exv10w18






Exhibit 10.18




$125,000,000




CREDIT AGREEMENT



Dated as of [_________], 2010



among




CAMPUS CREST COMMUNITIES OPERATING PARTNERSHIP, LP,



as Borrower,



CAMPUS CREST COMMUNITIES, INC.,



as Parent Guarantor,



THE GUARANTORS NAMED HEREIN,



as Guarantors,



THE INITIAL LENDERS, INITIAL ISSUING BANK AND

SWING LINE BANK NAMED HEREIN,



as Initial Lenders, Initial Issuing Bank and Swing Line Bank, and



CITIBANK, N.A.,



as Administrative Agent and as Collateral Agent.



RAYMOND JAMES BANK FSB




Syndication Agent



RBC CAPITAL MARKETS BARCLAYS CAPITAL INC. GOLDMAN SACHS BANK USA



Co-Documentation Agents



CITIGROUP GLOBAL MARKETS INC.           RAYMOND JAMES BANK FSB



Joint Lead Arrangers and Joint Book Running Managers








 









 








T A B L E  OF  C O N T E N T S




	 	 	 	 	 
	Section	 	Page
	ARTICLE I
	DEFINITIONS AND ACCOUNTING TERMS

	 
	 	 	 	 
	SECTION 1.01. Certain Defined Terms
	 	 	1	 
	SECTION 1.02. Computation of Time Periods; Other Definitional Provisions
	 	 	34	 
	SECTION 1.03. Accounting Terms
	 	 	34	 
	 
	 	 	 	 
	ARTICLE II

	AMOUNTS AND TERMS OF THE ADVANCES AND THE LETTERS OF CREDIT

	 
	 	 	 	 
	SECTION 2.01. The Advances and the Letters of Credit
	 	 	34	 
	SECTION 2.02. Making the Advances
	 	 	36	 
	SECTION 2.03. Issuance of and Drawings and Reimbursement Under Letters of Credit
	 	 	38	 
	SECTION 2.04. Repayment of Advances
	 	 	41	 
	SECTION 2.05. Termination or Reduction of the Commitments
	 	 	42	 
	SECTION 2.06. Prepayments
	 	 	43	 
	SECTION 2.07. Interest
	 	 	44	 
	SECTION 2.08. Fees
	 	 	45	 
	SECTION 2.09. Conversion of Advances
	 	 	46	 
	SECTION 2.10. Increased Costs, Etc.
	 	 	47	 
	SECTION 2.11. Payments and Computations
	 	 	48	 
	SECTION 2.12. Taxes
	 	 	51	 
	SECTION 2.13. Sharing of Payments, Etc.
	 	 	54	 
	SECTION 2.14. Use of Proceeds
	 	 	54	 
	SECTION 2.15. Evidence of Debt
	 	 	55	 
	SECTION 2.16. Extension of Termination Date
	 	 	55	 
	SECTION 2.17. Increase in the Aggregate Commitments
	 	 	56	 
	 
	 	 	 	 
	ARTICLE III

	CONDITIONS OF LENDING AND ISSUANCES OF LETTERS OF CREDIT

	 
	 	 	 	 
	SECTION 3.01. Conditions Precedent to the Effectiveness of this Agreement
	 	 	58	 
	SECTION 3.02. Conditions Precedent to Each Borrowing, Issuance, Renewal, Extension and Increase
	 	 	66	 
	SECTION 3.03. Determinations Under Section 3.01 and 3.02
	 	 	67	 
	 
	 	 	 	 
	ARTICLE IV

	REPRESENTATIONS AND WARRANTIES

	 
	 	 	 	 
	SECTION 4.01. Representations and Warranties of the Loan Parties
	 	 	67	 






i









 






	 	 	 	 	 
	Section	 	Page
	ARTICLE V

	COVENANTS OF THE LOAN PARTIES

	 
	 	 	 	 
	SECTION 5.01. Affirmative Covenants
	 	 	79	 
	SECTION 5.02. Negative Covenants
	 	 	85	 
	SECTION 5.03. Reporting Requirements
	 	 	95	 
	SECTION 5.04. Financial Covenants
	 	 	99	 
	SECTION 5.05. Ground Lease Covenants
	 	 	101	 
	 
	 	 	 	 
	ARTICLE VI

	EVENTS OF DEFAULT

	 
	 	 	 	 
	SECTION 6.01. Events of Default
	 	 	103	 
	SECTION 6.02. Actions in Respect of the Letters of Credit upon Default
	 	 	106	 
	 
	 	 	 	 
	ARTICLE VII

	GUARANTY

	 
	 	 	 	 
	SECTION 7.01. Guaranty; Limitation of Liability
	 	 	106	 
	SECTION 7.02. Guaranty Absolute
	 	 	107	 
	SECTION 7.03. Waivers and Acknowledgments
	 	 	108	 
	SECTION 7.04. Subrogation
	 	 	109	 
	SECTION 7.05. Guaranty Supplements
	 	 	110	 
	SECTION 7.06. Indemnification by Guarantors
	 	 	110	 
	SECTION 7.07. Subordination
	 	 	110	 
	SECTION 7.08. Continuing Guaranty
	 	 	111	 
	 
	 	 	 	 
	ARTICLE VIII

	THE AGENTS

	 
	 	 	 	 
	SECTION 8.01. Authorization and Action; Appointment of Supplemental Collateral Agents
	 	 	112	 
	SECTION 8.02. Agents’ Reliance, Etc.
	 	 	113	 
	SECTION 8.03. Citibank and Affiliates
	 	 	113	 
	SECTION 8.04. Lender Party Credit Decision
	 	 	114	 
	SECTION 8.05. Indemnification by Lender Parties
	 	 	114	 
	SECTION 8.06. Successor Agents
	 	 	115	 
	SECTION 8.07. Relationship of Agents and Lenders
	 	 	116	 
	 
	 	 	 	 
	ARTICLE IX

	MISCELLANEOUS

	 
	 	 	 	 
	SECTION 9.01. Amendments, Etc.
	 	 	116	 
	SECTION 9.02. Notices, Etc.
	 	 	117	 
	SECTION 9.03. No Waiver; Remedies
	 	 	120	 
	SECTION 9.04. Costs and Expenses
	 	 	120	 
	SECTION 9.05. Right of Set-off
	 	 	121	 
	SECTION 9.06. Binding Effect
	 	 	122	 
	SECTION 9.07. Assignments and Participations; Replacement Notes
	 	 	122	 






ii









 






	 	 	 	 	 
	Section	 	Page
	SECTION 9.08. Execution in Counterparts
	 	 	126	 
	SECTION 9.09. No Liability of the Issuing Banks
	 	 	126	 
	SECTION 9.10. Confidentiality
	 	 	126	 
	SECTION 9.11. Release of Collateral
	 	 	129	 
	SECTION 9.12. Patriot Act Notification
	 	 	130	 
	SECTION 9.13. Jurisdiction, Etc.
	 	 	130	 
	SECTION 9.14. Governing Law
	 	 	130	 
	SECTION 9.15. WAIVER OF JURY TRIAL
	 	 	130	 






iii









 





	 	 	 	 	 

	SCHEDULES
	 	 	 	 
	 
	 	 	 	 
	Schedule I
	 	 	 	Commitments and Applicable Lending Offices
	Schedule II
	 	–	 	Borrowing Base Assets
	Schedule III
	 	–	 	Excluded Recourse Properties
	Schedule IV
	 	–	 	Ground Leases
	Schedule 4.01(b)
	 	–	 	Subsidiaries
	Schedule 4.01(f)
	 	–	 	Material Litigation
	Schedule 4.01(n)
	 	–	 	Existing Debt
	Schedule 4.01(o)
	 	–	 	Surviving Debt
	Schedule 4.01(p)
	 	–	 	Existing Liens
	Schedule 4.01(q)
	 	 	 	 
	Part I
	 	–	 	Real Property
	Part II
	 	–	 	Management Agreements
	Schedule 4.01(r)
	 	–	 	Environmental Concerns
	Part I
	 	–	 	Non-compliance with Law
	Part II
	 	–	 	Storage Tanks, Asbestos, etc.
	Part III
	 	–	 	Remedial Action, etc.
	Part IV
	 	–	 	Site Assessments, etc.
	Schedule 4.01(x)
	 	–	 	Plans and Welfare Plans
	 
	 	 	 	 
	EXHIBITS
	 	 	 	 
	 
	 	 	 	 
	Exhibit A
	 	–	 	Form of Note
	Exhibit B
	 	–	 	Form of Notice of Borrowing
	Exhibit C
	 	–	 	Form of Guaranty Supplement
	Exhibit D
	 	–	 	Form of Assignment and Acceptance
	Exhibit E-1
	 	–	 	Form of Opinion of Greenberg Traurig LLP
	Exhibit E-2
	 	–	 	Form of Opinion of Bradley Arant Boult Cummings LLP
	Exhibit E-3
	 	–	 	Form of Opinion of Saul Ewing LLP
	Exhibit E-4
	 	–	 	Form of Opinion of Local Counsel for the Loan Parties
	Exhibit F
	 	–	 	Form of Security Agreement
	Exhibit G
	 	–	 	Form of Mortgage
	Exhibit H
	 	–	 	Form of Assignment of Leases
	Exhibit I
	 	–	 	Form of Borrowing Base Certificate
	Exhibit J
	 	–	 	Form of Hazardous Indemnity Agreement
	Exhibit K
	 	–	 	Form of Manager's Subordination
	Exhibit L
	 	–	 	Form of Pledge Agreement






iv









 





CREDIT AGREEMENT




          CREDIT AGREEMENT dated as of [_____________], 2010 (this “Agreement”) among Campus Crest
Communities Operating Partnership, LP, a Delaware limited partnership (the “Borrower”), Campus
Crest Communities, Inc., a Maryland corporation (the “Parent Guarantor”), the entities listed on
the signature pages hereof as the subsidiary guarantors (together with any Additional Guarantors
(as hereinafter defined) acceding hereto pursuant to Section 5.01(j) or 7.05, the “Subsidiary
Guarantors” and, together with the Parent Guarantor, the “Guarantors”), the banks, financial
institutions and other institutional lenders listed on the signature pages hereof as the initial
lenders (the “Initial Lenders”), the Swing Line Bank (as hereinafter defined), CITIBANK, N.A.
(“Citibank”), as the initial issuer of Letters of Credit (as hereinafter defined) (the “Initial
Issuing Bank”), CITIBANK, as administrative agent (together with any successor administrative agent
appointed pursuant to Article VIII, the “Administrative Agent”) for the Lender Parties (as
hereinafter defined), and CITIBANK, as collateral agent (together with any successor collateral
agent appointed pursuant to Article VIII, the “Collateral Agent”, and together with the
Administrative Agent, the “Agents”) for the Secured Parties (as hereinafter defined).




ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS




          SECTION 1.01. Certain Defined Terms. As used in this Agreement, the following terms shall have the following meanings (such
meanings to be equally applicable to both the singular and plural forms of the terms defined):





     “Acceding Lender” has the meaning specified in Section 2.17(d).




     “Accession Agreement” has the meaning specified in Section 2.17(d)(i).




     “Additional Guarantor” has the meaning specified in Section 7.05.




     “Adjusted EBITDA” means (a) EBITDA for the consecutive four fiscal quarters of the
Parent Guarantor most recently ended for which financial statements are required to be
delivered to the Lender Parties pursuant to Section 5.03(b) or (c), as the case may be, less
(b) the Capital Expenditure Reserve for all Assets for such four fiscal quarters, provided
that calculations which pertain to the fiscal quarters of the Parent Guarantor ending on or
prior to September 30, 2010 shall be made on a pro forma basis, including to give effect to
the IPO and the Formation Transactions.




     “Adjusted Net Operating Income” means, with respect to any Borrowing Base Asset, (a)
the Net Operating Income attributable to such Borrowing Base Asset less (b) the Capital
Expenditure Reserve for such Borrowing Base Asset, less (c) the Management Fee Adjustment
for such Borrowing Base Asset, in each case for the consecutive four fiscal quarters most
recently ended for which financial statements are required to be delivered to the Lender
Parties pursuant to Section 5.03(b) or (c), as the case may be.



 









 






     “Administrative Agent” has the meaning specified in the recital of parties to this
Agreement.




     “Administrative Agent’s Account” means the account of the Administrative Agent
maintained by the Administrative Agent with Citibank, N.A., at its office at 1615 Brett
Road, New Castle, Delaware 19720, ABA No. 021000089, Account No. 36852248, Account Name:
Agency/Medium Term Finance, Reference: Campus Crest Revolving Credit Facility, Attention:
Global Loans/Agency, or such other account as the Administrative Agent shall specify in
writing to the Lender Parties.




     “Advance” means a Revolving Credit Advance, a Swing Line Advance or a Letter of Credit
Advance.




     “Affiliate” means, as to any Person, any other Person that, directly or indirectly,
controls, is controlled by or is under common control with such Person or is a director or
officer of such Person. For purposes of this definition, the term “control” (including the
terms “controlling”, “controlled by” and “under common control with”) of a Person means the
possession, direct or indirect, of the power to vote 15% or more of the Voting Interests of
such Person or to direct or cause the direction of the management and policies of such
Person, whether through the ownership of Voting Interests, by contract or otherwise.




     “Affiliate Ground Lease” means a Ground Lease with respect to which the ground lessor
and ground lessee are Loan Parties.




     “Agents” has the meaning specified in the recital of parties to this Agreement.




     “Agreement” has the meaning specified in the recital of parties to this Agreement.




     “Agreement Value” means, for each Hedge Agreement, on any date of determination, an
amount determined by the Administrative Agent equal to: (a) in the case of a Hedge
Agreement documented pursuant to the Master Agreement (Multicurrency-Cross Border) published
by the International Swap and Derivatives Association, Inc. (the “Master Agreement”), the
amount, if any, that would be payable by any Loan Party or any of its Subsidiaries to its
counterparty to such Hedge Agreement, as if (i) such Hedge Agreement was being terminated
early on such date of determination, (ii) such Loan Party or Subsidiary was the sole
“Affected Party”, and (iii) the Administrative Agent was the sole party determining such
payment amount (with the Administrative Agent making such determination pursuant to the
provisions of the form of Master Agreement); or (b) in the case of a Hedge Agreement traded
on an exchange, the mark-to-market value of such Hedge Agreement, which will be the
unrealized loss on such Hedge Agreement to the Loan Party or Subsidiary of a Loan Party to
such Hedge Agreement determined by the Administrative Agent based on the settlement price of
such Hedge Agreement on such date of determination; or (c) in all other cases, the
mark-to-market value of such Hedge Agreement, which will be the unrealized loss on such
Hedge Agreement to the Loan Party or Subsidiary of a Loan Party to such Hedge Agreement
determined by the Administrative Agent as the amount, if any, by which (i) the present



2









 







value of the future cash flows to be paid by such Loan Party or Subsidiary exceeds (ii)
the present value of the future cash flows to be received by such Loan Party or Subsidiary
pursuant to such Hedge Agreement; capitalized terms used and not otherwise defined in this
definition shall have the respective meanings set forth in the above described Master
Agreement.




     “Applicable Lending Office” means, with respect to each Lender Party, such Lender
Party’s Domestic Lending Office in the case of a Base Rate Advance and such Lender Party’s
Eurodollar Lending Office in the case of a Eurodollar Rate Advance.




     “Applicable Margin” means, at any date of determination, a percentage per annum
determined by reference to the Leverage Ratio as set forth below:



	 	 	 	 	 	 	 
	 	 	 	 	Applicable Margin	 	Applicable Margin
	Pricing	 	 	 	for Base Rate	 	for Eurodollar
	Level	 	Leverage Ratio	 	Advances	 	Rate Advances
	I
	 	> 55%
	 	2.50%
	 	3.50%
	II
	 	> 50% but < 55%
	 	2.25%
	 	3.25%
	III
	 	> 45% but < 50%
	 	2.00%
	 	3.00%
	IV
	 	< 45%
	 	1.75%
	 	2.75%







The Applicable Margin for each Base Rate Advance shall be determined by reference to the
Leverage Ratio in effect from time to time, and the Applicable Margin for any Interest
Period for all Eurodollar Rate Advances comprising part of the same Borrowing shall be
determined by reference to the Leverage Ratio in effect on the first day of such Interest
Period; provided, however, that (a) the Applicable Margin shall initially be at Pricing
Level [__] on the Closing Date, (b) no change in the Applicable Margin resulting from the
Leverage Ratio shall be effective until three Business Days after the date on which the
Administrative Agent receives (i) the financial statements required to be delivered pursuant
to Section 5.03(b) or (c), as the case may be, and (ii) a certificate of the Chief Financial
Officer (or other Responsible Officer performing similar functions) of the Borrower
demonstrating the Leverage Ratio, and (c) the Applicable Margin shall be at Pricing Level I
for so long as the Borrower has not submitted to the Administrative Agent as and when
required under Section 5.03(b) or (c), as applicable, the information described in clause
(b) of this proviso.




     “Appraisal” means an appraisal complying with the requirements of the Federal Financial
Institutions Reform, Recovery and Enforcement Act of 1989, as amended from time to time,
commissioned by and prepared for the account of the Administrative Agent (for the benefit of
the Lenders) by a MAI appraiser selected by the Administrative Agent in consultation with
the Borrower, and otherwise in scope, form and substance satisfactory to the Collateral
Agent.




     “Appraised Value” means, as of any date of determination with respect to any Borrowing
Base Asset, the appraised value of such Borrowing Base Asset on an “as-is”



3









 







basis, in each
case as set forth in the most recent Appraisal of such Borrowing Base Asset delivered to the
Administrative Agent on or before such date of determination.




     “Approved Electronic Communications” means each Communication that any Loan Party is
obligated to, or otherwise chooses to, provide to the Administrative Agent pursuant to any
Loan Document or the transactions contemplated therein, including any financial statement,
financial and other report, notice, request, certificate and other information materials
required to be delivered pursuant to Sections 5.03(b), (c), (e), (g), and (k); provided,
however, that solely with respect to delivery of any such Communication by any Loan Party to
the Administrative Agent and without limiting or otherwise affecting either the
Administrative Agent’s right to effect delivery of such Communication by posting such
Communication to the Approved Electronic Platform or the protections afforded hereby to the
Administrative Agent in connection with any such posting, “Approved Electronic
Communication” shall exclude (i) any notice of borrowing, letter of credit request, swing
loan request, notice of conversion or continuation, and any other notice, demand,
communication, information, document and other material relating to a request for a new, or
a conversion of an existing, Borrowing, (ii) any notice pursuant to Section 2.06(a) and any
other notice relating to the payment of any principal or other amount due under any Loan
Document prior to the scheduled date therefor, (iii) all notices of any Default or Event of
Default and (iv) any notice, demand, communication, information, document and other material
required to be delivered to satisfy any of the conditions set forth in Article III or any
other condition to any Borrowing or other extension of credit hereunder or any condition
precedent to the effectiveness of this Agreement.




     “Approved Electronic Platform” has the meaning specified in Section 9.02(c).




     “Approved Manager” means with respect to any Campus Housing Asset (i) an affiliate of
the Parent Guarantor, or (ii) a nationally recognized campus housing manager (a) with (or
controlled by a Person or Persons with) at least ten years of experience in the campus
housing management industry, (b) that is engaged pursuant to a written management agreement
in form and substance reasonably satisfactory to the Administrative Agent and (c) that has
entered into a subordination agreement in form and substance reasonably satisfactory to the
Administrative Agent. The Administrative Agent confirms that as of the Closing Date the
existing manager of the Campus Housing Assets shown on Part III of Schedule 4.01(q) hereto
is satisfactory to the Administrative Agent. For purposes of this definition, the term
“control” (including the term “controlled by”) of a Person means the possession, direct or
indirect, of the power to direct or cause the direction of the management and policies of
such Person, whether through the ownership of Voting Interests, by contract or otherwise.




     “Arrangers” means, collectively, CGMI and Raymond James Bank FSB, each as joint lead
arranger and joint book running manager.




     “Assets” means Campus Housing Assets, Development Assets and Joint Venture Assets.



4









 






     “Asset Value” means, at any date of determination, (a) in the case of any Campus
Housing Asset where the related certificate of occupancy was issued twelve or more months
prior to such date of determination, (i) the Net Operating Income attributable to such Asset
less the Management Fee Adjustment for such Asset, in each case for the consecutive four
fiscal quarters most recently ended for which financial statements are required to be
delivered to the Lender Parties pursuant to Section 5.03(b) or (c), as the case may be
divided by (ii) 8.25%, (b) in the case of any Development Asset and any Campus Housing Asset
where the related certificate of occupancy was issued less than twelve months prior to such
date of determination, the book value of such Development Asset or such Campus Housing Asset
as determined in accordance with GAAP (but excluding any deduction for accumulated
depreciation on such Assets), (c) in the case of any Joint Venture Asset that, but for such
Asset being owned by a Joint Venture, would qualify as a Campus Housing Asset under the
definition thereof where the related certificate of occupancy was issued twelve or more
months prior to such date of determination, the JV Pro Rata Share of (i) the Net Operating
Income attributable to such Asset less the Management Fee Adjustment for such Asset, in each
case for the consecutive four fiscal quarters most recently ended for which financial
statements are required to be delivered to the Lender Parties pursuant to Section 5.03(b) or
(c), as the case may be divided by (ii) 8.25% and (d) in the case of any other Joint Venture
Asset, the JV Pro Rata Share of the book value of such Joint Venture Asset as determined in
accordance with GAAP (but excluding any deduction for accumulated depreciation on such
Assets).




     “Assignment and Acceptance” means an assignment and acceptance entered into by a Lender
Party and an Eligible Assignee, and accepted by the Administrative Agent, in accordance with
Section 9.07 and in substantially the form of Exhibit D hereto.




     “Assignments of Leases” has the meaning specified in Section 3.01(a)(iii).




     “Available Amount” of any Letter of Credit means, at any time, the maximum amount
available to be drawn under such Letter of Credit at such time (assuming compliance at such
time with all conditions to drawing).




     “Bankruptcy Law” means any applicable law governing a proceeding of the type referred
to in Section 6.01(f) or Title 11, U.S. Code, or any similar foreign, federal or state law
for the relief of debtors.




     “Base Rate” means a fluctuating interest rate per annum in effect from time to time,
which rate per annum shall at all times be equal to the highest of (a) the rate of interest
announced publicly by Citibank, N.A. in New York, New York, from time to time, as Citibank,
N.A.’s base rate, (b) 1/2 of 1% per annum above the Federal Funds Rate and (c) the one-month
Eurodollar Rate plus 1% per annum.




     “Base Rate Advance” means an Advance that bears interest as provided in Section
2.07(a)(i).



5









 






     “BBA Proposal Package” means, with respect to any Proposed Borrowing Base Asset, the
following items, each in form and substance satisfactory to the Administrative Agent and in
sufficient copies for each Lender:




     (a) a description of such Asset in detail satisfactory to the Administrative Agent,




     (b) a projected cash flow analysis of such Asset prepared in a form reasonably
acceptable to the Administrative Agent,




     (c) a statement of operating expenses for such Asset for the immediately preceding 36
consecutive calendar months (or, if not in operation for 36 consecutive calendar months, the
total period of operations),




     (d) an operating expense and capital expenditures budget for such Asset for the next
succeeding 12 consecutive months,




     (e) a current rent roll, and




     (f) if such Asset is then the subject of an acquisition transaction, a copy of the
purchase agreement with respect thereto and a schedule of the proposed sources and uses of
funds for such transaction.




     “Borrower” has the meaning specified in the recital of parties to this Agreement.




     “Borrower’s Account” means the account of the Borrower maintained by the Borrower with
[_____________] at its office at [_____________], ABA No. [_____________], Account No.
[_____________] or such other account as the Borrower shall specify in writing to the
Administrative Agent.




     “Borrowing” means a borrowing consisting of simultaneous Revolving Credit Advances of
the same Type made by the Lenders or a Swing Line Borrowing.




     “Borrowing Base Assets” means (a) those Campus Housing Assets for which the applicable
conditions (as may be determined by the Administrative Agent in its sole discretion) in
Section 3.01 and, if applicable, Section 5.01(k) have been satisfied and as the
Administrative Agent and the Required Lenders, in their sole discretion, shall have elected
to treat as Borrowing Base Assets for purposes of this Agreement, and (b) the Campus Housing
Assets listed on Schedule II hereto on the Closing Date.




     “Borrowing Base Certificate” means a certificate in substantially the form of Exhibit I
hereto, duly certified by the Chief Financial Officer (or other Responsible Officer
performing similar functions) of the Parent Guarantor.




     “Borrowing Base Conditions” means, with respect to any Proposed Borrowing Base Asset,
that such Proposed Borrowing Base Asset



6









 






     (a) is a Campus Housing Asset located in one of the 48 contiguous states of the United
States of America or the District of Columbia that has been in operation for at least one
year;




     (b) is wholly-owned directly or indirectly by the Borrower either in fee simple
absolute or subject to a Qualifying Ground Lease;




     (c) is fully operating and not under significant development or redevelopment;




     (d) is free of all material structural defects or architectural deficiencies, title
defects, environmental or other material matters (including a casualty event or
condemnation) that could reasonably be expected to have a material adverse effect on the
value, use or ability to sell or refinance such Asset;




     (e) is operated by an Approved Manager or any other property manager approved by the
Administrative Agent;




     (f) is not subject to mezzanine Debt financing;




     (g) is not, and no interest of the Borrower or any of its Subsidiaries therein is,
subject to any Lien (other than Permitted Liens) or any Negative Pledge; and




     (h) is 100% owned by a Loan Party that is a single-purpose Subsidiary of the Borrower
and (1) none of the Borrower’s or the Parent Guarantor’s direct or indirect Equity Interests
in such Subsidiary is subject to any Lien (other than Permitted Liens) or any Negative
Pledge and (2)(x) on or prior to the date such Asset is added to the Collateral, such
Subsidiary shall have become a Guarantor hereunder, and (y) 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: (i) to create Liens on such Asset and on the
Equity Interests in such Subsidiary as security for Debt of the Borrower or such Subsidiary,
as applicable, and (ii) to sell, transfer or otherwise dispose of such Asset.




     “Borrowing Base Debt Service Coverage Ratio” means, at any date of determination, the
ratio of (a) the aggregate Adjusted Net Operating Income for all Borrowing Base Assets to
(b) the payments that would be required to be made over a twelve month period on an assumed
Debt in an aggregate principal amount equal to the Facility Exposure at such date, assuming
a thirty year amortization schedule, level payments of interest and applying an interest
rate equal to the greater of (i) 7.50% per annum and (ii) the rate per annum at such date
for 10-year United States Treasury Securities plus the Applicable Margin in respect of
Eurodollar Rate Advances.




     “Borrowing Base Value” means, with respect to any Borrowing Base Asset, an amount equal
to 60% of the Appraised Value of such Borrowing Base Asset.




     “Business Day” means a day of the year on which banks are not required or authorized by
law to close in New York City and, if the applicable Business Day relates



7









 







to any Eurodollar
Rate Advances, on which dealings are carried on in the London interbank market.




     “Campus Housing Asset” means Real Property that operates or is intended to be operated
as student housing, but excluding any Joint Venture Asset.




     “Capital Expenditure Reserve” means, with respect to any Campus Housing Asset at any
date of determination, $125 times the number of beds comprising such Asset.




     “Capitalized Leases” means all leases that have been or should be, in accordance with
GAAP, recorded as capitalized leases.




     “Cash” means coin or currency of the United States of America or immediately available
federal funds, including such funds delivered by wire transfer.




     “Cash Collateralize” means to pledge and deposit with or deliver to the Administrative
Agent, for the benefit of the Administrative Agent and the Issuing Bank (as applicable), as
collateral for the Available Amount of any Letter of Credit, cash or deposit account
balances or, if the Issuing Bank benefitting from such collateral shall agree in its sole
discretion, other credit support, in each case pursuant to documentation in form and
substance satisfactory to (a) the Administrative Agent and (b) the Issuing Bank. “Cash
Collateral” shall have a meaning correlative to the foregoing and shall include the proceeds
of such cash collateral and other credit support.




     “Cash Equivalents” means any of the following, to the extent owned by the applicable
Loan Party or any of its Subsidiaries free and clear of all Liens (other than Liens created
under the Collateral Documents) and having a maturity of not greater than 90 days from the
date of issuance thereof: (a) readily marketable direct obligations of the Government of
the United States or any agency or instrumentality thereof or obligations unconditionally
guaranteed by the full faith and credit of the Government of the United States, (b)
certificates of deposit of or time deposits with any commercial bank that is a Lender Party
or a member of the Federal Reserve System, issues (or the parent of which issues) commercial
paper rated as described in clause (c) below, is organized under the laws of the United
States or any State thereof and has combined capital and surplus of at least $1,000,000,000
or (c) commercial paper in an aggregate amount of not more than $50,000,000 per issuer
outstanding at any time, issued by any corporation organized under the laws of any State of
the United States and rated at least “Prime-1” (or the then equivalent grade) by Moody’s or
“A-1” (or the then equivalent grade) by S&P.




     “CERCLA” means the Comprehensive Environmental Response, Compensation and Liability Act
of 1980, as amended from time to time.




     “CERCLIS” means the Comprehensive Environmental Response, Compensation and Liability
Information System maintained by the U.S. Environmental Protection Agency.




     “CGMI” means Citigroup Global Markets Inc.



8









 






     “Change of Control” means the occurrence of any of the following (after giving effect
to the consummation of the IPO and the Formation Transactions):




     (a) any Person or two or more Persons acting in concert shall have acquired and shall
continue to have following the date hereof beneficial ownership (within the meaning of Rule
13d-3 of the Securities and Exchange Commission under the Securities Exchange Act of 1934),
directly or indirectly, of Voting Interests of the Parent Guarantor (or other securities
convertible into such Voting Interests) representing 35% or more of the combined voting
power of all Voting Interests of the Parent Guarantor; or




     (b) there is a change in the composition of the Parent Guarantor’s Board of Directors
over a period of 24 consecutive months (or less) such that a majority of Board members
(rounded up to the nearest whole number) ceases, by reason of one or more proxy contests for
the election of Board members, to be comprised of individuals who either (i) have been
Board members continuously since the beginning of such period or (ii) have been elected or
nominated for election as Board members during such period by at least a majority of the
Board members described in clause (i) who were still in office at the time such election or
nomination was approved by the Board; or




     (c) any Person or two or more Persons acting in concert shall have acquired and shall
continue to have following the date hereof, by contract or otherwise, or shall have entered
into a contract or arrangement that, upon consummation will result in its or their
acquisition of the power to direct, directly or indirectly, the management or policies of
the Parent Guarantor; or




     (d) the Parent Guarantor ceases to be (i) the indirect legal and beneficial owner of
all of the general partnership interests in the Borrower, (ii) the direct legal and
beneficial owner of all of the membership interests in Campus Crest Communities GP, LLC or
(iii) the direct or indirect legal and beneficial owner of not less than 75% of the limited
partnership interests in the Borrower; or




     (e) Campus Crest Communities GP, LLC ceases to be the general partner of the Borrower;
or




     (f) the Parent Guarantor or Campus Crest Communities GP, LLC shall create, incur,
assume or suffer to exist any Lien on the Equity Interests in Campus Crest Communities GP,
LLC or the Borrower owned by it; or




     (g) the Borrower ceases to be the direct or indirect legal and beneficial owner of all
of the Equity Interests in each direct and indirect Subsidiary that owns or leases a
Borrowing Base Asset.




     “Citibank” has the meaning specified in the recital of the parties to this Agreement.




     “Closing Date” means [_________] or such other date as may be agreed upon by the
Borrower and the Administrative Agent.



9









 






     “Collateral” means all “Collateral” and all “Mortgaged Property” referred to in the
Collateral Documents and all other property that is or is intended to be subject to any Lien
in favor of the Collateral Agent for the benefit of the Secured Parties and includes,
without limitation, all Borrowing Base Assets.




     “Collateral Agent” has the meaning specified in the recital of parties to this
Agreement.




     “Collateral Documents” means the Security Agreement, the Pledge Agreement, the
Mortgages, the Assignments of Leases and any other agreement entered into by a Loan Party
that creates or purports to create a Lien in favor of the Collateral Agent for the benefit
of the Secured Parties.




     “Collateral Deliverables” means, with respect to any Proposed Borrowing Base Asset, the
following items, each in form and substance satisfactory to the Administrative Agent (unless
otherwise specified) and in sufficient copies for each Lender:




     (i) A certificate of the Chief Financial Officer (or other Responsible Officer)
of the Borrower, dated the date of the addition of such Proposed Borrowing Base
Asset to the Collateral as a Borrowing Base Asset, confirming that (A) the Proposed
Borrowing Base Asset satisfies all Borrowing Base Conditions, (B) no Default or
Event of Default has occurred or is continuing, and the addition of such Proposed
Borrowing Base Asset as a Borrowing Base Asset shall not cause or result in a
Default or Event of Default, (C) the representations and warranties contained in the
Loan Documents are true and correct in all material respects (or, if qualified as to
materiality, in all respects) on and as of such date (except to the extent that such
representations and warranties specifically refer to an earlier date, in which case
they are true and correct as of such earlier date), and (D) the Loan Parties are in
compliance with the covenants contained in Section 5.04 (both immediately before and
on a pro forma basis immediately after the addition of such Proposed Borrowing Base
Property as a Borrowing Base Asset), together with supporting information
demonstrating such compliance;




     (ii) A Borrowing Base Certificate demonstrating that the Total Borrowing Base
Value (calculated on a pro forma basis after giving effect to the addition of such
Proposed Borrowing Base Asset to the Collateral as a Borrowing Base Asset and to any
Advances made at the time thereof) will be greater than or equal to the Facility
Exposure;




     (iii) each of the items set forth in Sections 3.01(a)(ii), (iii), (v), (vi),
(vii), (viii), (ix), (xi), (xiii), (xv) and, to the extent applicable, 5.01(j),
mutatis mutandis, in each case in respect of such Proposed Borrowing Base Asset or
the
Loan Party or proposed Loan Party which owns such Proposed Borrowing Base
Asset;




     (iv) An Appraisal of such Proposed Borrowing Base Asset;



10









 






     (v) Reports supplementing Schedules II, 4.01(b), 4.01(q) and 4.01(r) hereto,
including descriptions of such changes in the information included in such Schedules
as may be necessary for such Schedules to be accurate and complete, certified as
correct and complete by a Responsible Officer of the Borrower, provided that for
purposes of the definition of the term Borrowing Base Assets, the supplement to
Schedule II shall become effective only upon (A) delivery of all Collateral
Deliverables and approval thereof by the Administrative Agent, and (B) approval of
the Proposed Borrowing Base Asset as a Borrowing Base Asset pursuant to the
definition of “Borrowing Base Assets”; and




     (vi) Such other approvals, opinions or documents as any Lender Party through
the Administrative Agent may reasonably request.




     “Commitment” means a Revolving Credit Commitment, a Swing Line Commitment or a Letter
of Credit Commitment.




     “Commitment Date” has the meaning specified in Section 2.17(b).




     “Commitment Increase” has the meaning specified in Section 2.17(a).




     “Communications” means each notice, demand, communication, information, document and
other material provided for hereunder or under any other Loan Document or otherwise
transmitted between the parties hereto relating to this Agreement, the other Loan Documents,
any Loan Party or its Affiliates, or the transactions contemplated by this Agreement or the
other Loan Documents including, without limitation, all Approved Electronic Communications.




     “Conditional Approval Notice” has the meaning specified in Section 5.01(k).




     “Consolidated” refers to the consolidation of accounts in accordance with GAAP.




     “Contingent Obligation” means, with respect to any Person, any Obligation or
arrangement of such Person to guarantee or intended to guarantee any Debt, leases, dividends
or other payment Obligations (“primary obligations”) of any other Person (the “primary
obligor”) in any manner, whether directly or indirectly, including, without limitation, (a)
the direct or indirect guarantee, endorsement (other than for collection or deposit in the
ordinary course of business), co making, discounting with recourse or sale with recourse by
such Person of the Obligation of a primary obligor, (b) the Obligation to make take-or-pay
or similar payments, if required, regardless of nonperformance by any other party or parties
to an agreement or (c) any Obligation of such Person, whether or not contingent, (i) to
purchase any such primary obligation or any property constituting direct or indirect
security therefor, (ii) to advance or supply funds (A) for the purchase or payment of any
such primary obligation or (B) to maintain working capital or equity
capital of the primary obligor or otherwise to maintain the net worth or solvency of
the primary obligor, (iii) to purchase property, assets, securities or services primarily
for the purpose of assuring the owner of any such primary obligation of the ability of the
primary obligor to make payment of such primary obligation or (iv) otherwise to assure or
hold harmless the holder of such primary obligation against loss in respect thereof. The



11









 







amount of any Contingent Obligation shall be deemed to be an amount equal to the stated or
determinable amount of the primary obligation in respect of which such Contingent Obligation
is made (or, if less, the maximum amount of such primary obligation for which such Person
may be liable pursuant to the terms of the instrument evidencing such Contingent Obligation)
or, if not stated or determinable, the maximum reasonably anticipated liability in respect
thereof (assuming such Person is required to perform thereunder), as determined by such
Person in good faith.




     “Conversion”, “Convert” and “Converted” each refer to a conversion of Advances of one
Type into Advances of the other Type pursuant to Section 2.07(d), 2.09 or 2.10.




     “Current Party” has the meaning specified in Section 9.07(k).




     “Customary Carve-Out Agreement” has the meaning specified in the definition of
Non-Recourse Debt.




     “Debt” of any Person means, without duplication for purposes of calculating financial
ratios, (a) all Debt for Borrowed Money of such Person, (b) all Obligations of such Person
for the deferred purchase price of property or services other than trade payables incurred
in the ordinary course of business and not overdue by more than 60 days, (c) all Obligations
of such Person evidenced by notes, bonds, debentures or other similar instruments, (d) all
Obligations of such Person created or arising under any conditional sale or other title
retention agreement with respect to property acquired by such Person (even though the rights
and remedies of the seller or lender under such agreement in the event of default are
limited to repossession or sale of such property), (e) all Obligations of such Person as
lessee under Capitalized Leases, (f) all Obligations of such Person under acceptance, letter
of credit or similar facilities, (g) all Obligations of such Person to purchase, redeem,
retire, defease or otherwise make any payment in respect of any Equity Interests in such
Person or any other Person (other than Preferred Interests that are issued by any Loan Party
or Subsidiary thereof and classified as either equity or minority interests pursuant to
GAAP) or any warrants, rights or options to acquire such Equity Interests, (h) all
Obligations of such Person in respect of Hedge Agreements, valued at the Agreement Value
thereof, (i) all Contingent Obligations of such Person and (j) all indebtedness and other
payment Obligations referred to in clauses (a) through (i) above of another Person secured
by (or for which the holder of such Debt has an existing right, contingent or otherwise, to
be secured by) any Lien on property (including, without limitation, accounts and contract
rights) owned by such Person, even though such Person has not assumed or become liable for
the payment of such indebtedness or other payment Obligations; provided, however, that in
the case of the Parent Guarantor and its Subsidiaries, “Debt” shall also include, without
duplication, the JV Pro Rata Share of Debt for each Joint Venture.




     “Debt for Borrowed Money” of any Person means all items that, in accordance with GAAP,
would be classified as indebtedness on a Consolidated balance sheet of such Person;
provided, however, that in the case of the Parent Guarantor and its Subsidiaries “Debt for
Borrowed Money” shall also include, without duplication, the JV Pro Rata



12









 







Share of Debt for
Borrowed Money for each Joint Venture; provided further that as used in the definition of
“Fixed Charge Coverage Ratio”, in the case of any acquisition or disposition of any direct
or indirect interest in any Asset (including through the acquisition or disposition of
Equity Interests) by the Parent Guarantor or any of its Subsidiaries during the consecutive
four fiscal quarters of the Parent Guarantor most recently ended for which financial
statements are required to be delivered to the Lender Parties pursuant to Section 5.03(b) or
(c), as the case may be, the term “Debt for Borrowed Money” (a) shall include, in the case
of an acquisition, any Debt for Borrowed Money directly relating to such Asset existing
immediately following such acquisition computed as if such indebtedness also existed for the
portion of such period that such Asset was not owned by the Parent Guarantor or such
Subsidiary, and (b) shall exclude, in the case of a disposition, for such period any Debt
for Borrowed Money to which such Asset was subject to the extent such Debt for Borrowed
Money was repaid or otherwise terminated upon the disposition of such Asset.




     “Default” means any Event of Default or any event that would constitute an Event of
Default but for the requirement that notice be given or time elapse or both.




     “Development Assets” means all Real Property acquired for development into Campus
Housing Assets that, in accordance with GAAP, would be classified as development property on
a Consolidated balance sheet of the Parent Guarantor and its Subsidiaries.




     “Dividend Payout Ratio” means, at any date of determination, the ratio, expressed as a
percentage, of (a) the sum, without duplication, of all dividends paid by the Parent
Guarantor on account of any common stock or preferred stock of Parent Guarantor, except
dividends payable solely in additional Equity Interests of the same class, to (b) Funds From
Operations, in each case for the four consecutive fiscal quarters of the Parent Guarantor
most recently ended (or, in the case of the first, second or third fiscal quarter of the
Parent Guarantor for which financial statements are required to be delivered to the Lender
Parties pursuant to Section 5.03(b) or (c), as the case may be, one, two or three
consecutive fiscal quarters, respectively).




     “Domestic Lending Office” means, with respect to any Lender Party, the office of such
Lender Party specified as its “Domestic Lending Office” opposite its name on Schedule I
hereto or in the Assignment and Acceptance pursuant to which it became a Lender Party, as
the case may be, or such other office of such Lender Party as such Lender Party may from
time to time specify to the Borrower and the Administrative Agent.




     “EBITDA” means, at any date of determination, the sum of the following items, in each
case for the four consecutive fiscal quarters of the Parent Guarantor most recently ended:
(a) the sum of (i) net income (or net loss) (excluding gains (or losses) from
extraordinary, infrequent, and unusual items), (ii) interest expense, (iii) income tax
expense, (iv) depreciation expense, (v) amortization expense, and (vi) to the extent
subtracted in computing net income, expenses incurred in connection with the Formation
Transactions and the IPO and other non-recurring items, in each case of the Parent 


13









 







Guarantor
and its Subsidiaries determined on a Consolidated basis and in accordance with GAAP for such
four fiscal quarter period, less, to the extent not already deducted, all rentals payable
under leases of real or personal (or mixed) property, in each case, of or by the Parent
 Guarantor and its Subsidiaries for the consecutive four fiscal quarters of the Parent
Guarantor most recently ended for which financial statements are required to be delivered to
the Lender Parties pursuant to Section 5.03(b) or (c), as the case may be, plus (b) with
respect to each Joint Venture, the JV Pro Rata Share of the sum of (i) net income (or net
loss) (excluding gains (or losses) from extraordinary and unusual items), (ii) interest
expense, (iii) income tax expense, (iv) depreciation expense, (v) amortization expense, and
(vi) to the extent subtracted in computing net income of such Joint Venture, non-recurring
items, in each case of such Joint Venture determined on a Consolidated basis and in
accordance with GAAP for such four fiscal quarter period, less, to the extent not already
deducted, all rentals payable under leases of real or personal (or mixed) property, in each
case, of or by the Parent Guarantor and its Subsidiaries for the consecutive four fiscal
quarters of the Parent Guarantor most recently ended for which financial statements are
required to be delivered to the Lender Parties pursuant to Section 5.03(b) or (c), as the
case may be; provided, however, that for purposes of this definition, in the case of any
acquisition or disposition of any direct or indirect interest in any Asset (including
through the acquisition or disposition of Equity Interests) by the Parent Guarantor or any
of its Subsidiaries during such four fiscal quarter period, EBITDA will be adjusted (1) in
the case of an acquisition, by adding thereto an amount equal to the acquired Asset’s actual
EBITDA (computed as if such Asset was owned by the Parent Guarantor or one of its
Subsidiaries for the entire four fiscal quarter period) generated during the portion of such
four fiscal quarter period that such Asset was not owned by the Parent Guarantor or such
Subsidiary, and (2) in the case of a disposition, by subtracting therefrom an amount equal
to the actual EBITDA generated by the Asset so disposed of during such four fiscal quarter
period; provided further that calculations which pertain to the fiscal quarters of the
Parent Guarantor ending on or prior to September 30, 2010 shall be made on a pro forma
basis, including to give effect to the IPO and the Formation Transactions.




     “Effective Date” means the first date on which the conditions set forth in Article III
shall be satisfied.




     “Eligible Assignee” means (a) with respect to the Revolving Credit Facility, (i) a
Lender; (ii) an Affiliate or Fund Affiliate of a Lender; (iii) if at the time an assignment
is effected pursuant to Section 9.07 a Default has occurred and is continuing, then any of
(A) a commercial bank organized under the laws of the United States, or any State thereof,
respectively, and having total assets in excess of $500,000,000; (B) a savings and loan
association or savings bank organized under the laws of the United States or any State
thereof, and having total assets in excess of $500,000,000; (C) a commercial bank organized
under the laws of any other country that is a member of the OECD or has concluded special
lending arrangements with the International Monetary Fund associated
with its General Arrangements to Borrow, or a political subdivision of any such
country, and having total assets in excess of $500,000,000, so long as such bank is acting
through a branch or agency located in the United States; (D) the central bank of any country
that is a member of the OECD; or (E) a finance company, insurance company or other



14









 







financial
institution or fund (whether a corporation, partnership, trust or other entity) that is
engaged in making, purchasing or otherwise investing in commercial loans in the ordinary
course of its business and having total assets in excess of $500,000,000; and (iv) any other
Person approved by the Administrative Agent, and, unless a Default has occurred and is
continuing at the time any assignment is effected pursuant to Section 9.07, approved by the
Borrower, each such approval not to be unreasonably withheld or delayed, and (b) with
respect to the Letter of Credit Facility, a Person of the type described under subclause
(iii)(A) or (C) of this definition that is approved by the Administrative Agent and, unless
a Default has occurred and is continuing at the time any assignment is effected pursuant to
Section 9.07, approved by the Borrower, each such approval not to be unreasonably withheld
or delayed; provided, however, that neither any Loan Party nor any Affiliate of a Loan Party
shall qualify as an Eligible Assignee under this definition; and provided further that if
Borrower does not disapprove a potential Eligible Assignee in writing within five (5)
Business Days after such request for approval, then Borrower’s approval hereunder shall be
deemed given.




     “Environmental Action” means any enforcement action, suit, demand, demand letter, claim
of liability, notice of non-compliance or violation, notice of liability or potential
liability, investigation, enforcement proceeding, consent order or consent agreement
relating in any way to any Environmental Law, any Environmental Permit or Hazardous Material
or arising from alleged injury or threat to health, safety or the environment, including,
without limitation, (a) by any governmental or regulatory authority for enforcement,
cleanup, removal, response, remedial or other actions or damages and (b) by any governmental
or regulatory authority or third party for damages, contribution, indemnification, cost
recovery, compensation or injunctive relief.




     “Environmental Law” means any Federal, state, local or foreign statute, law, ordinance,
rule, regulation, code, order, writ, judgment, injunction, decree or judicial or agency
interpretation, policy or guidance relating to pollution or protection of the environment,
health, safety or natural resources, including, without limitation, those relating to the
use, handling, transportation, treatment, storage, disposal, release or discharge of
Hazardous Materials.




     “Environmental Permit” means any permit, approval, identification number, license or
other authorization required under any Environmental Law.




     “E013224” has the meaning specified in Section 4.01(aa).




     “Equity Interests” means, with respect to any Person, shares of capital stock of (or
other ownership or profit interests in) such Person, warrants, options or other rights for
the purchase or other acquisition from such Person of shares of capital stock of (or other
ownership or profit interests in) such Person, securities convertible into or exchangeable
for shares of capital stock of (or other ownership or profit interests in) such
Person or warrants, rights or options for the purchase or other acquisition from such
Person of such shares (or such other interests), and other ownership or profit interests in
such Person (including, without limitation, partnership, member or trust interests therein),



15









 







whether voting or nonvoting, and whether or not such shares, warrants, options, rights or
other interests are authorized or otherwise existing on any date of determination.




     “ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time
to time, and the regulations promulgated and rulings issued thereunder.




     “ERISA Affiliate” means any Person that for purposes of Title IV of ERISA is a member
of the controlled group of any Loan Party, or under common control with any Loan Party,
within the meaning of Section 414 of the Internal Revenue Code.




     “ERISA Event” means (a)(i) the occurrence of a reportable event, within the meaning of
Section 4043 of ERISA, with respect to any Plan unless the 30 day notice requirement with
respect to such event has been waived by the PBGC or (ii) the requirements of Section
4043(b) of ERISA apply with respect to a contributing sponsor, as defined in Section
4001(a)(13) of ERISA, of a Plan, and an event described in paragraph (9), (10), (11), (12)
or (13) of Section 4043(c) of ERISA is reasonably expected to occur with respect to such
Plan within the following 30 days; (b) the application for a minimum funding waiver with
respect to a Plan; (c) the provision by the administrator of any Plan of a notice of intent
to terminate such Plan pursuant to Section 4041(a)(2) of ERISA (including any such notice
with respect to a plan amendment referred to in Section 4041(e) of ERISA); (d) the cessation
of operations at a facility of any Loan Party or any ERISA Affiliate in the circumstances
described in Section 4062(e) of ERISA; (e) the withdrawal by any Loan Party or any ERISA
Affiliate from a Multiple Employer Plan during a plan year for which it was a substantial
employer, as defined in Section 4001(a)(2) of ERISA; (f) the conditions for imposition of a
lien under Section 303(k) of ERISA shall have been met with respect to any Plan; or (g) the
institution by the PBGC of proceedings to terminate a Plan pursuant to Section 4042 of
ERISA, or the occurrence of any event or condition described in Section 4042 of ERISA that
constitutes grounds for the termination of, or the appointment of a trustee to administer,
such Plan.




     “Eurocurrency Liabilities” has the meaning specified in Regulation D of the Board of
Governors of the Federal Reserve System, as in effect from time to time.




     “Eurodollar Lending Office” means, with respect to any Lender Party, the office of such
Lender Party specified as its “Eurodollar Lending Office” opposite its name on Schedule I
hereto or in the Assignment and Acceptance pursuant to which it became a Lender Party (or,
if no such office is specified, its Domestic Lending Office), or such other office of such
Lender Party as such Lender Party may from time to time specify to the Borrower and the
Administrative Agent.




     “Eurodollar Rate” means, for any Interest Period for all Eurodollar Rate Advances
comprising part of the same Borrowing, an interest rate per annum equal to the rate per
annum obtained by dividing (a) the rate per annum (rounded upward, if
necessary, to the nearest 1/100 of 1%) determined by the Administrative Agent to be the
offered rate that appears on the Reuters Screen LIBOR01 Page (or any successor thereto)



16









 







as
the British Bankers Association London interbank offered rate for deposits in U.S. Dollars
(for delivery on the first day of such Interest Period) with a term equivalent to such
Interest Period, determined as of approximately 11:00 A.M. (London time) two Business Days
prior to the first day of such Interest Period, or, if for any reason such rate is not
available, the average (rounded upward, if necessary, to the nearest 1/100 of 1%, if such
average is not such a multiple) of the rate per annum at which deposits in U.S. dollars are
offered by the principal office of the Reference Bank in London, England to prime banks in
the London interbank market at 11:00 A.M. (London time) two Business Days before the first
day of such Interest Period in an amount substantially equal to such Reference Bank’s
Eurodollar Rate Advance comprising part of such Borrowing to be outstanding during such
Interest Period (or, if such Reference Bank shall not have such a Eurodollar Rate Advance,
$1,000,000) and for a period equal to such Interest Period by (b) a percentage equal to 100%
minus the Eurodollar Rate Reserve Percentage for such Interest Period.




     “Eurodollar Rate Advance” means an Advance that bears interest as provided in Section
2.07(a)(ii).




     “Eurodollar Rate Reserve Percentage” means, for any Interest Period for all Eurodollar
Rate Advances comprising part of the same Borrowing, the reserve percentage applicable two
Business Days before the first day of such Interest Period under regulations issued from
time to time by the Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement (including, without limitation, any emergency,
supplemental or other marginal reserve requirement) for a member bank of the Federal Reserve
System in New York City with respect to liabilities or assets consisting of or including
Eurocurrency Liabilities (or with respect to any other category of liabilities that includes
deposits by reference to which the interest rate on Eurodollar Rate Advances is determined)
having a term equal to such Interest Period.




     “Events of Default” has the meaning specified in Section 6.01.




     “Existing Debt” means Debt of each Loan Party and its Subsidiaries outstanding
immediately before giving effect to the Formation Transactions.




     “Excluded Recourse Properties” means the Real Property listed on Schedule III hereto on
the Closing Date.




     “Extension Date” has the meaning specified in Section 2.16.




     “Facility” means the Revolving Credit Facility, the Swing Line Facility or the Letter
of Credit Facility.




     “Facility Exposure” means, at any date of determination, the sum of (a) the aggregate
principal amount of all outstanding Advances, plus (b) the amount (not less than zero) equal
to the Available Amount under all outstanding Letters of Credit less all
amounts then on deposit in the L/C Cash Collateral Account, plus (c) all Obligations of



17









 







the Loan Parties in respect of Secured Hedge Agreements, valued at the Agreement Value
thereof.




     “Federal Funds Rate” means, for any period, a fluctuating interest rate per annum equal
for each day during such period to the weighted average of the rates on overnight Federal
funds transactions with members of the Federal Reserve System arranged by Federal funds
brokers, as published for such day (or, if such day is not a Business Day, for the next
preceding Business Day) by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day that is a Business Day, the average of the quotations for such day for
such transactions received by the Administrative Agent from three Federal funds brokers of
recognized standing selected by it.




     “Fee Letter” means the fee letter dated as of August 2, 2010 among Borrower, Parent
Guarantor, Campus Crest Group, LLC, the Subsidiary Guarantors and CGMI, as the same may be
amended from time to time.




     “Fiscal Year” means a fiscal year of the Parent Guarantor and its Consolidated
Subsidiaries ending on December 31 in any calendar year.




     “Fixed Charge Coverage Ratio” means, at any date of determination, the ratio of (a)
Adjusted EBITDA to (b) the sum of (i) interest (including capitalized interest (but
excluding capitalized interest with respect to construction financing of Real Property prior
to the issuance of the related certificate of occupancy)) payable on, and amortization of
debt discount in respect of, all Debt for Borrowed Money plus (ii) scheduled amortization of
principal amounts of all Debt for Borrowed Money payable (excluding maturities) plus (iii)
cash dividends payable on any Preferred Interests; provided, however, that calculations
which pertain to the fiscal quarters of the Parent Guarantor ending on or prior to September
30, 2010 shall be made on a pro forma basis, including to give effect to the IPO and the
Formation Transactions.




     “Formation Transactions” means the “formation transactions” all as more fully described
in the Registration Statement and otherwise on terms reasonably satisfactory to the
Administrative Agent.




     “Fund Affiliate” means, with respect to any Lender that is a fund that invests in bank
loans, any other fund that invests in bank loans and is advised or managed by the same
investment advisor as such Lender or by an Affiliate of such investment advisor.




     “Funds From Operations” means, with respect to the Parent Guarantor, net income
(computed in accordance with GAAP), excluding gains (or losses) from sales of property and
extraordinary and unusual items, plus depreciation and amortization, and after adjustments
for unconsolidated Joint Ventures, provided that any determination of Funds From Operations
which pertains to the fiscal quarters of the Parent Guarantor ending on or prior to
September 30, 2010 shall be made on a pro forma basis, including to give effect to the IPO
and the Formation Transactions. Adjustments for
unconsolidated Joint Ventures will be calculated to reflect funds from operations on
the same basis.




18











 






     “GAAP” has the meaning specified in Section 1.03.




     “Good Faith Contest” means the contest of an item as to which: (a) such item is
contested in good faith, by appropriate proceedings, (b) reserves that are adequate are
established with respect to such contested item in accordance with GAAP or such contested
item is bonded over in accordance with statutory lien bonding procedures and (c) the failure
to pay or comply with such contested item during the period of such contest could not
reasonably be expected to result in a Material Adverse Effect.




     “Ground Lease” means each Affiliate Ground Lease, the Ground Lease (Mobile) and any
other Qualifying Ground Lease with respect to a Proposed Borrowing Base Asset that becomes
part of the Collateral, and “Ground Leases” means each Affiliate Ground Lease, Ground Lease
(Mobile) and the such other ground leases, collectively. As of the Closing Date, all Ground
Leases are as set forth on Schedule IV.




     “Ground Lease (Mobile)” means, collectively, (i) that certain Ground Lease Agreement,
dated as of September 8, 2006, between the University of South Alabama, as landlord and
master lessor, and USA Research and Technology Corporation, as master lessee, recorded in
the public records of Mobile County, Alabama on September 6, 2006 in Book 6040, Page 661, as
amended by that certain First Amendatory Ground Lease, between the same parties, dated
October 3, 2007, recorded in the Mobile Records on October 24, 2007 in Book 6278, Page 1536
and (ii) that certain Ground Lease, dated March 14, 2008, between USA Research and
Technology Corporation, as sub-landlord and sub-ground lessor, and Campus Crest at Mobile
Phase II, LLC, as sub-ground lessee, as amended by that certain First Amendment to Ground
Lease dated on or about the date hereof, as evidenced by that certain Memorandum of Ground
Lease, dated March 18, 2008, recorded in the public records of Mobile County, Alabama on
March 31, 2008 in Book 6355, Page 1270, and that certain First Amendment to Memorandum of
Ground Lease dated on or about the date hereof, to be recorded in said public records.




     “Ground Lease (Mobile) Default” has the meaning specified in Section 4.01(z)(iv).




     “Ground Leased Property (Mobile)” means the Campus Housing Asset located at the
University of South Alabama, Mobile, Alabama, which property is subject to the Ground Lease
(Mobile).




     “Ground Lease Payments” means all ground rents, square footage rents and percentage
rents and any other payments or rents owing under a Ground Lease.




     “Ground Lessor (Mobile)” means, with respect to the master ground lease, the University
of South Alabama, and, with respect to the sub-ground lease, USA Research and Technology
Corporation, together with each of its respective successors and assigns, as master ground
lessor and sub-ground lessor, respectively, under the Ground Lease (Mobile).




     “Guaranteed Obligations” has the meaning specified in Section 7.01.



19









 






     “Guarantor Deliverables” means each of the items set forth in Section 5.01(j).




     “Guarantors” has the meaning specified in the recital of parties to this Agreement.




     “Guaranty” means the Guaranty by the Guarantors pursuant to Article VII, together with
any and all Guaranty Supplements required to be delivered pursuant to Section 5.01(j) or
Section 7.05.




     “Guaranty Supplement” means a supplement entered into by an Additional Guarantor in
substantially the form of Exhibit C hereto.




     “Hazardous Indemnity Agreement” means each of the Environmental Indemnity Agreements
regarding Hazardous Materials now or hereafter made by the Borrower, Parent Guarantor and
Guarantors owning Borrowing Base Assets in favor of the Administrative Agent and the
Lenders, in substantially the form of Exhibit J hereto, as the same may be modified, amended
or ratified, pursuant to which the Borrower, Parent Guarantor and such Subsidiary Guarantor
agree to indemnify the Administrative Agent and the Lenders with respect to Hazardous
Materials and Environmental Laws.




     “Hazardous Materials” means (a) petroleum or petroleum products, by-products or
breakdown products, radioactive materials, asbestos-containing materials, polychlorinated
biphenyls, radon gas and mold and (b) any other chemicals, materials or substances
designated, classified or regulated as hazardous or toxic or as a pollutant or contaminant
under any Environmental Law.




     “Hedge Agreements” means interest rate swap, cap or collar agreements, interest rate
future or option contracts, currency swap agreements, currency future or option contracts
and other hedging agreements.




     “Hedge Bank” means any Lender Party or an Affiliate of a Lender Party in its capacity
as a party to a Secured Hedge Agreement.




     “Increase Date” has the meaning specified in Section 2.17(a).




     “Increasing Lender” has the meaning specified in Section 2.17(b).




     “Indemnified Costs” has the meaning specified in Section 8.05(a).




     “Indemnified Party” has the meaning specified in Section 7.06(a).




     “Information” has the meaning specified in Section 9.10.




     “Initial Extension of Credit” means the earlier to occur of the initial Borrowing and
the initial issuance of a Letter of Credit hereunder.




     “Initial Issuing Bank” has the meaning specified in the recital of parties to this
Agreement.



20









 






     “Initial Lenders” has the meaning specified in the recital of parties to this
Agreement.




     “Insufficiency” means, with respect to any Plan, the amount, if any, of its unfunded
benefit liabilities, as defined in Section 4001(a)(18) of ERISA.




     “Interest Period” means, for each Eurodollar Rate Advance comprising part of the same
Borrowing, the period commencing on the date of such Eurodollar Rate Advance or the date of
the Conversion of any Base Rate Advance into such Eurodollar Rate Advance, and ending on the
last day of the period selected by the Borrower pursuant to Section 2.07(c) and in
conformity with the provisions below and, thereafter, each subsequent period commencing on
the last day of the immediately preceding Interest Period and ending on the last day of the
period selected by the Borrower pursuant to the provisions below. The duration of each such
Interest Period shall be one, two, three or six months, as the Borrower may select;
provided, however, that:




     (a) the Borrower may not select any Interest Period with respect to any
Eurodollar Rate Advance that ends after the Termination Date;




     (b) Interest Periods commencing on the same date for Eurodollar Rate Advances
comprising part of the same Borrowing shall be of the same duration;




     (c) whenever the last day of any Interest Period would otherwise occur on a day
other than a Business Day, the last day of such Interest Period shall be extended to
occur on the next succeeding Business Day; provided, however, that if such extension
would cause the last day of such Interest Period to occur in the next following
calendar month, the last day of such Interest Period shall occur on the next
preceding Business Day; and




     (d) whenever the first day of any Interest Period occurs on a day of an initial
calendar month for which there is no numerically corresponding day in the calendar
month that succeeds such initial calendar month by the number of months equal to the
number of months in such Interest Period, such Interest Period shall end on the last
Business Day of such succeeding calendar month.




     “Internal Revenue Code” means the Internal Revenue Code of 1986, as amended from time
to time, and the regulations promulgated and rulings issued thereunder.




     “Investment” means (a) any loan or advance to any Person, any purchase or other
acquisition of any Equity Interests or Debt or the assets comprising a division or business
unit or a substantial part or all of the business of any Person, any capital contribution to
any Person or any other direct or indirect investment in any Person, including, without
limitation, any acquisition by way of a merger or consolidation and any arrangement pursuant
to which the investor incurs Debt of the types referred to in clause (i) or (j) of the
definition of “Debt” in respect of any Person, and (b) the purchase or other acquisition of
any real property.



21









 






     “IPO” means the initial public offering of common stock in the Parent Guarantor and its
registration as a public company with the Securities and Exchange Commission.




     “Issuing Bank” means the Initial Issuing Bank and any other Lender approved as an
Issuing Bank by the Administrative Agent and the Borrower and any Eligible Assignee to which
a Letter of Credit Commitment hereunder has been assigned pursuant to Section 9.07 so long
as each such Lender or each such Eligible Assignee expressly agrees to perform in accordance
with their terms all of the obligations that by the terms of this Agreement are required to
be performed by it as an Issuing Bank and notifies the Administrative Agent of its
Applicable Lending Office and the amount of its Letter of Credit Commitment (which
information shall be recorded by the Administrative Agent in the Register) for so long as
such Initial Issuing Bank, Lender or Eligible Assignee, as the case may be, shall have a
Letter of Credit Commitment.




     “Joint Venture” means any joint venture (a) in which the Parent Guarantor or any of its
Subsidiaries holds any Equity Interest, (b) that is not a Subsidiary of the Parent Guarantor
or any of its Subsidiaries and (c) the accounts of which would not appear on the
Consolidated financial statements of the Parent Guarantor.




     “Joint Venture Assets” means, with respect to any Joint Venture at any time, the assets
owned by such Joint Venture at such time.




     “JV Pro Rata Share” means, with respect to any Joint Venture at any time, the fraction,
expressed as a percentage, obtained by dividing (a) the total book value of all Equity
Interests in such Joint Venture held by the Parent Guarantor and any of its Subsidiaries by
(b) the total book value of all outstanding Equity Interests in such Joint Venture at such
time.




     “L/C Cash Collateral Account” means an account of the Borrower to be maintained with
the Administrative Agent, in the name of the Administrative Agent and under the sole control
and dominion of the Administrative Agent and subject to the terms of this Agreement.




     “L/C Related Documents” has the meaning specified in Section 2.04(c)(ii)(A).




     “L/C Termination Date Exposure” means the Available Amount under any Letter of Credit
with an expiration date later than 30 days before the Termination Date.




     “Lender Default” has the meaning specified in Section 9.07(k).




     “Lender Party” means any Lender, the Swing Line Bank or any Issuing Bank.




     “Lenders” means the Initial Lenders, each Acceding Lender that shall become a party
hereto pursuant to Section 2.17 and each Person that shall become a Lender hereunder
pursuant to Section 9.07 for so long as such Initial Lender or Person, as the case may be,
shall be a party to this Agreement.



22









 






     “Letter of Credit Advance” means an advance made by any Issuing Bank or any Lender
pursuant to Section 2.03(c).




     “Letter of Credit Agreement” has the meaning specified in Section 2.03(a).




     “Letter of Credit Commitment” means, with respect to any Issuing Bank at any time, the
amount set forth opposite such Issuing Bank’s name on Schedule I hereto under the caption
“Letter of Credit Commitment” or, if such Issuing Bank has entered into one or more
Assignment and Acceptances, set forth for such Issuing Bank in the Register maintained by
the Administrative Agent pursuant to Section 9.07(d) as such Issuing Bank’s “Letter of
Credit Commitment”, as such amount may be reduced at or prior to such time pursuant to
Section 2.05.




     “Letter of Credit Facility” means, at any time, an amount equal to the lesser of (a)
the aggregate amount of the Issuing Banks’ Letter of Credit Commitments at such time, and
(b) $15,000,000, as such amount may be reduced at or prior to such time pursuant to
Section 2.05.




     “Letters of Credit” has the meaning specified in Section 2.01(b).




     “Leverage Ratio” means, at any date of determination, the ratio of Total Debt (but
excluding, in all cases, any Contingent Obligations associated with the Excluded Recourse
Properties) to Total Asset Value as at the end of the most recently ended fiscal quarter of
the Parent Guarantor for which financial statements are required to be delivered to the
Lender Parties pursuant to Section 5.03(b) or (c), as the case may be.




     “Lien” means any lien, security interest or other charge or encumbrance of any kind, or
any other type of preferential arrangement, including, without limitation, the lien or
retained security title of a conditional vendor and any easement, right of way or other
encumbrance on title to real property.




     “Loan Documents” means (a) this Agreement, (b) the Notes, (c) the Fee Letter, (d) each
Letter of Credit Agreement, (e) each Guaranty Supplement, (f) the Collateral Documents, (g)
each Hazardous Indemnity Agreement, (h) each Manager’s Subordination and (i) each Secured
Hedge Agreement, in each case, as amended.




     “Loan Parties” means the Borrower and the Guarantors.




     “Management Agreements” means (a) the Management Agreements set forth on Part III of
Schedule 4.01(q) hereto (as amended or supplemented from time to time in accordance with the
provisions hereof), and (b) any Management Agreement in respect of a Borrowing Base Asset
entered into in compliance with Section 5.01(p).




     “Management Fee Adjustment” means, with respect to any Asset for any fiscal period, the
greater of (i) an amount equal to 4.0% of the total revenues generated from the operation of
such Asset for such fiscal period and (ii) all actual management fees payable in respect of
such Asset during such fiscal period.



23









 






     “Manager’s Subordination” means each of the Manager’s Consent and Subordination of
Management Agreements, now or hereafter made by an Approved Manager, the Borrower and the
Administrative Agent, in substantially the form of Exhibit K hereto, as the same may be
modified, amended or ratified.




     “Margin Stock” has the meaning specified in Regulation U.




     “Material Adverse Change” means a material adverse change in the business, condition
(financial or otherwise), results of operations or prospects of the Borrower or the Borrower
and its Subsidiaries, taken as a whole.




     “Material Adverse Effect” means a material adverse effect on (a) the business,
condition (financial or otherwise), operations or prospects of the Borrower and its
Subsidiaries, taken as a whole, (b) the rights and remedies of any Agent or any Lender Party
under any Loan Document, (c) the ability of any Loan Party to perform its Obligations under
any Loan Document to which it is or is to be a party, (d) the value of the Collateral or
(e) the value, use or ability to sell or refinance any Borrowing Base Asset.




     “Material Contract” means each contract to which the Borrower or any of its
Subsidiaries is a party involving aggregate consideration payable to or by the Borrower or
such Subsidiary in an amount of $5,000,000 or more per annum or otherwise material to the
business, condition (financial or otherwise), operations, performance, properties or
prospects of the Borrower and its Subsidiaries, taken as a whole. Without limitation of the
foregoing, the Management Agreements shall be deemed to comprise Material Contracts
hereunder.




     “Material Debt” means (a) Recourse Debt of Borrower that is outstanding in a principal
amount (or, in the case of any Hedge Agreement, an Agreement Value) of $10,000,000 or more,
either individually or in the aggregate or (b) any other Debt of any Loan Party or any
Subsidiary of a Loan Party that is outstanding in a principal amount (or, in the case of any
Hedge Agreement, an Agreement Value) of $25,000,000 or more, either individually or in the
aggregate; in each case (i) whether or not the primary obligation of the applicable obligor,
(ii) whether the subject of one or more separate debt instruments or agreements, and
(iii) exclusive of Debt outstanding under this Agreement. For the avoidance of doubt,
Material Debt may include Refinancing Debt to the extent comprising Material Debt as defined
herein.




     “Material Litigation” has the meaning specified in Section 3.01(f).




     “Moody’s” means Moody’s Investors Service, Inc. and any successor thereto.




     “Mortgage Policies” has the meaning specified in Section 3.01(a)(iii)(B).




     “Mortgages” has the meaning specified in Section 3.01(a)(iii).




     “Multiemployer Plan” means a multiemployer plan, as defined in Section 4001(a)(3) of
ERISA, to which any Loan Party or any ERISA Affiliate is making



24









 







or accruing an obligation to make contributions, or has within any of the preceding
five plan years made or accrued an obligation to make contributions.




     “Multiple Employer Plan” means a single employer plan, as defined in
Section 4001(a)(15) of ERISA, that (a) is maintained for employees of any Loan Party or any
ERISA Affiliate and at least one Person other than the Loan Parties and the ERISA Affiliates
or (b) was so maintained and in respect of which any Loan Party or any ERISA Affiliate could
have liability under Section 4064 or 4069 of ERISA in the event such plan has been or were
to be terminated.




     “Negative Pledge” means, with respect to any asset, any provision of a document,
instrument or agreement (other than a Loan Document) which prohibits or purports to prohibit
the creation or assumption of any Lien on such asset as security for Debt of the Person
owning such asset or any other Person.




     “Net Operating Income” means, with respect to any Borrowing Base Asset for any
applicable measurement period, (a) the total rental and other revenue from the operation of
such Borrowing Base Asset for such period, minus (b) all expenses and other proper charges
incurred in connection with the operation and maintenance of such Borrowing Base Asset for
such period (including, without limitation, management fees, repairs, real estate and
chattel taxes, bad debt expenses and all rentals payable under leases of real or personal
(or mixed) property, in each case, with respect to such Borrowing Base Asset for such
period), but before payment or provision for debt service charges, income taxes and
depreciation, amortization and other non-cash expenses, all as determined in accordance with
GAAP and in each case for consecutive four fiscal quarters of the Parent Guarantor most
recently ended.




     “Non-Recourse Debt” means Debt for Borrowed Money with respect to which recourse for
payment is limited to (a) any building(s) or parcel(s) of real property and any related
assets encumbered by a Lien securing such Debt for Borrowed Money and/or (b) (i) the general
credit of the Property-Level Subsidiary that has incurred such Debt for Borrowed Money,
and/or the direct Equity Interests therein and/or (ii) the general credit of the immediate
parent entity of such Property-Level Subsidiary, provided that such parent entity’s assets
consist solely of Equity Interests in such Property-Level Subsidiary, it being understood
that the instruments governing such Debt may include customary carve-outs to such limited
recourse (any such customary carve-outs or agreements limited to such customary carve-outs,
being a “Customary Carve-Out Agreement”) such as, for example, personal recourse to the
Parent Guarantor or any Subsidiary of the Parent Guarantor for fraud, misrepresentation,
misapplication or misappropriation of cash, waste, environmental claims, damage to
properties, non-payment of taxes or other liens despite the existence of sufficient cash
flow, interference with the enforcement of loan documents upon maturity or acceleration,
voluntary or involuntary bankruptcy filings, violation of loan document prohibitions against
transfer of properties or ownership interests therein and liabilities and other
circumstances customarily excluded by lenders from exculpation provisions and/or included in
separate indemnification and/or guaranty agreements in non-recourse financings of real
estate.



25









 






     “Note” means a promissory note of the Borrower payable to the order of any Lender, in
substantially the form of Exhibit A hereto, evidencing the aggregate indebtedness of the
Borrower to such Lender resulting from the Revolving Credit Advances, Swing Line Advances
and Letter of Credit Advances made by such Lender.




     “Notice of Borrowing” has the meaning specified in Section 2.02(a).




     “Notice of Issuance” has the meaning specified in Section 2.03(a).




     “Notice of Renewal” has the meaning specified in Section 2.01(b).




     “Notice of Swing Line Borrowing” has the meaning specified in Section 2.02(b).




     “Notice of Termination” has the meaning specified in Section 2.01(b).




     “NPL” means the National Priorities List under CERCLA.




     “Obligation” means, with respect to any Person, any payment, performance or other
obligation of such Person of any kind, including, without limitation, any liability of such
Person on any claim, whether or not the right of any creditor to payment in respect of such
claim is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured,
disputed, undisputed, legal, equitable, secured or unsecured, and whether or not such claim
is discharged, stayed or otherwise affected by any proceeding referred to in
Section 6.01(f). Without limiting the generality of the foregoing, the Obligations of any
Loan Party under the Loan Documents include (a) the obligation to pay principal, interest,
Letter of Credit commissions, charges, expenses, fees, attorneys’ fees and disbursements,
indemnities and other amounts payable by such Loan Party under any Loan Document and (b) the
obligation of such Loan Party to reimburse any amount in respect of any of the foregoing
that any Lender Party, in its sole discretion, may elect to pay or advance on behalf of such
Loan Party.




     “OECD” means the Organization for Economic Cooperation and Development.




     “OFAC” has the meaning specified in Section 4.01(aa).




     “Other Taxes” has the meaning specified in Section 2.12(b).




     “Parent Guarantor” has the meaning specified in the recital of parties to this
Agreement.




     “Participant” has the meaning specified in Section 2.03(c)(i).




     “Patriot Act” has the meaning specified in Section 9.12.




     “PBGC” means the Pension Benefit Guaranty Corporation (or any successor).



26









 






     “Permitted Liens” means such of the following as to which no enforcement, collection,
execution, levy or foreclosure proceeding shall have been commenced (except as expressly
permitted under this definition of “Permitted Liens”):




     (a) Liens for taxes, assessments and governmental charges or levies the payment of
which is not, at the time, required by Section 5.01(b);




     (b) statutory Liens of banks and rights of set off and other Liens imposed by law, such
as materialmen’s, mechanics’, carriers’, workmen’s and repairmen’s Liens and other similar
Liens arising in the ordinary course of business securing obligations, in each case, that
(i) are not overdue for a period of more than 30 days and (ii) individually or together with
all other Permitted Liens outstanding on any date of determination do not materially
adversely affect the use of the property to which they relate unless, in the case of (i) or
(ii) above, such Liens are the subject of a Good Faith Contest;




     (c) pledges or deposits to secure obligations under workers’ compensation or
unemployment laws or similar legislation or to secure public or statutory obligations;




     (d) easements, zoning restrictions, rights of way and other encumbrances on title to
real property that do not render title to the property encumbered thereby unmarketable or
materially adversely affect the use or value of such property for its present purposes;




     (e) Tenancy Leases;




     (f) Permitted Encumbrances (as defined in each of the Mortgages);




     (g) all Liens and other matters disclosed in the Mortgage Policies and such other title
and survey exceptions as the Administrative Agent has approved or may approve in writing in
its reasonable discretion;




     (h) Liens incurred or deposits made in the ordinary course of business to secure the
performance of tenders, statutory obligations, surety and appeal bonds, bids, leases,
government contracts, trade contracts, performance and return-of-money bonds and other
similar obligations (exclusive of obligations for the payment of borrowed money), so long as
no foreclosure, sale or similar proceedings have been commenced with respect to any portion
of the Collateral on account thereof;




     (i) any attachment or judgment Lien not constituting an Event of Default and not with
respect to any portion of the Collateral; or




     (j) Liens granted to the Administrative Agent for the benefit of the Lender Parties to
secure the Debt under the Loan Documents.




     “Person” means an individual, partnership, corporation (including a business trust),
limited liability company, joint stock company, trust, unincorporated association, joint
venture or other entity, or a government or any political subdivision or agency thereof.



27









 






     “Plan” means a Single Employer Plan or a Multiple Employer Plan.




     “Pledge Agreement” means the Pledge Agreement, made by the pledgors named therein in
favor of the Administrative Agent and the Lenders, in substantially the form of Exhibit L
hereto, as the same may be modified, amended or ratified.




     “Post Petition Interest” has the meaning specified in Section 7.07(b).




     “Potential Assignment Event Date” has the meaning specified in Section 9.01(b).




     “Potential Assignor Lender” has the meaning specified in Section 9.01(b).




     “Preferred Interests” means, with respect to any Person, Equity Interests issued by
such Person that are entitled to a preference or priority over any other Equity Interests
issued by such Person upon any distribution of such Person’s property and assets, whether by
dividend or upon liquidation.




     “Prohibited Person” has the meaning specified in Section 4.01(aa).




     “Property-Level Subsidiary” means any Subsidiary of the Borrower or any Joint Venture
that holds a direct fee or leasehold interest in any single building (or group of related
buildings, including, without limitation, buildings pooled for purposes of a Non-Recourse
Debt financing) or parcel (or group of related parcels, including, without limitation,
parcels pooled for purposes of a Non-Recourse Debt financing) of real property and related
assets and not in any other building or parcel of real property.




     “Proposed Borrowing Base Asset” has the meaning specified in Section 5.01(k).




     “Proposed Increased Commitment” has the meaning specified in Section 2.17(b).




     “Pro Rata Share” of any amount means, with respect to any Lender at any time, the
product of such amount times a fraction the numerator of which is the amount of such
Lender’s Revolving Credit Commitment at such time (or, if the Commitments shall have been
terminated pursuant to Section 2.05 or 6.01, such Lender’s Revolving Credit Commitment as in
effect immediately prior to such termination) and the denominator of which is the Revolving
Credit Facility at such time (or, if the Commitments shall have been terminated pursuant to
Section 2.05 or 6.01, the Revolving Credit Facility as in effect immediately prior to such
termination).




     “Purchasing Lender” has the meaning specified in Section 2.17(e).




     “Qualifying Ground Lease” means a ground lease of Real Property containing the
following terms and conditions: (a) a remaining term (exclusive of any unexercised
extension options that are subject to terms or conditions not yet agreed upon and specified
in such ground lease or an amendment thereto, other than a condition that the lessee not be
in default under such ground lease) of 30 years or more from the Closing Date; (b) the right
of the lessee to mortgage and encumber its interest in the leased



28









 







property without the consent of the lessor; (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 the ability to sublease; and (e) such other rights customarily required by
mortgagees making a loan secured by the interest of the holder of a leasehold estate demised
pursuant to a ground lease.




     “Real Property” means all right, title and interest of the Borrower and each of its
Subsidiaries in and to any land and any improvements located thereon, together with all
equipment, furniture, materials, supplies, personal property and all other rights and
property within the scope of the definition of Mortgaged Property (as defined in the Form of
Mortgage attached hereto as Exhibit G) in which such Person has an interest now or hereafter
located on or used in connection with such land and improvements, and all appurtenances,
additions, improvements, renewals, substitutions and replacements thereof now or hereafter
acquired by such Person.




     “Recourse Debt” means Debt for which the Borrower or any of its Subsidiaries has
personal or recourse liability in whole or in part, exclusive of any such Debt for which
such personal or recourse liability is limited to obligations under Customary Carve-Out
Agreements.




     “Reference Bank” means Citibank, N.A.




     “Refinancing Debt” means, with respect to any Debt, any Debt extending the maturity of,
or refunding or refinancing, in whole or in part, such Debt, provided that (a) the terms of
any Refinancing Debt, and of any agreement entered into and of any instrument issued in
connection therewith, (i) do not provide for any Lien on any Borrowing Base Assets, and
(ii) are not otherwise prohibited by the Loan Documents and (b) the principal amount of such
Debt shall not exceed the original principal amount of the Debt (as such Debt may have been
increased from time to time) being extended, refunded or refinanced plus the amount of any
applicable premium and expenses.




     “Register” has the meaning specified in Section 9.07(d).




     “Registration Statement” means the Parent Guarantor’s Form S-11 Registration Statement
filed with the Securities and Exchange Commission in connection with the IPO, as amended.




     “Regulation U” means Regulation U of the Board of Governors of the Federal Reserve
System, as in effect from time to time.




     “REIT” means a Person that is qualified to be treated for tax purposes as a real estate
investment trust under Sections 856-860 of the Internal Revenue Code.




     “Replacement Lender” has the meaning specified in Section 9.01(b).



29









 






     “Required Lenders” means, at any time, Lenders owed or holding greater than 66.67% of
the sum of (a) the aggregate principal amount of the Advances outstanding at such time,
(b) the aggregate Available Amount of all Letters of Credit outstanding at such time and
(c) the aggregate Unused Revolving Credit Commitments at such time. For purposes of this
definition, the aggregate principal amount of Swing Line Advances owing to the Swing Line
Bank and of Letter of Credit Advances owing to any Issuing Bank and the Available Amount of
each Letter of Credit shall be considered to be owed to the Revolving Lenders ratably in
accordance with their respective Revolving Credit Commitments.




     “Responsible Officer” means, with respect to any Loan Party, any officer of, or any
officer of any general partner or managing member of, such Loan Party, which Officer has
(a) responsibility for performing the underlying function that is the subject of the action
required of such officer hereunder, or (b) supervisory responsibility for such an officer.




     “Restricted Payments” has the meaning specified in Section 5.02(g).




     “Revolving Credit Advance” has the meaning specified in Section 2.01(a).




     “Revolving Credit Commitment” means, (a) with respect to any Lender at any time, the
amount set forth opposite such Lender’s name on Schedule I hereto under the caption
“Revolving Credit Commitment” or (b) if such Lender has entered into one or more Assignment
and Acceptances, set forth for such Lender in the Register maintained by the Administrative
Agent pursuant to Section 9.07(d) as such Lender’s “Revolving Credit Commitment”, as such
amount may be reduced at or prior to such time pursuant to Section 2.05.




     “Revolving Credit Facility” means, at any time, the aggregate amount of the Lenders’
Revolving Credit Commitments at such time.




     “S&P” means Standard & Poor’s Ratings Group, a division of The McGraw-Hill Companies,
Inc., and any successor thereto.




     “Sale and Leaseback Transaction” shall mean any arrangement with any Person providing
for the leasing by the Parent Guarantor or any of its Subsidiaries of any Real Property that
has been sold or transferred or is to be sold or transferred by the Parent Guarantor or such
Subsidiary, as the case may be, to such Person.




     “Sarbanes-Oxley” means the Sarbanes-Oxley Act of 2002, as amended.




     “Secured Hedge Agreement” means any Hedge Agreement required or permitted under
Article V that is entered into by and between any Loan Party and any Hedge Bank and that is
secured by the Collateral Documents.




     “Secured Obligations” means, collectively, the “Secured Obligations” as defined in the
Security Agreement and the “Obligations” as defined in the Mortgages.



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     “Secured Parties” means the Agents, the Lender Parties and the Hedge Banks.




     “Secured Recourse Debt Ratio” means, at any date of determination, the ratio, expressed
as a percentage, of (a) all Debt for which the Borrower and the Guarantors have personal or
recourse liability in whole or in part (exclusive of any such Debt for which such personal
or recourse liability is limited to obligations under Customary Carve-Out Agreements), plus,
without duplication, Contingent Obligations of the Borrower and the Guarantors, but
excluding, in all cases, any such Debt and Contingent Obligations associated with the
Excluded Recourse Properties to (b) Total Asset Value, in each case as at the end of the
most recently ended fiscal quarter of the Parent Guarantor for which financial statements
are required to be delivered to the Lender Parties pursuant to Section 5.03(b) or (c) as the
case may be.




     “Securities Act” means the Securities Act of 1933, as amended to the date hereof and
from time to time hereafter, and any successor statute.




     “Securities Exchange Act” means the Securities Exchange Act of 1934, as amended to the
date hereof and from time to time hereafter, and any successor statute.




     “Security Agreement” has the meaning specified in Section 3.01(a)(ii).




     “Selling Lender” has the meaning specified in Section 2.17(e).




     “Single Employer Plan” means a single employer plan, as defined in Section 4001(a)(15)
of ERISA, that (a) is maintained for employees of any Loan Party or any ERISA Affiliate and
no Person other than the Loan Parties and the ERISA Affiliates or (b) was so maintained and
in respect of which any Loan Party or any ERISA Affiliate could have liability under
Section 4069 of ERISA in the event such plan has been or were to be terminated.




     “Solvent” means, with respect to any Person on a particular date, that on such date
(a) the fair value of the property of such Person, on a going-concern basis, is greater than
the total amount of liabilities, including, without limitation, contingent liabilities, of
such Person, (b) the present fair salable value of the assets of such Person, on a
going-concern basis, is not less than the amount that will be required to pay the probable
liability of such Person on its debts as they become absolute and matured, (c) such Person
does not intend to, and does not believe that it will, incur debts or liabilities beyond
such Person’s ability to pay such debts and liabilities as they mature and (d) such Person
is not engaged in business or a transaction, and is not about to engage in business or a
transaction, for which such Person’s property would constitute an unreasonably small
capital. The amount of contingent liabilities at any time shall be computed as the amount
that, in the light of all the facts and circumstances existing at such time (including,
without limitation, after taking into account appropriate discount factors for the present
value of future contingent liabilities), represents the amount that can reasonably be
expected to become an actual or matured liability.




     “Standby Letter of Credit” means any Letter of Credit issued under the Letter of Credit
Facility, other than a Trade Letter of Credit.



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     “Subordinated Obligations” has the meaning specified in Section 7.07.




     “Subsidiary” of any Person means any corporation, partnership, joint venture, limited
liability company, trust or estate of which (or in which) 50% or more of (a) the issued and
outstanding capital stock having ordinary voting power to elect a majority of the Board of
Directors of such corporation (irrespective of whether at the time capital stock of any
other class or classes of such corporation shall or might have voting power upon the
occurrence of any contingency), (b) the interest in the capital or profits of such
partnership, joint venture or limited liability company or (c) the beneficial interest in
such trust or estate, in each case, is at the time directly or indirectly owned or
controlled by such Person, by such Person and one or more of its other Subsidiaries or by
one or more of such Person’s other Subsidiaries.




     “Subsidiary Guarantor” has the meaning specified in the recital of parties to this
Agreement.




     “Supplemental Collateral Agent” has the meaning specified in Section 8.01(b).




     “Surviving Debt” means Debt of each Loan Party and its Subsidiaries outstanding
immediately before and after giving effect to the IPO, the Formation Transactions and the
Initial Extension of Credit.




     “Swing Line Advance” means an advance made by (a) the Swing Line Bank pursuant to
Section 2.01(c) or (b) any Lender pursuant to Section 2.02(b).




     “Swing Line Bank” means Citibank, in its capacity as the Lender of Swing Line Advances,
and its successors and permitted assigns in such capacity.




     “Swing Line Borrowing” means a borrowing consisting of a Swing Line Advance made by the
Swing Line Bank pursuant to Section 2.01(c) or the Lenders pursuant to Section 2.02(b).




     “Swing Line Commitment” means, with respect to the Swing Line Bank, the amount of the
Swing Line Facility set forth in Section 2.01(c), as such amount may be reduced at or prior
to such time pursuant to Section 2.05.




     “Swing Line Facility” has the meaning specified in Section 2.01(c).




     “Taxes” has the meaning specified in Section 2.12(a).




     “Tenancy Leases” means operating leases, subleases, licenses, occupancy agreements and
rights-of-use entered into by the Borrower or any of its Subsidiaries in its capacity as a
lessor or a similar capacity in the ordinary course of business that do not materially and
adversely affect the use of the Real Property encumbered thereby for its intended purpose
(excluding any lease entered into in connection with a Sale and Leaseback Transaction).



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     “Termination Date” means the earlier of (a) the third anniversary of the Closing Date,
subject to the extension thereof pursuant to Section 2.16 and (b) the date of termination in
whole of the Revolving Credit Commitments, the Swing Line Commitment and the Letter of
Credit Commitments pursuant to Section 2.05 or 6.01.




     “Test Date” means (a) the last day of each fiscal quarter of the Parent Guarantor for
which financial statements are required to be delivered pursuant to Sections 5.03(b) or (c),
as the case may be, (b) the date of each Advance or the issuance or renewal of any Letter of
Credit, (c) the date of the addition of any Proposed Borrowing Base Asset to the Collateral
pursuant to Section 5.01(k), (d) the effective date of any merger permitted under
Section 5.02(d), (e) the effective date of any Transfer permitted under
Section 5.02(e)(ii)(C), (f) with respect to an extension of the Maturity Date pursuant to
Section 2.16, the date of delivery of financial statements of the Borrower thereunder, and
(g) the date of the release of Liens with respect to any Borrowing Base Asset.




     “Total Asset Value” means, at any date of determination, the sum of the Asset Values
for all Assets at such date plus unrestricted Cash and Cash Equivalents.




     “Total Borrowing Base Value” means, at any date of determination, the sum of the
Borrowing Base Values of all Borrowing Base Assets.




     “Total Debt” means, at any date of determination, all Debt of the Parent Guarantor and
its Subsidiaries as at the end of the most recently ended fiscal quarter of the Parent
Guarantor for which financial statements are required to be delivered to the Lender Parties
pursuant to Section 5.03(b) or (c), as the case may be.




     “Trade Letter of Credit” means any Letter of Credit that is issued under the Letter of
Credit Facility for the benefit of a supplier of inventory to the Borrower or any of its
Subsidiaries to effect payment for such inventory.




     “Transfer” has the meaning specified in Section 5.02(e)(i).




     “Type” refers to the distinction between Advances bearing interest at the Base Rate and
Advances bearing interest at the Eurodollar Rate.




     “Unused Fee” has the meaning specified in Section 2.08(a).




     “Unused Revolving Credit Commitment” means, with respect to any Lender at any date of
determination, (a) such Lender’s Revolving Credit Commitment at such time minus (b) the sum
of (i) the aggregate principal amount of all Revolving Credit Advances, Swing Line Advances
and Letter of Credit Advances made by such Lender (in its capacity as a Lender) and
outstanding at such time plus (ii) such Lender’s Pro Rata Share of (A) the aggregate
Available Amount of all Letters of Credit outstanding at such time, (B) the aggregate
principal amount of all Letter of Credit Advances made by the Issuing Banks pursuant to
Section 2.03(c) and outstanding at such time and (C) the aggregate principal amount of all
Swing Line Advances made by the Swing Line Bank pursuant to Section 2.01(c) and outstanding
at such time.



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     “Voting Interests” means shares of capital stock issued by a corporation, or equivalent
Equity Interests in any other Person, the holders of which are ordinarily, in the absence of
contingencies, entitled to vote for the election of directors (or the election or
appointment of persons performing similar functions) of such Person, even if the right so to
vote has been suspended by the happening of such a contingency.




     “Welfare Plan” means a welfare plan, as defined in Section 3(1) of ERISA, that is
maintained for employees of any Loan Party or in respect of which any Loan Party could have
liability under applicable law.




     “Withdrawal Liability” has the meaning specified in Part I of Subtitle E of Title IV of
ERISA.



          SECTION 1.02. Computation of Time Periods; Other Definitional Provisions. In this Agreement and the
other Loan Documents in the computation of periods of time from a specified date to a later
specified date, the word “from” means “from and including” and the words “to” and “until” each mean
“to but excluding”. References in the Loan Documents to any agreement or contract “as amended”
shall mean and be a reference to such agreement or contract as amended, amended and restated,
supplemented or otherwise modified from time to time in accordance with its terms.




          SECTION 1.03. Accounting Terms. All accounting terms not specifically defined herein shall be
construed in accordance with generally accepted accounting principles consistent with those applied
in the preparation of the financial statements referred to in Section 4.01(g) (“GAAP”).




ARTICLE II

AMOUNTS AND TERMS OF THE ADVANCES AND THE LETTERS OF CREDIT




          SECTION 2.01. The Advances and the Letters of Credit. (a) The Revolving Credit Advances.
Each Lender severally agrees, on the terms and conditions hereinafter set forth, to make advances
(each, a “Revolving Credit Advance”) to the Borrower from time to time on any Business Day during
the period from the date hereof until the Termination Date in an amount for each such Advance not
to exceed such Lender’s Unused Revolving Credit Commitment at such time. Each Borrowing shall be
in an aggregate amount of $1,000,000 or an integral multiple of $500,000 in excess thereof and
shall consist of Revolving Credit Advances made simultaneously by the Lenders ratably according to
their Revolving Credit Commitments. Within the limits of each Lender’s Unused Revolving Credit
Commitment in effect from time to time and prior to the Termination Date, the Borrower may borrow
under this Section 2.01(a), prepay pursuant to Section 2.06(a) and reborrow under this
Section 2.01(a).




          (b) Letters of Credit. Each Issuing Bank severally agrees, on the terms and
conditions hereinafter set forth, to issue (or cause its Affiliate that is a commercial bank to
issue on its behalf) letters of credit (the “Letters of Credit”), for the account of the Borrower
from time to time on any Business Day during the period from the date hereof until 30 days before
the Termination Date in an aggregate Available Amount (i) for all Letters of Credit not to exceed
at any time the Letter of Credit Facility at such time, (ii) for all Letters of Credit issued by
such






34









 







Issuing Bank not to exceed such Issuing Bank’s Letter of Credit Commitment at such time, and
(iii) for each such Letter of Credit not to exceed the Unused Revolving Credit Commitments of the
Lenders at such time. No Letter of Credit shall have an expiration date (including all rights of
the Borrower or the beneficiary to require renewal) later than the earlier of 30 days before the
Termination Date (provided such Letter of Credit may have an expiration date after the date that is
30 days before the Termination Date, but not after the Termination Date, so long as such Letter of
Credit obligates the Borrower to Cash Collateralize such Letter of Credit in accordance with
Section 2.03(e)) and (A) in the case of a Standby Letter of Credit one year after the date of
issuance thereof, but may by its terms be renewable annually upon notice (a “Notice of Renewal”)
given to the Issuing Bank that issued such Standby Letter of Credit and the Administrative Agent on
or prior to any date for notice of renewal set forth in such Letter of Credit but in any event at
least three Business Days prior to the date of the proposed renewal of such Standby Letter of
Credit and upon fulfillment of the applicable conditions set forth in Article III unless such
Issuing Bank has notified the Borrower (with a copy to the Administrative Agent) on or prior to the
date for notice of termination set forth in such Letter of Credit but in any event at least 30
Business Days prior to the date of automatic renewal of its election not to renew such Standby
Letter of Credit (a “Notice of Termination”) and (B) in the case of a Trade Letter of Credit, 180
days after the date of issuance thereof; provided, however, that the terms of each Standby Letter
of Credit that is automatically renewable annually shall (x) require the Issuing Bank that issued
such Standby Letter of Credit to give the beneficiary named in such Standby Letter of Credit notice
of any Notice of Termination, (y) permit such beneficiary, upon receipt of such notice, to draw
under such Standby Letter of Credit prior to the date such Standby Letter of Credit otherwise would
have been automatically renewed and (z) not permit the expiration date (after giving effect to any
renewal) of such Standby Letter of Credit in any event to be extended to a date later than 30 days
before the Termination Date (provided such Letter of Credit may have an expiration date after the
date that is 30 days before the Termination Date, but not after the Termination Date, so long as
such Letter of Credit obligates the Borrower to Cash Collateralize such Letter of Credit in
accordance with Section 2.03(e)). If either a Notice of Renewal is not given by the Borrower or a
Notice of Termination is given by the relevant Issuing Bank pursuant to the immediately preceding
sentence, such Standby Letter of Credit shall expire on the date on which it otherwise would have
been automatically renewed; provided, however, that even in the absence of receipt of a Notice of
Renewal the relevant Issuing Bank may in its discretion, unless instructed to the contrary by the
Administrative Agent or the Borrower, deem that a Notice of Renewal had been timely delivered and
in such case, a Notice of Renewal shall be deemed to have been so delivered for all purposes under
this Agreement. Within the limits of the Letter of Credit Facility, and subject to the limits
referred to above, the Borrower may request the issuance of Letters of Credit under this
Section 2.01(b), repay any Letter of Credit Advances resulting from drawings thereunder pursuant to
Section 2.04(c) and request the issuance of additional Letters of Credit under this
Section 2.01(b).




          (c) Swing Line Advances. The Borrower may request the Swing Line Bank to make, and
the Swing Line Bank agrees to make, on the terms and conditions hereinafter set forth, Swing Line
Advances to the Borrower from time to time on any Business Day during the period from the date
hereof until the Termination Date (i) in an aggregate amount not to exceed at any time outstanding
$10,000,000 (the “Swing Line Facility”) and (ii) in an amount for each such Swing Line Borrowing
not to exceed the aggregate of the Unused Revolving Credit Commitments of the Lenders at such time.
No Swing Line Advance shall be used for the






35









 







purpose of funding the payment of principal of any other Swing Line Advance. Each Swing Line
Borrowing shall be in an amount of $250,000 or an integral multiple of $250,000 in excess thereof
and shall be made as a Base Rate Advance. Within the limits of the Swing Line Facility and within
the limits referred to in clause (ii) above, the Borrower may borrow under this Section 2.01(c),
repay pursuant to Section 2.04(b) or prepay pursuant to Section 2.06(a) and reborrow under this
Section 2.01(c).




          SECTION 2.02. Making the Advances. (a) Except as otherwise provided in Section 2.03, each
Borrowing (other than a Swing Line Borrowing) shall be made on notice, given not later than 12:00
Noon (New York City time) on the third Business Day prior to the date of the proposed Borrowing in
the case of a Borrowing consisting of Eurodollar Rate Advances, or not later than 12:00 Noon (New
York City time) on the date of the proposed Borrowing in the case of a Borrowing consisting of Base
Rate Advances, by the Borrower to the Administrative Agent, which shall give to each Lender prompt
notice thereof by telex or telecopier. Each such notice of a Borrowing (a “Notice of Borrowing”)
shall be by telephone, confirmed immediately in writing, or telex or telecopier or e-mail, in each
case in substantially the form of Exhibit B hereto, specifying therein the requested (i) date of
such Borrowing, (ii) Type of Advances comprising such Borrowing, (iii) aggregate amount of such
Borrowing and (iv) in the case of a Borrowing consisting of Eurodollar Rate Advances, initial
Interest Period for each such Advance. Each Lender shall, before 12:00 Noon (New York City time)
on the date of such Borrowing in the case of a Borrowing consisting of Eurodollar Rate Advances and
1:00 P.M. (New York City time) on the date of such Borrowing in the case of a Borrowing consisting
of Base Rate Advances, make available for the account of its Applicable Lending Office to the
Administrative Agent at the Administrative Agent’s Account, in same day funds, such Lender’s
ratable portion of such Borrowing in accordance with the respective Commitments of such Lender and
the other Lenders. After the Administrative Agent’s receipt of such funds and upon fulfillment of
the applicable conditions set forth in Article III, the Administrative Agent will make such funds
available to the Borrower by crediting the Borrower’s Account; provided, however, that the
Administrative Agent shall first make a portion of such funds equal to the aggregate principal
amount of any Swing Line Advances and Letter of Credit Advances made by the Swing Line Bank or any
Issuing Bank, as the case may be, and by any other Lender and outstanding on the date of such
Borrowing, plus interest accrued and unpaid thereon to and as of such date, available to the Swing
Line Bank or such Issuing Bank, as the case may be, and such other Lenders for repayment of such
Swing Line Advances and Letter of Credit Advances.




          (b) Each Swing Line Borrowing shall be made on notice, given not later than 12:00 Noon (New
York City time) on the date of the proposed Swing Line Borrowing, by the Borrower to the Swing Line
Bank and the Administrative Agent. Each such notice of a Swing Line Borrowing (a “Notice of Swing
Line Borrowing”) shall be by telephone, confirmed immediately in writing or by telecopier or
e-mail, in each case in substantially the form of Exhibit B hereto, specifying therein the
requested (i) date of such Borrowing, (ii) amount of such Borrowing and (iii) maturity of such
Borrowing (which maturity shall be no later than the earlier of (A) the fifteenth day after the
requested date of such Borrowing and (B) the Termination Date). The Swing Line Bank shall, before
1:00 P.M. (New York City time) on the date of such Swing Line Borrowing, make the amount thereof
available to the Administrative Agent at the Administrative Agent’s Account, in same day funds.
After the Administrative Agent’s receipt of such funds and upon fulfillment of the applicable
conditions set forth in Article III, the






36









 







Administrative Agent will make such funds available to the Borrower by crediting the
Borrower’s Account. Upon written demand by the Swing Line Bank, with a copy of such demand to the
Administrative Agent, each other Lender shall purchase from the Swing Line Bank, and the Swing Line
Bank shall sell and assign to each such other Lender, such other Lender’s Pro Rata Share of such
outstanding Swing Line Advance as of the date of such demand, by making available for the account
of its Applicable Lending Office to the Administrative Agent for the account of the Swing Line
Bank, by deposit to the Administrative Agent’s Account, in same day funds, an amount equal to the
portion of the outstanding principal amount of such Swing Line Advance to be purchased by such
Lender. The Borrower hereby agrees to each such sale and assignment. Each Lender agrees to
purchase its Pro Rata Share of an outstanding Swing Line Advance on (i) the Business Day on which
demand therefor is made by the Swing Line Bank, provided that notice of such demand is given not
later than 12:00 Noon (New York City time) on such Business Day or (ii) the first Business Day next
succeeding such demand if notice of such demand is given after such time. Upon any such assignment
by the Swing Line Bank to any other Lender of a portion of a Swing Line Advance, the Swing Line
Bank represents and warrants to such other Lender that the Swing Line Bank is the legal and
beneficial owner of such interest being assigned by it, but makes no other representation or
warranty and assumes no responsibility with respect to such Swing Line Advance, the Loan Documents
or any Loan Party. If and to the extent that any Lender shall not have so made the amount of such
Swing Line Advance available to the Administrative Agent, such Lender agrees to pay to the
Administrative Agent forthwith on demand such amount together with interest thereon, for each day
from the date of demand by the Swing Line Bank until the date such amount is paid to the
Administrative Agent, at the Federal Funds Rate. If such Lender shall pay to the Administrative
Agent such amount for the account of the Swing Line Bank on any Business Day, such amount so paid
in respect of principal shall constitute a Swing Line Advance made by such Lender on such Business
Day for purposes of this Agreement, and the outstanding principal amount of the Swing Line Advance
made by the Swing Line Bank shall be reduced by such amount on such Business Day.




          (c) Anything in subsection (a) above to the contrary notwithstanding, (i) the Borrower may not
select Eurodollar Rate Advances for the initial Borrowing hereunder or for any Borrowing if the
aggregate amount of such Borrowing is less than $1,000,000 or if the obligation of the Lenders to
make Eurodollar Rate Advances shall then be suspended pursuant to Section 2.07(d)(ii), 2.09 or 2.10
and (ii) there may not be more than six separate Interest Periods in effect hereunder at any time.




          (d) Each Notice of Borrowing and Notice of Swing Line Borrowing shall be irrevocable and
binding on the Borrower. In the case of any Borrowing that the related Notice of Borrowing
specifies is to be comprised of Eurodollar Rate Advances, the Borrower shall indemnify each Lender
against any loss, cost or expense incurred by such Lender as a result of any failure to fulfill on
or before the date specified in such Notice of Borrowing for such Borrowing the applicable
conditions set forth in Article III, including, without limitation, any loss, cost or expense
incurred by reason of the liquidation or reemployment of deposits or other funds acquired by such
Lender to fund the Advance to be made by such Lender as part of such Borrowing when such Advance,
as a result of such failure, is not made on such date.







37









 








          (e) Unless the Administrative Agent shall have received notice from a Lender prior to (x) the
date of any Borrowing consisting of Eurodollar Rate Advances or (y) 12:00 Noon (New York City time)
on the date of any Borrowing consisting of Base Rate Advances that such Lender will not make
available to the Administrative Agent such Lender’s ratable portion of such Borrowing, the
Administrative Agent may assume that such Lender has made such portion available to the
Administrative Agent on the date of such Borrowing in accordance with subsection (a) of this
Section 2.02 and the Administrative Agent may, in reliance upon such assumption, make available to
the Borrower on such date a corresponding amount. If and to the extent that such Lender shall not
have so made such ratable portion available to the Administrative Agent, such Lender and the
Borrower severally agree to repay or pay to the Administrative Agent forthwith on demand such
corresponding amount and to pay interest thereon, for each day from the date such amount is made
available to the Borrower until the date such amount is repaid or paid to the Administrative Agent,
at (i) in the case of the Borrower, the interest rate applicable at such time under Section 2.07 to
Advances comprising such Borrowing and (ii) in the case of such Lender, the Federal Funds Rate. If
the Borrower and such Lender shall pay such interest to the Administrative Agent for the same or an
overlapping period, the Administrative Agent shall promptly remit to the Borrower the amount of
such interest paid by the Borrower for such period. If such Lender shall pay to the Administrative
Agent such corresponding amount, such amount so paid shall constitute such Lender’s Advance as part
of such Borrowing for all purposes.




          (f) The failure of any Lender to make the Advance to be made by it as part of any Borrowing
shall not relieve any other Lender of its obligation, if any, hereunder to make its Advance on the
date of such Borrowing, but no Lender shall be responsible for the failure of any other Lender to
make the Advance to be made by such other Lender on the date of any Borrowing.




          SECTION 2.03. Issuance of and Drawings and Reimbursement Under Letters of Credit. (a) Request
for Issuance. Each Letter of Credit shall be issued upon notice, given not later than 12:00
Noon (New York City time) on the fifth Business Day prior to the date of the proposed issuance of
such Letter of Credit, by the Borrower to any Issuing Bank, which shall give to the Administrative
Agent and each Lender prompt notice thereof by telex, telecopier or e mail or by means of the
Approved Electronic Platform. Each such notice of issuance of a Letter of Credit (a “Notice of
Issuance”) shall be by telephone, confirmed immediately in writing, telex, telecopier or e-mail, in
each case specifying therein the requested (i) date of such issuance (which shall be a Business
Day), (ii) Available Amount of such Letter of Credit, (iii) expiration date of such Letter of
Credit, (iv) name and address of the beneficiary of such Letter of Credit and (v) form of such
Letter of Credit, and shall be accompanied by such application and agreement for letter of credit
as such Issuing Bank may specify to the Borrower for use in connection with such requested Letter
of Credit (a “Letter of Credit Agreement”). If the requested form of such Letter of Credit is
acceptable to such Issuing Bank in its sole discretion, such Issuing Bank will, upon fulfillment of
the applicable conditions set forth in Article III, make such Letter of Credit available to the
Borrower at its office referred to in Section 9.02 or as otherwise agreed with the Borrower in
connection with such issuance. In the event and to the extent that the provisions of any Letter of
Credit Agreement shall conflict with this Agreement, the provisions of this Agreement shall govern.







38









 








          (b) Letter of Credit Reports. Each Issuing Bank shall furnish (i) to each Lender and
the Borrower on the first Business Day of each month a written report summarizing issuance and
expiration dates of Letters of Credit issued by such Issuing Bank during the preceding month and
drawings during such month under all Letters of Credit issued by such Issuing Bank and (ii) to the
Administrative Agent and each Lender and the Borrower on the first Business Day of each calendar
quarter a written report setting forth the average daily aggregate Available Amount during the
preceding calendar quarter of all Letters of Credit issued by such Issuing Bank.




          (c) Letter of Credit Participations; Drawing and Reimbursement.
(i) Immediately upon the issuance by the Issuing Bank of any Letter of Credit, the Issuing
Bank shall be deemed to have sold and transferred to each Lender, and each Lender (in its capacity
under this Section 2.03(c), a “Participant”) shall be deemed irrevocably and unconditionally to
have purchased and received from the Issuing Bank, without recourse or warranty, an undivided
interest and participation in such Letter of Credit, to the extent of such Participant’s Pro Rata
Share of the Available Amount of such Letter of Credit, each drawing or payment made thereunder and
the obligations of the Borrower under this Agreement with respect thereto, and any security
therefor or guaranty pertaining thereto. Upon any change in the Revolving Credit Commitments or
the Lenders’ respective Pro Rata Shares pursuant to Section 9.07, it is hereby agreed that, with
respect to all outstanding Letters of Credit and unpaid drawings relating thereto, there shall be
an automatic adjustment to the participations pursuant to this Section 2.03(c) to reflect the new
Pro Rata Shares of the assignor and assignee Lenders, as the case may be.





     (ii) In determining whether to pay under any Letter of Credit, the Issuing Bank shall
not have any obligation with respect to the other Revolving Credit Lenders other than to
confirm that any documents required to be delivered under such Letter of Credit appear to
have been delivered and that they appear to substantially comply on their face with the
requirements of such Letter of Credit. Any action taken or omitted to be taken by the
Issuing Bank under or in connection with any Letter of Credit issued by it shall not create
for the Issuing Bank any resulting liability to the Borrower, any other Loan Party, any
Revolving Credit Lender or any other Person unless such action is taken or omitted to be
taken with gross negligence or willful misconduct on the part of the Issuing Bank (as
determined by a court of competent jurisdiction in a final non-appealable judgment).




     (iii) The payment by any Issuing Bank of a draft drawn under any Letter of Credit shall
constitute for all purposes of this Agreement the making by such Issuing Bank of a Letter of
Credit Advance, which shall be a Base Rate Advance, in the amount of such draft. In the
event that the Issuing Bank makes any payment under any Letter of Credit issued by it and
the Borrower shall not have reimbursed such amount in full to the Issuing Bank pursuant to
Section 2.04(c), the Issuing Bank shall promptly notify the Administrative Agent, which
shall promptly notify each Participant of such failure, and each Participant shall promptly
and unconditionally pay to the Administrative Agent for the account of the Issuing Bank the
amount of such Participant’s Pro Rata Share of such unreimbursed payment in U.S. dollars and
in same day funds. Upon such notification by the Administrative Agent to any Participant
required to fund a payment under a Letter of Credit, such Participant shall make available
to the Administrative Agent for the account



39









 







of the Issuing Bank its Pro Rata Share of an outstanding Letter of Credit Advance on
(i) the Business Day on which demand therefor is made by the Issuing Bank which made such
Advance, provided that notice of such demand is given not later than 11:00 A.M. (New York
City time) on such Business Day, or (ii) the first Business Day next succeeding such demand
if notice of such demand is given after such time. If such Lender shall pay to the
Administrative Agent such amount for the account of such Issuing Bank on any Business Day,
such amount so paid in respect of principal shall constitute a Letter of Credit Advance made
by such Lender on such Business Day for purposes of this Agreement, and the outstanding
principal amount of the Letter of Credit Advance made by such Issuing Bank shall be reduced
by such amount on such Business Day. If and to the extent that any Lender shall not have so
made the amount of such Letter of Credit Advance available to the Administrative Agent, such
Lender agrees to pay to the Administrative Agent forthwith on demand such amount together
with interest thereon, for each day from the date of demand by such Issuing Bank until the
date such amount is paid to the Administrative Agent, at the Federal Funds Rate for its
account or the account of such Issuing Bank, as applicable.




     (iv) Whenever the Issuing Bank receives a payment of a reimbursement obligation as to
which it has received any payments from the Participants pursuant to clause (iii) above, the
Issuing Bank shall pay to the Administrative Agent for the account of each such Participant
that has paid its Pro Rata Share thereof, in same day funds, an amount equal to such
Participant’s share (based upon the proportionate aggregate amount originally funded by such
Participant to the aggregate amount funded by all Participants) of the principal amount of
such reimbursement obligation and interest thereon accruing after the purchase of the
respective participations.



          (d) Failure to Make Letter of Credit Advances. The failure of any Lender to make the
Letter of Credit Advance to be made by it on the date specified in Section 2.03(c) shall not
relieve any other Lender of its obligation hereunder to make its Letter of Credit Advance on such
date, but no Lender shall be responsible for the failure of any other Lender to make the Letter of
Credit Advance to be made by such other Lender on such date.




          (e) Cash Collateral.





     (i) If the expiration date of any Letter of Credit would be later than 30 days before
the Termination Date, then, any such Letter of Credit shall expressly provide, as a
condition to the Issuing Bank’s issuance of such Letter of Credit, that Borrower shall be
required, commencing on the date that is 30 days before the Termination Date and at all
times thereafter, to Cash Collateralize such Letter of Credit by delivering to
Administrative Agent Cash Collateral in an amount sufficient to cover all L/C Termination
Date Exposure. Borrower shall comply with the terms and conditions of any such Letter of
Credit requiring Cash Collateralization.




     (ii) All Cash Collateral (other than credit support not constituting funds subject to
deposit) shall be maintained in blocked, non-interest bearing deposit accounts at the
Administrative Agent. The Borrower hereby grants to (and subjects to the control of) the
Administrative Agent, for the benefit of the Administrative Agent and the Issuing



40









 







Bank, and agrees to maintain, a first priority security interest in all such cash,
deposit accounts and all balances therein, and all other property so provided as collateral
pursuant hereto, and in all proceeds of the foregoing, all as security for the obligations
to which such Cash Collateral may be applied pursuant to Section 2.03(e). If at any
time the Administrative Agent determines that Cash Collateral is subject to any right or
claim of any Person other than the Administrative Agent as herein provided, or that the
total amount of such Cash Collateral is less than the applicable L/C Termination Date
Exposure and other obligations secured thereby, the Borrower will, promptly upon demand by
the Administrative Agent, pay or provide to the Administrative Agent additional Cash
Collateral in an amount sufficient to eliminate such deficiency.




     (iii) Notwithstanding anything to the contrary contained in this Agreement, Cash
Collateral provided under this Section 2.03(e) in respect of Letters of Credit shall
be held and applied to the satisfaction of the specific Available Amount of such Letters of
Credit and other obligations for which the Cash Collateral was so provided, prior to any
other application of such property as may be provided for herein.




     (iv) Cash Collateral (or the appropriate portion thereof) provided to reduce L/C
Termination Date Exposure or other obligations shall be released promptly following (i) the
elimination of the applicable L/C Termination Date Exposure or other obligations giving rise
thereto or (ii) the Administrative Agent’s good faith determination that there exists excess
Cash Collateral; provided, however, that the Person providing Cash Collateral and the
Issuing Bank may agree that Cash Collateral shall not be released but instead held to
support future anticipated L/C Termination Date Exposure or other obligations.



          SECTION 2.04. Repayment of Advances. (a) Revolving Credit Advances. The Borrower shall
repay to the Administrative Agent for the ratable account of the Lenders on the Termination Date
the aggregate outstanding principal amount of the Revolving Credit Advances then outstanding.




          (b) Swing Line Advances. The Borrower shall repay to the Administrative Agent for the
account of (i) the Swing Line Bank and (ii) each other Lender that has made a Swing Line Advance by
purchase from the Swing Line Bank pursuant to Section 2.02(b), the outstanding principal amount of
each Swing Line Advance made by each of them on the earlier of the maturity date specified in the
applicable Notice of Swing Line Borrowing (which maturity shall be no later than the fifteenth day
after the requested date of such Swing Line Borrowing) and the Termination Date.




          (c) Letter of Credit Advances. (i) The Borrower shall repay to the Administrative
Agent for the account of each Issuing Bank and each other Lender that has made a Letter of Credit
Advance on the same day on which such Advance was made the outstanding principal amount of each
Letter of Credit Advance made by each of them.





     (ii) The Obligations of the Borrower under this Agreement, any Letter of Credit
Agreement and any other agreement or instrument relating to any Letter of Credit (and the
obligations of each Lender to reimburse the Issuing Bank with respect thereto)



41









 







shall be unconditional and irrevocable, and shall be paid strictly in accordance with
the terms of this Agreement, such Letter of Credit Agreement and such other agreement or
instrument under all circumstances, including, without limitation, the following
circumstances:




     (A) any lack of validity or enforceability of any Loan Document, any Letter of
Credit Agreement, any Letter of Credit or any other agreement or instrument relating
thereto (all of the foregoing being, collectively, the “L/C Related Documents”);




     (B) any change in the time, manner or place of payment of, or in any other term
of, all or any of the Obligations of the Borrower in respect of any L/C Related
Document or any other amendment or waiver of or any consent to departure from all or
any of the L/C Related Documents;




     (C) the existence of any claim, set off, defense or other right that the
Borrower may have at any time against any beneficiary or any transferee of a Letter
of Credit (or any Persons for which any such beneficiary or any such transferee may
be acting), any Issuing Bank or any other Person, whether in connection with the
transactions contemplated by the L/C Related Documents or any unrelated transaction;




     (D) any 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 being untrue or inaccurate in any respect;




     (E) payment by any Issuing Bank under a Letter of Credit against presentation
of a draft or certificate that does not strictly comply with the terms of such
Letter of Credit;




     (F) any exchange, release or non-perfection of any Collateral or other
collateral, or any release or amendment or waiver of or consent to departure from
the Guaranties or any other guarantee, for all or any of the Obligations of the
Borrower in respect of the L/C Related Documents; or




     (G) any other circumstance or happening whatsoever, whether or not similar to
any of the foregoing, including, without limitation, any other circumstance that
might otherwise constitute a defense available to, or a discharge of, the Borrower
or a guarantor.



          SECTION 2.05. Termination or Reduction of the Commitments. (a) Optional. The Borrower
may, upon at least three Business Days’ notice to the Administrative Agent, terminate in whole or
reduce in part the unused portions of the Swing Line Facility, the Letter of Credit Facility and
the Unused Revolving Credit Commitments; provided, however, that each partial reduction of a
Facility (i) shall be in an aggregate amount of $1,000,000 (or, in the case of the Swing Line
Facility, $250,000) or an integral multiple of $250,000 in excess thereof and (ii) shall be made
ratably among the Lenders in accordance with their Commitments with respect to such Facility.







42









 








          (b) Mandatory. (i) The Letter of Credit Facility shall be permanently reduced from
time to time on the date of each reduction in the Revolving Credit Facility by the amount, if any,
by which the amount of the Letter of Credit Facility exceeds the Revolving Credit Facility after
giving effect to such reduction of the Revolving Credit Facility.





     (ii) The Swing Line Facility shall be permanently reduced from time to time on the date
of each reduction in the Revolving Credit Facility by the amount, if any, by which the
amount of the Swing Line Facility exceeds the Revolving Credit Facility after giving effect
to such reduction of the Revolving Credit Facility.



          SECTION 2.06. Prepayments. (a) Optional. The Borrower may, upon same day notice in the
case of Base Rate Advances and two Business Days’ notice in the case of Eurodollar Rate Advances,
in each case to the Administrative Agent stating the proposed date and aggregate principal amount
of the prepayment, and if such notice is given the Borrower shall, prepay the outstanding aggregate
principal amount of the Advances comprising part of the same Borrowing in whole or ratably in part,
together with accrued interest to the date of such prepayment on the aggregate principal amount
prepaid; provided, however, that (i) each partial prepayment shall be in an aggregate principal
amount of $1,000,000 or an integral multiple of $250,000 in excess thereof or, if less, the amount
of the Advances outstanding and (ii) if any prepayment of a Eurodollar Rate Advance is made on a
date other than the last day of an Interest Period for such Advance, the Borrower shall also pay
any amounts owing pursuant to Section 9.04(c).




          (b) Mandatory. (i) The Borrower shall, on each Business Day, prepay an aggregate
principal amount of the Revolving Credit Advances comprising part of the same Borrowings, the Swing
Line Advances and the Letter of Credit Advances and, to the extent all Advances have been prepaid,
make a deposit in the L/C Cash Collateral Account in an amount sufficient to cause (A) the Facility
Exposure not to exceed the lesser of the Revolving Credit Facility and the Total Borrowing Base
Value on such Business Day, (B) the Leverage Ratio not to exceed the applicable maximum Leverage
Ratio set forth in Section 5.04(a)(i) on such Business Day, and (C) the Facility Exposure not to
exceed the Total Borrowing Base Value as set forth in Section 5.04(b)(i) on such Business Day.





     (ii) The Borrower shall, on each Business Day, pay to the Administrative Agent for
deposit in the L/C Cash Collateral Account an amount sufficient to cause the aggregate
amount on deposit in the L/C Cash Collateral Account to equal the amount by which the
aggregate Available Amount of all Letters of Credit then outstanding exceeds the Letter of
Credit Facility on such Business Day. To the extent the funds on deposit in the L/C Cash
Collateral Account shall at any time exceed the total amount required to be deposited
therein pursuant to the terms of this Agreement, the Administrative Agent shall, promptly
upon request by the Borrower and provided that no Default or Event of Default shall then
have occurred or be continuing or would result therefrom, return such excess amount to the
Borrower.




     (iii) Prepayments of the Revolving Credit Facility made pursuant to clause (i) above
shall be first applied to prepay Letter of Credit Advances then outstanding until such
Advances are paid in full, second applied to prepay Swing Line Advances then



43









 







outstanding until such Advances are paid in full, third applied to prepay Revolving
Credit Advances then outstanding comprising part of the same Borrowings until such Advances
are paid in full and fourth deposited in the L/C Cash Collateral Account to cash
collateralize 100% of the Available Amount of the Letters of Credit then outstanding. Upon
the drawing of any Letter of Credit for which funds are on deposit in the L/C Cash
Collateral Account, such funds shall be applied to reimburse the relevant Issuing Bank or
Lenders, as applicable.




     (iv) All prepayments under this subsection (b) shall be made together with accrued
interest to the date of such prepayment on the principal amount prepaid.



          SECTION 2.07. Interest. (a) Scheduled Interest. The Borrower shall pay interest on the
unpaid principal amount of each Advance owing to each Lender from the date of such Advance until
such principal amount shall be paid in full, at the following rates per annum:





     (i) Base Rate Advances. During such periods as such Advance is a Base Rate
Advance, a rate per annum equal at all times to the sum of (A) the Base Rate in effect from
time to time plus (B) the Applicable Margin in respect of Base Rate Advances in effect from
time to time, payable in arrears quarterly on the last day of each March, June, September
and December during such periods and on the date such Base Rate Advance shall be Converted
or paid in full.




     (ii) Eurodollar Rate Advances. During such periods as such Advance is a
Eurodollar Rate Advance, a rate per annum equal at all times during each Interest Period for
such Advance to the sum of (A) the Eurodollar Rate for such Interest Period for such Advance
plus (B) the Applicable Margin in respect of Eurodollar Rate Advances in effect on the first
day of such Interest Period, payable in arrears on the last day of such Interest Period and,
if such Interest Period has a duration of more than three months, on each day that occurs
during such Interest Period every three months from the first day of such Interest Period
and on the date such Eurodollar Rate Advance shall be Converted or paid in full.



          (b) Default Interest. Upon the occurrence and during the continuance of any Event of
Default, the Borrower shall pay interest on (i) the unpaid principal amount of each Advance owing
to each Lender, payable in arrears on the dates referred to in clause (a)(i) or (a)(ii) above and
on demand, at a rate per annum equal at all times to 2% per annum above the rate per annum required
to be paid on such Advance pursuant to clause (a)(i) or (a)(ii) above and (ii) to the fullest
extent permitted by law, the amount of any interest, fee or other amount payable under the Loan
Documents that is not paid when due, from the date such amount shall be due until such amount shall
be paid in full, payable in arrears on the date such amount shall be paid in full and on demand, at
a rate per annum equal at all times to 2% per annum above the rate per annum required to be paid,
in the case of interest, on the Type of Advance on which such interest has accrued pursuant to
clause (a)(i) or (a)(ii) above and, in all other cases, on Base Rate Advances pursuant to
clause (a)(i) above.




          (c) Notice of Interest Period and Interest Rate. Each continuation of a Eurodollar
Rate Advance shall be made upon the Borrower’s irrevocable notice received by the






44









 







Administrative Agent, which may be given by telephone, including a specification of the
duration of the Interest Period with respect thereto. Each such notice must be received by the
Administrative Agent not later than 12:00 Noon (New York City time) three Business Days prior to
the first day of the subsequent Interest Period for the continuation of such Eurodollar Rate
Advance. Each telephonic notice by the Borrower pursuant to this Section 2.07(c) must be confirmed
promptly by delivery to the Administrative Agent of a written notice, appropriately completed and
signed by a Responsible Officer of the Borrower. Promptly after receipt of a Notice of Borrowing
pursuant to Section 2.02(a), a notice of Conversion pursuant to Section 2.09, a notice of
continuation of a Eurodollar Rate Advance pursuant to this subsection (c) or a notice of selection
of an Interest Period pursuant to the definition of “Interest Period”, the Administrative Agent
shall give notice to the Borrower and each Lender of the applicable Interest Period and the
applicable interest rate determined by the Administrative Agent for purposes of clause (a)(i) or
(a)(ii) above, and the applicable rate, if any, furnished by each Reference Bank for the purpose of
determining the applicable interest rate under clause (a)(ii) above.




          (d) Interest Rate Determination. (i) The Reference Bank agrees to furnish to the
Administrative Agent timely information for the purpose of determining each Eurodollar Rate. If
the Reference Bank shall not furnish such timely information to the Administrative Agent for the
purpose of determining any such interest rate, the Administrative Agent shall determine such
interest rate on the basis of timely information obtained by the Administrative Agent in its sole
reasonable discretion.





     (ii) If the Reuters Screen LIBOR01 Page (or a successor page) is unavailable and the
Administrative Agent is unable to determine the Eurodollar Rate for any Eurodollar Rate
Advances,




     (A) the Administrative Agent shall forthwith notify the Borrower and the
Lenders that the interest rate cannot be determined for such Eurodollar Rate
Advances,




     (B) each such Advance will automatically, on the last day of the then existing
Interest Period therefor, Convert into a Base Rate Advance (or if such Advance is
then a Base Rate Advance, will continue as a Base Rate Advance), and




     (C) the obligation of the Lenders to make, or to Convert Advances into,
Eurodollar Rate Advances shall be suspended until the Administrative Agent shall
notify the Borrower and the Lenders that the circumstances causing such suspension
no longer exist.



          SECTION 2.08. Fees. (a) Unused Fee. The Borrower shall pay to the Administrative Agent
for the account of the Lenders an unused commitment fee (the “Unused Fee”), from the date hereof in
the case of each Initial Lender and from the effective date specified in the Assignment and
Acceptance or the Accession Agreement, as the case may be, pursuant to which it became a Lender in
the case of each other Lender until the Termination Date, payable in arrears quarterly on the last
day of each March, June, September and December,






45









 







commencing September 30, 2010, and on the Termination Date. The Unused Fee payable for the
account of each Lender shall be calculated for each period for which the Unused Fee is payable on
the average daily Unused Revolving Credit Commitment of such Lender during such period at the rate
of 0.40% per annum.




          (b) Letter of Credit Fees, Etc. (i) The Borrower shall pay to the Administrative
Agent for the account of each Lender a commission, payable in arrears, (a) quarterly on the last
day of each March, June, September and December commencing September 30, 2010, (b) on the earliest
to occur of the full drawing, expiration, termination or cancellation of any Letter of Credit, and
(c) on the Termination Date, on such Lender’s Pro Rata Share of the average daily aggregate
Available Amount during such quarter of all Letters of Credit outstanding from time to time for the
applicable period at the rate per annum equal to the Applicable Margin for Eurodollar Rate Advances
in effect from time to time.





     (ii) The Borrower shall pay to each Issuing Bank, for its own account, (A) a fronting
fee for each Letter of Credit issued by such Issuing Bank in an amount equal to 0.125% of
the Available Amount of such Letter of Credit on the date of issuance of such Letter of
Credit, payable on such date and (B) such other commissions, issuance fees, transfer fees
and other fees and charges in connection with the issuance or administration of each Letter
of Credit as the Borrower and such Issuing Bank shall agree.



          (c) Other Fees. The Borrower shall pay to each of Agent and Arranger for its own
account the fees, in the amounts and on the dates, set forth in the Fee Letter and such other fees
as may from time to time be agreed between the Borrower and Agent or Arranger.




          (d) Extension Fee. The Borrower shall pay to the Administrative Agent on the
Extension Date, for the account of each Lender, a Facility extension fee, in an amount equal to
0.50% of each Lender’s Revolving Credit Commitment then outstanding.




          SECTION 2.09. Conversion of Advances. (a) Optional. The Borrower may on any Business Day, upon
notice given to the Administrative Agent not later than 12:00 Noon (New York City time) on the
third Business Day prior to the date of the proposed Conversion and subject to the provisions of
Sections 2.07 and 2.10, Convert all or any portion of the Advances of one Type comprising the same
Borrowing into Advances of the other Type; provided, however, that any Conversion of Eurodollar
Rate Advances into Base Rate Advances shall be made only on the last day of an Interest Period for
such Eurodollar Rate Advances, any Conversion of Base Rate Advances into Eurodollar Rate Advances
shall be in an amount not less than the minimum amount specified in Section 2.02(c), no Conversion
of any Advances shall result in more separate Borrowings than permitted under Section 2.02(c) and
each Conversion of Advances comprising part of the same Borrowing under any Facility shall be made
ratably among the Lenders in accordance with their Commitments under such Facility. Each such
notice of Conversion shall, within the restrictions specified above, specify (i) the date of such
Conversion, (ii) the Advances to be Converted and (iii) if such Conversion is into Eurodollar Rate
Advances, the duration of the initial Interest Period for such Advances. Each notice of Conversion
shall be irrevocable and binding on the Borrower.





46











 





          (b) Mandatory. (a) On the date on which the aggregate unpaid principal amount of
Eurodollar Rate Advances comprising any Borrowing shall be reduced, by payment or prepayment or
otherwise, to less than $1,000,000, such Advances shall automatically Convert into Base Rate
Advances.




     (i) If the Borrower shall fail to select the duration of any Interest Period for any
Eurodollar Rate Advances in accordance with the provisions contained in the definition of
“Interest Period” in Section 1.01, the Administrative Agent will forthwith so notify the
Borrower and the Lenders, whereupon each such Eurodollar Rate Advance will automatically, on
the last day of the then existing Interest Period therefor, Convert into a Base Rate
Advance.




     (ii) Upon the occurrence and during the continuance of any Event of Default, (y) each
Eurodollar Rate Advance will automatically, on the last day of the then existing Interest
Period therefor, Convert into a Base Rate Advance and (z) the obligation of the Lenders to
make, or to Convert Advances into, Eurodollar Rate Advances shall be suspended.



          SECTION 2.10. Increased Costs, Etc. (a) If, due to either (i) the introduction of or
any change in or in the interpretation of any law or regulation or (ii) the compliance with any
guideline or request from any central bank or other governmental authority (whether or not having
the force of law), there shall be any increase in the cost to any Lender Party of agreeing to make
or of making, funding or maintaining Eurodollar Rate Advances or of agreeing to issue or of issuing
or maintaining or participating in Letters of Credit or of agreeing to make or of making or
maintaining Letter of Credit Advances (excluding, for purposes of this Section 2.10, any such
increased costs resulting from (y) Taxes or Other Taxes (as to which Section 2.12 shall govern) and
(z) changes in the basis of taxation of overall net income or overall gross income by the United
States or by the foreign jurisdiction or state under the laws of which such Lender Party is
organized or has its Applicable Lending Office or any political subdivision thereof), then the
Borrower shall from time to time, upon demand by such Lender Party (with a copy of such demand to
the Administrative Agent), pay to the Administrative Agent for the account of such Lender Party
additional amounts sufficient to compensate such Lender Party for such increased cost; provided,
however, that a Lender Party claiming additional amounts under this Section 2.10(a) agrees to use
reasonable efforts (consistent with its internal policy and legal and regulatory restrictions) to
designate a different Applicable Lending Office if the making of such a designation would avoid the
need for, or reduce the amount of, such increased cost that may thereafter accrue and would not, in
the reasonable judgment of such Lender Party, be otherwise disadvantageous to such Lender Party. A
certificate as to the amount of such increased cost, submitted to the Borrower by such Lender
Party, shall be conclusive and binding for all purposes, absent manifest error.



          (b) If any Lender Party determines that compliance with any law or regulation or any guideline
or request from any central bank or other governmental authority (whether or not having the force
of law) affects or would affect the amount of capital required or expected to be maintained by such
Lender Party or any corporation controlling such Lender Party and that the amount of such capital
is increased by or based upon the existence of such Lender Party’s commitment to lend or to issue
or participate in Letters of Credit hereunder and other



47









 





commitments of such type or the issuance or maintenance of or participation in the Letters of
Credit (or similar contingent obligations), then, upon demand by such Lender Party or such
corporation (with a copy of such demand to the Administrative Agent), the Borrower shall pay to the
Administrative Agent for the account of such Lender Party, from time to time as specified by such
Lender Party, additional amounts sufficient to compensate such Lender Party in the light of such
circumstances, to the extent that such Lender Party reasonably determines such increase in capital
to be allocable to the existence of such Lender Party’s commitment to lend or to issue or
participate in Letters of Credit hereunder or to the issuance or maintenance of or participation in
any Letters of Credit. A certificate as to such amounts submitted to the Borrower by such Lender
Party shall be conclusive and binding for all purposes, absent manifest error.




          (c) If, with respect to any Eurodollar Rate Advances, the Required Lenders notify the
Administrative Agent that the Eurodollar Rate for any Interest Period for such Advances will not
adequately reflect the cost to such Lenders of making, funding or maintaining their Eurodollar Rate
Advances for such Interest Period, the Administrative Agent shall forthwith so notify the Borrower
and the Lenders, whereupon (i) each such Eurodollar Rate Advance will automatically, on the last
day of the then existing Interest Period therefor, Convert into a Base Rate Advance and (ii) the
obligation of the Lenders to make, or to Convert Advances into, Eurodollar Rate Advances shall be
suspended until the Administrative Agent shall notify the Borrower that such Lenders have
determined that the circumstances causing such suspension no longer exist.



          (d) Notwithstanding any other provision of this Agreement, if the introduction of or any
change in or in the interpretation of any law or regulation shall make it unlawful, or any central
bank or other governmental authority shall assert that it is unlawful, for any Lender or its
Eurodollar Lending Office to perform its obligations hereunder to make Eurodollar Rate Advances or
to continue to fund or maintain Eurodollar Rate Advances hereunder, then, on notice thereof and
demand therefor by such Lender to the Borrower through the Administrative Agent, (i) each
Eurodollar Rate Advance will automatically, upon such demand, Convert into a Base Rate Advance and
(ii) the obligation of the Lenders to make, or to Convert Advances into, Eurodollar Rate Advances
shall be suspended until the Administrative Agent shall notify the Borrower that such Lender has
determined that the circumstances causing such suspension no longer exist; provided, however, that,
before making any such demand, such Lender agrees to use reasonable efforts (consistent with its
internal policy and legal and regulatory restrictions) to designate a different Eurodollar Lending
Office if the making of such a designation would allow such Lender or its Eurodollar Lending Office
to continue to perform its obligations to make Eurodollar Rate Advances or to continue to fund or
maintain Eurodollar Rate Advances and would not, in the judgment of such Lender, be otherwise
disadvantageous to such Lender.



          SECTION 2.11. Payments and Computations. (a) The Borrower shall make each payment
hereunder and under the Notes, irrespective of any right of counterclaim or set-off (except as
otherwise provided in Section 2.13), not later than 12:00 Noon (New York City time) on the day when
due in U.S. dollars to the Administrative Agent at the Administrative Agent’s Account in same day
funds, with payments being received by the Administrative Agent after such time being deemed to
have been received on the next succeeding Business Day. The Administrative Agent shall promptly
thereafter cause like funds to be distributed (i) if such payment by the Borrower is in respect of
principal, interest, commitment fees or any other



48









 





Obligation then payable hereunder and under the Notes to more than one Lender Party, to such
Lender Parties for the account of their respective Applicable Lending Offices ratably in accordance
with the amounts of such respective Obligations then payable to such Lender Parties and (ii) if
such payment by the Borrower is in respect of any Obligation then payable hereunder to one Lender
Party, to such Lender Party for the account of its Applicable Lending Office, in each case to be
applied in accordance with the terms of this Agreement. Upon any Acceding Lender becoming a Lender
hereunder as a result of a Commitment Increase pursuant to Section 2.17 and upon the Administrative
Agent’s receipt of such Lender’s Accession Agreement and recording of information contained therein
in the Register, from and after the applicable Increase Date, the Administrative Agent shall make
all payments hereunder and under any Notes issued in connection therewith in respect of the
interest assumed thereby to such Acceding Lender. Upon its acceptance of an Assignment and
Acceptance and recording of the information contained therein in the Register pursuant to
Section 9.07(d), from and after the effective date of such Assignment and Acceptance, the
Administrative Agent shall make all payments hereunder and under the Notes in respect of the
interest assigned thereby to the Lender Party assignee thereunder, and the parties to such
Assignment and Acceptance shall make all appropriate adjustments in such payments for periods prior
to such effective date directly between themselves.




          (b) The Borrower hereby authorizes each Lender Party and each of its Affiliates, if and to the
extent payment owed to such Lender Party is not made when due hereunder or, in the case of a
Lender, under the Note held by such Lender, to charge from time to time, to the fullest extent
permitted by law, against any or all of the Borrower’s accounts with such Lender Party any amount
so due.



          (c) All computations of interest based on the Base Rate shall be made by the Administrative
Agent on the basis of a year of 365 or 366 days, as the case may be, and all computations of
interest based on the Eurodollar Rate or the Federal Funds Rate and of fees and Letter of Credit
commissions shall be made by the Administrative Agent on the basis of a year of 360 days, in each
case for the actual number of days (including the first day but excluding the last day) occurring
in the period for which such interest, fees or commissions are payable. Each determination by the
Administrative Agent of an interest rate, fee or commission hereunder shall be conclusive and
binding for all purposes, absent manifest error.



          (d) Whenever any payment hereunder or under the Notes shall be stated to be due on a day other
than a Business Day, such payment shall be made on the next succeeding Business Day, and such
extension of time shall in such case be included in the computation of payment of interest or
commitment fee, as the case may be; provided, however, that if such extension would cause payment
of interest on or principal of Eurodollar Rate Advances to be made in the next following calendar
month, such payment shall be made on the next preceding Business Day.



          (e) Unless the Administrative Agent shall have received notice from the Borrower prior to the
date on which any payment is due to any Lender Party hereunder that the Borrower will not make such
payment in full, the Administrative Agent may assume that the Borrower has made such payment in
full to the Administrative Agent on such date and the Administrative Agent may, in reliance upon
such assumption, cause to be distributed to each



49









 





such Lender Party on such due date an amount equal to the amount then due such Lender Party.
If and to the extent the Borrower shall not have so made such payment in full to the Administrative
Agent, each such Lender Party shall repay to the Administrative Agent forthwith on demand such
amount distributed to such Lender Party together with interest thereon, for each day from the date
such amount is distributed to such Lender Party until the date such Lender Party repays such amount
to the Administrative Agent, at the Federal Funds Rate.




          (f) Whenever any payment received by the Administrative Agent under this Agreement or any of
the other Loan Documents is insufficient to pay in full all amounts due and payable to the Agents
and the Lender Parties under or in respect of this Agreement and the other Loan Documents on any
date, such payment shall be distributed by the Administrative Agent and applied by the Agents and
the Lender Parties in the following order of priority:




     (i) first, to the payment of all of the fees, indemnification payments, costs and
expenses that are due and payable to the Agents (solely in their respective capacities as
Agents) under or in respect of this Agreement and the other Loan Documents on such date,
ratably based upon the respective aggregate amounts of all such fees, indemnification
payments, costs and expenses owing to the Agents on such date;




     (ii) second, to the payment of all of the fees, indemnification payments, costs and
expenses that are due and payable to the Issuing Banks (solely in their respective
capacities as such) under or in respect of this Agreement and the other Loan Documents on
such date, ratably based upon the respective aggregate amounts of all such fees,
indemnification payments, costs and expenses owing to the Issuing Banks on such date;




     (iii) third, to the payment of all of the indemnification payments, costs and expenses
that are due and payable to the Lenders under Section 9.04, Section 21 of the Security
Agreement and any similar section of any of the other Loan Documents on such date, ratably
based upon the respective aggregate amounts of all such indemnification payments, costs and
expenses owing to the Lenders on such date;




     (iv) fourth, to the payment of all of the amounts that are due and payable to the
Administrative Agent and the Lender Parties under Sections 2.10 and 2.12 on such date,
ratably based upon the respective aggregate amounts thereof owing to the Administrative
Agent and the Lender Parties on such date;




     (v) fifth, to the payment of all of the fees that are due and payable to the Lenders
under Section 2.08(a), (b)(i) and (e) on such date, ratably based upon the respective
aggregate Commitments of the Lenders under the Facilities on such date;




     (vi) sixth, to the payment of all of the accrued and unpaid interest on the Obligations
of the Borrower under or in respect of the Loan Documents that is due and payable to the
Administrative Agent and the Lender Parties under Section 2.07(b) on such date, ratably
based upon the respective aggregate amounts of all such interest owing to the Administrative
Agent and the Lender Parties on such date;




     (vii) seventh, to the payment of all of the accrued and unpaid interest on the Advances
that is due and payable to the Administrative Agent and the Lender Parties



50









 







under Section 2.07(a) on such date, ratably based upon the respective aggregate amounts
of all such interest owing to the Administrative Agent and the Lender Parties on such date;




     (viii) eighth, to the payment of any other accrued and unpaid interest comprising
Obligations that is due and payable to the Administrative Agent and the Lender Parties on
such date, ratably based upon the respective aggregate amounts of all such interest owing to
the Administrative Agent and the Lender Parties on such date;




     (ix) ninth, to the payment of the principal amount of all of the outstanding Advances
that are due and payable to the Administrative Agent and the Lender Parties on such date,
ratably based upon the respective aggregate amounts of all such principal and reimbursement
obligations owing to the Administrative Agent and the Lender Parties on such date, and to
deposit into the L/C Cash Collateral Account any contingent reimbursement obligations in
respect of outstanding Letters of Credit to the extent required by Section 6.02; and




     (x) tenth, to the payment of all other Obligations of the Loan Parties owing under or
in respect of the Loan Documents that are due and payable to the Administrative Agent and
the other Secured Parties on such date, ratably based upon the respective aggregate amounts
of all such Obligations owing to the Administrative Agent and the other Secured Parties on
such date.



          SECTION 2.12. Taxes. (a) Any and all payments by any Loan Party to or for the
account of any Lender Party or any Agent hereunder or under any other Loan Document shall be made,
in accordance with Section 2.11 or the applicable provisions of such other Loan Document, if any,
free and clear of and without deduction for any and all present or future taxes, levies, imposts,
deductions, charges or withholdings, and all liabilities with respect thereto, excluding, in the
case of each Lender Party and each Agent, taxes that are imposed on its overall net income by the
United States and taxes that are imposed on its overall net income (and franchise taxes imposed in
lieu thereof) by the state or foreign jurisdiction under the laws of which such Lender Party or
such Agent, as the case may be, is organized or any political subdivision thereof and, in the case
of each Lender Party, taxes that are imposed on its overall net income (and franchise taxes imposed
in lieu thereof) by the state or foreign jurisdiction of such Lender Party’s Applicable Lending
Office or any political subdivision thereof (all such non-excluded taxes, levies, imposts,
deductions, charges, withholdings and liabilities in respect of payments hereunder or under any
other Loan Document being hereinafter referred to as “Taxes”). If any Loan Party shall be required
by law to deduct any Taxes from or in respect of any sum payable hereunder or under any other Loan
Document to any Lender Party or any Agent, and unless such requirement arises from the failure of a
Lender to furnish the documentation described in Section 2.12(e), (i) the sum payable by such Loan
Party shall be increased as may be necessary so that after such Loan Party and any Agent have made
all required deductions (including deductions applicable to additional sums payable under this
Section 2.12) such Lender Party or such Agent, as the case may be, receives an amount equal to the
sum it would have received had no such deductions been made, (ii) such Loan Party shall make all
such deductions and (iii) such Loan Party shall pay the full amount deducted to the relevant
taxation authority or other authority in accordance with applicable law.



51









 





          (b) In addition, each Loan Party shall pay any present or future stamp, documentary, excise,
property, intangible, mortgage recording or similar taxes, charges or levies that arise from any
payment made by such Loan Party hereunder or under any other Loan Documents or from the execution,
delivery or registration of, performance under, or otherwise with respect to, this Agreement, or
the other Loan Documents (hereinafter referred to as “Other Taxes”).



          (c) The Loan Parties shall indemnify each Lender Party and each Agent for and hold them
harmless against the full amount of Taxes and Other Taxes, and for the full amount of taxes of any
kind imposed or asserted by any jurisdiction on amounts payable by the Loan Parties under this
Section 2.12, imposed on or paid by such Lender Party or such Agent (as the case may be) and any
liability (including penalties, additions to tax, interest and expenses) arising therefrom or with
respect thereto. This indemnification shall be made within 30 days from the date such Lender Party
or such Agent (as the case may be) makes written demand therefor.



          (d) Within 30 days after the date of any payment of Taxes, the appropriate Loan Party shall
furnish to the Administrative Agent, at its address referred to in Section 9.02, the original or a
certified copy of a receipt evidencing such payment, to the extent such receipt is issued therefor,
or other evidence of payment thereof reasonably satisfactory to the Administrative Agent. In the
case of any payment hereunder or under the other Loan Documents by or on behalf of a Loan Party
through an account or branch outside the United States or by or on behalf of a Loan Party by a
payor that is not a United States person, if such Loan Party determines that no Taxes are payable
in respect thereof, such Loan Party shall furnish, or shall cause such payor to furnish, to the
Administrative Agent, at such address, an opinion of counsel acceptable to the Administrative Agent
stating that such payment is exempt from Taxes. For purposes of subsections (d) and (e) of this
Section 2.12, the terms “United States” and “United States person” shall have the meanings
specified in Section 7701 of the Internal Revenue Code.



          (e) Each Lender Party organized under the laws of a jurisdiction outside the United States
shall, on or prior to the date of its execution and delivery of this Agreement in the case of each
Initial Lender Party, and on the date of the Assignment and Acceptance pursuant to which it becomes
a Lender Party in the case of each other Lender Party, and from time to time thereafter as
reasonably requested in writing by the Borrower (but only so long thereafter as such Lender Party
remains lawfully able to do so), provide each of the Administrative Agent and the Borrower with two
original Internal Revenue Service Forms W-8BEN or W-8EC1, as appropriate, or any successor or other
form prescribed by the Internal Revenue Service, certifying that such Lender Party is exempt from
or entitled to a reduced rate of United States withholding tax on payments pursuant to this
Agreement or any other Loan Document. If the forms provided by a Lender Party at the time such
Lender Party first becomes a party to this Agreement indicate a United States interest withholding
tax rate in excess of zero, withholding tax at such rate shall be considered excluded from Taxes
unless and until such Lender Party provides the appropriate forms certifying that a lesser rate
applies, whereupon withholding tax at such lesser rate only shall be considered excluded from Taxes
for periods governed by such forms; provided, however, that if, at the effective date of the
Assignment and Acceptance pursuant to which a Lender Party becomes a party to this Agreement, the
Lender Party assignor was entitled to payments under subsection (a) of this Section 2.12 in respect
of United States



52









 





withholding tax with respect to interest paid at such date, then, to such extent, the term
Taxes shall include (in addition to withholding taxes that may be imposed in the future or other
amounts otherwise includable in Taxes) United States withholding tax, if any, applicable with
respect to the Lender Party assignee on such date. If any form or document referred to in this
subsection (e) requires the disclosure of information, other than information necessary to compute
the tax payable and information required on the date hereof by Internal Revenue Service form W-8BEN
or W-8EC1, that the applicable Lender Party reasonably considers to be confidential, such Lender
Party shall give notice thereof to the Borrower and shall not be obligated to include in such form
or document such confidential information. Upon the request of the Borrower, any Lender that is a
United States person and is not an exempt recipient for U.S. backup withholding purposes shall
deliver to the Borrower two copies of Internal Revenue Service form W-9 (or any successor form).




          (f) For any period with respect to which a Lender Party has failed to provide the Borrower
with the appropriate form or other document described in subsection (e) above (other than if such
failure is due to a change in law, or in the interpretation or application thereof, occurring after
the date on which a form or other document originally was required to be provided or if such form
or other document otherwise is not required under subsection (e) above), such Lender Party shall
not be entitled to indemnification under subsection (a) or (c) of this Section 2.12 with respect to
Taxes imposed by the United States by reason of such failure; provided, however, that should a
Lender Party become subject to Taxes because of its failure to deliver a form or other document
required hereunder, the Loan Parties shall take such steps as such Lender Party shall reasonably
request to assist such Lender Party to recover such Taxes.



          (g) Any Lender Party claiming any additional amounts payable pursuant to this Section 2.12
agrees to use reasonable efforts (consistent with its internal policy and legal and regulatory
restrictions) to change the jurisdiction of its Eurodollar Lending Office if the making of such a
change would avoid the need for, or reduce the amount of, any such additional amounts that may
thereafter accrue and would not, in the reasonable judgment of such Lender Party, be otherwise
disadvantageous to such Lender Party.



          (h) In the event that an additional payment is made under Section 2.12(a) or (c) for the
account of any Lender Party and such Lender Party, in its sole discretion, determines that it has
finally and irrevocably received or been granted a credit against or release or remission for, or
repayment of, any tax paid or payable by it in respect of or calculated with reference to the
deduction or withholding giving rise to such payment, such Lender Party shall, to the extent that
it determines that it can do so without prejudice to the retention of the amount of such credit,
relief, remission or repayment, pay to the applicable Loan Party such amount as such Lender Party
shall, in its sole discretion, have determined to be attributable to such deduction or withholding
and which will leave such Lender Party (after such payment) in no worse position than it would have
been in if the applicable Loan Party had not been required to make such deduction or withholding.
Nothing herein contained shall interfere with the right of a Lender Party to arrange its tax
affairs in whatever manner it thinks fit nor oblige any Lender Party to claim any tax credit or to
disclose any information relating to its affairs or any computations in respect thereof, and no
Loan Party shall be entitled to review the tax records of any Lender Party or the Administrative
Agent, or require any Lender Party to do anything that would prejudice its



53









 





ability to benefit from any other credits, reliefs, remissions or repayments to which it may
be entitled.




          SECTION 2.13. Sharing of Payments, Etc. Subject to the provisions of Section 2.11(f),
if any Lender Party shall obtain at any time any payment (whether voluntary, involuntary, through
the exercise of any right of set off, or otherwise, other than as a result of an assignment
pursuant to Section 9.07) (a) on account of Obligations due and payable to such Lender Party
hereunder and under the Notes at such time in excess of its ratable share (according to the
proportion of (i) the amount of such Obligations due and payable to such Lender Party at such time
to (ii) the aggregate amount of the Obligations due and payable to all Lender Parties hereunder and
under the Notes at such time) of payments on account of the Obligations due and payable to all
Lender Parties hereunder and under the Notes at such time obtained by all the Lender Parties at
such time or (b) on account of Obligations owing (but not due and payable) to such Lender Party
hereunder and under the Notes at such time in excess of its ratable share (according to the
proportion of (i) the amount of such Obligations owing to such Lender Party at such time to
(ii) the aggregate amount of the Obligations owing (but not due and payable) to all Lender Parties
hereunder and under the Notes at such time) of payments on account of the Obligations owing (but
not due and payable) to all Lender Parties hereunder and under the Notes at such time obtained by
all of the Lender Parties at such time, such Lender Party shall forthwith purchase from the other
Lender Parties such interests or participating interests in the Obligations due and payable or
owing to them, as the case may be, as shall be necessary to cause such purchasing Lender Party to
share the excess payment ratably with each of them; provided, however, that if all or any portion
of such excess payment is thereafter recovered from such purchasing Lender Party, such purchase
from each other Lender Party shall be rescinded and such other Lender Party shall repay to the
purchasing Lender Party the purchase price to the extent of such Lender Party’s ratable share
(according to the proportion of (i) the purchase price paid to such Lender Party to (ii) the
aggregate purchase price paid to all Lender Parties) of such recovery together with an amount equal
to such Lender Party’s ratable share (according to the proportion of (i) the amount of such other
Lender Party’s required repayment to (ii) the total amount so recovered from the purchasing Lender
Party) of any interest or other amount paid or payable by the purchasing Lender Party in respect of
the total amount so recovered. The Borrower agrees that any Lender Party so purchasing an interest
or participating interest from another Lender Party pursuant to this Section 2.13 may, to the
fullest extent permitted by law, exercise all its rights of payment (including the right of
set-off) with respect to such interest or participating interest, as the case may be, as fully as
if such Lender Party were the direct creditor of the Borrower in the amount of such interest or
participating interest, as the case may be.



          SECTION 2.14. Use of Proceeds. The proceeds of the Advances and issuances of Letters
of Credit shall be available (and the Borrower agrees that it shall use such proceeds and Letters
of Credit) solely for (i) general corporate purposes of the Borrower and its Subsidiaries, (ii) the
development of new, and the renovation and expansion of existing, Campus Housing Assets and the
acquisition of such other assets and the making of such other Investments as are permitted by this
Agreement, (iii) the acquisition of land and/or improvements for the sole purpose of converting
such properties into Campus Housing Assets, (iv) the repayment in full (or refinancing) of existing
mortgage loans affecting Borrowing Base Assets, (v) the payment of fees and expenses related to the
Facilities and the other transactions



54









 





contemplated by the Loan Documents and (vi) the payment of fees and expenses related to the
IPO and the Formation Transactions.




          SECTION 2.15. Evidence of Debt. (a) Each Lender Party shall maintain in accordance
with its usual practice an account or accounts evidencing the indebtedness of the Borrower to such
Lender Party resulting from each Advance owing to such Lender Party from time to time, including
the amounts of principal and interest payable and paid to such Lender Party from time to time
hereunder. The Borrower agrees that upon notice by any Lender Party to the Borrower (with a copy
of such notice to the Administrative Agent) to the effect that a promissory note or other evidence
of indebtedness is required or appropriate in order for such Lender Party to evidence (whether for
purposes of pledge, enforcement or otherwise) the Advances owing to, or to be made by, such Lender
Party, the Borrower shall promptly execute and deliver to such Lender Party, with a copy to the
Administrative Agent, a Note, in substantially the form of Exhibit A hereto, payable to the order
of such Lender Party in a principal amount equal to the Revolving Credit Commitment of such Lender
Party. All references to Notes in the Loan Documents shall mean Notes, if any, to the extent
issued hereunder. To the extent no Note has been issued to a Lender Party, this Agreement shall be
deemed to comprise conclusive evidence for all purposes of the indebtedness resulting from the
Advances and extensions of credit hereunder.



          (b) The Register maintained by the Administrative Agent pursuant to Section 9.07(d) shall
include a control account, and a subsidiary account for each Lender Party, in which accounts (taken
together) shall be recorded (i) the date and amount of each Borrowing made hereunder, the Type of
Advances comprising such Borrowing and, if appropriate, the Interest Period applicable thereto,
(ii) the terms of each Assignment and Acceptance delivered to and accepted by it, (iii) the amount
of any principal or interest due and payable or to become due and payable from the Borrower to each
Lender Party hereunder, and (iv) the amount of any sum received by the Administrative Agent from
the Borrower hereunder and each Lender Party’s share thereof.



          (c) Entries made in good faith by the Administrative Agent in the Register pursuant to
subsection (b) above, and by each Lender Party in its account or accounts pursuant to
subsection (a) above, shall be prima facie evidence of the amount of principal and interest due and
payable or to become due and payable from the Borrower to, in the case of the Register, each Lender
Party and, in the case of such account or accounts, such Lender Party, under this Agreement, absent
manifest error; provided, however, that the failure of the Administrative Agent or such Lender
Party to make an entry, or any finding that an entry is incorrect, in the Register or such account
or accounts shall not limit or otherwise affect the obligations of the Borrower under this
Agreement.



          SECTION 2.16. Extension of Termination Date. At least 30 days but not more than 60
days prior to the Termination Date, the Borrower, by written notice to the Administrative Agent,
may request, with respect to the Commitments then outstanding, a single one-year extension of the
Termination Date. The Administrative Agent shall promptly notify each Lender of such request and
the Termination Date in effect at such time shall, effective as at the Termination Date (the
“Extension Date”), be extended for an additional one year period, provided that (i) the
Administrative Agent shall have received not later than 30 days prior to the



55









 





Termination Date a new Appraisal of each Borrowing Base Asset, (ii) the Borrower shall have
paid the Extension Fees as described in Section 2.08(d) and (iii) on the Extension Date the
following statements shall be true and the Administrative Agent shall have received for the account
of each Lender Party a certificate signed by a Responsible Officer of the Borrower, dated the
Extension Date, stating that: (a) the representations and warranties contained in Section 4.01 are
true and correct in all material respects on and as of the Extension Date (except to the extent
that such representations and warranties specifically refer to an earlier date, in which case they
are true and correct as of such earlier date), and (b) no Default or Event of Default has occurred
and is continuing or would result from such extension. In the event that an extension is effected
pursuant to this Section 2.16 (but subject to the provisions of Sections 2.05, 2.06 and 6.01), the
aggregate principal amount of all Advances shall be repaid in full ratably to the Lenders on the
Termination Date as so extended. As of the Extension Date, any and all references in this
Agreement, the Notes, if any, or any of the other Loan Documents to the “Termination Date” shall
refer to the Termination Date as so extended.




          SECTION 2.17. Increase in the Aggregate Commitments. (a) The Borrower may, at any
time (but no more than twice in any consecutive 12-month period), by written notice to the
Administrative Agent, request an increase in the aggregate amount of the Revolving Credit
Commitments by not less than $5,000,000 (each such proposed increase, a “Commitment Increase”) to
be effective as of a date that is at least 90 days prior to the scheduled Termination Date then in
effect (the “Increase Date”) as specified in the related notice to the Administrative Agent;
provided, however, that (i) in no event shall the aggregate amount of the Commitments at any time
exceed $200,000,000 and (ii) on the date of any request by the Borrower for a Commitment Increase
and on the related Increase Date, the applicable conditions set forth in Article III shall be
satisfied.



          (b) The Administrative Agent shall promptly notify the Lenders of each request by the Borrower
for a Commitment Increase, which notice shall include (i) the proposed amount of such requested
Commitment Increase, (ii) the proposed Increase Date and (iii) the date by which Lenders wishing to
participate in the Commitment Increase must commit to an increase in the amount of their respective
Commitments (the “Commitment Date”). Each Lender that is willing to participate in such requested
Commitment Increase (each, an “Increasing Lender”) shall, in its sole discretion, give written
notice to the Administrative Agent on or prior to the Commitment Date of the amount by which it is
willing to increase its Commitment (the “Proposed Increased Commitment”). If the Lenders notify
the Administrative Agent that they are willing to increase the amount of their respective
Commitments by an aggregate amount that exceeds the amount of the requested Commitment Increase,
the requested Commitment Increase shall be allocated to each Lender willing to participate therein
in an amount equal to the Commitment Increase multiplied by the ratio of each Lender’s Proposed
Increased Commitment to the aggregate amount of Proposed Increased Commitments.



          (c) Promptly following each Commitment Date, the Administrative Agent shall notify the
Borrower as to the amount, if any, by which the Lenders are willing to participate in the requested
Commitment Increase. If the aggregate amount by which the Lenders are willing to participate in
any requested Commitment Increase on any such Commitment Date is less than the requested Commitment
Increase, then the Borrower may extend offers to one or more Eligible Assignees to participate in
any portion of the requested Commitment Increase that



56









 





has not been committed to by the Lenders as of the applicable Commitment Date; provided,
however, that the Commitment of each such Eligible Assignee shall be in an amount of not less than
$10,000,000.




          (d) On each Increase Date, each Eligible Assignee that accepts an offer to participate in a
requested Commitment Increase in accordance with Section 2.17(c) (an “Acceding Lender”) shall
become a Lender party to this Agreement as of such Increase Date and the Commitment of each
Increasing Lender for such requested Commitment Increase shall be so increased by the amount of its
Proposed Increased Commitment (or by the amount allocated to such Lender pursuant to the last
sentence of Section 2.17(b)) as of such Increase Date; provided, however, that the Administrative
Agent shall have received at or before 12:00 Noon (New York City time) on such Increase Date the
following, each dated such date:




     (i) an accession agreement from each Acceding Lender, if any, in form and substance
satisfactory to the Borrower and the Administrative Agent (each, an “Accession Agreement”),
duly executed by such Acceding Lender, the Administrative Agent and the Borrower;




     (ii) confirmation from each Increasing Lender of the increase in the amount of its
Commitment in a writing satisfactory to the Borrower and the Administrative Agent, together
with an amended Schedule I hereto as may be necessary for such Schedule I to be accurate and
complete, certified as correct and complete by a Responsible Officer of the Borrower; and




     (iii) such certificates or other information as may be required pursuant to
Section 3.02.



On each Increase Date, upon fulfillment of the conditions set forth in the immediately preceding
sentence of this Section 2.17(d), the Administrative Agent shall notify the Lenders (including,
without limitation, each Acceding Lender) and the Borrower, at or before 1:00 P.M. (New York City
time), by telecopier or telex, of the occurrence of the Commitment Increase to be effected on such
Increase Date and shall record in the Register the relevant information with respect to each
Increasing Lender and each Acceding Lender on such date.




          (e) On the Increase Date, to the extent the Advances then outstanding and owed to any Lender
immediately prior to the effectiveness of the Commitment Increase shall be less than such Lender’s
Pro Rata Share (calculated immediately following the effectiveness of the Commitment Increase) of
all Advances then outstanding and owed to all Lenders (each such Lender, including any Acceding
Lender, a “Purchasing Lender”), then such Purchasing Lender, without executing an Assignment and
Acceptance, shall be deemed to have purchased an assignment of a pro rata portion of the Advances
then outstanding and owed to each Lender that is not a Purchasing Lender (a “Selling Lender”) in an
amount sufficient such that following the effectiveness of all such assignments the Advances
outstanding and owed to each Lender shall equal such Lender’s Pro Rata Share (calculated
immediately following the effectiveness of the Commitment Increase on the Increase Date) of all
Advances then outstanding and owed to all Lenders. The Administrative Agent shall calculate the
net amount to be paid by each Purchasing Lender and received by each Selling Lender in connection
with the assignments effected



57









 





hereunder on the Increase Date. Each Purchasing Lender shall make the amount of its required
payment available to the Administrative Agent, in same day funds, at the office of the
Administrative Agent not later than 12:00 P.M. (New York time) on the Increase Date. The
Administrative Agent shall distribute on the Increase Date the proceeds of such amount to each of
the Selling Lenders entitled to receive such payments at its Applicable Lending Office. If in
connection with the transactions described in this Section 2.17 any Lender shall incur any losses,
costs or expenses of the type described in Section 9.04(c), then the Borrower shall, upon demand by
such Lender (with a copy of such demand to the Administrative Agent), pay to the Administrative
Agent for the account of such Lender any amounts required to compensate such Lender for such
losses, costs or expenses incurred in connection therewith.




ARTICLE III

CONDITIONS OF LENDING AND ISSUANCES OF LETTERS OF CREDIT




          SECTION 3.01. Conditions Precedent to the Effectiveness of this Agreement. The
obligation of the Administrative Agent and each Lender Party to execute and deliver this Agreement
and the effectiveness of this Agreement is subject to the satisfaction of the following conditions
precedent before or concurrently with the Closing Date:




     (a) The Administrative Agent shall have received on or before the Closing Date the
following, each dated such day (unless otherwise specified), in form and substance
satisfactory to the Administrative Agent (unless otherwise specified) and (except for the
Notes, as to which one original of each shall be sufficient) in sufficient copies for each
Lender Party:




     (i) A Note duly executed by the Borrower and payable to the order of each
Lender.




     (ii) A security agreement in substantially the form of Exhibit F hereto
(together with each other security agreement and security agreement supplement
delivered pursuant to Section 5.01(j), in each case as amended, the “Security
Agreement”), duly executed by each Loan Party that owns Borrowing Base Assets,
together with:




     (A) copies of proper financing statements, to be duly filed under the
Uniform Commercial Code of all jurisdictions that the Collateral Agent may
deem necessary or desirable in order to perfect and protect the first
priority liens and security interests created under the Collateral
Documents, covering the Collateral described therein,




     (B) completed requests for information dated a recent date, including
UCC, judgment, tax, litigation and bankruptcy searches with respect to each
applicable Loan Party, and, in the case of UCC searches, listing all
effective financing statements filed in the jurisdictions referred to in
clause (A) above and in such other jurisdictions specified by the
Administrative Agent that name any Loan Party as debtor, together with
copies of such financing statements,



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     (C) evidence of the completion of all other recordings and filings of
or with respect to the Security Agreement that the Collateral Agent may deem
necessary or desirable in order to perfect and protect the Liens created
thereby,




     (D) certified copies of the Assigned Agreements referred to in the
Security Agreement (which shall include, without limitation, the Management
Agreement and all amendments thereto with respect to each Borrowing Base
Asset), together with a consent to such assignment, in substantially the
form of Exhibit C to the Security Agreement or otherwise in form and
substance satisfactory to the Administrative Agent, duly executed by each
party to such Assigned Agreements other than the Loan Parties;




     (E) a Manager’s Subordination executed and delivered by the manager of
each Borrowing Base Asset,




     (F) a Hazardous Indemnity Agreement,




     (G) a Pledge Agreement, together with certificated Equity Interests in
each Subsidiary that owns or leases a Borrowing Base Asset and stock powers
and membership interest powers (as the case may be) with respect thereto
executed in blank, all in form and substance acceptable to the
Administrative Agent, and




     (H) evidence that all other action that the Collateral Agent may deem
necessary or desirable in order to perfect and protect the first priority
liens and security interests created under the Security Agreement has been
taken (including, without limitation, receipt of duly executed payoff
letters, UCC termination statements and landlords’ and bailees’ waiver and
consent agreements).




     (iii) Deeds of trust, trust deeds and mortgages in substantially the form of
Exhibit G hereto (together with each other deed of trust, trust deed and mortgage
delivered pursuant to Section 5.01(j), in each case as amended, the “Mortgages”) and
assignments of leases and rents in substantially the form of Exhibit H hereto
(together with each other assignment of leases and rents delivered pursuant to
Section 5.01(j), in each case as amended, the “Assignments of Leases”) (in each case
with such changes as may be required to account for local law matters and otherwise
satisfactory in form and substance to the Collateral Agent) covering all Borrowing
Base Assets, duly executed by the appropriate Loan Party, together with:




     (A) evidence that counterparts of the Mortgages and Assignments of
Leases have been duly executed, acknowledged and delivered on or before the
day of the Initial Extension of Credit and are in form suitable for filing
or recording in all filing or recording offices that



59









 







the Collateral Agent may deem necessary or desirable in order to create
a valid first and subsisting Lien on the collateral described therein in
favor of the Collateral Agent for the benefit of the Secured Parties and
that all required affidavits, tax forms and filings pertaining to any
applicable documentary stamp, intangible and mortgage recordation taxes have
been executed and delivered by all appropriate parties and are in form
suitable for filing with all applicable governmental authorities,




     (B) fully paid American Land Title Association Lender’s Extended
Coverage title insurance policies (the “Mortgage Policies”) in form and
substance, with endorsements (including zoning endorsements where available
at reasonable cost) and in amount acceptable to the Collateral Agent,
issued, and coinsured and reinsured (if required), by title insurers
acceptable to the Collateral Agent, insuring the Mortgages to be valid first
and subsisting Liens on the property described therein, free and clear of
all defects (including, but not limited to, mechanics’ and materialmen’s
Liens) and encumbrances, excepting only Permitted Encumbrances, and
providing for such other affirmative insurance (including endorsements for
future advances under the Loan Documents and for mechanics’ and
materialmen’s Liens), and such coinsurance and direct access reinsurance (if
required), as the Collateral Agent may deem necessary or desirable,




     (C) American Land Title Association/American Congress on Surveying and
Mapping form surveys for which all necessary fees have been paid, dated no
more than 45 days before the date of their delivery to the Collateral Agent,
certified to the Administrative Agent, the Collateral Agent and the issuer
of the Mortgage Policies in a manner satisfactory to the Collateral Agent by
a land surveyor duly registered and licensed in the States in which the
property described in such surveys is located and acceptable to the
Collateral Agent, showing all buildings and other improvements, any off-site
improvements, the location of any easements, parking spaces, rights of way,
building set-back lines and other dimensional regulations and the absence of
encroachments, either by such improvements or on to such property, and other
defects, other than encroachments and other defects acceptable to the
Collateral Agent,




     (D) engineering, soils, seismic, environmental and other similar
reports as to the Borrowing Base Assets as may be reasonably required by the
Collateral Agent, in form and substance and from professional firms
acceptable to the Administrative Agent, together with a letter from each
preparer thereof entitling the Administrative Agent and its successors and
assigns to rely upon such reports,




     (E) estoppel and consent agreements, in form and substance satisfactory
to the Administrative Agent, executed by each of the lessors of any
Borrowing Base Assets subject to a Qualifying Ground Lease,



60









 







along with (1) a memorandum of lease in recordable form (if not
previously recorded) with respect to such leasehold interest, executed and
acknowledged by the owner of the affected Borrowing Base Asset, as lessor,
or (2) evidence that the applicable lease with respect to such leasehold
interest or memorandum thereof has been recorded in all places necessary or
desirable, in the Administrative Agent’s reasonable judgment, to give
constructive notice to third-party purchasers of such leasehold interest or
(3) if such leasehold interest was acquired or subleased from the holder of
a recorded leasehold interest, the applicable assignment or sublease
document, executed and acknowledged by such holder, in each case in form
sufficient to give such constructive notice upon recordation and otherwise
in form satisfactory to the Administrative Agent,




     (F) an Appraisal of each Borrowing Base Asset described in the
Mortgages,




     (G) copies of all material licenses, permits and approvals for each
Borrowing Base Asset, including, without limitation, a certificate of
occupancy,




     (H) a zoning report for each Borrowing Base Asset issued by Planning
and Zoning Resources Corp. or another professional firm acceptable to the
Administrative Agent, together with a letter from each preparer thereof
entitling the Administrative Agent and its successors and assigns to rely
upon such reports,




     (I) certified copies of each Management Agreement, and all amendments
thereto, entered into with respect to each of the Borrowing Base Assets,




     (J) certified copies of all Material Contracts relating to each of the
Borrowing Base Assets,




     (K) copies of all Liens on each of the Borrowing Base Assets,
including, without limitation, any reciprocal easement agreements, easements
and other items of record,




     (L) if requested by the Administrative Agent, estoppel certificates
from the counterparties to any reciprocal easement agreements affecting any
Borrowing Base Asset,




     (M) estoppel certificates and subordination, non-disturbance and
attornment agreements from retail tenants at each of the Borrowing Base
Assets where the annual rent under the applicable Tenancy Lease exceeds
$30,000 per annum,



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     (N) a flood zone determination of each Borrowing Base Asset, and




     (O) such other consents, agreements and confirmations of lessors and
third parties as the Administrative Agent may deem necessary or desirable
and evidence that all other action that the Collateral Agent may deem
necessary or desirable in order to create valid first and subsisting Liens
on the property described in the Mortgages has been taken.




     (iv) This Agreement, duly executed by the Loan Parties and the other parties
thereto.




     (v) Certified copies of the resolutions of the Board of Directors of the Parent
Guarantor on its behalf and on behalf of each Loan Party for which it is the
ultimate signatory approving the transactions contemplated by the Loan Documents and
each Loan Document to which it or such Loan Party is or is to be a party, and of all
documents evidencing other necessary corporate action and governmental and other
third party approvals and consents, if any, with respect to the transactions under
the Loan Documents and each Loan Document to which it or such Loan Party is or is to
be a party.




     (vi) A copy of a certificate of the Secretary of State (or equivalent
authority) of the jurisdiction of incorporation, organization or formation of each
Loan Party and of each general partner, manager or managing member (if any) of each
Loan Party, dated reasonably near the Closing Date, certifying, if and to the extent
such certification is generally available for entities of the type of such Loan
Party, (A) as to a true and correct copy of the charter, certificate of limited
partnership, limited liability company agreement or other organizational document of
such Loan Party, general partner, manager or managing member, as the case may be,
and each amendment thereto on file in such Secretary’s office, (B) that (1) such
amendments are the only amendments to the charter, certificate of limited
partnership, limited liability company agreement or other organizational document,
as applicable, of such Loan Party, general partner, manager or managing member, as
the case may be, on file in such Secretary’s office, (2) such Loan Party, general
partner, manager or managing member, as the case may be, has paid all franchise
taxes to the date of such certificate and (C) such Loan Party, general partner,
manager or managing member, as the case may be, is duly incorporated, organized or
formed and in good standing or presently subsisting under the laws of the
jurisdiction of its incorporation, organization or formation.




     (vii) A copy of a certificate of the Secretary of State (or equivalent
authority) of each jurisdiction in which any Loan Party or any general partner,
manager or managing member of a Loan Party owns or leases property or in which the
conduct of its business requires it to qualify or be licensed as a foreign
corporation except where the failure to so qualify or be licensed could not



62









 







reasonably be expected to result in a Material Adverse Effect, dated reasonably
near (but prior to) the Closing Date, stating, with respect to each such Loan Party,
general partner, manager or managing member, that such Loan Party, general partner,
manager or managing member, as the case may be, is duly qualified and in good
standing as a foreign corporation, limited partnership or limited liability company
in such State and has filed all annual reports required to be filed to the date of
such certificate.




     (viii) A certificate of each Loan Party and of each general partner, manager or
managing member (if any) of each Loan Party, signed on behalf of such Loan Party,
general partner, manager or managing member, as applicable, by its President or a
Vice President and its Secretary or any Assistant Secretary (or those of its general
partner or managing member, if applicable), dated the Closing Date (the statements
made in which certificate shall be true on and as of the Closing Date), certifying
as to (A) the absence of any amendments to the constitutive documents of such Loan
Party, general partner, manager or managing member, as applicable, since the date of
the certificate referred to in Section 3.01(a)(vi), (B) a true and correct copy of
the bylaws, operating agreement, partnership agreement or other governing document
of such Loan Party, general partner, manager or managing member, as applicable, as
in effect on the date on which the resolutions referred to in Section 3.01(a)(v)
were adopted and on the Closing Date, (C) the due incorporation, organization or
formation and good standing or valid existence of such Loan Party, general partner,
manager or managing member, as applicable, as a corporation, limited liability
company or partnership organized under the laws of the jurisdiction of its
incorporation, organization or formation and the absence of any proceeding for the
dissolution or liquidation of such Loan Party, general partner, manager or managing
member, as applicable, (D) the truth of the representations and warranties contained
in the Loan Documents and (E) the absence of any event occurring and continuing, or
resulting from the closing hereunder or the Advance made on the Closing Date, that
constitutes a Default.




     (ix) A certificate of the Secretary or an Assistant Secretary of each Loan
Party (or Responsible Officer of the general partner, manager or managing member of
any Loan Party) and of each general partner, manager or managing member (if any) of
each Loan Party certifying the names and true signatures of the officers of such
Loan Party, or of the general partner, manager or managing member of such Loan
Party, authorized to sign each Loan Document to which it is or is to be a party and
the other documents to be delivered hereunder and thereunder.




     (x) Such financial, business and other information regarding each Loan Party
and its Subsidiaries as the Lender Parties shall have requested, including, without
limitation, information as to possible contingent liabilities, tax matters,
environmental matters, obligations under Plans, Multiemployer Plans and Welfare
Plans, collective bargaining agreements and other arrangements with employees,
historical operating statements (if any), audited annual financial



63









 







statements for the year ending December 31, 2009, interim financial statements
dated the end of the most recent fiscal quarter for which financial statements are
available (or, in the event the Lender Parties’ due diligence review reveals
material changes since such financial statements, as of a later date within 45 days
of the Closing Date) and financial projections for the Parent Guarantor’s
consolidated operations.




     (xi) Evidence of insurance (which may consist of binders or certificates of
insurance) naming the Administrative Agent as loss payee and/or additional insured,
as applicable, with such responsible and reputable insurance companies or
associations, and in such amounts and covering such risks, as is satisfactory to the
Lender Parties, including, without limitation, the insurance required by the terms
of the Security Agreement and the Mortgages.




     (xii) An opinion of Greenberg Traurig LLP, New York counsel for the Loan
Parties, with respect to the matters (and in substantially the form) set forth in
Exhibit E-1 hereto and as to such other matters as any Lender Party through the
Administrative Agent may reasonably request.




     (xiii) An opinion of Bradley Arant Boult Cummings LLP, Delaware counsel for the
Loan Parties, with respect to the matters (and in substantially the form) set forth
in Exhibit E-2 hereto and as to such other matters as any Lender Party through the
Administrative Agent may reasonably request.




     (xiv) An opinion of Saul Ewing LLP, Maryland counsel for the Loan Parties, with
respect to the matters (and in substantially the form) set forth in Exhibit E-3
hereto and as to such other matters as any Lender Party through the Administrative
Agent may reasonably request.




     (xv) An opinion of local counsel for the Loan Parties (A) in the states in
which the Borrowing Base Assets are located, in substantially the form of Exhibit
E-4 hereto, and (B) in the states in which the Loan Parties are organized or formed,
in substantially the form of Exhibit E-4 hereto, in each case covering such other
matters as any Lender Party through the Administrative Agent may reasonably request.




     (xvi) An opinion of Sidley Austin llp, counsel for the Administrative
Agent, in form and substance satisfactory to the Administrative Agent.




     (xvii) A Notice of Borrowing or Notice of Issuance, as applicable, relating to
the Initial Extension of Credit.




     (xviii) A certificate signed by a Responsible Officer of the Borrower, dated
the Closing Date, stating that after giving effect to the Initial Extension of
Credit and the Formation Transactions, the Parent Guarantor shall be in compliance
with the covenants contained in Section 5.04 on a proforma basis as of the most
recent fiscal quarter end, together with supporting information in form



64









 







satisfactory to the Administrative Agent showing the computations used in
determining compliance with such covenants.




     (b) The Lender Parties shall be satisfied with the corporate and legal structure and
capitalization of each Loan Party and its Subsidiaries, including the terms and conditions
of the charter and bylaws, operating agreement, partnership agreement or other governing
document of each of them.




     (c) The Lender Parties shall be satisfied that all Existing Debt, other than Surviving
Debt, has been (or will be at the time of the Initial Extension of Credit) prepaid, redeemed
or defeased in full or otherwise satisfied and extinguished and that all Surviving Debt
shall be on terms and conditions satisfactory to the Lender Parties.




     (d) (i) The Administrative Agent shall have determined that the Formation Transactions
and the IPO shall have been, substantially concurrently with the execution of this
Agreement, consummated in accordance with the Registration Statement, (ii) the Parent
Guarantor shall have received gross cash proceeds from the IPO in an amount not less than
$300,000,000, and (iii) the common shares of the Parent Guarantor shall have been listed on
the New York Stock Exchange.




     (e) Before and after giving effect to the transactions contemplated by the Loan
Documents, there shall have occurred no material adverse change in the business, condition
(financial or otherwise), results of operations or prospects of the Loan Parties or any of
the Borrowing Base Assets included in the Collateral on the Closing Date since December 31,
2009.




     (f) There shall exist no action, suit, investigation, litigation or proceeding
affecting any Loan Party or any of its Subsidiaries pending or threatened before any court,
governmental agency or arbitrator that (i) could reasonably be expected to result in a
Material Adverse Effect other than the matters described on Schedule 4.01(f) hereto (the
“Material Litigation”) or (ii) purports to affect the legality, validity or enforceability
of any Loan Document or the consummation of the transactions contemplated thereby, and there
shall have been no adverse change in the status, or financial effect on any Loan Party or
any of its Subsidiaries, of the Material Litigation from that described on Schedule 4.01(f)
hereto.




     (g) All governmental and third party consents and approvals necessary in connection
with the transactions contemplated by the Loan Documents shall have been obtained (without
the imposition of any conditions that are not acceptable to the Lender Parties) and shall
remain in effect, and no law or regulation shall be applicable in the reasonable judgment of
the Lender Parties that restrains, prevents or imposes materially adverse conditions upon
the transactions contemplated by the Loan Documents.




     (h) The Borrower shall have entered into the Hedge Agreements required under
Section 5.01(o) to the extent any are required by such Section, and shall have provided
satisfactory evidence of the same to the Administrative Agent.



65









 






     (i) The Borrower shall have paid all accrued fees of the Agents and the Lender Parties
required under this Agreement and all reasonable, out-of-pocket expenses of the Agents
(including the reasonable fees and expenses of counsel to the Administrative Agent).



          SECTION 3.02. Conditions Precedent to Each Borrowing, Issuance, Renewal, Extension and
Increase. The obligation of each Lender to make an Advance (other than a Letter of Credit
Advance made by an Issuing Bank or a Lender pursuant to Section 2.03(c) and a Swing Line Advance
made by a Lender pursuant to Section 2.02(b)) on the occasion of each Borrowing (including the
initial Borrowing) and the obligation of each Issuing Bank to issue a Letter of Credit (including
the initial issuance) or renew a Letter of Credit, the extension of Commitments pursuant to
Section 2.16 and the right of the Borrower to request a Swing Line Borrowing or a Commitment
Increase shall be subject to the satisfaction of the conditions set forth in Section 3.01 (to the
extent not previously satisfied pursuant to that Section) and such further conditions precedent
that on the date of such Borrowing, issuance, renewal, extension or increase (a) the following
statements shall be true and the Administrative Agent shall have received for the account of such
Lender, the Swing Line Bank or such Issuing Bank (w) a Notice of Borrowing or Notice of Issuance,
as applicable, and a Borrowing Base Certificate, in each case dated the date of such Borrowing,
issuance, renewal, extension or increase and, in the case of the Borrowing Base Certificate,
demonstrating that the Facility Exposure that will be outstanding after giving effect to such
Advance, issuance or renewal, respectively, will not exceed the lesser of (i) the Total Borrowing
Base Value as of such date and (ii) the amount that would have a Borrowing Base Debt Service
Coverage Ratio of not less than 1.50:1.00 (in each case calculated on a pro forma basis after
giving effect to such Borrowing or issuance), (x) all Collateral Deliverables and all items
described in the definition of “BBA Proposal Package” herein (to the extent not previously
delivered with respect to each Borrowing Base Asset pursuant to Section 5.01(k) or this
Section 3.02), (y) in the case of an addition of any Person as an Additional Guarantor, all
Guarantor Deliverables (to the extent not previously delivered pursuant to Section 5.01(k) or this
Section 3.02), and (z) a certificate signed by a Responsible Officer of the Borrower, dated the
date of such Borrowing, issuance, renewal, extension or increase, stating that:




     (i) the representations and warranties contained in each Loan Document are true and
correct in all material respects on and as of such date (except to the extent that such
representations and warranties specifically refer to an earlier date, in which case they are
true and correct as of such earlier date), before and after giving effect to (A) such
Borrowing, issuance, renewal, extension or increase, and (B) in the case of any Borrowing or
issuance or renewal, the application of the proceeds therefrom, as though made on and as of
such date;




     (ii) no Default or Event of Default has occurred and is continuing, or would result
from (A) such Borrowing, issuance, renewal, extension or increase or (B) in the case of any
Borrowing or issuance or renewal, from the application of the proceeds therefrom; and




     (iii) for each Revolving Credit Advance, or Swing Line Advance made by the Swing Line
Bank or issuance or renewal of any Letter of Credit, (A) the Facility



66









 







Exposure that will be outstanding after giving effect to such Advance, issuance or
renewal, respectively, will not exceed the lesser of (i) the Total Borrowing Base Value as
of such date and (ii) the amount that would have a Borrowing Base Debt Service Coverage
Ratio of not less than 1.50:1.00 and (B) before and after giving effect to such Advance,
issuance or renewal, the Parent Guarantor shall be in compliance with the covenants
contained in Section 5.04, together with supporting information in form satisfactory to the
Administrative Agent showing the computations used in determining compliance with such
covenants;



and (b) the Administrative Agent shall have received such other approvals, opinions or documents as
any Lender Party through the Administrative Agent may reasonably request.




          SECTION 3.03. Determinations Under Section 3.01 and 3.02. For purposes of determining
compliance with the conditions specified in Sections 3.01 and 3.02, each Lender Party shall be
deemed to have consented to, approved or accepted or to be satisfied with each document or other
matter required thereunder to be consented to or approved by or acceptable or satisfactory to the
Lender Parties unless an officer of the Administrative Agent responsible for the transactions
contemplated by the Loan Documents shall have received notice from such Lender Party prior to the
Initial Extension of Credit, Borrowing, issuance, renewal, extension or increase, as applicable,
specifying its objection thereto and, if the requested action consists of a Borrowing, such Lender
Party shall not have made available to the Administrative Agent such Lender Party’s ratable portion
of such Borrowing.



ARTICLE IV

REPRESENTATIONS AND WARRANTIES




          SECTION 4.01. Representations and Warranties of the Loan Parties. Each Loan Party
represents and warrants as follows:




     (a) Organization and Powers; Qualifications and Good Standing. Each Loan Party
and each of its Subsidiaries and each general partner, manager or managing member, if any,
of each Loan Party (i) is a corporation, limited liability company or partnership duly
incorporated, organized or formed, validly existing and in good standing under the laws of
the jurisdiction of its incorporation, organization or formation, (ii) is duly qualified and
in good standing as a foreign corporation, limited liability company or partnership in each
other jurisdiction in which it owns or leases property or in which the conduct of its
business requires it to so qualify or be licensed except where the failure to so qualify or
be licensed could not reasonably be expected to result in a Material Adverse Effect and
(iii) has all requisite corporate, limited liability company or partnership power and
authority (including, without limitation, all governmental licenses, permits and other
approvals) to own or lease and operate its properties and to carry on its business as now
conducted and as proposed to be conducted. All of the outstanding Equity Interests in the
Borrower have been validly issued, are fully paid and non-assessable. The Parent Guarantor
directly or indirectly owns all of the general partnership interests in the Borrower. All
Equity Interests in the Borrower that are directly or indirectly owned by the Parent
Guarantor are owned free and clear of all Liens. The Parent Guarantor is organized in
conformity with the requirements for qualification as a REIT under the



67









 







Internal Revenue Code, and its proposed method of operation enables it to meet the
requirements for qualification and taxation as a REIT under the Internal Revenue Code.




     (b) Subsidiaries. Set forth on Schedule 4.01(b) hereto is a complete and
accurate list of all Subsidiaries of each Loan Party, showing as of the date hereof (as to
each such Subsidiary) the jurisdiction of its incorporation, organization or formation, the
number of shares (or the equivalent thereof) of each class of its Equity Interests
authorized, and the number outstanding, on the date hereof and the percentage of each such
class of its Equity Interests owned (directly or indirectly) by such Loan Party and the
number of shares (or the equivalent thereof) covered by all outstanding options, warrants,
rights of conversion or purchase and similar rights at the date hereof. All of the
outstanding Equity Interests in each Loan Party’s Subsidiaries has been validly issued, are
fully paid and non-assessable and to the extent owned by such Loan Party or one or more of
its Subsidiaries, are owned by such Loan Party or Subsidiaries free and clear of all Liens
(except as created by the Loan Documents).




     (c) Due Authorization; No Conflict. The execution and delivery by each Loan
Party and each general partner, manager or managing member (if any) of each Loan Party of
each Loan Document to which it is or is to be a party, and the performance of its
obligations thereunder, and the consummation of the IPO, the Formation Transactions and the
other transactions contemplated by the Loan Documents, are within the corporate, limited
liability company or partnership powers of such Loan Party, general partner, manager or
managing member, have been duly authorized by all necessary corporate, limited liability
company or partnership action, and do not (i) contravene the charter or bylaws, operating
agreement, partnership agreement or other governing document of such Loan Party, general
partner, manager or managing member, (ii) violate any law, rule, regulation (including,
without limitation, Regulation X of the Board of Governors of the Federal Reserve System),
order, writ, judgment, injunction, decree, determination or award, (iii) conflict with or
result in the breach of, or constitute a default or require any payment (except for payments
that will be made at the time of consummation of the IPO and the Formation Transactions) to
be made under, any Material Contract, loan agreement, indenture, mortgage, deed of trust,
lease or other instrument binding on or affecting any Loan Party, any of its Subsidiaries or
any of their properties, or any general partner, manager or managing member of any Loan
Party or (iv) except for the Liens created under the Loan Documents, result in or require
the creation or imposition of any Lien upon or with respect to any of the properties of any
Loan Party or any of its Subsidiaries. No Loan Party or any of its Subsidiaries is in
violation of any such law, rule, regulation, order, writ, judgment, injunction, decree,
determination or award or in breach of any such contract, loan agreement, indenture,
mortgage, deed of trust, lease or other instrument, the violation or breach of which could
reasonably be expected to result in a Material Adverse Effect.




     (d) Authorizations and Consents. No authorization or approval or other action
by, and no notice to or filing with, any governmental authority or regulatory body or any
other third party is required for (i) the due execution, delivery, recordation, filing or
performance by any Loan Party or any general partner, manager or managing member of any Loan
Party of any Loan Document to which it is or is to be a party or for the



68









 







consummation of the IPO, the Formation Transactions or the other transactions
contemplated by the Loan Documents, (ii) the grant by any Loan Party (or the general partner
or managing member of such Loan Party) of the Liens granted by it pursuant to the Collateral
Documents, (iii) the perfection or maintenance of the Liens created under the Collateral
Documents (including the first priority nature thereof) or (iv) the exercise by any Agent,
the Collateral Agent or any Lender Party of its rights under the Loan Documents or the
remedies in respect of the Collateral pursuant to the Collateral Documents, except, in each
case, for authorizations, approvals, actions, notices and filings which have been duly
obtained, taken, given or made and are in full force and effect.




     (e) Binding Obligation. This Agreement has been, and each other Loan Document
when delivered hereunder will have been, duly executed and delivered by each Loan Party and
general partner, manager or managing member (if any) of each Loan Party party thereto. This
Agreement is, and each other Loan Document when delivered hereunder will be, the legal,
valid and binding obligation of each Loan Party and general partner, manager or managing
member (if any) of each Loan Party party thereto, enforceable against such Loan Party,
general partner, manager or managing member, as the case may be, in accordance with its
terms.




     (f) Litigation. There is no action, suit, investigation, litigation or
proceeding affecting any Loan Party or any of its Subsidiaries or any general partner,
manager or managing member (if any) of any Loan Party, including any Environmental Action,
pending or threatened before any court, governmental agency or arbitrator that (i) could
reasonably be expected to result in a Material Adverse Effect (other than the Material
Litigation) or (ii) purports to affect the legality, validity or enforceability of any Loan
Document or the consummation of the IPO, the Formation Transactions or the other
transactions contemplated by the Loan Documents, and there has been no adverse change in the
status, or financial effect on any Loan Party or any of its Subsidiaries or any general
partner, manager or managing member (if any) of any Loan Party, of the Material Litigation
from that described on Schedule 4.01(f) hereto.




     (g) Financial Condition. The Consolidated balance sheets of the Parent
Guarantor and its Subsidiaries as of December 31, 2009 and the related Consolidated
statements of income and Consolidated statements of cash flows of the Parent Guarantor and
its Subsidiaries for the fiscal year then ended, accompanied by unqualified opinions of KPMG
LLP, independent public accountants and the Consolidated balance sheets of the Parent
Guarantor and its Subsidiaries as at June 30, 2010, and the related Consolidated statements
of income and Consolidated statements of cash flows of the Parent Guarantor and its
Subsidiaries for the six (6) months then ended, copies of which have been furnished to each
Lender Party, fairly present, subject, in the case of such balance sheets as at June 30,
2010, and such statements of income and cash flows for the six (6) months then ended, to
year end audit adjustments, the Consolidated financial condition of the Parent Guarantor and
its Subsidiaries as at such dates and the Consolidated results of operations of the Parent
Guarantor and its Subsidiaries for the periods ended on such dates, all in accordance with
generally accepted accounting principles applied on a consistent basis. Since December 31,
2009, there has been



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(i) with respect to the period prior to the Closing Date, no material adverse change in
the business, condition (financial or otherwise), results of operations or prospects of the
Parent Guarantor and its Subsidiaries or any of the Borrowing Base Assets included in the
Collateral on the Closing Date, and (ii) with respect to any period after the Closing Date,
no Material Adverse Change.




     (h) Forecasts. The Consolidated forecasted balance sheets, statements of
income and statements of cash flows of the Parent Guarantor and its Subsidiaries delivered
to the Lender Parties pursuant to Section 3.01(a)(x) and 5.03 were prepared in good faith on
the basis of the assumptions stated therein, which assumptions were fair in light of the
conditions existing at the time of delivery of such forecasts, and represented, at the time
of delivery, the Parent Guarantor’s best estimate of its future financial performance.




     (i) Full Disclosure. No information, exhibit or report furnished by or on
behalf of any Loan Party to any Agent or any Lender Party in connection with the negotiation
and syndication of the Loan Documents or pursuant to the terms of the Loan Documents
contained any untrue statement of a material fact or omitted to state a material fact
necessary to make the statements made therein not misleading. The Loan Parties have
disclosed to the Administrative Agent, in writing, any and all existing facts known to the
Loan Parties that have or may have (to the extent any of the Loan Parties can now reasonably
foresee) a Material Adverse Effect.




     (j) Margin Regulations. No Loan Party owns any Margin Stock or is engaged in
the business of extending credit for the purpose of purchasing or carrying Margin Stock, and
no proceeds of any Advance or drawings under any Letter of Credit will be used to purchase
or carry any Margin Stock or to extend credit to others for the purpose of purchasing or
carrying any Margin Stock.




     (k) Certain Governmental Regulations. Neither any Loan Party nor any of its
Subsidiaries nor any general partner, manager or managing member of any Loan Party, as
applicable, is an “investment company”, or an “affiliated person” of, or “promoter” or
“principal underwriter” for, an “investment company”, as such terms are defined in the
Investment Company Act of 1940, as amended. Without limiting the generality of the
foregoing, each Loan Party and each of its Subsidiaries and each general partner, manager or
managing member of any Loan Party, as applicable: (i) is primarily engaged, directly or
through a wholly-owned subsidiary or subsidiaries, in a business or businesses other than
that of (A) investing, reinvesting, owning, holding or trading in securities or (B) issuing
face-amount certificates of the installment type; (ii) is not engaged in, does not propose
to engage in and does not hold itself out as being engaged in the business of (A) investing,
reinvesting, owning, holding or trading in securities or (B) issuing face-amount
certificates of the installment type; (iii) does not own or propose to acquire investment
securities (as defined in the Investment Company Act of 1940, as amended) having a value
exceeding forty percent (40%) of the value of such company’s total assets (exclusive of
government securities and cash items) on an unconsolidated basis; (iv) has not in the past
been engaged in the business of issuing face-amount certificates of the installment type;
and (v) does not have any outstanding face-amount certificates of the



70









 







installment type. Neither the making of any Advances, nor the issuance of any Letters
of Credit, nor the application of the proceeds or repayment thereof by the Borrower, nor the
consummation of the other transactions contemplated by the Loan Documents, will violate any
provision of any such Act or any rule, regulation or order of the Securities and Exchange
Commission thereunder.




     (l) Materially Adverse Agreements. Neither any Loan Party nor any of its
Subsidiaries is a party to any indenture, loan or credit agreement or any lease or other
agreement or instrument or subject to any charter, corporate, partnership, membership or
other governing restriction that could reasonably be expected to result in a Material
Adverse Effect.




     (m) Perfection and Priority of Security Interests. All filings and other
actions necessary to perfect and protect the security interest in the Collateral created
under the Collateral Documents have been duly made or taken and are in full force and
effect, and the Collateral Documents create in favor of the Administrative Agent for the
benefit of the Secured Parties a valid and, together with such filings and other actions,
perfected first priority security interest in the Collateral (subject only to the Permitted
Liens), securing the payment of the Secured Obligations, and all filings and other actions
necessary or desirable to perfect and protect such security interest have been duly taken.
The Loan Parties are the legal and beneficial owners of the Collateral free and clear of any
Lien, except for Permitted Liens.




     (n) Existing Debt. Set forth on Schedule 4.01(n) hereto is a complete and
accurate list of all Existing Debt (other than Surviving Debt), showing as of the date
hereof the obligor and the principal amount outstanding thereunder immediately prior to the
Closing Date.




     (o) Surviving Debt. Set forth on Schedule 4.01(o) hereto is a complete and
accurate list of all Surviving Debt, showing as of the date hereof the obligor and the
principal amount outstanding thereunder, the maturity date thereof and the amortization
schedule therefor.




     (p) Liens. Set forth on Schedule 4.01(p) hereto is a complete and accurate
list of (i) all Liens on the property or assets of any Loan Party or any of its Subsidiaries
that directly or indirectly own any Borrowing Base Asset (other than Permitted Liens), and
(ii) all Liens on the property or assets of any Loan Party or any of its Subsidiaries
securing Debt for Borrowed Money (other than Permitted Liens); in each case showing as of
the date hereof the lienholder thereof, the principal amount of the obligations secured
thereby and the property or assets of such Loan Party or such Subsidiary subject thereto.




     (q) Real Property; Tenancy Leases. (i) Set forth on Part I of Schedule 4.01(q)
hereto is a complete and accurate list of all Real Property owned in fee or as a leasehold
estate by any Loan Party or any of its Subsidiaries, showing as of the date hereof, and as
of each other date such Schedule 4.01(q) is required to be supplemented hereunder, the
street address, state, record owner and book value thereof. Each such Loan Party or



71









 







Subsidiary has good, marketable and insurable fee simple or leasehold title to such
Real Property, free and clear of all Liens, other than Permitted Liens.




     (ii) The Borrower has delivered to the Administrative Agent a true, correct and
complete copy of the current form of residential Tenancy Lease for each Borrowing
Base Asset, and true, correct and complete copies of any non-residential Tenancy
Leases and any amendments thereto relating to each Borrowing Base Asset as of the
date hereof. An accurate and complete rent roll as of the date of inclusion of each
Borrowing Base Asset in the Collateral with respect to all Tenancy Leases of any
portion of the Borrowing Base Asset has been provided to the Administrative Agent.
The Tenancy Leases described in the preceding sentence constitute as of the date
thereof the sole agreements relating to leasing or licensing of space at such
Borrowing Base Asset and in the buildings relating thereto. No tenant under any
Tenancy Lease is entitled to any free rent, partial rent, rebate of rent payments,
credit, offset or deduction in rent, including, without limitation, lease support
payments or lease buy-outs, except as reflected in such Tenancy Leases or as
disclosed to the Administrative Agent in writing by the Borrower. The Tenancy
Leases reflected on the rent rolls delivered to the Administrative Agent are, as of
the date of inclusion of the applicable Borrowing Base Asset in the Collateral, in
full force and effect in accordance with their respective terms. There is no
payment default or any other material default under such Tenancy Leases, nor, to
Borrower’s knowledge, are there any defenses, counterclaims or offsets available to
any tenant thereunder which in either case is reasonably likely to have a Material
Adverse Effect. No property other than the Borrowing Base Asset which is the
subject of the applicable Tenancy Lease (and any adjacent property burdened by
insurable, permanent easements which may benefit the Borrowing Base Asset and are in
full force and effect) is necessary to comply with the requirements (including,
without limitation, parking requirements) contained in such Tenancy Lease.




     (iii) Each Borrowing Base Asset is operated and managed by an Approved Manager
pursuant to a Management Agreement listed on Part II of Schedule 4.01(q).




     (iv) Each Borrowing Base Asset satisfies all Borrowing Base Conditions.




     (r) Environmental Matters. (i) Except as otherwise set forth on Part I of
Schedule 4.01(r) hereto, the operations and properties of each Loan Party and each of its
Subsidiaries comply in all material respects with all applicable Environmental Laws and
Environmental Permits, all past material non-compliance with such Environmental Laws and
Environmental Permits has been resolved without ongoing material obligations or costs, and,
to the knowledge of each Loan Party and its Subsidiaries, no circumstances exist that could
be reasonably likely to (A) form the basis of an Environmental Action against any Loan Party
or any of its Subsidiaries or any of their properties that could have a Material Adverse
Effect or (B) cause any such property to be subject to any restrictions on ownership,
occupancy, use or transferability under any Environmental Law.



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     (ii) Except as otherwise set forth on Part II of Schedule 4.01(r) hereto, none
of the properties currently or formerly owned or operated by any Loan Party or any
of its Subsidiaries is listed or, to the knowledge of each Loan Party and its
Subsidiaries, proposed for listing on the NPL or on the CERCLIS or any analogous
foreign, state or local list or is adjacent to any such listed property; there are
no underground or above ground storage tanks or any surface impoundments, septic
tanks, pits, sumps or lagoons in which Hazardous Materials are being or have been
treated, stored or disposed on any property currently owned or operated by any Loan
Party or any of its Subsidiaries; there is no asbestos or asbestos-containing
material on any property currently owned or operated by any Loan Party or any of its
Subsidiaries except for any non-friable asbestos-containing material that is being
managed pursuant to, and in compliance with, an operations and maintenance plan and
that does not currently require removal, remediation, abatement or encapsulation
under Environmental Law; and, to the knowledge of each Loan Party and its
Subsidiaries, Hazardous Materials have not been released, discharged or disposed of
in any material amount or in violation of any Environmental Law or Environmental
Permit on any property currently owned or operated by any Loan Party or any of its
Subsidiaries or, to the knowledge of each Loan Party and its Subsidiaries, during
the period of their ownership or operation thereof, on any property formerly owned
or operated by any Loan Party or any of its Subsidiaries.




     (iii) Except as otherwise set forth on Part III of Schedule 4.01(r) hereto,
neither any Loan Party nor any of its Subsidiaries is undertaking, nor has any Loan
Party or any of its Subsidiaries completed, either individually or together with
other potentially responsible parties, any investigation or assessment or remedial
or response action relating to any actual or threatened release, discharge or
disposal of Hazardous Materials at any site, location or operation, either
voluntarily or pursuant to the order of any governmental or regulatory authority or
the requirements of any Environmental Law; all Hazardous Materials generated, used,
treated, handled or stored at, or transported to or from, any property currently or
formerly owned or operated by any Loan Party or any of its Subsidiaries have been
disposed of in a manner not reasonably expected to result in a Material Adverse
Effect; and, with respect to any property formerly owned or operated by any Loan
Party or any of its Subsidiaries, all Hazardous Materials generated, used, treated,
handled, stored or transported by or, to the knowledge of each Loan Party and its
Subsidiaries, on behalf of any Loan Party or any of its Subsidiaries have been
disposed of in a manner that could not reasonably be expected to result in a
Material Adverse Effect.




     (iv) Except as set forth on Part IV of Schedule 4.01(r),
neither any Loan Party nor any of its Subsidiaries nor the Real Property is subject
to any applicable Environmental Law requiring the performance of Hazardous Materials
site assessments, or the removal or remediation of Hazardous Materials, or the
giving of notice to any governmental agency or the recording or delivery to other
Persons of an environmental disclosure document or statement in each case by virtue
of the transactions set forth herein and contemplated hereby, or as a



73









 







condition to the recording of the Mortgages or to the effectiveness of any
other transactions contemplated hereby except for such matters that shall be
complied with as of the Closing Date.




     (s) Compliance with Laws. Each Loan Party and each Subsidiary is in compliance
with the requirements of all laws, rules and regulations (including, without limitation, the
Securities Act and the Securities Exchange Act, and the applicable rules and regulations
thereunder, state securities law and “Blue Sky” laws) applicable to it and its business,
where the failure to so comply could reasonably be expected to result in a Material Adverse
Effect.




     (t) Force Majeure. Neither the business nor the properties of any Loan Party
or any of its Subsidiaries are currently affected by any fire, explosion, accident, strike,
lockout or other labor dispute, drought, storm, hail, earthquake, embargo, act of God or of
the public enemy or other casualty (whether or not covered by insurance) that could
reasonably be expected to result in a Material Adverse Effect.




     (u) Loan Parties’ Credit Decisions. Each Loan Party has, independently and
without reliance upon the Administrative Agent or any other Lender Party and based on such
documents and information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement (and in the case of the Guarantors, to give the
guaranty under this Agreement) and each other Loan Document to which it is or is to be a
party, and each Loan Party has established adequate means of obtaining from each other Loan
Party on a continuing basis information pertaining to, and is now and on a continuing basis
will be completely familiar with, the business, condition (financial or otherwise),
operations, performance, properties and prospects of such other Loan Party.




     (v) Solvency. Each Loan Party is, individually and together with its
Subsidiaries, Solvent.




     (w) Sarbanes-Oxley. No Loan Party has made any extension of credit to any of
its directors or executive officers in contravention of any applicable restrictions set
forth in Section 402(a) of Sarbanes-Oxley.




     (x) ERISA Matters. (i) Set forth on Schedule 4.01(x) hereto is a complete and
accurate list of all Plans and Welfare Plans.




     (ii) No ERISA Event has occurred within the preceding five plan years or is
reasonably expected to occur with respect to any Plan that has resulted in or is
reasonably expected to result in a material liability of any Loan Party or any ERISA
Affiliate.




     (iii) Any Schedule B (Actuarial Information) to the most recent annual report
(Form 5500 Series) for each Plan, copies of which have been filed with the Internal
Revenue Service and furnished to the Lender Parties, is complete and accurate and
fairly presents the funding status of such Plan as of the date of such Schedule B,
and since the date of any such Schedule B there has been no material adverse change
in such funding status.



74









 






     (iv) Neither any Loan Party nor any ERISA Affiliate has incurred or is
reasonably expected to incur any Withdrawal Liability to any Multiemployer Plan.




     (v) Neither any Loan Party nor any ERISA Affiliate has been notified by the
sponsor of a Multiemployer Plan that such Multiemployer Plan is in reorganization or
has been terminated, within the meaning of Title IV of ERISA, and no such
Multiemployer Plan is reasonably expected to be in reorganization or to be
terminated, within the meaning of Title IV of ERISA.




     (y) Borrowing Base Assets.




     (i) Each of the Mortgages, when properly recorded in the appropriate records,
creates a valid, perfected first lien on the respective Borrowing Base Asset,
subject only to Permitted Liens. The Loan Parties are the legal and beneficial
owners of the Borrowing Base Assets, free and clear of any Lien, except for
Permitted Liens described in clauses (a), (b), (d), (e) and (f) of the definition of
“Permitted Liens”. Each of the Borrowing Base Assets satisfies the requirements in
this Agreement to being a Borrowing Base Asset. There are no proceedings in
condemnation or eminent domain affecting any of the Borrowing Base Assets and, to
the knowledge of each Loan Party, none is threatened. No Person has any option or
other right to purchase all or any portion of any of the Borrowing Base Assets or
any interest therein.




     (ii) To the knowledge of each Loan Party and except as may be disclosed in the
zoning reports and property condition reports delivered to the Administrative Agent,
(i) the Borrowing Base Assets and the use thereof comply in all material respects
with all applicable zoning, subdivision and land use laws, regulations and
ordinances, all applicable health, fire, building codes, parking laws and all other
laws, statutes, codes, ordinances, rules and regulations applicable to the Borrowing
Base Assets, or any of them, including without limitation the Americans with
Disabilities Act; (ii) all permits, licenses and certificates for the lawful use,
occupancy and operation of each component of each of the Borrowing Base Assets in
the manner in which it is currently being used, occupied and operated, including,
but not limited to certificates of occupancy, or the equivalent, have been obtained
and are current and in full force and effect; (iii) no legal proceedings are pending
or, to the knowledge of each Loan Party, threatened with respect to the zoning of
any Borrowing Base Asset; and (iv) neither the zoning nor any other right to
construct, use or operate any Borrowing Base Asset is in any way dependent upon or
related to any real estate other than such Borrowing Base Asset in any way that has
had or is reasonably likely to give rise to a materially adverse effect as to the
value, use of or ability to sell or finance such Borrowing Base Asset.




     (iii) The Loan Parties have delivered to the Administrative Agent a true and
complete copy of each of the Management Agreements and Material Contracts to which
they are a party that will be in effect on the Closing Date, and




75












 






such Management Agreements and Material Contracts have not been modified
or amended except pursuant to amendments or modifications delivered to
Administrative Agent. Such Management Agreements and Material Contracts are in full
force and effect and no default by any of the Loan Parties or Approved Managers
exists thereunder. Except for the rights of (x) each of the Approved Managers
pursuant to any Management Agreements and (y) third-party vendors (including,
without limitation, landscapers, ATM lessors, vending machine lessors and the like),
no Person has any right or obligation to manage any of the Borrowing Base Assets or
to receive compensation in connection with such management. Except for the parties
to any leasing brokerage agreement that has been delivered to the Administrative
Agent and community assistants who are paid a minimal referral fee for residential
Tenancy Leases they obtain, no Person has any right or obligation to lease or
solicit tenants for any of the Borrowing Base Assets, or (except for cooperating
outside brokers) to receive compensation in connection with such leasing.




     (iv) To each Loan Party’s knowledge, all improvements on any Borrowing Base
Asset, including without limitation the roof and all structural components, plumbing
systems, HVAC systems, fire protection systems, electrical systems, equipment,
elevators, exterior doors, parking facilities, sidewalks and landscaping, are in
good condition and repair, subject to normal wear and tear and necessary repairs in
the ordinary course of business. The Loan Parties are not aware of any latent or
patent structural or other material defect in any of the Borrowing Base Assets and,
to the Loan Parties’ knowledge, city water supply, storm and sanitary sewers, and
electrical, gas (if applicable) and telephone facilities are available to each of
the Borrowing Base Assets within the boundary lines of each of the Borrowing Base
Assets (except in any way that has not had and is reasonably likely to not give rise
to a materially adverse effect as to the value, use of or ability to sell or finance
such Borrowing Base Asset), are fully connected to the improvements and are fully
operational, are sufficient to meet the reasonable needs of each of the Borrowing
Base Assets as now used or presently contemplated to be used, and no other utility
facilities are necessary to meet the reasonable needs of any of the Borrowing Base
Assets as now used or presently contemplated. Except in any way that has not had
and is reasonably likely to not give rise to a materially adverse effect as to the
value, use of or ability to sell or finance such Borrowing Base Asset, no part of
any of the Borrowing Base Assets is within a flood plain and none of the
improvements thereon create encroachments over, across or upon any of the Borrowing
Base Assets’ boundary lines, rights of way or easements, and no building or other
improvements on adjoining land create such an encroachment which could reasonably be
expected to have a Material Adverse Effect. All public roads and streets necessary
for service of and access to each of the Borrowing Base Assets for the current and
contemplated uses thereof have been completed and are serviceable and are physically
and legally open for use by the public. To the Loan Parties’ knowledge after due
inquiry, any septic system located at any of the Borrowing Base Assets is in good
and safe condition and repair and in compliance with all applicable law in all
material respects.



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     (v) Each of the Borrowing Base Assets is comprised of one (1) or more parcels
which constitute separate tax lots. No part of any of the Borrowing Base Assets is
included or assessed under or as part of another tax lot or parcel, and no part of
any other property is included or assessed under or as part of the tax lots or
parcels comprising any of the Borrowing Base Assets.




     (vi) Neither the Borrower nor any of the Guarantors has received any
outstanding notice from any insurer or its agent requiring performance of any work
with respect to any of the Borrowing Base Assets or canceling or threatening to
cancel any policy of insurance, and each of the Borrowing Base Assets complies with
the material requirements of all of the Borrower’s and the Guarantor’s insurance
carriers.




     (z) Ground Lease (Mobile). (i) The Ground Lease (Mobile) contains the entire
agreement of the Ground Lessor (Mobile) and the applicable Loan Party pertaining to the
Ground Leased Property (Mobile) covered thereby. The Loan Parties have no estate, right,
title or interest in or to the Ground Leased Property (Mobile) except under and pursuant to
the Ground Lease (Mobile). The Loan Parties have delivered a true and correct copy of the
Ground Lease (Mobile) to the Administrative Agent and the Ground Lease (Mobile) has not been
modified, amended or assigned (except as referenced in the definition of Ground Lease
(Mobile)) and except as assigned as collateral for the Existing Debt secured by the Ground
Leased Property (Mobile) which is being repaid.




     (ii) To the knowledge of each Loan Party, the party identified as the master
lessor and landlord in the definition of Ground Lessor (Mobile) is the exclusive fee
simple owner of the Ground Leased Property (Mobile), subject only to the Ground
Lease (Mobile) and Liens and other matters disclosed in the applicable Mortgage
Policy for the Campus Housing Asset subject to the Ground Lease (Mobile). To the
knowledge of each Loan Party, the party identified as the master lessor and landlord
in the definition of Ground Lessor (Mobile) is the sole owner of the master lessor’s
interest in the Ground Lease (Mobile) and the party identified as sub-ground lessor
in the definition of Ground Lease (Mobile) is the sole owner of the sub-ground
lessor’s interest in the Ground Lease (Mobile).




     (iii) There are no rights to terminate the Ground Lease (Mobile) other than the
rights expressly set forth in the Ground Lease (Mobile).




     (iv) The Ground Lease (Mobile) is in full force and effect and, to the
knowledge of each Loan Party, no breach or default or event that with the giving of
notice or passage of time would constitute a breach or default under the Ground
Lease (Mobile) (a “Ground Lease (Mobile) Default”) exists on the part of the Loan
Parties or on the part of the Ground Lessor (Mobile) under the Ground Lease
(Mobile). All base rent and additional rent due and payable under the Ground Lease
(Mobile) has been paid through the date hereof and the Loan Parties are not required
to pay any deferred or accrued rent after the date hereof under the Ground Lease
(Mobile). The Loan Parties have not received any written notice that a Ground Lease
Default (Mobile) has occurred or exists



77









 







(except for matters which have been resolved to the mutual satisfaction of the
parties to the Ground Lease (Mobile)).




     (v) Campus Crest at Mobile Phase II, LLC is the exclusive owner of the
sub-ground lessee’s interest under and pursuant to the Ground Lease (Mobile) and has
not assigned, transferred or encumbered its interest in, to, or under the Ground
Lease (Mobile) (except as collateral for the Existing Debt secured by the Ground
Leased Property (Mobile) which has been repaid).




     (aa) No Prohibited Persons. Neither any Loan Party nor any of their respective
officers, directors, partners, members, Affiliates or, to the knowledge of the Loan Parties,
shareholders is an entity or person: (i) that is listed in the Annex to, or is otherwise
subject to the provisions of Executive Order 13224 issued on September 24, 2001 (“EO13224”);
(ii) whose name appears on the United States Treasury Department’s Office of Foreign Assets
Control (“OFAC”) most current list of “Specifically Designated National and Blocked Persons”
(which list may be published from time to time in various mediums including, but not limited
to, the OFAC website, http:www.treas.gov/ofac/t11sdn.pdf); (iii) who commits, threatens to
commit or supports “terrorism”, as that term is defined in EO 13224; or (iv) who is
otherwise affiliated with any entity or person listed above (any and all parties or persons
described in clauses (i) through (iv) above are herein referred to as a “Prohibited
Person”).




     (bb) Setoff, Etc. The Collateral and the rights of the Administrative Agent
and the Lenders with respect to the Collateral are not subject to any setoff, claims,
withholdings or other defenses by the Guarantors, Borrower or any of its Subsidiaries or
Affiliates or, to the best knowledge of Borrower, any other Person other than Permitted
Liens.




     (cc) Franchises, Patents, Copyrights, Etc. The Borrower, the Guarantors and
their respective Subsidiaries possess all franchises, patents, copyrights, trademarks, trade
names, service marks, licenses and permits, and rights in respect of the foregoing, adequate
for the conduct of their business substantially as now conducted without known conflict with
any rights of others except with respect to Subsidiaries of Borrower that are not the owners
of the Borrowing Base Assets where such failure individually or in the aggregate has not had
and could not reasonably be expected to have a Material Adverse Effect.




     (dd) Affiliate Ground Leases. With respect to each Affiliate Ground Lease,
(a) the Affiliate Ground Lease or a memorandum thereof has been duly recorded, the Affiliate
Ground Lease permits the interest of the lessee thereunder to be encumbered by the Mortgage,
there has not been a change in the terms of the Affiliate Ground Lease since its
recordation, except for written modifications delivered to Administrative Agent, and
Borrower has delivered to Administrative Agent a true, accurate and complete copy of the
Affiliate Ground Lease; (b) except for the Permitted Encumbrances (as defined in the
Mortgage) and Permitted Liens, the Subsidiary Guarantor’s interest in the Affiliate Ground
Lease is not subject to any Liens superior to, or of equal priority with, the Mortgage; (c)
there are no outstanding options to purchase or rights of first refusal with



78









 







respect to the Real Property except those granted to the Subsidiary Guarantor under the
express terms of the Affiliate Ground Lease; (d) the Subsidiary Guarantor’s interest in the
Affiliate Ground Lease is assignable to Administrative Agent upon notice to, but without the
consent of, the ground lessor thereunder (or if such consent is required, it has been
obtained prior to or concurrently herewith); (e) the Affiliate Ground Lease is in full force
and effect, no default exists under the Affiliate Ground Lease, and there is no existing
condition which, but for the passage of time or the giving of notice (or both), would result
in a default under the terms of the Affiliate Ground Lease; (f) the Affiliate Ground Lease
requires the ground lessor thereunder to give notice of any default by the Subsidiary
Guarantor to any mortgagee, and it provides that any notice of termination given under the
Affiliate Ground Lease is not effective against such mortgagee unless a copy of the notice
has been delivered to the mortgagee in the manner described in the Affiliate Ground Lease;
(g) Administrative Agent is permitted a reasonable opportunity (including, where necessary,
sufficient time to gain possession of the Subsidiary Guarantor’s interest under the
Affiliate Ground Lease) to cure any default under the Affiliate Ground Lease, which is
curable after the receipt of notice of the default before the ground lessor thereunder may
terminate the Affiliate Ground Lease; (h) the Affiliate Ground Lease has a term which
extends not less than twenty (20) years beyond the Termination Date (including the exercise
of all extension options); (i) the Affiliate Ground Lease requires the ground lessor
thereunder to enter into a new lease upon termination of the Affiliate Ground Lease for any
reason, including rejection of the Affiliate Ground Lease in a bankruptcy proceeding,
provided that Administrative Agent cures any defaults that are susceptible to being cured;
(j) the Affiliate Ground Lease permits the use of the proceeds of any casualty or
condemnation at the Real Property for either (A) the restoration of the Real Property (and
in such case permits such restoration proceeds to be held and disbursed by Administrative
Agent or its designee), or (B) the repayment of the Advances; (k) the Affiliate Ground Lease
permits subleasing of the Real Property by a mortgagee, subject only to the reasonable
approval of the ground lessor; (l) the Affiliate Ground Lease provides that no amendments,
cancellations, alterations, surrender, or modifications thereof may become effective without
the consent of Administrative Agent; and (m) the Advances are also secured by the related
fee interest in the Real Property and upon the occurrence of an Event of Default,
Administrative Agent, as mortgagee, has the right to foreclose or otherwise exercise its
rights with respect to the fee interest within a commercially reasonable time.



ARTICLE V

COVENANTS OF THE LOAN PARTIES




          SECTION 5.01. Affirmative Covenants. So long as any Advance or any other Obligation
of any Loan Party under any Loan Document shall remain unpaid, any Letter of Credit shall be
outstanding or any Lender Party shall have any Commitment hereunder, each Loan Party will:





     (a) Compliance with Laws, Etc. Comply, and cause each of its Subsidiaries to
comply, in all material respects, with all applicable laws, rules, regulations and orders
(such compliance to include, without limitation, compliance with ERISA and the Racketeer
Influenced and Corrupt Organizations Chapter of the Organized Crime Control



79









 







Act of 1970); provided, however, that the failure to comply with the
provisions of this Section 5.01(a) shall not constitute a default hereunder so long as such
noncompliance is the subject of a Good Faith Contest.




     (b) Payment of Taxes, Etc. Pay and discharge, and cause each of its
Subsidiaries to pay and discharge, before the same shall become delinquent, (i) all taxes,
assessments and governmental charges or levies imposed upon it or upon its property and
(ii) all lawful claims that, if unpaid, might by law become a Lien upon its property;
provided, however, that neither the Loan Parties nor any of their Subsidiaries shall be
required to pay or discharge any such tax, assessment, charge or claim that is the subject
of a Good Faith Contest, unless and until any Lien resulting therefrom attaches to its
property and becomes enforceable against its other creditors.




     (c) Compliance with Environmental Laws. Comply, and cause each of its
Subsidiaries and all lessees and other Persons operating or occupying its properties to
comply, in all material respects, with all applicable Environmental Laws and Environmental
Permits; obtain and renew and cause each of its Subsidiaries to obtain and renew all
Environmental Permits necessary for its operations and properties; and conduct, and cause
each of its Subsidiaries to conduct, any investigation, study, sampling and testing, and
undertake any cleanup, removal, remedial or other action necessary to remove and clean up
all Hazardous Materials from any of its properties in material compliance with the
requirements of all Environmental Laws; provided, however, that neither the Loan Parties nor
any of their Subsidiaries shall be required to undertake any such cleanup, removal, remedial
or other action to the extent that its obligation to do so is the subject of a Good Faith
Contest.




     (d) Maintenance of Insurance. Maintain, and cause each of its Subsidiaries to
maintain, insurance (including, with respect to the Borrowing Base Assets, the insurance
required by the terms of the Mortgages) with responsible and reputable insurance companies
or associations in such amounts and covering such risks as is usually carried by companies
engaged in similar businesses and owning similar properties in the same general areas in
which such Loan Party or such Subsidiaries operate, but in no event shall such amounts be
lower or coverages be less comprehensive than the respective insurance amounts and coverages
maintained by the Borrower and its Subsidiaries on the Closing Date approved by the
Administrative Agent.




     (e) Preservation of Partnership or Corporate Existence, Etc. Preserve and
maintain, and cause each of its Subsidiaries to preserve and maintain, its existence
(corporate or otherwise), legal structure, legal name, rights (charter and statutory),
permits, licenses, approvals, privileges and franchises, unless, in the case of Subsidiaries
of the Borrower only, in the reasonable business judgment of such Subsidiary, such
Subsidiary determines that it is in its best economic interest not to preserve and maintain
such rights or franchises and such failure to preserve and maintain such rights or
franchises is not reasonably likely to result in a Material Adverse Effect (it being
understood that the foregoing shall not prohibit, or be violated as a result of any
transaction by or involving any Loan Party or Subsidiary thereof otherwise permitted under
Section 5.02(d) or (e) below).



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     (f) Visitation Rights. At any reasonable time and from time to time, after
reasonable advance notice to the Borrower, permit any of the Agents or Lender Parties, or
any agent or representatives thereof, to examine and make copies of and abstracts from the
records and books of account of, and visit the properties of, any Loan Party and any of its
Subsidiaries, and to discuss the affairs, finances and accounts of any Loan Party and any of
its Subsidiaries with any of their general partners, managers, managing members, officers or
directors and with their independent certified public accountants; provided, that,
notwithstanding anything herein to the contrary, the Borrower shall be obligated to
reimburse the Administrative Agent and the Lenders for their costs and expenses incurred in
connection with the exercise of their rights under this Section 5.01(f) only if such
exercise occurs after the occurrence and during the continuance of a Default or an Event of
Default.




     (g) Keeping of Books. Keep, and cause each of its Subsidiaries to keep, proper
books of record and account, in which full and correct entries shall be made of all
financial transactions and the assets and business of such Loan Party and each such
Subsidiary in accordance with GAAP.




     (h) Maintenance of Properties, Etc. Maintain and preserve, and cause each of
its Subsidiaries to maintain and preserve, all of its properties that are used or useful in
the conduct of its business in good working order and condition, ordinary wear and tear
excepted, and will from time to time make or cause to be made all appropriate repairs,
renewals and replacement thereof except where failure to do so could not reasonably be
expected to result in a Material Adverse Effect.




     (i) Transactions with Affiliates. Conduct, and cause each of its Subsidiaries
to conduct, all transactions otherwise permitted under the Loan Documents with any of their
Affiliates (other than transactions exclusively among or between the Borrower and/or one or
more of the Guarantors) on terms that are fair and reasonable and no less favorable to such
Loan Party or such Subsidiary than it would obtain in a comparable arm’s length transaction
with a Person not an Affiliate.




     (j) Covenants to Guarantee Obligations and Give Additional Security.
(A) Concurrently with the delivery of Collateral Deliverables pursuant to Section 5.01(k)
with respect to a Proposed Borrowing Base Asset owned or leased by a Subsidiary of a Loan
Party or (B) within 10 days after the formation or acquisition of any new direct or indirect
Subsidiary of a Loan Party that directly owns or leases a Borrowing Base Asset, cause (i)
each such Subsidiary (if it has not already done so), to duly execute and deliver to the
Administrative Agent a Guaranty Supplement in substantially the form of Exhibit C hereto, or
such other guaranty supplement in form and substance reasonably satisfactory to the
Administrative Agent, guaranteeing the other Loan Parties’ Obligations under the Loan
Documents and (ii) each direct and, if applicable, indirect parent of such Subsidiary (if it
has not already done so), to duly execute and deliver to the Administrative Agent (or, in
the case of clause (2) below, the Collateral Agent), (1) a security agreement supplement and
a pledge agreement supplement in form and substance reasonably satisfactory to the
Administrative Agent, and (2) 100% of the certificated Equity Interests in each such
Subsidiary and each direct and indirect parent of



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such Subsidiary (other than the Parent Guarantor and the Borrower), but solely to the
extent such direct and indirect parents of such Subsidiary do not own any assets other than
Equity Interests in Subsidiaries that directly or indirectly own Borrowing Base Assets, and
stock powers and membership interest powers with respect thereto executed in blank, all in
form and substance reasonably acceptable to the Administrative Agent.




     (k) Borrowing Base Additions. With the Borrower’s written request to the
Administrative Agent that any Campus Housing Asset (a “Proposed Borrowing Base Asset”) be
added as a Borrowing Base Asset, deliver (or cause to be delivered) to the Administrative
Agent, at the Borrower’s expense, a BBA Proposal Package with respect to such Proposed
Borrowing Base Asset. Within fifteen (15) Business Days after receipt of a complete BBA
Proposal Package, the Administrative Agent shall give notice to the Borrower of whether the
Administrative Agent and the Required Lenders have approved such Proposed Borrowing Base
Asset as a Borrowing Base Asset subject to the delivery of all applicable Collateral
Deliverables and Guarantor Deliverables pursuant to the following sentence (any such notice
comprising an approval, a “Conditional Approval Notice”). Within 45 days after receipt by
the Borrower of a Conditional Approval Notice (which period may be extended in the
discretion of the Administrative Agent, at the Borrower’s request, for an additional 30 days
without the approval of the Required Lenders), the Borrower shall, at its expense, deliver
(or cause to be delivered) to the Administrative Agent all applicable Collateral
Deliverables and Guarantor Deliverables. Notwithstanding the foregoing, the failure of any
Proposed Borrowing Base Asset to comply with one or more of the Borrowing Base Conditions
shall not preclude the addition of such Proposed Borrowing Base Asset as a Borrowing Base
Asset so long as the Administrative Agent and the Required Lenders shall have expressly
consented to the addition of such Proposed Borrowing Base Asset as a Borrowing Base Asset
notwithstanding the failure to satisfy such conditions.




     (l) Further Assurances. (i) Promptly upon request by Administrative Agent, or
any Lender Party through the Administrative Agent, correct, and cause each Loan Party to
promptly correct, any material defect or error that may be discovered in any Loan Document
or in the execution, acknowledgment, filing or recordation thereof.




     (ii) Promptly upon request by any Agent, or any Lender Party through the
Administrative Agent, do, execute, acknowledge, deliver, record, re-record, file,
re-file, register and re-register any and all such further acts, deeds, conveyances,
pledge agreements, account control agreements, mortgages, deeds of trust, trust
deeds, assignments of leases and rents, assignments, financing statements and
continuations thereof, termination statements, notices of assignment, transfers,
certificates, assurances and other instruments as any Agent, or any Lender Party
through the Administrative Agent, may reasonably require from time to time in order
(A) to carry out more effectively the purposes of the Loan Documents and the intent
of the parties hereto, (B) to the fullest extent permitted by applicable law, to
subject any Loan Party’s or any of its Subsidiaries’ properties, assets, rights or
interests to the Liens now or hereafter intended to be covered by any of the
Collateral Documents, (C) to perfect and maintain the validity, effectiveness and
priority of any of the Collateral



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Documents and any of the Liens intended to be created thereunder and (D) to
assure, convey, grant, assign, transfer, preserve, protect and confirm more
effectively unto the Secured Parties the rights granted or now or hereafter intended
to be granted to the Secured Parties under any Loan Document or under any other
instrument executed in connection with any Loan Document to which any Loan Party or
any of its Subsidiaries is or is to be a party, and cause each of its Subsidiaries
to do so.




     (iii) Cooperate in a commercially reasonable manner with the relevant appraiser
in connection with any Appraisal of a Borrowing Base Asset (including any proposed
additional Borrowing Base Asset), such cooperation to include, without limitation,
providing such appraiser with access to such information relating to such Borrowing
Base Asset as such appraiser may reasonably request.




     (iv) No tract map, parcel map, condominium plan, condominium declaration, or
plat of subdivision will be recorded by any Loan Party with respect to any Borrowing
Base Asset without the Administrative Agent’s prior written consent, which consent
shall not be unreasonably withheld, delayed or conditioned.




     (m) Performance of Material Contracts. Perform and observe, and cause each of
its Subsidiaries to perform and observe, all the terms and provisions of each Material
Contract to be performed or observed by it, maintain each such Material Contract in full
force and effect, enforce each such Material Contract in accordance with its terms, take all
such action to such end as may be from time to time reasonably requested by the
Administrative Agent, and, upon the reasonable request of the Administrative Agent, make to
each other party to each such Material Contract such demands and requests for information
and reports or for action as any Loan Party or any of its Subsidiaries is entitled to make
under such Material Contract, and cause each of its Subsidiaries to do so; provided,
that the foregoing shall not prohibit, or be violated as a result of, any transactions or
determinations by or involving any Loan Party or Subsidiary thereof otherwise permitted
under Section 5.02(l).




     (n) Leases. (i) Make all payments and otherwise perform in all material
respects all obligations in respect of all leases of real property to which the Borrower or
any of its Subsidiaries is a party, keep such leases in full force and effect and not allow
such leases to lapse or be terminated or any rights to renew such leases to be forfeited or
cancelled (except, in the case of Subsidiaries of the Borrower only, if in the reasonable
business judgment of such Subsidiary it is in its best economic interest not to maintain
such lease or prevent such lapse, termination, forfeiture or cancellation and such failure
to maintain such lease or prevent such lapse, termination, forfeiture or cancellation is not
in respect of a Qualifying Ground Lease of a Borrowing Base Asset and could not otherwise
reasonably be expected to result in a Material Adverse Effect), notify the Administrative
Agent of any default by any party with respect to such leases and cooperate with the
Administrative Agent in all respects to cure any such default, and cause each of its
Subsidiaries to do so.



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     (ii) Without the prior written consent of Administrative Agent, such approval
not to be unreasonably withheld, conditioned or delayed, none of Borrower, any
Subsidiary Guarantor, nor their respective agents shall (A) enter into any
non-residential Tenancy Leases where the annual rent under the applicable Tenancy
Lease exceeds $30,000 per annum, or (B) modify, amend or terminate any such
non-residential Tenancy Lease (except as expressly permitted or contemplated
hereunder). Borrower shall provide Administrative Agent with a copy of all
non-residential Tenancy Leases where the annual rent under the applicable Tenancy
Lease exceeds $30,000 per annum no less than ten (10) days prior to execution of
such Tenancy Leases. Borrower shall provide Administrative Agent with a copy of the
fully executed original of all non-residential Tenancy Leases promptly following
their execution. At Administrative Agent’s request, Borrower or Subsidiary
Guarantors shall use best efforts to cause all non-residential tenants where the
annual rent under the applicable Tenancy Lease exceeds $30,000 per annum to execute
subordination, non-disturbance and attornment agreements reasonably satisfactory to
Administrative Agent. Administrative Agent reserves the right to subordinate the
Mortgages to any Tenancy Lease.




     (o) Interest Rate Hedging. Enter into prior to the Closing Date, and maintain
at all times thereafter, interest rate Hedge Agreements (i) with Persons acceptable to the
Administrative Agent (it being understood and agreed that such Persons shall be deemed
acceptable to the Administrative Agent if and for so long as they have a long term unsecured
debt rating of not less than “A-” from S&P and not less than “A3” from Moody’s, provided
that if at any time the long term unsecured debt rating of such Persons falls below such
required ratings or if any such required credit ratings is placed on watch for downgrade by
S&P or Moody’s, then Administrative Agent shall have the right to reasonably require that
such Loan Party, at such Loan Party’s expense, provide replacement Hedge Agreements from
different Persons which satisfy the required credit ratings), (ii) providing either an
interest-rate swap for a fixed rate of interest acceptable to the Administrative Agent or an
interest-rate cap at an interest rate acceptable to the Administrative Agent, (iii) covering
a notional amount equal to the amount, if any, by which (A) 662/3% of Debt for Borrowed Money
of the Parent Guarantor and its Subsidiaries exceeds (B) all Debt for Borrowed Money of the
Parent Guarantor and its Subsidiaries then accruing interest at a fixed rate acceptable to
the Administrative Agent and (iv) otherwise on terms and conditions reasonably acceptable to
the Administrative Agent.




     (p) Management Agreements. At all times cause each Borrowing Base Asset to be
managed and operated by an Approved Manager that has (i) entered into a management agreement
with respect to such Asset in form and substance satisfactory to the Administrative Agent,
and (ii) executed and delivered a management agreement subordination agreement in form and
substance satisfactory to the Administrative Agent.




     (q) Maintenance of REIT Status. In the case of the Parent Guarantor,
commencing with its taxable year, ending December 31, 2010, be organized in conformity with
the requirements for qualification as a REIT under the Internal Revenue



84









 







Code, and at all times thereafter, conduct its affairs and the affairs of its
Subsidiaries in a manner so as to continue to qualify as a REIT and elect to be treated as a
REIT under all applicable laws, rules and regulations.




     (r) Exchange Listing. In the case of the Parent Guarantor, at all times
(i) cause its common shares to be duly listed on the New York Stock Exchange, the American
Stock Exchange or NASDAQ and (ii) timely file all reports required to be filed by it in
connection therewith.




     (s) Sarbanes-Oxley. Comply at all times with all applicable provisions of
Section 402(a) of Sarbanes-Oxley.



          SECTION 5.02. Negative Covenants. So long as any Advance or any other Obligation of
any Loan Party under any Loan Document shall remain unpaid, any Letter of Credit shall be
outstanding or any Lender Party shall have any Commitment hereunder, no Loan Party will, at any
time:





     (a) Liens, Etc. Create, incur, assume or suffer to exist, or permit any of its
Subsidiaries to create, incur, assume or suffer to exist, any Lien on or with respect to any
of its assets of any character (including, without limitation, accounts) whether now owned
or hereafter acquired, or sign or file or suffer to exist, or permit any of its Subsidiaries
to sign or file or suffer to exist, under the Uniform Commercial Code of any jurisdiction, a
financing statement that names such Loan Party or any of its Subsidiaries as debtor, or sign
or suffer to exist, or permit any of its Subsidiaries to sign or suffer to exist, any
security agreement authorizing any secured party thereunder to file such financing
statement, or assign, or permit any of its Subsidiaries to assign, any accounts or other
right to receive income, except, in the case of the Loan Parties (other than the Parent
Guarantor) and their respective Subsidiaries:




     (i) Liens created under the Loan Documents;




     (ii) Permitted Liens;




     (iii) Liens described on Schedule 4.01(p) hereto;




     (iv) purchase money Liens upon or in equipment acquired or held by such Loan
Party or any of its Subsidiaries in the ordinary course of business to secure the
purchase price of such equipment or to secure Debt incurred solely for the purpose
of financing the acquisition of any such equipment to be subject to such Liens, or
Liens existing on any such equipment at the time of acquisition (other than any such
Liens created in contemplation of such acquisition that do not secure the purchase
price), or extensions, renewals or replacements of any of the foregoing for the same
or a lesser amount; provided, however, that no such Lien shall extend to or cover
any property other than the equipment being acquired, and no such extension, renewal
or replacement shall extend to or cover any property not theretofore subject to the
Lien being extended, renewed or replaced; provided further that the aggregate
principal amount of the Debt secured



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by Liens permitted by this clause (iv) shall not exceed the amount permitted
under Section 5.02(b)(iii)(A);




     (v) Liens arising in connection with Capitalized Leases permitted under
Section 5.02(b)(iii)(B), provided that no such Lien shall extend to or cover any
Collateral or assets other than the assets subject to such Capitalized Leases;




     (vi) Liens on property of a Person existing at the time such Person is acquired
by, merged into or consolidated with any Loan Party or any Subsidiary of any Loan
Party or becomes a Subsidiary of any Loan Party, provided that such Liens were not
created in contemplation of such merger, consolidation or acquisition and do not
extend to any assets other than those of the Person so merged into or consolidated
with such Loan Party or such Subsidiary or so acquired by such Loan Party or such
Subsidiary;




     (vii) Liens securing Non-Recourse Debt permitted under Section 5.02(b)(iii)(E),
Recourse Debt permitted under Section 5.02(b)(iv) or Debt permitted under Section
5.02(b)(vii), provided, in each case, that no such Lien shall extend to or cover any
Borrowing Base Asset or other Collateral;




     (viii) the replacement, extension or renewal of any Lien permitted by
clause (iii) above upon or in the same property theretofore subject thereto in
connection with any Refinancing Debt permitted under Section 5.02(b)(iii)(C);




     (ix) Liens arising in connection with any Secured Hedge Agreement; and




     (x) Liens arising in connection with Debt in respect of Hedge Agreements
permitted under Section 5.02(b)(iii)(D) (other than Secured Hedge Agreements),
provided that no such lien shall extend to or cover any Borrowing Base Asset or
other Collateral.




     (b) Debt. Create, incur, assume or suffer to exist, or permit any of its
Subsidiaries to create, incur, assume or suffer to exist, any Debt, except:




     (i) Debt under the Loan Documents;




     (ii) in the case of any Loan Party or any Subsidiary of a Loan Party, Debt owed
to any Loan Party, provided that, in each case, such Debt (y) shall be on terms
acceptable to the Administrative Agent and (z) shall be evidenced by promissory
notes in form and substance satisfactory to the Administrative Agent, which
promissory notes shall (unless payable to the Borrower) by their terms be
subordinated to the Obligations of the Loan Parties under the Loan Documents;




     (iii) in the case of each Loan Party (other than the Parent Guarantor) and its
Subsidiaries,



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     (A) Debt secured by Liens permitted by Section 5.02(a)(iv) not to
exceed in the aggregate $5,000,000 at any time outstanding,




     (B) (1) Capitalized Leases not to exceed in the aggregate $5,000,000 at
any time outstanding, and (2) in the case of any Capitalized Lease to which
any Subsidiary of a Loan Party is a party, any Contingent Obligation of such
Loan Party guaranteeing the Obligations of such Subsidiary under such
Capitalized Lease,




     (C) the Surviving Debt described on Schedule 4.01(o) hereto and any
Refinancing Debt extending, refunding or refinancing such Surviving Debt,




     (D) Debt in respect of Hedge Agreements entered into by the Borrower
and designed to hedge against fluctuations in interest rates or foreign
exchange rates incurred as required by this Agreement or incurred in the
ordinary course of business and consistent with prudent business practices,




     (E) Non-Recourse Debt (including, without limitation, the JV Pro Rata
Share of Non-Recourse Debt of any Joint Venture) in respect of Assets other
than Borrowing Base Assets, the incurrence of which would not result in a
Default under Section 5.04 or any other provision of this Agreement, and




     (F) Recourse Debt not secured by any Lien in an amount not to exceed 5%
of Total Asset Value at any one time outstanding;




     (iv) Recourse Debt of the Borrower and/or Property-Level Subsidiaries of the
Borrower and the JV Pro Rata Share of Recourse Debt of any Joint Venture, in each
case as such Recourse Debt may be secured by Liens permitted by Section
5.02(a)(vii), in respect of which the Borrower or the Parent Guarantor has
guaranteed the obligations of the Borrower and/or such Property-Level Subsidiary or
Joint Venture under such Recourse Debt and the incurrence of which would not result
in a Default under Section 5.04 or any other provision of this Agreement;




     (v) in the case of the Parent Guarantor and the Borrower, Debt under Customary
Carve-Out Agreements;




     (vi) endorsements of negotiable instruments for deposit or collection or
similar transactions in the ordinary course of business; and




     (vii) any other Debt not to exceed $5,000,000 in the aggregate at any time
outstanding in respect of all Loan Parties and which is not secured by any Lien on
any Borrowing Base Asset.



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     (c) Change in Nature of Business. Make, or permit any of its Subsidiaries to
make, any material change in the nature of its business as carried at the Closing Date
(after giving effect to the Formation Transactions, the IPO and the other transactions
contemplated by the Loan Documents); or engage in, or permit any of its Subsidiaries to
engage in, any business other than ownership, development, licensing and management of
Campus Housing Assets in the United States consistent with the business plan described in
the Registration Statement and the requirements of the Loan Documents, and other business
activities incidental thereto.




     (d) Mergers, Etc. Merge or consolidate with or into, or convey, transfer
(except as permitted by Section 5.02(e)), lease or otherwise dispose of (whether in one
transaction or in a series of transactions) all or substantially all of its assets (whether
now owned or hereafter acquired) to, any Person, or permit any of its Subsidiaries to do so;
provided, however, that (i) any Subsidiary of a Loan Party may merge or consolidate with or
into, or dispose of assets to, any other Subsidiary of such Loan Party (provided that if one
or more of such Subsidiaries is also a Loan Party, a Loan Party shall be the surviving
entity) or any other Loan Party other than the Parent Guarantor (provided that such Loan
Party or, in the case of any Loan Party other than the Borrower, another Loan Party shall be
the surviving entity), and (ii) any Loan Party may merge with any Person that is not a Loan
Party so long as such Loan Party is the surviving entity or (except in the case of a merger
with the Borrower, which shall always be the surviving entity) such other Person is the
surviving party and shall promptly become a Loan Party, provided, in each case, that no
Default shall have occurred and be continuing at the time of such proposed transaction or
would result therefrom. Notwithstanding any other provision of this Agreement, (y) any
Subsidiary of a Loan Party (other than the Borrower and any Subsidiary that is the direct
owner of a Borrowing Base Asset) may liquidate or dissolve if the Borrower determines in
good faith that such liquidation or dissolution is in the best interests of the Borrower and
the assets or proceeds from the liquidation or dissolution of such Subsidiary are
transferred to the Borrower or a Guarantor, provided that no Default or Event of Default
shall have occurred and be continuing at the time of such proposed transaction or would
result therefrom, and (z) any Loan Party or Subsidiary of a Loan Party shall be permitted to
effect any Transfer of Assets through the sale or transfer of direct or indirect Equity
Interests in the Person (other than the Borrower or the Parent Guarantor) that owns such
Assets so long as Section 5.02(e) would otherwise permit the Transfer of all Assets owned by
such Person at the time of such sale or transfer of such Equity Interests. Upon the sale or
transfer of Equity Interests in any Person that is a Guarantor permitted under clause (z)
above, provided that no Default or Event of Default shall have occurred and be continuing or
would result therefrom, the Administrative Agent shall, upon the request of the Borrower,
release such Guarantor from the Guaranty and the Collateral Documents.




     (e) Sales, Etc. of Assets. (i) In the case of the Parent Guarantor, sell,
lease, transfer or otherwise dispose of, or grant any option or other right to purchase,
lease or otherwise acquire any assets and (ii) in the case of the Loan Parties (other than
the Parent Guarantor), sell, lease (other than by entering into Tenancy Leases), transfer or
otherwise dispose of, or grant any option or other right to purchase, lease (other than any
option or other right to enter into Tenancy Leases) or otherwise acquire, or permit any of
its



88









 







Subsidiaries to sell, lease, transfer or otherwise dispose of, or grant any option or
other right to purchase, lease or otherwise acquire (each action described in clauses (i)
and (ii) of this subsection (e), including, without limitation, any Sale and Leaseback
Transaction, being a “Transfer”), any Asset or Assets (or any direct or indirect Equity
Interests in the owner thereof), or obtain a release of the Liens created under the Loan
Documents, in each case other than the following Transfers and releases, which shall be
permitted hereunder only so long as no Default or Event of Default shall exist or would
result therefrom:




     (A) the Transfer of any Asset or Assets that are not Borrowing Base
Assets from any Loan Party to another Loan Party (other than the Parent
Guarantor) or from a Subsidiary of a Loan Party to another Subsidiary of
such Loan Party or any other Loan Party (other than the Parent Guarantor),




     (B) the Transfer of any Asset or Assets that are not Borrowing Base
Assets to any Person that is not a Loan Party, provided that (1) the Loan
Parties shall be in compliance with the covenants contained in Section 5.04
both immediately prior to and on a pro forma basis immediately after giving
effect to such Transfer, and (2) in the case of any such Transfer which
shall result in the aggregate purchase price paid to the Loan Parties (or
any of them) to exceed $50,000,000 in any 12-month period and any such
Transfer thereafter consummated during such 12-month period, prior to the
date of such Transfer, the Borrower shall have delivered to the
Administrative Agent (x) a Borrowing Base Certificate demonstrating that the
Total Borrowing Base Value (calculated on a pro forma basis after giving
effect to such Transfer and to any repayment of Advances made at the time
thereof) will be greater than or equal to the Facility Exposure, and (y) a
certificate of the Chief Financial Officer (or other Responsible Officer
performing similar functions) of the Borrower demonstrating compliance with
the foregoing clause (1) and confirming that no Default or Event of Default
shall exist on the date of such Transfer or will result therefrom, together
with supporting information in detail reasonably satisfactory to the
Administrative Agent,




     (C) the Transfer of any Borrowing Base Asset or Borrowing Base Assets
to any Person, or obtaining a release of the Liens created under the Loan
Documents with respect to a Borrowing Base Asset or Borrowing Base Assets,
in each case with the intention that such Borrowing Base Asset or Borrowing
Base Assets, upon consummation of such Transfer or release, shall no longer
constitute a Borrowing Base Asset or Borrowing Base Assets, provided that:




     (1) immediately after giving effect to such Transfer or release,
as the case may be, the remaining Borrowing Base Assets shall
continue to satisfy the requirements set forth in clauses (a) through
(h) of the definition of Borrowing Base Conditions,



89









 






     (2) immediately after giving effect to such Transfer or release,
as the case may be, no Default or Event of Default shall exist or
result therefrom,




     (3) the Loan Parties shall be in compliance with the covenants
contained in Section 5.04 both immediately prior to and on a
pro forma basis immediately after giving effect to such Transfer or
release,




     (4) on or prior to the date of such Transfer or release, as the
case may be, the Borrower shall have delivered to the Administrative
Agent a certificate of the Chief Financial Officer (or other
Responsible Officer performing similar functions) of the Borrower
demonstrating compliance with the foregoing clauses (1) through (3),
together with supporting information in detail reasonably
satisfactory to the Administrative Agent, and




     (5) With respect to a release of the Liens created under the
Loan Documents only, which release is not executed as a result of a
Transfer or refinancing of such Borrowing Base Asset, Borrower shall
have received the prior written approval of the release from the
Administrative Agent and the Required Lenders, or




     (D) the Transfer of (1) obsolete or worn out personal property in the
ordinary course of business or (2) inventory in the ordinary course of
business, which personal property or inventory, as the case may be, is used
or held in connection with an Asset.




Following (x) a Transfer of all Borrowing Base Assets owned or leased by a
Subsidiary Guarantor in accordance with Section 5.02(e)(ii)(C) or (y) the release by
a Subsidiary Guarantor of all Borrowing Base Assets owned or leased by it such that
such Borrowing Base Assets become non-Borrowing Base Assets pursuant to
Section 5.02(e)(ii)(C), the Administrative Agent shall, upon the request of the
Borrower and at the Borrower’s expense, promptly release such Subsidiary Guarantor
from the Guaranty and the Security Agreement.




     (f) Investments. Make or hold, or permit any of its Subsidiaries to make or
hold, any Investment other than:




     (i) Investments by the Loan Parties and their Subsidiaries in their
Subsidiaries outstanding on the date hereof and additional Investments in
wholly-owned Subsidiaries and, in the case of the Loan Parties (other than the
Parent Guarantor) and their Subsidiaries (and Joint Ventures in which such Loan
Parties and Subsidiaries hold any direct or indirect interest), Investments in
Assets (including by asset or Equity Interest acquisitions or investments in Joint



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Ventures), in each case subject, where applicable, to the limitations set forth
in Section 5.02(f)(iv);




     (ii) Investments in Cash Equivalents;




     (iii) Investments consisting of intercompany Debt permitted under
Section 5.02(b)(ii);




     (iv) Investments consisting of the following items so long as (y) the aggregate
amount outstanding, without duplication, of all Investments described in this
subsection does not exceed, (1) 35% of Total Asset Value during the period from the
Closing Date through the fiscal quarter of the Parent Guarantor ending on June 30,
2011, (2) 30% of Total Asset Value during the period thereafter ending with the
fiscal quarter of the Parent Guarantor ending on June 30, 2012 or (3) 25% of Total
Asset Value, at any time thereafter, and (z) the aggregate amount of each of the
following items of Investments does not exceed at any time the specified percentage
of Total Asset Value set forth below:




     (A) Investments in unimproved land and Development Assets (including
such assets that such Person has contracted to purchase for development with
or without options to terminate the purchase agreement but, in such
instances, limited solely to non-refundable deposits under such contracts
and, to the extent a Loan Party is obligated under any such contract, the
amount of such obligation), so long as the aggregate amount of such
Investments, calculated on the basis of the greater of actual cost or
budgeted cost, does not at any time exceed 10% and 20%, respectively, of
Total Asset Value at such time,




     (B) Investments in Joint Ventures of any Loan Party so long as the
aggregate amount outstanding, without duplication, of all such Investments
does not at any time exceed 15% of Total Asset Value at such time, and




     (C) Investments permitted under this Subsection, other than the items
of Investments referred to in clauses (A) and (B) above, so long as the
aggregate amount of all such Investments does not at any time exceed 10% of
Total Asset Value at such time;




     (v) Investments, if any, outstanding on the date hereof in Subsidiaries that
are not wholly-owned by any Loan Party;




     (vi) Investments by the Borrower in Hedge Agreements permitted under
Section 5.02(b)(iii)(D);




     (vii) To the extent permitted by applicable law, loans or other extensions of
credit to officers, directors and employees of any Loan Party or any Subsidiary of
any Loan Party in the ordinary course of business, for travel, entertainment,
relocation and analogous ordinary business purposes, which



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Investments shall not exceed at any time $1,000,000 in the aggregate for all
Loan Parties;




     (viii) Investments consisting of extensions of credit in the nature of accounts
receivable or notes receivable arising from the grant of trade credit extended in
the ordinary course of business in an aggregate amount for all Loan Parties not to
exceed at any time $5,000,000; and




     (ix) Investments received in satisfaction or partial satisfaction thereof from
financially troubled account debtors to the extent reasonably necessary in order to
prevent or limit loss.




     (g) Restricted Payments. In the case of the Parent Guarantor, declare or pay
any dividends, purchase, redeem, retire, defease or otherwise acquire for value any of its
Equity Interests now or hereafter outstanding, return any capital to its stockholders,
partners or members (or the equivalent Persons thereof) as such, make any distribution of
assets, Equity Interests, obligations or securities to its stockholders, partners or members
(or the equivalent Persons thereof) as such (collectively, “Restricted Payments”); provided,
however, that (i) the Parent Guarantor may take such actions only so long as (A) no Default
or Event of Default shall have occurred and be continuing or would result therefrom and (B)
as of the date of such action, the Loan Parties are in compliance with the covenants
contained in Section 5.04 (both immediately before and on a pro forma basis immediately
after giving effect to such action), (ii) the Parent Guarantor may declare and make dividend
payments or other distributions payable solely in the common stock or other common Equity
Interests of the Parent Guarantor and (iii) the Parent Guarantor may purchase, redeem, or
otherwise acquire shares of its common stock or other common Equity Interests or warrants or
options to acquire any such shares with the proceeds received from the substantially
concurrent issue of new shares of its common stock or other common Equity Interests, so long
as the aggregate amount of such purchases, redemptions and acquisitions of shares of common
stock or other common Equity Interests or warrants or options to acquire any such shares
does not at any time exceed 90% of the Funds From Operations for the consecutive four fiscal
quarters of the Parent Guarantor most recently ended for which financial statements are
required to be delivered to the Lender Parties pursuant to Section 5.03(b) or (c), as the
case may be. Notwithstanding anything herein to the contrary, cash and stock dividends
payable by the Parent Guarantor on Equity Interests shall be permitted to the extent
necessary to maintain the Parent’s REIT status, provided that the cash component of such
dividends shall be the minimum amount required by law or regulation for such purpose.




     (h) Amendments of Constitutive Documents. Amend, or permit any of its
Subsidiaries to amend, in each case in any material respect, its limited liability company
agreement, partnership agreement, certificate of incorporation or bylaws or other
constitutive documents, provided that any amendment to any such constitutive document that
would be adverse to any of the Secured Parties shall be deemed “material” for purposes of
this Section; and provided further that any amendment to any such constitutive document that
would designate such Subsidiary as a “special purpose entity”



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or otherwise confirm such Subsidiary’s status as a “special purpose entity” shall be
deemed “not material” for purposes of this Section.




     (i) Accounting Changes. Make or permit, or permit any of its Subsidiaries to
make or permit, any change in (i) accounting policies or reporting practices, except as
required or permitted by generally accepted accounting principles, or (ii) Fiscal Year.




     (j) Speculative Transactions. Engage, or permit any of its Subsidiaries to
engage, in any transaction involving commodity options or futures contracts or any similar
speculative transactions or any other derivative transaction not entered into to hedge
against interest rate fluctuations in the ordinary course of business.




     (k) Payment Restrictions Affecting Subsidiaries. Directly or indirectly, enter
into or suffer to exist, or permit any of its Subsidiaries to enter into or suffer to exist,
any agreement or arrangement limiting the ability of any of its Subsidiaries to declare or
pay dividends or other distributions in respect of its Equity Interests or repay or prepay
any Debt owed to, make loans or advances to, or otherwise transfer assets to or invest in,
the Borrower or any Subsidiary of the Borrower (whether through a covenant restricting
dividends, loans, asset transfers or investments, a financial covenant or otherwise), except
(i) the Loan Documents, (ii) any agreement or instrument evidencing Surviving Debt,
(iii) any agreement or instrument evidencing Non-Recourse Debt, provided that the terms of
such Debt, and of such agreement or instrument, do not restrict distributions in respect of
Equity Interests in Subsidiaries directly or indirectly owning Borrowing Base Assets, (iv)
any agreement in effect at the time such Subsidiary becomes a Subsidiary of the Borrower, so
long as such agreement was not entered into solely in contemplation of such Person becoming
a Subsidiary of the Borrower or (v) with respect to agreements or instruments which limit
the ability of Subsidiaries to declare or pay dividends or pay distributions in respect of
its Equity Interests only, such agreements which impose any such restriction solely after
the occurrence of a default or event of default.




     (l) Amendment, Etc. of Material Contracts. Cancel or terminate any Material
Contract or consent to or accept any cancellation or termination thereof, amend or otherwise
modify any Material Contract or give any consent, waiver or approval thereunder, waive any
default under or breach of any Material Contract, agree in any manner to any other
amendment, modification or change of any term or condition of any Material Contract or take
any other action in connection with any Material Contract that would impair in any material
respect the value of the interest or rights of any Loan Party thereunder or that would
impair or otherwise adversely affect in any material respect the interest or rights, if any,
of any Agent or any Lender Party, or permit any of its Subsidiaries to do any of the
foregoing, in each case in a manner that could reasonably be expected to have a Material
Adverse Effect, in each case taking into account the effect of any agreements that
supplement or serve to substitute for, in whole or in part, such Material Contract.




     (m) Negative Pledge. Enter into or suffer to exist, or permit any of its
Subsidiaries to enter into or suffer to exist, any agreement prohibiting or conditioning the
creation or assumption of any Lien upon any of its property or assets (including, without



93









 







limitation, any Borrowing Base Assets), except (i) pursuant to the Loan Documents or
(ii) with respect to any property or assets other than the Borrowing Base Assets in
connection with




     (A) any Non-Recourse Debt permitted by Section 5.02(b)(iii)(E), provided that
the terms of such Debt, and of any agreement entered into and of any instrument
issued in connection therewith, (1) do not provide for or prohibit or condition the
creation of any Lien on any Borrowing Base Assets and are otherwise permitted by the
Loan Documents and (2) solely prohibit Liens on the property of the Person incurring
such Non-Recourse Debt and the Equity Interests in such Person,




     (B) any purchase money Debt permitted under Section 5.02(b)(iii)(A) solely to
the extent that the agreement or instrument governing such Debt prohibits a Lien on
the property acquired with the proceeds of such Debt,




     (C) any Capitalized Lease permitted by Section 5.02(b)(iii)(B) solely to the
extent that such Capitalized Lease prohibits a Lien on the property subject thereto,
or




     (D) any Debt outstanding on the date any Subsidiary of the Borrower becomes
such a Subsidiary (so long as such agreement was not entered into solely in
contemplation of such Subsidiary becoming a Subsidiary of the Borrower),




     (E) any Surviving Debt and any Refinancing Debt extending, refunding, or
refinancing such Surviving Debt, so long as the prohibitions or conditions contained
in such Refinancing Debt are no more restrictive than the corresponding provisions
contained in the Debt which is extended, refunded or refinanced thereby,




     (F) any unsecured Recourse Debt permitted by Section 5.02(b)(iii)(F) or other
Debt permitted by Section 5.02(b)(vii); and




     (G) any Recourse Debt permitted by Section 5.02(b)(iv).




     (n) Parent Guarantor as Holding Company. In the case of the Parent Guarantor,
not enter into or conduct any business, or engage in any activity (including, without
limitation, any action or transaction that is required or restricted with respect to the
Borrower and its Subsidiaries under Sections 5.01 and 5.02 without regard to any of the
enumerated exceptions to such covenants), other than (i) the holding of the direct and
indirect Equity Interests of the Borrower; (ii) the performance of the duties of sole
general partner of the Borrower through the Parent Guarantor’s indirect ownership of all of
the membership interests in such general partner; (iii) the performance of its Obligations
(subject to the limitations set forth in the Loan Documents) under each Loan Document to
which it is a party; (iv) the making of equity or subordinate debt Investments in the
Borrower and its Subsidiaries, provided each such Investment shall be on terms acceptable to
the Administrative Agent; and (v) activities incidental to each of the foregoing.



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     (o) Multiemployer Plans. Neither any Loan Party nor any ERISA Affiliate will
contribute to or be required to contribute to any Multiemployer Plan.




     (p) Management Agreements. The Borrower shall not and shall not permit any
Guarantor to enter into any Management Agreement with a third party manager after the date
hereof for any Borrowing Base Asset without the prior written consent of the Administrative
Agent (which shall not be unreasonably withheld), and after such approval, no such
Management Agreement shall be modified in any material respect or terminated without
Administrative Agent’s prior written approval, such approval not to be unreasonably
withheld. Administrative Agent may condition any approval of a new manager upon the
execution and delivery to Agent of a collateral assignment of such management agreement to
Agent and a subordination of the manager’s rights thereunder to the rights of the
Administrative Agent and the Lender Parties under the Loan Documents.



          SECTION 5.03. Reporting Requirements. So long as any Advance or any other Obligation
of any Loan Party under any Loan Document shall remain unpaid, any Letter of Credit shall be
outstanding or any Lender Party shall have any Commitment hereunder, the Borrower will furnish to
the Agents and the Lender Parties in accordance with Section 9.02(b):





     (a) Default Notice. As soon as possible and in any event within two Business
Days after the occurrence of each Default or any event, development or occurrence reasonably
expected to result in a Material Adverse Effect continuing on the date of such statement, a
statement of the Chief Financial Officer (or other Responsible Officer) of the Parent
Guarantor setting forth details of such Default or such event, development or occurrence and
the action that the Parent Guarantor has taken and proposes to take with respect thereto.




     (b) Annual Financials. As soon as available and in any event within 90 days
after the end of each Fiscal Year, a copy of the annual audit report for such year for the
Parent Guarantor and its Subsidiaries, including therein Consolidated balance sheets of the
Parent Guarantor and its Subsidiaries as of the end of such Fiscal Year and Consolidated
statements of income and a Consolidated statement of cash flows of the Parent Guarantor and
its Subsidiaries for such Fiscal Year (it being acknowledged that a copy of the annual audit
report filed by the Parent Guarantor with the Securities and Exchange Commission shall
satisfy the foregoing requirements), in each case accompanied by (x) an opinion acceptable
to the Administrative Agent of KPMG LLP or other independent public accountants of
recognized standing acceptable to the Required Lenders, and (y) if and as required by the
rules and regulations promulgated by the United States Securities and Exchange Commission, a
report of such independent public accountants as to the Borrower’s internal controls
required under Section 404 of the Sarbanes-Oxley Act of 2002, in each case certified in a
manner to which the Administrative Agent has not objected, together with (i) a certificate
of such accounting firm to the Lender Parties stating that in the course of the regular
audit of the business of the Parent Guarantor and its Subsidiaries, which audit was
conducted by such accounting firm in accordance with generally accepted auditing standards,
such accounting firm has obtained no knowledge of non-compliance with any of the covenants
contained in



95









 







Section 5.04, or if, in the opinion of such accounting firm, any such non-compliance
has occurred, a statement as to the nature thereof, (ii) a schedule in form satisfactory to
the Administrative Agent of the computations used by such accountants in determining, as of
the end of such Fiscal Year, compliance with the covenants contained in Section 5.04,
provided that in the event of any change in GAAP used in the preparation of such financial
statements, the Parent Guarantor shall also provide, if necessary for the determination of
compliance with Section 5.04, a statement of reconciliation conforming such financial
statements to GAAP and (iii) a certificate of the Chief Financial Officer (or other
Responsible Officer) of the Parent Guarantor stating that no Default has occurred and is
continuing or, if a Default has occurred and is continuing, a statement as to the nature
thereof and the action that the Parent Guarantor has taken and proposes to take with respect
thereto.




     (c) Quarterly Financials. As soon as available and in any event within 45 days
after the end of each of the first three quarters of each Fiscal Year, Consolidated balance
sheets of the Parent Guarantor and its Subsidiaries as of the end of such quarter and
Consolidated statements of income and a Consolidated statement of cash flows of the Parent
Guarantor and its Subsidiaries for the period commencing at the end of the previous fiscal
quarter and ending with the end of such fiscal quarter and Consolidated statements of income
and a Consolidated statement of cash flows of the Parent Guarantor and its Subsidiaries for
the period commencing at the end of the previous Fiscal Year and ending with the end of such
quarter, setting forth in each case in comparative form the corresponding figures for the
corresponding date or period of the preceding Fiscal Year, all in reasonable detail and duly
certified (subject to normal year-end audit adjustments) by the Chief Executive Officer,
Chief Financial Officer or Treasurer (or other Responsible Officer performing similar
functions) of the Parent Guarantor as having been prepared in accordance with GAAP (it being
acknowledged that a copy of the quarterly financials filed by the Parent Guarantor with the
Securities and Exchange Commission shall satisfy the foregoing requirements), together with
(i) a certificate of such officer stating that no Default has occurred and is continuing or,
if a Default has occurred and is continuing, a statement as to the nature thereof and the
action that the Parent Guarantor has taken and proposes to take with respect thereto and
(ii) a schedule in form satisfactory to the Administrative Agent of the computations used by
the Parent Guarantor in determining compliance with the covenants contained in Section 5.04,
provided that in the event of any change in GAAP used in the preparation of such financial
statements, the Parent Guarantor shall also provide, if necessary for the determination of
compliance with Section 5.04, a statement of reconciliation conforming such financial
statements to GAAP.




     (d) Borrowing Base Certificate. (i) As soon as available and in any event
within 45 days after the end of each calendar quarter, (ii) at the time any Proposed
Borrowing Base Asset is included in the definition of “Borrowing Base Asset,” (iii) at the
time any Borrowing Base Asset is the subject of a Transfer or a release of Liens such that
it no longer constitutes a Borrowing Base Asset or (iv) at any time a Borrowing Base Asset
fails to satisfy all of the Borrowing Base Conditions, a Borrowing Base Certificate, as at
the end of such quarter or as of the applicable date, certified by the Chief Financial



96









 







Officer (or other Responsible Officer performing similar functions) of the Parent
Guarantor.




     (e) Annual Budgets. As soon as available and in any event within 45 days after
the end of each Fiscal Year, forecasts prepared by management of the Parent Guarantor, in
form satisfactory to the Administrative Agent, of balance sheets, income statements and cash
flow statements on a quarterly basis for the then current Fiscal Year and on an annual basis
for each Fiscal Year thereafter until the Termination Date.




     (f) Reconciliation Statements. If, as a result of any change in accounting
principles and policies from those used in the preparation of the audited financial
statements referred to in Section 4.01(g), the Consolidated financial statements of the
Parent Guarantor and its Subsidiaries delivered pursuant to Section 5.03(b), (c) or (f) (i)
will differ in any material respect from the Consolidated financial statements that would
have been delivered pursuant to such Section had no such change in accounting principles and
policies been made, then (i) together with the first delivery of financial statements
pursuant to Section 5.03(b), (c) or (f) (i) following such change, Consolidated financial
statements of the Parent Guarantor and its Subsidiaries for the fiscal quarter immediately
preceding the fiscal quarter in which such change is made, prepared on a pro forma basis as
if such change had been in effect during such fiscal quarter, and (ii) together with each
delivery of financial statements pursuant to Section 5.03(b), (c) or (f) (i) following such
change, a written statement of the chief accounting officer or chief financial officer of
the Parent Guarantor setting forth the differences (including any differences that would
affect any calculations relating to the financial covenants set forth in Section 5.04) which
would have resulted if such financial statements had been prepared without giving effect to
such change.




     (g) Material Litigation. Promptly after the commencement thereof, notice of
all actions, suits, investigations, litigation and proceedings before any court or
governmental department, commission, board, bureau, agency or instrumentality, domestic or
foreign, affecting any Loan Party or any of its Subsidiaries of the type described in
Section 4.01(f), and promptly after the occurrence thereof, notice of any adverse change in
the status or the financial effect on any Loan Party or any of its Subsidiaries of the
Material Litigation from that described on Schedule 4.01(f) hereto.




     (h) Securities Reports. Promptly after the sending or filing thereof, copies
of all proxy statements, financial statements and reports that any Loan Party or any of its
Subsidiaries sends to the holders of its Equity Interests, and copies of all regular,
periodic and special reports, and all registration statements, that any Loan Party or any of
its Subsidiaries files with the Securities and Exchange Commission or any governmental
authority that may be substituted therefor, or with any national securities exchange.




     (i) Real Property. As soon as available and in any event within 15 days after
the end of each fiscal quarter of each Fiscal Year, a report supplementing Schedule 4.01(q)
hereto, including an identification of all owned and leased real property acquired or
disposed of by any Loan Party or any of its Subsidiaries during such fiscal quarter, a list
and description (including the street address, county or other relevant



97









 







jurisdiction, state, record owner, book value thereof and, in the case of leases of
property, lessor, lessee, expiration date and annual rental cost thereof) of all real
property acquired or leased by any Loan Party or any of its Subsidiaries during such fiscal
quarter and a description of such other changes in the information included in such
Schedules as may be necessary for such Schedules to be accurate and complete.




     (j) Assets Reports. As soon as available and in any event within 45 days after
the end of each quarter of each Fiscal Year, a report listing and describing (in detail
reasonably satisfactory to the Administrative Agent) all Assets of the Parent Guarantor and
its Subsidiaries as of the end of such quarter in form and substance reasonably satisfactory
to the Administrative Agent.




     (k) Environmental Conditions. Notice to the Administrative Agent (i) promptly
upon obtaining knowledge of any material violation of any Environmental Law affecting any
Asset or the operations thereof or the operations of any of its Subsidiaries, (ii) promptly
upon obtaining knowledge of any known release, discharge or disposal of any Hazardous
Materials at, from, or into any Asset which it reports in writing or is legally required to
report in writing to any governmental authority and which is material in amount or nature or
which could reasonably be expected to materially adversely affect the value of such Asset,
(iii) promptly upon its receipt of any written notice of material violation of any
Environmental Laws or of any material release, discharge or disposal of Hazardous Materials
in violation of any Environmental Laws or any matter that could reasonably be expected to
result in an Environmental Action, including a notice or claim of liability or potential
responsibility from any third party (including without limitation any federal, state or
local governmental officials) and including notice of any formal inquiry, proceeding,
demand, investigation or other action with regard to (A) such Loan Party’s or any other
Person’s operation of any Asset in compliance with Environmental Laws, (B) Hazardous
Materials contamination on, from or into any Asset, or (C) investigation or remediation of
off-site locations at which such Loan Party or any of its predecessors are alleged to have
directly or indirectly disposed of Hazardous Materials, or (iv) upon such Loan Party’s
obtaining knowledge that any expense or loss has been incurred by such governmental
authority in connection with the assessment, containment, removal or remediation of any
Hazardous Materials with respect to which such Loan Party or any Joint Venture could
reasonably be expected to incur material liability or for which a Lien may be imposed on any
Asset, provided that notice is required only for any of the events described in clauses
(i) through (iv) above that could reasonably be expected to result in a Material Adverse
Effect, could reasonably be expected to result in a material Environmental Action with
respect to any Borrowing Base Asset or could reasonably be expected to result in a Lien
against any Borrowing Base Asset.




     (l) Borrowing Base Asset Value. Promptly after discovery of any setoff, claim,
withholding or defense asserted or effected against any Loan Party, or to which any
Borrowing Base Asset is subject, which could reasonably be expected to (i) have a material
adverse effect on the value of a Borrowing Base Asset, (ii) have a Material Adverse Effect
or (iii) result in the imposition or assertion of a Lien against any



98









 







Borrowing Base Asset which is not a Permitted Lien, notice to the Administrative Agent
thereof.




     (m) Compliance with Borrowing Base Asset Conditions. Promptly after obtaining
actual knowledge of any condition or event which causes any Borrowing Base Asset to fail to
satisfy any of the Borrowing Base Conditions (other than those Borrowing Base Conditions, if
any, that have theretofore been waived by the Administrative Agent and the Required Lenders
with respect to any particular Borrowing Base Asset, to the extent of such waiver), notice
to the Administrative Agent thereof.




     (n) Appraisals. Promptly upon the written request of the Administrative Agent
or the Required Lenders and at the expense of the Borrower, Appraisals of the Borrowing
Base Assets that are the subject of such request, provided, that so long as no Event of
Default then exists, the Borrower shall not be required to deliver an Appraisal of a
Borrowing Base Asset more frequently than once during the term of the Facility (other than
the Appraisal required in connection with the extension of the Termination Date).




     (o) Other Information. Promptly, such other information respecting the
business, condition (financial or otherwise), operations, performance, properties or
prospects of any Loan Party or any of its Subsidiaries as the Administrative Agent, or any
Lender Party through the Administrative Agent, may from time to time reasonably request.




     (p) Management Agreements and Material Contracts. Promptly following execution
thereof by all parties thereto, a copy of any Management Agreement or Material Contract
entered into with respect to any Borrowing Base Asset after the date hereof.



          SECTION 5.04. Financial Covenants. So long as any Advance or any other Obligation of
any Loan Party under any Loan Document shall remain unpaid, any Letter of Credit shall be
outstanding or any Lender Party shall have, at any time after the Initial Extension of Credit, any
Commitment hereunder, the Parent Guarantor will:





     (a) Parent Guarantor Financial Covenants.




     (i) Maximum Leverage Ratio. Maintain as of each Test Date, a Leverage
Ratio of not greater than 0.60:1.00.




     (ii) Maximum Secured Recourse Debt Ratio. Maintain as of each Test
Date, a Secured Recourse Debt Ratio of not greater than 20%.




     (iii) Minimum Tangible Net Worth. Maintain at all times tangible net
worth of the Parent Guarantor and its Subsidiaries, as determined in accordance with
GAAP (but excluding accumulated depreciation on all Real Property), of not less than
the sum of $[                                        ] plus an amount equal to 75% times the net cash proceeds of
all issuances and primary sales of Equity Interests of the Parent Guarantor or any
of its Subsidiaries consummated following the Closing Date.




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     (iv) Minimum Ratio of Fixed Rate Debt for Borrowed Money and Debt for
Borrowed Money Subject to Hedge Agreements to Debt for Borrowed Money. Maintain
as of each Test Date, a ratio of fixed rate Debt for Borrowed Money and Debt for
Borrowed Money subject to Hedge Agreements to all Debt for Borrowed Money of not
less than 66.67%.




     (v) Maximum Dividend Payout Ratio. Maintain as of each Test Date, a
Dividend Payout Ratio of equal to or less than (A) 90% or (B) such greater amount as
may be required by applicable law to maintain status as a REIT for tax purposes.




     (vi) Minimum Fixed Charge Coverage Ratio. Maintain as of each Test
Date, a Fixed Charge Coverage Ratio of not less than 1.50:1.00.



          (b) Borrowing Base Covenants.





     (i) Maximum Facility Exposure to Borrowing Base Asset Value. Not
permit at any time the Facility Exposure at such time to exceed the Total Borrowing
Base Value at such time.




     (ii) Minimum Borrowing Base Debt Service Coverage Ratio. Maintain as
of each Test Date, a Borrowing Base Debt Service Coverage Ratio of not less than
1.50:1.00.




     (iii) Minimum Appraised Value. Not permit at any time the Appraised
Value of the Borrowing Base Assets in the aggregate to be less than $130,000,000.




     (iv) Minimum Number of Borrowing Base Assets. Not permit at any time
the number of Campus Housing Assets comprising the Borrowing Base Assets to be fewer
than ten.




     (v) Maximum Size of Individual Borrowing Base Asset. Not permit at any
time the Appraised Value of any individual Borrowing Base Asset to exceed 15% of the
Appraised Value of the Borrowing Base Assets in the aggregate.




     (vi) Minimum Weighted Average Occupancy of the Borrowing Base Assets.
Not permit at any time the average occupancy of the Borrowing Base Assets, weighted
based upon the number of beds comprising each Borrowing Base Asset, to equal less
than 80%.



     All calculations described above in Sections 5.04(a) and 5.04(b) that pertain to the fiscal
quarters of the Parent Guarantor ending on or prior to September 30, 2010 shall be made on a
pro forma basis, including to give effect to the IPO and the Formation Transactions. To the extent
any calculations described in Sections 5.04(a) or 5.04(b) are required to be made on any date of
determination other than the last day of a fiscal quarter of the Parent Guarantor, such
calculations shall be made on a pro forma basis to account for any acquisitions or dispositions of
Assets, and the incurrence or repayment of any Debt for Borrowed Money relating to such



100









 




Assets, that have occurred since the last day of the fiscal quarter of the Parent Guarantor
most recently ended. To the extent any calculations described in Sections 5.04(a) or 5.04(b) are
required to be made on a Test Date relating to an Advance, a merger permitted under
Section 5.02(d), a Transfer permitted under Section 5.02(e)(ii)(C) or the release of a Borrowing
Base Asset, such calculations shall be made both before and on a pro forma basis after giving
effect to such Advance, merger, Transfer or such other event, as applicable. All such calculations
shall be reasonably acceptable to the Administrative Agent.




          SECTION 5.05. Ground Lease Covenants.





     (a) Each Loan Party shall (i) pay or cause to be paid on or before the due date thereof
all Ground Lease Payments, (ii) perform and observe every covenant to be performed or
observed by a Loan Party under the applicable Ground Lease; (iii) refrain from doing
anything and not do or permit any act, event or omission, as a result of which, there is
reasonably likely to occur a default or breach under any Ground Lease; (iv) promptly give
Administrative Agent notice of any default under any Ground Lease upon learning of such
default and promptly deliver to Administrative Agent a copy of each notice of default and
all responses to such notice of default and all other material instruments, notices or
demands received or delivered by a Loan Party under or in connection with the applicable
Ground Lease; (v) promptly notify Administrative Agent in writing in the event of the
initiation of any litigation or arbitration proceeding affecting a Loan Party or the Real
Property under or in connection with the applicable Ground Lease; (vi) not voluntarily or
involuntarily, directly or indirectly, surrender, terminate or cancel any Ground Lease nor,
without the prior written consent of Administrative Agent, fail to exercise in a timely
manner any purchase option(s) or renewal option(s) contained in any Ground Lease; and (vii)
not modify, alter or amend any Ground Lease, either orally or in writing without the prior
written consent of the Administrative Agent. Any assignment, transfer, conveyance,
surrender, termination, cancellation, modification, alteration or amendment of any Ground
Lease in contravention of the foregoing shall be void and of no force and effect.




     (b) Each Loan Party acknowledges and agrees that no release or forbearance of any of
its obligations under any Ground Lease or otherwise shall release such Loan Party from any
of its obligations under the Loan Documents, including without limitation the performance of
all of the terms, provisions, covenants, conditions and agreements contained in any
applicable Ground Lease, to be kept, performed and complied with by such Loan Party therein.




     (c) In the event of a default by any Loan Party under any Ground Lease, Administrative
Agent may (but shall not be obligated to), in its sole discretion and without notice to any
Loan Party, cause such default or defaults by such Loan Party to be remedied and otherwise
take or perform such other actions as Administrative Agent may reasonably deem necessary or
desirable as a result thereof or in connection therewith. Borrower shall reimburse
Administrative Agent for all advances reasonably made and expenses reasonably incurred by
Administrative Agent in curing any such default(s) (including, without limitation,
reasonable attorneys’ fees), together with interest thereon from the date incurred until the
same is paid in full to Administrative Agent and all such



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sums so advanced shall be secured by the applicable Mortgage. The provisions of this
subsection are in addition to any other right or remedy given to or allowed Administrative
Agent under such Ground Lease or otherwise.




     (d) If any Ground Lease is cancelled or terminated and Administrative Agent or its
nominee shall acquire an interest in any new lease of the Real Property, each Loan Party
shall have no right, title or interest in or to the new lease or the leasehold estate
created by such new lease.




     (e) Each Loan Party shall from time to time within ten (10) Business Days of
Administrative Agent’s request to execute and deliver, use reasonable efforts to obtain from
the ground lessor, an estoppel certificate in a form reasonably acceptable to Administrative
Agent certifying to such matters as Administrative Agent may reasonably require, including
without limitation, the following: (a) the name of the tenant entitled to possession of the
leasehold estate under the applicable Ground Lease; (b) that the applicable Ground Lease is
in full force and effect and has not been modified or, if it has been modified, the date of
each such modification (together with copies of each modification); (c) the date to which
the fixed (or base) rent has been paid under the applicable Ground Lease; (d) the dates to
which all other fees or charges have been paid under the applicable Ground Lease; (e)
whether any notice of default has been sent to any Loan Party under the applicable Ground
Lease which has not been cured, and if such notice has been sent, the date it was sent and
the nature of the default; (f) to the best of the ground lessor’s knowledge, whether any
Loan Party is in default under such Ground Lease, and if so, the nature thereof in
reasonable detail.




     (f) Notwithstanding anything contained herein or otherwise to the contrary,
Administrative Agent shall not have any liability or obligation under any Ground Lease, by
virtue of its acceptance of the applicable Mortgage. Each Loan Party acknowledges and
agrees that Administrative Agent shall be liable for the obligations of a Loan Party arising
under any Ground Lease, as applicable, for only that period of time, if any, during which
Administrative Agent is in possession of the leasehold estate created thereby and has
acquired, by foreclosure, power of sale or otherwise, and is holding, all of such Loan
Party’s right, title and interest as tenant under the applicable Ground Lease.




     (g) Notwithstanding anything contained herein or otherwise to the contrary, each Loan
Party hereby assigns, transfers and sets over to Administrative Agent any and all rights and
interests that may arise in favor of such Loan Party in connection with or as a result of
the bankruptcy or insolvency of the ground lessor, as applicable, including, without
limitation, all of such Loan Party’s right, title and interest in, to and under §365 of the
Bankruptcy Code (11 U.S.C. §365), as the same may be amended, supplemented or modified from
time to time.




     (h) In the event that it is claimed by any governmental authority that any tax is due,
unpaid or payable by a Loan Party upon or in connection with any Ground Lease, such Loan
Party shall promptly either (a) pay such tax, charge or imposition when due and deliver to
Administrative Agent reasonably satisfactory proof of payment thereof or (b) contest such
tax in accordance with the applicable provisions of this Agreement. If



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liability for such tax is asserted against Administrative Agent, Administrative Agent
will give to such Loan Party prompt notice of such claim, and such Loan Party, upon
complying with the provisions of this Agreement shall have full right and authority to
contest such claim.




     (i) It shall be an immediate Event of Default hereunder if: (a) a Loan Party shall
fail in the payment of any Ground Lease Payments as and when the same is payable under the
applicable Ground Lease (unless waived by the ground lessor under such Ground Lease); (b)
there shall occur any default by a Loan Party under the applicable Ground Lease in the
observance or performance of any term, covenant or condition on the part of such Loan Party
to be observed or performed thereunder (unless waived by the lessor under such Ground
Lease); (c) any one or more of the events referred to in the applicable Ground Lease shall
occur which would cause the applicable Ground Lease to terminate without notice or action by
the ground lessor under such Ground Lease or which would entitle the ground lessor to
terminate such Ground Lease by giving notice to a Loan Party (unless waived by the lessor
under such Ground Lease); (d) the leasehold estate created by any Ground Lease shall be
surrendered or such Ground Lease shall be terminated or canceled for any reason or under any
circumstances, or (e) any of the terms, covenants or conditions of any Ground Lease shall in
any manner be materially modified, changed, supplemented, altered, or amended without the
prior written consent of Administrative Agent.



ARTICLE VI

EVENTS OF DEFAULT




          SECTION 6.01. Events of Default. If any of the following events (“Events of Default”)
shall occur and be continuing:





     (a) Failure to Make Payments When Due. (i) The Borrower shall fail to pay any
principal of any Advance when the same shall become due and payable or (ii) the Borrower
shall fail to pay any interest on any Advance, or any Loan Party shall fail to make any
other payment under any Loan Document, in each case under this clause (ii) within three
Business Days after the same becomes due and payable; or




     (b) Breach of Representations and Warranties. Any representation or warranty
made by any Loan Party (or any of its officers or the officers of its general partner or
managing member, as applicable) under or in connection with any Loan Document shall prove to
have been incorrect in any material respect when made; or




     (c) Breach of Certain Covenants. The Borrower shall fail to perform or observe
any term, covenant or agreement contained in Section 2.03(e), 2.14, 5.01(d), (e), (f), (i),
(j), (n), (o), (p), (q), (r) or (s), 5.02, 5.03 or 5.04; or




     (d) Other Defaults under Loan Documents. Any Loan Party shall fail to perform
or observe any other term, covenant or agreement contained in any Loan Document on its part
to be performed or observed if such failure shall remain unremedied for 30 days after the
earlier of the date on which (i) a Responsible Officer becomes aware



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of such failure or (ii) written notice thereof shall have been given to the Borrower by
any Agent or any Lender Party; or




     (e) Cross Defaults. (i) Any Loan Party or any Subsidiary thereof shall fail to
pay any principal of, premium or interest on or any other amount payable in respect of any
Material Debt when the same becomes due and payable (whether by scheduled maturity, required
prepayment, acceleration, demand or otherwise and after the expiration of any cure period
thereunder); or (ii) any other event shall occur or condition shall exist under any
agreement or instrument relating to any such Material Debt, if (A) the effect of such event
or condition is to permit the acceleration of the maturity of such Material Debt or
otherwise permit the holders thereof to cause such Material Debt to mature, and (B) such
event or condition shall remain unremedied or otherwise uncured for a period of 30 days; or
(iii) the maturity of any such Material Debt shall be accelerated or any such Material Debt
shall be declared to be due and payable or required to be prepaid or redeemed (other than by
a regularly scheduled required prepayment or redemption), purchased or defeased, or an offer
to prepay, redeem, purchase or defease such Material Debt shall be required to be made, in
each case prior to the stated maturity thereof; or




     (f) Insolvency Events. Any Loan Party or any Subsidiary thereof shall
generally not pay its debts as such debts become due, or shall admit in writing its
inability to pay its debts generally, or shall make a general assignment for the benefit of
creditors; or any proceeding shall be instituted by or against any Loan Party or any
Subsidiary thereof seeking to adjudicate it a bankrupt or insolvent, or seeking liquidation,
winding up, reorganization, arrangement, adjustment, protection, relief, or composition of
it or its debts under any law relating to bankruptcy, insolvency or reorganization or relief
of debtors, or seeking the entry of an order for relief or the appointment of a receiver,
trustee, or other similar official for it or for any substantial part of its property and,
in the case of any such proceeding instituted against it (but not instituted by it) that is
being diligently contested by it in good faith, either such proceeding shall remain
undismissed or unstayed for a period of 30 days or any of the actions sought in such
proceeding (including, without limitation, the entry of an order for relief against, or the
appointment of a receiver, trustee, custodian or other similar official for, it or any
substantial part of its property) shall occur; or any Loan Party or any Subsidiary thereof
shall take any corporate action to authorize any of the actions set forth above in this
subsection (f); or




     (g) Monetary Judgments. Any judgments or orders, either individually or in the
aggregate, for the payment of money in excess of $5,000,000 shall be rendered against any
Loan Party or any Subsidiary thereof and either (i) enforcement proceedings shall have been
commenced by any creditor upon such judgment or order or (ii) there shall be any period of
30 consecutive days during which a stay of enforcement of such judgment or order, by reason
of a pending appeal or otherwise, shall not be in effect; provided, however, that any such
judgment or order shall not give rise to an Event of Default under this Section 6.01(g) if
and so long as (A) the amount of such judgment or order which remains unsatisfied is covered
by a valid and binding policy of insurance between the respective Loan Party or Subsidiary
and the insurer covering full payment of such unsatisfied amount and (B) such insurer, which
shall be rated at least “A” by



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A.M. Best Company, has been notified, and has not disputed the claim made for payment,
of the amount of such judgment or order; or




     (h) Non-Monetary Judgments. Any non-monetary judgment or order shall be
rendered against any Loan Party or Subsidiary thereof that could reasonably be expected to
result in a Material Adverse Effect, and there shall be any period of 30 consecutive days
during which a stay of enforcement of such judgment or order, by reason of a pending appeal
or otherwise, shall not be in effect; or




     (i) Unenforceability of Loan Documents. Any provision of any Loan Document
after delivery thereof pursuant to Section 3.01 or 5.01(j) shall for any reason (other than
pursuant to the terms thereof) cease to be valid and binding on or enforceable against any
Loan Party which is party to it, or any such Loan Party shall so state in writing; or




     (j) Security Failure. Any Collateral Document or financing statement after
delivery thereof pursuant to Section 3.01 or 5.01(j) shall for any reason (other than
pursuant to the terms thereof) cease to create a valid and perfected first priority lien on
and security interest in the Collateral purported to be covered thereby; or




     (k) Change of Control. A Change of Control shall occur; or




     (l) ERISA Events. Any ERISA Event shall have occurred with respect to a Plan
and the sum (determined as of the date of occurrence of such ERISA Event) of the
Insufficiency of such Plan and the Insufficiency of any and all other Plans with respect to
which an ERISA Event shall have occurred and then exist (or the liability of the Loan
Parties and the ERISA Affiliates related to such ERISA Event) exceeds $5,000,000;


then, and in any such event, the Administrative Agent (i) shall at the request, or may with the
consent, of the Required Lenders, by notice to the Borrower, declare the Commitments of each Lender
Party and the obligation of each Lender Party to make Advances (other than Letter of Credit
Advances by an Issuing Bank or a Lender pursuant to Section 2.03(c) and Swing Line Advances by a
Lender pursuant to Section 2.02(b)) and of each Issuing Bank to issue Letters of Credit to be
terminated, whereupon the same shall forthwith terminate, and (ii) shall at the request, or may
with the consent, of the Required Lenders, (A) by notice to the Borrower, declare the Advances, all
interest thereon and all other amounts payable under this Agreement and the other Loan Documents to
be forthwith due and payable, whereupon the Advances, all such interest and all such amounts shall
become and be forthwith due and payable, without presentment, demand, protest or further notice of
any kind, all of which are hereby expressly waived by the Borrower, and (B) by notice to each party
required under the terms of any agreement in support of which a Letter of Credit is issued, request
that all Obligations under such agreement be declared to be due and payable; provided, however,
that in the event of an actual or deemed entry of an order for relief with respect to the Borrower
under any Bankruptcy Law, (y) the Commitments of each Lender Party and the obligation of each
Lender Party to make Advances (other than Letter of Credit Advances by an Issuing Bank or a Lender
pursuant to Section 2.03(c) and Swing Line Advances by a Lender pursuant to Section 2.02(b)) and of
each Issuing Bank to issue Letters of Credit shall automatically be terminated and (z) the
Advances,






105









 







all such interest and all such amounts shall automatically become and be due and payable, without
presentment, demand, protest or any notice of any kind, all of which are hereby expressly waived by
the Borrower.




          SECTION 6.02. Actions in Respect of the Letters of Credit upon Default. If any Event
of Default shall have occurred and be continuing, the Administrative Agent may, or shall at the
request of the Required Lenders, irrespective of whether it is taking any of the actions described
in Section 6.01 or otherwise, make demand upon the Borrower to, and forthwith upon such demand the
Borrower will, pay to the Administrative Agent on behalf of the Lender Parties in same day funds at
the Administrative Agent’s office designated in such demand, for deposit in the L/C Cash Collateral
Account, an amount equal to the aggregate Available Amount of all Letters of Credit then
outstanding. If at any time the Administrative Agent or the Issuing Bank determines that any funds
held in the L/C Cash Collateral Account are subject to any right or claim of any Person other than
the Agents and the Lender Parties with respect to the Obligations of the Loan Parties under the
Loan Documents, or that the total amount of such funds is less than the aggregate Available Amount
of all Letters of Credit, the Borrower will, forthwith upon demand by the Administrative Agent, pay
to the Administrative Agent, as additional funds to be deposited and held in the L/C Cash
Collateral Account, an amount equal to the excess of (a) such aggregate Available Amount over
(b) the total amount of funds, if any, then held in the L/C Cash Collateral Account that the
Administrative Agent, as the case may be, determines to be free and clear of any such right and
claim. Upon the drawing of any Letter of Credit for which funds are on deposit in the L/C Cash
Collateral Account, such funds shall be applied to reimburse the relevant Issuing Bank or Lenders,
as applicable, to the extent permitted by applicable law.




ARTICLE VII

GUARANTY




          SECTION 7.01. Guaranty; Limitation of Liability. (a) Each Guarantor hereby
absolutely, unconditionally and irrevocably guarantees the punctual payment when due, whether at
scheduled maturity or on any date of a required prepayment or by acceleration, demand or otherwise,
of all Obligations of each other Loan Party now or hereafter existing under or in respect of the
Loan Documents (including, without limitation, any extensions, modifications, substitutions,
amendments or renewals of any or all of the foregoing Obligations), whether direct or indirect,
absolute or contingent, and whether for principal, interest, premiums, fees, indemnities, contract
causes of action, costs, expenses or otherwise (such Obligations being the “Guaranteed
Obligations”), and agrees to pay any and all expenses (including, without limitation, fees and
expenses of counsel) incurred by the Administrative Agent or any other Secured Party in enforcing
any rights under this Agreement or any other Loan Document. Without limiting the generality of the
foregoing, each Guarantor’s liability shall extend to all amounts that constitute part of the
Guaranteed Obligations and would be owed by any other Loan Party to any Secured Party under or in
respect of the Loan Documents but for the fact that they are unenforceable or not allowable due to
the existence of a bankruptcy, reorganization or similar proceeding involving such other Loan
Party. This Guaranty is and constitutes a guaranty of payment and not merely of collection.




          (b) Each Guarantor, the Administrative Agent and each other Lender Party and, by its
acceptance of the benefits of this Guaranty, each other Secured Party, hereby confirms






106









 







that it is the intention of all such Persons that this Guaranty and the Obligations of each
Guarantor hereunder not constitute a fraudulent transfer or conveyance for purposes of Bankruptcy
Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar
foreign, federal or state law to the extent applicable to this Guaranty and the Obligations of each
Guarantor hereunder. To effectuate the foregoing intention, the Guarantors, the Administrative
Agent, the other Lender Parties and, by their acceptance of the benefits of this Guaranty, the
other Secured Parties hereby irrevocably agree that the Obligations of each Guarantor under this
Guaranty at any time shall be limited to the maximum amount as will result in the Obligations of
such Guarantor under this Guaranty not constituting a fraudulent transfer or conveyance.




          (c) Each Guarantor hereby unconditionally and irrevocably agrees that in the event any payment
shall be required to be made to any Secured Party under this Guaranty or any other guaranty, such
Guarantor will contribute, to the maximum extent permitted by law, such amounts to each other
Guarantor and each other guarantor so as to maximize the aggregate amount paid to the Secured
Parties under or in respect of the Loan Documents.




          SECTION 7.02. Guaranty Absolute. Each Guarantor guarantees that the Guaranteed
Obligations will be paid strictly in accordance with the terms of this Agreement and the other Loan
Documents, regardless of any law, regulation or order now or hereafter in effect in any
jurisdiction affecting any of such terms or the rights of the Administrative Agent or any other
Secured Party with respect thereto. The Obligations of each Guarantor under or in respect of this
Guaranty are independent of the Guaranteed Obligations or any other Obligations of any other Loan
Party under or in respect of this Agreement or the other Loan Documents, and a separate action or
actions may be brought and prosecuted against each Guarantor to enforce this Guaranty, irrespective
of whether any action is brought against the Borrower or any other Loan Party or whether the
Borrower or any other Loan Party is joined in any such action or actions. The liability of each
Guarantor under this Guaranty shall be irrevocable, absolute and unconditional irrespective of, and
each Guarantor hereby irrevocably waives any defenses it may now have or hereafter acquire in any
way relating to, any or all of the following:





     (a) any lack of validity or enforceability of any Loan Document or any agreement or
instrument relating thereto;




     (b) any change in the time, manner or place of payment of, or in any other term of, all
or any of the Guaranteed Obligations or any other Obligations of any other Loan Party under
or in respect of the Loan Documents, or any other amendment or waiver of or any consent to
departure from any Loan Document, including, without limitation, any increase in the
Guaranteed Obligations resulting from the extension of additional credit to the Borrower,
any other Loan Party or any of their Subsidiaries or otherwise;




     (c) any taking, exchange, release or non-perfection of any collateral, or any taking,
release or amendment or waiver of, or consent to departure from, any other guaranty, for all
or any of the Guaranteed Obligations;



107









 






     (d) any manner of application of collateral, or proceeds thereof, to all or any of the
Guaranteed Obligations, or any manner of sale or other disposition of any collateral for all
or any of the Guaranteed Obligations or any other Obligations of any Loan Party under the
Loan Documents or any other assets of any Loan Party or any of its Subsidiaries;




     (e) any change, restructuring or termination of the corporate structure or existence of
any Loan Party or any of its Subsidiaries;




     (f) any failure of the Administrative Agent or any other Secured Party to disclose to
any Loan Party any information relating to the business, condition (financial or otherwise),
operations, performance, properties or prospects of any other Loan Party now or hereafter
known to the Administrative Agent or such other Secured Party (each Guarantor waiving any
duty on the part of the Administrative Agent and each other Secured Party to disclose such
information);




     (g) the failure of any other Person to execute or deliver this Agreement, any other
Loan Document, any Guaranty Supplement or any other guaranty or agreement or the release or
reduction of liability of any Guarantor or other guarantor or surety with respect to the
Guaranteed Obligations; or




     (h) any other circumstance (including, without limitation, any statute of limitations)
or any existence of or reliance on any representation by the Administrative Agent or any
other Secured Party that might otherwise constitute a defense available to, or a discharge
of, any Loan Party or any other guarantor or surety.


This Guaranty shall continue to be effective or be reinstated, as the case may be, if at any time
any payment of any of the Guaranteed Obligations is rescinded or must otherwise be returned by any
Secured Party or any other Person upon the insolvency, bankruptcy or reorganization of the Borrower
or any other Loan Party or otherwise, all as though such payment had not been made.




          SECTION 7.03. Waivers and Acknowledgments. (a) Each Guarantor hereby unconditionally
and irrevocably waives promptness, diligence, notice of acceptance, presentment, demand for
performance, notice of nonperformance, default, acceleration, protest or dishonor and any other
notice with respect to any of the Guaranteed Obligations and this Guaranty and any requirement that
the Administrative Agent or any other Secured Party protect, secure, perfect or insure any Lien or
any property subject thereto or exhaust any right or take any action against any Loan Party or any
other Person or any collateral.




          (b) Each Guarantor hereby unconditionally and irrevocably waives any right to revoke this
Guaranty and acknowledges that this Guaranty is continuing in nature and applies to all Guaranteed
Obligations, whether existing now or in the future.




          (c) Each Guarantor hereby unconditionally and irrevocably waives (i) any defense arising by
reason of any claim or defense based upon an election of remedies by the Administrative Agent or
any other Secured Party that in any manner impairs, reduces, releases or otherwise adversely
affects the subrogation, reimbursement, exoneration, contribution or indemnification rights of such
Guarantor or other rights of such Guarantor to proceed against any






108









 







of the other Loan Parties, any other guarantor or any other Person or any collateral and
(ii) any defense based on any right of set-off or counterclaim against or in respect of the
Obligations of such Guarantor hereunder.




          (d) Each Guarantor acknowledges that the Administrative Agent may, without notice to or demand
upon such Guarantor and without affecting the liability of such Guarantor under this Guaranty,
foreclose under any mortgage by nonjudicial sale, and each Guarantor hereby waives any defense to
the recovery by the Administrative Agent and the other Secured Parties against such Guarantor of
any deficiency after such nonjudicial sale and any defense or benefits that may be afforded by
applicable law.




          (e) Each Guarantor hereby unconditionally and irrevocably waives any duty on the part of the
Administrative Agent or any other Secured Party to disclose to such Guarantor any matter, fact or
thing relating to the business, condition (financial or otherwise), operations, performance,
properties or prospects of the Borrower, any other Loan Party or any of their Subsidiaries now or
hereafter known by the Administrative Agent or such other Secured Party.




          (f) Each Guarantor acknowledges that it will receive substantial direct and indirect benefits
from the financing arrangements contemplated by this Agreement and the other Loan Documents and
that the waivers set forth in Section 7.02 and this Section 7.03 are knowingly made in
contemplation of such benefits.




          SECTION 7.04. Subrogation. Each Guarantor hereby unconditionally and irrevocably
agrees not to exercise any rights that it may now have or hereafter acquire against the Borrower,
any other Loan Party or any other insider guarantor that arise from the existence, payment,
performance or enforcement of such Guarantor’s Obligations under or in respect of this Guaranty,
this Agreement or any other Loan Document, including, without limitation, any right of subrogation,
reimbursement, exoneration, contribution or indemnification and any right to participate in any
claim or remedy of any Secured Party against the Borrower, any other Loan Party or any other
insider guarantor or any collateral, whether or not such claim, remedy or right arises in equity or
under contract, statute or common law, including, without limitation, the right to take or receive
from the Borrower, any other Loan Party or any other insider guarantor, directly or indirectly, in
cash or other property or by set-off or in any other manner, payment or security on account of such
claim, remedy or right, unless and until all of the Guaranteed Obligations and all other amounts
payable under this Guaranty shall have been paid in full in cash, all Letters of Credit shall have
expired or been terminated, all Secured Hedge Agreements shall have expired or been terminated and
the Commitments shall have expired or been terminated. If any amount shall be paid to any
Guarantor in violation of the immediately preceding sentence at any time prior to the latest of (a)
the payment in full in cash of the Guaranteed Obligations and all other amounts payable under this
Guaranty, (b) the termination in whole of the Commitments and (c) the latest date of expiration or
termination of all Letters of Credit and all Secured Hedge Agreements, such amount shall be
received and held in trust for the benefit of the Secured Parties, shall be segregated from other
property and funds of such Guarantor and shall forthwith be paid or delivered to the Administrative
Agent in the same form as so received (with any necessary endorsement or assignment) to be credited
and applied to the Guaranteed Obligations and all other amounts payable under this Guaranty,
whether matured or unmatured, in accordance with the terms of the Loan Documents. If (i) any
Guarantor shall






109









 







make payment to any Secured Party of all or any part of the Guaranteed Obligations, (ii) all
of the Guaranteed Obligations and all other amounts payable under this Guaranty shall have been
paid in full in cash, (iii) the termination in whole of the Commitments shall have occurred and
(iv) all Letters of Credit and all Secured Hedge Agreements shall have expired or been terminated,
the Administrative Agent and the other Secured Parties will, at such Guarantor’s request and
expense, execute and deliver to such Guarantor appropriate documents, without recourse and without
representation or warranty, necessary to evidence the transfer by subrogation to such Guarantor of
an interest in the Guaranteed Obligations resulting from such payment made by such Guarantor
pursuant to this Guaranty.




          SECTION 7.05. Guaranty Supplements. Upon the execution and delivery by any Person of
a Guaranty Supplement, (i) such Person shall be referred to as an “Additional Guarantor” and shall
become and be a Guarantor hereunder, and each reference in this Agreement to a “Guarantor” or a
“Loan Party” shall also mean and be a reference to such Additional Guarantor, and each reference in
any other Loan Document to a “Guarantor” shall also mean and be a reference to such Additional
Guarantor, and (ii) each reference herein to “this Agreement”, “this Guaranty”, “hereunder”,
“hereof” or words of like import referring to this Agreement and this Guaranty, and each reference
in any other Loan Document to the “Loan Agreement”, “Guaranty”, “thereunder”, “thereof” or words of
like import referring to this Agreement and this Guaranty, shall mean and be a reference to this
Agreement and this Guaranty as supplemented by such Guaranty Supplement.




          SECTION 7.06. Indemnification by Guarantors. (a) Without limitation on any other
Obligations of any Guarantor or remedies of the Administrative Agent or the Secured Parties under
this Agreement, this Guaranty or the other Loan Documents, each Guarantor shall, to the fullest
extent permitted by law, indemnify, defend and save and hold harmless the Administrative Agent,
each other Secured Party and each of their Affiliates and their respective officers, directors,
employees, agents, partners and advisors (each, an “Indemnified Party”) from and against, and shall
pay on demand, any and all claims, damages, losses, liabilities and expenses (including, without
limitation, reasonable fees and expenses of counsel) that may be incurred by or asserted or awarded
against any Indemnified Party in connection with or as a result of any failure of any Guaranteed
Obligations to be the legal, valid and binding obligations of any Loan Party enforceable against
such Loan Party in accordance with their terms.




          (b) Each Guarantor hereby also agrees that no Indemnified Party shall have any liability
(whether direct or indirect, in contract, tort or otherwise) to any of the Guarantors or any of
their respective Affiliates or any of their respective officers, directors, employees, agents and
advisors, and each Guarantor hereby agrees not to assert any claim against any Indemnified Party on
any theory of liability, for special, indirect, consequential or punitive damages arising out of or
otherwise relating to the Facilities, the actual or proposed use of the proceeds of the Advances or
the Letters of Credit, the Loan Documents or any of the transactions contemplated by the Loan
Documents.




          SECTION 7.07. Subordination. Each Guarantor hereby subordinates any and all debts,
liabilities and other Obligations owed to such Guarantor by each other Loan Party (the
“Subordinated Obligations”) to the Guaranteed Obligations to the extent and in the manner
hereinafter set forth in this Section 7.07.







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          (a) Prohibited Payments, Etc. Except during the continuance of a Default (including
the commencement and continuation of any proceeding under any Bankruptcy Law relating to any other
Loan Party), each Guarantor may receive regularly scheduled payments or payments made in the
ordinary course of business from any other Loan Party on account of the Subordinated Obligations.
After the occurrence and during the continuance of any Default (including the commencement and
continuation of any proceeding under any Bankruptcy Law relating to any other Loan Party), however,
unless the Administrative Agent otherwise agrees, no Guarantor shall demand, accept or take any
action to collect any payment on account of the Subordinated Obligations.




          (b) Prior Payment of Guaranteed Obligations. In any proceeding under any Bankruptcy
Law relating to any other Loan Party, each Guarantor agrees that the Secured Parties shall be
entitled to receive payment in full in cash of all Guaranteed Obligations (including all interest
and expenses accruing after the commencement of a proceeding under any Bankruptcy Law, whether or
not constituting an allowed claim in such proceeding (“Post Petition Interest”)) before such
Guarantor receives payment of any Subordinated Obligations.




          (c) Turn-Over. After the occurrence and during the continuance of any Default
(including the commencement and continuation of any proceeding under any Bankruptcy Law relating to
any other Loan Party), each Guarantor shall, if the Administrative Agent so requests, collect,
enforce and receive payments on account of the Subordinated Obligations as trustee for the Secured
Parties and deliver such payments to the Administrative Agent on account of the Guaranteed
Obligations (including all Post Petition Interest), together with any necessary endorsements or
other instruments of transfer, but without reducing or affecting in any manner the liability of
such Guarantor under the other provisions of this Guaranty.




          (d) Administrative Agent Authorization. After the occurrence and during the
continuance of any Default (including the commencement and continuation of any proceeding under any
Bankruptcy Law relating to any other Loan Party), the Administrative Agent is authorized and
empowered (but without any obligation to so do), in its discretion, (i) in the name of each
Guarantor, to collect and enforce, and to submit claims in respect of, Subordinated Obligations and
to apply any amounts received thereon to the Guaranteed Obligations (including any and all Post
Petition Interest), and (ii) to require each Guarantor (A) to collect and enforce, and to submit
claims in respect of, Subordinated Obligations and (B) to pay any amounts received on such
obligations to the Administrative Agent for application to the Guaranteed Obligations (including
any and all Post Petition Interest).




          SECTION 7.08. Continuing Guaranty. This Guaranty is a continuing guaranty and shall
(a) remain in full force and effect until the latest of (i) the payment in full in cash of the
Guaranteed Obligations and all other amounts payable under this Guaranty, (ii) the termination in
whole of the Commitments and (iii) the latest date of expiration or termination of all Letters of
Credit and all Secured Hedge Agreements, (b) be binding upon the Guarantors, their successors and
assigns and (c) inure to the benefit of and be enforceable by the Administrative Agent and the
other Secured Parties and their successors, transferees and assigns.




ARTICLE VIII

THE AGENTS






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          SECTION 8.01. Authorization and Action; Appointment of Supplemental Collateral Agents.
(a) Each Lender Party (in its capacities as a Lender, the Swing Line Bank (if applicable) and as
an Issuing Bank (if applicable) and on behalf of itself and its Affiliates as potential Hedge
Banks) hereby appoints and authorizes each Agent to take such action as agent on its behalf and to
exercise such powers and discretion under this Agreement and the other Loan Documents as are
delegated to such Agent by the terms hereof and thereof, together with such powers and discretion
as are reasonably incidental thereto. As to any matters not expressly provided for by the Loan
Documents (including, without limitation, enforcement or collection of the Notes), no Agent shall
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 Required Lenders, and such instructions shall be binding upon all Lender
Parties and all holders of Notes; provided, however, that no Agent shall be required to take any
action that exposes such Agent to personal liability or that is contrary to this Agreement or
applicable law. Each Agent agrees to give to each Lender Party prompt notice of each notice given
to it by the Borrower pursuant to the terms of this Agreement. Notwithstanding anything to the
contrary in any Loan Document, no Person identified as a syndication agent, documentation agent,
senior manager, joint lead arranger or joint book running manager, in such Person’s capacity as
such, shall have any obligations or duties to any Loan Party, the Administrative Agent or any other
Secured Party under any of such Loan Documents. In its capacity as the Lender Parties’ contractual
representative, Agents are each a “representative” of the Lender Parties as used within the meaning
of “Secured Party” under Section 9-102 of the Uniform Commercial Code.




          (b) Anything contained herein or in the Collateral Documents to the contrary notwithstanding,
the Collateral Agent may from time to time, when the Collateral Agent deems it to be necessary,
appoint one or more trustees, co-trustees, collateral co-agents or collateral subagents (each, a
“Supplemental Collateral Agent”) with respect to all or any part of the Collateral. In the event
that the Collateral Agent so appoints any Supplemental Collateral Agent with respect to any
Collateral, (i) such Supplemental Collateral Agent shall automatically be vested, in addition to
the Collateral Agent, with all rights, powers, privileges, interests and remedies of the Collateral
Agent under the Collateral Documents with respect to such Collateral; (ii) such Supplemental
Collateral Agent shall be deemed to be an “Agent” for purposes of this Agreement and the other Loan
Documents, and the provisions of Section 21 of the Security Agreement, this Article and
Section 9.04 hereof that refer to the Agents (or either of them) shall inure to the benefit of such
Supplemental Collateral Agent, and all references therein and in the other Loan Documents to the
Collateral Agent shall be deemed to be references to the Collateral Agent and/or such Supplemental
Collateral Agent, as the context may require; and (iii) the term “Collateral Agent”, when used
herein or in any applicable Collateral Document in relation to the Liens on or security interests
in such Collateral granted in favor of the Collateral Agent, and any rights, powers, privileges,
interests and remedies of the Collateral Agent with respect to such Collateral, shall be deemed to
include such Supplemental Collateral Agent; provided, however, that no such Supplemental Collateral
Agent shall be authorized to take any action with respect to any such Collateral unless and except
to the extent expressly authorized in writing by the Collateral Agent. Should any instrument in
writing from the Borrower or any other Loan Party be reasonably required by any Supplemental
Collateral Agent so appointed by the Collateral Agent to more fully or certainly vest in and
confirming to such Supplemental Collateral Agent such rights, powers, privileges and duties, the
Borrower shall, or shall cause such Loan Party to,






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execute, acknowledge and deliver any and all such instruments promptly upon request by the
Collateral Agent. If any Supplemental Collateral Agent, or successor thereto, shall die, become
incapable of acting, resign or be removed, all the rights, powers, privileges and duties of such
Supplemental Collateral Agent, to the extent permitted by law, shall automatically vest in and be
exercised by the Collateral Agent until the appointment of a new Supplemental Collateral Agent.




          SECTION 8.02. Agents’ Reliance, Etc. Neither any Agent nor any of its directors,
officers, agents or employees shall be liable for any action taken or omitted to be taken by it or
them under or in connection with the Loan Documents, except for its or their own gross negligence
or willful misconduct. Without limitation of the generality of the foregoing, each Agent: (a) in
the case of the Administrative Agent, may treat the payee of any Note as the holder thereof until
the Administrative Agent receives and accepts an Accession Agreement entered into by an Acceding
Lender as provided in Section 2.17 or an Assignment and Acceptance entered into by the Lender that
is the payee of such Note, as assignor, and an Eligible Assignee, as assignee, or, in the case of
any other Agent, such Agent has received notice from the Administrative Agent that it has received
and accepted such Accession Agreement or Assignment and Acceptance, as the case may be, in each
case as provided in Section 9.07; (b) may consult with legal counsel (including counsel for any
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 Party and shall not be responsible to any Lender Party for any statements, warranties or
representations (whether written or oral) made in or in connection with the Loan Documents;
(d) shall not have any duty to ascertain or to inquire as to the performance, observance or
satisfaction of any of the terms, covenants or conditions of any Loan Document on the part of any
Loan Party or the existence at any time of any Default under the Loan Documents or to inspect the
property (including the books and records) of any Loan Party; (e) shall not be responsible to any
Lender Party for the due execution, legality, validity, enforceability, genuineness, sufficiency or
value of, or the perfection or priority of any lien or security interest created or purported to be
created under or in connection with, any Loan Document or any other instrument or document
furnished pursuant thereto; and (f) shall incur no liability under or in respect of any Loan
Document by acting upon any notice, consent, certificate or other instrument or writing (which may
be by telegram, telecopy or telex or other electronic communication) believed by it to be genuine
and signed or sent by the proper party or parties.




          SECTION 8.03. Citibank and Affiliates. With respect to its Commitments, the Advances
made by it and the Notes issued to it, Citibank shall have the same rights and powers under the
Loan Documents as any other Lender Party and may exercise the same as though it were not an Agent;
and the term “Lender Party” or “Lender Parties” shall, unless otherwise expressly indicated,
include Citibank in its individual capacity. Citibank and its Affiliates may accept deposits from,
lend money to, act as trustee under indentures of, accept investment banking engagements from and
generally engage in any kind of business with, any Loan Party, any Subsidiary of any Loan Party and
any Person that may do business with or own securities of any Loan Party or any such Subsidiary,
all as if Citibank were not the Administrative Agent or the Collateral Agent and without any duty
to account therefor to the Lender Parties.







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          SECTION 8.04. Lender Party Credit Decision. Each Lender Party acknowledges that it
has, independently and without reliance upon any Agent or any other Lender Party and based on the
financial statements referred to in Section 4.01 and such other documents and information as it has
deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each
Lender Party also acknowledges that it will, independently and without reliance upon any Agent or
any other Lender Party and based on such documents and information as it shall deem appropriate at
the time, continue to make its own credit decisions in taking or not taking action under this
Agreement. Nothing in this Agreement or any other Loan Document shall require any Agent or any of
its respective directors, officers, agents or employees to carry out any “know your customer” or
other checks in relation to any Person on behalf of any Lender Party and each Lender Party confirms
to the Agents that it is solely responsible for any such checks it is required to carry out and
that it may not rely on any statement in relation to such checks made by any Agent or any of its
respective directors, officers, agents or employees.




          SECTION 8.05. Indemnification by Lender Parties. (a) Each Lender Party severally
agrees to indemnify each Agent (to the extent not promptly reimbursed by the Borrower) from and
against such Lender Party’s ratable share (determined as provided below) of any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever that may be imposed on, incurred by, or asserted
against such Agent in any way relating to or arising out of the Loan Documents or any action taken
or omitted by such Agent under the Loan Documents (collectively, the “Indemnified Costs”);
provided, however, that no Lender Party shall be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements resulting from any Agent’s gross negligence or willful misconduct as found in a
final, non-appealable judgment by a court of competent jurisdiction. Without limitation of the
foregoing, each Lender Party agrees to reimburse each Agent promptly upon demand for its ratable
share of any costs and expenses (including, without limitation, fees and expenses of counsel)
payable by the Borrower under Section 9.04, to the extent that such Agent is not promptly
reimbursed for such costs and expenses by the Borrower. In the case of any investigation,
litigation or proceeding giving rise to any Indemnified Costs, this Section 8.05 applies whether
any such investigation, litigation or proceeding is brought by any Lender Party or any other
Person.




          (b) Each Lender Party severally agrees to indemnify each Issuing Bank (to the extent not
promptly reimbursed by the Borrower) from and against such Lender Party’s ratable share (determined
as provided below) of any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever that may be
imposed on, incurred by, or asserted against such Issuing Bank in any way relating to or arising
out of the Loan Documents or any action taken or omitted by such Issuing Bank under the Loan
Documents; provided, however, that no Lender Party shall be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements resulting from such Issuing Bank’s gross negligence or willful misconduct as found in
a final, non-appealable judgment by a court of competent jurisdiction. Without limitation of the
foregoing, each Lender Party agrees to reimburse such Issuing Bank promptly upon demand for its
ratable share of any costs and expenses (including, without limitation, fees and expenses of
counsel) payable by the Borrower under Section 9.04, to






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the extent that such Issuing Bank is not promptly reimbursed for such costs and expenses by
the Borrower.




          (c) For purposes of this Section 8.05, the Lender Parties’ respective ratable shares of any
amount shall be determined, at any time, according to their respective Revolving Credit Commitments
at such time. The failure of any Lender Party to reimburse any Agent or any Issuing Bank, as the
case may be, promptly upon demand for its ratable share of any amount required to be paid by the
Lender Parties to such Agent or such Issuing Bank, as the case may be, as provided herein shall not
relieve any other Lender Party of its obligation hereunder to reimburse such Agent or such Issuing
Bank, as the case may be, for its ratable share of such amount, but no Lender Party shall be
responsible for the failure of any other Lender Party to reimburse such Agent or such Issuing
Bank, as the case may be, for such other Lender Party’s ratable share of such amount. Without
prejudice to the survival of any other agreement of any Lender Party hereunder, the agreement and
obligations of each Lender Party contained in this Section 8.05 shall survive the payment in full
of principal, interest and all other amounts payable hereunder and under the other Loan Documents.




          SECTION 8.06. Successor Agents. Any Agent may resign at any time by giving 30 days’
prior written notice thereof to the Lender Parties and the Borrower and may be removed at any time
for cause by the Required Lenders; provided, however, that any removal of the Administrative Agent
will not be effective until it has been replaced as Collateral Agent and it (or its Affiliate) has
been replaced as an Issuing Bank and released from all obligations in respect thereof. Upon any
such resignation or removal, the Required Lenders shall have the right to appoint a successor Agent
(which successor Agent shall be reasonably acceptable to the Borrower). If no successor Agent
shall have been so appointed by the Required Lenders, and shall have accepted such appointment,
within 30 days after the retiring Agent’s giving of notice of resignation or the Required Lenders’
removal of the retiring Agent, then the retiring Agent may, on behalf of the Lender Parties,
appoint a successor Agent, which shall be a commercial bank organized under the laws of the United
States or of any State thereof and having a combined capital and surplus of at least $250,000,000.
Upon the acceptance of any appointment as an Agent hereunder by a successor Agent, and, in the case
of a successor Collateral Agent, upon the execution and filing or recording of such financing
statements, or amendments thereto, and such amendments or supplements to the Mortgages and
Assignments of Leases, and such other instruments or notices, as may be necessary or desirable, or
as the Required Lenders may request, in order to continue the perfection of the Liens granted or
purported to be granted by the Collateral Documents, such successor Agent shall succeed to and
become vested with all the rights, powers, discretion, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged from its duties and obligations under the Loan
Documents. If within 45 days after written notice is given of the retiring Agent’s resignation or
removal under this Section 8.06 no successor Agent shall have been appointed and shall have
accepted such appointment, then on such 45th day (i) the retiring Agent’s resignation or removal
shall become effective, (ii) the retiring Agent shall thereupon be discharged from its duties and
obligations under the Loan Documents and (iii) the Required Lenders shall thereafter perform all
duties of the retiring Agent under the Loan Documents until such time, if any, as the Required
Lenders appoint a successor Agent as provided above. After any retiring Agent’s resignation or
removal hereunder as an Agent shall have become effective, the provisions of this Article VIII
shall inure to its benefit as to any actions taken or omitted to be taken by it while it was an
Agent under this Agreement.







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          SECTION 8.07. Relationship of Agents and Lenders. The relationship between Agents (or
either of them) and the Lenders, and the relationship among the Lenders, is not intended by the
parties to create, and shall not create, any trust, joint venture or partnership relation between
them.




ARTICLE IX

MISCELLANEOUS




          SECTION 9.01. Amendments, Etc. (a) No amendment or waiver of any provision of this
Agreement or the Notes or any other Loan Document, nor consent to any departure by any Loan Party
therefrom, shall in any event be effective unless the same shall be in writing and signed (or, in
the case of the Collateral Documents, consented to) by the Required Lenders, and then such waiver
or consent shall be effective only in the specific instance and for the specific purpose for which
given; provided, however, that no amendment, waiver or consent shall, unless in writing and signed
by all of the Lenders, do any of the following at any time:





     (i) modify the definition of Required Lenders or otherwise change the percentage vote
of the Lenders required to take any action under this Agreement or any other Loan Document,




     (ii) release the Borrower with respect to the Obligations or, except to the extent
expressly permitted under this Agreement, reduce or limit the obligations of any Guarantor
under Article VII or release such Guarantor or otherwise limit such Guarantor’s liability
with respect to the Guaranteed Obligations,




     (iii) release all or substantially all of the Collateral (other than pursuant to
Section 5.02(e) or 9.11) or permit the Loan Parties to encumber the Collateral, except as
expressly permitted in the Loan Documents prior to giving effect to such amendment,




     (iv) amend this Section 9.01,




     (v) increase the Commitments of the Lenders or subject the Lenders to any additional
obligations, other than as provided by Section 2.17,




     (vi) forgive or reduce the principal of, or interest on, the Obligations of the Loan
Parties under the Loan Documents or any fees or other amounts payable thereunder,




     (vii) postpone or extend any date fixed for any payment of principal of, or interest
on, the Notes or any fees or other amounts payable hereunder, or




     (viii) extend the Termination Date, other than as provided by Section 2.16;




provided further that no amendment, waiver or consent shall, unless in writing and
signed by the Swing Line Bank or each Issuing Bank, as the case may be, in addition to the
Lenders required above to take such action, affect the rights or obligations of the Swing
Line Bank or of the Issuing Banks, as the case may be, under this Agreement; and provided
further that no amendment, waiver or consent shall, unless in writing and signed by the
Administrative Agent or the Collateral Agent in addition to the Lenders required



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above to take such action, affect the rights or duties of the Administrative Agent or the
Collateral Agent, as the case may be, under this Agreement or the other Loan Documents.



          (b) In the event that (1) any Lender shall refuse to consent to a waiver or amendment to, or a
departure from, the provisions of this Agreement which requires the consent of all Lenders and that
has been consented to by the Administrative Agent and the Required Lenders or (2) any Lender Party
makes a demand for payment pursuant to Section 2.10(a) or (b) or (3) any Loan Party is required to
pay additional amounts to a Lender Party pursuant to Section 2.12(a) or (b) or (c) or (4) any
Lender fails to make any Advance to be made by it as part of any Borrowing on a date when the other
Lenders make their Advances as contemplated under this Agreement (any such Lender, a “Potential
Assignor Lender”), then the Borrower shall have the right, upon written demand to such Potential
Assignor Lender and the Administrative Agent given within 30 days after the first date on which
such consent was solicited in writing from the Lenders by the Administrative Agent or the first
date on which the Lender Party made a demand for payment or failed to make the Advance (a
“Potential Assignment Event Date”), to cause such Potential Assignor Lender to assign its rights
and obligations under this Agreement at par (including, without limitation, its Commitment or
Commitments, the Advances owing to it and the Note or Notes, if any, held by it) to an Eligible
Assignee designated by the Borrower and approved by the Administrative Agent (such approval not to
be unreasonably withheld) (a “Replacement Lender”), provided that (i) as of such Potential
Assignment Event Date, no Default or Event of Default shall have occurred and be continuing, and
(ii) with respect to clause (1) above only, as of the date of the Borrower’s written demand to
replace such Potential Assignor Lender, no Default or Event of Default shall have occurred and be
continuing other than a Default or Event of Default that resulted solely from the subject matter of
the waiver or amendment for which such consent was being solicited from the Lenders by the
Administrative Agent. The Replacement Lender shall purchase such interests of the Potential
Assignor Lender and shall assume the rights and obligations of the Potential Assignor Lender under
this Agreement upon execution by the Replacement Lender of an Assignment and Acceptance delivered
pursuant to Section 9.07. Any Lender that becomes a Potential Assignor Lender agrees that, upon
receipt of notice from the Borrower given in accordance with this Section 9.01(b) it shall promptly
execute and deliver an Assignment and Acceptance with a Replacement Lender as contemplated by this
Section.




          SECTION 9.02. Notices, Etc. (a) All notices and other communications provided for
hereunder shall be either (x) in writing (including telecopier communication) and mailed,
telecopied or delivered by hand or by overnight courier service, (y) as and to the extent set forth
in Section 9.02(b) and in the proviso to this Section 9.02(a), in an electronic medium and
delivered as set forth in Section 9.02(b) or (z) as and to the extent expressly permitted in this
Agreement, transmitted by e-mail, provided that such e-mail shall in all cases include an
attachment (in PDF format or similar format) containing a legible signature of the person providing
such notice, if to the Borrower, at its address at 2100 Rexford Road, Suite 414, Charlotte, North
Carolina 28211, Attention: Donald L. Bobbitt, Jr., with a copy to Bradley Arant Boult Cummings LLP,
1819 Fifth Avenue North, Birmingham, Alabama 35203, Attention: Dawn Helms Sharff or, if applicable,
at donnie.bobbitt@campuscrest.com (with a copy to dsharff@babc.com) (and in the case of
transmission by e mail, with a copy by U.S. mail to 2100 Rexford Road, Suite 414, Charlotte, North
Carolina 28211, Attention: Donald L. Bobbitt, Jr., with a copy to Bradley Arant Boult Cummings LLP,
1819 Fifth Avenue North, Birmingham,






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Alabama 35203, Attention: Dawn Helms Sharff); if to any Initial Lender, at its Domestic
Lending Office or, if applicable, at the telecopy number or e-mail address specified opposite its
name on Schedule I hereto (and in the case of a transmission by e-mail, with a copy by U.S. mail to
its Domestic Lending Office); if to any other Lender Party, at its Domestic Lending Office or, if
applicable, at the telecopy number or e-mail address specified in the Assignment and Acceptance
pursuant to which it became a Lender Party (and in the case of a transmission by e-mail, with a
copy by U.S. mail to its Domestic Lending Office); if to the Initial Issuing Bank, at its address
at 1615 Brett Road, New Castle, Delaware 19720, Attention: Bank Loan Syndications Department, or,
if applicable, at GLAgentOfficeOps@citigroup.com (and in the case of a transmission by e-mail, with
a copy by U.S. mail to 1615 Brett Road, New Castle, Delaware 19720, Attention: Bank Loan
Syndications Department); and if to the Administrative Agent, the Collateral Agent or the Swing
Line Bank, at its address at 1615 Brett Road, New Castle, Delaware 19720, Attention: Bank Loan
Syndications Department, or, if applicable, at GLAgentOfficeOps @citigroup.com (and in the case of
a transmission by e-mail, with a copy by U.S. mail to 1615 Brett Road, New Castle, Delaware 19720,
Attention: Bank Loan Syndications Department) or, as to the Borrower or any Agent, at such other
address as shall be designated by such party in a written notice to the other parties and, as to
each other party, at such other address as shall be designated by such party in a written notice to
the Borrower and the Administrative Agent. All notices, demands, requests, consents and other
communications described in this clause (a) shall be effective (i) if delivered by hand, including
any overnight courier service, upon personal delivery, (ii) if delivered by mail, three (3)
Business Days after the date such notice, demand, request, consent or other communication is
deposited in the mails, (iii) if delivered by posting to an Approved Electronic Platform, an
Internet website or a similar telecommunication device requiring that a user have prior access to
such Approved Electronic Platform, website or other device (to the extent permitted by
Section 9.02(b) to be delivered thereunder), when such notice, demand, request, consent and other
communication shall have been made generally available on such Approved Electronic Platform,
Internet website or similar device to the class of Person being notified (regardless of whether any
such Person must accomplish, and whether or not any such Person shall have accomplished, any action
prior to obtaining access to such items, including registration, disclosure of contact information,
compliance with a standard user agreement or undertaking a duty of confidentiality) and such Person
has been notified in respect of such posting that a communication has been posted to the Approved
Electronic Platform, provided that if requested by any Lender Party, the Administrative Agent shall
deliver a copy of the Communications to such Lender Party by e-mail or telecopier and (iv) if
delivered by electronic mail or any other telecommunications device, when receipt is confirmed by
electronic mail as provided in this clause (a); provided, however, that notices and communications
to any Agent pursuant to Article II, III or VIII or to the Collateral Agent under the Collateral
Documents shall not be effective until received by such Agent or the Collateral Agent, as the case
may be. Delivery by telecopier of an executed counterpart of a signature page to any amendment or
waiver of any provision of this Agreement or the Notes or of any Exhibit hereto to be executed and
delivered hereunder shall be effective as delivery of an original executed counterpart thereof.
Each Lender Party agrees (i) to notify the Administrative Agent in writing of such Lender Party’s
e-mail address to which a notice may be sent by electronic transmission (including by electronic
communication) on or before the date such Lender Party becomes a party to this Agreement (and from
time to time thereafter to ensure






118









 







that the Administrative Agent has on record an effective e-mail address for such Lender Party)
and (ii) that any notice may be sent to such e-mail address.




          (b) Notwithstanding clause (a) (unless the Administrative Agent requests that the provisions
of clause (a) be followed) and any other provision in this Agreement or any other Loan Document
providing for the delivery of any Approved Electronic Communication by any other means, the Loan
Parties shall deliver all Approved Electronic Communications to the Administrative Agent by
properly transmitting such Approved Electronic Communications in an electronic/soft medium in a
format acceptable to the Administrative Agent to oploanswebadmin@citigroup.com or such other
electronic mail address (or similar means of electronic delivery) as the Administrative Agent may
notify to the Borrower. Nothing in this clause (b) shall prejudice the right of the Administrative
Agent or any Lender Party to deliver any Approved Electronic Communication to any Loan Party in any
manner authorized in this Agreement or to request that the Borrower effect delivery in such manner.




          (c) Each of the Lender Parties and each Loan Party agrees that the Administrative Agent may,
but shall not be obligated to, make the Approved Electronic Communications available to the Lender
Parties by posting such Approved Electronic Communications on IntraLinksTM or a substantially
similar electronic platform chosen by the Administrative Agent to be its electronic transmission
system (the “Approved Electronic Platform”). Although the Approved Electronic Platform and its
primary web portal are secured with generally-applicable security procedures and policies
implemented or modified by the Administrative Agent from time to time (including, as of the Closing
Date, a dual firewall and a User ID/Password Authorization System) and the Approved Electronic
Platform is secured through a single-user-per-deal authorization method whereby each user may
access the Approved Electronic Platform only on a deal-by-deal basis, each of the Lender Parties
and each Loan Party acknowledges and agrees that the distribution of material through an electronic
medium is not necessarily secure and that there are confidentiality and other risks associated with
such distribution. In consideration for the convenience and other benefits afforded by such
distribution and for the other consideration provided hereunder, the receipt and sufficiency of
which is hereby acknowledged, each of the Lender Parties and each Loan Party hereby approves
distribution of the Approved Electronic Communications through the Approved Electronic Platform and
understands and assumes the risks of such distribution




          (d) THE APPROVED ELECTRONIC PLATFORM AND THE APPROVED ELECTRONIC COMMUNICATIONS ARE PROVIDED
“AS IS” AND “AS AVAILABLE”. NONE OF THE ADMINISTRATIVE AGENT NOR ANY OF ITS DIRECTORS, OFFICERS,
AGENTS OR EMPLOYEES WARRANT THE ACCURACY, ADEQUACY OR COMPLETENESS OF THE APPROVED ELECTRONIC
COMMUNICATIONS OR THE APPROVED ELECTRONIC PLATFORM AND EACH EXPRESSLY DISCLAIMS ANY LIABILITY FOR
ERRORS OR OMISSIONS IN THE APPROVED ELECTRONIC COMMUNICATIONS OR THE APPROVED ELECTRONIC PLATFORM.
NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY
OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR
FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY THE ADMINISTRATIVE AGENT OR ANY OF ITS
DIRECTORS, OFFICERS, AGENTS OR






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EMPLOYEES IN CONNECTION WITH THE APPROVED ELECTRONIC COMMUNICATIONS OR THE APPROVED ELECTRONIC
PLATFORM.




          (e) Each of the Lender Parties and each Loan Party agrees that the Administrative Agent may,
but (except as may be required by applicable law) shall not be obligated to, store the Approved
Electronic Communications on the Approved Electronic Platform in accordance with the Administrative
Agent’s generally-applicable document retention procedures and policies.




          SECTION 9.03. No Waiver; Remedies. No failure on the part of any Lender Party or any
Agent to exercise, and no delay in exercising, any right hereunder or under any Note shall operate
as a waiver thereof; nor shall any single or partial exercise of any such right preclude any other
or further exercise thereof or the exercise of any other right. The remedies herein provided are
cumulative and not exclusive of any remedies provided by law.




          SECTION 9.04. Costs and Expenses. (a) Each Loan Party agrees jointly and severally
to pay on demand (i) all reasonable out-of-pocket costs and expenses of each Agent in connection
with the preparation, execution, delivery, administration, modification and amendment of the Loan
Documents (including, without limitation, (A) all due diligence, collateral review, syndication,
transportation, computer, duplication, appraisal, audit, insurance, consultant, search, filing and
recording fees and expenses, (B) the reasonable fees and expenses of counsel for such Agent with
respect thereto (including, without limitation, with respect to reviewing and advising on any
matters required to be completed by the Loan Parties on a post-closing basis), with respect to
advising such Agent as to its rights and responsibilities, or the perfection, protection or
preservation of rights or interests, under the Loan Documents, with respect to negotiations with
any Loan Party or with other creditors of any Loan Party or any of its Subsidiaries arising out of
any Default or any events or circumstances that may give rise to a Default and with respect to
presenting claims in or otherwise participating in or monitoring any bankruptcy, insolvency or
other similar proceeding involving creditors’ rights generally and any proceeding ancillary thereto
and (C) the reasonable fees and expenses of counsel for such Agent with respect to the preparation,
execution, delivery and review of any documents and instruments at any time delivered pursuant to
Sections 3.01, 3.02, 5.01(j) or 5.01(k) and (ii) all reasonable out-of-pocket costs and expenses of
each Agent and each Lender Party in connection with the enforcement (whether through negotiations,
legal proceedings or otherwise) of the Loan Documents, whether in any action, suit or litigation,
or any bankruptcy, insolvency or other similar proceeding affecting creditors’ rights generally
(including, without limitation, the reasonable fees and expenses of counsel for such Agent and each
Lender Party with respect thereto).




          (b) Each Loan Party agrees to indemnify, defend and save and hold harmless each Indemnified
Party from and against, and shall pay on demand, any and all claims, damages, losses, liabilities
and expenses (including, without limitation, reasonable fees and expenses of counsel) that may be
incurred by or asserted or awarded against any Indemnified Party, in each case arising out of or in
connection with or by reason of (including, without limitation, in connection with any
investigation, litigation or proceeding or preparation of a defense in connection therewith)
(i) the Facilities, the actual or proposed use of the proceeds of the Advances or the Letters of
Credit, the Loan Documents or any of the transactions contemplated






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thereby or (ii) the actual or alleged presence of Hazardous Materials on any property of any
Loan Party or any of its Subsidiaries or any Environmental Action relating in any way to any Loan
Party or any of its Subsidiaries, except to the extent such claim, damage, loss, liability or
expense is found in a final, non-appealable judgment by a court of competent jurisdiction to have
resulted from such Indemnified Party’s gross negligence or willful misconduct. In the case of an
investigation, litigation or other proceeding to which the indemnity in this Section 9.04(b)
applies, such indemnity shall be effective whether or not such investigation, litigation or
proceeding is brought by any Loan Party, its directors, shareholders or creditors or an Indemnified
Party, whether or not any Indemnified Party is otherwise a party thereto and whether or not the
transactions contemplated by the Loan Documents are consummated. Each Loan Party also agrees not
to assert any claim against any Agent, any Lender Party or any of their Affiliates, or any of their
respective officers, directors, employees, agents and advisors, on any theory of liability, for
special, indirect, consequential or punitive damages arising out of or otherwise relating to the
Facilities, the actual or proposed use of the proceeds of the Advances or the Letters of Credit,
the Loan Documents or any of the transactions contemplated by the Loan Documents.




          (c) If any payment of principal of, or Conversion of, any Eurodollar Rate Advance is made by
the Borrower to or for the account of a Lender Party other than on the last day of the Interest
Period for such Advance, as a result of a payment or Conversion pursuant to Section 2.06,
2.09(b)(i), 2.10(d) or 2.17(e), acceleration of the maturity of the Notes pursuant to Section 6.01
or for any other reason, or if the Borrower fails to make any payment or prepayment of an Advance
for which a notice of prepayment has been given or that is otherwise required to be made, whether
pursuant to Section 2.04, 2.06 or 6.01 or otherwise, the Borrower shall, upon demand by such Lender
Party (with a copy of such demand to the Administrative Agent), pay to the Administrative Agent for
the account of such Lender Party any amounts required to compensate such Lender Party for any
additional losses, costs or expenses that it may reasonably incur as a result of such payment or
Conversion or such failure to pay or prepay, as the case may be, including, without limitation, any
loss, cost or expense incurred by reason of the liquidation or reemployment of deposits or other
funds acquired by any Lender Party to fund or maintain such Advance.




          (d) If any Loan Party fails to pay when due any costs, expenses or other amounts payable by it
under any Loan Document, including, without limitation, fees and expenses of counsel and
indemnities, such amount may be paid on behalf of such Loan Party by any Agent or any Lender Party,
in its sole discretion.




          (e) Without prejudice to the survival of any other agreement of any Loan Party hereunder or
under any other Loan Document, the agreements and obligations of the Borrower and the other Loan
Parties contained in Sections 2.10 and 2.12, Section 7.06 and this Section 9.04 shall survive the
payment in full of principal, interest and all other amounts payable hereunder and under any of the
other Loan Documents.




          SECTION 9.05. Right of Set-off. Upon (a) the occurrence and during the continuance of
any Event of Default and (b) the making of the request or the granting of the consent specified by
Section 6.01 to authorize the Administrative Agent to declare the Notes due and payable pursuant to
the provisions of Section 6.01, each Agent and each Lender Party and






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each of their respective Affiliates is hereby authorized at any time and from time to time, to
the fullest extent permitted by law, to set off and otherwise apply any and all deposits (general
or special, time or demand, provisional or final) at any time held and other indebtedness at any
time owing by such Agent, such Lender Party or such Affiliate to or for the credit or the account
of the Borrower or any other Loan Party against any and all of the Obligations of the Borrower or
such Loan Party now or hereafter existing under the Loan Documents, irrespective of whether such
Agent or such Lender Party shall have made any demand under this Agreement or such Note or Notes
and although such obligations may be unmatured.




          SECTION 9.06. Binding Effect. This Agreement shall become effective when it shall
have been executed by the Borrower, each Guarantor named on the signature pages hereto and the
Administrative Agent shall have been notified by each Initial Lender and each Initial Issuing Bank
that such Initial Lender or such Initial Issuing Bank, as the case may be, has executed it and
thereafter shall be binding upon and inure to the benefit of the Borrower, the Guarantors named on
the signature pages hereto and each Agent and each Lender Party and their respective successors and
assigns, except that neither the Borrower nor any other Loan Party shall have the right to assign
its rights hereunder or any interest herein without the prior written consent of the Lender
Parties.




          SECTION 9.07. Assignments and Participations; Replacement Notes. (a) Each Lender may
(and, if demanded by the Borrower in accordance with Section 9.01(b) will) assign to one or more
Eligible Assignees all or a portion of its rights and obligations under this Agreement (including,
without limitation, all or a portion of its Commitment or Commitments, the Advances owing to it and
the Note or Notes held by it); provided, however, that (i) each such assignment shall be of a
uniform, and not a varying, percentage of all rights and obligations under and in respect of one or
more of the Facilities, (ii) except in the case of an assignment to a Person that, immediately
prior to such assignment, was a Lender, an Affiliate of any Lender or a Fund Affiliate of any
Lender or an assignment of all of a Lender’s rights and obligations under this Agreement, the
aggregate amount of the Commitments being assigned to such Eligible Assignee pursuant to such
assignment (determined as of the date of the Assignment and Acceptance with respect to such
assignment) shall in no event be less than $5,000,000 under each Facility or an integral multiple
of $1,000,000 in excess thereof (or such lesser amount as shall be approved by the Administrative
Agent and, so long as no Default shall have occurred and be continuing at the time of effectiveness
of such assignment, the Borrower), (iii) each such assignment shall be to an Eligible Assignee,
(iv) each such assignment made as a result of a demand by the Borrower pursuant to Section 9.01(b)
shall be an assignment of all rights and obligations of the assigning Lender under this Agreement,
(v) no such assignments shall be permitted (A) until the Administrative Agent shall have notified
the Lender Parties that syndication of the Commitments hereunder has been completed, without the
consent of the Administrative Agent, and (B) at any other time without the consent of the
Administrative Agent (which consent shall not be unreasonably withheld) and (vi) the parties to
each such assignment shall execute and deliver to the Administrative Agent, for its acceptance and
recording in the Register, an Assignment and Acceptance, together with any Note or Notes subject to
such assignment and, except if such assignment is being made by a Lender to an Affiliate or Fund
Affiliate of such Lender, a processing and recordation fee of $3,500; provided, however, that for
each such assignment made as a result of a demand by the Borrower pursuant to Section 9.01(b), the
Borrower shall pay to the Administrative Agent the $3,500 processing and recordation fee.







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          (b) Upon such execution, delivery, acceptance and recording, from and after the effective date
specified in such Assignment and Acceptance, (i) the assignee thereunder shall be a party hereto
and, to the extent that rights and obligations hereunder have been assigned to it pursuant to such
Assignment and Acceptance, have the rights and obligations of a Lender or Issuing Bank, as the case
may be, hereunder and (ii) the Lender or Issuing Bank assignor thereunder shall, to the extent that
rights and obligations hereunder have been assigned by it pursuant to such Assignment and
Acceptance, relinquish its rights (other than its rights under Sections 2.10, 2.12, 7.06, 8.05 and
9.04 to the extent any claim thereunder relates to an event arising prior to such assignment) and
be released from its obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all of the remaining portion of an assigning Lender’s or Issuing Bank’s rights
and obligations under this Agreement, such Lender or Issuing Bank shall cease to be a party
hereto).




          (c) By executing and delivering an Assignment and Acceptance, each Lender Party assignor
thereunder and each assignee thereunder confirm to and agree with each other and the other parties
thereto and hereto as follows: (i) other than as provided in such Assignment and Acceptance, such
assigning Lender Party makes no representation or warranty and assumes no responsibility with
respect to any statements, warranties or representations made in or in connection with any Loan
Document or the execution, legality, validity, enforceability, genuineness, sufficiency or value
of, or the perfection or priority of any lien or security interest created or purported to be
created under or in connection with, any Loan Document or any other instrument or document
furnished pursuant thereto; (ii) such assigning Lender Party makes no representation or warranty
and assumes no responsibility with respect to the financial condition of any Loan Party or the
performance or observance by any Loan Party of any of its obligations under any Loan Document or
any other instrument or document furnished pursuant thereto; (iii) such assignee confirms that it
has received a copy of this Agreement, together with copies of the financial statements referred to
in Section 4.01 and such other documents and information as it has deemed appropriate to make its
own credit analysis and decision to enter into such Assignment and Acceptance; (iv) such assignee
will, independently and without reliance upon any Agent, such assigning Lender Party or any other
Lender Party and based on such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under this Agreement;
(v) such assignee confirms that it is an Eligible Assignee; (vi) such assignee appoints and
authorizes each Agent to take such action as agent on its behalf and to exercise such powers and
discretion under the Loan Documents as are delegated to such Agent by the terms hereof and thereof,
together with such powers and discretion as are reasonably incidental thereto; and (vii) such
assignee agrees that it will perform in accordance with their terms all of the obligations that by
the terms of this Agreement are required to be performed by it as a Lender or Issuing Bank, as the
case may be.




          (d) The Administrative Agent shall maintain at its address referred to in Section 9.02 a copy
of each Assignment and Acceptance delivered to and accepted by it and a register for the
recordation of the names and addresses of the Lender Parties and the Commitment under each Facility
of, and principal amount of the Advances owing under each Facility to, each Lender Party from time
to time (the “Register”). The entries in the Register shall be conclusive and binding for all
purposes, absent manifest error, and the Borrower, the Agents and the Lender Parties may treat each
Person whose name is recorded in the Register as a Lender Party hereunder for all purposes of this
Agreement. The Register shall be available for






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inspection by the Borrower or any Agent or any Lender Party at any reasonable time and from
time to time upon reasonable prior notice.




          (e) Upon its receipt of an Assignment and Acceptance executed by an assigning Lender Party and
an assignee, together with any Note or Notes subject to such assignment, the Administrative Agent
shall, if such Assignment and Acceptance has been completed and is in substantially the form of
Exhibit D hereto, (i) accept such Assignment and Acceptance, (ii) record the information contained
therein in the Register and (iii) give prompt notice thereof to the Borrower and each other Agent.
In the case of any assignment by a Lender, within five Business Days after receipt of a request
therefor, the Borrower, at its own expense, shall, if requested by the applicable Lender, execute
and deliver to the Administrative Agent in exchange for the surrendered Note or Notes a substitute
Note to the order of such Eligible Assignee in an amount equal to the Commitment assumed by it
under each Facility pursuant to such Assignment and Acceptance and, if any assigning Lender has
retained a Commitment hereunder under such Facility, a substitute Note to the order of such
assigning Lender in an amount equal to the Commitment retained by it hereunder. Such substitute
Note or Notes, if any, shall be in an aggregate principal amount equal to the aggregate principal
amount of such surrendered Note or Notes, shall be dated the effective date of such Assignment and
Acceptance and shall otherwise be in substantially the form of Exhibit A hereto.




          (f) Each Issuing Bank may assign to one or more Eligible Assignees all or a portion of its
rights and obligations under the undrawn portion of its Letter of Credit Commitment at any time;
provided, however, that (i) except in the case of an assignment to a Person that immediately prior
to such assignment was an Issuing Bank or an assignment of all of an Issuing Bank’s rights and
obligations under this Agreement, the amount of the Letter of Credit Commitment of the assigning
Issuing Bank being assigned pursuant to each such assignment (determined as of the date of the
Assignment and Acceptance with respect to such assignment) shall in no event be less than
$5,000,000 and shall be in an integral multiple of $1,000,000 in excess thereof, (ii) each such
assignment shall be to an Eligible Assignee and (iii) the parties to each such assignment shall
execute and deliver to the Administrative Agent, for its acceptance and recording in the Register,
an Assignment and Acceptance, together with a processing and recordation fee of $3,500, provided
that such fee shall not be payable if the assigning Issuing Bank is making such assignment
simultaneously with the assignment in its capacity as a Lender of all or a portion of its Revolving
Credit Commitment to the same Eligible Assignee.




          (g) Each Lender Party may sell participations to one or more Persons (other than any Loan
Party or any of its Affiliates) in or to all or a portion of its rights and obligations under this
Agreement (including, without limitation, all or a portion of its Commitments, the Advances owing
to it and the Note or Notes (if any) held by it); provided, however, that (i) such Lender Party’s
obligations under this Agreement (including, without limitation, its Commitments) shall remain
unchanged, (ii) such Lender Party shall remain solely responsible to the other parties hereto for
the performance of such obligations, (iii) such Lender Party shall remain the holder of any such
Note for all purposes of this Agreement, (iv) the Borrower, the Agents and the other Lender Parties
shall continue to deal solely and directly with such Lender Party in connection with such Lender
Party’s rights and obligations under this Agreement, (v) no participant under any such
participation shall have any right to approve any amendment or waiver of any provision of any Loan
Document, or any consent to any departure by any Loan






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Party therefrom, except to the extent that such amendment, waiver or consent would reduce the
principal of, or interest on, the Notes or any fees or other amounts payable hereunder, in each
case to the extent subject to such participation, or postpone any date fixed for any payment of
principal of, or interest on, the Notes or any fees or other amounts payable hereunder, in each
case to the extent subject to such participation, or release all or substantially all of the
Collateral and (vi) if, at the time of such sale, such Lender Party was entitled to payments under
Section 2.12(a) in respect of United States withholding tax with respect to interest paid at such
date, then, to such extent, the term Taxes shall include (in addition to withholding taxes that may
be imposed in the future or other amounts otherwise includable in Taxes) United States withholding
tax, if any, applicable with respect to such participant on such date, provided that such
participant complies with the requirements of Section 2.12(e) as if it were a Lender hereunder.




          (h) Any Lender Party may, in connection with any assignment or participation or proposed
assignment or participation pursuant to this Section 9.07, disclose to the assignee or participant
or proposed assignee or participant any information relating to the Loan Parties (or any of them)
furnished to such Lender Party by or on behalf of any Loan Party; provided, however, that prior to
any such disclosure, the assignee or participant or proposed assignee or participant shall agree to
preserve the confidentiality of any Information received by it from such Lender Party on the same
terms as provided in Section 9.10.




          (i) Notwithstanding any other provision set forth in this Agreement, any Lender Party may at
any time create a security interest in all or any portion of its rights under this Agreement
(including, without limitation, the Advances owing to it and the Note or Notes held by it) in favor
of any Federal Reserve Bank in accordance with Regulation A of the Board of Governors of the
Federal Reserve System.




          (j) Upon notice to the Borrower from the Administrative Agent or any Lender of the loss,
theft, destruction or mutilation of any Lender’s Note, the Borrower will execute and deliver, in
lieu of such original Note, a replacement promissory note, identical in form and substance to, and
dated as of the same date as, the Note so lost, stolen or mutilated, subject to delivery by such
Lender to the Borrower of an affidavit of lost note and indemnity in customary form. Upon the
execution and delivery of the replacement Note, all references herein or in any of the other Loan
Documents to the lost, stolen or mutilated Note shall be deemed references to the replacement Note.




          (k) If for any reason other than a good faith dispute any Lender shall fail or refuse to abide
by its obligations hereunder, and such Lender shall not have cured such failure or refusal within
five (5) Business Days of its occurrence (a “Lender Default”), then, in addition to the rights and
remedies that may be available to Administrative Agent, Lenders, or any Loan Party at law or in
equity, such Lender’s right to vote on matters related to this Agreement other than those matters
set forth in Section 9.01(a)(v), (vi), (vii) or (viii), and to participate in the administration of
the Advances and this Agreement, shall be suspended during the pendency of such failure or refusal;
provided, however, that during the existence of such Lender Default, if such defaulting Lender is
the only Lender to refuse to consent to a matter set forth in Section 9.01(a)(v), (vi), (vii) or
(viii), then the proviso in the first sentence of Section 9.01(b) shall not apply if such Lender
Default is continuing. Administrative Agent shall have the right, but not






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the obligation, in its sole discretion, to acquire at par all of such Lender’s Commitment,
including its Pro Rata Share in the Obligations under this Agreement. In the event that
Administrative Agent does not exercise its right to so acquire all of such Lender’s interests, then
each Lender for whom there does not exist a Lender Default (each, a “Current Party”) shall then,
thereupon, have the right, but not the obligation, in its sole discretion to acquire at par (or if
more than one Current Party exercises such right, each Current Party shall have the right to
acquire, pro rata) such Lender’s Commitment, including its Pro Rata Share in the outstanding
Obligations under this Agreement.




          SECTION 9.08. Execution in Counterparts. This Agreement may be executed in any number
of counterparts and by different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together shall constitute one and
the same agreement. Delivery of an executed counterpart of a signature page to this Agreement by
telecopier shall be effective as delivery of an original executed counterpart of this Agreement.




          SECTION 9.09. No Liability of the Issuing Banks. The Borrower assumes all risks of
the acts or omissions of any beneficiary or transferee of any Letter of Credit with respect to its
use of such Letter of Credit. Neither any Issuing Bank nor any of its officers or directors shall
be liable or responsible for: (a) the use that may be made of any Letter of Credit or any acts or
omissions of any beneficiary or transferee in connection therewith; (b) the validity, sufficiency
or genuineness of documents, or of any endorsement thereon, even if such documents should prove to
be in any or all respects invalid, insufficient, fraudulent or forged; (c) payment by such Issuing
Bank against presentation of documents that do not comply with the terms of a Letter of Credit,
including failure of any documents to bear any reference or adequate reference to the Letter of
Credit; or (d) any other circumstances whatsoever in making or failing to make payment under any
Letter of Credit, except that the Borrower shall have a claim against such Issuing Bank, and such
Issuing Bank shall be liable to the Borrower, to the extent of any direct, but not consequential,
damages suffered by the Borrower that the Borrower proves were caused by (i) such Issuing Bank’s
willful misconduct or gross negligence as determined in a final, non-appealable judgment by a court
of competent jurisdiction in determining whether documents presented under any Letter of Credit
comply with the terms of the Letter of Credit or (ii) such Issuing Bank’s willful failure to make
lawful payment under a Letter of Credit after the presentation to it of a draft and certificates
strictly complying with the terms and conditions of the Letter of Credit. In furtherance and not
in limitation of the foregoing, such Issuing Bank may accept documents that appear on their face to
be in order, without responsibility for further investigation, regardless of any notice or
information to the contrary.




          SECTION 9.10. Confidentiality. (a) Each of the Agents, the Lender Parties and the
Issuing Bank agrees to maintain the confidentiality of the Information (as defined below), except
that Information may be disclosed (i) to its Affiliates and to its and its Affiliates’ respective
managers, administrators, trustees, partners, directors, officers, employees, agents, advisors and
other representatives (it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and instructed to keep such Information
confidential), (ii) to the extent requested by any regulatory authority purporting to have
jurisdiction over it (including any self-regulatory authority, such as the National Association of
Insurance Commissioners), (iii) to the extent required by applicable laws or






126









 







regulations or by any subpoena or similar legal process, (iv) to any other party hereto,
(v) in connection with the exercise of any remedies hereunder or under any other Loan Document or
any action or proceeding relating to this Agreement or any other Loan Document or the enforcement
of rights hereunder or thereunder, (vi) subject to an agreement containing provisions at least as
restrictive as those of this Section, (vii) to any assignee of or Participant in, or any
prospective assignee of or Participant in, any of its rights or obligations under this Agreement,
(viii) to any actual or prospective party (or its managers, administrators, trustees, partners,
directors, officers, employees, agents, advisors and other representatives) to any swap, derivative
or other transaction under which payments are to be made by reference to the Borrower and its
obligations, this Agreement or payments hereunder, (ix) to any rating agency, (x) the CUSIP Service
Bureau or any similar organization, (xi) with the consent of the Borrower or (xii) to the extent
such Information (A) becomes publicly available other than as a result of a breach of this Section
or (B) becomes available to such Agent, such Lender Party, the Issuing Bank or any of their
respective Affiliates on a non-confidential basis from a source other than a Loan Party or any of
its Subsidiaries without such Agent, such Lender Party, the Issuing Bank or any of their respective
Affiliates having knowledge that a duty of confidentiality to the Loan Parties or any of their
Subsidiaries has been breached. For purposes of this Section, “Information” means all information
received from a Loan Party or any of its Subsidiaries (including the Fee Letter and any information
obtained based on a review of the books and records of the Parent Guarantor or any of its
Subsidiaries) relating to any Loan Party or any of their Subsidiaries or any of their respective
businesses. Any Person required to maintain the confidentiality of Information as provided in this
Section shall be considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such Information as such
Person would accord to its own confidential information.




          (b) Certain of the Lender Parties may enter into this Agreement and take or not take action
hereunder or under the other Loan Documents on the basis of information that does not contain
material non-public information with respect to any of the Loan Parties, any of their Subsidiaries
or their respective securities (“Restricting Information”). Other Lender Parties may enter into
this Agreement and take or not take action hereunder or under the other Loan Documents on the basis
of information that may contain Restricting Information. Each Lender Party acknowledges that
United States federal and state securities laws prohibit any person from purchasing or selling
securities on the basis of material, non-public information concerning the issuer of such
securities or, subject to certain limited exceptions, from communicating such information to any
other Person. None of any Agent or any of its respective directors, officers, agents or employees
shall, by making any Communications (including Restricting Information) available to a Lender
Party, by participating in any conversations or other interactions with a Lender Party or
otherwise, make or be deemed to make any statement with regard to or otherwise warrant that any
such information or Communication does or does not contain Restricting Information nor shall any
Agent or any of its respective directors, officers, agents or employees be responsible or liable in
any way for any decision a Lender Party may make to limit or to not limit its access to Restricting
Information. In particular, none of any Agent or any of its respective directors, officers, agents
or employees (i) shall have, and each Agent, on behalf of itself and each of its directors,
officers, agents and employees, hereby disclaims, any duty to ascertain or inquire as to whether or
not a Lender Party has or has not limited its access to Restricting Information, such Lender
Party’s policies or






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procedures regarding the safeguarding of material, nonpublic information or such Lender
Party’s compliance with applicable laws related thereto or (ii) shall have, or incur, any liability
to any Loan Party, any Lender Party or any of their respective Affiliates, directors, officers,
agents or employees arising out of or relating to any Agent or any of its respective directors,
officers, agents or employees providing or not providing Restricting Information to any Lender
Party, other than as found by a court of competent jurisdiction to have resulted from the gross
negligence or willful misconduct of any Agent or any of its respective directors, officers, agents
or employees.




          (c) Each Loan Party agrees that (i) all Communications it provides to any Agent intended for
delivery to the Lender Parties whether by posting to the Approved Electronic Platform or otherwise
shall be clearly and conspicuously marked “PUBLIC” if such Communications are determined by the
Loan Parties in good faith not to contain Restricting Information which, at a minimum, shall mean
that the word “PUBLIC” shall appear prominently on the first page thereof, (ii) by marking
Communications “PUBLIC,” each Loan Party shall be deemed to have authorized the Agents and the
Lender Parties to treat such Communications as either publicly available information or not
material information (although such Communications shall remain subject to the confidentiality
undertakings of Section 9.10(a)) with respect to such Loan Party or its securities for purposes of
United States Federal and state securities laws, (iii) all Communications marked “PUBLIC” may be
delivered to all Lender Parties and may be made available through a portion of the Approved
Electronic Platform designated “Public Side Information” and (iv) the Agents shall be entitled to
treat any Communications that are not marked “PUBLIC” as Restricting Information and may post such
Communications to a portion of the Approved Electronic Platform not designated “Public Side
Information” (and shall not post such Communications to a portion of the Approved Electronic
Platform designated “Public Side Information”). Neither Agent nor any of its respective Affiliates
shall be responsible for any statement or other designation by a Loan Party regarding whether a
Communication contains or does not contain material non-public information with respect to any of
the Loan Parties or their securities nor shall the Agents or any of their respective Affiliates
incur any liability to any Loan Party, any Lender Party or any other Person for any action taken by
any Agent or any of its respective Affiliates based upon such statement or designation, including
any action as a result of which Restricting Information is provided to a Lender Party that may
decide not to take access to Restricting Information. Nothing in this Section 9.10(c) shall modify
or limit a Person’s obligations under Section 9.10 with regard to Communications and the
maintenance of the confidentiality of or other treatment of Information.




          (d) Each Lender Party acknowledges that circumstances may arise that require it to refer to
Communications that might contain Restricting Information. Accordingly, each Lender Party agrees
that it will nominate at least one designee to receive Communications (including Restricting
Information) on its behalf and identify such designee (including such designee’s contact
information) in writing to the Administrative Agent. Each Lender Party agrees to notify the
Administrative Agent from time to time of such Lender Party’s designee’s e-mail address to which
notice of the availability of Restricting Information may be sent by electronic transmission.




          (e) Each Lender Party acknowledges that Communications delivered hereunder and under the other
Loan Documents may contain Restricting Information and that






128









 







such Communications are available to all Lender Parties generally. Each Lender Party that
elects not to take access to Restricting Information does so voluntarily and, by such election,
acknowledges and agrees that the Agents and other Lender Parties may have access to Restricting
Information that is not available to such electing Lender Party. Each such electing Lender Party
acknowledges the possibility that, due to its election not to take access to Restricting
Information, it may not have access to any Communications (including, without being limited to, the
items required to be made available to the Administrative Agent in Section 5.03 unless or until
such Communications (if any) have been filed or incorporated into documents which have been filed
with the Securities and Exchange Commission by the Parent). None of the Loan Parties, Agents or
any Lender Party with access to Restricting Information shall have any duty to disclose such
Restricting Information to such electing Lender Party or to use such Restricting Information on
behalf of such electing Lender Party, and shall not be liable for the failure to so disclose or
use, such Restricting Information.




          (f) Sections 9.10(b), (c), (d) and (e) are designed to assist the Agents, the Lender Parties
and the Loan Parties, in complying with their respective contractual obligations and applicable law
in circumstances where certain Lender Parties express a desire not to receive Restricting
Information notwithstanding that certain Communications hereunder or under the other Loan Documents
or other information provided to the Lender Parties hereunder or thereunder may contain Restricting
Information. None of any Agent or any of its respective directors, officers, agents or employees
warrants or makes any other statement with respect to the adequacy of such provisions to achieve
such purpose nor does any Agent or any of its respective directors, officers, agents or employees
warrant or make any other statement to the effect that a Loan Party’s or Lender Party’s adherence
to such provisions will be sufficient to ensure compliance by such Loan Party or Lender Party with
its contractual obligations or its duties under applicable law in respect of Restricting
Information and each of the Lender Parties and each Loan Party assumes the risks associated
therewith.




          SECTION 9.11. Release of Collateral. (a) Upon (i) the sale, lease, transfer or other
disposition of any item of Collateral of any Loan Party (including, without limitation, (x) as a
result of a sale of the Equity Interests in the Loan Party that owns such Collateral, and (y) any
Transfer pursuant to Section 5.02(e)(ii)(B) or (C)) that is permitted by the terms of the Loan
Documents or (ii) any designation of any Borrowing Base Asset as a non-Borrowing Base Asset that is
permitted by Section 5.02(e)(ii)(C), then, in either such event, the Collateral Agent will, at the
Borrower’s expense, execute and deliver to the applicable Loan Party such documents as such Loan
Party may reasonably request to evidence the release of such item of Collateral from the assignment
and security interest granted under the Collateral Document in accordance with the terms of the
Loan Documents.




          (b) Upon the latest to occur of (i) the payment in full in cash of the Secured Obligations,
(ii) the termination in whole of the Commitments and (iii) the termination or expiration of all
Letters of Credit and all Secured Hedge Agreements, the Liens granted by the Collateral Documents
shall terminate and all rights to the Collateral shall revert to the applicable Loan Party. Upon
any such termination, the Collateral Agent will, at the Borrower’s expense, execute and deliver to
the applicable Loan Parties such documents as such Loan Parties shall reasonably request to
evidence such termination.







129









 








          SECTION 9.12. Patriot Act Notification. Each Lender and each Agent (for itself and
not on behalf of any Lender) hereby notifies the Loan Parties that pursuant to the requirements of
the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Patriot
Act”), it is required to obtain, verify and record information that identifies each Loan Party,
which information includes the name and address of such Loan Party and other information that will
allow such Lender or such Agent, as applicable, to identify such Loan Party in accordance with the
Patriot Act. The Parent Guarantor and the Borrower shall, and shall cause each of their
Subsidiaries to, provide, to the extent commercially reasonable, such information and take such
actions as are reasonably requested by any Agents or any Lenders in order to assist the
Administrative Agent and the Lenders in maintaining compliance with the Patriot Act.




          SECTION 9.13. Jurisdiction, Etc. (a) With respect to all matters arising out of or
relating to this Agreement, any of the other Loan Documents, or any other letter agreement or other
undertaking concerning the financing contemplated therein, each of the parties hereto hereby
irrevocably and unconditionally, on behalf of itself, its properties, and to the extent it may
lawfully do so, its parent entities, present and future subsidiaries, affiliates, transferees,
assigns, acquirers, officers, directors, employees, partners, members, shareholders, and successors
in interest, (i) submits to the exclusive jurisdiction of the U.S. District Court for the Southern
District of New York State or, if that court does not have subject jurisdiction, in any State court
located in the City and County of New York; (ii) agrees that all such matters may be heard and
determined in such courts, (iii) waives, to the fullest extent it may effectively do so, the
defense of an inconvenient forum, (iv) agrees that a final judgment of such courts shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law, and (v) waives any immunity (sovereign or otherwise) from jurisdiction of
any court or from any legal process or setoff to which its or its properties or assets may be
entitled.




          (b) Each of the parties hereto irrevocably and unconditionally waives, to the fullest extent
it may legally and effectively do so, any objection that it may now or hereafter have to the laying
of venue of any suit, action or proceeding arising out of or relating to this Agreement or any of
the other Loan Documents to which it is a party in any New York State or Federal court. Each of
the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense
of an inconvenient forum to the maintenance of such action or proceeding in any such court.




          SECTION 9.14. Governing Law. This Agreement and the Notes shall be governed by, and
construed in accordance with, the laws of the State of New York.




          SECTION 9.15. WAIVER OF JURY TRIAL. EACH OF THE BORROWER, THE OTHER LOAN PARTIES, THE
AGENTS AND THE LENDER PARTIES IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR
RELATING TO ANY OF THE LOAN DOCUMENTS, THE ADVANCES, THE LETTERS OF CREDIT OR THE ACTIONS OF ANY
AGENT OR ANY LENDER PARTY IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.







130









 








[Balance of page intentionally left blank]




131









 





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




	 	 	 	 	 	 	 	 	 	 	 

	 	 	BORROWER:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	CAMPUS CREST COMMUNITIES OPERATING PARTNERSHIP, LP	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	Campus Crest Communities GP, LLC,

Its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	Campus Crest Communities, Inc.	 	 
	 	 	 	 	 	 	Its Sole Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	Name: Donald L. Bobbitt, Jr.	 	 
	 

	 	 	 	 	 	 	 	Title: Chief Financial Officer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	PARENT GUARANTOR:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	CAMPUS CREST COMMUNITIES, INC.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	Name: Donald L. Bobbitt, Jr.	 	 
	 	 	 	 	Title: Chief Financial Officer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	SUBSIDIARY GUARANTORS:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	CAMPUS CREST AT STEPHENVILLE, LP	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	Campus Crest GP II, LLC	 	 
	 	 	 	 	Its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Name: Michael S. Hartnett	 	 
	 	 	 	 	 	 	Title: Manager	 	 






 









 






	 	 	 	 	 	 	 	 	 

	 	 	CAMPUS CREST AT LUBBOCK, LP  
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Campus Crest GP II, LLC	 	 
	 	 	 	 	Its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name: Michael S. Hartnett	 	 
	 

	 	 	 	 	 	Title: Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	CAMPUS CREST AT WACO, LP
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Campus Crest GP II, LLC	 	 
	 	 	 	 	Its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name: Michael S. Hartnett	 	 
	 

	 	 	 	 	 	Title: Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	CAMPUS CREST AT WICHITA FALLS, LP
	 
	 	 	By:	 	Campus Crest GP II, LLC	 	 
	 	 	 	 	Its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name: Michael S. Hartnett	 	 
	 

	 	 	 	 	 	Title: Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	CAMPUS CREST AT SAN MARCOS, LP
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Campus Crest GP II, LLC	 	 
	 	 	 	 	Its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name: Michael S. Hartnett	 	 
	 

	 	 	 	 	 	Title: Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	CAMPUS CREST AT JACKSONVILLE, AL, LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Campus Crest Properties, LLC	 	 
	 	 	 	 	Its Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name: Michael S. Hartnett	 	 
	 

	 	 	 	 	 	Title: Manager	 	 






 









 






	 	 	 	 	 	 	 	 	 

	 	 	CAMPUS CREST AT MOBILE PHASE II, LLC  
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Campus Crest Properties, LLC	 	 
	 	 	 	 	Its Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name: Michael S. Hartnett	 	 
	 

	 	 	 	 	 	Title: Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	CAMPUS CREST AT CHENEY, LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Campus Crest Properties, LLC	 	 
	 	 	 	 	Its Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name: Michael S. Hartnett	 	 
	 

	 	 	 	 	 	Title: Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	CAMPUS CREST AT JONESBORO, LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Campus Crest Properties, LLC	 	 
	 	 	 	 	Its Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name: Michael S. Hartnett	 	 
	 

	 	 	 	 	 	Title: Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	CAMPUS CREST AT TROY, LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Campus Crest Properties, LLC	 	 
	 	 	 	 	Its Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name: Michael S. Hartnett	 	 
	 

	 	 	 	 	 	Title: Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	CAMPUS CREST AT MURFREESBORO, LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Campus Crest Properties, LLC	 	 
	 	 	 	 	Its Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name: Michael S. Hartnett	 	 
	 

	 	 	 	 	 	Title: Manager	 	 






 









 






	 	 	 	 	 	 	 	 	 

	 	 	CAMPUS CREST AT WICHITA, LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Campus Crest Properties, LLC	 	 
	 	 	 	 	Its Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name: Michael S. Hartnett	 	 
	 

	 	 	 	 	 	Title: Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	CAMPUS CREST STEPHENVILLE LESSOR, LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Campus Crest Properties, LLC	 	 
	 	 	 	 	Its Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name: Michael S. Hartnett	 	 
	 

	 	 	 	 	 	Title: Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	CAMPUS CREST WACO LESSOR, LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Campus Crest Properties, LLC	 	 
	 	 	 	 	Its Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name: Michael S. Hartnett	 	 
	 

	 	 	 	 	 	Title: Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	CAMPUS CREST WICHITA FALLS LESSOR, LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Campus Crest Properties, LLC	 	 
	 	 	 	 	Its Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name: Michael S. Hartnett	 	 
	 

	 	 	 	 	 	Title: Manager	 	 






 









 






	 	 	 	 	 	 	 	 	 

	 	 	CAMPUS CREST CHENEY LESSOR, LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Campus Crest Properties, LLC	 	 
	 	 	 	 	Its Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name: Michael S. Hartnett	 	 
	 

	 	 	 	 	 	Title: Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	CAMPUS CREST JONESBORO LESSOR, LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Campus Crest Properties, LLC	 	 
	 	 	 	 	Its Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name: Michael S. Hartnett	 	 
	 

	 	 	 	 	 	Title: Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	CAMPUS CREST TROY LESSOR, LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Campus Crest Properties, LLC	 	 
	 	 	 	 	Its Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name: Michael S. Hartnett	 	 
	 

	 	 	 	 	 	Title: Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	CAMPUS CREST MURFREESBORO LESSOR, LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Campus Crest Properties, LLC	 	 
	 	 	 	 	Its Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name: Michael S. Hartnett	 	 
	 

	 	 	 	 	 	Title: Manager	 	 






 









 






	 	 	 	 	 	 	 	 	 

	 	 	CAMPUS CREST WICHITA LESSOR, LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Campus Crest Properties, LLC	 	 
	 	 	 	 	Its Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name: Michael S. Hartnett	 	 
	 

	 	 	 	 	 	Title: Manager	 	 






 









 






	 	 	 	 	 
	 	SWING LINE BANK:



CITIBANK, N.A.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	INITIAL ISSUING BANK:



CITIBANK, N.A.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	ADMINISTRATIVE AGENT:



CITIBANK, N.A.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	COLLATERAL AGENT:



CITIBANK, N.A.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 



 









 






	 	 	 	 	 



	 	 	 	 	 
	 	INITIAL LENDERS:



BARCLAYS BANK PLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 



 









 






	 	 	 	 	 



	 	 	 	 	 
	 	CITIBANK, N.A.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 



 









 






	 	 	 	 	 



	 	 	 	 	 
	 	GOLDMAN SACHS BANK USA

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 



 









 






	 	 	 	 	 



	 	 	 	 	 
	 	RAYMOND JAMES BANK, FSB

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 



 









 






	 	 	 	 	 



	 	 	 	 	 
	 	ROYAL BANK OF CANADA

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title: