Exhibit
10.42




 





GMH Communities, LP,

as Issuer,


and


U.S. BANK TRUST NATIONAL ASSOCIATION,
 as Trustee


TRUST INDENTURE


GMH Communities, LP

Taxable Notes

Series 2007


Dated
as of May 7, 2007




 



















TABLE OF CONTENTS


	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE I

  	
  DEFINITIONS

  	
   

  	
  3

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II

  	
  THE NOTES

  	
   

  	
  17

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.01.

  	
  Authorized Amount of Notes

  	
   

  	
  17

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.02.

  	
  Issuance of Notes

  	
   

  	
  18

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.03.

  	
  Execution

  	
   

  	
  20

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.04.

  	
  Authentication

  	
   

  	
  21

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.05.

  	
  Form of Notes

  	
   

  	
  21

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.06.

  	
  Delivery of Notes

  	
   

  	
  21

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.07.

  	
  Mutilated, Lost, Stolen or Destroyed Notes

  	
   

  	
  22

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.08.

  	
  Registration and Exchange of Notes; Persons Treated
  as Owners

  	
   

  	
  22

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.09.

  	
  Cancellation of Notes

  	
   

  	
  24

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.10.

  	
  CUSIP Numbers

  	
   

  	
  24

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.11.

  	
  Book-Entry Notes

  	
   

  	
  24

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.12.

  	
  Notice to Note Depository

  	
   

  	
  26

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.13.

  	
  Definitive Notes

  	
   

  	
  26

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.14.

  	
  Undrawn Amount Fee

  	
   

  	
  26

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.15.

  	
  Additional Notes

  	
   

  	
  27

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III

  	
  OPTIONAL REDEMPTION OF NOTES BEFORE MATURITY

  	
   

  	
  27

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.01.

  	
  Optional Redemption of the Notes

  	
   

  	
  27

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.02.

  	
  Notice of Redemption

  	
   

  	
  28

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.03.

  	
  Redemption Payments

  	
   

  	
  28

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.04.

  	
  Cancellation

  	
   

  	
  29

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.05.

  	
  Partial Redemption of Notes

  	
   

  	
  29

  
						



 



 i
 









 


	
  

  	
  Section 3.06.

  	
  Effect of Redemption

  	
   

  	
  29

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV

  	
  REPRESENTATIONS AND WARRANTIES OF ISSUER

  	
   

  	
  29

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.01.

  	
  Organization and Good Standing

  	
   

  	
  29

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.02.

  	
  Due Qualification

  	
   

  	
  29

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.03.

  	
  Due Authorization

  	
   

  	
  29

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.04.

  	
  No Conflict

  	
   

  	
  30

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.05.

  	
  No Violation

  	
   

  	
  30

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.06.

  	
  No Proceedings

  	
   

  	
  30

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.07.

  	
  Binding Obligation

  	
   

  	
  30

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.08.

  	
  Accuracy in Reporting

  	
   

  	
  30

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.09.

  	
  Location of Issuer and Records

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.10.

  	
  Federal Tax Identification Number

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.11.

  	
  Taxes

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.12.

  	
  Solvency

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.13.

  	
  Transaction Documents

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.14.

  	
  Compliance with Law

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.15.

  	
  Perfection

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.16.

  	
  ERISA

  	
   

  	
  32

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.17.

  	
  Recordkeeping

  	
   

  	
  32

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V

  	
  AFFIRMATIVE COVENANTS

  	
   

  	
  32

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.01.

  	
  Payment of Principal and Interest, etc

  	
   

  	
  32

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.02.

  	
  Performance of Covenants by Issuer

  	
   

  	
  32

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.03.

  	
  Instruments of Further Assurance

  	
   

  	
  32

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.04.

  	
  Notice from Others

  	
   

  	
  33

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.05.

  	
  List of Noteholders

  	
   

  	
  33

  
						



 



 ii
 









 


	
  

  	
  Section 5.06.

  	
  Compliance with Laws, Etc

  	
   

  	
  33

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.07.

  	
  Audits

  	
   

  	
  34

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.08.

  	
  Location of Office

  	
   

  	
  34

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.09.

  	
  Preservation of Existence

  	
   

  	
  34

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.10.

  	
  Assignment of Rights under the Pledge Agreement

  	
   

  	
  34

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.11.

  	
  Keeping of Records and Books of Account

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.12.

  	
  Rights under Pledge Agreement

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.13.

  	
  Enforcement of Transaction Documents

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.14.

  	
  Security Interest

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.15.

  	
  No Pledge

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.16.

  	
  Guaranty Agreement

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.17.

  	
  Financial Covenants

  	
   

  	
  36

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.18.

  	
  Notice of Certain Events

  	
   

  	
  36

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.19.

  	
  Reporting Related to the Collateral

  	
   

  	
  36

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.20.

  	
  Litigation and Other Matters

  	
   

  	
  37

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.21.

  	
  Liens

  	
   

  	
  37

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.22.

  	
  Other Information

  	
   

  	
  37

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.23.

  	
  Foreign Assets

  	
   

  	
  37

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI

  	
  NEGATIVE COVENANTS

  	
   

  	
  37

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.01.

  	
  Sales, Liens, Etc. against Collateral

  	
   

  	
  37

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.02.

  	
  Extension or Amendment of Revenues

  	
   

  	
  38

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.03.

  	
  Merger, Consolidation, Etc

  	
   

  	
  38

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.04.

  	
  Transaction Documents

  	
   

  	
  38

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.05.

  	
  Change in Name, Jurisdiction of Organization

  	
   

  	
  38

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.06.

  	
  Actions under the Pledge Agreement

  	
   

  	
  38

  
						



 



 iii
 









 


	
  

  	
  Section 6.07.

  	
  ERISA

  	
   

  	
  39

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.08.

  	
  Affiliate Transactions

  	
   

  	
  39

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.09.

  	
  Transfers

  	
   

  	
  39

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.10.

  	
  Limitation on Distributions

  	
   

  	
  39

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.11.

  	
  Limitation on Indebtedness

  	
   

  	
  40

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.12.

  	
  REIT Status

  	
   

  	
  40

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII

  	
  REVENUES AND FUNDS

  	
   

  	
  41

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.01.

  	
  Source of Payment of Notes

  	
   

  	
  41

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.02.

  	
  Creation of Funds

  	
   

  	
  41

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.03.

  	
  The Revenue Fund

  	
   

  	
  41

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.04.

  	
  The Note Proceeds Fund

  	
   

  	
  42

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.05.

  	
  The Cost of Issuance Fund

  	
   

  	
  42

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.06.

  	
  Reserved

  	
   

  	
  42

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.07.

  	
  Reserved

  	
   

  	
  42

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.08.

  	
  Monthly Statements

  	
   

  	
  42

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.09.

  	
  Nonpresentment of Notes

  	
   

  	
  43

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.10.

  	
  Money to be Held in Trust

  	
   

  	
  44

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.11.

  	
  Amounts Remaining in Funds

  	
   

  	
  44

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  	
  INVESTMENT OF MONEY

  	
   

  	
  44

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IX

  	
  DISCHARGE OF INDENTURE; DEFEASANCE OF NOTES

  	
   

  	
  45

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE X

  	
  EVENT OF DEFAULT PROVISIONS AND REMEDIES

  	
   

  	
  47

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.01.

  	
  Events of Default

  	
   

  	
  47

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.02.

  	
  Remedies; Rights of Noteholders

  	
   

  	
  49

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.03.

  	
  Right of Noteholders to Direct Proceedings

  	
   

  	
  49

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.04.

  	
  Application of Money

  	
   

  	
  49

  
						



 



 iv
 









 


	
  

  	
  Section 10.05.

  	
  Remedies Vested in the Trustee

  	
   

  	
  51

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.06.

  	
  Rights and Remedies of Noteholders

  	
   

  	
  51

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.07.

  	
  Termination of Proceedings

  	
   

  	
  52

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.08.

  	
  Waivers of Events of Default

  	
   

  	
  52

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.09.

  	
  Notice of Defaults

  	
   

  	
  52

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XI

  	
  DELIVERY OF COLLATERAL

  	
   

  	
  53

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 11.01.

  	
  Continuing Liability of the Issuer

  	
   

  	
  53

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 11.02.

  	
  UCC Matters

  	
   

  	
  53

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 11.03.

  	
  Delivery of Collateral

  	
   

  	
  54

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 11.04.

  	
  Delivery of Additional Collateral

  	
   

  	
  55

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XII

  	
  TRUSTEE

  	
   

  	
  55

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 12.01.

  	
  Acceptance of the Trusts

  	
   

  	
  55

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 12.02.

  	
  Fees, Charges and Expenses of the Trustee and Paying
  Agents; Other Fees and Expenses

  	
   

  	
  59

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 12.03.

  	
  Notice to Noteholders if Default Occurs

  	
   

  	
  59

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 12.04.

  	
  Intervention by Trustee

  	
   

  	
  59

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 12.05.

  	
  Successor Trustee

  	
   

  	
  59

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 12.06.

  	
  Resignation by Trustee

  	
   

  	
  59

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 12.07.

  	
  Removal of Trustee

  	
   

  	
  60

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 12.08.

  	
  Appointment of Successor Trustee by the Noteholders;
  Temporary Trustee

  	
   

  	
  60

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 12.09.

  	
  Concerning any Successor Trustee

  	
   

  	
  60

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 12.10.

  	
  Designation and Succession of Paying Agent

  	
   

  	
  61

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 12.11.

  	
  Appointment of Co-Trustee

  	
   

  	
  61

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 12.12.

  	
  Trustee Not Liable for Failure of Others to Act

  	
   

  	
  62

  
						



 



 v
 









 


	
  ARTICLE XIII

  	
  NOTE DEPOSITORY

  	
   

  	
  62

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 13.01.

  	
  Qualifications of a Note Depository, a Successor
  Note Depository or Substitute Depository

  	
   

  	
  62

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 13.02.

  	
  Resignation of Note Depository

  	
   

  	
  63

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 13.03.

  	
  Removal of Note Depository by the Trustee

  	
   

  	
  63

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 13.04.

  	
  Removal of Note Depository by the Issuer and the
  Registrar

  	
   

  	
  63

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 13.05.

  	
  Effective Date of Resignation or Removal of Note
  Depository

  	
   

  	
  63

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 13.06.

  	
  Appointment of Substitute Depository

  	
   

  	
  63

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 13.07.

  	
  Successor Note Depository

  	
   

  	
  63

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 13.08.

  	
  Purpose of Transfer or Exchange of Global
  Certificates

  	
   

  	
  63

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 13.09.

  	
  Mechanics of Transfer of the Global Certificates

  	
   

  	
  64

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 13.10.

  	
  Mechanics of Exchange of the Global Certificate for
  Another Global Certificate

  	
   

  	
  64

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 13.11.

  	
  Exchange of the Global Certificate for Replacement
  Notes

  	
   

  	
  64

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 13.12.

  	
  Procedures to Convert Replacement Notes

  	
   

  	
  64

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 13.13.

  	
  Exchange of the Global Certificate for Replacement
  Notes

  	
   

  	
  64

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 13.14.

  	
  Liability of Note Depository

  	
   

  	
  64

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XIV

  	
  SUPPLEMENTAL INDENTURES

  	
   

  	
  64

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 14.01.

  	
  Supplemental Indentures not Requiring Consent of
  Noteholders

  	
   

  	
  64

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 14.02.

  	
  Supplemental Indentures Requiring Consent of
  Noteholders

  	
   

  	
  65

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 14.03.

  	
  Discretion of Issuer and Trustee to Execute
  Supplemental Trust Indenture

  	
   

  	
  66

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XV

  	
  MISCELLANEOUS

  	
   

  	
  66

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 15.01.

  	
  Consents, etc., of Noteholders

  	
   

  	
  66

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 15.02.

  	
  Third Party Beneficiaries; Limitation of Rights

  	
   

  	
  67

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 15.03.

  	
  Severability

  	
   

  	
  67

  
	
   

  	
   

  	
   

  	
   

  	
   

  
						



 



 vi
 









 


	
  

  	
  Section 15.04.

  	
  Notices

  	
   

  	
  67

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 15.05.

  	
  Payments Due on Saturdays, Sundays and Holidays

  	
   

  	
  67

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 15.06.

  	
  Counterparts

  	
   

  	
  68

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 15.07.

  	
  Applicable Provisions of Law; Waiver of Jury Trial;
  Forum Selection

  	
   

  	
  68

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 15.08.

  	
  Captions or Headings in this Indenture

  	
   

  	
  68

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 15.09.

  	
  Force Majeure

  	
   

  	
  68

  



 


EXHIBITS AND SCHEDULES


Exhibit A - Form of
Series 2007 Taxable Note


Exhibit B - Closing Statement


Exhibit C - Military Housing Projects


Exhibit D - Form of Notice to Make a Drawing


Exhibit E - Schedule of Drawings and Redemptions


Exhibit F - Audited Financial Statements


Exhibit G - Pledged Accounts


Exhibit H - Closing Proforma


Schedule 4.06


Schedule 5.02



 vii















TRUST INDENTURE


THIS
TRUST INDENTURE is made and entered into as of May 7, 2007
by and between GMH COMMUNITIES, LP, a Delaware limited partnership, as
issuer (the “Issuer”), and U.S. BANK TRUST NATIONAL
ASSOCIATION, a national banking association organized and existing under the
laws of the United States of America, as trustee (together with any successor
trustee hereunder, the “Trustee”).


W I T N E S S E T H :


WHEREAS, GMH Communities
Trust (“GMH”) is a publicly-traded real estate investment trust (“REIT”) that
focuses on providing housing to college and university students and to U.S.
military personnel and their families;


WHEREAS, the Issuer is
the operating partnership of GMH, and is a Delaware limited partnership with
the authority, among other things, to borrow money and issue the Notes in order
to raise working capital.  Through the
Issuer, GMH owns and operates various student housing properties, and owns
equity interests in various ventures that own military housing privatization
projects, pursuant to the Military Housing Privatization Initiative in the 1996
National Defense Authorization Act, as amended;


WHEREAS, the Issuer
provides, through its taxable REIT subsidiaries and other affiliates, for
operation, development, construction, renovation, and management services for
the military housing privatization projects, and for property management
services for student housing properties;


WHEREAS, with respect to
the military housing privatization projects, the Issuer has an ownership
interest in, and through various subsidiaries and affiliates operates,
develops, constructs, renovates, and manages, ten (10) military housing
privatization projects comprising an aggregate of approximately 19,631 housing
units as of the date hereof and 20,364 end-state housing units, and is in
exclusive negotiations with the U.S. Navy and the U.S. Army with respect to two
(2) additional military housing privatization projects;


WHEREAS, GMH’s military
housing privatization projects are conducted through two wholly-owned subsidiaries
of the Issuer, GMH Military Housing Investments, LLC and GMH Military Housing,
LLC.  GMH Military Housing Investments,
LLC owns equity interests in the military housing privatization projects, and
owns and operates the AETC Group 1 military housing privatization project.  GMH Military Housing, LLC develops, manages,
and constructs/renovates military housing and related infrastructure at all
other GMH military housing privatization projects through its subsidiaries;


WHEREAS, pursuant to
contractual agreements within the GMH organizational structure, the Issuer
regularly receives distributions in the form of revenues derived from various
fees (including, without limitation, operating, management, development,
construction/renovation, and incentive fees), and returns on equity
contributions from its subsidiaries involved in the military housing
privatization projects, including, without limitation, from GMH Military
Housing Investments, LLC, GMH Military Housing, LLC, and their subsidiaries;



 1
 









WHEREAS, the Issuer
wishes to issue the Notes in an aggregate principal amount of up to
$100,000,000, as may be expanded, all as hereinafter provided, to access
additional working capital in order to, among other things, retire and
terminate its Existing Line of Credit (as defined herein), which was used for
the financing of acquisitions, the payment of dividend distributions, for
working capital, and other general corporate purposes;


WHEREAS, the Initial
Owner agrees to purchase the Notes pursuant to that certain Note Purchase
Agreement, by and between the Issuer and the Initial Owner, and dated as of the
date hereof;


WHEREAS, the Trustee has
been granted a security interest in the Collateral (as defined herein, and
which includes the aforementioned distributions, fees, and returns on equity
contributions), pursuant to this Indenture and that certain Pledge and Security
Agreement by and among the Trustee, GMH, and the Guarantors, dated as of the
date hereof;


WHEREAS, pursuant to the
Pledge Agreement and that certain Account Control Agreement, dated May 7, 2007,
the parties thereto have granted a security interest to the Trustee in certain
accounts as set forth on Exhibit G.


WHEREAS, all things
necessary to (i) make the Notes, when authenticated by the Trustee and issued as
provided in this Indenture, the valid, binding and legal general obligations of
the Issuer and to constitute this Indenture as a valid assignment and pledge of
the Collateral in order to secure the prompt and complete payment when due of
the Obligations of the Issuer, including, but not limited to, the payment of
principal of and interest on the Notes, and the performance by the Issuer of
all of its covenants and obligations herein, (ii) the creation, execution and
delivery of this Indenture, and (iii) the creation, execution and issuance of
the Notes, subject to the terms hereof, have in all respects been duly
authorized; and,


WHEREAS GMH and the
Guarantors, pursuant that certain Guaranty Agreement by and among the Trustee,
GMH, and the Guarantors, dated as of the date hereof, have agreed to guaranty
the prompt and complete performance and payment when due of all present and
future Obligations of the Issuer under this Indenture;


NOW, THEREFORE, THIS TRUST
INDENTURE WITNESSETH:


GRANTING CLAUSE


The Issuer, in
consideration of the premises and the acceptance by the Trustee of the trusts
hereby created and of the purchase and acceptance of the Notes by the Initial
Owner thereof, and for other good and valuable consideration, the receipt of
which is hereby acknowledged, in order to secure the prompt and complete
performance and payment when due of the Obligations, including, but not limited
to, the payment of principal of and interest on the Notes, and the performance
by the Issuer of all of the covenants and obligations to be performed by it
pursuant to this Indenture, the Issuer hereby irrevocably assigns and pledges
to the Trustee and grants to the Trustee a security interest, on behalf of the
Secured Parties, in all of the Issuer’s right, title and interest in, to and
under, the following (which is collectively, the “Collateral”):



 2
 









(a)           the Revenues;


(b)           the Preferred Returns;


(c)           GMH’s and the
Guarantors’ guaranty pursuant to the Guaranty Agreement;


(d)           all Additional
Collateral;


(e)           all Pledged Collateral,
as defined in the Pledge Agreement;


(f)            all monies, cash, and
securities held from time to time under and subject to the terms of this
Indenture, the Pledge Agreement, or the Account Control and Security Agreement,
except monies, cash, and securities in the Cost of Issuance Fund;


(g)           all certificates,
instruments, agreements, including, but not limited to, the Transaction
Documents, representing or evidencing, or the monies or property resulting
therefrom, any of the foregoing property described in clauses (a) through (f)
above; and


(h)           all proceeds of the
foregoing property described in clauses (a) through (g), inclusive, above,
including interest, dividends, cash, instruments and other property from time
to time received, receivable or otherwise distributed in respect of or in
exchange for or on account of the sale or other disposition of any or all of
the then existing collateral.


IN TRUST NEVERTHELESS,
upon the terms and trusts herein set forth for the benefit, security and
protection of the Secured Parties with the privileges, priorities and
distinctions as to the lien and otherwise herein set forth.


ARTICLE I


DEFINITIONS


In addition to words and terms defined in the
recitals, the following words and phrases shall have the following meanings as
used in this Indenture:


“Account Control and Security Agreement”
means that certain Account Control and Security Agreement dated May 7, 2007 by
and among the Trustee, the Initial Owner (acting as Collateral Agent) and the
Pledgors (as defined therein).


“Additional Collateral”
means any additional collateral, in form and substance acceptable to the
Initial Owner, in the exercise of its sole and absolute discretion, delivered
by the Issuer to the Trustee pursuant to Section or 11.04 of this Indenture.


“Additional Notes” means
any Notes issued by the Issuer in accordance with Section 2.15 of this
Indenture.


“Adjusted
Management EBITDA” shall mean the EBITDA received from GMH for the
three (3)-month period ending on the last day of a fiscal quarter ending on the
date of determination, all as calculated in accordance with GAAP.



 3
 









“Affiliate” means,
with respect to any specified Person, any other Person controlling or
controlled by or under common control with such specified Person.  For the purposes of this definition, “control”
when used with respect to any Person means the power to direct the management
and policies of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise, and the terms “controlling”
and “controlled” have meanings correlative to the foregoing.


“Aggregate Outstanding Principal Amount” means, as of any date of
determination and with respect to the Notes, the aggregate outstanding
principal amount of the Notes.


“Authorized Denominations” means U.S. $100,000 and any integral multiples of U.S. $5000
in excess thereof.


“Authorized Officer”
means an officer of the general partner of the Issuer or any other
person authorized or persons designated by the Issuer to act on its behalf as
an “Authorized Officer” under this Indenture.


“Bankruptcy Code” means
Title 11 of the United States Code (11 U.S.C. Section 101 et seq.), as amended
from time to time, or any successor statute.


“Bankruptcy Proceeding”
means, with respect to any Person, such Person shall make a general
assignment for the benefit of creditors; or any proceeding shall be instituted
by such Person 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 the Bankruptcy Code or 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, custodian or other similar official for it or for any substantial part
of its property; or any proceeding shall be instituted against such Person
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 the Bankruptcy Code or 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,
custodian or other similar official for it or for any substantial part of its
property, or seeking the entry of an order for relief against, or the
appointment of a receiver, trustee, custodian or other similar official for it
or for any substantial part of its property, or any proceeding for the
appointment of a receiver, liquidator, assignee, trustee, custodian,
sequestrator or similar Person, or for the winding up or liquidation of the
affairs of such Person.


“Beneficial Owner(s)” means when the
Notes are held by a Note Depository, the owner of any Notes which are held for
such owner by a Note Depository in the form of a Global Certificate.


“Benefit Plan” means
a defined benefit plan as defined in Section 3(35) of ERISA (other than a
Multiemployer Plan) in respect of which the Issuer or any ERISA Affiliate is,
or at any time within the immediately preceding six years was, an “employer” as
defined in Section 3(5) of ERISA.



 4
 









“Book-Entry Notes” means the
beneficial interests in Notes designated as “Book-Entry Notes”
in this Indenture, ownership and transfers of which shall be evidenced or made
through book entries by a Note Depository as described in Section 2.11;
provided, that after the occurrence of a condition whereupon Definitive Notes
are to be issued to Owners, such Book-Entry Notes shall no longer be “Book-Entry
Notes.”


“Business Day” means
a day when (i) banks in the State of New York are open, (ii) the New York Stock
Exchange is open for trading and settlements, (iii) the U.S. treasury bond market is open for trading and settlements, (iv) the Trustee is open and (v) Merrill Lynch & Co. is open.


“Certificated Securities” has the meaning
set forth in Section 8-102(4) of the UCC.


“Closing
Proforma”
means that certain proforma set forth in Exhibit H.


“Closing
Statement”
means that statement set forth as Exhibit B.


“Collateral” shall have the meaning assigned to such term
in the Granting Clause of this Indenture.


“Commitment Fee” means (i) with respect to the Initial Notes,
an amount equal to $1,000,000, which is payable by the Issuer to the Initial
Owner on the Effective Date pursuant to the terms of the Fee Letter, and (ii)
with respect to each issuance of Additional Notes by the Issuer pursuant to the
terms of this Indenture, an amount equal to $250,000 payable by the Issuer to
the Initial Owner no later than the date of issuance of the Issuer’s first
Drawing of Additional Notes.


“Consolidated Interest Charges”
shall mean, for any Person for any period, the sum of (a) all interest, premium
payments, debt discount, fees, charges and related expenses of such Person in
connection with borrowed money (including capitalized interest) or in
connection with the deferred purchase price of assets, in each case to the
extent treated as interest in accordance with GAAP, and (b) the portion of rent
expense of such Person with respect to such period under capital leases that is
treated as interest in accordance with GAAP.


“Consolidated Tangible Net Worth”
shall mean, as of any date of determination for the Issuer and its Subsidiaries
on a consolidated basis (except that the minority equity interests in Issuer
shall be included for purposes of this calculation), (a) shareholders’
equity of Issuer and its Subsidiaries on that date minus
(b) the Intangible Assets of Issuer and its Subsidiaries on that date; plus (c) all accumulated depreciation and amortization
determined in accordance with GAAP of the Issuer and its Subsidiaries on that
date.


“Controlling Party” means,
as of any date of determination, until the payment in full by the Issuer of all
amounts due and owing the Initial Owner under this Indenture and the Fee
Letter, the Initial Owner and thereafter, the Majority Owners.


“Cost of Issuance Fund”
means the fund by that name created pursuant to Section 7.05 of this
Indenture.



 5
 









“Defeasance Obligations”
means Government Obligations which are not subject to redemption prior
to maturity.


“Definitive
Notes” has the meaning set
forth in Section 2.13.


“Delivery” when
used with respect to Collateral means:


(a)           with respect to bankers’
acceptances, commercial paper, negotiable certificates of deposit and other
obligations that constitute instruments and are susceptible of physical
delivery (“Physical Property”) transfer of possession thereof to the Trustee,
endorsed to, or registered in the name of, the Trustee or its nominee or
endorsed in blank;


(b)           with respect to a
certificated security:


(i)            delivery thereof in
bearer form to the Trustee so that the Trustee acquires possession thereof;


(ii)           if another Person,
other than a securities intermediary, has acquired possession of a certificated
security, such Person (A) has acquired possession of the certificated security
on behalf of the Trustee or (B) having previously acquired possession of the
certificated security acknowledges that it holds the certificate for the
Trustee; or


(iii)          delivery of a
certificated security in registered form to the Securities Intermediary so that
Securities Intermediary acquires possession, which shall occur if the
certificated security is (A) registered in the name of the Trustee, (B) payable
to the order of the Trustee or (C) specially indorsed to the Trustee by
effective endorsement and has not been indorsed to the Securities Intermediary
or in blank;


(c)           with respect to an
uncertificated security:


(i)            the issuer has registered
the Trustee as the registered owner upon original issue or registration of
transfer; or


(ii)           if another Person,
other than the Securities Intermediary (as defined in the UCC), becomes the
registered owner of the uncertificated security, such Person (A) becomes the
registered owner of the uncertificated security on behalf of the Trustee or (B)
having previously become the registered owner of the uncertificated security
acknowledges that it holds the uncertificated security for the Trustee;


(d)           with respect to any
security issued by the U.S. Treasury that is a book-entry security held through
the Federal Reserve System pursuant to Federal book-entry regulations:


(i)            a Federal Reserve Bank
by book entry credits the book-entry security to the securities account (as
defined in 31 C.F.R. Part 357) of a 



 6
 









participant (as defined in 31 C.F.R. Part 357) which
is also a Securities Intermediary; and


(ii)           the participant
indicates by book entry that the book-entry security has been credited to the
Trustee’s securities account;


(e)           with respect to a
security entitlement:


(i)            the Trustee becomes
the entitlement holder; or


(ii)           the Securities
Intermediary has agreed that it will comply with entitlement orders originated
by the Trustee without further consent by the entitlement holder;


(f)            in each case of
Delivery contemplated herein, the Trustee shall make appropriate notations on
its records, and shall cause the same to be made on the records of its
nominees, indicating that securities are held in trust pursuant to and as
provided in this Indenture.


“Drawing” means each issuance of Notes by the Issuer
pursuant to this Indenture.


“DTC”,
“Depository”, “Note
Depository”, or “Securities Depository”
means The Depository Trust Company of
New York, New York and/or its nominee Cede & Co. or any successors,
Substitute Depositories or assigns thereof which meet the qualifications set
forth in Article XIII, and in whose name or names the Global Certificate shall
be registered in the book of the Registrar or its successors and assigns.


“EBITDA”
means for any period, for any Person, an amount equal to the net income for
such period plus (a) the following to the extent deducted in calculating such
net income:  (i) Consolidated Interest
Charges for such period; (ii) the provision for federal, state, local and
foreign income taxes payable by such Person for such period; (iii) depreciation
and amortization expense for such period; and (iv) other non-recurring expenses
of the Person reducing such net income which do not represent a cash item in
such period or any future period minus (b) the following to the extent included
in calculating such net income:  (i)
federal, state, local and foreign income tax credits of the Person for such
period; and (ii) all non-cash items increasing net income for such period.


“Effective Date” means
May 7, 2007, or such other date that is mutually agreed upon by the Issuer and
the Initial Owner.


“Entitlement Order” shall
have the meaning given such term in Section 8-102(a) (8) of the UCC.


“ERISA” means
the U.S. Employee Retirement Income Security Act of 1974, as amended from time
to time, and any successor statute.


“ERISA Affiliate” means
any (i) corporation which is a member of the same controlled group of
corporations (within the meaning of Section 414(b) of the IRC) as the Issuer,
(ii) 



 7
 









partnership or
other trade or business (whether or not incorporated) under common control
(within the meaning of Section 414(c) of the IRC) with the Issuer or (iii)
member of the same affiliated service group (within the meaning of Section
414(m) of the IRC) as the Issuer, any corporation described in clause (i) above
or any partnership or other trade or business described in clause (ii) above.


“Event of Default” means
any of the events specified in Section 10.01 of this Indenture.


“Existing Line of Credit” means that
certain Loan Agreement entered into between Issuer and Wachovia Bank, National
Association, dated October 2, 2006.


“Fee Letter” means
the letter agreement of even date herewith between the Issuer and the Initial
Owner, as amended, restated, supplemented or otherwise modified from time to
time.


“Fitch” means
Fitch Ratings or its successor in interest.


“Fixed Charges Coverage Ratio” shall mean
the ratio of (1) Net Operating Income, to (2) the Consolidated Interest Charges
(excluding unamortized upfront fees), principal amortization, and preferred
dividends of GMH and any of its Affiliates or Subsidiary entities, all as
calculated over the same time period by Issuer and approved by Trustee.


“Fund or Funds” means
(i) in the singular form, any of the Revenue Fund, the Note Proceeds Fund, or
the Cost of Issuance Fund created and established by the Issuer pursuant to
Section 7.02 of this Indenture and (ii) in the plural form, the Revenue Fund,
the Note Proceeds Fund, and the Costs of Issuance Fund.


“GAAP” means
generally accepted accounting principles in the United States of America in
effect from time to time.


“Global Certificate” means, when the
Notes are held by a Note Depository, the Notes in the form of one (1) Global
Certificate representing the aggregate principal amount of the Notes due on the
Maturity Date, which shall be registered in the name of such Note Depository,
substantially in the form attached hereto as Exhibit A.


“GMH” means GMH Communities Trust, a
publicly-traded, Maryland REIT.


“Governmental Authority”
means the federal, state, local or other political subdivision thereof
and any entity exercising executive, judicial, regulatory, or administrative
functions of or pertaining to government.


“Governmental Obligations” means the following:


(a)           bonds, notes,
certificates of indebtedness, treasury bills or other securities constituting
direct obligations of, or obligations the principal of and interest on which
are fully and unconditionally guaranteed by, the United States of America; and


(b)           evidences of direct
ownership of a proportionate or individual interest in future interest or
principal payments on specified direct obligations of, or obligations the 



 8
 









payment of the principal of and interest on which are
unconditionally guaranteed by, the United States of American, which obligations
are held by a bank or trust company organized and existing under the laws of
the United States of America or any state thereof in the capacity of custodian
in form and substance satisfactory to the Trustee.


“Guarantor(s)” means,
excluding GMH and the Trustee, all of the parties to the Guaranty Agreement.


“Guaranty Agreement”
means the Guaranty Agreement dated as of May 7, 2007, by and among GMH,
the Gurantors, and the Trustee.


“Indenture” means
this Trust Indenture between the Issuer and the Trustee, and all amendments or
supplements hereto.


“Independent Counsel”
means an attorney duly admitted to practice law before the highest court
of any state or the District of Columbia and who is not a full-time employee,
director or holder of a partnership interest of the Issuer.


“Initial Notes” means the Series 2007 Notes
in the aggregate principal amount of up to $100,000,000, issued by the Issuer
pursuant to the terms of this Indenture.


“Initial Owner” means
Merrill Lynch, Pierce, Fenner & Smith Incorporated, or any Affiliate or
Subsidiary thereof, together with its successors and assigns.


“Initial Summary of Revenues” means the Summary of Revenues of the Issuer delivered by the
Issuer to the Initial Owner and the Trustee on the Effective Date, as specified
in Section 5(d)(ii) of the Note Purchase Agreement.


“Intangible Assets” shall mean
assets that are considered to be intangible assets under GAAP, including
customer lists, goodwill, computer software, copyrights, trade names,
trademarks, patents, franchises, licenses, unamortized deferred charges,
unamortized debt discount and capitalized research and development costs.


“Interest Accrual Period” means, with respect to the Notes, initially, the period
commencing on the Effective Date and ending on May 31, 2007, and thereafter,
means the period commencing on the first calendar day of each month and ending
on the last calendar day of such month, with interest accruing on the basis of
the actual number of days elapsed in the related Interest Accrual Period and a
year of 360 days.


“Interest Distribution Amount” means, with respect to the Notes and any Interest Payment
Date, the interest accrued during the related Interest Accrual Period on the Aggregate
Outstanding Principal Amount of the Notes, without taking into account any
distributions of principal on the Notes on such Interest Payment Date, at the
Note Rate.


“Interest Payment Date”
means the first calendar day of each calendar month, commencing June 1,
2007, and ending on the Maturity Date, which if such first calendar day is not
a Business Day, shall be the next Business Day.



 9
 









“Investment Obligations”
means any of the following which at the time of investment are legal
investments under the laws of the State for monies held hereunder:  (a) Governmental Obligations or mutual funds
rated “Aaa” by Moody’s, “AAA” by
S&P and “AAA” by Fitch and fully secured by Governmental Obligations; (b)
Notes, debentures, notes or other evidences of indebtedness issued or
guaranteed by any of the following federal agencies:  Federal Home Loan Mortgage Corporation
(senior debentures only), GNMA, FNMA, Federal Home Loan Banks; (c) if approved,
in writing, by the Initial Owner, master repurchase agreements with entities
whose short term unsecured debt is rated “P-1” by Moody’s, “A-1+” by
S&P and “F-1+” by Fitch; (d) the following investments, so long as such
investments are fully insured by the Federal Deposit Insurance
Corporation:  certificates of deposit,
savings accounts, deposit accounts or depository receipts having original
maturities of not more than 365 days (or 366 days, if applicable) of federally
or state chartered banks or trust companies (including the Trustee or
Affiliates thereof), savings and loan associations and mutual savings banks
with capital surplus and undivided profits of not less than $100,000,000,
provided the unsecured obligations of any such institution are rated “P-1” by
Moody’s, “A-1”
short term or better by S&P and “F-1+” by Fitch; (e) units of a
money market fund which at the time of investment is rated “Aaa” by Moody’s, “AAA” by S&P and “AAA” by Fitch, including funds for
which the Trustee and its Affiliates provide investment advisory or other
management services; and (f) any other investment approved, in writing, by the
Issuer and the Initial Owner.


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


“Irrevocable Payment Instructions”
means the payment instructions executed by the Guarantors in substantially
similar form to Exhibit A-1 of the Pledge Agreement.


“Issuer” means
GMH
Communities, LP, a Delaware limited partnership.


“LIBOR Determination Date” means May 2, 2007, and with respect to any subsequent Interest
Accrual Period, the second London Business Day preceding the commencement of
such Interest Accrual Period (or in the case of the first Interest Accrual
Period, the second London Business Day preceding the Effective Date.


“Lien” means
any mortgage, deed of trust, pledge, hypothecation, assignment, conditional
sale agreement, deposit arrangement, security interest, encumbrance, lien
(statutory or otherwise), preference, priority or other security agreement or
preferential arrangement of any kind or nature whatsoever, in respect of any
property of a Person, whether granted voluntarily or imposed by law, and
includes the interest of a lessor under a capital lease or under any financing
lease having substantially the same economic effect as any of the foregoing and
the filing of any financing statement or similar notice (other than a financing
statement filed by a “true” lessor or consignor pursuant to Section 9-505 of
the UCC), naming the owner of such property as debtor, under the UCC or other
comparable law of any jurisdiction.


“London Business Day”
means any day on which dealings in deposits of United States dollars are
transacted in the London interbank market.


“Majority Owners” means,
collectively, the Owners of a majority in principal amount of the Notes
Outstanding as of any date of determination.



 10
 









“Material Adverse Change” means, as of any date of determination, (a) a material adverse
change with respect to (i) when used with reference to a particular Person, the
condition (financial or otherwise), business, operations, properties or
revenues of such Person, or the ability of such Person to perform any of its
obligations under this Indenture or any other Transaction Document, (ii) the
legality, validity, binding effect or enforceability of any of the material
Transaction Documents, (iii) the rights or interests of the Initial Owner under
the Transaction Documents, (iv) the Trustee’s ability to enforce any of the
obligations of the Issuer under this Indenture or any other Transaction
Document, or any of their respective rights in the Transaction Documents, and,
(b) the material decrease, or loss or adverse effect in, of, or on Collateral.


“Maturity Date means
April 30, 2010.


“Military Housing Project(s)” means
the military housing privatization projects at the military installations
listed in Exhibit C, which are owned, operated, developed, constructed,
renovated, or managed, by the Issuer, the Guarantors, and their Affiliates and
Subsidiaries, and any military housing privatization project which the Issuer,
GMH, the Guarantors, or their Affiliates and Subsidiaries acquires or
consummates any agreement to own, operate, develop, construct, renovate, or
manage in connection with the military installations listed in Exhibit C.


“Monthly Period” means,
with respect to each Interest Payment Date, the calendar month immediately preceding
the calendar month in which the Interest Payment Date occurs.


“Monthly Statement” means
any of the monthly statements prepared by the Trustee and delivered to the
Issuer, the Initial Owner and the other owners of the Notes on each Interest
Payment Date as specified in Section 7.08 of this Indenture.


“Moody’s” means
Moody’s Investors Service, Inc. or its successor in interest.


“Multiemployer Plan”
means a “multiemployer plan” as defined in Section 4001(a)(3) of ERISA
or Section 414(f) of the IRC which is, or within the immediately preceding six
years was, contributed to by either the Issuer or any ERISA Affiliate.


“1933 Act” means
the Securities Act of 1933, as amended.


“Net Operating Income” shall mean with respect to any
specified period, revenues, minus (A) operating expenses and (B) replacement
reserves of $125 per bed for the student housing business, all as calculated by
Issuer and reasonably approved by Trustee.


“Noteholder” or
“Noteowner” or “Owner of Notes” or “Owner” or “Initial Owner” “owner” or “holder” means, with respect to a Book-Entry
Note, the Person that is the beneficial owner of such Book-Entry Note, as
reflected on the books of the Note Depository or on the books of a Person
maintaining an account with such Note Depository (directly as a Participant or
an indirect participant, in each case in accordance with the rules of such Note
Depository), and with respect to a Definitive Note, the Person that is the
registered owner of such Note as reflected in the Note Register.



 11
 









“Note Proceeds Fund” means that Fund
established under Section 7.02 and described in Section 7.04.


“Note Purchase Agreement” means the Note Purchase Agreement dated May 7, 2007 between
the Issuer and the Initial Owner, as purchaser of the Notes, as the same may be
supplemented or amended from time to time.


“Note Rate” means
One-Month LIBOR plus 175 basis points per annum (1.75%), as calculated on the
applicable LIBOR Determination Date.


“Note Register” means a register in
which the Issuer provides for the registration of Notes and the registration of
the transfer of Notes.


“Notes” or “Series 2007 Notes” means
the Initial Notes and any Additional Notes issued by the Issuer pursuant to the
terms of this Indenture in substantially the form of Exhibit A attached hereto.


“Notice Address” means:


	
   

  	
  (a)

  	
  As to the Issuer:

  	
  Joseph Macchione

  
	
   

  	
   

  	
   

  	
  GMH Communities,
  LP

  
	
   

  	
   

  	
   

  	
  10 Campus Blvd

  
	
   

  	
   

  	
   

  	
  Newtown Square,
  PA 19073

  
	
   

  	
   

  	
   

  	
  Telephone: (610)
  355-8180

  
	
   

  	
   

  	
   

  	
  Fax: (610)
  355-8480

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  With a copy to:

  	
  G. Scott Rafshoon

  
	
   

  	
   

  	
   

  	
  McKenna Long
  & Aldridge LLP

  
	
   

  	
   

  	
   

  	
  303 Peachtree
  Street, Suite 5300

  
	
   

  	
   

  	
   

  	
  Atlanta, GA
  30308

  
	
   

  	
   

  	
   

  	
  Telephone.:
  (404) 527-4952

  
	
   

  	
   

  	
   

  	
  Fax.: (404)
  527-4198

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  As to the Trustee:

  	
  U.S. Bank Trust National Association

  
	
   

  	
   

  	
   

  	
  100 Wall Street,
  Suite 1600

  
	
   

  	
   

  	
   

  	
  New York, New
  York 10005

  
	
   

  	
   

  	
   

  	
  Attention:
  Corporate Trust Administration

  
	
   

  	
   

  	
   

  	
  Telephone: (212)
  361-6184

  
	
   

  	
   

  	
   

  	
  Fax: (212)
  809-5459

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (c)

  	
  As to the Initial Owner:

  	
  Kacie Carl

  
	
   

  	
   

  	
   

  	
  Merrill Lynch,
  Pierce, Fenner & Smith
  

  Incorporated

  
	
   

  	
   

  	
   

  	
  World Financial
  Center

  
	
   

  	
   

  	
   

  	
  North Tower, 9th
  Floor

  
	
   

  	
   

  	
   

  	
  250 Vesey Street

  
	
   

  	
   

  	
   

  	
  New York, NY
  10281

  
	
   

  	
   

  	
   

  	
  Facsimile: (212)
  669-0791

  



 



 12
 









 


	
  

  	
   

  	
  With a copy to:

  	
  David Notkin

  
	
   

  	
   

  	
   

  	
  Merill Lynch,
  Pierce, Fenner & Smith
  

  Incorporated

  
	
   

  	
   

  	
   

  	
  World Financial
  Center

  
	
   

  	
   

  	
   

  	
  North Tower, 9th Floor

  
	
   

  	
   

  	
   

  	
  250 Vesey Street

  
	
   

  	
   

  	
   

  	
  New York, NY
  10281

  
	
   

  	
   

  	
   

  	
  Facsimile: (212)
  449-7174

  



 


“Obligations” means
all present and future indebtedness and other liabilities and obligations
(howsoever created, arising or evidenced, whether direct or indirect, absolute
or contingent, or due or to become due) of the Issuer to the Secured Parties,
arising under or in connection with this Indenture and the other Transaction
Documents or the transactions contemplated hereby and thereby, and shall
include, without limitation, the payment of principal of and interest on the
Notes according to their tenor and effect, fees and other obligations that
accrue after the commencement of a Bankruptcy Proceeding (in each case whether
or not allowed as a claim in such Bankruptcy Proceeding).


“Official LIBOR Page”
means the Telerate British Bankers’ Association LIBOR Rates Page, which
is the display designated as Page 3750 on the Telerate, Inc. news and
information service, or such other page as may replace Official LIBOR Page on
such service for the purpose of displaying London interbank offered rates of
major banks.


“One-Month LIBOR” means,
with respect to the first Interest Accrual Period and any Interest Accrual
Period thereafter, the per annum rate (rounded, if necessary, to the nearest
one-hundredth of one percent) for deposits in U.S. dollars for one month that
appears on the Official LIBOR Page as of 11:00 a.m. (London, England time) on
the LIBOR Determination Date; provided that if such rate does not appear on the
Official LIBOR Page or if fewer than two offered rates appear thereon, then
One-Month LIBOR means the rate determined by the Trustee to be the arithmetic
means (rounded, if necessary, to the nearest one-hundredth of one percent) of
two or more quotations, requested and received by the Trustee from the
principal London, England office of at least two major banks that are engaged
in transactions in the London, England interbank market in U.S. dollar deposits
for one month to prime banks in the London, England interbank market as of 11:00
a.m. (London, England time), on the date such quotations are requested and
received; and provided, further, that if on such date fewer than two quotations
are received, One-Month LIBOR means the rate determined by the Trustee to be
the arithmetic means (rounded, if necessary, to the nearest one-hundredth of
one percent) of the offered rates that one or more leading banks in New York,
New York (other than any bank affiliated with the Trustee) are quoting, as of
11:00 a.m. (New York City time) on such date, to leading European banks for
United States dollar deposits for one month; and provided, further, that if
such New York banks are not quoting such rates, One-Month LIBOR means the
One-Month LIBOR applicable to the immediately preceding Interest Accrual
Period.


“Outstanding” or
“Notes
Outstanding” or “Outstanding Notes” means all Notes which have been
authenticated and delivered by the Trustee under this Indenture, except:



 13
 









(a)           Notes canceled after
purchase in the open market or because of payment at, or redemption prior to,
maturity;


(b)           Notes for the payment
or redemption of which cash funds or Defeasance Obligations or any combination
thereof shall have been theretofore deposited with the Trustee (whether upon or
prior to the maturity or redemption date of any such Notes); provided that if
such Notes are to be redeemed prior to the maturity thereof, notice of such
redemption shall have been given or arrangements shall have been made therefor,
or waiver of such notice shall have been filed with the Trustee; and


(c)           Notes paid pursuant to
Section 2.07 hereof and Notes in lieu of which other Notes have been
authenticated under Section 2.07 or 2.08 hereof.


“Paying Agent” means
any bank or trust company, including the Trustee, designated pursuant to this
Indenture to serve as a paying agency or place of payment for the Notes, and
any successors designated pursuant to this Indenture.


“Participant(s)” means securities
brokers and dealers, banks, trust companies and clearing corporations which
have access, participates or otherwise (directly or indirectly), to the DTC
system.


“Permitted Liens” means
any of the following:


(a)           Liens for taxes and
assessments (i) which are not yet due and payable, (ii) the validity of which
are being contested in good faith by appropriate proceedings and with respect
to which adequate reserves determined in accordance with GAAP have been
established;


(b)           Liens arising in
connection with this Indenture and/or the other Transaction Documents; and,


“Person” means
an individual, partnership, corporation (including a business or statutory
trust), limited liability company, limited partnership, joint stock company,
trust, unincorporated association, joint venture, governmental (or any agency
or political subdivision thereof) or other entity, including, without
limitation, the Issuer, its parents, Affiliates and subsidiaries.


“Physical Property” has
the meaning set forth in clause (a) of the definition of “Delivery” in this
Section 1.01.


“Plan” means
an employee benefit plan defined in Section 3(3) of ERISA in respect of which
the Issuer or any ERISA Affiliate is, or within the immediately preceding six
years was, an “employer” as defined in Section 3(5) of ERISA.


“Pledge Agreement” means the Pledge
and Security Agreement dated as of May 7, 2007, among GMH Military Housing,
LLC, GMH Military Housing Investments, LLC, GMH Communities TRS, Inc., GMH
Military Housing Development, LLC, GMH Military Housing Construction, LLC, GMH
Military Housing Management, LLC, GMH Northeast Housing Design/Build LLC,
GMH/Benham Military Communities LLC, GMH/Phelps Military 



 14
 









Communities LLC,
GMH Military Housing - Carlisle/Picatinny Limited Partner LLC, GMH Military
Housing - Bliss/WSMR Limited Partner LLC, GMH AETC Housing Construction LLC,
GMH AETC Management/Development LLC, the Issuer, and the Trustee.


“Potential Event of Default” means an event which but for the lapse of time or the giving
of notice or both, would constitute an Event of Default.


“Preferred Returns” means the Issuer’s,
Guarantors, or their Affiliates’ or Subsidiaries’ return on equity in or other
distributions from the Military Housing Projects.


“Principal Payment Date”
means (i) any Interest Payment Date which is also a Redemption Date, and (ii) the Maturity Date.


“Principal Distribution Amount” means (i) with respect to any Principal Payment Date that is a
Redemption Date, the principal portion of the Redemption Price and (ii) with
respect to the Maturity Date, the Aggregate Outstanding Principal Amount of the
Notes.


“Proceeds” means
all “proceeds” (as defined in the UCC) of and all other profits, rentals or
receipts, in whatever form, arising from the collection, sale, lease, exchange,
assignment, licensing or other disposition of, or realization upon, any
Collateral, including, without limitation, all claims of the Issuer against
third parties for proceeds payable under, or unearned premiums with respect to,
or any contract rights with respect to any Collateral, as in each case whether
now existing or hereafter arising.


“Project Document(s)” means any and
all of the material agreements and related documents with respect to the
Military Housing Projects.


“Rating Agency” means
any nationally recognized municipal security ratings service (S&P, Moody’s
or Fitch) but only to the extent that such rating agency is then maintaining a
rating on the Notes at the request of the Issuer or the Initial Owner.


“Record Date” means
the Business Day preceding the next Interest Payment Date, provided that with
respect to overdue interest or interest due on any overdue amount or on other
than a regular Interest Payment Date, the Trustee may establish a special
record date of not more than 15 days before the date set for payment.


“Redemption Date” means
the redemption date specified in any notice of redemption prepared by the
Trustee pursuant to Section 3.02 of this Indenture.


“Redemption Price” means
the redemption price specified in any notice of redemption prepared by the
Trustee pursuant to Section 3.02 of this Indenture.


“Registrar” shall
have the meaning specified in Section 2.08 of this Indenture.


“Representation
Letter” means that certain
DTC Blanket Issuer Letter of Representations of the Issuer executed by the
Issuer and dated May 3, 2007.



 15
 









“Requirements of Law”
means, for any Person, requirements arising under any law, treaty, rule
or regulation, or determination of a Governmental Authority, in each case
applicable to or binding upon such Person or to which such Person is subject,
whether federal, state or local.


“Restricted
Securities” means Book-Entry
Notes offered and sold in reliance on the exemption from registration under
Rule 144A.


“Revenue Fund” means
the fund by that name created pursuant to Section 7.03 of this Indenture.


“Revenues” means
(i) all fees, whether base, incentive, or otherwise, (ii) income, paid to or
owed to, and (iii) distributions of any kind to the Issuer, any Guarantor, or
their Affiliates or Subsidiaries, in each case in connection with or related to
the management, development, construction, and any other service at the
Military Housing Projects.


“SAIF” means The
Savings Association Insurance Fund, as from time to time constituted, created
under the Financial Institution Reform, Recovery and Enhancement Act of 1989,
or, if at any time after the execution of this Indenture the Savings Association
Insurance Fund is not existing and performing duties now assigned to it, the
body performing such duties on such date.


“Schedule of
Drawings and Redemptions”
means the schedule attached to the Notes (or to the Global Certificate when the
Notes are held by the Note Depository) reflecting the date and amount of each
Drawing and each redemption made by the Issuer under the Notes.


“Secured Parties” means,
collectively, the Initial Owner, the present and future Owners and the Trustee.


“Secured Party” means
each of the Initial Owner, the present and future Owners and the Trustee.


“Securities Account”
shall have the meaning given such term in Section 8-501(a) of the UCC.


“Security Entitlement”
shall have the meaning given such term in Section 8-102(a)(17) of the
UCC.


“S&P” means
Standard & Poor’s, a
division of The McGraw-Hill Companies, Inc. or its successor in interest.


“Subsidiary” means,
with respect to any Person, any corporation or other entity of which securities
or other ownership interests having ordinary voting power to elect a majority
of the board of directors or other Persons performing similar functions are at
the time directly or indirectly owned or controlled by such Person, one or more
of the other subsidiaries of such Person or any combination thereof.


“Substitute
Depository” means a Note
Depository appointed pursuant to, and qualified in accordance with the
provisions of, Article XIII of this Indenture to replace a predecessor Note
Depository, but shall not include a successor of any Note Depository.



 16
 









“Tangible Net Worth”
means the “Cost Basis” Total Shareholder’s Equity, as calculated in
accordance with GAAP, as reflected on the most recent audited financial
statements of GMH.


“Telerate Page 3750”
means the display designated as page “3750” on the Bridge Telerate
Service (or such other page as may replace page 3750 on that report or such
other information service or system mutually agreed to in writing between the
Initial Owner and the Issuer for the purpose of displaying London interbank
offered rates of major banks).


“Termination Event” means an event
by which the principal amount of Notes is reduced to $0 by reason of the
redemption of Notes Outstanding, maturity, or otherwise.


“Transaction” means
the transactions contemplated by this Indenture and the other Transaction
Documents.


“Transaction Documents”
means this Indenture, the Project Documents, the Notes, the Note
Purchase Agreement, the Guaranty Agreement, the Pledge Agreement, the Fee
Letter, Account Control and Security Agreement, and all other agreements,
documents and instruments delivered pursuant thereto or in connection herewith.


“Trust Estate” means
the property, rights, monies, securities and other amounts assigned to the
Trustee on behalf of the Secured Parties as security for the Obligations
pursuant to the Granting Clause hereof.


“Trustee” means
U.S. Bank Trust National Association, or any successor trustee appointed
pursuant to this Indenture.


“Trustee Fees” means
the fees and expenses, including attorneys’ fees and expenses, of the Trustee
established pursuant to a written agreement between the Issuer and the Trustee.


“UCC” means
the Uniform Commercial Code as from time to time in effect in the specified
jurisdiction.


“Undrawn Amount Fee” means a per
annum fee in the amount equal to 10 basis points (0.1 percent) of the
difference between $100,000,000 and the outstanding principal balance of Notes,
payable monthly, in arrears, on each Interest Payment Date, or if the Issuer
has issued any Additional Notes, a per annum fee in the amount equal to 10
basis points (0.1 percent) of the difference between $125,000,000 and the
outstanding principal balance of Notes, payable monthly, in arrears, on each
Interest Payment Date,


“United States” or
“U.S.” means the United States of America,
its territories and provinces, any state of the United States and the District
of Columbia.


ARTICLE
II


THE NOTES


Section 2.01.        Authorized Amount of
Notes.  No Notes may be issued under
the provisions of this Indenture except in accordance with this Article.  The Notes shall be issued for 



 17
 









each Drawing as set forth in Section 2.02(f); provided, however, that
the principal amount due on the Notes shall be only such amount as has been
drawn by the Issuer and not redeemed as reflected by the Schedule of Drawings
and Redemptions attached to the Notes as Schedule A, and as confirmed by the
Trustee on the copy of such Schedule A, attached to the Global Certificate and
maintained by the Trustee.  The total
aggregate principal amount of Series 2007 Notes that may be Outstanding at any
time is hereby expressly limited to $100,000,000, except as provided
herein.  The redemption of any
Outstanding Notes pursuant to Article III of this Indenture shall not preclude
the issuance of new Notes in subsequent Drawings, so long as such subsequent
Drawings shall otherwise comply with the requirements of this Indenture.  Interest shall accrue only on such principal
amount of Notes as has been actually drawn and while such Notes remain Outstanding,
as reflected on the Schedule of Drawings and Redemptions maintained by the
Trustee.


Section 2.02.        Issuance of Notes.


(a)           The
Notes shall be designated “GMH Communities, LP Notes, Series 2007.”  The Notes shall be issuable as fully
registered Notes without coupons in the minimum denomination of U.S. $100,000
and integral multiples of U.S. $5,000 in excess thereof.  The Notes shall be initially in the form of a
Global Certificate numbered “R-1”.  As
further provided for in Section 2.11, the ownership of each Note shall be
registered in the registration books kept by the Registrar in the name of CEDE
& Co., nominee for the Note Depository. 
Upon initial authentication and Delivery of the initial Drawing, the
Outstanding principal amount of Notes at any time shall not be less than
$100,000, except upon a Termination Event.


(b)           The
Notes shall mature on the Maturity Date, and the Notes shall be subject to
optional redemption as provided in Section 3.01 of this Indenture.


(c)           The
Notes shall bear interest during each Interest Accrual Period at the Note Rate,
payable on the related Interest Payment Date, with interest accruing on the
Outstanding amount on the basis of the actual number of days elapsed in the
Interest Accrual Period and a year of 360 days.


(d)           The
Notes shall be dated the date of initial authentication and delivery thereof
and the amounts drawn thereunder shall bear interest from the Interest Payment
Date next preceding their date of registration and authentication unless any
such Note is registered and authenticated as of an Interest Payment Date, in
which case it shall bear interest from said Interest Payment Date; or unless a
Note is registered and authenticated prior to June 1, 2007, in which event such
Note shall bear interest from the date of initial authentication and delivery
thereof; or unless, as shown by the records of the Trustee, interest on the
Notes shall be in default in which event such Note shall bear interest from the
date to which interest was last paid on such Note.


(e)           The
principal of and interest on the Notes shall be payable in any coin or currency
of the United States of America which at the time of payment is legal tender
for the payment of public and private debts. 
With the exception of any redemption of the Notes on a Principal Payment
Date that is a Redemption Date pursuant to Article III of 



 18
 









this
Indenture, the then-Outstanding principal of the Notes shall be payable on the
Maturity Date, in the amounts and in the manner specified in this
Indenture.  On the Maturity Date,
principal of the Notes shall be payable upon presentation and surrender thereof
at the designated corporate trust office of the Trustee or any successor
thereto or at such other place as may be provided for by the appointment of any
other Paying Agent appointed under this Indenture.  Interest on the Notes shall be transmitted by
wire transfer in immediately available funds to the registered owners (as they
appear on the registration books maintained by the Trustee as of the close of
business on the applicable Record Date, pursuant to Section 2.08 hereof) to the
bank account number on file with the Paying Agent as of the Record Date upon
written request therefor by the owner thereof for the appropriate Interest
Payment Date.


(f)            Prior
to making any Drawing under this Indenture, the Issuer must have paid the
Commitment Fee.  The Issuer may make as
many Drawings as it so chooses, subject to the terms this Indenture.


(i)            The
Issuer’s first Drawing must be in an amount of $90,705,000, which is sufficient to retire and terminate the
Issuer’s Existing Line of Credit, and which shall be used in whole to retire
and terminate the Issuer’s Existing Line of Credit and pay the Commitment Fee
to the Initial Owner.  The first Drawing
shall be made on May 7, 2007.  To the
extent the Issuer’s first Drawing is insufficient to pay the Commitment Fee and
$5,000 of the Initial Owner’s expenses, the Issuer shall immediately pay, or
cause to be paid, the deficiency to the Initial Owner, as set forth in the Fee
Letter.


(ii)           Any
Drawing shall be in an amount not less than $2,000,000 (unless otherwise agreed
to in writing by the Initial Owner), and may be made at any time after three
(3) Business Days of the delivery of a certificate to the Trustee and the
Initial Owner and any transferee of the Initial Owner whose name and address
has been supplied, of such Drawing, which certificate shall be substantially in
the form attached hereto as Exhibit D, and shall provide the
following:  (A) the cumulative
principal amount of all prior Drawings, (B) the then aggregate principal
amount of Notes Outstanding, (C) the principal amount of the requested
Drawing, (D) the date of the requested Drawing, which date shall be a
Business Day not less than three (3) Business Days subsequent to the date of
the certificate, (E) a statement authorizing the Trustee to revise the Schedule
of Drawings and Redemptions set forth in Exhibit E, (F) a certification
that no Event of Default exists under this Indenture, (G) all representations,
warranties and covenants contained in this Indenture and in the Transaction
Documents are true and correct in all material respects as of the date of the
requested Drawing and the terms for additional Drawings under the Note Purchase
Agreement have been satisfied as of the date of the requested Drawing, (H) the Transaction
Documents are in full force and effect, (I) a certification that Commitment
Fees with respect to the Additional Notes, and Undrawn Amount Fees have been
paid to the Initial Owner, in the manner and place specified by the Initial
Owner, and (J) such other documents, instruments, evidence or certificates as
the Trustee may reasonably request.



 19
 









(iii)          After
each Drawing, the Trustee is hereby instructed and authorized to revise the
Schedule of Drawings and Redemptions set forth in Exhibit E, and shall provide
copies thereof to the Issuer, GMH, the Guarantors, and the Initial Owner within
seven (7) Business Days after such Drawing.


Section
2.02A.  Notes
as General Obligations of the Issuer.  In consideration of the acceptance by the
Trustee of the trusts herein created and of the purchase and acceptance of
Notes issued hereunder by any who shall from time to time be holders thereof:


(a)           the provisions of this
Indenture shall be a contract of the Issuer with the Trustee for the benefit of
the holders of the Notes;


(b)           the Issuer pledges to
the Trustee for the payment of the principal of, and interest on the Notes and
grants a security interest in, the Collateral, including, without limitation,
all money and other assets and income held in and receivable by Funds
established by or pursuant to this Indenture, which pledge constitutes a first
lien on such pledged monies and revenues;


(c)           the pledge made and
security interests granted herein and the covenants and agreements herein set
forth, to be performed by and on behalf of the Issuer, shall be for the equal
benefit, protection and security of holders of any and all such Notes, all of
which, regardless of the time or times of their issue or maturity, shall be of
equal rank without preference, priority or distinction of any Note over any
other Note, except as expressly provided or permitted herein;


(d)           this pledge is valid
and binding from the time when made, and the property so pledged and hereafter
received by the Issuer shall immediately be subject to the lien thereof without
any physical delivery or further act, and the lien of such pledge shall be
valid and binding as against all parties having claims of any kind in tort,
contract or otherwise against the Issuer, whether or not such parties have
notice thereof; and,


(e)           the Notes are general
obligations of the Issuer and are payable from any of the Issuer’s revenues,
assets or monies, subject only to agreements made with holders of notes and
bonds, other than the Notes, pledging particular revenues, monies or assets for
the payment thereof.


Section 2.03.        Execution.  The Notes shall be executed on behalf of the
Issuer with the manual or facsimile signatures of its Authorized Officer.  The Authorized Officer executing Notes on
behalf of the Issuer shall not be personally liable on the Notes by reason of
the issuance hereof.  In case any
Authorized Officer whose signature or whose facsimile signature shall appear on
the Notes shall cease to be such an Authorized Officer before the delivery of
such Notes, such signature or the facsimile signature thereof shall
nevertheless be valid and sufficient for all purposes, the same as if he had
remained in office until delivery.  Only
such of the Notes as shall bear thereon a certificate of authentication in the
form hereinbefore recited, manually executed by the Trustee or its appointed
agent, shall be valid or obligatory for any purpose or entitled to the benefits
of this Indenture, and such certificate of the Trustee shall be conclusive 



 20
 









evidence that
the Notes so authenticated have been duly executed, authenticated and delivered
hereunder and are entitled to the benefits of this Indenture.


Section 2.04.        Authentication.  No Note shall be valid or obligatory for any
purpose or be entitled to any security or benefit under this Indenture unless
and until a certificate of authentication on such Note substantially in the
form set forth in Exhibit A hereto shall have been duly executed by the manual
signature of the Trustee, and such executed certificate of the Trustee upon any
such Note shall be conclusive evidence that such Note has been authenticated
and delivered under this Indenture.  The
Trustee’s certificate of authentication on any Note shall be deemed to have
been executed by it if signed by an authorized officer or signatory of the
Trustee, but it shall not be necessary that the same officer or signatory sign
the certificate of authentication on all of the Notes issued hereunder.


Section 2.05.        Form of Notes.  The Notes shall be issued substantially in
the form set forth in Exhibit A with such variations, omissions and insertions
as are permitted or required by this Indenture.


Section 2.06.        Delivery of Notes.  Upon the Trustee’s receipt of immediately
available funds from the Initial Owner, the Issuer shall execute and deliver to
the Trustee, and the Trustee shall authenticate, the Notes and deliver them to
the Initial Owner as purchaser thereof, as directed by the Issuer as
hereinafter in this Section provided.


(a)           Prior to the delivery
by the Trustee of the first Drawing there shall be filed or deposited with the
Trustee the following:


(i)            A copy, duly certified
by the Secretary or other Authorized Officer of the Issuer of the resolution of
the Issuer authorizing the issuance of the Notes and the execution and delivery
of this Indenture.


(ii)           An executed counterpart
of the Note Purchase Agreement.


(iii)          An executed copy of the
Notice of First Drawing, which is in substantially similar form to the Form of
Notice of Drawing set forth in Exhibit D, pursuant to Section 2.02(f) above, to
the Trustee on behalf of the Issuer and signed by an Authorized Officer of the
Issuer to authenticate and deliver the Notes in accordance with the resolution
of the Issuer; and,


(iv)          An opinion of counsel to
the Issuer stating that (A) the Indenture and the Note Purchase Agreement have
been duly and validly authorized by the Issuer and this Indenture and the Note
Purchase Agreement have been executed and delivered by the Issuer and, assuming
proper authorization and execution by the other parties thereto, this Indenture
and the Note Purchase Agreement are valid and binding agreements, enforceable
against the Issuer in accordance with their terms (subject to any applicable
bankruptcy, reorganization, insolvency, moratorium or similar law affecting the
enforcement of creditors’ rights generally) and (B) the Notes, upon execution
by the Issuer and authentication by the Trustee in accordance with the terms of
this Indenture, are valid and binding obligations, enforceable against the
Issuer in accordance with their terms (subject 



 21
 









to any applicable bankruptcy, reorganization,
insolvency, moratorium or similar law affecting the enforcement of creditors’
rights generally).


Upon receipt of these
documents and amounts, the Trustee shall authenticate and deliver the Notes of
the first Drawing to the Initial Owner as purchaser thereof, but only upon
payment to the Trustee of the purchase price of the first Drawing.  The proceeds received by the Trustee from the
sale of the Notes of the first Drawing shall be deposited in the Note Proceeds
Fund.


Section 2.07.        Mutilated, Lost, Stolen or
Destroyed Notes.  In the event any
Note is mutilated, lost, stolen or destroyed, at the request of the Owner of
any such Note, the Issuer shall execute (if the Trustee does not have executed
Notes in its possession) and the Trustee shall authenticate and deliver a new
Note of like date, interest rate, maturity and denomination as that Note which
was mutilated, lost, stolen or destroyed; provided that, in the case of any
mutilated Note, such mutilated Note shall first be surrendered to the Trustee,
and, in the case of any lost, stolen or destroyed Note, there shall be first
furnished to the Trustee evidence of such loss, theft or destruction
satisfactory to the Trustee, together with indemnity satisfactory to it.  In the event any such Note shall be about to
mature or have matured or been called for redemption, instead of issuing a
duplicate Note, the Trustee shall, at the written direction of the Issuer, pay
the same without surrender thereof.  The
Issuer and the Trustee may charge the owner of such Note their reasonable fees
and expenses in this connection.


Section 2.08.        Registration and Exchange
of Notes; Persons Treated as Owners.


(a)           The
Issuer shall cause books for the registration and for the transfer of the Notes
as provided in this Indenture to be kept by the Trustee, which is hereby
constituted and appointed the Note Registrar of the Issuer (the “Registrar”).


(b)           Upon
surrender for registration of transfer of any Note at its designated corporate
trust office and upon satisfaction of the conditions below, the Registrar shall
authenticate and deliver in the name of the transferee or transferees a new
Note for the aggregate principal amount which the registered owner is entitled to
receive.


(c)           The
Initial Owner represents that it:  (i) is
a institutional investor, and (ii) if the Initial Owner disposes of all or a
portion of the Notes, it will advise the transferee(s) that the transaction is
being effected in reliance on Rule 144A, and to that end, will transfer only
(A) to a Qualified Institutional Buyer under Rule 144A of the Securities Act,
(B) to a trust or custodial arrangement the beneficial owners of which are
required to be Qualified Institutional Buyers, and in the case of (A) above,
which buyer has acknowledged that it has made its own review of the credit and
further promises to require such assurances from any succeeding purchaser.


(d)           All
Notes presented for transfer or exchange (if so required by the Issuer or the
Trustee), shall be accompanied by a written instrument or instruments of
transfer or authorization for exchange, in form and with guaranty of signature
satisfactory to the Trustee, duly executed by the registered owner or by such
registered owner’s duly authorized attorney. 
The Trustee shall require payment of a sum sufficient to cover any
expenses incurred in making such transfer or exchange and any tax or other
governmental 



 22
 









charge that
may be imposed in relation thereto but may not impose any other service charge
or fee.  The Issuer and the Trustee shall
not be required (i) to issue, transfer or exchange any Notes during a period
beginning on the date which is fifteen (15) days prior to the day on which the
applicable notice of redemption is given and ending on the Redemption Date, or
(ii) to transfer or exchange any Notes selected, called or being called for
redemption or purchase in whole or in part. 
If the Trustee establishes a special record date, it shall provide
notice by first class mail to registered owners of all Notes Outstanding at
least ten (10) days before such special record date or at such other time and
manner as the Trustee may deem appropriate.


(e)           New
Notes delivered upon any transfer or exchange shall be valid general
obligations of the Issuer, evidencing the same debt as the Notes surrendered,
shall be secured by this Indenture and shall be entitled to all of the security
and benefits hereof to the same extent as the Notes surrendered.


(f)            The
Person in whose name any Note is registered shall be deemed the Owner thereof
by the Issuer, the Trustee and the Registrar for all purposes under this
Indenture, and any notice to the contrary shall not be binding upon the Issuer,
the Trustee or the Registrar.  All
payments of principal of or interest on the Notes shall be made only to or upon
the order of the Owner thereof or his legal representative.  All such payments shall be valid and
effectual to satisfy and discharge the liability upon such Notes to the extent
of the sums so paid.


(g)           The
Issuer will, upon the request of any Holder or any Person that has a beneficial
interest in the Notes provide such financial and other information as shall be
required to be made available by Rule 144A unless the Issuer is subject to and
in compliance with Section 13 or 15(d) of the Securities Exchange Act of 1934,
as amended (the foregoing agreement being for the benefit of the Holders of the
Notes and prospective purchasers of the Notes designated by such Holders).  Unless waived by the Issuer, if the Notes are
in book-entry form, the Participants will identify Persons who will be
permitted to receive such information.


(h)           Each
transferee of a beneficial interest in a Note will be deemed to have
represented one of the following:  (i)
the transferee is neither an employee benefit plan or other retirement
arrangement, including individual retirement accounts and annuities, Keogh
plans and collective investment funds and separate accounts and other entities
in which such plans, accounts or arrangements are invested, including insurance
company general accounts, that is subject to ERISA or the IRC (each, a “Tax
Favored Plan”) nor any person who is directly or indirectly purchasing such
Notes or interest therein with the assets of a Tax Favored Plan, (i) the
transferee’s purchase and holding of the Notes or interest therein is exempt
from the prohibited transaction provisions of Section 406 of ERISA and Sections
4975 of the IRC under one or more prohibited transaction exemptions issued by
the U.S. Department of Labor or (iii) the transferee has received an opinion of
counsel which establishes to the satisfaction of such transferee that the
acquisition and holding of the Notes will not result in a violation of Section
406 of ERISA or Sections 4975 or 503 of the IRC or result in the imposition of
excise taxes under Section 4975 or other similar provision of the IRC.



 23















Section 2.09.                         Cancellation
of Notes.  Whenever any Outstanding
Note shall be delivered to the Trustee for cancellation pursuant to this
Indenture, upon payment of the principal amount thereof represented thereby or
for replacement pursuant to Section 2.07 hereof or transfer or exchange
pursuant to Section 2.08 hereof, such Note shall be canceled and disposed of by
the Trustee in accordance with its customary procedures.


Section 2.10.                         CUSIP
Numbers.  The Issuer, in issuing the
Notes may use “CUSIP” numbers (if then generally in use), and, if so, the
Trustee shall use “CUSIP” numbers in notices of redemption as a convenience to
Owners; provided that any such notice may state that no representation is made
as to the correctness of such numbers either as printed on the Notes or as
contained in any notice of redemption and that reliance may be placed only on
the other identification numbers printed on the Notes, and any such redemption
shall not be affected by any defect in or omission of such numbers.  The Issuer will promptly notify the Trustee
in writing of any change in the “CUSIP” numbers.


Section 2.11.                         Book-Entry
Notes.


(a)                                  The
Owner of all of the Series 2007 Notes shall initially be the Note Depository,
provided that the Notes shall be registered in the Note Register in the name of
CEDE & Co., the nominee of the Note Depository.  Payment of principal, redemption premium, if
any, and interest payment on any Note registered in the name of CEDE & Co.
shall be made on the applicable Interest Payment Date or Principal Payment Date
by wire transfer of same day funds to the account of CEDE & Co.  Such payments shall be made to CEDE & Co.
at the address which is, on the Record Date, shown for CEDE & Co. in the
registration books of the Registrar.


(b)                                 The
Notes shall be issued in the form of a single, separate, authenticated Note,
fully registered in the aggregate principal amount due at maturity, and will be
deposited with the Note Depository.  The
Issuer, Trustee, Paying Agent, Registrar, and Authenticating Agent, as the case
may be, may treat the Note Depository (or its nominee) as the sole and
exclusive owner of the Notes registered in its name for the purpose of payment
of the principal, redemption premium, if any, or interest on the Notes,
obtaining any consent or other action to be taken by Noteholders and for all
other purposes whatsoever.  The Issuer,
the Trustee, the Paying Agent, the Registrar, and Authenticating Agent, as the
case may be, shall not have any responsibility or obligation to any
Participant, any person claiming a beneficial ownership interest in the Notes
under or through the Note Depository or any Participant, or any other person
which is not shown on the registration books as being a Noteholder, as to:  the accuracy of any records maintained by the
Note Depository or any Participant; the payment of the Note Depository or any
Participant of any amount in respect of the principal, redemption price, if
any, or interest on the Notes; the selection by the Note Depository or any
Participant of any person to receive payment in the event of a partial
redemption of the Notes; or any consent given or other action taken by the Note
Depository as Noteholder.  The Issuer
shall pay all principal of, redemption premium, if any, and interest on the
Notes only to the Note Depository, and all such payments shall be valid and
effective to fully satisfy and discharge the Issuer’s obligations with respect
to the principal of, redemption premium, if any, and interest on the Notes to
the extent of the sum or sums so paid.  No



 24
 









person other than the Note Depository shall
receive an authenticated Note evidencing the obligation of the Issuer to make
payments of principal of, redemption premium, if any, and interest on the Notes
pursuant to this Indenture.  Upon
delivery by the Note Depository of written notice to the effect that the Note
Depository has determined to substitute a new nominee in place of CEDE &
Co., and subject to the provisions herein with respect to Record Dates, the
words “CEDE & Co.” in this Indenture shall refer to such new nominee of the
Note Depository.


(c)                                  In
the event the Issuer determines that it is in the best interest of the
Beneficial Owners or the Issuer that the Owners be able to obtain Note
certificates and that such certificates should, therefore, be made available,
and notifies the Note Depository of such determination, then the Note
Depository will notify the Participants of the availability of such
certificates through the Note Depository. 
In such event, the Trustee shall authenticate and shall transfer and
exchange Note certificates as requested by the Note Depository and any other
Noteholders in appropriate amounts.  The
Note Depository may determine to discontinue providing services with respect to
such Notes at any time by giving written notice to the Issuer, the Registrar
and the Trustee pursuant to Article XIII and discharging its responsibilities
with respect thereto under applicable law. 
Under such circumstances (if there is no successor Note Depository), the
Issuer shall be obligated to deliver Notes as described in this Indenture.  In the event Note certificates are issued,
the provisions of this Indenture shall apply to, among other things, the
transfer and exchange of such certificates and the method of payment of
principal, principal, redemption premium, if any, and interest on such
certificates.  Whenever the Note
Depository requests the Issuer to do so, the Issuer will cooperate with the
Note Depository in taking appropriate action after reasonable notice (i) to
make available one or more separate certificates evidencing the Notes to the
Participant having Notes credited to the Note Depository account, or (ii) to
arrange for another securities depository to maintain custody of certificates
evidencing the Notes.


(d)                                 Notwithstanding
any other provision of this Indenture to the contrary, so long as any Note is
registered in the name of CEDE & Co., as nominee of the Note Depository,
all payments with respect to principal, redemption premium, if any, and
interest on such Note and all notices with respect to such Note shall be made
and given, respectively, to the Note Depository as provided in the
Representation Letter.


(e)                                  In
connection with any notice or other communication to be provided to Noteholders
pursuant to this Indenture by the Issuer with respect to any consent or other
action to be taken by Noteholders, the Trustee shall establish a record date
for such consent or other action and give the Note Depository notice of such
record date not less than fifteen (15) days in advance of such record date, to
the extent possible.  Notice to the Note
Depository shall be given only when the Note Depository is the sole Noteholder.


(f)                                    the
provisions of this Section shall be in full force and effect;


(g)                                 the
Registrar shall be entitled to deal with the Note Depository for all purposes
of this Indenture (including the payment of principal of and interest on the 



 25
 









Notes and the giving of instructions or
directions hereunder) as the sole holder of the Notes, and shall have no
obligation to the Note Owners;


(h)                                 to
the extent that the provisions of this Section conflict with any other
provisions of this Indenture, the provisions of this Section shall control;


(i)                                     the
rights of Note Owners shall be exercised only through the Note Depository and
shall be limited to those established by law and agreements between such Owners
and the Note Depository and/or the Participants.  Unless and until Definitive Notes are issued
pursuant to Section 2.13, the Note Registrar shall not register any transfer of
a beneficial interest in a Book-Entry Note; and the initial Note Depository
will make book-entry transfers among the Participants and receive and transmit
payments of principal of and interest on the Notes to such Participants; and


(j)                                     whenever
this Indenture requires or permits actions to be taken based upon instructions
or directions of the Controlling Party, the Note Depository shall be deemed to
represent such percentage only to the extent that it has received instructions
to such effect from the Controlling Party and/or Participants owning or
representing, respectively, such required percentage of the beneficial interest
in the Notes and has delivered such instructions to the Trustee.


Section 2.12.                         Notice to
Note Depository.  Whenever a notice
or other communication to the Owners is required under this Indenture, unless
and until Definitive Notes shall have been issued to such Owners pursuant to
Section 2.13, the Trustee shall give all such notices and communications
specified herein to be given to Owners to the Note Depository, and shall have
no obligation to such Owners.


Section 2.13.                         Definitive
Notes.  If (i) the Note Depository is
no longer willing or able to properly discharge its responsibilities with
respect to the Book-Entry Notes and the Issuer is unable to locate a qualified
successor, or (ii) after the occurrence of an Event of Default hereunder, the
Controlling Party of the Book-Entry Notes advises the Note Depository in
writing that the continuation of a book-entry system through the Note
Depository is no longer in the best interests of such Owners and the Note
Depository consents, then the Note Depository shall notify all Owners and the
Trustee of the occurrence of any such event and of the availability of
Definitive Notes to Owners requesting the same. 
Upon surrender to the Registrar of the typewritten Notes representing
the Book-Entry Notes by the Note Depository, accompanied by registration
instructions, the Issuer shall execute and the Registrar shall authenticate the
Definitive Notes in accordance with the instructions of the Note Depository and
this Indenture.  Neither the Issuer nor
the Registrar shall be liable for any delay in delivery of such instructions
and may conclusively rely on, and shall be protected in relying on, such
instructions.  Upon the issuance of
Definitive Notes, the Registrar and the Trustee shall recognize the holders of
the Definitive Notes as Owners.


Section 2.14.                         Undrawn
Amount Fee.  On each Interest Payment
Date commencing on and after June 1, 2007, the Issuer shall pay, or cause to be
paid, the Undrawn Amount Fee.



 26
 









Section 2.15.                         Additional
Notes.  The Issuer may issue
Additional Notes in the total aggregate principal amount of $25,000,000,
thereby permitting the total indebtedness permitted under this Indenture to
exceed $100,000,000, which Additional Notes shall stand on parity or equality
with the Initial Notes and be payable by the Issuer from, among other things,
the Collateral, including, but not limited to, the Revenues and any Additional
Collateral delivered by the Issuer pursuant to this Indenture, if the following
conditions are met:


(a)                                  the
sum of (i) the Aggregate Outstanding Principal Amount of the Notes, after
giving effect to the issuance of the proposed Additional Notes, and (ii) the
projected accrued interest on the Aggregate Outstanding Principal Amount of the
Notes at the Note Rate, does not exceed 75% (or such other percentage agreed to
by the Initial Owner and the Controlling Party) of the present value of the
Revenues available to the Issuer for the remaining term of the Initial
Development Period, as specified on the Summary of Revenues delivered by the
Issuer to the Trustee with respect to the proposed issuance of Additional
Notes;


(b)                                 no
Event of Default has occurred and is continuing under this Indenture;


(c)                                  there
is no default under the Pledge Agreement;


(d)                                 there
is no default under the Guaranty Agreement;


(e)                                  there
is no default under the Account Control and Security Agreement;


(f)                                    the
Issuer has paid to the Initial Owner that portion of the Commitment Fee
pertaining to the Additional Notes;


(g)                                 there
is no breach of any obligation under any Irrevocable Payment Instruction; and,


(h)                                 the
Outstanding Principal Amount of the Notes, after giving effect to the issuance
of Additional Notes, does not exceed $125,000,000.


ARTICLE
III


OPTIONAL
REDEMPTION OF NOTES BEFORE MATURITY


Section 3.01.                         Optional
Redemption of the Notes.  The Notes
or any portion thereof are subject to optional redemption at the option of the
Issuer on any Interest Payment Date, at a redemption price equal to the
aggregate amount of 100% of the principal amount of each Note redeemed plus
interest accrued to, but excluding, such date of redemption, and expenses in
connection with such redemption.  If the
Notes Outstanding following redemption of the Notes pursuant to this paragraph
would be $0, the Trustee shall confirm such redemption amount and Termination
Event with the Issuer by telephone, promptly confirmed in writing.



 27
 









Section 3.02.                         Notice of
Redemption.


(a)                                  The
Issuer shall provide written notice to the Trustee and the Initial Owner of its
election to redeem the Notes not less than five (5) Business Days prior to the
Interest Payment Date fixed for redemption. 
Notice of the call for any redemption, identifying the Notes or portions
thereof to be redeemed, shall be given by the Trustee by providing a copy of
the redemption notice by overnight delivery or facsimile, receipt confirmed in
writing, as to Owners of at least $1,000,000 in principal amount of the Notes
not less than two (2) Business Days prior to the Interest Payment Date fixed
for redemption to the registered owner of each Note to be redeemed at the
address shown on the registration books maintained by the Trustee.  Failure to give such notice to any
Noteholder, or any defect therein, shall not affect the validity of any
proceedings for the redemption of any other Notes.  Any Owner owning at least $1,000,000 in
principal amount of the Notes may request that a second copy of the notice of
redemption be sent to a second address provided to the Trustee in writing prior
to the Record Date for such redemption. 
The notice of redemption shall set forth the complete title of the
issue, CUSIP number, the date of the issue, Note numbers, the Maturity Date,
the date fixed for redemption, the redemption price to be paid and, if less
than all of the Notes then Outstanding shall be called for redemption, the
distinctive numbers and letters of such Notes to be redeemed and, in the case
of Notes to be redeemed in part only, the portion of the principal amount
thereof to be redeemed, the place or places of redemption, including the name,
address and phone number of a contact person, and a statement to the effect
that interest on the Notes or portions thereof thus called shall no longer
accrue after the date fixed for redemption. 
If applicable, such notice shall provide that redemption of the Notes is
conditioned upon monies being available for such purpose on the date of
redemption.  Any notice mailed as
provided in this Section shall be conclusively presumed to have been duly given
upon mailing, whether or not the relevant Owner receives the notice.


(b)                                 Issuer
agrees to indemnify the Trustee and Noteholder and to hold the Trustee and the
Noteholder harmless from any actual third-party out-of-pocket loss or expense
which the Trustee and/or the Noteholder sustains or incurs as a consequence of
any payment (whether voluntary or mandatory) of the Notes on a day that is not
an Interest Payment Date or a Principal Payment Date.  This provision shall survive payment of the
Notes and the satisfaction of all other obligations of Issuer under this
Agreement and the other Loan Documents.


Section 3.03.                         Redemption
Payments.  Not later than 10:00 a.m.
Eastern time on the date fixed for redemption, funds shall be deposited with
the Trustee to pay, and the Trustee is hereby authorized and directed to apply
such funds to the payment of, the Notes or portions thereof called, together
with accrued interest thereon to, but excluding, the redemption date, and
expenses in connection with such redemption. 
Upon the giving of notice and the deposit of funds for redemption,
interest on the Notes or portions thereof thus called shall no longer accrue
after the date fixed for redemption.  No
payment shall be made by the Trustee upon any Note or portion thereof called
for redemption until such Note or portions thereof shall have been delivered
for payment or cancellation or the Trustee shall have received the items
required by Section 2.07 hereof with respect to any mutilated, lost, stolen or
destroyed Note.



 28
 









Section 3.04.                         Cancellation.  All Notes which have been redeemed, paid or
retired, or received by the Trustee for exchange, shall not be reissued but
shall be canceled by the Trustee in accordance with this Indenture.


Section 3.05.                         Partial
Redemption of Notes.  Upon surrender
of any Note for redemption in part only, the Trustee shall authenticate and
deliver to the Owner thereof a new Note in aggregate principal amount equal to
the unredeemed portion of the Note surrendered.


Section 3.06.                         Effect of
Redemption.  Notice of redemption
having been duly given as provided in this Article, and monies being held by
the Trustee for payment of the redemption price of, and interest accrued to the
redemption date on, the Notes so called for redemption on the redemption date
designated in such notice, said Notes shall become due and payable at the
redemption price specified in such notice and interest on the Notes so called
for redemption shall cease to accrue from and after said redemption date.  Said Notes shall cease to be entitled to any
benefit or security under this Indenture, and the Owners of said Notes shall
have no rights in respect thereof except to receive payment of said redemption
price and accrued interest.


All Notes redeemed
pursuant to the provisions of this Article shall be cancelled upon surrender
thereof and disposed of by the Trustee in accordance with its customary
procedures.  After every redemption, the
Trustee is hereby instructed and authorized to 
revise the Schedule of Drawings and Redemptions set forth in Exhibit E,
and shall provide copies thereof to the Issuer, the Guarantors, and the Initial
Owner within seven (7) Business Days after such redemption.


ARTICLE
IV


REPRESENTATIONS
AND WARRANTIES OF ISSUER


The Issuer represents and
warrants to the Trustee, each Owner and the Initial Owner, on the Effective
Date, as follows:


Section 4.01.                         Organization
and Good Standing.  It is a limited
partnership duly organized, validly existing and in good standing under the
laws of the State of Delaware and has full power, authority and legal right to
own its properties and conduct its business, and to execute, deliver and
perform its obligations under this Indenture and the other Transaction
Documents to which it is a party.


Section 4.02.                         Due
Qualification.  It is qualified to do
business and is in good standing in each state required in order to conduct its
business, and has obtained all necessary licenses, consents, authorizations,
approvals, exemptions of or registrations or filings, from or with any
Governmental Authority, necessary for the valid execution, delivery and
performance by the Issuer of this Indenture and the other Transaction Documents
to which it is a party.


Section 4.03.                         Due
Authorization.  The execution and
delivery of this Indenture and the other Transaction Documents by the Issuer to
which it is a party and the consummation of the transactions provided for in
this Indenture have been duly authorized by the Issuer by all necessary limited
partnership action on its part.



 29
 









Section 4.04.                         No
Conflict.  The execution and delivery
of this Indenture and the other Transaction Documents to which it is a party,
the performance of the Transaction and fulfillment of the terms hereof will not
conflict with, result in any breach of any of the material terms and provisions
of, or constitute (with or without notice or lapse of time or both) a default
under, any indenture, contract, agreement, mortgage, deed of trust or other
instrument to which the Issuer is a party or by which it or any of its
properties or business are bound.


Section 4.05.                         No
Violation.  The execution and
delivery of this Indenture and the other Transaction Documents to which it is a
party, the performance of the Transaction and fulfillment of the terms hereof
will not conflict with or violate (a) the Issuer’s Agreement of Limited
Partnership or other organizational documents or (b) any Requirements of Law
applicable to the Issuer.


Section 4.06.                         No
Proceedings.  Except as set forth in
Schedule 4.06, there are no proceedings, suits, claims, or investigations
pending or, to the knowledge of the Issuer, threatened against the Issuer, GMH
or its parents, Subsidiaries, or Affiliates, before or by any court, public
board, any arbitration body or any Governmental Authority (a) asserting the
invalidity of this Indenture or the other Transaction Documents, (b) seeking to
prevent the consummation of the Transaction, (c) seeking any determination or
ruling that could materially and adversely affect the performance by the Issuer
of its obligations under this Indenture, or (d) seeking any determination or
ruling that could materially and adversely affect the validity or
enforceability of this Indenture or the other Transaction Documents.


Section 4.07.                         Binding
Obligation.  This Indenture and each
other Transaction Document to which the Issuer is a party are in full force and
effect, and each constitutes the legal, valid and binding obligation of the
Issuer, enforceable against the Issuer in accordance with their respective
terms, except as (a) as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect affecting the enforcement of creditors’ rights in general,
and (b) as such enforceability may be limited by general principles of equity
(whether considered in a suit at law or in equity).


Section 4.08.                         Accuracy
in Reporting.  All written
information, including, but not limited to, the Initial Summary of Revenues,
the exhibits to this Indenture, financial statements, including, but not
limited to, the audited financial statements set forth in Exhibit F and the
Closing Proforma set forth in Exhibit H, documents, books, records or reports
furnished by the Issuer to the Initial Owner prior to the execution of this
Indenture in connection with this Indenture, and during any due diligence
conducted by the Initial Owner relating to this Transaction, in each case to
the extent related to the Transaction, is accurate in all material respects as
of the date it is dated or as of the date so furnished, and, when taken as a
whole, to the Issuer’s knowledge, does not contain any untrue statement of
material fact and does not omit and to state a material fact necessary in order
to make the statements contained therein, in light of the circumstances under
which they were made, not misleading. 
The Project Documents consist of all of the material agreements and
related documents for the Issuer’s, GMH’s, and Guarantors’ military housing
business, and such agreements and documents have not been amended, terminated,
or otherwise changed subsequent to the Trustee’s and the Initial Owner’s review
thereof prior to the Effective Date. 
There are no defaults or events which with the passage of time and/or
the giving of notice, or both, would be a default under the Project Documents
by 



 30
 









Issuer, GMH,
the Guarantors, or their Affiliates or Subsidiaries, or would permit an offset
against the Collateral, or any portion thereof.


Section 4.09.                         Location
of Issuer and Records.  The Issuer’s
principal place of business and chief executive office and office where the
records concerning the Collateral are kept is located at 10 Campus Blvd.,
Newtown Square, Pennsylvania 19073.  “GMH
Communities, LP” is the correct legal name of the Issuer indicated on the
public records of the Issuer’s jurisdiction of organization which shows the
Issuer to be organized.


Section 4.10.                         Federal
Tax Identification Number.  The
federal tax identification number of the Issuer is 20-1162699.


Section 4.11.                         Taxes.  The Issuer has filed or caused to be filed
all Federal, state and local tax returns which are required to be filed by it,
and has paid or caused to be paid all taxes prior to such taxes becoming
delinquent, other than any taxes or assessments the validity of which are being
contested in good faith by appropriate proceedings.


Section 4.12.                         Solvency.  The Issuer is not “insolvent” (as such term
is defined in the Bankruptcy Code).


Section 4.13.                         Transaction
Documents.  No violation, default, or
breach of any material term, representation, warranty, covenant, or agreement
in any material Transaction Document exists or has occurred (expressly
excluding solely the technical default related to the online unit requirement
in the Navy Northeast military housing project due to the 2005 Base Realignment
and Closure order).


Section 4.14.                         Compliance
with Law.  The Issuer, GMH, the
Guarantors, and their Affiliates and Subsidiaries, and all of their business
activities, including, but not limited to, the Military Housing Projects and
related businesses, are in compliance in all material respects with all
applicable laws, including, but not limited to, the Sarbanes-Oxley Act of 2002
and the rules and regulations promulgated in connection therewith.


Section 4.15.                         Perfection.


(a)                                  This
Indenture creates a valid and continuing security interest (as defined under
the applicable UCC) in the Collateral in favor of the Trustee, on behalf of the
Secured Parties, which is enforceable against creditors of and purchasers of
the Issuer, as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws, now or hereafter
in effect, and by general principles of equity (whether considered in a suit at
law or in equity).  Upon (i) attachment
and (ii) the filing of financing statements described in Section 5.10 hereof,
the security interest in favor of the Trustee in the Collateral will be prior
to all other Liens (other than Permitted Liens).


(b)                                 Immediately
prior to the pledge of the Collateral, the Issuer owns and has good and
marketable title to the Collateral, free and clear of any Lien, claim or
encumbrance of any Person, other than Permitted Liens; and the Issuer has
caused on or prior to the Closing Date, the filing of all appropriate UCC
financing statements in the 



 31
 









proper filing office in the appropriate
jurisdictions under applicable law in order to perfect the security interest
granted by the Issuer to the Trustee under this Indenture in the Collateral.


Section 4.16.                         ERISA.  No steps have been taken by any Person to
terminate any Benefit Plan the assets of which are not sufficient to satisfy
all of its benefits liabilities (as determined under Title IV of ERISA), no
contribution failure has occurred with respect to any Plan sufficient to give
rise to a lien under Section 302(f) of ERISA and each Plan has been
administered in all material respects in compliance with its terms and
applicable provisions of ERISA and the IRC.


Section 4.17.                         Recordkeeping.  The Issuer, its parents, Subsidiaries, and
Affiliates have kept and maintained proper books and records of account,
including information regarding all Collateral, an annual balance sheet,
statement of revenues, expenses and changes in retained earnings and statement
of cash flows, that show in reasonable detail the financial condition of the
Issuer.


ARTICLE V


AFFIRMATIVE
COVENANTS


From the Effective Date
until the performance in full of the Obligations under the Transaction
Documents, the Issuer hereby covenants and agrees with Initial Owner, the
Trustee, and the Controlling Party:


Section 5.01.                         Payment
of Principal and Interest, etc.  That
it will promptly pay (i) the principal of and interest on every Note issued
under this Indenture, (ii) all Undrawn Amount Fees, and (iii) the Trustee’s
Fees at the place, on the dates and in the manner provided herein, according to
the true intent and meaning thereof.


Section 5.02.                         Performance
of Covenants by
Issuer.  That it shall
faithfully perform, or cause to be performed, at all times any and all
covenants, agreements, undertakings, stipulations and provisions contained in
this Indenture, in any and every Note executed, authenticated and delivered
hereunder, and in all of its proceedings pertaining hereto, and all other
Obligations of the Issuer under this Indenture, and in the material Transaction
Documents, except as set forth in Schedule 5.02.  The Issuer covenants that it is duly
authorized to issue the Notes authorized hereby and to execute this Indenture
and to pledge the amounts hereby pledged in the manner and to the extent herein
set forth.  The Issuer further covenants
that all action on its part for the issuance of the Notes and the execution and
delivery of this Indenture has been duly and effectively taken, and that the
Notes in the hands of the owners thereof are and will be valid and enforceable
general obligations of the Issuer according to the terms thereof and hereof.


Section 5.03.                         Instruments
of Further Assurance.  The Issuer
covenants that it will do, execute, acknowledge and deliver, or cause to be
done, executed, acknowledged and delivered, such indentures supplemental hereto
and such further acts, instruments and transfers as the Trustee may reasonably
require for the better assuring, transferring, pledging, assigning and confirming
to the Trustee all and singular the rights assigned hereby and the Collateral
pledged 



 32
 









hereby to the
payment of the principal of and interest on the Notes and the other Obligations
of the Issuer under this Indenture.


Section 5.04.                         Notice
from Others.  Issuer promptly shall
provide to Trustee any written or electronic notice, or a summary in writing of
any oral notice, received by Issuer, the Guarantors, or a military housing
Subsidiary or Affiliate alleging a termination or a breach of a Project Document
by Issuer, the Guarantors, or their Affiliates and Subsidiaries.


Section 5.05.                         List of
Noteholders.  The Trustee, as
Registrar, shall maintain at its designated corporate trust office a list of
names and addresses of the Owners of all Notes registered on the registration
books of the Issuer maintained by the Trustee as Registrar.  The Trustee and the Issuer shall be
responsible only as to the information provided to them with regard to the
accuracy of such list.


Section 5.06.                         Compliance
with Laws, Etc.


(a)                                  The
Issuer shall do, or cause to be done, all things necessary to preserve, renew
and keep in full force and effect its existence, rights, and material licenses,
permits and franchises, and comply, in all material respects, with all legal
requirements applicable to it, its parents, Subsidiaries, and Affiliates, and
the Collateral, including, but not limited to, the Sarbanes-Oxley Act of 2002
and the rules and regulations promulgated in connection therewith.  The
Issuer shall not commit any act or omission affording the federal government or
any State or local government the right of forfeiture against the Collateral or
any part thereof or any monies paid in performance of Issuer’s obligations
under any of the Transaction Documents.  The Issuer shall use its
commercially reasonable efforts to prevent other Persons from performing any
act or omission affording the federal government or any State or local
government the right of forfeiture against the Collateral or any part thereof
or any monies paid in performance of Issuer’s obligations under any of the
Transaction Documents.  Issuer shall not to commit, and shall use
commercially reasonable efforts not to permit or suffer to exist any act or
omission affording such right of forfeiture. 
Issuer shall operate or cause any Person to operate the Military Housing
Projects in accordance with applicable legal requirements, and within the terms
and provisions of the material Transaction Documents.


(b)                                 After
prior written notice to Initial Owner and the Trustee, Issuer or the
Guarantors, at its own expense, may contest by appropriate legal proceeding
promptly initiated and conducted in good faith and with due diligence, the
validity of any legal requirement, the applicability of any legal requirement
to Issuer, the Guarantors or the Collateral, or any alleged violation of any
legal requirement, provided that (i) no Event of Default has occurred and
remains uncured; (ii) such proceeding shall be permitted under and be conducted
in accordance with the provisions of any instrument to which Issuer or the
Guarantors is subject and shall not constitute a default thereunder and such
proceeding shall be conducted in accordance with all applicable laws; (iii) no
Collateral or any part thereof or interest therein will be in danger of being
sold, forfeited, terminated, cancelled or lost; (iv) Issuer or the Guarantors
shall promptly upon final determination thereof comply with any such legal
requirement determined to be valid or applicable or cure any violation of any
legal requirement; (v) such proceeding shall 



 33
 









suspend the enforcement of the contested
legal requirement against Issuer, the Guarantors or the Collateral; and
(vi) Issuer or the Guarantors shall furnish such security as may be
required in the proceeding, or as may be reasonably requested by Initial Owner
and the Trustee, to insure compliance with such legal requirement, together
with all interest and penalties payable in connection therewith.  Initial
Owner, each Owner and the Trustee may apply any such security or part thereof,
as necessary to cause compliance with such legal requirement at any time when,
in the reasonable judgment of Initial Owner and the Trustee, the validity,
applicability or violation of such Legal Requirement is finally established or
any Collateral (or any part thereof or interest therein) shall be in danger of
being sold, forfeited, terminated, cancelled or lost.


(c)                                  comply
in all material respects with (i) the Issuer’s certificate of formation and
limited partnership agreement and other organizational documents, (ii) any
Requirements of Law applicable to the Issuer, its business and properties, and
(iii) each and all of the Transaction Documents.


Section 5.07.                         Audits.  The Issuer agrees to permit, at its expense,
(a) on an annual basis and (b) following and during the occurrence of an Event
of Default, at any time, in each case, upon reasonable prior notice to the
Issuer and during regular business hours, the Initial Owner and the Trustee or
their respective agents or representatives (1) to examine and make copies of
and abstracts from all records and (2) to visit the offices and properties of
the Issuer, the Guarantors, or their Affiliates or Subsidiaries for the purpose
of examining such records and to discuss matters relating to the Collateral,
the Transaction Documents, or the Military Housing Projects, and the Issuer’s
performance hereunder with any of the officers and employees of the Issuer
having knowledge of such matters.


Section 5.08.                         Location
of Office.  The Issuer covenants to
keep its principal place of business and chief operating office and the office
where records relating to the Collateral are kept at the address of the Issuer
specified in Section 4.09 of this Indenture or, in any such case, upon thirty
(30) days prior written notice to the Initial Owner and the Trustee, at other
locations within the United States.


Section 5.09.                         Preservation
of Existence.  The Issuer covenants
to observe all procedures required by its Certificate of Limited Partnership
and its limited partnership agreement, and to preserve and maintain its limited
partnership existence, rights, franchises, licenses, permits and privileges in
the jurisdiction of its organization, and qualify and remain qualified in good
standing as a foreign limited partnership in each jurisdiction where the
failure to preserve and maintain such rights, franchises, privileges, licenses,
permits and qualifications could reasonably be expected to cause a Material
Adverse Change.


Section 5.10.                         Assignment
of Rights under the Pledge Agreement. 
With respect to the Pledge Agreement, the Account Control and Security
Agreement, and the Irrevocable Payment Instructions, the Issuer covenants to
acquire, among other things, all of the right, title and interest of the
Pledgors in and to the Collateral specified therein and take all necessary
action to perfect and protect the Trustee’s security interest in, to and under
the Pledge Agreement and the Irrevocable Payment Instructions, including, but
not limited to (A) filing and maintaining effective UCC financing statements
against the Issuer and the related Pledgor in all necessary or 



 34
 









appropriate
filing offices, and filing continuation statements, amendments or assignments
with respect thereto in such filing offices, (B) executing or causing to be executed
such other instruments or notices as may be necessary or appropriate and (C)
taking all additional action that the Initial Owner, Controlling Party, or the
Trustee may reasonably request to perfect, protect and more fully evidence the
interests of the Trustee under this Indenture with respect to the Pledge
Agreement, Account Control and Security Agreement, and the Irrevocable Payment
Instructions.


Section 5.11.                         Keeping
of Records and Books of Account.  The
Issuer covenants to maintain and implement, and shall cause GMH to maintain and
implement, as the case may be, administrative and operating procedures
(including, without limitation an ability to recreate accounting records
relating to the Collateral in the event of the destruction of the originals thereof)
and keep and maintain all documents, books, records and other information
reasonably necessary or advisable for the collection of all Collateral, and in
which timely entries are made in accordance with GAAP.


Section 5.12.                         Rights
under Pledge Agreement.  In
connection with the Pledge Agreement, the Account Control and Security
Agreement, and the Irrevocable Payment Instructions relating thereto, the
Issuer covenants to direct, instruct or request any lawful action thereunder,
including, without limitation, in connection with the enforcement of its rights
thereunder, as instructed by the Initial Owner, Controlling Party, or the
Trustee.


Section 5.13.                         Enforcement
of Transaction Documents.  The Issuer
shall (i) enforce any payment instructions made pursuant to this Indenture,
(ii) take any action required or permitted to be taken by it under this
Indenture and the other Transaction Documents to which it is a party as
directed by the Trustee, including, without limitation, making claims to which
it may be entitled under any indemnity reimbursement or similar provision
contained in any payment instruction, or any other Transaction Document; and
(iii) promptly and fully pay or caused to be paid any and all equity
contributions or obligations required by the Project Documents.


Section 5.14.                         Security
Interest.  There are no existing
claims or liens (other than Permitted Liens) against any of the Collateral, and
the Issuer shall not permit any claims or liens against the Collateral while
any of the Notes are Outstanding (other than Permitted Liens).  At its expense, the Issuer shall or shall
cause the Trustee to take all actions necessary or desirable to establish and
maintain a perfected security interest in favor of the Trustee in the
Collateral, free and clear of all Liens (other than Permitted Liens), including
taking such action to perfect, protect or more fully evidence the security
interest of the Trustee.


Section 5.15.                         No
Pledge.  The Issuer shall not sell,
transfer or otherwise pledge its interest in the Collateral without the consent
of the Trustee, and otherwise permitted by this Indenture.


Section 5.16.                         Guaranty
Agreement.  The Issuer shall provide
and maintain a Guaranty Agreement in effect which provides for payment of all
interest and principal on the Notes when due and payable and is signed by GMH,
GMH Military Housing, LLC, GMH Military Housing Investments, LLC, GMH
Communities TRS, Inc., GMH Military Housing 



 35
 









Development,
LLC, GMH Military Housing Construction, LLC, GMH Military Housing Management,
LLC, GMH Northeast Housing Design/Build LLC, GMH/Benham Military Communities
LLC, GMH/Phelps Military Communities LLC, GMH Military Housing - AETC Limited
Partner LLC, GMH Military Housing - Carlisle/Picatinny Limited Partner, GMH
Military Housing - Bliss/WSMR Limited Partner LLC, GMH AETC
Management/Development LLC, and the Trustee. 
If Issuer should fail to deposit or cause to be deposited an amount
sufficient to pay the principal of and interesting owing on the Interest
Payment Date or the Principal Payment Date by 10:00 A.M. Eastern time, the
Trustee shall have the right to demand payment of an amount equal to the
insufficiency from the Guarantors under the Guaranty Agreement, and the
Guarantors shall deposit, or cause to be deposited, to the Revenue Fund, or pay
to the Trustee, the amount of the insufficiency by 10:00 AM Eastern time the
next Business Day.  To the extent the
Trustee shall receive a sufficient amount to pay interest and/or principal that
is due and owing on the Notes from the Issuer or the the Guarantors and such
amount is and such amount immediately is distributed to the Noteholders on such
Interest Payment Date or Principal Payment Date, then there shall be no default
under Section 10.01(a) of this Indenture. 
The Guaranty Agreement shall provide that the Guarantors and GMH shall
not, for the term of the Guaranty Agreement, sell, transfer or otherwise pledge
their respective ownership interests in the Issuer or the Collateral, as the
case may be, without the consent of the Issuer, the Trustee, and the Initial
Owner, and shall contain a representation and warranty of GMH and the
Guarantors to the effect it has not transferred, pledged or otherwise disposed
of, or created or suffered to exist, any lien upon or with respect to all or
any portion of its ownership interest in the Issuer.


Section 5.17.                         Financial
Covenants.


(a)                                  Issuer
shall cause GMH to maintain a Fixed Charges Coverage Ratio of not less than
1.15 to 1.00 (calculated quarterly).


(b)                                 Issuer
shall cause GMH to not permit Consolidated Tangible Net Worth to be less than
$375,000,000.


(c)                                  Issuer
shall cause GMH to maintain a quarterly minimum Adjusted Management EBITDA of
$3,500,000.


All calculations of
financial covenants shall be in accordance with GAAP and shall be certified by
the chief financial officer of GMH and reported quarterly to the Trustee and
the Initial Owner.


Section 5.18.                         Notice of
Certain Events.  Issuer shall
promptly, and in any event within five (5) Business Days, after an Authorized
Officer has knowledge of an Event of Default or Potential Event of Default,
provide written notice to the Trustee and the Initial Owner setting forth
details of the occurrence of an Event of Default or Potential Event of Default,
and the action proposed to be taken with respect thereto.


Section 5.19.                         Reporting
Related to the Collateral.  The
Issuer shall provide, or cause to be provided, to the Trustee and Initial
Owner, as follows:


(a)                                  within
forty-five (45) days of the end of each quarter, the quarterly financial
statements for GMH;



 36
 









(b)                                 on
an annual basis and within ninety (90) days after the end of each fiscal year,
the audited financial statements for GMH;


(c)                                  together
with the financial statements required hereunder, a compliance certificate
signed by an Authorized Officer of the Issuer stating (i) the attached
financial statements have been prepared in accordance with GAAP to the extent
required and accurately reflect the financial condition of the Issuer, GMH, the
Guarantors, and (ii) that no Event of Default or Potential Event of Default
exists, or, if any Event of Default or Potential Event of Default exists,
stating the nature and status thereof; and,


(d)                                 audited
financial statements for the Military Housing Projects which accurately reflect
the financial status of such projects within 120 days after the end of each
fiscal year.


Section 5.20.                         Litigation
and Other Matters.  Issuer promptly
shall provide to the Trustee written notice of (a) any and all pending or
threatened (in writing) litigation involving the Issuer, Guarantor, or their
Affiliates or Subsidiaries, and (b) any other matters or events concerning the
Issuer, the Guarantors, or their Affiliates or Subsidiaries which could
reasonably be expected to cause a Material Adverse Change.


Section 5.21.                         Liens.  Issuer promptly, and in no event more than
three (3) Business Days after an Authorized Officer of the Issuer has knowledge
thereof, shall provide to the Initial Owner and the Trustee written notice of
any Lien on the Collateral or any portion thereof (other than Permitted Liens).


Section 5.22.                         Other
Information.  As soon as reasonably
practicable, from time to time, Issuer shall provide such other information,
documents, records or reports respecting the Collateral or the conditions or
operations, financial or otherwise, related to the Military Housing Projects of
the Issuer, as the Initial Owner or the Trustee may from time to time
reasonably request in order to protect its interests under or as contemplated
by this Indenture and the other Transaction Documents.


Section 5.23.                         Foreign
Assets.  At all times the
Issuer, the Guarantors and their Affiliates and Subsidiaries shall be in
full compliance with all applicable orders, rules, regulations and
recommendations of The Office of Foreign Assets Control of the United States Department
of Treasury.


ARTICLE
VI


NEGATIVE
COVENANTS


Section 6.01.                         Sales,
Liens, Etc. against Collateral.  The
Issuer shall not, and shall cause other Persons to not, without the prior
written consent of the Trustee, sell, assign (by operation of law or otherwise),
transfer, pledge or otherwise dispose of, or create or suffer to exist any Lien
(other than Permitted Liens) upon or with respect to any of the Collateral, or
the Issuer’s, GMH’s, and the Guarantors’ military housing and student housing
businesses.



 37
 









Section 6.02.                         Extension
or Amendment of Revenues.  The Issuer
shall not, without the prior written consent of the Trustee, compromise, extend
or adjust the payment of any Collateral by the Pledgors to the Issuer under the
Pledge Agreement.


Section 6.03.                         Merger,
Consolidation, Etc.  The Issuer shall
not, without the prior written consent of the Trustee, sell any equity interest
to any Person or consolidate with or merge with any other Person or purchase or
otherwise acquire all or substantially all of the assets or capital stock or
other ownership interest of any Person or sell, transfer, lease, assign, pledge
or otherwise encumber or dispose of all or any portion of the Collateral to any
Person; provided, however, the Issuer
shall be permitted to issue additional partnership interest in connection with
(i) the issuance by GMH of its common shares of beneficial interest under its
Equity Incentive Plan or similar equity compensation arrangement, and (ii) the
acquisition of student housing properties in exchange for the contribution of
such properties or the interests therein to the Issuer; and provided further
that in no event may the Issuer issue additional partnership interest to the
extent that it would result in a change of control of the general partner of
the Issuer.


Section 6.04.                         Transaction
Documents.  The Issuer, its parents,
Subsidiaries, or Affiliates shall not, without the prior written consent of the
Trustee, terminate, amend, alter or otherwise modify any Transaction Document
or grant any waiver or consent thereunder, provided, however, the Issuer, its
parents, Subsidiaries, or Affiliates may amend, alter or otherwise modify the
Project Documents solely in compliance with the terms thereof without the
consent of the Trustee unless such amendment, alteration or modification would
result in a Material Adverse Change or a material adverse effect on projections
in the Closing Proforma.  Notwithstanding
the foregoing, the following modifications to Transaction Documents are
permitted:


(a)                                  the
assumption by GMH Military Housing Investments LLC (“Investments”) of the
Equity Guaranty provided by GMH Associates, Inc. and Gary M. Holloway for the
Stewart/Hunter project;


(b)                                 the
assumption by Investments of the Equity Guaranty provided by Gary M. Holloway
in the Fort Hamilton project; and


(c)                                  the
assumption by Investments of the Equity Guaranty provided by GMH Associates,
Inc. and Gary M. Holloway in the Fort Detrick/WRAMC project.


Section 6.05.                         Change in
Name, Jurisdiction of Organization. 
The Issuer shall not, without the prior written consent of the Trustee,
(a) make any change to its name indicated on the public record of the
jurisdiction of organization which shows it to have been organized or (b)
change its jurisdiction of organization without, in the case of clause (a) or
clause (b), having provided the Trustee with thirty (30) days prior written
notice.


Section 6.06.                         Actions
under the Pledge Agreement.  The
Issuer, its parents, Subsidiaries, or Affiliates shall not, without the prior
written consent of the Trustee, cancel, terminate, amend, modify or supplement,
or consent to any cancellation, amendment, modification or supplement to, any
Pledge Agreement, Irrevocable Payment Instruction, or the Account Control and
Security Agreement, or waive any provision thereof, or direct, instruct or 



 38
 









request any
action under the Pledge Agreement, Irrevocable Payment Instructions, or the
Account Control and Security Agreement with respect to the Revenues or
Preferred Return specified therein in contravention of the direction of the
Trustee or waive any provision thereof, or where the permission of the Issuer
is so required, permit any party to any Pledge Agreement, Irrevocable Payment
Instruction, or the Account Control and Security Agreement to take any action
thereunder which would reasonably be likely to cause a Material Adverse Change
or which would violate any term of this Indenture.


Section 6.07.                         ERISA.  From the Effective Date until the Maturity
Date, the Issuer shall not, without the prior written consent of the Trustee,
be a Plan and none of the assets of Issuer or its Affiliates shall constitute
Plan Assets.  Issuer further covenants
and agrees to deliver to the Trustee such certifications or other evidence from
time to time throughout the term of the Loan, as reasonably requested by the
Trustee represents and covenants that (A) Issuer is not and does not maintain
an “employee benefit plan” as defined in Section 3(3) of ERISA, which is
subject to Title I of ERISA, or a “governmental plan” within the meaning of Section
3(32) of ERISA; (B) Issuer is not subject to State statutes regulating
investments and fiduciary obligations with respect to governmental plans; and
(C) one or more of the following circumstances is true:


(a)                                  Equity
interests in Issuer or its Affiliates are publicly offered securities, within
the meaning of 29 C.F.R. §2510.3 101(b)(2);


(b)                                 Less
than twenty-five percent (25%) of each outstanding class of equity interests in
Issuer are held by “benefit plan investors” within the meaning of 29 C.F.R. §2510.3
101(f)(2); or


(c)                                  Issuer
qualifies as an “operating company” or a “real estate operating company” within
the meaning of 29 C.F.R. §2510.3 101(c) or (e).


Section 6.08.                         Affiliate
Transactions.  The Issuer shall not,
and shall cause the Guarantors to not, enter into, or be a party to, any
transaction or agreement with an Affiliate of Issuer related to or affecting
the Collateral or any Project Document, except with the prior written consent
of the Trustee.


Section 6.09.                         Transfers.  The Issuer, its parents, Subsidiaries or
Affiliates shall not, without the prior written consent of the Trustee, sell,
convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with
respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily
or involuntarily, by operation of law or otherwise, and whether or not for
consideration or of record) any Collateral or any part thereof or any legal or
beneficial interest therein.  The Issuer,
its parents, Subsidiaries and Affiliates shall not convey, transfer, assign,
sell, pledge, or encumber any assets that would cause the Issuer after such
action to fail to satisfy on a reasonably projected basis any of the covenants
set forth in Section 5.17.


Section 6.10.                         Limitation
on Distributions.  From and after the
occurrence of an Event of Default, the Issuer shall not make any distributions
of any nature.



 39
 









Section 6.11.                         Limitation
on Indebtedness.  Issuer, GMH,
Affiliates, and Subsidiaries shall not create, incur, assume or suffer to exist
any indebtedness or issue any shares or interests of preferred capital stock,
except:


(a)                                  Indebtedness
of the Issuer and the Guarantors under this Agreement and the other Transaction
Documents;


(b)                                 Indebtedness
of any Guarantor to the Issuer;


(c)                                  Indebtedness
of an entity which becomes an Affiliate or Subsidiary after the date hereof,
provided that (i) such indebtedness existed at the time such entity became an
Affiliate or Subsidiary and was not created in anticipation thereof, and (ii)
immediately after giving effect to the acquisition of such corporation by the
Issuer no Default or Event of Default shall have occurred and be continuing;


(d)                                 Indebtedness
relating to future property acquisitions or refinancing or equity commitments
with respect to the student housing business.


(e)                                  Indebtedness
relating to financings or refinancings relating to Military Housing Projects
that are non-recourse to Issuer or its Affiliates or Subsidiaries and subject
only to customary “bad acts” guarantees provided in connection with such projects;


(f)                                    Indebtedness
existing as of the date hereof relating to the student housing business; and,


(g)                                 Indebtedness
relating to existing equity commitments related to Military Housing Projects
none of which will become payable prior to payment in full of the Obligations.


(h)                                 Indebtedness
to finance the Navy Southeast and Army West Point projects, set forth on
Exhibit C, and any project indebtedness for future military housing
privatization projects; provided, however, such indebtedness is investment grade
(at least rated BBB by Moody’s or Standard & Poor’s) and is non-recourse to
the Issuer or any Guarantor; and,


(i)                                     Indebtedness
in respect of obligations to contribute equity to military housing
privatization project that does not exceed $15,000,000 on an individual basis.


Section 6.12.                         REIT
Status.  The Issuer shall not act or
fail to act, or allow another Person to act or fail to act, such that GMH loses
its status as a REIT.  GMH shall maintain
its federal tax status as a REIT.



 40
 









ARTICLE
VII


REVENUES
AND FUNDS


Section 7.01.                         Source of
Payment of Notes.  All Notes issued
by the Issuer pursuant to this Indenture, together with interest thereon, are
obligations of the Issuer.  The
Collateral is hereby pledged and assigned as security for the payment of the Obligations
of the Issuer under this Indenture, the order and priority expressly authorized
in this Indenture.


Section 7.02.                         Creation
of Funds.  There are hereby created
by the Issuer and ordered established the following special trust funds to be
held by the Trustee:  (a) the Revenue
Fund, (b) the Note Proceeds Fund, and (c) the Cost of Issuance Fund.


Section 7.03.                         The
Revenue Fund.


(a)                                  The
Issuer shall cause to be deposited into the Revenue Fund, which is comprised of
accounts set forth on Exhibit G, all Collateral monies.  Prior to an Event of Default, such Collateral
monies may be used by the Issuer in the normal course of business and to make
principal and interest payments on the Notes.


(b)                                 Upon
an Event of Default, the Trustee shall allocate and distribute the following
amounts from amounts on deposit in the Revenue Fund which represent the
aggregate amount of Collateral monies, and all Guaranty Agreement amounts
received by the Trustee during or in respect of the related Monthly Period, in
the following order of priority:


First, to the Trustee, the Trustee Fees
due and payable to the Trustee on the Interest Payment Date;


Second,
to the holders of the Notes, the Interest Distribution Amount for such Interest
Payment Date;


Third, to the
extent the Interest Payment Date is the Maturity Date, to the holders of the
Notes, an amount equal to the Aggregate Outstanding Principal Balance of the
Notes;


Fourth, to the
extent such Interest Payment Date is a Redemption Date, to the holders of the
Notes which are subject to optional redemption on such Redemption Date, the
Redemption Price;


Fifth, to the Initial Owner, the Undrawn Amount
Fees due and payable to the Initial Owner on the Interest Payment Date; and,


Sixth, to each Person, on a pari passu basis,
in payment of all other Obligations then due and payable by the Issuer to such
Person on such date under this Indenture and any other Transaction Document.



 41
 









(c)                                  The
Trustee shall, immediately upon receipt of the funds deposited in the Note
Proceeds Fund pursuant to the Issuer’s first Drawing, pay such funds, which
shall retire and terminate the Existing Line of Credit, in accordance with the
Closing Statement, and shall transfer any funds in the Note Proceeds Fund from
the Issuer’s first Drawing in excess of the funds necessary to retire and
terminate the Existing Line of Credit to the Costs of Issuance Fund.


Section 7.04.                         The Note
Proceeds Fund.


(a)                                  The
gross proceeds from the sale of any Notes shall be deposited by the Trustee,
upon receipt from the Initial Owner, in the Note Proceeds Fund.


(b)                                 Upon
the Delivery of Notes, unless instructed in writing otherwise by the Issuer,
the Trustee shall transfer an amount equal to the remaining principal balance
of the Note Proceeds Fund to the Issuer.


(c)                                  To
the extent not distributed to the Issuer pursuant to Section 7.04(b) above with
respect to the initial Notes, all gross proceeds from the sale of Notes shall
be invested by the Trustee in Investment Obligations, as specified in writing,
by the Issuer to the Trustee.  Each such
Investment Obligation shall mature not later than the Business Day preceding
the next Interest Payment Date and shall be held to maturity.  Each investment instruction by the Issuer,
which may be a standing instruction, shall designate specific types of Investment
Obligations that will mature at the time specified in the preceding
sentence.  The Trustee shall not be
liable for any loss incurred in connection with an investment in the Note
Proceeds Fund, except for losses in respect of investments issued or guaranteed
by the Trustee or caused by the gross negligence or willful misconduct of the
Trustee.  All investments of funds in the
Note Proceeds Fund shall be made in the name of the Trustee, on behalf of the
Secured Parties.  All investment earnings
(net of losses) shall be credited to the Note Proceeds Fund.


(d)                                 On
the next Interest Payment Date, all investment earnings (net of losses) and the
interest amount of any sale proceeds shall be transferred by the Trustee to the
Revenue Fund and shall be immediately used to pay interest on the Notes on such
Interest Payment Date.


Section 7.05.                         The Cost
of Issuance Fund.  The Trustee shall,
immediately after the Issuer’s first Drawing, pay all funds in the Cost of
Issuance Fund in accordance with the Closing Statement.


Section 7.06.                         Reserved.


Section 7.07.                         Reserved.


Section 7.08.                         Monthly Statements.  Not later than 2:00 p.m. (New York City
time), on the second LIBOR Determination Date and each LIBOR Determination Date
thereafter, the Trustee shall deliver to the Issuer and the Initial Owner a
statement containing the information for the applicable Interest Payment Date
and related Monthly Period (each, a “Monthly Statement”) as set forth below:



 42
 









(a)                                  the
aggregate amount of Revenues and Preferred Returns received by the Trustee
during the applicable Monthly Period;


(b)                                 the
Aggregate Outstanding Principal Amount of the Notes as reported in the prior
Monthly Statement;


(c)                                  the
outstanding principal amount of any Notes that were redeemed during the
applicable Monthly Period;


(d)                                 (i)
to the extent the Interest Payment Date is the Maturity Date, the Aggregate
Outstanding Amount of the Notes and (ii) to the extent the Interest Payment
Date is a Redemption Date, the portion of the Redemption allocable to principal
of the Notes, on the applicable Interest Payment Date;


(e)                                  the
Note Rate for the applicable Interest Payment Date;


(f)                                    the
Interest Distribution Amount for the applicable Interest Payment Date;


(g)                                 the
Trustee Fees for the applicable Interest Payment Date;


(h)                                 the
aggregate amount of expenses paid by the Trustee on the applicable Interest
Payment Date pursuant to Section 7.03(b), clause Fifth, of the Indenture and,
with respect to such expenses, the identity of the Person to whom expenses were
paid, the amount of the expenses and a detail setting for the expenses;


(i)                                     the
Undrawn Amount Fees for the applicable Interest Payment Date;


(j)                                     whether
an Event of Default has occurred and is continuing on the applicable Interest
Payment Date; and


(k)                                  the
Aggregate Outstanding Principal Amount, after taking into account the
distribution of the portion of the Redemption Price allocated to the principal
of the Notes to the extent the Interest Payment Date is a Redemption Date, on
the applicable Interest Payment Date relating to the Monthly Period.


Section 7.09.                         Nonpresentment
of Notes.  In the event any Note
shall not be presented for payment when the principal thereof becomes due,
either at maturity or at the date fixed for redemption thereof, or otherwise,
if funds sufficient to pay such Note, including interest accrued thereon to the
date of maturity or redemption, shall have been made available to the Trustee
for the benefit of the owner thereof, all liability of the Issuer to the owner
thereof for the payment of such Note shall forthwith cease, terminate and be
completely discharged, and thereupon it shall be the duty of the Trustee to
hold such funds, without liability for interest thereon, for the benefit of the
owner of such Note, who shall thereafter be restricted exclusively to such
funds, for any claim of whatever nature on his part under this Indenture or on,
or with respect to, such Note for a maximum of two years from the date that
such Note matures, at which point all liability of the Issuer, the Trustee and
any Paying Agent to the owner of such non-presented Note with respect to such
monies shall cease, and on the second anniversary of the date upon which such
monies shall have become due, such monies to the extent permitted by applicable
law shall be 



 43
 









transferred to
the Issuer, at which point all liability of the Trustee to the owner of such
Notes, with respect to monies so transferred to the Issuer, shall terminate.


Section 7.10.                         Money to
be Held in Trust.  All money required
to be deposited with or paid to the Trustee for account of any fund or account
established under any provision of this Indenture shall be held by the Trustee
in trust, and, except for money deposited with or paid to the Trustee for the
redemption of Notes, notice of the redemption of which has been duly given, and
monies held in the Cost of Issuance Fund, shall, while held by the Trustee,
constitute part of the Collateral and be subject to the security interest
created hereby.


Section 7.11.                         Amounts
Remaining in Funds.  After full
payment (or provision for payment) of the Notes and the discharge of the
Indenture, payment of the expenses of the Initial Owner and the payment of the
Trustee Fees (including the fees and expenses of counsel to the Trustee), and
the charges, expenses of the Trustee and any Paying Agent, and all other
amounts required to be paid hereunder, all amounts thereafter remaining in any
fund shall be paid to the Issuer.


ARTICLE
VIII


INVESTMENT
OF MONEY


Amounts on deposit in the
Note Proceeds Fund and the Revenue Fund shall be invested by the Trustee in
Governmental Obligations maturing (or redeemable by the Trustee at a price no
less than their purchase price plus accrued interest) on or prior to the
immediately succeeding Interest Payment Date, or in such other Investment
Obligations as may be directed in writing by the Issuer, the Initial Owner and
the Controlling Party.  When purchasing
such Governmental Obligations, the Trustee shall follow the provisions of
Section 11.03 of this Indenture.  All
such investments and the proceeds thereof shall be credited and applied in
accordance with Article VIII hereof.


All such investments
shall at all times be attributable to the fund from whence the money used to
acquire such investments shall have come, and all income and profits on such investments
shall be first used to offset any investment losses (including losses resulting
from the sale of investments) in such fund. 
The Trustee shall sell at the best price reasonably obtainable under the
circumstances and reduce to cash a sufficient amount of such investments in the
respective fund whenever the cash balance therein is insufficient to pay the
amounts then required to be paid therefrom. 
The Trustee shall not be liable or responsible for any loss, fee, tax or
other charge resulting from any such investment, reinvestment or liquidation of
an investment made in accordance with this Article VIII except for losses in
respect of investments issued or guaranteed by the Trustee or caused by the
Trustee’s gross negligence or willful misconduct.


The Issuer may, at any
time, give to the Trustee written directions respecting the investment of any
monies in the Cost of Issuance Fund or otherwise required to be invested by the
Trustee under this Indenture, subject, however, to the provisions of this Article,
and the Trustee shall then invest such monies in Investment Obligations as so
directed by the Issuer.  The Trustee
shall not be responsible for determining if any such directed investments are
legal investments under the laws of the State, nor shall the Trustee be
responsible or liable for any loss 



 44
 









suffered in
connection with any investment of funds made by it in accordance with this
Indenture, nor shall it be responsible for paying interest on any funds held by
it hereunder for which it has received no written investment instructions.


In computing the amount
in any fund created under the provisions of this Indenture for any purpose
provided herein, obligations purchased as an investment of monies therein shall
initially be valued at the market value thereof with any premium or discount
amortized over the period of time remaining until the maturity of such
obligations, exclusive of accrued interest other than accrued interest paid in
connection with the purchase of any such obligations and not yet recovered.  All subsequent valuations shall be performed
on the same basis as the initial valuation. 
Any profit realized from the liquidation of such investments shall be
credited to such fund and any loss resulting from the liquidation of such
investments shall be charged to the respective fund.


Investments may be
purchased by the Trustee through its own investment division or Affiliate.


ARTICLE
IX


DISCHARGE
OF INDENTURE; DEFEASANCE OF NOTES


If the Issuer shall pay
or cause to be paid, or there shall be otherwise paid or provision for payment
made, to or for the owners of the Notes the principal of and interest due or to
become due thereon at the times and in the manner stipulated therein, and shall
pay or cause to be paid to the Trustee all sums of money due or to become due
according to the provisions hereof (including the Trustee Fees and expenses in
connection therewith) and the Initial Owner all sums of money due or to become
due according to the provision herein, then this Indenture and all rights hereby
granted shall cease, determine and be void, whereupon the Trustee shall cancel
and discharge the lien of this Indenture, and execute and deliver to the Issuer
such instruments in writing provided by the Issuer as determined by the Issuer
to be requisite to cancel and discharge the lien hereof, and release, assign
and deliver to the Issuer any and all the estate, right, title and interest
herein, or otherwise subject to the lien of this Indenture, except money or
securities held by the Trustee for the payment of the principal of and interest
on the Notes and other Obligations of the Issuer.


Any Note shall be deemed
to be paid within the meaning of this Indenture when payment of the principal
of such Note plus interest thereon to the due date thereof (whether such due
date be by reason of maturity or upon redemption as provided in this Indenture,
or otherwise), either (a) shall have been made or caused to have been made in
accordance with the terms thereof, or (b) shall have been provided for by
irrevocably depositing with the Trustee, in trust and irrevocably setting aside
exclusively for such payment (1) monies which, in the opinion of counsel, would
not constitute a voidable preference under federal bankruptcy law, in an amount
sufficient (as determined by an independent certified public accounting firm)
to make such payment or (2) Defeasance Obligations, maturing as to principal
and interest in such amount and at such times as will insure the availability
of sufficient monies to make such payment, and all necessary and proper fees,
compensation and expenses of the Trustee, the Initial Owner, if any, or the
Issuer pertaining to the Notes with respect to which such deposit is made shall
have been 



 45
 









paid or the
payment thereof provided for to the satisfaction of the Trustee and the
Controlling Party.  At such times as a
Note shall be deemed to be paid hereunder, as aforesaid, it shall no longer be
secured by or entitled to the benefits of this Indenture, except for the purposes
of any such payment from such monies or Defeasance Obligations.


Notwithstanding the
foregoing, in the case of Notes which by their terms may be redeemed prior to
their stated maturity, no deposit under the immediately preceding paragraph
shall be deemed a payment of such Notes as aforesaid until the Issuer shall
have given the Trustee Irrevocable Payment Instructions:


(a)                                  stating
the date when the principal of each such Note is to be paid, whether at
maturity or on a redemption date (which shall be any redemption date permitted
by this Indenture); provided, however, that the Issuer may elect to retain its
rights to redeem Notes on any earlier date authorized hereunder;


(b)                                 requiring
the Trustee to call for redemption pursuant to this Indenture any Notes to be
redeemed prior to maturity pursuant to (a) hereof; and


(c)                                  requiring
the Trustee to mail, as soon as practicable, in the manner prescribed by
Article III hereof, a notice to the owners of such Notes that the deposit
required by clause (b) above has been made with the Trustee and that such Notes
are deemed to have been paid in accordance with this Article and stating the
maturity or redemption date upon which money is to be available for the payment
of the principal or redemption price, if applicable, on such Notes as specified
in (a) hereof.  In addition, if the
Issuer shall have so elected, such notice shall state that the Issuer has
retained the right to redeem Notes, if any, on any earlier redemption date
authorized hereunder.  In giving such
notice, with respect to the deposit required in clause (b) above, the Trustee
shall be entitled to rely on an independent certified public accountant’s
report as to the sufficiency of such deposit to discharge the lien of this
Indenture.


All income from
investment of funds deposited as provided in this Article which is not required
for the payment of the Notes and interest thereon and the Fees and expenses of
the Trustee and the Initial Owner, if any, with respect to which such money
shall have been so deposited, shall be credited to the Revenue Fund as and when
realized and collected on any Interest Payment Date and then transferred by the
Trustee to the Revenue Fund and used to pay interest on the Notes on such
Interest Payment Date or, if the Notes have been paid in full or provision has
been made for paying all amounts due with respect thereto, such extra
investment earnings remaining shall be transferred to the Issuer to be used for
any lawful purpose; provided that prior to making any withdrawals of monies
held under this Indenture after defeasance of the Notes, the Issuer shall
provide to the Trustee and the Controlling Party a report of an independent
certified public accounting firm demonstrating the amounts remaining after such
withdrawals, together with the investment earnings thereon, will be sufficient
to pay all amounts due thereafter with respect to the Notes and all other
Obligations of the Issuer when due under this Indenture.


Anything in Article XIV
hereof to the contrary notwithstanding, if money or Defeasance Obligations have
been deposited or set aside with the Trustee pursuant to this Article for the 



 46
 









payment of Notes and such Notes shall not have in fact
been actually paid in full, no amendment to the provisions of this Article
shall be made without the consent of the owner of each Note affected thereby.


ARTICLE X


EVENT OF
DEFAULT PROVISIONS AND REMEDIES


Section 10.01.                  Events of
Default.  The term “Event of Default,”
whenever used in this Indenture, means any of the following events:


(a)                                  Default
by the Issuer in the due and punctual payment of accrued and unpaid interest on
the Notes on any Interest Payment Date or principal of the Notes on the
Maturity Date, which payment default remains uncured for a period of one (1)
day following the Interest Payment Date;


(b)                                 (i)
The Issuer shall cease or otherwise fail to have good and valid title to any of
the Collateral and such failure remains uncured for a period of five (5) days
following the date upon which the Issuer ceased or otherwise failed to have
good and valid title to the applicable Collateral or (ii) the Secured Parties
shall, for any reason cease to have a valid and perfected first priority
security interest in the Collateral and a valid and perfected first priority
security interest in the Collateral, in favor of the Secured Parties, is not
restored within a period of five (5) days following the date upon the Secured
Parties ceased to have a valid and perfected first priority security interest
in the Collateral;


(c)                                  (i)
The Notes, this Indenture, and any material Transaction Documents shall have
ceased to be valid, binding and enforceable as against any of the parties
thereto, without any amendment, modification, waiver or termination of any
terms or conditions thereof, other than has been agreed to in writing by the
Trustee or (ii) the assignment of all of the Issuer’s right, title and interest
in, to and under any of the Pledge Agreement, or the Irrevocable Payment
Instructions, shall have ceased, for any reason, to be fully effective and
enforceable by the Controlling Party as against any of the parties thereto;


(d)                                 GMH
or the Guarantors has defaulted in the performance of its obligations under the
Guaranty Agreement;


(e)                                  the
dissolution or liquidation of the Issuer, GMH, or the Guarantors or the
voluntary initiation by the Issuer, GMH, or the Guarantors of any proceedings
under any federal or state law relating to bankruptcy, insolvency, arrangement,
reorganization, readjustment of debt or any other form of debtor relief, or the
initiation against the Issuer, GMH, or the Guarantors of any such proceedings
which shall remain undismissed for ninety (90) days, or failure by the Issuer,
GMH, or the Guarantors to promptly have discharged any execution, garnishment
or attachment of such consequence as would materially impair the ability of the
Issuer, GMH, or the Guarantors to carry on its operations, or assignment by the
Issuer or the Guarantors for the benefit of its creditors, 



 47
 









or the entry by the Issuer, GMH, or the
Guarantors into any agreement of composition with its creditors or the failure
generally by the Issuer, GMH, or the Guarantors to pay its debts as they become
due;


(f)                                    GMH
loses its status as a REIT;


(g)                                 if
any event or circumstance exists or have occurred (other than the event of
circumstances described in clauses (a) through (f) above), which is a
violation, default, or breach of any term, representation, warranty, covenant,
or agreement hereunder or under any other material Transaction Document, except
as set forth on Schedule 5.02, and such violation, default or breach is not
fully cured by the Issuer, GMH, or the Guarantors, as the case may be, (i)
within the specified notice or cure period, if any, provided in this Indenture
or such Transaction Document or (ii) if this Indenture or such Transaction
Document does not provide for a grace, notice or cure period, within twenty
(20) days after the Trustee or the Initial Owner gives notice to the Issuer in
the case of any violation, default or breach that can be cured by the payment
of a sum of money or (iii) within thirty (30) days after the Trustee or the
Initial Owner gives notice to the Issuer of any other violation, default or
breach, then the same shall be an Event of Default hereunder; provided,
however, in the case of a violation, default or breach referred to in clause
(iii) is capable of cure but cannot be reasonably cured within such thirty (30)
day period, and provided the Issuer shall have commenced to cure such failure
within such thirty (30) day period and thereafter diligently and expeditiously
proceeds to cure the same, such thirty (30) day period shall be extended for so
long as it shall require the Issuer in the exercise of due diligence to cure
such failure, but in no event shall such cure period extend beyond ninety (90)
days following notice from the Trustee;


(h)                                 any
material adverse change in the material Transaction Documents, except as set
forth in Section 6.04, without the consent of the Trustee.


(i)                                     any
material default on other debt of the Issuer, GMH, the Guarantors, or their
Affiliates and Subsidiaries;


(j)                                     entry
of judgment of over $2,000,000 against the Issuer, GMH, the Guarantors, or
their Affiliates and Subsidiaries, which is not paid or bonded over within
sixty (60) days of its entry;


(k)                                  any
assignment for the benefit of the Issuer’s, GMH’s, Guarantors’, or their
Affiliates’ and Subsidiaries’ creditors, without the written consent of the
Initial Owner, Trustee, and Controlling Party;


(l)                                     any
Material Adverse Change; provided, however, if such Material Adverse Change
results from an event or circumstance set for in (a) through (k) above, no
Event of Default shall exist until the expiration of any cure period set forth
in Section 10.01(g), if applicable, for such default.


(m)                               the
debarment of the Issuer, GMH, the Guarantors, or their Affiliates and Subsidiaries;
or



 48
 









(n)                                 fraud,
theft, embezzlement, misappropriation of funds, gross negligence, breach of
fiduciary duty, or willful or wanton misconduct of the Issuer, GMH,
Subsidiaries, or Affiliates.


Section 10.02.                  Remedies; Rights
of Noteholders.  Upon the occurrence
of any Event of Default, the Trustee may pursue any available remedy at law or
in equity to enforce the payment of the principal of and interest on the Notes
then Outstanding.  With respect to all
Events of Default, the Trustee may accelerate the principal of and interest on
the Notes on any day, and, should the Trustee accelerate the principal and
interest on the Notes, the Issuer shall no longer issue Notes pursuant to this
Indenture.


If an Event of Default
shall have occurred, the Trustee may, and if requested to do so by the owners
of not less than 50% in aggregate principal amount of all the Outstanding
Notes, subject to the Trustee’s right to require satisfactory indemnification
pursuant to Section 12.01(l), shall
be obligated to exercise one or more of the rights and powers conferred by this
Section, as the Trustee, being advised by counsel, shall deem most expedient in
the interest of the applicable Noteholders.


No remedy by the terms of
this Indenture conferred upon or reserved to the Trustee or to the Noteholders
is intended to be exclusive of any other remedy, but each and every such remedy
shall be cumulative and shall be in addition to any other remedy given to the
Trustee or to the Noteholders hereunder or now or hereafter existing at law or
in equity or by statute.


No delay or omission to
exercise any right or power accruing upon any Event of Default shall impair any
such right or power or shall be construed to be a waiver of any such Event of
Default or acquiescence thereof; and every such right and power may be
exercised from time to time as often as may be deemed expedient.


No waiver of any Event of
Default hereunder, whether by the Trustee or by the Noteholders, shall extend
to or shall affect any subsequent default or Event of Default or shall impair
any rights or remedies consequent thereon.


Section 10.03.                  Right of
Noteholders to Direct Proceedings. 
The owners of not less than 50% in aggregate principal amount of all
Notes Outstanding shall have the right, at any time, subject to the provisions
of Section 12.01(l) hereof, by an instrument or instruments in writing executed
and delivered to the Trustee, to direct the method and place of conducting all
proceedings to be taken by the Trustee in connection with the enforcement of the
terms and conditions of this Indenture, or for the appointment of a receiver or
any other proceedings hereunder.


Section 10.04.                  Application of
Money.  The Issuer covenants that if
an Event of Default has occurred, upon demand of the Trustee, the Issuer shall
promptly pay or cause to be paid to the Trustee, after receipt thereof, all
Collateral monies.  The Trustee shall
deposit all such monies into the Revenue Fund. 
All other monies received by the Trustee pursuant to any right given or
action taken under the Transaction Documents shall, after payment of the costs
and expenses of the proceedings resulting in the collection of such money
(including attorneys’ fees and expenses), liabilities and advances incurred or
made by the Trustee, be deposited in the Revenue 



 49
 









Fund.During the continuance of an Event of
Default for which all Outstanding Obligations shall not have become nor have
been declared due and payable, notwithstanding any other provision of this
Indenture, the Trustee shall apply, or cause the Paying Agent to apply, all
monies held in the Revenue Fund and any other Fund to pay the fees and expenses
of the Trustee and then  as follows and
in the following order:


(a)                                  Unless
the principal of all the Notes shall have become due and payable, all such monies
shall be applied:


First, to the payment to the Persons
entitled thereto of all interest then due on the Notes, and, if the amount
available shall not be sufficient to pay in full such amount, then to the
payment ratably, according to the amounts due to the Persons entitled thereto,
without any discrimination or privilege;


Second,
to the payment to the Persons entitled thereto as the same shall become due of
the unpaid principal of the Notes which shall have become due, in the order of
their due dates, with interest on such Notes from the respective dates upon
which they became due at the rate borne by such Notes and, if the amount
available shall not be sufficient to pay in full Notes due on any particular
date, together with such interest, then to the payment ratably, according to
the amount of principal due on such date, to the Persons entitled thereto
without any discrimination or privilege;


Third,
to the payment to the Persons entitled thereto as the same shall become due of
Notes matured or called for redemption prior to maturity in the order of their
due or call dates, with interest on such Notes from the respective dates upon
which they became due at the rate borne by such Notes and, if the amount
available shall not be sufficient to pay in full Notes due on any particular
date, together with such interest, then to the payment ratably, according to
the amount of principal due on such date, to the Persons entitled thereto
without any discrimination or privilege; and,


Fourth,
to be held for the payment to the Persons entitled thereto as the same shall
become due of the principal of and interest on the Notes which may thereafter
become due, either at maturity or upon call for redemption prior to maturity
and, if the amount available shall not be sufficient to pay in full Notes due
on any particular date, together with interest then due and owing thereon,
payment shall be made ratably according to the amount of principal due on such
date to the Persons entitled thereto without any discrimination or privilege.


(b)                                 If
the principal of all the Notes shall have become due, all such monies shall be
applied to the payment of the principal and interest then due and unpaid upon
such Notes, without preference or priority of principal over interest or of
interest over principal, or of any installment of interest over any other
installment of interest, or of any Note over any other Note, ratably, according
to the amounts due respectively for principal and interest, as applicable, to
the persons entitled thereto without any discrimination or privilege.



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Whenever money is to be
applied pursuant to the provisions of this Section, such money shall be applied
at such times, and from time to time, as the Trustee shall determine, having
due regard to the amount of such money available for application and the
likelihood of additional money becoming available for such application in the
future.  Whenever the Trustee shall apply
such funds, it shall fix the date (which shall be an Interest Payment Date
unless it shall deem another date more suitable) upon which such application is
to be made, and upon such date, interest on the amounts of principal to be paid
on such dates shall cease to accrue.  The
Trustee shall give such notice as it may deem appropriate of the deposit with
it of any such money and of the fixing of any such date and shall not be
required to make payment to the owner of any Note until such Note shall be
presented to the Trustee for appropriate endorsement or for cancellation if
fully paid.


Whenever all principal of
and interest on all Notes have been paid under the provisions of this Section
and expenses and charges of the Initial Owner, all Trustee Fees and expenses
and charges of the Trustee and any Paying Agent and any other Obligations have
been paid, any balance remaining in any fund hereunder shall be paid to the
Issuer as provided in Article VII hereof or as a court of competent
jurisdiction may direct.


Section 10.05.                  Remedies Vested
in the Trustee.  All rights of action
(including the right to file proof of claims) under this Indenture or under any
of the Notes may be enforced by the Trustee without the possession of any of
the Notes or the production thereof in any trial or other proceeding related
thereto, and any such suit or proceeding instituted by the Trustee shall be
brought in its name as the Trustee without the necessity of joining as
plaintiffs or defendants any owner of the Notes, and any recovery of judgment
shall be for the equal and ratable benefit of the owners of the Outstanding
Notes.


Section 10.06.                  Rights and
Remedies of Noteholders.  No owner of
any Note shall have any right to institute any suit, action or proceeding at
law or in equity for the enforcement of this Indenture or for the execution of
any trust hereof or for the appointment of a receiver or any other remedy
hereunder, unless (a) a default has occurred with respect to the Notes of which
the Trustee has been notified as provided in Section 12.01(h) hereof, or of
which by such subsection it is deemed to have notice, (b) such default shall
have become an Event of Default and the owners of not less than 50% in
aggregate principal amount of Notes then Outstanding shall have furnished
written notice to the Trustee and shall have offered the Trustee reasonable
opportunity either to proceed to exercise the powers hereinbefore granted or to
institute such action, suit or proceeding in their own name or names, (c) the
Trustee shall have been indemnified as provided in Section 12.01(l) hereof, and
(d) the Trustee shall thereafter fail or refuse to exercise the powers
hereinbefore granted, or to institute such action, suit or proceeding in its
own name, as Trustee, for a period of sixty (60) days after receipt by it of
such request and offer of indemnity; and such notification, request and offer
of indemnity are hereby declared in every case at the option of the Trustee to
be conditions precedent to the execution of the powers and trust of this
Indenture, and to any action or cause of action for the enforcement of this
Indenture, or for the appointment of a receiver or for any other remedy
hereunder; it being understood and intended that no one or more owners of the
Notes shall have any right in any manner whatsoever to affect, disturb or
prejudice the lien of this Indenture by its, his or their action or to enforce
any right hereunder except by action of the Owners of at least 25% of the
aggregate principal amount of all Notes Outstanding, in the manner herein
provided, and that all 



 51
 









proceedings at
law or in equity shall be instituted, had and maintained in the manner herein
provided and for the equal and ratable benefit of the owners of all Notes then
Outstanding.  However, nothing contained
in this Indenture shall affect or impair the right of any Noteholder to enforce
the payment of the principal of and interest on any Note at and after the
maturity thereof or the obligation of the Issuer to pay the principal of and
interest on each of the Notes issued hereunder to the respective owners thereof
at the time, place, from the source and in the manner in the Notes expressed.


Section 10.07.                  Termination of
Proceedings.  In case the Trustee
shall have proceeded to enforce any right under this Indenture by the
appointment of a receiver or otherwise, and such proceedings shall have been
discontinued or abandoned for any reason, or shall have been determined
adversely, then and in every such case the Issuer, the Trustee and the
Noteholders shall be restored to their former position and rights hereunder,
respectively, with regard to the property herein subject to this Indenture, and
all rights, remedies and powers of the Trustee shall continue as if no such
proceedings had been taken.


Section 10.08.                  Waivers of
Events of Default.  The Trustee may
waive any Event of Default hereunder and its consequences and, subject to the
Trustee’s right to require satisfactory indemnification pursuant to Section
12.01(l), shall do so upon the written request of the owners of (a) more than
50% in aggregate principal amount of the Notes then Outstanding in respect of
which default in the payment of principal or interest, or both, exists, or (b)
more than 50% in aggregate principal amount of all Notes then Outstanding in
the case of any other Event of Default; provided, however, that there shall not
be waived any Event of Default in the payment of the principal of any
Outstanding Notes at the date of maturity specified therein or any Event of
Default in the payment when due of the interest on any such Notes unless, prior
to such waiver or rescission, all arrears of interest or all arrears of
payments of principal when due, with interest on overdue principal at the rate
borne by the Notes, and all expenses of the Trustee and the Initial Owner in
connection with such Event of Default, shall have been paid or provided for.  In case of any such waiver or rescission, or
in case any proceedings taken by the Trustee on account of any such Event of
Default shall have been discontinued or abandoned or determined adversely, then
and in every such case the Issuer, the Trustee, the Initial Owner and the
Noteholders shall be restored to their former positions and rights hereunder,
respectively, but no such waiver or rescission shall extend to any subsequent
or other default, or impair any right consequent thereon.


Section 10.09.                  Notice of Defaults.  The Trustee shall be presumed to have notice
only of payment defaults under Section 10.01(a) hereof.  The Trustee shall be deemed to have notice of
any other default only in accordance with the provisions of Section 12.01(h)
hereof.  Anything herein to the contrary
notwithstanding, no default under Section 10.01(b) hereof shall constitute an
Event of Default until actual notice of such default by first-class mail
(postage prepaid) shall be given to the Issuer and the Initial Owner (such
notice to be given no later than thirty (30) days after the occurrence of such
default) by the Trustee or by the owners of not less than 25% in aggregate
principal amount of all Notes Outstanding and the Issuer shall have had thirty
(30) days after receipt of such notice to correct such default or cause such
default to be corrected, and shall not have corrected such default or caused
such default to be corrected within the applicable period; provided, however,
if the default is such that it cannot be corrected within the applicable 



 52
 









period, it
shall not constitute an Event of Default if corrective action is instituted by
the Issuer within the applicable period and diligently pursued until the
default is corrected.


The Trustee shall, within
thirty (30) days after the occurrence of any Event of Default hereunder (within
thirty (30) days of its knowledge, as provided in Section 12.01(h) hereof, of
an event which, with the passage of time, would become an Event of Default
pursuant to Section 10.01(b) hereof), give written notice thereof by
first-class mail, to the Issuer, the Initial Owner and the owners of all Notes
then Outstanding as shown by the list of Note holders required to be maintained
pursuant to Section 2.08 hereof.


ARTICLE
XI


DELIVERY
OF COLLATERAL


Section 11.01.                  Continuing
Liability of the Issuer.  The
security interests described in GRANTING CLAUSE of this Indenture are granted
as security only and shall not subject the Trustee or any of its assigns to, or
transfer or in any way affect or modify, any obligation, liability or indemnity
of the Issuer with respect to, any of the Collateral or any transaction
relating thereto.


Section 11.02.                  UCC Matters.


(a)                                  The
Issuer, at its expense, shall or shall cause the Trustee to file, at all times
on and after the date hereof, UCC financing statements and continuation
statements in the appropriate jurisdictions as required to continue the
perfection of the security interests created by this Indenture.  The Issuer shall from time to time, at its
expense and in such manner and form as the Trustee, the Controlling Party or
any of their respective successors or permitted assigns may reasonably request,
prepare, execute, deliver, file and record any other statement, continuation
statement, specific assignment or any other instrument or document and take any
other action that may be necessary or reasonably desirable to create, evidence,
preserve, perfect or validate the security interests created hereunder or
enable the Trustee to exercise and enforce its rights hereunder with respect to
any of the Collateral.


(b)                                 If
the Issuer fails to perform any of its agreements and obligations under this
Article XI, the Trustee shall perform or cause the performance of, such
agreement or obligation, and the reasonable expenses of the Trustee incurred in
connection therewith shall be payable by the Trustee upon the Trustee’s demand
therefor.  For the purpose of enabling
the Trustee to exercise its rights described in this Article XI, the Issuer
hereby authorizes the Trustee, to take any and all steps in the Issuer’s,
Gurantor’s, and their Affiliates or Subsidiaries’ name and on behalf of the
Issuer necessary or desirable, in the reasonable determination of the Trustee
or the Controlling Party to collect all Revenues and Preferred Returns
including, without limitation, endorsing the Issuer’s Gurantor’s, and their
Affiliates or Subsidiaries’ name on checks and other instruments representing
the Revenues and Preferred Returns and enforcing the Issuer’s Gurantor’s, and
their Affiliates or Subsidiaries’ right to receive such Revenues and Preferred
Returns.



 53















(c)           The
Issuer hereby acknowledges that all of its right, title and interest in, to and
under the Pledge Agreement, the Account Control and Security Agreement, and the
Irrevocable Payment Instructions, constitute a part of the Collateral and that
the Trustee shall have the sole right (as between the Issuer and the Owners of
the Notes) to enforce the Issuer’s rights and remedies under the Pledge
Agreement, the Account Control and Security Agreement, and the Irrevocable
Payment Instructions, to receive all amounts, including any Revenues, payable
to the Issuer thereunder, or in connection therewith, to consent to all
amendments, modifications or waivers thereof, and to direct, instruct or
request any action thereunder, but in each case without any obligation on the
part of the Trustee to perform any of the obligations of the Issuer
thereunder.  The Trustee shall have the
exclusive right to direct enforcement by the Issuer of its rights and remedies
under the Pledge Agreement, the Account Control and Security Agreement, and the
Irrevocable Payment Instructions.


(d)           The
Issuer hereby confirms and agrees that the Trustee shall have, during the
continuation of an Event of Default, the sole right to enforce the Issuer’s
rights and remedies under the Pledge Agreement, the Account Control and
Security Agreement, and the Irrevocable Payment Instructions, (but without any
obligation on the part of the Trustee to perform any of the obligations of the
Issuer, under the Pledge Agreement, the Account Control and Security Agreement,
and the Irrevocable Payment Instructions). 
The Issuer further confirms and agrees that such right, power and
authority shall terminate upon the Issuer’s satisfaction of the Obligations;
provided, however, the rights of the Issuer pursuant to such assignment with
respect to the rights and remedies in connection with any indemnity and any
breach of any representation, warranty or covenant made by the Pledgor under
the Pledge Agreement, the Account Control and Security Agreement, and the
Irrevocable Payment Instructions, relating thereto, which rights and remedies
survive the termination of the Pledge Agreement, the Account Control and
Security Agreement, and the Irrevocable Payment Instructions, shall be
continuing and survive any termination of such assignment.  During the continuation of an Event of
Default, the Issuer authorizes the Trustee and gives the Trustee its
irrevocable power of attorney (which authorization is coupled with an
interest), in the name of the Issuer or otherwise, to execute, deliver, file
and record any UCC financing statements, continuation statements and to take
any other action necessary or appropriate under the UCC to further perfect the
security interest created thereby.


Section 11.03.      Delivery of Collateral.


(a)           With
respect to certain Collateral, the Issuer and the Trustee hereby agree that:


(i)            Any
Collateral that is Physical Property shall be delivered to the Initial Owner,
each Owner and the Trustee in accordance with paragraph (a) of the definition
of “Delivery” and shall be held, pending maturity or disposition, solely by the
Trustee or held through a Securities Intermediary pursuant to clause (v) below;



 54
 









(ii)           Any
Collateral that is a “certificated security” under Article 8 of the UCC shall
be delivered to the Trustee in accordance with paragraph (b) of the definition
of “Delivery” and shall be held, pending maturity or disposition, solely within
the control of the Trustee;


(iii)          Any
Collateral that is an “uncertificated security” under Article 8 of the UCC
shall be delivered to the Trustee in accordance with paragraph (c) of the
definition of ‘“Delivery” and shall be maintained by the Trustee, pending
maturity or disposition in the control of the Trustee;


(iv)          Any
Collateral that is a book-entry security held through the Federal Reserve
System pursuant to Federal book-entry regulations shall be delivered to the
Trustee in accordance with paragraph (d) of the definition of “Delivery” and
shall be maintained by the Trustee, pending maturity or disposition, through
continued book-entry registration of such Collateral in the name of the Trustee
or a Securities Intermediary; and,


(v)           Any
Collateral held through a Securities Intermediary shall be held in a securities
account (as such term is defined in Section 8-501(a) of the UCC) that is
established by such Securities Intermediary in the name of the Trustee for
which the Trustee is the sole entitlement holder; and any Collateral held in a
securities account maintained by a Person other than a Securities Intermediary
shall be held in the securities account under which the Person maintaining the
account undertakes to treat the Trustee as the sole Person entitled to exercise
the rights that comprise the financial assets maintained in the account.


(b)           Effective
upon Delivery of any Collateral in the form of Physical Property, book-entry
securities or uncertificated securities, the Trustee shall be deemed to have
purchased such Collateral for value, in good faith and without notice of any
adverse claim thereto.


Section 11.04.      Delivery of Additional
Collateral.  The Issuer may, from
time to time, and with the prior written consent of the Initial Owner and the
Controlling Party, in the exercise of their sole and absolute discretion,
deliver additional or substitute fee agreements and additional or substitute
incremental revenue or cashflows as additional collateral in connection with
the issuance of Notes, and any such items shall constitute Additional
Collateral.  Following delivery of any
Additional Collateral in accordance with this Article XI of this Indenture, the
Additional Collateral shall be deemed part of the Collateral and subject to all
of the terms and conditions of this Indenture applicable to the Collateral.


ARTICLE
XII


TRUSTEE


Section 12.01.      Acceptance of the Trusts.  The Trustee hereby accepts the trusts imposed
upon it by this Indenture, and agrees to perform such trusts, but only upon and
subject to the following express terms and conditions:



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(a)           Subject
to subsection (g) hereof, the Trustee, prior to the occurrence of an Event of
Default and after the curing of all events of default which may have occurred,
shall undertake to perform such duties and only such duties as are specifically
set forth in this Indenture.  Subject to
subsection (l) hereof, in case an Event of Default has occurred (which has not
been cured or waived), the Trustee shall exercise such of the rights and powers
vested in it by this Indenture and use the same degree of care and skill in
their exercise, as a prudent person would exercise or use under similar
circumstances in the conduct of such person’s own affairs;


(b)           The
Trustee may execute any of the trusts or powers hereof and perform any of its
duties hereunder on behalf of the Issuer by or through attorneys, agents,
receivers or employees and shall not be answerable for the conduct of the same
if appointed by the Trustee with the prior consent of the Issuer and the
Controlling Party and shall be entitled to advice of counsel of its selection
concerning all matters of trusts hereof and the duties hereunder, and may in
all cases pay such reasonable compensation to all such attorneys, agents,
receivers and employees as may reasonably be employed in connection with the
trusts hereof.  The Trustee may act upon
the opinion or advice of any attorneys (who may be the attorney or attorneys
for the Issuer), approved by the Trustee in the exercise of reasonable care
under the circumstances.  The Trustee
shall not be responsible for any loss or damage resulting from any action or
nonaction in good faith in reliance upon such opinion or advice;


(c)           The
Trustee shall not be responsible for any recital herein, or in the Notes, or
for the recording or rerecording, filing or refiling of this Indenture, or for
the validity of the execution by the Issuer of this Indenture or of any
supplements thereto or instruments of further assurance, or for the sufficiency
or the priority of the security for the Notes issued hereunder or secured
hereby except for a loss of priority of the security for the Notes caused by
the failure of the Trustee to perform its obligations under Section 11.02(b) of
this Indenture;


(d)           The
Trustee shall not be accountable for the use of any Notes authenticated or
delivered hereunder.  The Trustee may
become the owner of Notes secured hereby with the same rights which it would
have if not the Trustee;


(e)           The
Trustee shall be protected in conclusively relying and in acting or refraining
from acting upon any notice, request, consent, certificate, order, affidavit,
letter, telegram or other paper or document believed to be genuine and correct
and to have been signed or sent by the proper person or persons.  The Trustee shall not unreasonably withhold
its consent, approval or action to any reasonable request of the Issuer or the
Controlling Party which does not, in the Trustee’s discretion, unless such
consent, approval or action is within the normal course of performing its
duties or the Trustee shall have been offered a satisfactory indemnity bond
pursuant to Section 12.01(l) of this Indenture. 
Any action taken by the Trustee pursuant to this Indenture upon the
request or authority or consent of any person who at the time of making such
request or giving such authority or consent is the owner of any Note shall be
conclusive and binding upon all future owners of the same Note and upon Notes
issued in exchange therefor or in place thereof;



 56
 









(f)            In
case at any time it shall be necessary or desirable for the Trustee to make any
investigation respecting any fact preparatory to taking action or doing or not
doing anything as such Trustee or as to the existence or nonexistence of any
fact or as to the sufficiency or validity of any instrument, paper or
proceedings, the Trustee shall be entitled to request and rely conclusively
upon a certificate signed by an Authorized Officer of the Issuer as sufficient
evidence of the facts therein contained, and prior to the occurrence of a
default of which the Trustee has been notified as provided in subsection (h) of
this Section, or of which by such subsection it is deemed to have notice, shall
also be at liberty to accept a similar certificate to the effect that any
particular dealing, transaction or action is necessary or expedient, but may,
at its discretion, secure such further evidence deemed necessary or advisable,
but shall in no case be bound to secure the same.  The Trustee may accept a certificate of an
Authorized Officer of the Issuer under its seal to the effect that a resolution
in the form therein set forth has been adopted by the Issuer, as conclusive
evidence that such resolution has been duly adopted, and is in full force and
effect;


(g)           The
permissive right of the Trustee to do things enumerated in this Indenture shall
not be construed as a duty and it shall not be answerable for other than its
own gross negligence or willful misconduct;


(h)           The
Trustee shall not be required to take notice or be deemed to have notice of any
default hereunder except a payment default under Section 10.01(a) hereof,
unless the Trustee shall be specifically notified in writing of such default by
the Issuer, the Controlling Party or by the owners of at least 5% in aggregate
principal amount of Notes then Outstanding and all notices or other instruments
required by this Indenture to be delivered to the Trustee must, in order to be
effective, be received by a responsible corporate trust officer at the
designated corporate trust office of the Trustee, and, in the absence of such
notice so delivered, the Trustee may conclusively assume there is no default
except as aforesaid;


(i)            At
any and all reasonable times, the Trustee and its duly authorized agents,
attorneys, experts, engineers, accountants and representatives shall have the
right fully to inspect any and all of the property herein conveyed, including
all books, papers and records of the Issuer pertaining to the Notes, and to
take such memoranda from and in regard thereto as may be desired.


(j)            The
Trustee shall not be required to give any bond or surety in respect of the
execution of such trusts and powers or otherwise in respect of the premises;


(k)           Notwithstanding
anything elsewhere in this Indenture contained, in respect of the
authentication of any Notes, the withdrawal of any cash, or the taking of any
action whatsoever within the purview of this Indenture, the Trustee shall have
the right, but shall not be required, to reasonably demand the delivery of any
showings, certificates, opinions, appraisals or other information, or corporate
action or evidence thereof, in addition to that by the terms hereof required as
a condition of such action by the Trustee deemed desirable for the purpose of
establishing the right of the Issuer to the



 57
 









authentication
of any Notes, the withdrawal of any cash or the taking of any other action by
the Trustee;


(l)            The
Trustee shall not be required to expend or risk its own funds or otherwise
incur any liability other than in the normal course of performing its duties
hereunder, and, prior to taking any action or omission to take action, the
Trustee may require that a satisfactory indemnity bond be furnished for the
reimbursement of all expenses which it may reasonably incur and to protect it
against all liability, except liability which is adjudicated to have resulted
from its own gross negligence or willful misconduct by reason of any action so
taken;


(m)          All
money received by the Trustee or any Paying Agent shall, until used or applied
or invested as herein provided, be held in trust for the purposes for which it
was received, but need not be segregated from other funds except to the extent
required by law;


(n)           Any
action required to be taken by the Trustee under this Indenture on a day that
is not a Business Day shall be taken on the next succeeding Business Day;


(o)           The
duties and obligations of the Trustee shall be determined solely by the express
provisions hereof;


(p)           The
Issuer agrees to indemnify each of the Trustee or any predecessor Trustee and
their agents for, and to hold them harmless against, any and all loss, damage,
claims, liability or expense, including taxes (other than taxes based upon, measured
by or determined by the income of the Trustee), arising out of or in connection
with the acceptance or administration of the trust or trusts hereunder,
including the costs and expenses of defending itself against any claim (whether
asserted by the Issuer, or any Noteholder or any other Person) or liability in
connection with the exercise or performance of any of its powers or duties
hereunder, or in connection with enforcing the provisions of this Section,
except to the extent that such loss, damage, claim, liability or expense is due
to its own gross negligence or willful misconduct.  The provisions of this Section shall survive
the termination of this Indenture;


(q)           In
no event shall the Trustee be responsible or liable for special, indirect, or
consequential loss or damage of any kind whatsoever (including, but not limited
to, loss of profit) irrespective of whether the Trustee has been advised of the
likelihood of such loss or damage and regardless of the form of action, except
for gross negligence or willful misconduct; and,


(r)            The
rights, privileges, protections, immunities and benefits given to the Trustee,
including, without limitation, its right to be indemnified, are extended to,
and shall be enforceable by, the Trustee in each of its capacities hereunder,
and each agent, custodian and other Person employed to act hereunder.



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Section
12.02.      Fees, Charges
and Expenses of the Trustee and Paying Agents; Other Fees and Expenses.


(a)           The
Trustee and any Paying Agent shall be entitled to payment and reimbursement for
Trustee Fees and expenses from money available therefor as specified in Section
7.03 and Section 10.04 hereof.  In the
event it becomes necessary for the Trustee to perform extraordinary services hereunder,
the Trustee shall obtain the prior approval therefor from the Issuer and shall
be entitled to reimbursement for its expenses (including attorney’s fees and
expenses) from the legally available funds of the Issuer but not from the Trust
Estate.  The Issuer shall be responsible
for payment of Trustee Fees and expenses to the extent funds are not otherwise
available therefore under Section 7.03. 
The provisions of this Section 12.02 shall survive the termination of
this Indenture.


(b)           The
Issuer shall pay all fees and expenses related to the transaction under this
Indenture, including any amounts required for enforcement of any of the Fee
Agreements or other agreements related hereto.


Section 12.03.      Notice to Noteholders if
Default Occurs.  If a default occurs
of which the Trustee is by Section 12.01(h) hereof required to take notice, or
if notice of default be given as provided in Section 12.01(h) hereof, then the
Trustee shall promptly give written notice thereof in accordance with Section
10.09 hereof.


Section 12.04.      Intervention by Trustee.  In any judicial proceeding concerning the
issuance or the payment of the Notes to which the Issuer is party, the Trustee
may intervene on behalf of the Noteholders and shall do so, subject to the
provisions of Section 12.01(l) hereof, if requested in writing by the owners of
at least 25% of the aggregate principal amount of Notes then Outstanding.


Section 12.05.      Successor Trustee.  With the written consent of the Issuer, any
corporation or association into which the Trustee may be converted or merged, or
with which it may be consolidated, or to which it may sell or transfer its
corporate trust business and assets as a whole or substantially as a whole, or
any corporation or association resulting from any such conversion, sale,
merger, consolidation or transfer to which it is a party, or any successor
Trustee appointed in accordance with this Indenture, ipso facto shall be and
become successor Trustee hereunder and vested with all of the title to all the
trusts, powers, discretions, immunities, privileges and all other matters as
was its predecessor, without the execution or filing of any instrument or any
further act, deed or conveyance on the part of any of the parties hereto,
anything herein to the contrary notwithstanding.


Section 12.06.      Resignation by Trustee.  The Trustee and any successor Trustee may at
any time resign from the trusts hereby created by giving thirty (30) days’
written notice by registered or certified mail to the Issuer and the Initial
Owner by first class mail (postage prepaid) and to the owners of each Note, and
such resignation shall take effect upon the appointment of a successor Trustee
by the Issuer or the owners of the Notes in accordance with Section 12.08.  The Trustee shall not be relieved of its
duties hereunder until a successor has accepted such duties.  The Trustee shall have the right to petition,
at the expense of the Issuer, a court of competent jurisdiction for the
appointment of a permanent successor trustee if none has been appointed within
such 30-day period.



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Section 12.07.      Removal of Trustee.  The Trustee may be removed at any time by the
Issuer by written notice given by the Issuer to the Trustee and the Initial
Owner, so long as no Event of Default exists hereunder, or by an instrument in
writing delivered to the Trustee, the Issuer and the Controlling Party, and
signed by the owners of a majority in aggregate principal amount of Notes then
Outstanding.  The Trustee shall not be
relieved of its duties hereunder until a successor has accepted such
duties.  Any such successor shall be
appointed by the Issuer.  The Trustee
shall have the right to petition, at the expense of the Issuer, a court of
competent jurisdiction for the appointment of a permanent successor trustee if
none has been appointed within a 30-day period.


Section 12.08.      Appointment of Successor
Trustee by the Noteholders; Temporary Trustee.  In case the Trustee hereunder shall resign or
be removed, or be dissolved, or shall be in course of dissolution or
liquidation, become insolvent or bankrupt, or otherwise become incapable of
acting hereunder, or in case it shall be taken under the control of any public
officer or officers, or of a receiver appointed by a court, and the Issuer
shall not appoint a successor Trustee within thirty (30) days after such event,
a successor may be appointed by the owners of a majority in aggregate principal
amount of Notes then Outstanding by an instrument or concurrent instruments in
writing signed by such owners, or by their attorneys in fact, duly authorized
and a copy of which shall be delivered personally or sent by registered mail to
the Issuer and the Initial Owner. 
Nevertheless, in case of such vacancy, the Issuer by resolution shall
appoint a temporary Trustee to fill such vacancy until a successor Trustee
shall be appointed by the Noteholders in the manner above provided; and any
such temporary Trustee so appointed by the Issuer shall immediately and without
further act be superseded by the Trustee so appointed by such Noteholders.  Notice of the appointment of a successor
Trustee shall be given in the same manner as provided in Section 12.06 hereof
with respect to the resignation of the Trustee. 
Every such Trustee appointed pursuant to the provisions of this Section
shall be a trust company or bank in good standing, duly authorized to exercise
trust powers within the State and subject to examination by a federal or State
authority, having (a) approximately $50,000,000 in capital and undivided
profits surplus and (b) substantial experience as a trustee for revenue bonds,
as evidenced by serving as trustee for at least three issues totaling at least
$100,000,000.


Notwithstanding anything
in this Section 12.08 to the contrary, no successor Trustee shall be appointed
hereunder without the consent of the Controlling Party.


Section 12.09.      Concerning any Successor
Trustee.  Every successor Trustee
appointed hereunder shall execute, acknowledge and deliver to its predecessor
and also to the Issuer and Controlling Party an instrument in writing accepting
such appointment hereunder, and thereupon such successor, without any further
act, deed or conveyance, shall become fully vested with all the estates,
properties, rights, powers, trusts, duties and obligations of its predecessors;
but such predecessors shall, nevertheless, on the written request of the Issuer
or the Controlling Party, or of their respective successors, execute and
deliver an instrument transferring to such successor Trustee all the estates,
properties, rights, powers and trusts of such predecessor hereunder; and every
predecessor Trustee shall, upon payment of its charges, deliver all securities
and money held by it as the Trustee hereunder to its successor.  Should any instrument in writing from the
Issuer be required by any successor Trustee for more fully and certainly
vesting in such successor the estate, rights, powers and duties hereby vested
or intended to be vested in the predecessor, any and all such instruments in
writing shall, on request, be executed,



 60
 









acknowledged and delivered by the Issuer.  The resignation of any Trustee and the
instrument or instruments removing any Trustee and appointing a successor
hereunder, together with all other instruments provided for in this Article,
shall be filed or recorded by the successor Trustee in each recording office
where this Indenture or notice hereof shall have been filed or recorded.


Section 12.10.      Designation and Succession
of Paying Agent.  The Trustee is
hereby appointed as Paying Agent.  Any
bank, national association or trust company with which or into which any Paying
Agent may be merged or consolidated, or to which all or substantially all of
the corporate trust assets and business of such Paying Agent may be sold, shall
be deemed the successor of such Paying Agent for the purposes of this
Indenture.  If the position of Paying
Agent shall become vacant for any reason, the Issuer shall, within thirty (30)
days thereafter, appoint a bank, national association or trust company, or
other entity as such Paying Agent to fill such vacancy; provided, however, that
if the Issuer shall fail to appoint such Paying Agent within such period, the
Trustee shall make the appointment. 
Other Paying Agents or fiscal agents may be appointed pursuant to
Article XIV hereof by the Issuer if in its discretion additional Paying Agents
or fiscal agents are deemed advisable.


The Paying Agent shall
enjoy the same protection provisions in the performance of its duties hereunder
as are specified in Section 12.01 hereof with respect to the Trustee insofar as
such provisions may be applicable.


Notice of the appointment
of additional Paying Agents or fiscal agents shall be given in the same manner
as provided by Section 12.06 hereof with respect to the appointment of a
successor Trustee.


Section 12.11.      Appointment of Co-Trustee.  It is the purpose of this Indenture that
there shall be no violation of any law of any jurisdiction denying or
restricting the right of banking corporations or associations to transact
business as the Trustee in such jurisdiction. 
It is recognized that, in case of litigation under this Indenture and,
in particular, in case of the enforcement thereof on default, or in case the
Trustee deems that by reason of any present or future law of any jurisdiction,
it may not exercise any of the powers, rights or remedies herein granted to the
Trustee or hold title to the properties, in trust, as herein granted, or take
any other action which may be desirable or necessary in connection therewith,
it may be necessary that the Trustee appoint an additional institution as a
separate or co-Trustee; provided that any co-Trustee must have capital, surplus
and undivided profits of at least $50,000,000. 
The following provisions of this Section are adapted to these ends.


In the event that the
Trustee appoints an additional institution as a separate or co-Trustee, each
and every remedy, power, right, claim, demand, cause of action, immunity,
estate, title, interest and lien expressed or intended by this Indenture to be
exercised by or vested in or conveyed to the Trustee with respect thereto shall
be exercisable by and vest in such separate or co-Trustee but only to the
extent necessary to enable such separate or co-Trustee to exercise such powers,
rights and remedies, and every covenant and obligation necessary to the
exercise thereof by such separate or co-Trustee shall run to and be enforceable
by either of them.  The responsibilities
of the co-Trustee under this Indenture shall be limited to exercising remedies
as provided herein, and providing such assistance to the Trustee as may be necessary
to carry out the duties of the Trustee and co-Trustee hereunder.



 61
 









Should any instrument in
writing from the Issuer be required by a separate or co-Trustee so appointed by
the Trustee for more fully and certainly vesting in and confirming to him or it
such properties, rights, powers, trusts, duties and obligations, any and all
such instruments in writing shall, on request, be executed, acknowledged and
delivered by the Issuer.  In case any
separate or co-Trustee, or a successor to either, shall cease to exist, become
incapable of acting, resign or be removed, all the estates, properties, rights,
powers, trusts, duties and obligations of such separate or co-Trustee, so far
as permitted by law, shall vest in and be exercised by the Trustee until the appointment
of a new Trustee or successor to such separate or co-Trustee.  No Trustee hereunder shall be personally
liable by reason of any act or omission of any other Trustee hereunder.


Section 12.12.      Trustee Not Liable for
Failure of Others to Act.  The Trustee
shall not be liable or responsible because of the failure of the Issuer or any
of its employees or agents to make any collections or deposits or to perform
any act herein required of the Issuer or because of the loss of any monies
arising through the insolvency or the act or default or omission of any other
depositary in which such monies shall have been deposited in accordance with
this Indenture.  The Trustee shall not be
responsible for the application of any of the proceeds of the Notes or any other
monies deposited with it and paid out, withdrawn or transferred hereunder if
such application, payment, withdrawal or transfer shall be made in accordance
with the provisions of this Indenture. 
The immunities and exemptions from liability of the Trustee hereunder
shall extend to its directors, officers, employees and agents.


None of the provisions of
this Indenture shall be construed to relieve the Trustee from liability for its
own grossly negligent action, its own grossly negligent failure to act, or its
own willful misconduct, except that (a) the Trustee shall not be liable for any
error of judgment reasonably consistent with the prudent person standard set
forth in Section 12.01(a) hereof made in good faith by any one of its officers,
unless it shall be established that the Trustee was grossly negligent in
ascertaining the pertinent facts on which such judgment is based; and (b) the
Trustee shall not be liable with respect to any action taken or omitted to be
taken by it in good faith in accordance with the direction of the Owners of not
less than a majority in aggregate principal amount of the Notes then
Outstanding, relating to the time, method and place of conducting any
proceedings to be taken by the Trustee in connection with the enforcement of the
terms and conditions of this Indenture or for the appointment of a receiver
hereunder.


ARTICLE
XIII


NOTE
DEPOSITORY


Section 13.01.      Qualifications of a Note
Depository, a Successor Note Depository or Substitute Depository.  If the Issuer and the Registrar determine
from time to time to have the Notes held by a Note Depository, such Note
Depository, successor Note Depository or Substitute Depository must be a “clearing
corporation” within the meaning of the New York Uniform Commercial Code and a
qualified and registered “clearing agent” as provided in Section 17A of the
Securities Exchange Act of 1934, as amended.



 62
 









Section 13.02.      Resignation of Note
Depository.  Any Note Depository may
resign in its sole discretion with sixty (60) days prior written notice to the
Issuer, Registrar and the Trustee.


Section 13.03.      Removal of Note Depository
by the Trustee.  The Note Depository
may be removed by direction of the Trustee in its sole discretion with or
without cause and without the necessity of stating a cause if the Trustee
determines that it is not in the best interest of the Noteholders to continue
the book-entry system only system, by written notice to the Note Depository,
the Registrar, the Issuer, and the Paying Agent specifying the removal date of
such Note Depository.


Section 13.04.      Removal of Note Depository
by the Issuer and the Registrar.  The
Note Depository may be removed by the Issuer and the Registrar, with the
consent of the Trustee, if:


(a)           such
Note Depository is no longer able to provide such book-entry only services; or,


(b)           such
Note Depository is no longer qualified as set forth in this Article to perform
such book-entry only services.


In any such event, the
Registrar shall immediately notify in writing the Note Depository of its
removal.


Section 13.05.      Effective Date of
Resignation or Removal of Note Depository. 
Resignation or removal of the Note Depository in accordance with this
Article shall be effective on the date specified in the instrument of
resignation or removal or notice of either, unless a Substitute Depository or a
successor Note Depository shall have been previously appointed, in which event
the resignation or removal shall take effect immediately; provided, however,
that the resignation or removal of the Note Depository shall not be effective
unless and until a Substitute Depository has been appointed or successor Note
Depository established pursuant to this Article.


Section 13.06.      Appointment of Substitute
Depository.  Upon the resignation or
removal of the Note Depository, the Trustee shall appoint a Substitute
Depository and shall send notice to the Paying Agent, the Registrar, and the
Issuer of such action.


Section 13.07.      Successor Note Depository.  A successor of any Note Depository shall be
any corporation into which any Note Depository may be merged or converted or
with which it may be consolidated, or any corporation resulting from any
merger, consolidation or conversion to which any Note Depository may be a
party, or any corporation succeeding to the book-entry only system or any Note
Depository so long as such successor Note Depository is qualified to act as a
Note Depository in accordance with the provision of this Article.


Section 13.08.      Purpose of Transfer or
Exchange of Global Certificates. 
Global Certificates may be transferred or exchanged for other Global
Certificates as follows:


(a)           in
the event of a redemption in accordance with Article III hereof;



 63
 









(b)           upon
registration of transfer of ownership of a Global Certificate to a Substitute
Depository; or


(c)           to
a successor of any Note Depository.


Section 13.09.      Mechanics of Transfer of the
Global Certificates.  If the Global
Certificate is transferred for the reasons set forth in Sections 13.08(b) or
13.08(c), such Global Certificate shall be presented to the Registrar and the
Registrar shall record the name of the transferee on the registration books
maintained by the Registrar and shall make a notation of such ownership on the
panel provided on the Global Certificate.


Section 13.10.      Mechanics of Exchange of the
Global Certificate for Another Global Certificate.  In the event of an exchange of a Global
Certificate for the reason set forth in Section 13.08(a), such Global
Certificate shall be exchanged as provided for in Section 2.11 of this
Indenture.


Section 13.11.      Exchange of the Global
Certificate for Replacement Notes. 
Replacement Notes shall be issued if the Trustee is unable to locate a
Substitute Depository within two (2) months following either the resignation or
the removal of the Note Depository.


Section 13.12.      Procedures to Convert
Replacement Notes.  The procedures
governing the conversion of Global Certificates into certificated Notes are set
forth in Section 2.11 of this Indenture.


Section 13.13.      Exchange of the Global
Certificate for Replacement Notes. 
In the event that a Substitute Depository is appointed, or a successor
Note Depository is established, or in the event of a conversion to certificated
Notes, the Registrar shall obtain from the predecessor depository of the Notes
the records which designate the identities of all of the purchasers of the
Notes.


Section 13.14.      Liability of Note
Depository.  Any Note Depository
selected in accordance with this Article and each of its Participants and the
purchasers of the Notes, by their acceptance of the Notes agree that the Issuer
and the Registrar shall have no liability for the failure of any such Note
Depository which may be selected as herein provided to perform its obligations
to the Participants and the Beneficial Owners of the Notes, nor shall the
Issuer or the Registrar be liable for the failure of any Participant or other
nominee of the Beneficial Owners to perform any obligation the Participant may
incur to a Beneficial Owner of the Notes, and that the Registrar shall have no
fiduciary duties to the Note Depository, Participants or Beneficial Owners;
provided, however, that nothing contained in this Section shall affect or
diminish the Registrar’s duties and responsibilities under this Indenture to
act on behalf of all Owners, in any such Note Depository.


ARTICLE
XIV


SUPPLEMENTAL
INDENTURES


Section 14.01.      Supplemental Indentures not
Requiring Consent of Noteholders. 
The Issuer and the Trustee may, without the consent of, or notice to any
of the Noteholders enter



 64
 









into an
indenture or indentures supplemental to this Indenture as shall not be
inconsistent with the terms and provisions hereof for any one or more of the
following purposes:


(a)           To
cure any ambiguity or formal defect or omission in this Indenture;


(b)           To
grant to or confer upon the Trustee for the benefit of the Noteholders any
additional benefits, rights, remedies, powers or authorities that may lawfully
be granted to or conferred upon the Noteholders or the Trustee, or to make any
change which, in the judgment of the Issuer, is not to the prejudice of the
Noteholders.  The Trustee may rely
conclusively on opinions of counsel as to such modifications;


(c)           To
subject to this Indenture additional revenues, properties or collateral;


(d)           To
modify, amend or supplement this Indenture or any indenture supplemental hereto
in such manner as to permit the qualification hereof and thereof under the
Trust Indenture Act of 1939 or any similar federal statute hereafter in effect
or to permit the qualification of the Notes for sale under the securities law
of any of the states of the United States of America, and, if they so
determine, to add to this Indenture or any indenture supplemental hereto such
other terms, conditions and provisions as may be permitted by the Trust
Indenture Act of 1939 or similar federal statute;


(e)           To
evidence the appointment of a separate Trustee or co-Trustee or the succession
of a new Trustee or Paying Agent hereunder; or


(f)            To
add to the covenants and agreements of the Issuer in this Indenture other
covenants and agreements thereafter to be observed by the Issuer, or to
surrender any right or power herein reserved to or conferred upon the Issuer.


Notwithstanding anything
in this Section 14.01 or in Section 14.02 to the contrary, the Issuer and the
Trustee shall not enter into any indenture or indentures supplemental to this
Indenture without the prior written consent of the Controlling Party.


Section 14.02.      Supplemental Indentures
Requiring Consent of Noteholders. 
Exclusive of supplemental indentures covered by Section 14.01 hereof and
subject to the terms and provisions contained in this Section, and not
otherwise, the owners of not less than two-thirds in aggregate principal amount
of all Notes then Outstanding shall have the right, from time to time, anything
contained in this Indenture to the contrary notwithstanding, to consent to and
approve the execution by the Issuer and the Trustee, of such other indenture or
indentures supplemental hereto as shall be deemed necessary and desirable by
the Issuer for the purpose of modifying, altering, amending, adding to or
rescinding, in any particular, any of the terms or provisions contained in this
Indenture or in any supplemental indenture; provided, however, that nothing in
this Section contained shall permit, or be construed as permitting, without the
consent of the owners of all Outstanding Notes, (a) an extension of the
maturity date of any Note issued hereunder or (b) a reduction in the principal
amount of any Note or the rate of interest thereon; provided further that
nothing in this Section contained shall permit, or be construed as permitting,
without the consent of the owners of all Outstanding Notes, (i) a privilege or
priority of any Note or Notes over any other Note or Notes (other than those
privileges or priorities granted herein), or (ii) a reduction in the aggregate
principal amount of the Notes required for



 65
 









consent to such supplemental indenture, or (iii) the creation of any
Lien other than a Lien ratably securing all of the Notes at any time
Outstanding hereunder, or (iv) any modification of the trusts, powers, rights,
obligations, duties, remedies, immunities and privileges of the Trustee.


If at any time the Issuer
shall request the Trustee to enter into any such supplemental indenture for any
of the purposes of this Section, the Trustee shall, upon being satisfactorily
indemnified, cause notice of the proposed execution of such supplemental
indenture to be mailed by registered or certified mail or by overnight delivery
service to each owner of the Notes as shown on the list of Noteholders required
by Section 5.05 hereof.  Such notice
shall be prepared by or on behalf of the Issuer and shall briefly set forth the
nature of the proposed supplemental indenture and shall state that copies thereof
are on file at the designated corporate trust office of the Trustee for
inspection by all Noteholders.  If within
sixty (60) days or such longer period as shall be prescribed by the Issuer
following the mailing of such notice, the owners of not less than two-thirds in
aggregate principal amount of the Notes Outstanding, or of all Notes then
Outstanding, as the case may be, at the time of the execution of any such
supplemental indenture shall have consented to and approved the execution
thereof as herein provided, no owner of any Note shall have any right to object
to any of the terms and provisions contained herein, or the operation thereof,
or in any manner to question the propriety of the execution thereof, or to
enjoin or restrain the Trustee or the Issuer from executing the same or from
taking any action pursuant to the provisions thereof.


Upon the execution of any
such supplemental indenture as in this Section is permitted and provided, this
Indenture shall be and be deemed to be modified and amended in accordance
therewith.


Section 14.03.      Discretion of Issuer and
Trustee to Execute Supplemental Trust Indenture.  In each and every case provided for in this
Article, the Issuer and the Trustee shall be entitled to exercise their
discretion in determining whether or not to execute any proposed supplemental
trust indenture if their respective rights, obligations and interests would be
affected, and neither the Trustee nor the Issuer shall be under any liability
to the other or to any Owner or anyone whomsoever for its refusal in good faith
to enter into any such supplemental trust indenture if such trust indenture is
deemed by either of them to be contrary to the provisions of this Article.  The Trustee shall be entitled to receive, and
shall be fully protected in conclusively relying upon, any counsel’s opinion,
which counsel may be counsel for the Issuer, as conclusive evidence that any
such proposed supplemental trust indenture does or does not comply with the
provisions of this Indenture and that it is or is not proper for it, under the
provisions of this Article, to join in the execution of such supplemental trust
indenture.


ARTICLE
XV


MISCELLANEOUS


Section 15.01.      Consents, etc., of
Noteholders.  Any consent, request,
direction, approval, objection or other instrument required by this Indenture
to be signed and executed by the Noteholders may be in any number of concurrent
writings of similar tenor and may be signed or executed by such Noteholders in
person or by agents appointed in writing. 
Proof of the execution of any such consent, request, direction, approval
objection or other instrument or of



 66
 









the writing appointing any such agent and of the ownership of Notes, if
made in the following manner, shall be sufficient for any of the purposes of
this Indenture, and shall be conclusive in favor of the Trustee and any Paying
Agent with regard to any action taken by it under such request or other
instrument, namely:


(a)           The
fact and date of the execution by any Person of any such writing may be proved
by the certificate of any officer in any jurisdiction who by law has power to
take acknowledgments within such jurisdiction that the Person signing such
writing acknowledged before him the execution thereof, or by an affidavit of
any witness to such execution.


(b)           The
fact of ownership of the Notes and the amount or amounts, numbers and other
identification of Notes, and the date of holding the same shall be proved by
the registration books of the Issuer maintained by the Trustee pursuant to
Section 2.08 hereof.


Section 15.02.      Third Party Beneficiaries;
Limitation of Rights.  The Initial
Owner shall be an express third party beneficiary of this Indenture and shall
have the right to enforce the provisions of this Indenture as if it were a
party hereto.  With the exception of the
third party beneficiary rights conferred on the Initial Owner and other rights
herein expressly conferred, nothing expressed or mentioned in or to be implied
from this Indenture or the Notes is intended or shall be construed to give to
any Person other than the parties hereto, the Initial Owner, the other owners
of the Notes, and assignees and subrogees thereof, any legal or equitable
right, remedy or claim under or in respect to this Indenture or any covenants,
conditions and provisions herein contained; this Indenture and all of the
covenants, conditions and provisions hereof being intended to be and being for
the sole and exclusive benefit of the parties hereto and the owners of the
Notes and assignees and subrogees thereof as herein provided.


Section 15.03.      Severability.  If any provision of this Indenture shall be
held or deemed to be or shall, in fact, be illegal, inoperative or
unenforceable, the same shall not affect any other provision or provisions
herein contained or render the same invalid, inoperative or unenforceable to
any extent whatever.


Section 15.04.      Notices.  Any notice, request, complaint, demand,
communication or other paper shall be sufficiently given and shall be deemed
given when delivered or mailed by registered or certified mail, postage
prepaid, or sent by telecopy or overnight courier or by telegram, addressed to
the appropriate Notice Address.  The
Issuer, the Trustee and the Initial Owner may, by notice given hereunder,
designate any further or different addresses to which subsequent notices,
certificates or other communications shall be sent.


Section 15.05.      Payments Due on Saturdays,
Sundays and Holidays.  In any case
where the Maturity Date or the Redemption Date fixed for redemption of any Note
shall not be a Business Day, then payment of interest or principal may be made
on the next succeeding Business Day with the same force and effect as if made
on the Maturity Date or the Redemption Date.



 67
 









Section 15.06.      Counterparts.  This Indenture may be simultaneously executed
in several counterparts, each of which shall be an original and all of which
shall constitute but one and the same instrument.


Section 15.07.      Applicable Provisions of
Law; Waiver of Jury Trial; Forum Selection. 
THIS INDENTURE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK.  EACH OF
THE ISSUER AND THE TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE, THE NOTES OR THE
TRANSACTIONS CONTEMPLATED HEREBY.


Each of the parties
hereto (i) hereby irrevocably submits to the nonexclusive jurisdiction of the
Supreme Court of the State of New York, New York County (without prejudice to
the rights of any party to remove to the United States District Court for the
Southern District of New York) and to the nonexclusive jurisdiction of the
United States District Court for the Southern District of New York, for the
purpose of any suit, action or other proceeding arising out of this Indenture,
or the subject matter hereof or any of the transactions contemplated hereby or
thereby brought by any of the parties hereto or their successors or assigns,
(ii) hereby irrevocably agrees that all claims in respect of such action or
proceeding may be heard and determined in such New York State court or, to the
fullest extent permitted by applicable governmental rule, in such Federal
court, and (iii) to the extent permitted by applicable law, hereby irrevocably
waives, and agrees not to assert, by way of motion, as a defense, or otherwise,
in any such suit, action or proceeding any claim that it is not personally
subject to the jurisdiction of the above-named courts, that the suit, action or
proceeding is brought in an inconvenient forum, that the venue of the suit,
action or proceeding is improper or that this Indenture or the subject matter
hereof may not be enforced in or by such court. 
A final judgment obtained in respect of any action, suit or proceeding
referred to in this Section 15.07 shall be conclusive and may be enforced in
other jurisdictions by suit or judgment or in any manner as provided by
applicable law.  Each of the parties
hereto hereby consents to service of process in connection with the subject
matter specified in the first sentence of this Section 15.07 in connection with
the above-mentioned courts in New York by registered mail, Federal Express, DHL
or similar courier at the address to which notices to it are to be given, it
being agreed that service in such manner shall constitute valid service upon
such party or its respective successors or assigns in connection with any such
action or proceeding only; provided, however, that nothing in this Section
15.07 shall affect the right of any of such parties or their respective successors
or assigns to serve legal process in any other manner permitted by applicable
law.


Section 15.08.      Captions or Headings in this
Indenture.  The captions or headings in this Indenture are
for convenience only and in no way define, limit or describe the scope or
intent of any provisions or Sections of this Indenture.


Section 15.09.      Force Majeure.  In
no event shall the Trustee be responsible or liable for any failure or delay in
the performance of its obligations hereunder arising out of or caused by, directly
or indirectly, forces beyond its control, including, without limitation,
strikes, work stoppages, accidents, acts of war or terrorism, civil or military
disturbances, nuclear or natural catastrophes or acts of God which may cause,
among other things, interruptions, loss or



 68
 









malfunctions of utilities, communications or computer (software and
hardware) services; it being understood that the Trustee shall use reasonable
efforts which are consistent with accepted practices in the banking industry to
resume performance as soon as practicable under the circumstances.


[Remainder of page
intentionally left blank]



 69
 









IN
WITNESS WHEREOF, the
Issuer has caused this Indenture to be signed in its name and behalf by its
General Partner to evidence its acceptance of the trusts hereby created, the
Trustee has caused this Indenture to be signed in its name and behalf by its
duly authorized officer, as of the day first above written.


	
  

  	
  GMH COMMUNITIES,
  LP, a Delaware limited partnership

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   GMH
  COMMUNITIES GP TRUST, a Delaware 

  
	
   

  	
   

  	
     statutory
  trust, its general partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Joseph
  Macchione

  	
   

  
	
   

  	
   

  	
   

  	
  By: Joseph
  Macchione

  
	
   

  	
   

  	
   

  	
  Title: Vice
  President

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  
	
   

  	
  U.S. BANK TRUST
  NATIONAL ASSOCIATION, as Trustee

  
	
   

  
	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Thomas E.
  Tabor

  	
   

  
	
   

  	
   

  	
  Name: Thomas E.
  Tabor

  
	
   

  	
   

  	
  Title: Vice
  President

  
								



 


 


[SIGNATURE PAGE
FOR INDENTURE]



 70















EXHIBIT A



FORM OF SERIES 2007 NOTE


The text of the Notes,
and the authentication certificate of Trustee to be printed thereon, shall be,
respectively, in substantially the following form, to wit:


GMH COMMUNITIES, LP


TAXABLE
NOTE


SERIES 2007


Dated:  May 7, 2007


	
  Variable

  Interest Rate

  	
   

  	
  Maturity Date

  	
   

  	
  CUSIP

  
	
   

  	
   

  	
  April 30, 2010

  	
   

  	
  36188TAA2

  



 


	
  No. R-1

  	
   

  
	
   

  	
   

  
	
  PRINCIPAL AMOUNT:

  	
  $100,000,000

  
	
   

  	
   

  
	
  REGISTERED OWNER:

  	
  CEDE & Co.

  



 


THIS
NOTE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES ACT”) OR THE SECURITIES LAWS OF ANY STATE.  ANY RESALE, TRANSFER, PLEDGE OR OTHER
DISPOSITION OF THIS NOTE OR ANY INTEREST HEREIN WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND WHICH IS IN ACCORDANCE WITH THE INDENTURE (AS
DEFINED HEREIN).


THIS
NOTE IS SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE
REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT TO A PERSON WHO THE
TRANSFEROR REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE
MEANING OF RULE 144A OF THE SECURITIES ACT. 
THE PURCHASER HEREOF AGREES TO PROVIDE NOTICE TO ANY PROPOSED TRANSFEREE
OF A BENEFICIAL OWNERSHIP INTEREST IN THE PURCHASED NOTES OF THE
RESTRICTION ON TRANSFERS ONLY TO QUALIFIED
INSTITUTIONAL BUYERS.



 A-1
 









EXCEPT
FOR THE INITIAL OWNER, EACH TRANSFEREE OF THIS NOTE BY ITS PURCHASE HEREOF, IS
DEEMED TO HAVE REPRESENTED THAT SUCH TRANSFEREE IS A QUALIFIED INSTITUTIONAL
BUYER WITHIN THE MEANING OF RULE 144A OF THE SECURITIES ACT, AND WILL ONLY
TRANSFER, RESELL, REOFFER, PLEDGE OR OTHERWISE TRANSFER THIS NOTE TO A
SUBSEQUENT TRANSFEREE WHO SUCH TRANSFEROR REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT
AND WHO IS WILLING AND ABLE TO CONDUCT AN INDEPENDENT INVESTIGATION OF THE
RISKS INVOLVED WITH OWNERSHIP OF THE SERIES 2007 NOTES (AS DEFINED IN THIS
NOTE) AND AGREES TO BE BOUND BY THE TRANSFER RESTRICTIONS.


THIS
NOTE IS SUBJECT IN ALL RESPECTS TO THE TERMS OF TRUST INDENTURE, DATED AS OF
MAY 7, 2007, BETWEEN GMH COMMUNITIES, LP, AS ISSUER (THE “ISSUER”), AND U.S.
BANK TRUST NATIONAL ASSOCIATION, AS TRUSTEE (THE “INDENTURE”), AND THAT CERTAIN
NOTE PURCHASE AGREEMENT DATED MAY 7, 2007 BETWEEN THE ISSUER AND MERRILL LYNCH,
PIERCE, FENNER & SMITH INCORPORATED (THE “NOTE PURCHASE AGREEMENT”).


NEITHER
THIS NOTE NOR ANY OBLIGATION REPRESENTED HEREBY MAY BE TRANSFERRED TO ANY PARTY
EXCEPT IN ACCORDANCE WITH THE TRANSFER RESTRICTIONS SET FORTH IN THE INDENTURE.


The Issuer, for a value
received, hereby promises to pay, solely from the sources and in the manner
hereinafter provided, to the order of the Registered Owner named above, or
registered assigns, on the Maturity Date specified above (or earlier as herein
provided) the Principal Amount specified above as shall have been advanced to
the Issuer by the Initial Owner pursuant to the terms of the Indenture and to
pay interest on such Principal Amount from the Interest Payment Date (as
hereinafter defined) next preceding the date of registration and authentication
of this Note, unless this Note is registered and authenticated as of an
Interest Payment Date, in which case it shall bear interest from said Interest
Payment Date; or unless this Bond is registered and authenticated prior to June
1, 2007, in which event this Note shall bear interest from the Dated Date
above; or unless, as shown by the records of the Trustee (as hereinafter
defined), interest on this Note shall be in default, in which event this Note
shall bear interest from the date to which interest was last paid on this Note,
until the Issuer’s obligations with respect to payment of such Principal Amount
shall be discharged, at the Note Rate per annum for the Notes calculated as
described herein, payable on the first calendar day of each calendar month (or
if such day is not a Business Day (as defined in the Indenture), the next
succeeding Business Day) commencing June 1, 2007 (each, an “Interest Payment
Date”) until such Principal Amount is duly paid, unless this Note shall have
been previously called for redemption and payment therefor shall have been duly
made or provided.


The principal of and
interest on this Note shall be payable in lawful money of the United States of
America, without exchange or collection charges, upon presentation and
surrender of this Note at the designated corporate trust office of U.S. Bank
Trust National Association in New York, New York, as trustee, or its successor
(the “Trustee”).  Interest on this Note
is payable by



 A-2
 









wire transfer in
immediately available funds to the Person in whose name this Note is registered
and at the address shown on the Record Date on the note registration books kept
by the Trustee as registrar for the Notes to the bank account number on file
with the Paying Agent as of the Record Date upon written request therefor by
the owner thereof for the appropriate Interest Payment.


EXCEPT
AS OTHERWISE PROVIDED IN SECTION 2.11 OF THE INDENTURE, THIS NOTE MAY BE
TRANSFERRED, IN WHOLE BUT NOT IN PART, ONLY TO ANOTHER NOMINEE TO THE NOTE
DEPOSITORY (AS DEFINED IN THE INDENTURE) OR TO A SUCCESSOR NOTE DEPOSITORY OR
TO A NOMINEE OF A SUCCESSOR NOTE DEPOSITORY.


This Note has been issued
under and pursuant to the provisions of Indenture.


This Note is one of a
duly authorized issue of Notes of the Issuer known as “GMH Communities, LP
Notes, Series 2007” (the “Series 2007 Notes”) issued, executed and delivered by
the Issuer pursuant to and governed by the Indenture.


This Note is one of a
Series of fully registered notes of like tenor and effect.  The Notes are general obligations of the
Issuer, equally secured by a lien on and pledge of all monies and securities
held by the Trustee under the Indenture applicable to the Notes and earnings
thereon (except amounts in the Cost of Issuance Fund created under the
Indenture).


Reference is hereby made
to the Indenture for a description of the provisions, among others, with
respect to the custody and application of the proceeds of the Notes issued
under the Indenture, the funds charged with and pledged to the payment of the
principal of and interest on the Notes, the rights, duties and obligations of
the Issuer and of the Trustee, the rights of the owners of the Notes and the
provisions regulating the manner in which the terms of the Indenture, this Note
and the rights of the owner hereof may be modified, to all of which provisions
the owner of this Note, on behalf of such owner and its successors in interest,
assents by acceptance hereof. 
Capitalized terms used herein and not defined have the meanings assigned
to such terms in the Indenture.  Copies
of the Indenture are on file at the designated corporate trust office of the
Trustee.


This Note shall bear
interest from its Dated Date at a variable rate of interest calculated in
accordance with the Indenture.


The Notes are issuable
only in the form of fully registered notes without coupons.  The Notes are issuable in denominations of
U.S. $100,000 and integral multiples of U.S. $5,000 in excess thereof.  The Notes are transferable only to a
permitted transferee in accordance with the terms of the Note Purchase
Agreement, by presentation for transfer or exchange at the designated corporate
trust office of the Trustee in New York, New York.  In each case, the Trustee may charge a sum
sufficient to cover any expense incurred in making such transfer or exchange,
and the Trustee may require payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto.  Upon the surrender thereof at the designated
corporate trust office of the Trustee with a written instrument of transfer, in
form and with guarantee of signature satisfactory to the Trustee and satisfying
the requirements of the Note



 A-3
 









Purchase
Agreement, duly executed by the Registered Owner or his duly authorized
attorney, Notes may, at the option of the Registered Owner thereof, be
exchanged for an equal aggregate principal amount of Notes of the same maturity
and interest rate of any other Authorized Denomination.  The Trustee shall be supplied with the name,
address, social security number or taxpayer identification number of the
transferee hereof prior to making such transfer.


The Issuer and the
Trustee shall not be required (a) to issue, transfer or exchange any Notes
during a period beginning on the date which is fifteen (15) days prior to the
day on which the applicable notice of redemption is given and ending on the
redemption date, or (b) to transfer or exchange any Notes selected, called or
being called for redemption or purchase in whole or in part.  If the Trustee establishes a special record
date, it shall provide notice by first-class mail to registered owners of all
Notes Outstanding at least ten (10) days before such special record date or at
such other time and manner as the Trustee may deem appropriate.


The Issuer and the
Trustee shall deem and treat the person in whose name this Note is registered
as the absolute owner hereof (whether or not this Note shall be overdue) for
the purpose of receiving payment of or on account of principal hereof and
interest due hereon and for all other purposes, and neither the Issuer nor the
Trustee shall be affected by any notice to the contrary.


This Note is subject to
optional redemption as described in the Indenture.


A COMPLETE STATEMENT AND
DESCRIPTION OF ALL REDEMPTION PROVISIONS APPLICABLE TO THE NOTES IS CONTAINED
IN THE INDENTURE, TO WHICH REFERENCE IS HEREBY MADE AND WHICH SHOULD BE
REVIEWED.


The owner of this Note
shall have no right to enforce the provisions of the Indenture or to institute
action to enforce the covenants therein, or to take any action with respect to
any event of default under the Indenture, or to institute, appear in or defend
any suit or other proceeding with respect thereto, except as provided in the
Indenture.  The Indenture prescribes the
manner in which it may be discharged, including a provision that the Notes
shall be deemed to be paid if monies or Defeasance Obligations, as defined
therein, maturing as to principal and interest in such amounts and at such
times as will provide sufficient funds to pay the Obligations of the Issuer,
including but not limited to, the principal of and interest on the Notes and
all necessary and proper fees of compensation and expenses of the Trustee and
the Initial Owner and the Issuer shall have been deposited with the Trustee,
after which the Notes shall no longer be secured by or entitled to the benefits
of the Indenture, except for the purposes of exchange of Notes and of any such
payment from such monies or Defeasance Obligations.


The Indenture permits,
with certain exceptions as therein provided permitting supplemental indentures
without consent of owners of the Notes, the amendment thereof and the
modification of the rights and obligations of the Issuer and the rights of the
owners of the Notes at any time by the Issuer with consent of the owners of
two-thirds in aggregate principal amount of the Notes at the time Outstanding,
as defined in the Indenture.  Any such
consent or waiver by the owner of this Note shall be conclusive and binding
upon such owner and upon all future owners of this Note and of any Note issued
upon the transfer or exchange of this Note, whether or not notation of such
consent or waiver is made upon this Note. 
The Indenture also contains



 A-4
 









provisions
permitting the Trustee to waive certain past defaults under the Indenture and
their consequences.


The Issuer hereby
certifies, recites and declares that all acts, conditions and things required
to exist, happen and be performed precedent to the execution and delivery of
the Indenture and issuance of this Note, do exist, have happened and have been
performed in due time, form and manner as required by law.


This Note shall not be
valid or become obligatory for any purpose or be entitled to any security or
benefit under the Indenture until the certificate of authentication hereon
shall have been dated and signed by the Trustee.


IN WITNESS WHEREOF, GMH
Communities, LP has caused this Note to be duly executed in its name by the
manual or facsimile signature of the Senior Vice President of its General
Partner.


	
   

  	
  GMH COMMUNITIES, LP, a Delaware limited partnership

  
	
   

  	
   

  
	
   

  	
  By:

  	
  GMH COMMUNITIES GP TRUST, a Delaware 

  
	
   

  	
     statutory trust, its general
  partner

  
	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:  Joseph
  Macchione

  
	
   

  	
   

  	
  Title:  Vice
  President

  
					



 



 A-5














CERTIFICATE
OF AUTHENTICATION


This Note is one of the
notes of the issue described in the within-mentioned Indenture.


Date of Authentication:


	
  

  	
  U.S. BANK TRUST NATIONAL

      ASSOCIATION, as Trustee

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:  Thomas
  Tabor

  	 

	
   

  	
  Title:  Vice
  President

  	 

					



 
















EXHIBIT B



CLOSING STATEMENT


Upon receipt of
immediately available funds for the purchase of the Issuer’s first Drawing by
the Initial Owner in the amount of $90,705,000, the Trustee shall immediately
deliver a check or otherwise transfer by wire payment funds from the Issuer’s
first Drawing as follows:  (a)
$89,772,897.65 to Wachovia Bank, National Association, as per the wiring
instructions below, from the Note Proceeds Fund, and (b) to Merrill Lynch,
Pierce, Fenner & Smith, Inc. as per the wiring instructions set forth
below, all funds in the Costs of Issuance Fund.


Wiring funds to Merrill Lynch:


	
  Bank Name:

  	
  JP Morgan Chase

  
	
  ABA No.:

  	
  021 000 021

  
	
  Further Credit to:

  	
  046-21114

  
	
  Credit to:

  	
  MLPF&S

  
	
  Account No.:

  	
  930-4019-012

  
	
  Reference:

  	
  CUSIP 36188TAA2 Commitment Fee

  



 


Wiring funds to Wachovia Bank:


	
  Bank Name:

  	
  Wachovia Bank, National Association

  
	
  ABA No.:

  	
  053000219

  
	
  Beneficiary Account
  Name: 

  	
  REIT

  
	
  Ref:

  	
  GMH Communities

  
	
  Account No.:

  	
  1459168116011

  
	
  ATTN:

  	
  Taylor Ahlstrom

  



 



 B-1














EXHIBIT
C



MILITARY HOUSING PROJECTS


1.                                      Fort
Stewart, Hinesville, Georgia / Hunter Army Airfield, Savannah, Georgia


2.                                      Fort
Carson, Colorado Springs, Colorado


3.                                      Fort
Hamilton, Brooklyn, New York


4.                                      Fort
Eustis, Newport News, Virginia / Fort Story, Virginia Beach, Virginia


5.                                      Water
Reed Army Medical Center, Washington, D.C. / Fort Dietrich, Fredrick, Maryland


6.                                      Fort
Bliss, Texas / White Sands Missile Range, Las Cruces, New Mexico


7.                                      Fort
Gordon, Augusta, Georgia


8.                                      Fort
Carlisle, Carlisle, Pennsylvania / Picatinny Arsenal, New Jersey


9.                                      Navy
Northeast - NSB New London Groton, Connecticut / NSY Portsmouth Shipyard
Kittery, Maine / NAS Brunswick, Brunswick, Maine / NAVSTA Newport Newport,
Rhode Island / NSU Saratoga Springs, Saratoga Springs, New York / Mitchell
Manor Long Island, New York / NWS Earle Colts Neck, New Jersey / NAES Lakehurst
Lakehurst, New Jersey


10.                               Air
Education and Training Command (AETC) - Altus AFB, Oklahoma / Luke AFB, Arizona
/ Sheppard AFB, Texas / Tyndell AFB, Florida


11.                               Navy
Southeast Region comprised of eleven (11) bases


12.                               U.S.
Military Academy at West Point, New York



 C-1















EXHIBIT
D



FORM OF NOTICE OF DRAWING


              ,
200  


                          


Ladies and Gentlemen:


The undersigned,       of
GMH Communities, LP (“Issuer”), acting pursuant to a Trust Indenture dated as
of May 7, 2007 (the “Indenture”), by and between the Issuer and U.S. Bank
National Trust Association, as trustee (the “Trustee”), hereby delivers to you,
as Trustee under the Indenture, this request for a drawing, on the date hereof,
under the Issuer’s Taxable Notes Series 2007 (the “Notes”) in an aggregate
principal amount of $            
(the “Drawing”) for the purpose of             .  The Notes are dated             
and conform to the specifications with respect thereto set forth in the
Indenture.  $            
cumulative principal amount of Notes have been drawn down by the Issuer prior
to the date hereof, and $            
principal amount of Notes are outstanding on the date hereof.


Upon your receipt
of a federal funds wire, for the account of the Issuer, in the amount of $            ,
representing the purchase price for the Drawing, you hereby are requested and
authorized to (a) revise the Schedule of Drawings and Redemptions attached to
the Indenture reflecting such Drawing, and (b) to deposit the proceeds
from such Drawing into the Note Proceeds Fund. 
Thereafter, you are hereby directed to transfer the proceeds from such
Drawing to the Issuer as [directed by Issuer in this letter] or as set forth in
the Indenture.



 D-1














Your
acknowledgement that you have received this Notice of Drawing in accordance
with the provisions of the Indenture will be evidenced by your receipt,
acceptance and approval as hereon endorsed.


GMH COMMUNITIES, LP, a Delaware limited partnership


	
  

  	
  By:

  	
  GMH COMMUNITIES GP TRUST, a Delaware

  
	
   

  	
    statutory trust, its general partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:  Joseph Macchione

  
	
   

  	
   

  	
  Title:  Vice President

  
					



 


Receipt,
acceptance and approval of the foregoing are hereby acknowledged.  The undersigned also acknowledges that all
actions on its part requested by the Issuer have been undertaken.


	
  

  	
  U.S. BANK TRUST NATIONAL

  ASSOCIATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Name:  Thomas E. Tabor

  
	
   

  	
   

  	
  Title:  Vice President

  



 















EXHIBIT
E



SCHEDULE OF DRAWINGS AND REDEMPTIONS


	
  Date of 

  Drawing/Redemption

  	
   

  	
  Amount of 

  Drawing

  	
   

  	
  Amount of 

  Redemption

  	
   

  	
  Cumulative 

  Outstanding

  Principal Amount

  	
   

  	
  Amount of Available 

  Principal (including 

  Additional Notes)

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  



 



 E-1














EXHIBIT
F



AUDITED FINANCIAL STATEMENTS



 F-1














EXHIBIT
G



PLEDGED ACCOUNTS


	
  Name of
  Account Holder

  	
   

  	
  Name of Entity Holding 

  Account (and Office)

  	
   

  	
  Account Number

  
	
  GMH Military Hou_005

  	
   

  	
  Merrill Lynch

  	
   

  	
  21607005

  
	
  GMH Military Housing FC

  	
   

  	
  Merrill Lynch

  	
   

  	
  21607048

  
	
  GMH Military Housing Development LLC

  	
   

  	
  Merrill Lynch

  	
   

  	
  21607039

  
	
  GMH Military Housing MGT FC

  	
   

  	
  Merrill Lynch

  	
   

  	
  21607116

  
	
  GMH Military Housing Renovations Account

  	
   

  	
  Merrill Lynch

  	
   

  	
  21607275

  
	
  GMH Military Housing Renovations Account

  	
   

  	
  Merrill Lynch

  	
   

  	
  21607276

  
	
  GMH Military Housing Renovations Account

  	
   

  	
  Merrill Lynch

  	
   

  	
  21607277

  
	
  GMH Military Housing Renovations Account

  	
   

  	
  Merrill Lynch

  	
   

  	
  21607278

  
	
  GMH Military Housing Renovations Account

  	
   

  	
  Merrill Lynch

  	
   

  	
  21607068

  
	
  GMH/AETC Management/Development LLC

  	
   

  	
  Merrill Lynch

  	
   

  	
  21607361

  
	
  GMH NE Housing Design/Build LLC

  	
   

  	
  Merrill Lynch

  	
   

  	
  21607205

  



 



 G-1















EXHIBIT
H



CLOSING PROFORMA



 H-1
 









SCHEDULE
4.06


1.  In re: GMH Communities Trust Securities
Litigation.  Consolidated class
action lawsuit claiming fraudulent SEC filings by GMH.  More details of this litigation are set forth
in GMH’s filings with the SEC, which are incorporated herein by this reference.


2.  Forbes lawsuit.  Plaintiffs allege that GMH provided false and
misleading financial information.  This
suit is similar to No. 1, above. The plaintiffs were not included in the class
action suit because they are unit holders and not shareholders.  More details of this litigation are set forth
in GMH’s filings with the SEC, which are incorporated herein by this reference.


3.  Jeffrey M. Brown Associates, Inc. (“JMB”).  On
November 9, 2006, JMB (the construction contractor for the Fort Hamilton
project) presented a claim in the amount of approximately $8 million for extra
costs above the guaranteed maximum price for its contract.  The majority of the claim (approximately $7.9
million) relates to asserted post-contract adjustments in the scope of work and
the withdrawal of the proposed modular home supplier. Management disputed the
claim but agreed to meet with JMB to discuss the claim and possible
settlements. On January 18, 2007, JMB proposed a settlement that would involve
a change order to increase the Guaranteed Maximum Price for new construction at
Fort Hamilton by approximately $1.7 million and the cessation of further
renovation work by JMB at both Fort Hamilton and the Mitchel Manor portion of
the Navy Northeast project, where JMB is a subcontractor.  As part of this proposed settlement, JMB
would retract approximately $6.3 million of its original claim.  On February 23, 2007, GMH Military Housing
issued a letter back to JMB, in response to its prior settlement proposal,
indicating the company’s counteroffer for potential settlement terms between
the parties.  Any settlement is likely
subject to approval by the Army and the financing parties for Fort Hamilton,
and possibly the Navy and the financing parties for the Navy Northeast project
if the settlement also involves JMB’s work for the Navy Northeast project.  In April, 2007, JMB submitted change orders
in the amount of approximately $990,000 and they are under consideration by
management.  However, management believes
that the change orders are without merit. 
At this time, management believes that an agreement will be reached with
JMB if the other necessary parties consent. In addition, JMB holds a renovation
contract for work to be completed at the project.  GMH plans to assume the remaining renovation
contract under a revised scope that is to be approved by the appropriate
financing parties.  If an agreement is
not reached, and JMB were to file suit and prevail against the Fort Hamilton
project entity, GMH Communities LP could potentially become liable under the
Guaranty of Completion covering the project, which is discussed below.  The project entity also could be liable apart
from the completion guaranty, given that the project entity is the party to the
construction contract with JMB.


Guaranty of Completion: A Guaranty of Completion exists between GMH Communities LP, as
guarantor (through assignment of rights and obligations from GMH Capital
Partners, L.P.), in favor of The Bank of New York as master trustee under the
Trust Indenture covering the bonds financing the Fort Hamilton project.  Under the terms of this Guaranty, the
guarantor has guaranteed that the project will be fully and timely performed
and completed in accordance with the plans/specifications, “Guaranteed Maximum
Price” and construction schedule as set out in the related project construction
contract. In addition, the project entity has the same obligations 



 H-2
 









to
complete the construction schedule under the terms of the Trust Indenture.  Management believes that any change order
increasing the Guaranteed Maximum Price of JMB’s construction contract as part
of the settlement will result in a corresponding increase to the Guaranteed
Maximum Price for purposes of the Guaranty because the definition of Guaranteed
Maximum Price in the Guaranty is tied to JMB’s construction contract.  Moreover, because any settlement and change
order with JMB would likely require the consent of the financing parties for
Fort Hamilton, management intends to document any such consent in a manner that
would provide a corresponding increase in the Guaranteed Maximum Price for
purposes of the Guaranty.  However, if a
settlement with JMB is not reached and JMB were to prevail on its claim, it is
possible that GMH Communities LP would be liable for the amount of the claim
above the Guaranteed Maximum Price.


4.  Northeast Housing LLC v. Pezza CMS, Inc.  In 2005, GMH Military Housing Management
entered into several contracts with Pezza CMS, Inc. (“Pezza”), a construction
contractor, to perform renovation work for the Navy NE project in Connecticut
and Rhode Island.  Pezza failed to complete those projects and also failed
to pay its subcontractors; therefore GMH terminated the contracts in April,
2006.  GMH paid the unpaid subcontractors all sums owed by Pezza
(approximately $283k) so that the subcontractors would not file mechanics leans
against the properties.  In addition, GMH hired new contractors to finish
the work for about $200k.


In retaliation for GMH
terminating its contracts, Pezza filed an Intent to File Mechanics Liens in RI
and CT.  GMH received lien waivers for all of the work performed by Pezza
and has paid either Pezza or its subcontractors for all work performed;
therefore the risk of Pezza actually perfecting the liens and successfully
collecting on the liens is minimal.


In Rhode Island, Pezza
had to act within 3 months of filing the Intent to Lien to perfect its lien
position.  Pezza failed to do so, causing its Intent to Lien and any
future opportunity to lien the property for this work to be relinquished.


In Connecticut, Pezza has
to act within 1 year of filing the Intent to Lien to perfect its lien position.
 This time period will run off in about four months.  Pezza has
indicated in its Intent To File Liens that it intends to file liens in the
amount of $230,921.93.  GMH has entered into an escrow agreement placing
the full amount of the liens in escrow pending the outcome of litigation
against Pezza (which should result in the liens being expunged).


GMH filed a complaint
against Pezza on October 26, 2006 seeking compensation from Pezza of over
$1,000,000 for (i) the amount paid to subcontractors ($283k), (ii) the amount
paid contractors to finish the work ($200k), (iii) lost rental because of the
delay caused by Pezza ($583k), plus (iv) attorneys fees.  The complaint
also seeks to eliminate the CT Intent to File Mechanics Liens.  The case
is now in the discovery phase of this litigation.


The CT liens will be
relinquished in four months if Pezza does not take any action to perfect its
liens.  This 1-year CT hurdle will occur prior to the court making any
decision on the liens.  The court will not have to act to relinquish the
liens if the 1-year mark comes and goes without Pezza filing its liens. 
Then, what will remain in the complaint is GMH’s action for damages.



 H-3
 









5.  West Point:  Subsidiaries of the Issuer are engaged in
defending a protest filed at the Government Accountability Office by Forest
City Military Communities LLC with respect to the West Point Military Housing
Project.  Forest City has asked the GAO
to review whether the U.S. Army properly implemented the evaluation scheme
under the Army’s solicitation when it selected GMH for the West Point
project.  An outcome is expected on or
before July 5, 2007.  A determination in
support of Forest City could result in the loss of the West Point project.



 H-4
 









SCHEDULE
5.02


1.  Navy Northeast.


There
are a number of provisions under the Project Documents for the Navy Northeast
project that could not be met as a result of construction delays implemented
upon notice of the BRAC determinations. Management has been working with the
Navy, its construction partners and the bondholder parties since the BRAC
announcements to ensure that decisions to delay construction work at certain
sites under the project were done with full knowledge of all third parties (and
that such third parties were given the opportunity to object to any such
actions before they were taken). The project entity has distributed notices to
relevant third parties regarding the construction delays, and has included
references to the construction delays in numerous draw requests submitted to
the trustee and bondholder representative throughout 2006. Each of these draw
requests have been subsequently approved by the requisite parties, despite this
indication of the construction stoppage and the attendant implication that
constructions requirements under the transaction documents would continue to be
“off-schedule” going forward.


The
Managing Member of the Navy Northeast project is in the process of negotiating
the terms of a re-financing of the outstanding bond issuance on behalf of the
joint venture with the Navy, together with an amendment and restatement of all
related project documents that will incorporate necessary changes to reduce the
project scope in line with the BRAC-affected sites. Currently, management
expects that a proposal to re-finance the outstanding bonds will be distributed
to bondholders in May, and that a closing on the re-financing and complete
amendment/restatement of the project documents will be completed during the
third quarter of 2007.  The legal
documents to be amended and restated in connection with the restructuring,
including the Trust Indenture, have been prepared in draft form by the project
entity’s legal counsel and have been under review by the Navy’s counsel as
well.


Trust
Indenture: In the
meantime, the project entity is currently in default of the terms of the Trust
Indenture, which required that a certain number of new housing units be
constructed by December 31, 2006.  In
addition, the project entity has not met, and is expected to continue not to
meet, the various construction/renovation deadlines contained in schedules to
the Design/Build Agreement covering the project.  Upon the trigger of an event of default under
the terms of the Trust Indenture, the bondholders may exercise various
remedies, including the right to declare the full principal of all bonds
outstanding and interest accrued thereon and the “make whole premium,” if any,
immediately due and payable. This right to accelerate the bond payments is
provided under Section 8.02 of the Trust Indenture and requires the Trustee to
provide written notice upon the request of a majority of the bondholders.
Management has been in contact with the trustee, the bondholder representative,
and (through the investment bankers engaged in connection with the
re-financing) the holders of a majority of the outstanding bonds. Each of these
parties has been aware of the continuing construction/renovation stoppages at
BRAC-affected sites and is awaiting additional information on the proposed
terms of the project re-financing. Management has received no indication of
intent by the bondholders to accelerate the bonds.



 H-5
 









In
connection with draw requests, the project owner is required to submit a
compliance certificate that effectively brings-down each of the representations
and warranties under the Trust Indenture as of the date of the draw request.
Given the default under certain sections of the Trust Indenture, compliance
certificates have been modified to indicate that the project owner is not in
compliance with the representation of Section 4.38 of the Trust Indenture.
While the trustee approves the draw requests, the bondholder representative
directs the trustee whether to approve or disapprove a draw request. The
bondholder representative approved the most recent draw request, and based on
management’s discussions with the bondholder representative, management expects
the bondholder representative to continue approving draw requests pending
restructuring the project.


Completion
Guaranty: Under the
terms of this document, GMH Communities, LP has provided a guaranty in favor of
the Department of the Navy to perform and complete (i) the design build manager’s
obligations under the Design/Build Agreement, as well as (ii) certain
obligations of the project owner, including the payment of up to $5.0 million
in operating deficits under the Trust Indenture. The Guaranty provides that so
long as the design/build manager performs its obligations under the
Design/Build Agreement in accordance with its terms, that the Guarantor shall
have no obligation under the Guaranty with respect to the design/build terms;
and if the project owner pays the costs described in the definition of “owner
obligations” then Guarantor also shall have no obligation under the Guaranty
with respect to the “owner obligations.” So long as a default exists under the
terms of the Design/Build Agreement, the Guarantor will be responsible for
completion and performance of the work under that agreement. As discussed
above, the current construction/renovation scope and timing for performance of
construction/renovation is expected to be modified under the Design/Build
Agreement in connection with the project restructuring. In addition, with
respect to payment of any operating deficits under the Trust Indenture,
management is currently unaware of any such costs that are not otherwise being
paid for by the project owner.


Side
Letter:  On April 7, 2005, Northeast Housing, LLC (the
project entity) obtained approximately $2.9 million of funds from the project’s
account referred to as “ORA” (Operating Reserve Account) to cover a cash
shortfall under the project. The funds were used to make required interest
payments for the outstanding bonds under the Trust Indenture. Under the terms
of the side letter agreement, GMH Military Housing – Navy Northeast LLC (as
managing member of the project entity) requested that the ORA funds be
considered a loan by in accordance with the terms of the operating agreement
for the project owner, and that the loan carry a 0% interest rate and become
payable due subsequent to the development period under the operating agreement.


Management
is currently working to require the payment of the borrowed ORA funds by the
project owner in connection with the restructuring of the project. Based on
discussion with the Navy to date, this modification to the project documents
will be permitted. In the event that the project owner repays, or becomes
responsible for payment of, the previously borrowed ORA funds, then the
obligation of GMH Communities, LP to otherwise guaranty this “operating deficit”
will be excluded from the Guaranty.



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