’s pro rata share of the Secured
Indebtedness of any of such Person’s Unconsolidated Affiliates.


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



          “Significant
Subsidiary” means any Subsidiary to which more than $10,000,000 of the
unallocated gross book value (exclusive of depreciation and amortization) of all
real estate assets of the Parent and its Subsidiaries is
attributable.


- 20 -










          “Single
Asset Entity” means a Person (other than an individual) that (a) only
owns a single Property; (b) is engaged only in the business of owning,
developing and/or leasing such Property; and (c) receives substantially all of
its gross revenues from such Property.  In addition, if the assets of a
Person consist solely of (i) Equity Interests in one other Single Asset Entity
and (ii) cash and other assets of nominal value incidental to such Person’s
ownership of the other Single Asset Entity, such Person shall also be deemed to
be a Single Asset Entity for purposes of this Agreement.  



          “Solvent”
means, when used with respect to any Person, that (a) the fair value and
the fair salable value of its assets (excluding any Indebtedness 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.


          “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 Equity Interests having by the terms thereof ordinary
voting power to elect a majority of the board of directors or other individuals
performing similar functions of such corporation, partnership or other entity
(without regard to the occurrence of any contingency) is at the time 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 are consolidated with those of such Person
pursuant to GAAP.


          “Swingline
Commitment” means the Swingline Lender’s obligation to make
Swingline Loans pursuant to Section 2.2. in an amount up to, but not
exceeding, $25,000,000, as such amount may be reduced from time to time in
accordance with the terms hereof.


          “Swingline
Lender” means Wachovia Bank, National Association.


          “Swingline
Loan” means a loan made by the Swingline Lender to the Borrower
pursuant to Section 2.2.(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.


- 21 -










          “Tangible
Net Worth” means, as of any given time: (a) the unallocated gross
book value (exclusive of depreciation and amortization) of all real estate
assets of the Parent and its Subsidiaries that constitute Properties at such
time; plus (b) the book value of other assets (excluding any real
estate assets but including Investments in Unconsolidated Affiliates) of the
Parent and its Subsidiaries; less (c) all amounts appearing on the
assets side of a consolidated balance sheet of the Parent for assets separately
classified as intangible assets under GAAP (except for allocations of property
purchase prices pursuant to Statement of Financial Accounting Standards
No. 141 and the like); less (d) all Total Indebtedness of the
Parent and its Subsidiaries (excluding the pro rata share of Indebtedness of any
Unconsolidated Affiliate to the extent included in Total Indebtedness)
determined on a consolidated basis; less (e) all other liabilities
of the Parent and its Subsidiaries determined on a consolidated basis (except
liabilities resulting from allocations of property purchase prices pursuant to
Statement of Financial Accounting Standards No. 141 and the
like).


          “Taxable
REIT Subsidiary” means any corporation (other than a REIT) in which the
Parent directly or indirectly owns stock and the Parent and such corporation
have jointly elected that such corporation be treated as a taxable REIT
subsidiary of the Parent under and pursuant to Section 856 of the Internal
Revenue Code.



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



          “Termination
Date” means February 28, 2011, or such later date to which the
Termination Date may be extended pursuant to Section 2.12. 


          “Titled
Agents” means each Sole Lead Arranger, the Book Manager, the
Syndication Agent and the Documentation Agent.


          “Total Asset
Value” means the sum of all of the following of the Borrower and its
Subsidiaries on a consolidated basis determined in accordance with GAAP applied
on a consistent basis:  (a) cash, Cash Equivalents and Marketable
Securities, plus (b) with respect to each Property owned by the Borrower or
any Subsidiary (other than Unimproved Land) for eighteen (18) months or greater,
(i) the Adjusted EBITDA of such Property for the period of four consecutive
fiscal quarters most recently ending, divided by (ii) the Capitalization
Rate, plus (c) the purchase price paid for any Property owned by the
Borrower or any Subsidiary for less than eighteen (18) months (other than
Unimproved Land)(less amounts paid as a purchase price adjustment, held in
escrow, retained as a contingency reserve, or other similar arrangements and
prior to allocations of property purchase prices pursuant to Statement of
Financial Accounting Standards No. 141 and the like), plus (d) the book value of
Unimproved Land, Mortgage Receivables and other promissory notes, plus (e) the
Borrower’s pro rata share of the preceding items for its Unconsolidated
Affiliates (excluding assets of the type described in the immediately preceding
clause (a)).  Notwithstanding the foregoing, for purposes of determining
Total Asset Value, the amount, if any, by which the value of cash, Cash
Equivalents and Marketable Securities included under the immediately preceding
clause (a) would account for more than 10% of Total Asset Value shall be
excluded.  Borrower shall have the one time right to have a Property owned
for less than eighteen (18) months included in Total Asset Value under (b)
above, as though owned for a period of equal to or greater than eighteen (18)
months at its discretion.  The percentage of Total Asset Value attributable
to a given Subsidiary shall be equal to the ratio expressed as a percentage of
(x) an amount equal to Total Asset Value calculated solely with respect to
assets owned directly by such Subsidiary to (y) Total Asset Value. 


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          “Total
Indebtedness” means all Indebtedness of the Parent, the Borrower and all
other Subsidiaries of the Parent determined on a consolidated basis.



          “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
Borrowing Base Property” means a Property which is to be included in
calculations of the Unencumbered Borrowing Base Value pursuant to
Section 4.1.  A Property shall cease to be an Unencumbered Borrowing
Base Property if at any time such Property shall cease to be an Eligible
Unencumbered Borrowing Base Property unless otherwise agreed by the Requisite
Lenders.  Not more than two Properties that have not been continuously
operating for a period of at least twelve consecutive months may be Unencumbered
Borrowing Base Properties without the consent of the Requisite
Lenders.



          “Unencumbered
Borrowing Base Property NOI” means, for any period, NOI from all
Unencumbered Borrowing Base Properties for such period. For purposes of this
definition, to the extent the NOI attributable to (a) any one Unencumbered
Borrowing Base Property would exceed 40.0% of Unencumbered Borrowing Base
Property NOI, such excess shall be excluded and (b) Unencumbered Borrowing
Base Properties located in the same metropolitan statistical area would exceed
40.0% of Unencumbered Borrowing Base Property NOI, such excess shall be
excluded.



          “Unencumbered
Borrowing Base Value” means the sum of all of the following of the
Borrower and its Subsidiaries on a consolidated basis determined in accordance
with GAAP applied on a consistent basis: (a) with respect to each
Unencumbered Borrowing Base Property owned by the Borrower or any Subsidiary for
18 months or greater, (i) the NOI of such Property for the period of four
consecutive fiscal quarters most recently ending, divided by (ii) the
Capitalization Rate, plus (b) the purchase price paid for any Unencumbered
Borrowing Base Property owned by the Borrower or any Subsidiary for less than 18
months (less amounts paid as a purchase price adjustment, held in escrow,
retained as a contingency reserve, or other similar arrangements and prior to
allocations of property purchase prices pursuant to Statement of Financial
Accounting Standards No. 141 and the like).  Notwithstanding the foregoing,
for purposes of determining Unencumbered Borrowing Base Value, the Borrower
shall have the one time right, exercisable in its discretion, to have an
Unencumbered Borrowing Base Property owned for less than 18 months included in
Unencumbered Borrowing Base Value under clause (a) above, as though owned
for a period of 18 or more months.  In addition, with respect to any
Property owned or leased by an Unconsolidated Affiliate, only the
Borrower’s pro rata share of the NOI of such Property shall be included
under clause (a) above or the Borrower’s pro rata share of the purchase
price of such Property shall be included under clause (b) above.  For
purposes of this definition, to the extent Unencumbered Borrowing Base Value
attributable to (x) Development Properties would exceed 20% of the
Unencumbered Borrowing Base Value, such excess shall be excluded and
(y) Properties that are not owned by Guarantors would exceed 20% of the
Unencumbered Borrowing Base Value, such excess shall be excluded. 



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          “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.


          “Unimproved
Land” means land on which no development (other than improvements that
are not material and are temporary in nature) has occurred and for which no
development is scheduled in the following 12 months.  Unimproved Land shall
not include any undeveloped parcels of a Property that has been developed unless
and until the Borrower intends to develop such parcel.


          “Unsecured
Indebtedness” means with respect to a Person as of any given date, (a)
the aggregate principal amount of (a) all Indebtedness of such Person
outstanding at such date that is not Secured Indebtedness plus (b) all
Nonrecourse Indebtedness which such Person has Guaranteed but only to the extent
of such Guaranty (excluding obligations in respect of Guaranties of customary
exceptions to nonrecourse liability).



          “Wachovia”
means Wachovia Bank, National Association.


          “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, such ratio or requirement shall continue to be
computed in accordance with GAAP prior to such change therein and 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
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.  A reference to a Person
shall include its successors and permitted assigns.  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 Parent or a Subsidiary of
such Subsidiary and a reference to an “Affiliate” means a reference to
an Affiliate of the Parent.  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.


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Section 1.3.  Financial Attributes of Non-Wholly Owned Subsidiaries.


          When determining
compliance by the Borrower or the Parent with any financial covenant contained
in any of the Loan Documents, only the pro rata share of the Borrower or the
Parent, as applicable, of the financial attributes of a Subsidiary that is not a
Wholly Owned Subsidiary shall be included.


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.


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          (c)          Disbursements
of Revolving Loan Proceeds.  No later than 1:00 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 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 VI. for
such borrowing, the Agent will make the proceeds of such borrowing available to
the Borrower no later than 2:00 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.  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
3:00 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 VI. 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.


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          (c)          Interest. 
Swingline Loans shall bear interest at a per annum rate equal to the LIBOR Index
Rate plus the Applicable Margin for LIBOR Loans.  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 2.4. 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 $500,000 and integral multiples of $100,000 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 10:00 a.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 on demand therefor by the Swingline Lender and in any event,
within 5 Business Days after the date such Swingline Loan was made; provided,
that the proceeds of a Swingline Loan shall not be used to repay any other
Swingline Loans.  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 for such purpose), 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.  No later than 2:00 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.  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 Section 11.1.(f) or 11.1.(g), upon notice from the
Agent or the Swingline Lender, 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 Agent 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 demand therefor by the Agent or the Swingline
Lender, 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 11.1.(f) or 11.1.(g)) or the
termination of any Lender’s Revolving 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 other circumstance, happening or
event whatsoever, whether or not similar to any of the foregoing.


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Section 2.3.  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. 



          (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 VI., the Agent
shall issue the requested Letter of Credit on the requested date of issuance for
the benefit of the stipulated beneficiary.  Upon the written request of 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.


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          (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.  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 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 2.3.(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 VI. 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.


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          (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 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
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 (as determined by a court
of competent jurisdiction in a final, non-appealable judgment), shall not create
against the Agent or any Lender any liability to the Borrower or any
Lender.  In this regard, 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 13.9., 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 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 determined by a court of
competent jurisdiction in a final, non-appealable judgment.  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.


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          (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
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 2.3.(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 2.3.(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 therefor;
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 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 11.1.(f) or 11.1.(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.


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          (k)          Information
to Lenders. The Agent shall periodically deliver to the Lenders information
setting forth the Stated Amount of all outstanding Letters of Credit.  In
addition, 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 2.3.(j).


Section 2.4.  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; and
 
	
  
 
  	
  
 
  
	
  
 
  	
  

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




Notwithstanding the foregoing, overdue principal, Reimbursement Obligations and
(to the extent permitted by Applicable Law) interest on the Loans and all other
overdue amounts payable hereunder or under any of the other Loan Documents shall
bear interest at a rate per annum equal to the Post-Default Rate until such
amount shall be paid in full.



          (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 day of
each calendar month, (ii) in the case of a LIBOR Loan, in arrears on the
last day of each 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.


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          (c)          Inaccurate
Financial Statements or Compliance Certificates.  If any financial
statement or Compliance Certificate delivered pursuant to Section 9.3. is
shown to be inaccurate (regardless of whether this Agreement or the Commitments
are in effect when such inaccuracy is discovered), and such inaccuracy, if
corrected, would have led to the application of a higher Applicable Margin for
any period (an “Applicable Period”) than the Applicable Margin applied
for such Applicable Period, then (i) the Borrower shall immediately deliver
to the Agent a correct Compliance Certificate for such Applicable Period,
(ii) the Applicable Margin shall be determined on the basis of such
corrected Compliance Certificate for such Applicable Period, and (iii) the
Borrower shall immediately pay to the Agent for the account of the Lenders the
accrued additional interest owing as a result of such increased Applicable
Margin for such Applicable Period, which payment shall be promptly applied by
the Agent in accordance with Section 3.2. This subsection shall not in any
way limit the rights of the Agent and Lenders (x) with respect to the last
sentence of the immediately preceding subsection (a) or (y) under
Article XI.


Section 2.5.  Number of Interest Periods.


          There may be no more
than 5 different Interest Periods for LIBOR Loans outstanding at the same
time.


Section 2.6.  Repayment of 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.


Section 2.7.  Prepayments.



          (a)          Optional. 
Subject to Section 5.4., the Borrower may prepay any Loan at any time
without premium or penalty.  The Borrower shall give the Agent at least one
Business Day’s prior written notice of the prepayment of any Revolving
Loan.



          (b)          Mandatory. 


	
  
 
  	
  

            (i)          Outstandings
In Excess of Commitments. If at any time the aggregate principal amount of
all outstanding Revolving Loans, together with the aggregate amount of all
Letter of Credit Liabilities 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
account of the Lenders the amount of such excess; and
 
	
   
  	
  
 
  
	
  
 
  	
  

            (ii)         Outstandings
in Excess of Minimum Implied Debt Service Ratio.  If at any time the
aggregate outstanding principal balance of Loans, together with the aggregate
amount of all Letter of Credit Liabilities, exceeds the amount which is
supported by the Minimum Implied Debt Service Ratio covenant in Section
10.1.(e), then the Borrower shall, within 5 days of the occurrence of such
excess, pay to the Agent for the account of the Lenders the amount of such
excess.
 




- 33 -











          (c)          Application
of Prepayments.  All payments under this Section 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 by reason of this Section prior to the end of the applicable Interest
Period therefor, the Borrower shall pay all amounts due under
Section 5.4.


Section 2.8.  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 2.9. or the Borrower’s failure to comply with any of the terms
of such Section.


Section 2.9.  Conversion.


          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; provided, however, a Base Rate Loan may not be Converted to a LIBOR Loan
if a Default or Event of Default shall exist.  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.


- 34 -










Section 2.10.  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 H (each a “Revolving Note”),
payable to the order of such Lender in a principal amount equal to the amount of
its Commitment as originally in effect and otherwise duly completed.



          (b)          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; provided, however, that the failure of a Lender to make any such record
shall not affect the obligations of the Borrower under any of the Loan
Documents.


          (c)          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 2.11.  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) 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, if the Borrower seeks to reduce the aggregate amount of the
Commitments below $100,000,000, then the Commitments shall all automatically and
permanently be reduced to zero.  The Agent will promptly transmit such
notice to each Lender.  The Commitments, once terminated or reduced may not
be increased or reinstated.


- 35 -










Section 2.12.  Extension of Termination Date.


          The Borrower shall
have the right, exercisable one time, to extend the Termination Date by one
year.  The Borrower may exercise such right only by executing and
delivering to the Agent at least 45 days but not more than 120 days prior to the
current Termination Date, a written request for such extension (an
“Extension Request”).  The Agent shall forward to each Lender a
copy of the Extension Request delivered to the Agent promptly upon receipt
thereof.  Subject to satisfaction of the following conditions, the
Termination Date shall be extended for one year:  (a) immediately
prior to such extension and immediately after giving effect thereto, (i) no
Default or Event of Default shall exist and (ii) 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 such extension 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
(b) the Borrower shall have paid the Fees payable under
Section 3.6.(c).


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, the Agent shall not be required to issue a Letter of
Credit and no reduction of the Commitments pursuant to Section 2.11. shall
take effect, if immediately after the making of such Loan, the issuance of such
Letter of Credit or such reduction in the Commitments, the aggregate principal
amount of all outstanding Loans, together with the aggregate amount of all
Letter of Credit Liabilities, would exceed the aggregate amount of the
Commitments at such time.


Section 2.15.  Increase of Commitments.


          With the prior
consent of the Agent, the Borrower shall have the right at any time and from
time to time from during the term of this Agreement to request up to 4 increases
in the aggregate amount of the Commitments (provided that after giving effect to
any increases in the Commitments pursuant to this Section, the aggregate amount
of the Commitments may not exceed $500,000,000) 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 (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 2.3.(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 5.4. 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 in all
material respects 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
shall execute such documents and agreements as the Agent may reasonably request
and (b) the Borrower shall make appropriate arrangements so that each new
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.


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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 11.4., the
Borrower may, 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.


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Section 3.2.  Pro Rata Treatment.


          Except to the extent
otherwise provided herein:  (a) each borrowing from the Lenders under
Section 2.1.(a), 2.2.(e) and 2.3.(e) shall be made from the Lenders, each
payment of the Fees under Section 3.6.(a), the first sentence of
Section 3.6.(b) and Section 3.6.(c) shall be made for the account of the
Lenders, and each termination or reduction of the amount of the Commitments
under Section 2.11. 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 5.5.) shall be made pro rata among the Lenders according to the
amounts of their respective Commitments (in the 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 2.3.,
shall be pro rata in accordance with their respective Commitments; and
(f) the Lenders’ participation in, and payment obligations in respect
of, Swingline Loans under Section 2.2., shall be pro rata in accordance
with their respective Commitments.  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 a participating interest in any such Swingline Loan pursuant to
Section 2.2.(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 11.4., 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 11.4., 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.


- 38 -










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.


Section 3.5.  Minimum Amounts.



          (a)          Borrowings
and Conversions.  Except as otherwise provided in Sections 2.2.(e)
and 2.3.(e), each borrowing of Base Rate Loans shall be in an aggregate minimum
amount of $500,000 and integral multiples of $100,000 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 $100,000 in excess of
that amount.



          (b)          Prepayments. 
Each voluntary prepayment of Revolving Loans shall be in an aggregate minimum
amount of $100,000 and integral multiples of $100,000 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 2.11. 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)          Unused
Fee. During the period from the Effective Date to but excluding the
Termination Date, the Borrower agrees to pay to the Agent for the account of the
Lenders an unused facility fee with respect to the average daily difference
between the (i) aggregate amount of the Commitments and (ii) the
aggregate principal amount of all outstanding Loans plus the aggregate amount of
all Letter of Credit Liabilities (the “Unused Amount”).  Such fee
shall be computed by multiplying the Unused Amount with respect to such quarter
by the corresponding per annum rate set forth below:


- 39 -









	
  
    Unused   Amount
  	
  
     
  	
  
    Unused   Fee
  
	
  


  	
  
     
  	
  


  
	
  
    <50% of the aggregate   amount of Commitments
  	
  
     
  	
  
    0.125%
  
	
  
    > 50% of the aggregate amount of Commitments
  	
  
     
  	
  
    0.20%
  



Such fee shall be payable in arrears on the last day of each March, June,
September or December of each calendar year.  Any such accrued and unpaid
fee shall also be payable on the Termination Date or any earlier date of
termination of the Commitments or reduction of the Commitments to
zero.



          (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.  The fees provided for in the immediately
preceding sentence shall be nonrefundable and payable in arrears on (i) the last
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, an issuance fee in respect of each Letter of Credit equal
to the greater of (i) $500 or (ii) 0.125% of the Stated Amount of such
Letter of Credit.  The fees provided for in the immediately preceding
sentence shall be nonrefundable and payable upon issuance (or in the case of an
increase in the Stated Amount of a Letter of Credit, on the effective date of
such increase but only with respect to the amount of such increase).  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 time to time in like circumstances with respect to the issuance
of each Letter of Credit, drawings, amendments and other transactions relating
thereto.



          (c)          Extension
Fee.  If the Borrower exercises its right to extend the Termination
Date in accordance with Section 2.12., the Borrower agrees to pay to the
Agent for the account of each Lender a fee equal to two-tenths of one percent
(0.20%) of the amount of such Lender’s Commitment (whether or not utilized)
at the time of such extension.  Such fee shall be due and payable in full
on the date the Agent receives the Extension Request pursuant to such
Section.



          (d)          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 365
or 366 days, as applicable, and the actual number of days elapsed; provided,
however, interest on LIBOR Rate Loans shall be computed on the basis of a year
of 360 days and the actual number of day elapsed.


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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 2.4.(a)(i) and (ii) and in Section
2.2.(c).  Notwithstanding the foregoing, the parties hereto further agree
and stipulate that all agency fees, syndication fees, unused 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 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.


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          (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 13.5.(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.  The Agent,
the Lenders and the Titled Agents shall have no 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
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 13.5.(d), shall pay to the Agent an assignment fee in the amount of
$7,000.  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.


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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 imposed on or measured by any
Lender’s assets, net income, receipts or branch profits, (iii) any
taxes (other than withholding taxes) with respect to the Agent or a Lender that
would not be imposed but for a connection between the Agent or such 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), 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 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.


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          (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 imposed under the Internal
Revenue Code.  Each such Lender or Participant shall, to the extent it may
lawfully do so, (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 the 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, to the extent it may lawfully do so, 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.


ARTICLE IV.  UNENCUMBERED BORROWING BASE PROPERTIES


Section 4.1.  Eligibility of Properties.



          (a)          Initial
Unencumbered Borrowing Base Properties.  As of the date hereof, the
parties agree that the Properties identified on Schedule 4.1. shall be
Unencumbered Borrowing Base Properties, and accordingly, shall be included in
calculations of the Unencumbered Borrowing Base Value initially having the
respective Unencumbered Borrowing Base Values set forth on such
Schedule.



          (b)          Additional
Unencumbered Borrowing Base Properties.  If, after the Agreement Date,
the Borrower desires that any additional Property become an Unencumbered
Borrowing Base Property and therefore included in calculations of the
Unencumbered Borrowing Base Value, the Borrower shall so notify the Agent in
writing.  Except as otherwise provided in the immediately following
subsection (c), no Property will become an Unencumbered Borrowing Base
Property unless it is an Eligible Unencumbered Borrowing Base Property, and
unless and until the Borrower delivers to the Agent the following, in form and
substance satisfactory to the Agent:


- 44 -









	
  
 
  	
  

          (i)          a
description of such Property, such description to include the age, location and
size of such Property;
 
	
   
  	
  
 
  
	
  
 
  	
  

          (ii)         an
operating statement with respect to such Property for each of the two prior
fiscal years and for the current fiscal year through the fiscal quarter most
recently ending and for the current fiscal quarter, which shall be audited (to
the extent available) or certified by a representative of the Borrower to the
best of such representative’s knowledge as being true and correct in all
material respects; provided, that with respect to any period such Property was
not owned by a Loan Party, such information shall only be required to be
delivered to the extent reasonably available to the Borrower;
 
	
  
 
  	
  
 
  
	
  
 
  	
  

          (iii)        a
pro forma operating statement or an operating budget for such Property with
respect to the current and immediately following fiscal years;
 
	
  
 
  	
  
 
  
	
  
 
  	
  

          (iv)        a
budget for capital expenditures for the immediately following 12-month period
showing funding sources acceptable to the Agent; and
 
	
   
  	
  
 
  
	
  
 
  	
  

          (v)         such
other information the Agent may reasonably request in order to evaluate such
Property.
 




A notification from the Borrower to the Agent that the Borrower desires that a
Property be included in calculations of the Unencumbered Borrowing Base Value
shall constitute a certification by the Borrower to the Agent and the Lenders
that such Property satisfies all of the requirements contained in the definition
of “Eligible Unencumbered Borrowing Base Property” unless such notice
states otherwise (in which case the provisions of the immediately following
subsection (c) shall apply).  Upon the Agent’s receipt of all of
the foregoing items with respect to an Eligible Unencumbered Borrowing Base
Property, such Property shall become an Unencumbered Borrowing Base Property,
and accordingly, shall be included in calculations of the Unencumbered Borrowing
Base Value.



          (c)          Nonconforming
Properties.  If a Property which the Borrower wants to have included in
the Unencumbered Borrowing Base Value does not satisfy the requirements of an
Eligible Unencumbered Borrowing Base Property, then the Agent, upon written
request of the Borrower shall request that the Lenders determine whether such
Property shall be included as an Unencumbered Borrowing Base Property.  In
connection therewith, the Borrower shall deliver the information required by the
immediately preceding subsection (b) to each of the Lenders.  If such
a request is made by the Agent to the Lenders, within 10 Business Days after the
date on which a Lender has received such request and all of the items referred
to in the immediately preceding subsection (b), such Lender shall notify
the Agent in writing whether or not such Lender accepts such Property as an
Unencumbered Borrowing Base Property.  If a Lender fails to give such
notice within such time period, such Lender shall be deemed to have approved
such Property as an Unencumbered Borrowing Base Property.  A Property shall
become an Unencumbered Borrowing Base Property under this subsection (c) only
upon the approval and/or deemed approval of the Requisite Lenders.


- 45 -











          (d)          Documents
with Respect to Subsidiary or Unconsolidated Affiliate.  Upon a
Property owned by a Subsidiary or an Unconsolidated Affiliate that is not a
Guarantor becoming an Unencumbered Borrowing Base Property, the Borrower shall
deliver to the Agent an Accession Agreement executed by such Subsidiary or
Unconsolidated Affiliate together with the items that would have been delivered
with respect to such Subsidiary or Unconsolidated Affiliate under
Sections 6.1.(a)(iv) through (viii) and (xii) as if such Subsidiary or
Unconsolidated Affiliate had been a Guarantor on the Effective Date (without
taking into account the effect of Section 6.3.).  If the improvements
on an Unencumbered Borrowing Base Property or the furniture, fixtures and
equipment utilized in the operation of such Unencumbered Borrowing Base Property
are owned or leased by a Subsidiary (the “Accommodation Subsidiary”)
other than the Subsidiary that owns or leases such Unencumbered Borrowing Base
Property, then the Borrower shall also deliver to the Agent an Accession
Agreement executed by such Accommodation Subsidiary.  Until such time as
the Agent shall have received the items referred to in the immediately preceding
two sentences with respect to such Subsidiary or Unconsolidated Affiliate and
any applicable Accommodation Subsidiary, the Unencumbered Borrowing Base Value
of any Unencumbered Borrowing Base Property owned by such Subsidiary or
Unconsolidated Affiliate shall be $0 and any NOI attributable to such Property
shall not be included in Unencumbered Borrowing Base Property NOI.  For the
avoidance of doubt, a Property shall not be included in determinations of
Unencumbered Borrowing Base Property NOI or Unencumbered Borrowing Base Value if
the Subsidiary or Unconsolidated Affiliate that owns or leases such is not a
Guarantor.


Section 4.2.  Reclassification of Properties.


          From time to time
the Borrower may request, upon not less than 10 Business Days prior written
notice to the Agent, that an Unencumbered Borrowing Base Property be no longer
classified as an Unencumbered Borrowing Base Property and therefore not included
in the calculations of the Unencumbered Borrowing Base Value, which
reclassification (a “Reclassification”) shall be effected by the Agent
if all the following conditions are satisfied as of the date of such
Reclassification:  



          (a)          no
Default or Event of Default exists or will exist immediately after giving effect
to such Reclassification and the reduction in the Unencumbered Borrowing Base
Value by reason of the release of such Property as of the date of such
Reclassification (any such request from the Borrower shall include a
representation regarding no Default or Event of Default to the effect set forth
in the preceding sentence); and
 

          (b)          the
Borrower shall have delivered a Compliance Certificate showing pro forma
compliance with the covenants set forth in Section 10.1. after giving
effect to such Reclassification.


Upon the Borrower’s request and at the Borrower’s sole cost and
expense, the Agent agrees to execute and deliver such instruments, documents,
certificates and other agreements as the Borrower may reasonably request to
confirm such Reclassification.


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ARTICLE V. YIELD PROTECTION, ETC.


Section 5.1.  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 reasonably 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”), to the extent 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 or modifies 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 Adjusted LIBOR 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 5.5.
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 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.


- 47 -











          (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); provided further that no Lender shall be entitled to
claim any additional cost, reduction in amounts, loss, tax or other additional
amount under this Article V if such Lender fails to provide such notice to the
Borrower within 180 days of the date such Lender becomes aware of the occurrence
of the event giving rise to the additional cost, reduction in amounts, loss, tax
or other additional amount.  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 in reasonable detail 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 5.2.  Suspension of LIBOR Loans.


          Anything herein to
the contrary notwithstanding, if, on or prior to the determination of Adjusted
LIBOR 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 Adjusted LIBOR for such Interest Period,
or
 
	
   
  	
  
 
  
	
  
 
  	
  

          (b)          the
Agent reasonably determines (which determination shall be conclusive) that
Adjusted LIBOR 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.


- 48 -










Section 5.3.  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 5.5. shall be applicable).


Section 5.4.  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 (excluding lost profits) that such Lender reasonably determines is
attributable to:


	
  
 
  	
  

          (a)          any
payment or prepayment (whether mandatory or optional) of a LIBOR 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 VI. to be satisfied) to borrow a LIBOR 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 in reasonable
detail 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 5.5.  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 5.1.(b) or 5.3.,
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 5.1.(b) or 5.3.,
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 5.1. or 5.3. 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.
 




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If such Lender gives notice to the Borrower (with a copy to the Agent) that the
circumstances specified in Section 5.1. or 5.3. 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 5.6.  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., 5.1. or 5.3. 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.


Section 5.7.  Assumptions Concerning Funding of LIBOR Loans.


          Calculation of all
amounts payable to a Lender under this Article V. 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 V.


Section 5.8.  Affected Lenders.


          If (a) a Lender
requests compensation pursuant to Section 3.12. or 5.1., 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 5.1.(b) or 5.3. but the obligation
of the Requisite Lenders shall not have been suspended under such Sections, or
(c) a Lender does not vote in favor of any amendment, modification or waiver to
this Agreement which, pursuant to Section 13.6., requires the vote of all of the
Lenders, and the Requisite Lenders shall have voted in favor of such amendment,
modification or waiver then, so long as there does not then exist any Default or
Event of Default, the Borrower may demand that such Lender (the “Affected
Lender”), and upon such demand the Affected Lender shall promptly, assign
its Commitment to an Eligible Assignee subject to and in accordance with the
provisions of Section 13.5.(d) for a purchase price equal to the aggregate
principal balance of all 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.  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 nor any Titled Agent 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 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 this Agreement (including, without limitation, pursuant to
Sections 3.12., 5.1. or 5.4.) with respect to the periods up to the date of
replacement.


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ARTICLE VI. CONDITIONS PRECEDENT


Section 6.1.  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 (subject to Section 6.3. in
the case of clauses (iv) and (v)), in form and substance satisfactory to
the Agent:

	
  
 
  	
  

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

            (ii)         Revolving
Notes executed by the Borrower, payable to each Lender and complying with the
applicable provisions of Section 2.10., and the Swingline Note executed by
the Borrower;
 
	
   
  	
  
 
  
	
  
 
  	
  

          (iii)          the
Guaranty executed by the Parent and each Material Subsidiary (other than an
Excluded Subsidiary or a Foreign Subsidiary) existing as of the Effective
Date;
 
	
  
 
  	
  
 
  
	
  
 
  	
  

            (iv)        a
copy of the articles of incorporation, articles of organization, certificate of
limited partnership or other comparable organizational instrument (if any) of
the Borrower and each other Loan Party certified (x) by the Secretary of
State of the state of formation of such Loan Party as of a date not more that 6
months prior to the delivery thereof to the Agent and (y) by the Secretary
or Assistant Secretary (or other individual performing similar functions) of
such Loan Party as being a true, correct and complete copy thereof as of the
date of delivery thereof to the Agent;
 
	
  
 
  	
  
 
  
	
  
 
  	
  

            (v)         a
copy of a certificate of good standing or certificate of similar meaning with
respect to each Loan Party issued by the Secretary of State of the state of
formation of each such Loan Party and copies of 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 Loan Party is required to be so qualified and where the failure to be
so qualified could reasonably be expected to have a Material Adverse Effect, in
each case, issued as of a date not more than 6 months prior to the date of
delivery thereof to the Agent;
 



- 51 -









	
  
 
  	
  

            (vi)        a
certificate of incumbency signed by the Secretary or Assistant Secretary (or
other individual performing similar functions) of each Loan Party with respect
to each of the officers of such Loan Party authorized to execute and deliver the
Loan Documents to which such Loan Party is a party, and in the case of the
Borrower, and the officers of the Borrower then authorized to deliver Notices of
Borrowing, Notices of Swingline Borrowings, Notices of Continuation and Notices
of Conversion and to request the issuance of Letters of Credit;
 
	
  
 
  	
  
 
  
	
  
 
  	
  

            (vii)       copies
certified by the Secretary or Assistant Secretary (or other individual
performing similar functions) of each Loan Party of (i) the by-laws of such
Loan Party, 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 Loan Party to authorize the execution, delivery and performance of the Loan
Documents to which it is a party;
 
	
   
  	
  
 
  
	
  
 
  	
  

            (viii)      an
opinion of counsel to the Loan Parties, addressed to the Agent, the Lenders and
the Swingline Lender, addressing the matters set forth in
Exhibit I;
 
	
  
 
  	
  
 
  
	
  
 
  	
  

            (ix)        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;
 
	
  
 
  	
  
 
  
	
  
 
  	
  

            (x)         a
Compliance Certificate calculated as of the Effective Date (giving pro forma
effect to the financing evidenced by this Agreement and the use of the proceeds
of the Loans to be funded on the Agreement Date);
 
	
  
 
  	
  
 
  
	
  
 
  	
  

            (xi)        evidence
that arrangements have been made for the termination and release of the existing
Security Documents (as defined in the Existing Credit Agreement) upon the
occurrence of the Effective Date; and
 
	
   
  	
  
 
  
	
  
 
  	
  

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





          (b)          In
the good faith and reasonable 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 Parent, the Borrower and its other 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;
 




- 52 -









	
   
  	
  

             (ii)         no
litigation, action, suit, investigation or other arbitral, administrative or
judicial proceeding shall be pending or threatened in writing 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 any Loan Party to fulfill its
obligations under the Loan Documents to which it is a party; and


	
  
 
  	
  
 
  
	
  
 
  	
  


             (iii)        the
Parent, the Borrower and its other 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.
 




The provisions of clauses (iv) through (viii) of the immediately preceding
subsection (a) shall not apply to Accommodation Subsidiaries that are not
also Material Subsidiaries.


Section 6.2.  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 each 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 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.  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 VI. have been satisfied.


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Section 6.3.  Conditions Subsequent.


          Notwithstanding the
requirements of clauses (iv) and (v) of Section 6.1.(a), the Borrower may
deliver to the Agent each of the following items not later than March 23,
2007:



          (a)          a
copy of the articles of incorporation, articles of organization, certificate of
limited partnership or other comparable organizational instrument (if any) of
the Borrower and each other Loan Party certified by the Secretary of State of
the state of formation of such Loan Party as of a date not more that 6 months
prior to the delivery thereof to the Agent; and



          (b)          a
copy of a certificate of good standing or certificate of similar meaning with
respect to each Loan Party issued by the Secretary of State of the state of
formation of each such Loan Party and copies of 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 Loan Party is required to be so qualified and where the failure to be
so qualified could reasonably be expected to have a Material Adverse Effect, in
each case, issued as of a date not more than 6 months prior to the date of
delivery thereof to the Agent.


ARTICLE VII. REPRESENTATIONS AND WARRANTIES


Section 7.1.  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 Parent and the Borrower represent and warrant to
the Agent and each Lender as follows:
 

          (a)          Organization;
Power; Qualification.  Each of the Parent, the Borrower, the other Loan
Parties and each other Subsidiary 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 7.1.(b)
is a complete and correct list of all Subsidiaries of the Parent 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 or a Significant Subsidiary.  Except as disclosed in such
Schedule, as of the Agreement Date (i) each of the Parent and its
Subsidiaries owns, free and clear of all Liens (other than Permitted Liens), and
has the unencumbered right to vote, all 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 7.1.(b) correctly sets forth all Unconsolidated Affiliates of the
Parent, 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 Parent.


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          (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.  Each 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 any Loan Party is a party have been duly executed
and delivered by the duly authorized officers, agents and/or signatories 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 and as 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
any 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 any Loan Party; (ii) conflict with, result in a breach of
or constitute a default under the organizational documents of any Loan Party, or
any indenture, agreement or other instrument to which any 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 any Loan
Party.



          (e)          Compliance
with Law; Governmental Approvals.  Each 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 such Loan Party except for noncompliances which, and Governmental
Approvals the failure to possess which, could not, in the aggregate, reasonably
be expected to cause a Default or Event of Default or have a Material Adverse
Effect.



          (f)          Title
to Properties; Liens.  As of the Agreement Date, Part I of
Schedule 7.1.(f) is a complete and correct listing of all of the real
property owned or leased by the Parent, the Borrower and each other
Subsidiary.  Each such Person has good, marketable and legal title to, or a
valid leasehold interest in, its respective assets (other than Permitted Liens
and Liens on assets of an Excluded Subsidiary securing the Indebtedness which
causes such Subsidiary to be an Excluded Subsidiary).  As of the Agreement
Date, there are no Liens against any assets of the Parent, the Borrower or any
other Subsidiary except for Permitted Liens and Liens on assets of an Excluded
Subsidiary securing the Indebtedness which causes such Subsidiary to be an
Excluded Subsidiary.


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          (g)          Existing
Indebtedness.  Schedule 7.1.(g) is, as of December 31, 2006,
a complete and correct listing of all Indebtedness of the Parent and its
Subsidiaries, including without limitation, Guarantees of the Parent and its
Subsidiaries, and indicating whether such Indebtedness is Secured Indebtedness
or Unsecured Indebtedness.  Except as set forth on Schedule 7.1.(g),
during the period from such date to the Agreement Date, neither the Parent nor
any Subsidiary incurred any material Indebtedness.



          (h)          Material
Contracts.  Excluding Material Contracts evidencing Indebtedness listed
on Schedule 7.1.(g), if any, Schedule 7.1.(h) is, as of the Agreement
Date, a true, correct and complete listing of all Material Contracts.  No
event or condition which with the giving of notice, the lapse of time, or both,
would permit any party to any such Material Contract to terminate such Material
Contract exists.



          (i)          Litigation. 
Except as set forth on Schedule 7.1.(i), there are no actions, suits,
investigations or proceedings pending (nor, to the knowledge of the Parent, are
there any actions, suits or proceedings threatened) against or in any other way
relating adversely to or affecting the Parent or any of its Subsidiaries or any
of their 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.



          (j)          Taxes. 
Subject to applicable extensions, all federal, state and other tax returns of
the Parent and its Subsidiaries 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 Parent and its Subsidiaries and their
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 8.6.  As of the Agreement Date, none of the United States
income tax returns of the Parent or any of its Subsidiaries is under
audit.  All charges, accruals and reserves on the books of the Parent 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 Parent has furnished to each Lender copies of
(i) the audited consolidated balance sheet of the Parent and its
consolidated Subsidiaries for the fiscal year ending December 31, 2005, and the
related audited consolidated statements of operations, cash flows and
shareholders’ equity for the fiscal year ending on such date, with the
opinion thereon of KPMG LLP, and (ii) the unaudited consolidated balance
sheet of the Parent and its consolidated Subsidiaries for the fiscal quarter
ending September 8, 2006, and the related unaudited consolidated statements of
operations, cash flows and shareholders’ equity of the Parent and its
consolidated Subsidiaries for the period of three fiscal quarters ending on such
date.  Such financial statements (including in each case related schedules
and notes) present fairly, in all material respects and in accordance with GAAP
consistently applied throughout the periods involved, the consolidated financial
position of the Parent 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).  Neither the Parent 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 that would be required to be set forth
in its financial statements or in the notes thereto, except as referred to or
reflected or provided for in said financial statements.


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          (l)          No
Material Adverse Change.  Since December 31, 2005, there has been no
material adverse change in the business, assets, liabilities, financial
condition or results of operations of the Parent and its Subsidiaries or the
Borrower and its Subsidiaries, in each case, taken as a whole.  Each of the
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
Parent, the Borrower or any Subsidiary constitutes “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 Section 406 of ERISA or Section 4975
of the Internal Revenue Code.



          (o)          Absence
of Defaults.  None of the Parent, the Borrower or any other Subsidiary
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, which, in any such case: 
(i) constitutes a Default or an Event of Default; or (ii) constitutes,
or which with the passage of time, the giving of notice, or both, would
constitute, a default or event of default by the Parent, the Borrower or any
other Subsidiary under any agreement (other than this Agreement) or judgment,
decree or order to which the Parent, the Borrower or any other Subsidiary is a
party or by which the Parent, the Borrower or any other Subsidiary or any of
their respective properties may be bound where such default or event of default
could, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.


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          (p)          Environmental
Laws.  Each of the Parent, the Borrower and its other Subsidiaries 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) neither the Parent or the Borrower is aware of, and has
received notice of, any past, present, or future events, conditions,
circumstances, activities, practices, incidents, actions, or plans which, with
respect to the Parent, the Borrower or any of its other Subsidiaries, 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 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 Parent, the Borrower or any of its other
Subsidiaries relating in any way to Environmental Laws.



          (q)          Investment
Company; Etc.  None of the Parent, the Borrower or any other Subsidiary
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.  None of the Parent, the Borrower or any other Subsidiary is
engaged principally, or as one of its important activities, in the business of
extending credit for the purpose, whether immediate, incidental or ultimate, of
buying or carrying “margin stock” within the meaning of
Regulation U of the Board of Governors of the Federal Reserve
System.



          (s)          Affiliate
Transactions.  Except as permitted by Section 10.11., none of the
Parent, the Borrower or any other Subsidiary is a party to any transaction with
an Affiliate.



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


- 58 -











          (u)          Business. 
As of the Agreement Date, the Parent, the Borrower and the other Subsidiaries
are engaged in the business of developing, construction, acquiring, owning and
operating hotel properties, 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 Parent, the Borrower or any of its
other Subsidiaries ancillary to the transactions contemplated hereby.



          (w)          Accuracy
and Completeness of Information.  The written information, reports and
other 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 Parent, the Borrower or any other Subsidiary in connection
with or relating in any way to this Agreement, taken as a whole, do not contain
any untrue statement of a fact material to the creditworthiness of the Parent,
the Borrower or any other Subsidiary and do not omit 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 (including in each case all related schedules and notes) furnished to
the Agent or any Lender by, on behalf of, or at the direction of, the Parent,
the Borrower or any other Subsidiary 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, 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
Parent, the Borrower or any other Subsidiary 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 but with it being understood that such
projections and statement are not a guarantee of future performance.  As of
the Effective Date, no fact is known to the Parent or the Borrower which has
had, or may in the future have (so far as the Parent or the Borrower can
reasonably foresee), a Material Adverse Effect which has not been set forth in
the financial statements referred to in Section 7.1.(k) or in such
information, reports or other data or otherwise disclosed in writing to the
Agent and the Lenders.



          (x)          REIT
Status.  For all dates after January 1, 2005, the Parent is organized
and operated in a manner such that upon its election of REIT status, it shall be
treated as a REIT for purposes of the Internal Revenue Code (beginning with the
effective date of such election) and each of its Subsidiaries that are
corporations (if any) are organized and operated in a manner such that upon such
election they will qualify as Qualified REIT Subsidiaries or Taxable REIT
Subsidiaries (beginning with the effective date of such election), except where
a Subsidiary’s failure to so qualify could not reasonably be expected to
have an adverse effect on the Parent’s qualification as a REIT.  For
all dates thereafter, the Parent is qualified as a REIT and each of its
Subsidiaries that is a corporation is a Qualified REIT Subsidiary or Taxable
REIT Subsidiary (beginning with the effective date of such election), except
where a Subsidiary’s failure to so qualify could not reasonably be expected
to have an adverse effect on the Parent’s qualification as a
REIT.



          (y)          Unencumbered
Borrowing Base Properties.  Each of the Properties included in
calculations of the Unencumbered Borrowing Base Value satisfies all of the
requirements contained in the definition of “Eligible Unencumbered
Borrowing Base Property” (except to the extent such requirements were
waived by the Requisite Lenders pursuant to Section 4.1.(c) at the time such
Property was approved as an Unencumbered Borrowing Base Property).


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          (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 7.2.  Survival of Representations and Warranties, Etc.


          All statements
contained in any certificate, financial statement or other instrument delivered
by or on behalf of the Parent, the Borrower or any other Subsidiary 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 thereto or any statement contained in any
certificate, financial statement or other instrument delivered by or on behalf
of the Parent and the Borrower prior to the Agreement Date and delivered to the
Agent or any Lender in connection with the underwriting or closing of the
transactions contemplated hereby) shall constitute representations and
warranties made by the Parent and or the Borrower in favor of the Agent or any
of 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, the date on which any
extension of the Termination Date is effectuated pursuant to Section 2.12. 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 not prohibited under the Loan Documents.  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 VIII. AFFIRMATIVE COVENANTS


          For so long as this
Agreement is in effect, unless the Requisite Lenders (or, if required pursuant
to Section 13.6., all of the Lenders) shall otherwise consent in the manner
provided for in Section 13.6., the Parent and the Borrower shall comply
with the following covenants:


Section 8.1.  Preservation of Existence and Similar Matters.


          Except as otherwise
permitted under Section 10.7., the Parent and the Borrower shall, and shall
cause each Subsidiary 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 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.


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Section 8.2.  Compliance with Applicable Law and Material Contracts.


          The Parent and the
Borrower shall, and shall cause each Subsidiary to, comply with (a) all
Applicable Laws, 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 all Material Contracts
to which it is a party, the failure with which to comply could give any other
party thereto the right to terminate such Material Contract.


Section 8.3.  Maintenance of Property.


          In addition to the
requirements of any of the other Loan Documents, the Parent and the Borrower
shall, and shall cause each Subsidiary to, (a) protect and preserve all of its
respective material properties, including, but not limited to, all Intellectual
Property (to the extent reasonably necessary in connection with operations), and
maintain in good repair, working order and condition all tangible properties,
ordinary wear and tear and insured casualty losses excepted, and (b)  make
or cause to be made all repairs, renewals, replacements and additions to such
properties necessary or appropriate in the Borrower’s good faith and
reasonable judgment so that the business carried on in connection therewith may
be properly and advantageously conducted at all times.


Section 8.4.  Conduct of Business.


          The Parent and the
Borrower shall, and shall cause its Subsidiaries taken as a whole to, carry on
the business as described in Section 7.1.(u).


Section 8.5.  Insurance.


          The Parent and the
Borrower shall, and shall cause each Subsidiary to, maintain insurance (on a
replacement cost basis) with financially sound and reputable insurance companies
(with an A.M. Best policyholders rating of at least A-IX (with respect to
liability) or A-X (with respect to property damage)) against such risks
(including, without limitation, acts of terrorism) and in such amounts as is
customarily maintained by prudent Persons engaged in similar businesses and in
similar locations 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; provided, that so long as
Marriott International, Inc. or its affiliates are property managers of any
Property, insurance with respect to such Property may be maintained under the
blanket policy provided by Marriott International, Inc.


Section 8.6.  Payment of Taxes and Claims.


          The Parent and the
Borrower shall, and shall cause each Subsidiary to, pay and discharge before
delinquent (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 (i) which is being contested in good
faith by appropriate proceedings which operate to suspend the collection thereof
and for which adequate reserves have been established on the books of the
Parent, the Borrower or such Subsidiary, as applicable, in accordance with GAAP
or (ii) to the extent covered by title insurance.


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Section 8.7.  Visits and Inspections.


          The Parent and the
Borrower shall, and shall cause each Subsidiary to, permit representatives or
agents of any Lender or the Agent, from time to time after reasonable prior
notice and in a manner that does not unreasonably disrupt the normal business
operations of the Parent, the Borrower or such Subsidiary, in each case so long
as no Event of Default shall be in existence, as often as may be reasonably
requested, but only during normal business hours, as the case may be, to: 
(a) visit and inspect all properties of the Parent, the Borrower or such
Subsidiary 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; 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 Parent and the Borrower shall execute an authorization letter
addressed to their accountants authorizing the Agent or any Lender to discuss
the financial affairs of the Parent, the Borrower and any other Subsidiary with
their accountants.  The Parent may designate a representative to accompany
any Lender or Agent in connection with such visits, inspections and discussion
unless a Default or Event of Default exists.  The exercise by a Lender or
the Agent of its rights under this Section shall be at the expense of such
Lender or the Agent, as applicable, unless an Event of Default shall exist in
which case such exercise shall be at the expense of the Borrower.


Section 8.8.  Use of Proceeds; Letters of Credit.


          The Borrower shall
use the proceeds of the Loans and the Letters of Credit for general corporate
purposes only, to include, without limitation, acquisitions, repayment of
Indebtedness, capital expenditures, working capital, short-term bridge advances
and payment of fees and expenses related to this Agreement and the other
transactions contemplated by this Agreement and the other Loan Documents. 
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 to
extend credit to others for the purpose of purchasing or carrying any such
margin stock or (b) to fund any operations in, to finance any investments
or activities in, or make any payments to, a Sanctioned Person or Sanctioned
Entity.


Section 8.9.  Environmental Matters.


          The Parent and the
Borrower shall, and shall cause all of the Subsidiaries to, comply with all
Environmental Laws the failure with which to comply could reasonably be expected
to have a Material Adverse Effect.  If the Parent, the Borrower, or any
other Subsidiary 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 Parent, the Borrower or
any other Subsidiary alleging violations of any Environmental Law or requiring
any such Person 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 any such Person 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 with a copy of
such notice promptly, and in any event within 10 Business Days, after the
receipt thereof.  The Parent and the Borrower shall, and shall cause the
Subsidiaries to, take promptly all actions necessary to prevent the imposition
of any material Liens on any of their respective properties arising out of or
related to any Environmental Laws (other than a Lien (i) which is being
contested in good faith by appropriate proceedings which operate to suspend the
enforcement thereof and for which adequate reserves have been established on the
books of the Parent, the Borrower or such Subsidiary, as applicable, in
accordance with GAAP, (ii) which has been bonded-off in a manner reasonably
acceptable to the Agent or (iii) which could not reasonably be expected to have
a Material Adverse Effect).


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Section 8.10.  Books and Records.


          The Parent and the
Borrower shall, and shall cause each Subsidiary 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 8.11.  Further Assurances.


          The Parent and the
Borrower shall, at their 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 consistent with the existing terms and
conditions of the Loan Documents, 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 existing provisions and purposes of this
Agreement and the other Loan Documents.


Section 8.12.  REIT Status.


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


Section 8.13.  Exchange Listing.


          The Parent shall
maintain at least one class of common Equity Interest of the Parent 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.
 
Section 8.14.  Additional Guarantors.



          (a)          Within
30 days of any Person (other than an Excluded Subsidiary or a Foreign
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 with respect to
such Material Subsidiary that would have been delivered under
Sections 6.1.(a)(iv) through (viii) if such Material Subsidiary had been
one on the Effective Date (without taking into account the effect of
Section 6.3.); provided, however, promptly (and in any event
within 30 days) upon any Excluded Subsidiary that is a Material Subsidiary
ceasing to be subject to the restriction which prevented it from delivering an
Accession Agreement pursuant to this Section, such Subsidiary shall comply with
the provisions of this Section.  


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          (b)          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 Section 4.1.(d) with respect to a
Subsidiary that owns or leases an Unencumbered Borrowing Base
Property.


Section 8.15.  Release of Guarantors.


          The Borrower may
request in writing that the Agent release, and upon receipt of such request the
Agent shall release (subject to the terms of the Guaranty), 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 or a
Subsidiary, or in the case of a Material Subsidiary that does not own or lease
an Unencumbered Borrowing Base Property, such release will not result in a
violation of Section 10.1.(h); (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 10.1.; and (iv) 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.  If such Guarantor owns an
Unencumbered Borrowing Base Property, then the release of such Guarantor shall
also be subject to and in accordance with Section 4.2.  The Agent
agrees to furnish to the Borrower, at the Borrower’s request and at the
Borrower’s sole cost and expense, any release, termination, or other
agreement or document evidencing the foregoing release as may be reasonably
requested by the Borrower.


ARTICLE IX. INFORMATION


          For so long as this
Agreement is in effect, unless the Requisite Lenders (or, if required pursuant
to Section 13.6., all of the Lenders) shall otherwise consent in the manner
set forth in Section 13.6., the Borrower shall furnish to each Lender (or
to the Agent if so provided below) at its Lending Office:
 
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Section 9.1.  Quarterly Financial Statements.


          As soon as available
and in any event within 5 days after the same is required to be filed with the
Securities and Exchange Commission (but in no event later than 50 days after the
end of each of the first, second and third fiscal quarters of the Parent), the
unaudited consolidated balance sheet of the Parent and its Subsidiaries as of
the end of such period and the related unaudited consolidated statements of
income and cash flows of the Parent 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 executive officer, chief financial officer or chief
accounting officer of the Parent, in his or her opinion, to present fairly, in
accordance with GAAP and in all material respects, the consolidated financial
position of the Parent and its Subsidiaries as at the date thereof and the
results of operations for such period (subject to normal year-end audit
adjustments); provided, however, the Parent shall not be required to deliver an
item required under this Section if such item is contained in a Form 10-Q filed
by the Parent with the Securities and Exchange Commission (or any Governmental
Authority substituted therefore) and is publicly available to the Agent and the
Lenders.  


Section 9.2.  Year-End Statements.


          As soon as available
and in any event within 5 days after the same is required to be filed with the
Securities and Exchange Commission (but in no event later than 120 days after
the end of each fiscal year of the Parent), the audited consolidated balance
sheet of the Parent and its Subsidiaries as at the end of such fiscal year and
the related audited consolidated statements of income, shareholders’ equity
and cash flows of the Parent 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 (a) certified by the chief executive
officer, chief financial officer or chief accounting officer of the Parent, in
his or her opinion, to present fairly, in accordance with GAAP, the consolidated
financial position of the Parent, the Borrower and its other Subsidiaries as at
the date thereof and the results of operations for such period and
(b) accompanied by the report thereon of independent certified public
accountants of recognized national standing acceptable to the Agent, whose
certificate shall be unqualified; provided, however, the Parent shall not be
required to deliver an item required under this Section if such item is
contained in a Form 10-K filed by the Parent with the Securities and Exchange
Commission (or any Governmental Authority substituted therefore) and is publicly
available to the Agent and the Lenders.  


Section 9.3.  Compliance Certificate.


          At the time
financial statements are furnished pursuant to Sections 9.1. and 9.2., and
if the Requisite Lenders reasonably believe that an Event of Default specified
in Sections 11.1.(a), 11.1.(b) and 11.1.(f) or a Default specified in Section
11.1.(g) may occur, then within 10 days of the Agent’s request with respect
to any other fiscal period, a certificate substantially in the form of
Exhibit J (a “Compliance Certificate”) executed by the chief
financial officer or chief accounting officer of the Parent: 
(a) setting forth in reasonable detail as at the end of such quarterly
accounting period, fiscal year, or other fiscal period, as the case may be, the
calculations required to establish whether or not the Borrower was in compliance
with the covenants contained in Sections 10.1., 10.2. and 10.4., and
(b) stating that, to the best of his or her knowledge, information and
belief 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.  Together with the
delivery of each Compliance Certificate, the Borrower shall deliver (A) a
report, in form and detail reasonably satisfactory to the Agent, setting forth a
statement of Funds From Operations for the fiscal period then ending; and
(B) a list of all Persons that have become a Material Subsidiary or a
Significant Subsidiary since the date of the Compliance Certificate most
recently delivered by the Borrower hereunder.


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Section 9.4.  Other Information.



          (a)          Management
Reports.  Promptly upon receipt thereof, copies of all management
reports, if any, submitted to the Parent or its Board of Directors by its
independent public accountants;



          (b)          Securities
Filings.  Within 5 Business Days of the filing thereof, copies of
all registration statements (excluding the exhibits thereto (unless reasonably
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 Parent, the Borrower, or any other Subsidiary
shall file with the Securities and Exchange Commission (or any Governmental
Authority substituted therefor) or any national securities exchange;



          (c)          Shareholder
Information.  Promptly upon the mailing thereof to the shareholders of
the Parent 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 Parent, the Borrower or any other Subsidiary;



          (d)          Partnership
Information.  Promptly upon the mailing thereof to the partners of the
Borrower generally, copies of all financial statements, reports and proxy
statements so mailed;



          (e)          Quarterly
Property Schedules.  At the time financial statements are furnished
pursuant to Sections 9.1. and 9.2., a schedule of all Properties owned or
leased by the Parent, the Borrower and each other Subsidiary of the Parent as of
the fiscal quarter most recently ended, and the applicable Net Operating Income
of each such Property, such schedule certified by the chief financial officer or
chief accounting officer of the Parent as true, correct and complete as of the
date such information is delivered;



          (f)          Development
Property Updates.  At the time financial statements are furnished
pursuant to Sections 9.1. and 9.2., a schedule of all Development
Properties of the Parent, the Borrower and each other Subsidiary which are under
development as of the fiscal quarter most recently ended, setting forth for each
such Property its percentage of completion, the estimated completion date, the
total amount of development funded and the status of such development against
the development budget;



          (g)          Litigation. 
To the extent the Parent, the Borrower or any other 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 Parent, the Borrower or any other
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
Parent, the Borrower or any of its Subsidiaries are being audited;


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



          (i)          Default.
Notice of the occurrence of any of the following promptly upon a Responsible
Officer of the Parent obtaining knowledge thereof:  (i) any Default or
Event of Default or (ii) any event which with the passage of time, the giving of
notice, or otherwise, would permit any party to a Material Contract to terminate
such Material Contract;



          (j)          Judgments. 
Prompt notice of any order, judgment or decree in excess of $5,000,000 having
been entered against the Parent, the Borrower or any other Subsidiary of any of
their respective properties or assets;



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



          (l)          Material
Contracts.  Promptly upon entering into any Material Contract after the
Agreement Date (other than a Material Contract evidencing Indebtedness), a copy
to the Agent of such Material Contract unless such Material Contract is
otherwise publicly available to the Agent in a Form 10-K, 10-Q and/or 8-K (or
their equivalents) or any other periodic report which the Parent, the Borrower,
or any other Subsidiary files with the Securities and Exchange Commission;
provided, that the Borrower shall not be required to deliver to the Agent a copy
of any Material Contract that contains a confidentiality provision prohibiting
such disclosure; provided further that the Borrower shall use its commercially
reasonable efforts to obtain the other party’s consent to disclose such
Material Contract to the Agent and the Lenders;



          (m)          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, and of
which has resulted or could reasonably be expected to result in the imposition
of a Lien or the posting of a bond or other security, a certificate of the chief
executive officer or chief financial officer of the Parent setting forth details
as to such occurrence and the action, if any, which the Parent or applicable
member of the ERISA Group is required or proposes to take; 


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          (n)          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); 




          (o)          Material/Significant
Subsidiary.  Prompt notice of any Person becoming a Material Subsidiary
or a Significant Subsidiary;



          (p)          Material
Asset Sales.  Prompt notice of the sale, transfer or other disposition
of any assets having an undepreciated book value of at least $20,000,000 of the
Borrower, any Subsidiary or any other Loan Party to any Person other than the
Borrower, any Subsidiary or any other Loan Party; and



          (q)          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 Parent, the
Borrower or any of its other Subsidiaries as the Agent or any Lender may
reasonably request (subject to limitations imposed under confidentiality
requirements and agreements to which the Parent, Borrower or a Subsidiary is
subject).


Section 9.5.  Electronic Delivery of Certain Information.



          (a)          The
Borrower may deliver documents, materials and other information required to be
delivered pursuant to Article IX. (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 by the Agent from
time to time.  The Agent shall promptly notify the Borrower of a change of
any such e-mail address of the Agent.  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 9.1., 9.2., and 9.4.(b) and (c) by posting any such Information
to the Parent’s internet website (as of the Agreement Date,
www.diamondrockhospitality.com) or when such information is available on the
website of the Securities and Exchange Commission (or any Governmental Authority
substituted therefore)(as of the Agreement Date, www.sec.gov).  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 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 13.1.,
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.


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          (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 the
Borrower to 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 9.3.



          (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 9.6.  Public/Private Information.


          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”.


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ARTICLE X. NEGATIVE COVENANTS


          For so long as this
Agreement is in effect, unless the Requisite Lenders (or, if required pursuant
to Section 13.6., all of the Lenders) shall otherwise consent in the manner
set forth in Section 13.6., the Parent and the Borrower shall comply with
the following covenants, as applicable:


Section 10.1.  Financial Covenants.


          The Parent shall not
permit:



          (a)          Maximum
Leverage Ratio.  The ratio of (i) Total Indebtedness to
(ii) Total Asset Value, to exceed 0.65 to 1.00 at any time.



          (b)          Minimum
Fixed Charge Coverage Ratio.  The ratio of (i) Adjusted EBITDA of
the Parent and its Subsidiaries for the fiscal quarter of the Parent most
recently ending to (ii) Fixed Charges for such period, to be less than 1.60
to 1.00 at any time.



          (c)          Floating
Rate Indebtedness.  The ratio of (i) Floating Rate Indebtedness of
the Parent and its Subsidiaries determined on a consolidated basis to
(ii) Total Indebtedness, to exceed 0.35 to 1.00 at any time.



          (d)          Minimum
Tangible Net Worth.  Tangible Net Worth at any time to be less than
(i) $500,000,000 plus (ii) 75% of the Net Tangible Proceeds of
all Equity Issuances effected by the Parent and its Subsidiaries after September
30, 2006 (other than Equity Issuances to the Parent, the Borrower or any
Subsidiary).



          (e)          Minimum
Implied Debt Service Ratio.  The ratio of (i) Unencumbered
Borrowing Base Property NOI for the period of twelve consecutive months most
recently ended to (ii) Implied Debt Service for such period, to be
less than 1.50 to 1.00 at any time.  If an Unencumbered Borrowing Base
Property has not continuously operated for at least one period of twelve
consecutive months, then the Unencumbered Borrowing Base Property NOI of such
Unencumbered Borrowing Base Property shall be calculated by annualizing the
historical Net Operating Income of such Unencumbered Borrowing Base Property for
the most recently ending period for which it has been in continuous operation,
determined on a pro forma basis reasonably acceptable to the Agent.



          (f)          Maximum
Unencumbered Leverage Ratio.  The ratio of (i) Unsecured
Indebtedness of the Borrower and its Subsidiaries determined on a consolidated
basis to (ii) the Unencumbered Borrowing Base Value, to exceed 0.65 to 1.00
at any time.



          (g)          Minimum
Number and Value of Unencumbered Borrowing Base Properties.  The number
of Unencumbered Borrowing Base Properties to be less than 4 or the aggregate
Unencumbered Borrowing Base Values of the Unencumbered Borrowing Base Properties
to be less than $150,000,000.


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          (h)          Adjusted
Total Asset Value.  The amount of Adjusted Total Asset Value
attributable to assets directly owned by the Borrower and the Guarantors to be
less than 90.0% of Adjusted Total Asset Value at any time.


Section 10.2.  Restricted Payments.


          Subject to the
following sentence, if an Event of Default exists, the Parent shall not, and
shall not permit any of its Subsidiaries to, declare or make any Restricted
Payments except that, subject to the following sentence, the Borrower may
declare and make cash distributions to the Parent and other holders of
partnership interests in the Borrower, and the Parent may declare and make cash
distributions to its shareholders, each, in an aggregate amount not to exceed
the minimum amount necessary for the Parent to remain in compliance with
Section 8.12.  If an Event of Default specified in
Section 11.1.(a), Section 11.1.(b), Section 11.1.(f) or
Section 11.1.(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 11.2.(a), the Parent shall not, and shall not permit any Subsidiary
to, make any Restricted Payments to any Person except that Subsidiaries may pay
Restricted Payments to the Parent, the Borrower or any other
Subsidiary.


Section 10.3.  Indebtedness.


          The Parent and the Borrower shall not, and shall not permit any Subsidiary to, incur, assume, or otherwise become obligated in respect of any Indebtedness 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 10.1.


Section 10.4. Certain Permitted Investments.


          The Parent and 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 Parent, the Borrower and such other Subsidiaries to exceed
the applicable limits set forth below:



          (a)          Investments
in Unconsolidated Affiliates and other Persons that are not Subsidiaries, such
that the aggregate value of such Investments (determined in a manner consistent
with the definition of Total Asset Value or, if not contemplated under the
definition of Total Asset Value, as determined in accordance with GAAP) exceeds
25.0% of Total Asset Value at any time;



          (b)          Development
Properties, such that the aggregate current book value of all such Development
Properties exceeds 20.0% of Total Asset Value at any time;


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          (c)          Unimproved
Land, such that the current book value of all Unimproved Land exceeds 10.0% of
Total Asset Value; and



          (d)          Mortgage
Receivables, such that such that the aggregate value of such Mortgage
Receivables exceeds 10.0% of Total Asset Value.


In addition to the foregoing limitations, the aggregate value of all of the
items subject to the limitations in the preceding clauses (a) through (d)
shall not exceed 30.0% of Total Asset Value at any time.


Section 10.5.  Investments Generally.


          The Parent and the
Borrower shall not, and shall not permit any Subsidiary 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:



          (a)          Investments
in Subsidiaries in existence on the Agreement Date and disclosed on Part I
of Schedule 7.1.(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
immediately prior to such Investment, and after giving effect thereto, no
Default or Event of Default is or would be in existence;



          (c)          Investments
permitted under Section 10.4.;



          (d)          Investments
in Cash Equivalents;



          (e)          intercompany
Indebtedness among (i) the Parent and the Borrower and (ii) the Borrower and its
Wholly Owned Subsidiaries provided that such Indebtedness is permitted by the
terms of Section 10.3.;



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



          (g)          any
other Investment as 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 10.6.  Liens; Negative Pledges; Other Matters.



          (a)          The
Parent and the Borrower shall not, and shall not permit any Subsidiary to,
create, assume, or incur any Lien (other than Permitted Liens and Liens on
assets of an Excluded Subsidiary securing the Indebtedness which causes such
Subsidiary to be an Excluded Subsidiary) 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.


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          (b)          The
Parent and the Borrower shall not, and shall not permit any Subsidiary to, enter
into, assume or otherwise be bound by any Negative Pledge except for a Negative
Pledge contained in any agreement (i)(x) evidencing Indebtedness which the
Parent, the Borrower or such Subsidiary may create, incur, assume, or permit or
suffer to exist under Section 10.3., (y) which Indebtedness is secured
by a Lien permitted to exist, and (z) which prohibits the creation of any
other Lien on only the property securing such Indebtedness as of the date such
agreement was entered into; or (ii) relating to the sale of a Subsidiary or
assets pending such sale, provided that in any such case the Negative Pledge
applies only to the Subsidiary or the assets that are the subject of such
sale.



          (c)          The
Parent and the Borrower shall not, and shall not permit any Subsidiary (other
than an Excluded Subsidiary) 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 Indebtedness owed to the Parent, the
Borrower or any other Subsidiary; (iii) make loans or advances to the
Parent, the Borrower or any other Subsidiary; or (iv) transfer any of its
property or assets to the Parent, the Borrower or any other Subsidiary, except
for any such encumbrances or restrictions, (A) contained in agreements
relating to the sale of a Subsidiary or assets pending such sale, or relating to
Indebtedness secured by a Lien on assets that the Borrower or such Subsidiary
may create, incur, assume, or permit or suffer to exist under Sections 10.3. and
10.6.(a), provided that in any such case the encumbrances and restrictions apply
only to the Subsidiary or the assets that are the subject of such sale or Lien,
as the case may be, (B) set forth in the organizational documents or other
agreements binding on or applicable to any Excluded Subsidiary or any Subsidiary
that is not a Wholly Owned Subsidiary (but only to the extent such encumbrance
or restriction covers any Equity Interest in such Subsidiary or the property or
assets of such Subsidiary) or (C) contained in an agreement that governs an
Investment in an Unconsolidated Affiliate (but only to the extent such
encumbrance or restriction covers any Equity Interest in such Unconsolidated
Affiliate).


Section 10.7.  Merger, Consolidation, Sales of Assets and Other
Arrangements.


          The Parent and the
Borrower shall not, and shall not permit any Subsidiary 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, any 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 so long as
(x) 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 be in existence, (y) if such action includes the sale of all Equity
Interests in a Subsidiary that is a Guarantor owned directly or indirectly by
the Parent, such Subsidiary can and will be released from the Guaranty in
accordance with Section 8.15. and (z) if such action includes the
disposition of an Unencumbered Borrowing Base Property (regardless of whether
such disposition takes the form of a direct sale of such Unencumbered Borrowing
Base Property, the sale of the Equity Interests of the Subsidiary that owns such
Unencumbered Borrowing Base Property or a merger of such Subsidiary), such
Unencumbered Borrowing Base Property can and will be released in accordance with
Section 4.2.;


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          (b)          the
Parent, the Borrower and the other Subsidiaries 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 a Loan Party so long as (i) the survivor of such
merger is such Loan Party or becomes a Loan Party at the time of such merger,
(ii) immediately prior to such merger, and immediately thereafter and after
giving effect thereto, (x) no Default or Event of Default is or would be in
existence and (y) 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
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 (iii) the Borrower shall have given the Agent
at least 30-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 that does not own an Unencumbered Borrowing
Base Property with and into a Loan Party but the Borrower shall give the Agent
notice of any such merger promptly following the effectiveness of such merger);
and



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


Section 10.8.  Fiscal Year.


          The Parent shall not
change its fiscal year from that in effect as of the Agreement Date; provided,
that if Marriot International, Inc. shall change its fiscal year to a calendar
fiscal year, the Parent may change its fiscal year to a calendar fiscal
year.


Section 10.9.  Modifications to Material Contracts.


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


Section 10.10.  Modifications of Organizational Documents.


          The Parent and the
Borrower shall not, and shall not permit any 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.


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Section 10.11.  Transactions with Affiliates.


          The Parent and the
Borrower shall not, and shall not permit any Subsidiary 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 (other than the
Parent, the Borrower, any other Loan Party or any Wholly Owned Subsidiary),
except transactions in the ordinary course of and pursuant to the reasonable
requirements of the business of the Parent, the Borrower or any of the other
Subsidiaries and upon fair and reasonable terms which are no less favorable to
the Parent, the Borrower or such Subsidiary, as applicable, than would be
obtained in a comparable arm’s length transaction with a Person that is not
an Affiliate.


Section 10.12.  ERISA Exemptions.


          The Parent and 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 XI. DEFAULT


Section 11.1.  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:



          (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 3 Business
Days.
 

          (c)          Default
in Performance.  (i) The Borrower or the Parent shall fail to
perform or observe any term, covenant, condition or agreement contained in
Section 6.3., Section 9.4.(i) or in Article X. or (ii) any
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
Parent or such Loan Party obtains knowledge of such failure or (y) the date
upon which the Parent 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 any 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 any 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.


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          (e)          Indebtedness
Cross-Default; Derivatives Contracts.

	
  
 
  	
  

              (i)          any
Loan Party shall fail to pay when due and payable, within any applicable grace
or cure period, the principal of, or interest on, any Indebtedness (other than
the Loans) having an aggregate outstanding principal amount of $10,000,000 or
more (or $20,000,000 or more in the case of Nonrecourse Indebtedness) (all such
Indebtedness being “Material Indebtedness”); or
 
	
  
 
  	
  
 
  
	
  
 
  	
  

              (ii)         (x) the
maturity of any Material Indebtedness 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 Indebtedness
or (y) any Material Indebtedness shall have been required to be prepaid or
repurchased prior to the stated maturity thereof;
 
	
   
  	
  
 
  
	
  
 
  	
  

              (iii)        any
other event shall have occurred and be continuing which permits any holder or
holders of Material Indebtedness, any trustee or agent acting on behalf of such
holder or holders or any other Person, to accelerate the maturity of any such
Material Indebtedness or require any such Material Indebtedness to be prepaid or
repurchased prior to its stated maturity; or
 
	
  
 
  	
  
 
  
	
  
 
  	
  

              (iv)        there
occurs under any Derivatives Contract an Early Termination Date (as defined in
such Derivatives Contract) resulting from (A) any event of default under
such Derivatives Contract as to which any Loan Party is the Defaulting Party (as
defined in such Derivatives Contract) or (B) any Termination Event (as so
defined) under such Derivatives Contract as to which any Loan Party is an
Affected Party (as so defined) and, in either event, the Derivatives Termination
Value owed by any Loan Party as a result thereof is $10,000,000 or
more.
 





          (f)          Voluntary
Bankruptcy Proceeding.  Any Loan Party or any Significant 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.


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          (g)          Involuntary
Bankruptcy Proceeding.  A case or other proceeding shall be commenced
against any Loan Party or any other Significant 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 such Loan Party or such Significant Subsidiary (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.  Any 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 or hereof).



          (i)          Judgment. 
A judgment or order for the payment of money or for an injunction shall be
entered against any Loan Party or any other Subsidiary, 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 any Loan Party or any other Subsidiary, $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.



          (j)          Attachment. 
A warrant, writ of attachment, execution or similar process shall be issued
against any property of any Loan Party or any other Subsidiary which exceeds,
individually or together with all other such warrants, writs, executions and
processes, $10,000,000 in amount in the case of a Loan Party, or $20,000,000 in
amount in the case of any other Subsidiary that is not a Loan Party and, in each
case, 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.


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          (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 Plan or Plans having
aggregate Unfunded Liabilities in excess of $10,000,000 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 Plan or Plans having aggregate Unfunded Liabilities
in excess of $10,000,000; or a condition shall exist by reason of which the PBGC
would be entitled to obtain a decree adjudicating that any such 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/Change in Management.

	
  
 
  	
  

             (i)         Any
“person” or “group” (as such terms are used in Sections
13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”)), is or becomes the “beneficial owner” (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a Person
will be deemed to have “beneficial ownership” of all securities that
such Person has the right to acquire, whether such right is exercisable
immediately or only after the passage of time), directly or indirectly, of more
than 35% of the total voting power of the then outstanding voting stock of the
Parent;
 
	
  
 
  	
  
 
  
	
  
 
  	
  

             (ii)        During
any period of 12 consecutive months ending after the Agreement Date, individuals
who at the beginning of any such 12-month period constituted the Board of
Directors of the Parent (together with any new directors whose election by such
Board or whose nomination for election by the shareholders of the Parent was
approved by a vote of a majority of the directors then still in office who were
either 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 Board of Directors of the Parent then in office; or


	
   
  	
  
 
  
	
  
 
  	
  
             (iii)       The Parent or a
Wholly Owned Subsidiary of the Parent shall cease to be the sole general partner
of the Borrower or shall cease to have the sole and exclusive power to exercise
all management and control over the Borrower.
 




Section 11.2.  Remedies Upon Event of Default.


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


- 78 -











          (a)          Acceleration;
Termination of Facilities.

	
  
 
  	
  

             (i)          Automatic. 
Upon the occurrence of an Event of Default specified in Sections 11.1.(f)
or 11.1.(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 11.5. 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 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 11.5. 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 and the obligation of the Lenders to make
Loans hereunder and the obligation of the Agent to issue Letters of Credit
hereunder.  Further, if the Agent has exercised any of the rights provided
under the preceding sentence, the Swingline Lender shall:  (x) declare
the principal of, and accrued interest on, the Swingline Loans and the Swingline
Note at the time outstanding, and all of the other Obligations owing to the
Swingline Lender, 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
(y) terminate the Swingline Commitment and the obligation of the Swingline
Lender to make Swingline Loans.
 





          (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.


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          (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 11.3.  Remedies Upon Default.


          Upon the occurrence
of a Default specified in Section 11.1.(g), the Commitments shall
immediately and automatically terminate.


Section 11.4.  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 in respect of fees and expenses due under
Section 13.2.;
 
	
  
 
  	
  
 
  
	
  
 
  	
  

          (b)          amounts
due to the Lenders in respect of fees and expenses due under Section 13.2.,
pro rata in the amount then due each Lender;
 
	
  
 
  	
  
 
  
	
  
 
  	
  

          (c)          payments
of interest on Swingline Loans;
 
	
  
 
  	
  
 
  
	
  
 
  	
  

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

          (e)          payments
of principal of Swingline Loans;
 
	
  
 
  	
  
 
  
	
  
 
  	
  

          (f)          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 Letters of Credit, such amounts shall be paid to the Agent for
deposit into the Collateral Account);
 
	
  
 
  	
  
 
  
	
  
 
  	
  

          (g)          amounts
due the Agent and the Lenders pursuant to Sections 12.7. and
13.9.;
 
	
  
 
  	
  
 
  
	
  
 
  	
  

          (h)          payments
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
 
	
   
  	
  
 
  
	
  
 
  	
  

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




- 80 -










Section 11.5.  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 monies deposited in the Collateral Account 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 11.4.
 

          (e)          So
long as no Default or Event of Default exists, and to the extent amounts on
deposit in 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 of
the balances in the Collateral Account as exceed 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.


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Section 11.6.  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, after notice to the Borrower, 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 11.7.  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.


ARTICLE XII. THE AGENT


Section 12.1.  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 have so directed the Agent to
exercise such right or remedy.


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Section 12.2.  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 Parent, the Borrower or any other Loan
Party), 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 Parent, the Borrower or other Persons or inspect the
property, books or records of the Parent, 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. 
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 conditions precedent for initial Loans set forth in
Sections 6.1. and 6.2. that have not previously been waived by the
Requisite Lenders have been satisfied.


Section 12.3.  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.


- 83 -










Section 12.4.  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 Parent, 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 Loan Parties 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 Parent, the Borrower, other Loan Parties, other Subsidiaries and
other Affiliates (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.


Section 12.5.  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, as appropriate, a brief summary of all oral information provided
to the Agent by the Parent or 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) of receipt of
such communication.  Except as otherwise provided in this Agreement, 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.


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Section 12.6.  Lender Credit Decision, Etc.


          Each Lender
expressly acknowledges and agrees that neither the Agent nor any of its
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 Parent, the Borrower, any other Loan
Party, any Subsidiary or any other Person to such Lender and that no act by the
Agent hereafter taken, including any review of the affairs of the Parent, the
Borrower, any other Loan Party or any other Subsidiary, shall be deemed to
constitute any such representation or warranty by the Agent 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, any other Lender or counsel
to the Agent, or any of their respective officers, directors, employees and
agents, and based on the financial statements of the Parent, the Borrower, the
other Subsidiaries or any other Affiliate thereof, and inquiries of such
Persons, its independent due diligence of the business and affairs of the
Parent, the Borrower, the other Loan Parties, the other 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,
any other Lender or counsel to the Agent 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 under this Agreement or any of the
other Loan Documents, the Agent shall have no duty or responsibility to provide
any Lender with any credit or other information concerning the business,
operations, property, financial and other condition or creditworthiness of the
Parent, the Borrower, any other Loan Party or any other Affiliate thereof which
may come into possession of the Agent, or any of its officers, directors,
employees, agents, attorneys-in-fact or other affiliates.  Each Lender
acknowledges that the Agent’s legal counsel in connection with the
transactions contemplated by this Agreement is only acting as counsel to the
Agent and is not acting as counsel to such Lender.


Section 12.7.  Indemnification of Agent.


          Each Lender agrees
to indemnify the Agent (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, costs, expenses or 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) 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 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 gross negligence or willful misconduct as determined by a
court of competent jurisdiction in a final, non-appealable judgment or if the
Agent 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 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 (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 out-of-pocket expenses (including counsel fees of the counsel(s) of the
Agent’s own choosing) incurred by the Agent 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 to enforce the terms of the
Loan Documents and/or collect any Obligations, any “lender liability”
suit or claim brought against the Agent and/or the Lenders, and any claim or
suit brought against the Agent, and/or the Lenders arising under any
Environmental Laws.  Such out-of-pocket expenses (including counsel fees)
shall be advanced by the Lenders on the request of the Agent notwithstanding any
claim or assertion that the Agent is not entitled to indemnification hereunder
upon receipt of an undertaking by the Agent that the Agent will reimburse the
Lenders if it is actually and finally determined by a court of competent
jurisdiction that the Agent 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 for any
Indemnifiable Amount following payment by any Lender to the Agent in respect of
such Indemnifiable Amount pursuant to this Section, the Agent shall share such
reimbursement on a ratable basis with each Lender making any such
payment.


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Section 12.8.  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 gross negligence or willful misconduct upon 30-day’s
prior written notice by all Lenders (other than the Lender then acting as
Agent).  Upon any such resignation or removal, the Requisite Lenders 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 giving of notice of the removal of the
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 Agent, and the retiring 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 XII. 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.


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Section 12.9.  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 “Sole Lead Arranger”, “Book
Manager”, “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.


ARTICLE XIII. MISCELLANEOUS


Section 13.1.  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:

	
  
 
  	
  
DiamondRock   Hospitality Limited Partnership
  
	
  
 
  	
  
6903   Rockledge Dr., Suite 800
  
	
   
  	
  
Bethesda,   Maryland 20817
  
	
  
 
  	
  
Attn:  Michael Schecter
  
	
  
 
  	
  
Telephone:        (240)
744-1170
 
	
  
 
  	
  
Telecopy:          (240)
744-1199
 




          With a copy
to:

	
  
 
  	
  
Willkie Farr   & Gallagher LLP
  
	
  
 
  	
  
787 Seventh   Ave.
  
	
  
 
  	
  
New York,   New York 10019
  
	
  
 
  	
  
Attn: Steven   D. Klein
  
	
   
  	
  
Telephone:        (212)
728-8221
 
	
  
 
  	
  
Telecopy:          (212)
728-8111
 




          If to the
Agent:

	
  
 
  	
  
Wachovia   Bank, National Association
  
	
  
 
  	
  
301 S.   College Street, NC0172
  
	
  
 
  	
  
Charlotte,   North Carolina 28288
  
	
  
 
  	
  
Attn:  David M. Blackman
  
	
  
 
  	
  
Telephone:        (704)
374-6272
 
	
  
 
  	
  
Telecopy:          (704)
383-6205
 



- 87 -










          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. 
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 the Borrower (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 13.2.  Expenses.


          The Borrower agrees
(a) to pay or reimburse each of the Agent and the Arranger for all of its
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 Arranger 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 Arranger and the Lenders for all their reasonable 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 pursuant to the Loan Documents, (c) to pay, and indemnify and
hold harmless the Agent, the Arranger 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 Arranger and the Lenders for all their costs and
expenses incurred in connection with any bankruptcy or other proceeding of the
type described in Sections 11.1.(f) or 11.1.(g), including the reasonable
fees and disbursements of counsel to the Agent, the 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, 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.


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Section 13.3.  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 during the continuance of an Event of Default, 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
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 11.2., and although such
obligations shall be contingent or unmatured.


Section 13.4.  Litigation; Jurisdiction; Other Matters; Waivers.



          (a)          EACH
PARTY HERETO ACKNOWLEDGES THAT ANY DISPUTE OR CONTROVERSY BETWEEN OR AMONG THE
PARENT, 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, THE PARENT, 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 PARENT, 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 PARENT, THE BORROWER, THE AGENT AND EACH LENDER HEREBY AGREES THAT THE
FEDERAL DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK, OR, AT THE OPTION
OF THE AGENT, ANY STATE COURT LOCATED IN THE BOROUGH OF MANHATTAN OF NEW YORK,
NEW YORK, SHALL HAVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES
BETWEEN OR AMONG THE PARENT, 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 PARENT, 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.


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          (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, THE TERMINATION OR EXPIRATION OF ALL LETTERS
OF CREDIT AND THE TERMINATION OF THIS AGREEMENT.
 
Section 13.5.  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 neither the Parent or the Borrower may 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, (i) any
such participating interest must be for a constant and not a varying percentage
interest, and (ii) after giving effect to any such participation by a Lender,
the amount of its Commitment, or if the Commitments have been terminated, the
aggregate outstanding principal balance of Notes held by it, in which it has not
granted any participating interests must be equal to $10,000,000.  Except
as otherwise provided in Section 13.3., no Participant shall have any
rights or benefits under this Agreement or any other Loan Document.  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 (to the extent consent is required with respect thereto) 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 4.2.).  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, a 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.


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          (d)          Any
Lender may with the prior written consent of the Agent and, so long as no
Default or Event of Default exists, the Borrower (which consent, in each case,
shall not be unreasonably withheld (it being agreed that the Borrower’s
withholding of consent to an assignment which would result in the Borrower
having to pay amounts under Section 3.12. shall be deemed to be
reasonable)), assign to one or more Eligible Assignees (each an
“Assignee”) all or a portion of its rights and obligations under this
Agreement and the Notes (including all or a portion of its Commitments and the
Loans owing to such Lender); 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, after
giving effect to any partial assignment by a Lender, the Assignee shall hold,
and the assigning Lender shall retain, a Commitment, or if the Commitments have
been terminated, Loans having an outstanding principal balance, of at least
$10,000,000 and integral multiples of $1,000,000 in excess thereof; 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 a Lender party to this Agreement with respect to the assigned
interest as of the effective date of the Assignment and Acceptance Agreement and
shall have all the rights and obligations of a Lender with respect to the
assigned interest as set forth in such Assignment and Acceptance Agreement, and
the transferor Lender shall be released from its obligations hereunder with
respect to the assigned interest to a corresponding extent, and no further
consent or action by any party shall be required.  An Assignee, if not
already a Lender, shall deliver to the Agent an Administrative Details
Form.  Upon the consummation of any assignment pursuant to this subsection,
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 or the Assignee (and not the Borrower) shall pay to the Agent
an administrative fee for processing such assignment in the amount of
$3,500.  Anything in this Section to the contrary notwithstanding, no
Lender may assign or participate any interest in its Commitment or any Loan held
by it hereunder to the Borrower or any Subsidiary or Affiliate of the
Borrower.


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          (e)          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 (including the outstanding principal balance, accrued and unpaid interest
and other fees due thereunder) 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 shall 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.



          (f)          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 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.



          (g)          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 13.8.



          (h)          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.



          (i)          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 13.6.  Amendments.



          (a)          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).


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          (b)          Notwithstanding
the foregoing, without the prior written consent of each Lender adversely
affected thereby, no amendment, waiver or consent shall do any of the
following:


	
  
 
  	
  

          (i)          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
obligations;
 
	
  
 
  	
  
 
  
	
  
 
  	
  

          (ii)         reduce
the principal of, or interest rates that have accrued or that will be charged on
the outstanding principal amount of, any Loans or other Obligations;


	
  
 
  	
  
 
  
	
  
 
  	
  

          (iii)        reduce
the amount of any Fees payable hereunder or postpone any date fixed for payment
thereof;
 
	
  
 
  	
  
 
  
	
  
 
  	
  

          (iv)        modify
the definition of the term “Termination Date” (except as contemplated
under Section 2.12.) 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;
 
	
   
  	
  
 
  
	
  
 
  	
  

          (v)         amend
or otherwise modify the provisions of Section 3.2.;
 
	
  
 
  	
  
 
  
	
  
 
  	
  

          (vi)        modify
the definition of the term “Requisite Lenders” or otherwise 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 13.6. if such
modification would have such effect;
 
	
  
 
  	
  
 
  
	
  
 
  	
  

          (vii)       release
any Guarantor from the Guaranty other than as provided in Section
8.15.;
 
	
  
 
  	
  
 
  
	
  
 
  	
  

          (viii)      amend
or otherwise modify the provisions of Section 2.14.; or
 
	
   
  	
  
 
  
	
  
 
  	
  

          (ix)        increase
the number of Interest Periods permitted with respect to Loans under
Section 2.5.
 





          (c)          No
amendment, waiver or consent, unless in writing and signed by the Agent, in such
capacity, 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 2.2. 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.


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          (d)          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 12.5., 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 any 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
any Loan Party shall entitle such Loan Party to any other or further notice or
demand in similar or other circumstances.


Section 13.7.  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 or the Parent 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 or the Parent to review or inform
the Borrower or the Parent of any matter in connection with any phase of the
business or operations of the Borrower or the Parent.


Section 13.8.  Confidentiality.


          The Agent and each
Lender shall use reasonable efforts to assure that information about the Parent,
Borrower, the other Loan Parties and other Subsidiaries, and the Properties
thereof and their operations, affairs and financial condition, not generally
disclosed to the public, which is furnished to the Agent or any Lender pursuant
to the provisions of this Agreement or any other Loan Document, is used only for
the purposes of this Agreement and the other Loan Documents and shall not be
divulged to any Person other than the Agent, the Lenders, and their respective
agents who are actively and directly participating in the evaluation,
administration or enforcement of the Loan Documents and other transactions
between the Agent or such Lender, as applicable, and the Borrower, but in any
event the Agent and the Lenders may make disclosure:  (a) to any of
their respective affiliates (provided they shall agree to keep such information
confidential in accordance with the terms of this Section 13.8.); (b) as
reasonably requested by any bona fide Assignee, Participant or other transferee
in connection with the contemplated transfer of any Commitment or participations
therein as permitted hereunder (provided they shall agree to keep such
information confidential in accordance with the terms of this Section);
(c) as required or requested by any Governmental Authority or
representative thereof or pursuant to legal process or in connection with any
legal proceedings; (d) to the Agent’s or such Lender’s
independent auditors and other professional advisors (provided they shall be
notified of the confidential nature of the information); (e) after the
happening and during the continuance of an Event of Default, to any other
Person, in connection with the exercise by the Agent or the Lenders of rights
hereunder or under any of the other Loan Documents; (f) upon Borrower’s
prior consent (which consent shall not be unreasonably withheld), to any
contractual counter-parties to any swap or similar hedging agreement or to any
rating agency; and (g) to the extent such information (x) becomes
publicly available other than as a result of a breach of this Section or
(y) becomes available to the Agent or any Lender on a nonconfidential basis
from a source other than the Borrower or any Affiliate.


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Section 13.9.  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 reasonable 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 5.1. or expressly excluded from
the coverage of such Sections 3.12. or 5.1.) 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 Parent, 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 Parent, the
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; (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 Parent, 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; provided, however, that the Borrower
shall not be obligated to indemnify any Indemnified Party for (A) any acts
or omissions of such Indemnified Party in connection with matters described in
this subsection to the extent arising from the gross negligence or willful
misconduct of such Indemnified Party, as determined by a court of competent
jurisdiction in a final, non-appealable judgment or (B) Indemnified Costs
to the extent arising directly out of or resulting directly from claims of one
or more Indemnified Parties against another Indemnified Party.


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          (b)          The
Borrower’s indemnification obligations under this Section 13.9. 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 regard, 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 13.9. except to
the extent such failure to notify materially and adversely affects the Borrower.




          (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)          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 and, as provided above, all Indemnified Costs incurred 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 if (i) 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 (x) no
monetary relief is sought against such Indemnified Party in such Indemnity
Proceeding or (y) there is an allegation of a violation of law by such
Indemnified Party.


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          (f)          If
and to the extent that the obligations of the Borrower under this Section 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.



          (g)          The
Borrower’s obligations under this Section 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 13.10.  Termination; Survival.


          At such time as
(a) all of the Commitments have been terminated, (b) all Letters of Credit
have terminated, (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 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., 5.1.,
5.4., 12.7., 13.2. and 13.9. and any other provision of this Agreement and the
other Loan Documents, and the provisions of Section 13.4., 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.  The
Agent agrees to furnish to the Borrower, upon the Borrower’s request and at
the Borrower’s sole cost and expense, any release, termination, or other
agreement or document evidencing the foregoing termination.


Section 13.11.  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 13.12.  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 13.13.  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.


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Section 13.14.  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 13.15.  Obligations with Respect to Loan Parties.


          The obligations of
the Parent or 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 Parent or the Borrower may have that the Parent or the
Borrower does not control such Loan Parties.


Section 13.16.  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 of the Parent 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 Parent or 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.  Each of the Parent and 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 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 13.17.  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 13.18.  Construction.


          The Parent, the
Borrower, the Agent 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 Parent, the Borrower, the Agent and each
Lender.
 
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Section 13.19.  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 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]


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

	
  
 
  	
  
DIAMONDROCK   HOSPITALITY LIMITED PARTNERSHIP
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
By:
  	
  
DiamondRock   Hospitality Company, its sole General Partner
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
   
  	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
By:
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
 
  	
  


  
	
  
 
  	
  
 
  	
  
 
  	
  
Name:
  	
  
 
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  	
  


  
	
   
  	
  
 
  	
  
 
  	
  
Title:
  	
  
 
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  	
  


  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
DIAMONDROCK   HOSPITALITY COMPANY
  
	
  
 
  	
  
 
  
	
  
 
  	
  
 
  
	
  
 
  	
  
By:
  	
  
 
  	
  
 
  
	
   
  	
  
 
  	
  


  
	
  
 
  	
  
 
  	
  
Name:
  	
  
 
  
	
  
 
  	
  
 
  	
  
 
  	
  


  
	
  
 
  	
  
 
  	
  
Title:
  	
  
 
  
	
  
 
  	
  
 
  	
  
 
  	
  


  




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[Signature Page to Amended and Restated Credit Agreement
 with DiamondRock
Hospitality Limited Partnership]


	
  
 
  	
  
WACHOVIA   BANK, NATIONAL ASSOCIATION, as
   Agent, as a Lender and as Swingline Lender
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
By:
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  


  
	
  
 
  	
  
 
  	
  
Name:
  	
  
 
  
	
   
  	
  
 
  	
  
 
  	
  


  
	
  
 
  	
  
 
  	
  
Title:
  	
  
 
  
	
  
 
  	
  
 
  	
  
 
  	
  


  
	  
	  
	  
	  

	
  
 
  	
  
Commitment   Amount:
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
$_____________
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  



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[Signature Page to Amended and Restated Credit Agreement 
 with
DiamondRock Hospitality Limited Partnership]

	
  
 
  	
  
[LENDER]
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
By:
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  


  
	
   
  	
  
 
  	
  
Name:
  	
  
 
  
	
  
 
  	
  
 
  	
  
 
  	
  


  
	
  
 
  	
  
 
  	
  
Title:
  	
  
 
  
	
  
 
  	
  
 
  	
  
 
  	
  


  
	  
	  
	  
	  

	  
	  
	  
	  

	
  
 
  	
  
Commitment   Amount:
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
$_____________
  
	
   
  	
   
  	
   
  	
   
  



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