exv10w33w4w5



 





Exhibit 10.33.4.5

EXECUTION COPY




 





CREDIT AGREEMENT




Dated as of April 10, 2007




by and among




ASHFORD HOSPITALITY LIMITED PARTNERSHIP,

as Borrower,




ASHFORD HOSPITALITY TRUST, INC.,

as Parent,




WACHOVIA CAPITAL MARKETS, LLC,

as Arranger,




WACHOVIA BANK, NATIONAL ASSOCIATION,

as Administrative Agent,

each of




MORGAN STANLEY SENIOR FUNDING, INC.

and

MERRILL LYNCH BANK USA,

as Co-Syndications Agents ,




each of




BANK OF AMERICA, N.A.

and

CALYON NEW YORK BRANCH,

as Co-Documentation Agents,




and




THE FINANCIAL INSTITUTIONS INITIALLY SIGNATORY HERETO

AND THEIR ASSIGNEES PURSUANT TO SECTION 12.5.,

as Lenders




 





 









 





TABLE OF CONTENTS




	 	 	 	 	 
	Article I. Definitions
	 	 	1	 
	 
	 	 	 	 
	Section 1.1. Definitions
	 	 	1	 
	Section 1.2. General; References to Times
	 	 	25	 
	Section 1.3. Financial Attributes of Non-Wholly Owned Subsidiaries
	 	 	26	 
	 
	 	 	 	 
	Article II. Credit Facility
	 	 	26	 
	 
	 	 	 	 
	Section 2.1. Revolving Loans
	 	 	26	 
	Section 2.2. Term Loans
	 	 	28	 
	Section 2.3. Letters of Credit
	 	 	29	 
	Section 2.4. Rates and Payment of Interest on Loans
	 	 	33	 
	Section 2.5. Number of Interest Periods
	 	 	35	 
	Section 2.6. Repayment of Loans
	 	 	35	 
	Section 2.7. Prepayments
	 	 	35	 
	Section 2.8. Continuation
	 	 	36	 
	Section 2.9. Conversion
	 	 	36	 
	Section 2.10. Notes
	 	 	37	 
	Section 2.11. Voluntary Reductions of the Revolving Commitment
	 	 	38	 
	Section 2.12. Extension of Revolving Termination Date and Term Loan
Maturity Date
	 	 	38	 
	Section 2.13. Expiration or Maturity Date of Letters of Credit Past
Revolving Termination Date
	 	 	40	 
	Section 2.14. Amount Limitations
	 	 	40	 
	 
	 	 	 	 
	Article III. Payments, Fees and Other General Provisions
	 	 	40	 
	 
	 	 	 	 
	Section 3.1. Payments
	 	 	40	 
	Section 3.2. Pro Rata Treatment
	 	 	40	 
	Section 3.3. Sharing of Payments, Etc.
	 	 	41	 
	Section 3.4. Several Obligations
	 	 	42	 
	Section 3.5. Minimum Amounts
	 	 	42	 
	Section 3.6. Fees
	 	 	42	 
	Section 3.7. Computations
	 	 	44	 
	Section 3.8. Usury
	 	 	44	 
	Section 3.9. Agreement Regarding Interest and Charges
	 	 	44	 
	Section 3.10. Statements of Account
	 	 	44	 
	Section 3.11. Defaulting Lenders
	 	 	45	 
	Section 3.12. Taxes
	 	 	46	 
	 
	 	 	 	 
	Article IV. Yield Protection, Etc.
	 	 	48	 
	 
	 	 	 	 
	Section 4.1. Additional Costs; Capital Adequacy
	 	 	48	 
	Section 4.2. Suspension of LIBOR Loans
	 	 	49	 
	Section 4.3. Illegality
	 	 	49	 
	Section 4.4. Compensation
	 	 	50	 
	Section 4.5. Affected Lenders
	 	 	50	 






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	Section 4.6. Treatment of Affected Loans
	 	 	51	 
	Section 4.7. Change of Lending Office
	 	 	51	 
	Section 4.8. Assumptions Concerning Funding of LIBOR Loans
	 	 	51	 
	 
	 	 	 	 
	Article V. Conditions Precedent
	 	 	52	 
	 
	 	 	 	 
	Section 5.1. Initial Conditions Precedent
	 	 	52	 
	Section 5.2. Conditions Precedent to All Loans and Letters of Credit
	 	 	55	 
	 
	 	 	 	 
	Article VI. Representations and Warranties
	 	 	56	 
	 
	 	 	 	 
	Section 6.1. Representations and Warranties
	 	 	56	 
	Section 6.2. Survival of Representations and Warranties, Etc.
	 	 	61	 
	 
	 	 	 	 
	Article VII. Affirmative Covenants
	 	 	62	 
	 
	 	 	 	 
	Section 7.1. Preservation of Existence and Similar Matters
	 	 	62	 
	Section 7.2. Compliance with Applicable Law
	 	 	62	 
	Section 7.3. Maintenance of Property
	 	 	62	 
	Section 7.4. Conduct of Business
	 	 	63	 
	Section 7.5. Insurance
	 	 	63	 
	Section 7.6. Payment of Taxes and Claims
	 	 	63	 
	Section 7.7. Visits and Inspections
	 	 	63	 
	Section 7.8. Use of Proceeds; Letters of Credit
	 	 	64	 
	Section 7.9. Environmental Matters
	 	 	64	 
	Section 7.10. Books and Records
	 	 	64	 
	Section 7.11. Further Assurances
	 	 	65	 
	Section 7.12. Additional Guarantors and Pledges
	 	 	65	 
	Section 7.13. Release of Guarantors and Pledges
	 	 	66	 
	Section 7.14. REIT Status
	 	 	66	 
	Section 7.15. Exchange Listing
	 	 	66	 
	 
	 	 	 	 
	Article VIII. Information
	 	 	67	 
	 
	 	 	 	 
	Section 8.1. Quarterly Financial Statements
	 	 	67	 
	Section 8.2. Year-End Statements
	 	 	67	 
	Section 8.3. Compliance Certificate
	 	 	67	 
	Section 8.4. Other Information
	 	 	68	 
	Section 8.5. Electronic Delivery of Certain Information
	 	 	69	 
	Section 8.6. Public/Private Information
	 	 	71	 
	 
	 	 	 	 
	Article IX. Negative Covenants
	 	 	71	 
	 
	 	 	 	 
	Section 9.1. Financial Covenants
	 	 	71	 
	Section 9.2. Restricted Payments
	 	 	72	 
	Section 9.3. Indebtedness
	 	 	72	 
	Section 9.4. Certain Permitted Investments
	 	 	72	 
	Section 9.5. Investments Generally
	 	 	72	 
	Section 9.6. Liens; Negative Pledges; Other Matters
	 	 	73	 
	Section 9.7. Merger, Consolidation, Sales of Assets and Other Arrangements
	 	 	74	 
	Section 9.8. Fiscal Year
	 	 	74	 






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	Section 9.9. Modifications of Organizational Documents
	 	 	74	 
	Section 9.10. Transactions with Affiliates
	 	 	75	 
	Section 9.11. ERISA Exemptions
	 	 	75	 
	 
	 	 	 	 
	Article X. Default
	 	 	75	 
	 
	 	 	 	 
	Section 10.1. Events of Default
	 	 	75	 
	Section 10.2. Remedies Upon Event of Default
	 	 	79	 
	Section 10.3. Remedies Upon Default
	 	 	80	 
	Section 10.4. Allocation of Proceeds
	 	 	80	 
	Section 10.5. Collateral Account
	 	 	81	 
	Section 10.6. Performance by Agent
	 	 	82	 
	Section 10.7. Rights Cumulative
	 	 	82	 
	 
	 	 	 	 
	Article XI. The Agent
	 	 	82	 
	 
	 	 	 	 
	Section 11.1. Authorization and Action
	 	 	82	 
	Section 11.2. Agent’s Reliance, Etc
	 	 	83	 
	Section 11.3. Notice of Defaults
	 	 	84	 
	Section 11.4. Wachovia as Lender
	 	 	84	 
	Section 11.5. Approvals of Lenders
	 	 	84	 
	Section 11.6. Lender Credit Decision, Etc
	 	 	85	 
	Section 11.7. Indemnification of Agent
	 	 	86	 
	Section 11.8. Successor Agent
	 	 	86	 
	Section 11.9. Titled Agents
	 	 	87	 
	 
	 	 	 	 
	Article XII. Miscellaneous
	 	 	87	 
	 
	 	 	 	 
	Section 12.1. Notices
	 	 	87	 
	Section 12.2. Expenses
	 	 	88	 
	Section 12.3. Setoff
	 	 	89	 
	Section 12.4. Litigation; Jurisdiction; Other Matters; Waivers
	 	 	89	 
	Section 12.5. Successors and Assigns
	 	 	90	 
	Section 12.6. Amendments
	 	 	93	 
	Section 12.7. Nonliability of Agent and Lenders
	 	 	95	 
	Section 12.8. Confidentiality
	 	 	95	 
	Section 12.9. Indemnification
	 	 	96	 
	Section 12.10. Termination; Survival
	 	 	99	 
	Section 12.11. Severability of Provisions
	 	 	99	 
	Section 12.12. GOVERNING LAW
	 	 	99	 
	Section 12.13. Patriot Act
	 	 	99	 
	Section 12.14. Counterparts
	 	 	100	 
	Section 12.15. Obligations with Respect to Loan Parties
	 	 	100	 
	Section 12.16. Limitation of Liability
	 	 	100	 
	Section 12.17. Entire Agreement
	 	 	100	 
	Section 12.18. Construction
	 	 	100	 






	 	 	 
	SCHEDULE I

	 	Commitments
	SCHEDULE 1.1.(A)

	 	Acquisition Portfolio






- iii -









 






	 	 	 
	SCHEDULE 1.1.(B)

	 	List of Grantors
	SCHEDULE 1.1.(C)

	 	List of Loan Parties
	SCHEDULE 1.1.(D)

	 	List of Pledgors
	SCHEDULE 6.1.(b)

	 	Ownership Structure
	SCHEDULE 6.1.(f)

	 	Title to Properties; Liens
	SCHEDULE 6.1.(g)

	 	Existing Indebtedness
	SCHEDULE 9.10.

	 	Transactions with Affiliates
	 
	 	 
	EXHIBIT A

	 	Form of Assignment and Assumption
	EXHIBIT B

	 	Form of Notice of Borrowing
	EXHIBIT C

	 	Form of Notice of Continuation
	EXHIBIT D

	 	Form of Notice of Conversion
	EXHIBIT E

	 	Form of Pledge Agreement
	EXHIBIT F

	 	Form of Security Agreement
	EXHIBIT G

	 	Form of Revolving Note
	EXHIBIT H

	 	Form of Term Note
	EXHIBIT I

	 	Form of Opinion of Counsel
	EXHIBIT J

	 	Form of Compliance Certificate
	EXHIBIT K

	 	Form of Guaranty






- iv -









 






     THIS CREDIT AGREEMENT (this “Agreement”) dated as of April 10, 2007 by and among ASHFORD
HOSPITALITY LIMITED PARTNERSHIP, a limited partnership formed under the laws of the State of
Delaware (the “Borrower”), ASHFORD HOSPITALITY TRUST, INC. a corporation formed under the laws of
the State of Maryland (the “Parent”), WACHOVIA CAPITAL MARKETS, LLC, as Arranger (the “Arranger”),
each of MORGAN STANLEY SENIOR FUNDING, INC. and MERRILL LYNCH BANK USA, as Co-Syndication Agents
(the “Co-Syndication Agents”), BANK OF AMERICA, N.A. and CALYON NEW YORK BRANCH, as
Co-Documentation Agents (the “Co-Documentation Agents”), WACHOVIA BANK, NATIONAL ASSOCIATION, as
Agent, and each of the financial institutions initially a signatory hereto together with their
assignees pursuant to Section 12.5.(b).



     WHEREAS, Ashford Sapphire Acquisition LLC, a Wholly Owned Subsidiary (as defined below) of the
Borrower (the “Acquisition Subsidiary”), has entered into that certain Agreement and Plan of Merger
dated as of January 18, 2007 (as amended, restated, supplemented or otherwise modified from time to
time, the “Merger Agreement”) by and among MS Resort Holdings, LLC, MS Resort Acquisition LLC, MS
Resort Purchaser LLC, the Acquisition Subsidiary and CNL Hotels & Resorts, Inc. (the “Seller”),
which provides for the acquisition (the “Acquisition”) by the Acquisition Subsidiary of the
Acquisition Portfolio (as defined below), either by direct transfer of the Properties comprising
the Acquisition Portfolio or through the acquisition, directly or indirectly, of certain of the
Equity Interests of each Person that owns any Property comprising the Acquisition Portfolio;



     WHEREAS, the Acquisition is to be effected in accordance with the terms of that certain
Purchase and Sale Agreement dated as of January 18, 2007 (as amended, restated, supplemented or
otherwise modified from time to time, the “Asset Purchase Agreement”) by and between the
Acquisition Subsidiary and the Seller;



     WHEREAS, to finance a portion of the cost of the Acquisition and for the other purposes
permitted by this agreement, the Borrower has requested the Agent and the Lenders to make available
to the Borrower credit facilities in the aggregate principal amount of $525,000,000 in the form of
(a) a revolving credit facility in the initial amount of $200,000,000, which will include a
$50,000,000 letter of credit subfacility, and (b) a term loan facility in an amount of up to
$325,000,000; and



     WHEREAS, the Agent and the Lenders are willing to make such credit facilities available to the
Borrower on the terms and conditions contained herein.



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



Article I. Definitions




Section 1.1. Definitions.




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



 









 





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



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



     “Acquisition Portfolio” means the Properties described on Schedule 1.1.(A).



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



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



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



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



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



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



     “Affiliate” means, with respect to a specified Person, another Person that directly, or
indirectly through one or more intermediaries, Controls or is Controlled by or is under common
Control with the Person specified. In no event shall the Agent or any Lender be deemed to be an
Affiliate of the Borrower.



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



     “Aggregate Exposure” means, with respect to any Lender at any time, an amount equal to the sum
of (a) the principal amount of the Term Loan, if any, of such Lender, plus (b) the amount of the
Revolving Commitment, if any, of such Lender then in effect or, if at the time of determination the
Revolving Commitments have terminated or been reduced to zero, the



- 2 -









 




principal amount of the aggregate outstanding Revolving Loans and Letter of Credit Liabilities, if
any, of such Lender.




     “Aggregate Exposure Percentage” means, with respect to any Lender at any time, the ratio
(expressed as a percentage) of such Lender’s Aggregate Exposure at such time to the sum of the
Aggregate Exposures of all Lenders at such time.



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



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



     “Applicable Margin” means:



     (a) with respect to the Revolving Loans, the percentage set forth below corresponding to the
ratio of Total Net Indebtedness to Total Asset Value (excluding cash and cash equivalents) as
determined in accordance with Section 9.1. in effect at such time:



	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Total Net Indebtedness to	 	Applicable Margin for	 	Applicable Margin for
	Level	 	Total Asset Value	 	LIBOR Loans	 	Base Rate Loans
	 
	 	1	 	 	< 0.50 to 1.00
	 	 	1.55	%	 	 	0.50	%
	 	2	 	 	> 0.50 to 1.00 and < 0.60 to 1.00
	 	 	1.65	%	 	 	0.75	%
	 	3	 	 	> 0.60 to 1.00 and < 0.70 to 1.00
	 	 	1.75	%	 	 	1.00	%
	 	4	 	 	> 0.70 to 1.00
	 	 	1.95	%	 	 	1.25	%





The Applicable Margin for Revolving Loans shall be determined by the Agent from time to time
as provided above, based on the ratio of Total Net Indebtedness to Total Asset Value (excluding
cash and cash equivalents) as set forth in the Compliance Certificate most recently delivered by
the Parent pursuant to Section 8.3. Any necessary adjustment to the Applicable Margin for
Revolving Loans shall be effective (a) in the case of a Compliance Certificate delivered in
connection with quarterly financial statements of the Parent delivered pursuant to Section 8.1., as
of the date 50 days following the end of the last day of the applicable fiscal quarter covered by
such Compliance Certificate, and (b) in the case of a Compliance Certificate delivered in
connection with annual financial statements of the Parent delivered pursuant to Section 8.2., as of
the date 95 days following the end of the last day of the applicable fiscal year covered by such
Compliance Certificate. As of the Agreement Date, and thereafter until changed as provided above,
the Applicable Margin for Revolving Loans shall be determined based on Level 4 of the above table.
If the Borrower fails to deliver a Compliance Certificate pursuant to Section 8.3., the Applicable
Margin for Revolving Loans shall equal the percentages corresponding to Level 4 in the above table
until the date of the delivery of the required Compliance Certificate.




     (b) with respect to the Term Loans, (i) one-half of one percent (0.50%) in the case of Base
Rate Loans and (ii) one and one-half of one percent (1.50%) in the case of LIBOR Loans; provided,
however, if the Borrower exercises its right to extend the Term Loan Maturity Date pursuant to
Section 2.12., the Applicable Margin for Term Loans shall be determined as follows on and after the
effective date of such extension:



- 3 -









 






     (A) If the Borrower exercises its right to extend the Term Loan Maturity Date pursuant
to Section 2.12.(b) [Extension of Term Loan Maturity Date Without Rating], the Applicable
Margin for Term Loans shall equal the percentage set forth below corresponding to the ratio
of Total Net Indebtedness to Total Asset Value (excluding cash and cash equivalents) as
determined in accordance with Section 9.1. in effect at such time:



	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Total Net Indebtedness to	 	Applicable Margin for	 	Applicable Margin for
	Level	 	Total Asset Value	 	LIBOR Loans	 	Base Rate Loans
	 
	 	1	 	 	< 0.50 to 1.00
	 	 	1.40	%	 	 	0.40	%
	 	2	 	 	> 0.50 to 1.00 and < 0.60 to 1.00
	 	 	1.55	%	 	 	0.65	%
	 	3	 	 	> 0.60 to 1.00 and < 0.70 to 1.00
	 	 	1.65	%	 	 	0.90	%
	 	4	 	 	> 0.70 to 1.00
	 	 	1.85	%	 	 	1.15	%







The Applicable Margin for Term Loans shall be determined by the Agent from time to time
as provided above, based on the ratio of Total Net Indebtedness to Total Asset Value
(excluding cash and cash equivalents) as set forth in the Compliance Certificate most
recently delivered by the Parent pursuant to Section 8.3. Any necessary adjustment to the
Applicable Margin for Term Loans shall be effective (x) in the case of a Compliance
Certificate delivered in connection with quarterly financial statements of the Parent
delivered pursuant to Section 8.1., as of the date 50 days following the end of the last day
of the applicable fiscal quarter covered by such Compliance Certificate, and (y) in the case
of a Compliance Certificate delivered in connection with annual financial statements of the
Parent delivered pursuant to Section 8.2., as of the date 95 days following the end of the
last day of the applicable fiscal year covered by such Compliance Certificate. If the
Borrower fails to deliver a Compliance Certificate pursuant to Section 8.3., the Applicable
Margin for Term Loans shall equal the percentages corresponding to Level 4 in the above
table until the date of the delivery of the required Compliance Certificate.




     (B) If the Borrower exercises its right to extend the Term Loan Maturity Date pursuant
to Section 2.12.(c) [Extension of Term Loan Maturity Date With Rating], the Applicable
Margin for Term Loans shall equal the percentage determined, at any time, based on the range
into which the Parent’s Credit Rating then falls, in accordance with the Levels in the table
set forth below. Any change in the Parent’s Credit Rating which would cause it to move to a
different Level in such table shall effect a change in the Applicable Margin on the Business
Day on which such change occurs. During any period that the Parent has received Credit
Ratings that are not equivalent, the Applicable Margin for Term Loans shall be determined by
the lower of such two Credit Ratings. During any period for which the Parent has received a
Credit Rating from only one Rating Agency, then the Applicable Margin for Term Loans shall
be determined based on such Credit Rating. During any period for which the Parent has no
Credit Rating from either Rating Agency, then the Applicable Margin for Term Loans shall be
determined based on Level 5.



- 4 -









 





	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Parent’s Credit Rating	 	Applicable Margin for	 	Applicable Margin for
	Level	 	       (S&P/Moody’s)	 	LIBOR Loans	 	Base Rate Loans
	 
	 	1	 	 	BB+/Ba1 or higher
	 	 	1.50	%	 	 	0.50	%
	 	2	 	 	BB/Ba2
	 	 	1.75	%	 	 	0.75	%
	 	3	 	 	BB-/Ba3
	 	 	2.00	%	 	 	1.00	%
	 	4	 	 	B+/B1
	 	 	2.25	%	 	 	1.25	%
	 	5	 	 	B/B2 or lower
	 	 	2.50	%	 	 	1.50	%





The provisions of this definition are subject to Section 2.4.(c).




     “Approved Fund” means any Fund that is administered, managed or underwritten by (a) a Lender,
(b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or
manages a Lender.



     “Arranger” means Wachovia Capital Markets, LLC, together with its successors and permitted
assigns.



     “Asset Purchase Agreement” has the meaning given that term in the second “WHEREAS” clause of
this Agreement, and in any event shall include and all schedules, exhibits, annexes and amendments
thereto and all side letters and agreements affecting the terms thereof or entered into in
connection therewith.



     “Asset Purchase Documents” means the Merger Agreement, the Asset Purchase Agreement and the
other documents, instruments and agreements executed by any Loan Party in connection therewith.



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



     “Assignment and Assumption” means an Assignment and Assumption entered into by a Lender and an
Eligible Assignee (with the consent of any party whose consent is required by Section 12.5.),
substantially in the form of Exhibit A or any other form approved by the Agent.



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



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



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



- 5 -









 





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



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



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



     “Capitalized Lease Obligation” means an obligation under a lease that is required to be
capitalized for financial reporting purposes in accordance with GAAP. The amount of a Capitalized
Lease Obligation is the capitalized amount of such obligation as would be required to be reflected
on a balance sheet of the applicable Person prepared in accordance with GAAP as of the applicable
date.



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



     “Class” with respect to any Loan, refers to whether such Loan is a Revolving Loan or Term
Loan.



     “Collateral” means any personal property of any of the Loan Parties, now owned or hereafter
acquired, upon which a Lien is purported to be created by any Security Document, and includes,
without limitation, all “Collateral” under and as defined in the Pledge Agreement and under and as
defined in the Security Agreement.



- 6 -









 





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



     “Commitment” means, as to any Lender, the Revolving Commitment, if any, or Term Commitment, if
any, of such Lender.



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



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



     “Control” means the possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of a Person, whether through the ability to exercise voting
power, by contract or otherwise. “Controlling” and “Controlled” have meanings correlative thereto.



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



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



     “Credit Rating” means the rating assigned by a Rating Agency to (a) the senior unsecured long
term Indebtedness of a Person or (b) a specific Investment.



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



     “Defaulting Lender” has the meaning given that term in Section 3.11.



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



- 7 -









 





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



     “Disposition” means any sale, lease, assignment, transfer or other disposition by the Parent,
the Borrower or any Subsidiary of any of the following:



     (a) any Property and any parcel of real property that would be a Property if located in a
state of the United States of America or the District of Columbia;



     (b) Equity Interests in a Subsidiary or Unconsolidated Affiliate;



     (c) any asset constituting Collateral; and



     (d) any other asset (other than Cash Equivalents) the sale, lease (other than leases of
property in the ordinary course of business), assignment, transfer or other disposition of which
results in receipt by the Parent, the Borrower or any Subsidiary of Net Cash Proceeds in excess of
$25,000,000.



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



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



     “EBITDA” means, with respect to a Person for any period (without duplication): (a) net income
(loss) of such Person for such period determined on a consolidated basis, in accordance with GAAP,
exclusive of the following (but only to the extent included in determination of such net income
(loss)): (i) depreciation and amortization; (ii) Interest Expense; (iii) income tax expense; (iv)
extraordinary or non-recurring gains and losses; and (v) other non-cash items, including without
limitation, non-cash deferred compensation expense for officers and employees and amortization of
stock grants; plus (b) such Person’s pro rata share of EBITDA of its Unconsolidated Affiliates.
EBITDA shall be adjusted to remove any impact from straight line rent leveling adjustments required
under GAAP and amortization of intangibles pursuant to Statement of Financial Accounting Standards
number 141.



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



- 8 -









 





     “Eligible Assignee” means (a) a Lender, (b) an Affiliate of a Lender, (c) an Approved Fund,
and (d) any other Person (other than a natural person) approved by (i) the Agent and (ii) unless a
Default or Event of Default shall exist, the Borrower (each such approval by the Agent or the
Borrower not to be unreasonably withheld or delayed); provided that
notwithstanding the foregoing, “Eligible Assignee” shall not include the Borrower or any of the
Borrower’s Affiliates or Subsidiaries.



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



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



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



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



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



     “Escrow Agent” has the meaning given that term in Section 2.1.(d).



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



- 9 -









 





     “Excluded Subsidiary” means (a) any Subsidiary (i) holding title to or beneficially owning
assets which are or are intended to become collateral for any Secured Indebtedness of such
Subsidiary, or being a beneficial owner of a Subsidiary holding title to or beneficially owning
such assets (but having no material assets other than such beneficial ownership interests) and (ii)
which (x) is, or is expected to be, prohibited from Guarantying the Indebtedness of any
other Person pursuant to any document, instrument or agreement evidencing such Secured Indebtedness
or (y) is prohibited from Guarantying the Indebtedness of any other Person pursuant to a provision
of such Subsidiary’s organizational documents which provision was included in such Subsidiary’s
organizational documents as a condition or anticipated condition to the extension of such Secured
Indebtedness, (b) any Subsidiary (i) more than 5.0% of the outstanding Equity Interest of which is
owned by Minority Holders and (ii) that is prohibited from Guarantying the Indebtedness of any
other Person without the consent of such Minority Holders and (c) any Subsidiary of any Subsidiary
described in clause (a) or (b) above.



     “Existing Credit Agreement” means that certain Credit Agreement dated as of February 5, 2004
by and among the Borrower, the financial institutions party thereto as “Lenders”, Credit Lyonnais
New York Branch, as Administrative Agent, and the other parties thereto.



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



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



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



     “Fixed Charges” means, for any period, the sum of (a) Interest Expense of the Parent and its
Subsidiaries determined on a consolidated basis for such period, (b) all regularly scheduled
principal payments made with respect to Indebtedness of the Parent and its Subsidiaries during such
period, other than any balloon, bullet or similar principal payment which repays such Indebtedness
in full, and (c) all Preferred Dividends paid during such period. The Parent’s pro rata share of
the Fixed Charges of Unconsolidated Affiliates of the Parent shall be included in determinations of
Fixed Charges.



- 10 -









 





     “Floating Rate Indebtedness” means all Indebtedness of a Person which bears interest at a
variable rate during the scheduled life of such Indebtedness and for which such Person has not
obtained interest rate swap agreements, interest rate “cap” or “collar” agreements or other similar
Derivatives Contracts which effectively cause such variable rates to be equivalent to
fixed rates less than or equal to (a) the rate (as reasonably determined by the Agent) borne by
United States 10-year Treasury Notes at the time the applicable Derivatives Contract became
effective plus (b) 3.0%.



     “Foreign Lender” means any Lender that is organized under the laws of a jurisdiction other
than that in which the Borrower is resident for tax purposes. For purposes of this definition, the
United States of America, each State thereof and the District of Columbia shall be deemed to
constitute a single jurisdiction.



     “Foreign Subsidiary” means a Subsidiary that (a) is not a Domestic Subsidiary and (b) is not a
“disregarded entity” under Treas. Reg. Section 301.7701-2(a).



     “Fund” means any Person (other than a natural person) that is (or will be) engaged in making,
purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in
the ordinary course of its business.



     “GAAP” means generally accepted accounting principles set forth in the opinions and
pronouncements of the Accounting Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting Standards Board or in
such other statements by such other entity as may be approved by a significant segment of the
accounting profession, which are applicable to the circumstances as of the date of determination.



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



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



     “Grantor” means, initially, the Borrower and each of the Subsidiaries set forth on Schedule
1.1.(B), together with any other Person that becomes a “Grantor” under the Security Agreement.



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



- 11 -









 





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



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



     “Indebtedness” means, with respect to a Person, at the time of computation thereof, all of the
following (without duplication): (a) all obligations of such Person in respect of money borrowed
(other than trade debt incurred in the ordinary course of business which is not more than 90 days
past due); (b) all obligations of such Person, whether or not for money borrowed (i) represented by
notes payable, or drafts accepted, in each case representing extensions of credit, (ii) evidenced
by bonds, debentures, notes or similar instruments, or (iii) constituting purchase money
indebtedness, conditional sales contracts, title retention debt instruments or other similar
instruments, upon which interest charges are customarily paid or that are issued or assumed as full
or partial payment for property or services rendered; (c) Capitalized Lease Obligations of such
Person; (d) all reimbursement obligations (contingent or otherwise) of such Person in respect of
letters of credit or acceptances (whether or not the same have been presented for payment); (e) all
Off-Balance Sheet Obligations of such Person; (f) all obligations of such Person to purchase,
redeem, retire, defease or otherwise make any payment in respect of any Mandatorily Redeemable
Stock issued by such Person or any other Person, valued at the greater of its voluntary or
involuntary liquidation preference plus accrued and unpaid dividends; (g) all



- 12 -









 




obligations of such
Person in respect of any purchase obligation, repurchase obligation, takeout commitment or forward
equity commitment, in each case evidenced by a binding agreement (excluding any such obligation to
the extent the obligation can be satisfied by the issuance of Equity Interests (other than
Mandatorily Redeemable Stock)); (h) net obligations under any Derivatives Contract not entered into
as a hedge against existing interest rate risk in respect of
Indebtedness, in an amount equal to the Derivatives Termination Value thereof; (i) all Indebtedness
of other Persons which such Person has Guaranteed or is otherwise recourse to such Person (except
for guaranties of customary exceptions for fraud, misapplication of funds, environmental
indemnities, voluntary bankruptcy, collusive involuntary bankruptcy, and other similar exceptions
to nonrecourse liability); (j) all Indebtedness of another Person secured by (or for which the
holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any
Lien on property or assets owned by such Person, even though such Person has not assumed or become
liable for the payment of such Indebtedness or other payment obligation; and (k) such Person’s pro
rata share of the Indebtedness of any Unconsolidated Affiliate of such Person. Indebtedness of any
Person shall include Indebtedness of any partnership or joint venture in which such Person is a
general partner or joint venturer to the extent of such Person’s pro rata share of the ownership of
such partnership or joint venture (except if such Indebtedness, or portion thereof, is recourse to
such Person, in which case the greater of such Person’s pro rata portion of such Indebtedness or
the amount of the recourse portion of the Indebtedness, shall be included as Indebtedness of such
Person). All Loans and Letter of Credit Liabilities shall constitute Indebtedness of the Borrower.




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



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



     “Interest Period” means with respect to any LIBOR Loan, each period commencing on the date
such LIBOR Loan is made, or in the case of the Continuation of a LIBOR Loan the last day of the
preceding Interest Period for such Loan, and ending 1, 2, 3 or 6 months thereafter, as the Borrower
may select in a Notice of Borrowing, Notice of Continuation or Notice of Conversion, as the case
may be, except that each Interest Period that commences on the last Business Day of a calendar
month, or on a day for which there is no corresponding day in the appropriate subsequent calendar
month, shall end on the last Business Day of the appropriate subsequent calendar month.
Notwithstanding the foregoing: (a) if any Interest Period for a Revolving Loan would otherwise end
after the Revolving Termination Date, such Interest Period shall end on the Revolving Termination
Date; (b) if any Interest Period for a Term Loan would otherwise end after the Term Loan Maturity
Date, such Interest Period shall end on the Term Loan Maturity Date; and (c) each Interest Period
that would otherwise end on a day which is not a Business Day shall end on the immediately
following Business Day (or, if such immediately following Business Day falls in the next calendar
month, on the immediately preceding Business Day).



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




- 13 -









 





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



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



     “Lender” means each financial institution from time to time party hereto as a “Lender”,
together with its successors and permitted assigns.



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



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



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



     “Letter of Credit Liabilities” means, without duplication, at any time and in respect of any
Letter of Credit, the sum of (a) the Stated Amount of such Letter of Credit plus (b) the aggregate
unpaid principal amount of all Reimbursement Obligations of the Borrower at such time due and
payable in respect of all drawings made under such Letter of Credit. For purposes of this
Agreement, a Lender (other than the Lender acting as the Agent) shall be deemed to hold a Letter of
Credit Liability in an amount equal to its participation interest in the related Letter of Credit
under Section 2.3.(i), and the Lender acting as the Agent shall be deemed to hold a Letter of
Credit Liability in an amount equal to its retained interest in the related Letter of Credit after
giving effect to the acquisition by the Lenders other than the Lender acting as the Agent of their
participation interests under such Section.



     “LIBOR” means, for any LIBOR Loan for any Interest Period therefor, the rate per annum
(rounded upwards, if necessary, to the nearest 1/100 of 1%) appearing on Reuters Screen LIBOR01
Page (or any successor page) as the London interbank offered rate for deposits in



- 14 -









 







Dollars at approximately 11:00 a.m. (London time) two Business Days prior to the first day of such
Interest Period for a term comparable to such Interest Period. If for any reason such rate is not
available, LIBOR shall be, for any Interest Period, the rate per annum reasonably determined by the
Agent as the rate of interest at which Dollar deposits in the approximate amount of such LIBOR Loan
would be offered by the Agent to major banks in the London interbank Eurodollar market at their
request at or about 11:00 a.m. (London time) two Business Days prior to the first day of such
Interest Period for a term comparable to such Interest Period.



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



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



     “Loan” means a Revolving Loan or a Term Loan.



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



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



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



- 15 -









 







issuer of such Equity Interest), (b) is convertible into or exchangeable or exercisable for
Indebtedness or Mandatorily Redeemable Stock, or (c) is redeemable at the option of the holder
thereof, in whole or in part (other than an Equity Interest which is redeemable solely in exchange
for common stock or other equivalent common Equity Interests), in each case on or prior to the Term
Loan Maturity Date.



     “Mandatory Prepayment Event” means (a) the incurrence by the Parent, the Borrower or any
Subsidiary of any Indebtedness or any refinancing thereof, (b) any Disposition, Purchase Price
Refund or Recovery Event or (c) any Equity Issuance by the Parent, the Borrower or any Subsidiary.



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



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



     “Material Subsidiary” means any Subsidiary to which more than 5.0% of Adjusted Total Asset
Value is attributable on an individual basis.



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



     “Minority Holder” means any Person (other than the Borrower, any Subsidiary or any other
Affiliate) that is the holder of an Equity Interest in a Subsidiary of the Borrower that is not a
Wholly Owned Subsidiary.



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



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



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



     “Multiemployer Plan” means at any time a multiemployer plan within the meaning of Section
4001(a)(3) of ERISA to which any member of the ERISA Group is then making or



- 16 -









 







accruing an obligation to make contributions or has within the preceding five plan years made
contributions, including for these purposes any Person which ceased to be a member of the ERISA
Group during such five year period.



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



     “Net Cash Proceeds” means with respect to (a) a Disposition or Recovery Event, the aggregate
amount of all cash received (including without limitation, all cash payments received by way of
deferred payment of principal or interest pursuant to a note or installment receivable or
otherwise, but only as and when received), directly or indirectly, by the Parent, the Borrower or
any Subsidiary in connection with such Disposition or Recovery Event net of (i) the amount of any
out-of-pocket legal fees, title and recording tax expenses, commissions and other customary fees
and expenses actually incurred by the Parent, the Borrower or such Subsidiary in connection
therewith, (ii) any income taxes reasonably estimated in good faith to be payable by the Parent,
the Borrower or such Subsidiary in connection with such Disposition or Recovery Event (after taking
into account any available tax credits or deductions and any tax sharing arrangements) and other
taxes thereon to the extent such other taxes are actually paid by the Parent, the Borrower or such
Subsidiary, (iii) with respect to a Recovery Event, the amount of cash proceeds used for the repair
and replacement of the Property subject to the Recovery Event, (iv) subject to Section 9.2., any
cash distributions of capital gains required to be distributed to shareholders of the Parent
pursuant to the requirements and conditions imposed on REITs under the Internal Revenue Code and
(v) any repayments by the Parent, the Borrower, such Subsidiary or any other Subsidiary of
Indebtedness (other than Indebtedness under any of the Loan Documents) to the extent that such
Indebtedness is secured by a Lien on the property that is the subject of such Disposition or
Recovery Event or is otherwise required by the terms of such Indebtedness (as in effect immediately
prior to such Recovery Event or Disposition) to be repaid as a result of the occurrence of such
Disposition or Recovery Event, (b) incurrence of Indebtedness, the aggregate amount of all cash
received from such incurrence, net of the amount of any out-of-pocket legal fees, title and
recording tax expenses, investment banking fees, underwriting discounts, commissions, closing
costs, transfer taxes, transfer costs, termination fees, liquidated damages, reserves, escrows and
prorations required by contract or custom, and other customary fees and expenses actually incurred
by the Parent, the Borrower or such Subsidiary in connection therewith, (c) any Purchase Price
Refund, the aggregate cash amount thereof, net of any expenses actually incurred by the Parent, the
Borrower or such Subsidiary in connection therewith, and (d) any Equity Issuance, the aggregate
amount of all cash received by the Parent, the Borrower or any other Subsidiary in respect of such
Equity Issuance less investment banking fees, legal fees, accountants fees, underwriting discounts
and commissions, listing fees, financial printing costs and other customary fees and expenses
actually incurred by the Parent, the Borrower or any other Subsidiary in connection with such
Equity Issuance.



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



     “Note” means a Revolving Note or a Term Note.



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



     “Notice of Continuation” means a notice in the form of Exhibit C to be delivered to the Agent
pursuant to Section 2.8. evidencing the Borrower’s request for the Continuation of a LIBOR Loan.



     “Notice of Conversion” means a notice in the form of Exhibit D to be delivered to the Agent
pursuant to Section 2.9. evidencing the Borrower’s request for the Conversion of a Loan from one
Type to another Type.



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



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



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



     “Other Net Assets” means (a) all asset (other than cash, cash equivalents, marketable
securities, Properties and intangible assets) of the Parent and its Subsidiaries that would be set
forth on a consolidated balance sheet of the Parent and its Subsidiaries prepared in accordance



- 18 -









 







with GAAP, minus (b) all liabilities (other than Indebtedness) of the Parent and its Subsidiaries
determined on a consolidated basis.



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



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



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



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



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



     “Pledge Agreement” means the Pledge Agreement to which the Pledgors are parties substantially
in the form of Exhibit E.



     “Pledgor” means, initially, the Borrower and each of the Persons set forth on Schedule
1.1.(D), together with any other Person that becomes a “Pledgor” under the Pledge Agreement.



     “Post-Default Rate” means a rate per annum equal to the Base Rate as in effect from time to
time plus the Applicable Margin for Base Rate Loans plus four percent (4.0%).



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     “Preferred Dividends” means, for any period and without duplication, all Restricted Payments
paid during such period on Preferred Equity Interests issued by the Parent or a Subsidiary.
Preferred Dividends shall not include dividends or distributions (a) paid or payable solely in
Equity Interests (other than Mandatorily Redeemable Stock) payable to holders of such class of
Equity Interests, (b) paid or payable to the Parent or a Subsidiary, or (c) constituting or
resulting in the redemption of Preferred Equity Interests, other than scheduled redemptions not
constituting balloon, bullet or similar redemptions in full. Preferred Dividends shall not include
dividends or distributions paid or payable in respect of (i) Preferred Equity Interests that are
convertible into common Equity Interests of the Parent or the Borrower or (ii) Class B Operating
Partnership units issued by the Borrower in connection with the acquisition of the Marriott Crystal
Gateway in Arlington, Virginia and other operating partnership units issued by the Borrower having
similar terms as such Class B Operating Partnership units.



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



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



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



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



     “Purchase Price Refund” means any cash amount received by the Parent, the Borrower or any
Subsidiary as a result of a purchase price adjustment or similar event in connection with a given
acquisition of property by the Borrower or such Subsidiary, including without limitation, any such
adjustment or event under any Asset Purchase Document.



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



     “Recovery Event” means any settlement of or payment in respect of any property or casualty
insurance claim or any condemnation proceeding relating to any property of the Parent, the Borrower
or any Subsidiary.



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



- 20 -









 





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



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



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



     “Requisite Lenders” means, as of any date, (a) Lenders having more than 50.0% of the aggregate
amount of the Revolving Commitments and the outstanding Term Loans or (b) if the Revolving
Commitments have been terminated or reduced to zero, Lenders holding more than 50.0% of the
principal amount of the aggregate outstanding Loans and Letter of Credit Liabilities. Commitments,
Loans and Letter of Credit Liabilities held by Defaulting Lenders shall be disregarded when
determining the Revolving Requisite Lenders.



     “Requisite Revolving Lenders” means, as of any date, Revolving Lenders having more than 50.0%
of the aggregate amount of the Revolving Commitments, or, if the Revolving Commitments have been
terminated or reduced to zero, Revolving Lenders holding more than 50.0% of the aggregate principal
amount of the outstanding Revolving Loans and Letter of Credit Liabilities. Revolving Commitments,
Revolving Loans and Letter of Credit Liabilities held by Defaulting Lenders shall be disregarded
when determining the Requisite Revolving Lenders.



     “Requisite Term Lenders” means, as of any date, Term Lenders holding more than 50.0% of the
aggregate principal amount of the outstanding Term Loans. Term Loans held by Defaulting Lenders
shall be disregarded when determining the Requisite Term Lenders.



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



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



- 21 -









 







or other rights to acquire any Equity Interests of the Parent or any Subsidiary now or hereafter
outstanding.



     “Revolving Commitment” means, as to each Revolving Lender, such Revolving Lender’s obligation
(a) to make Revolving Loans pursuant to Section 2.1. and (b) to issue (in the case of the Revolving
Lender then acting as Agent) or participate in (in the case of the other Revolving Lenders) Letters
of Credit pursuant to Section 2.3.(a) and 2.3.(i), respectively (but in the case of the Revolving
Lender acting as the Agent excluding the aggregate amount of participations in the Letters of
Credit held by the other Revolving Lenders), in each case, in an amount up to, but not exceeding,
the amount set forth for such Revolving Lender on Schedule I as such Lender’s “Revolving
Commitment” or as set forth in the applicable Assignment and Assumption, as the same may be reduced
from time to time pursuant to Section 2.11. or increased or reduced as appropriate to reflect any
assignments to or by such Lender effected in accordance with Section 12.5.



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



     “Revolving Lender” means each Lender that has a Revolving Commitment or is the holder of a
Revolving Loan.



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



     “Revolving Note” has the meaning given that term in Section 2.10.(a).



     “Revolving Termination Date” means April 9, 2010, or such later date to which the Revolving
Termination Date may be extended pursuant to Section 2.12.(a).



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



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



     “Secured Indebtedness” means Indebtedness of a Person secured in any manner by any Lien.



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



     “Security Agreement” means the Security Agreement to which various Loan Parties are parties
substantially in the form of Exhibit F.



     “Security Document” means the Pledge Agreement, the Security Agreement and any other security
agreement, financing statement, or other document, instrument or agreement creating, evidencing or
perfecting the Agent’s Liens in any of the Collateral.



     “Seller” has the meaning given that term in the first “WHEREAS” clause of this Agreement and
shall include the Seller’s successors and permitted assigns.



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



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



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



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



     “Tangible Net Worth” means, as of a given date, (a) the stockholders’ equity of the Parent and
Subsidiaries determined on a consolidated basis, plus (b) accumulated depreciation and
amortization, minus (c) the following (to the extent reflected in determining stockholders’ equity
of the Parent and its Subsidiaries): (i) the amount of any write-up in the book value of any assets
contained in any balance sheet resulting from revaluation thereof or any write-up in excess of the
cost of such assets acquired, and (ii) all amounts appearing on the assets side of any such balance
sheet for assets which would be classified as intangible assets under GAAP, all determined on a
consolidated basis.



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



     “Term Commitment” means, as to each Term Lender, such Term Lender’s obligation to make a Term
Loan pursuant to Section 2.2.(b) in an amount up to, but not exceeding, the amount set forth for
such Lender on Schedule I as such Lender’s “Term Commitment.”



     “Term Lender” means each Lender that has a Term Commitment or is the holder of a Term Loan.



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



     “Term Loan Maturity Date” means April 9, 2008, or such later date to which the Term Loan
Maturity Date may be extended pursuant to Section 2.12.(b) or (c).



     “Term Note” has the meaning given that term in Section 2.10.(b).



     “Titled Agents” means each of the Arranger, each Co-Syndication Agent, each Co-Documentation
Agent and any other Person awarded a similar honorific title in connection with this Agreement, and
shall include their respective successors and permitted assigns.



     “Total Asset Value” means the sum of all of the following (without duplication) of the Parent
and its Subsidiaries on a consolidated basis determined in accordance with GAAP applied on a
consistent basis: (a) cash, cash equivalents and marketable securities, plus (b) the undepreciated
GAAP book value of all Properties, plus (c) Other Net Assets. The Parent’s pro rata share of
assets held by its Unconsolidated Affiliates (excluding assets of the type described in the
immediately preceding clause (a)) will be included in Total Asset Value calculations consistent
with the above described treatment for wholly owned assets.



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



     “Total Net Indebtedness” means (a) Total Indebtedness of the Parent and all Subsidiaries
determined on a consolidated basis minus (b) all cash and cash equivalents of the Parent and all
Subsidiaries determined on a consolidated basis.



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



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



- 24 -









 





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



     “Unpledgeable Subsidiary” means (a) any Subsidiary (i) holding title to or beneficially owning
assets which are or are intended to become collateral for any Secured Indebtedness of such
Subsidiary, or being a beneficial owner of a Subsidiary holding title to or beneficially owning
such assets (but having no material assets other than such beneficial ownership interests) and (ii)
the Equity Interests of which may not be pledged as security to any Person pursuant to restrictions
contained in (x) any document, instrument or agreement evidencing such Secured Indebtedness or (y)
such Subsidiary’s organizational documents included as a condition or anticipated condition to the
extension of such Secured Indebtedness, (b) any Subsidiary (i) more than 5.0% of the outstanding
Equity Interest of which is owned by Minority Holders and (ii) the Equity Interests of which may
not be pledged as security to any Person without the consent of such Minority Holders and (c) any
Subsidiary of a Subsidiary described in clause (a) or (b) above.



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



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



Section 1.2. General; References to Times.




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



- 25 -









 







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



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




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



Article II. Credit Facility




Section 2.1. Revolving Loans.




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



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



- 26 -









 





     (c) Disbursements of Revolving Loan Proceeds. No later than 1:00 p.m. on the date
specified in the Notice of Borrowing, each Revolving Lender will make available for the account of
its applicable Lending Office to the Agent at the Principal Office, in immediately available funds,
the proceeds of the Revolving Loan to be made by such Revolving Lender. With respect to Revolving
Loans to be made after the Effective Date, unless the Agent shall have been notified by any
Revolving Lender prior to the specified date of borrowing that such Revolving Lender does not
intend to make available to the Agent the Revolving Loan to be made by such Revolving Lender on
such date, the Agent may assume that such Revolving Lender will make the proceeds of such Revolving
Loan available to the Agent on the date of the requested borrowing as set forth in the Notice of
Borrowing and the Agent may (but shall not be obligated to), in reliance upon such assumption, make
available to the Borrower the amount of such Revolving Loan to be provided by such Revolving
Lender. Subject to satisfaction of the applicable conditions set forth in Article V. for such
borrowing, the Agent will make the proceeds of such borrowing available to the Borrower no later
than 2:00 p.m. on the date and at the account specified by the Borrower in such Notice of
Borrowing.



     (d) Revolving Loans to be Funded into Escrow. The parties agree that the provisions
of this subsection (d) shall apply to any Revolving Loans the Borrower intends to use to finance
the Acquisition and accordingly, to the extent any of the following terms are inconsistent with the
preceding provisions of this Section, the following shall control.




     (i) Requesting Revolving Loans. If the Borrower intends to use the proceeds of
any Revolving Loans to finance the Acquisition, the Borrower shall give the Agent notice
(which must be in the form of a Notice of Borrowing and must be received by the Agent no
later than 11:00 a.m. on the date that is three Business Day prior to the anticipated
Effective Date) requesting that the Revolving Lenders make such Revolving Loans and
specifying the amount of such Revolving Loans to be borrowed and the other information
required to be included in a Notice of Borrowing. Upon receipt of such notice the Agent
shall promptly notify each Revolving Lender. Such Notice of Borrowing shall be irrevocable
once given and binding on the Borrower.




     (ii) Disbursement of Revolving Loans. No later than 2:00 p.m. on the date one
day prior to the anticipated Effective Date and upon the Agent’s request, each Revolving
Lender will make available to the Agent at the Principal Office, in immediately available
funds, the proceeds of such Revolving Lender’s Revolving Loan that the Borrower has
requested be made available to finance the Acquisition notwithstanding that the applicable
conditions contained in Article V. have not been satisfied. No later than 4:00 p.m. on such
date, the Agent shall deliver the proceeds of such Revolving Loans to a title company or
financial institution (the “Escrow Agent”) which shall have agreed (a) to hold the proceeds
of such Revolving Loans and the Term Loans in escrow for the applicable Lenders on terms
acceptable to the Agent in its sole discretion and (b) to release such proceeds to the
Borrower only upon written confirmation (which may be in the form of an e-mail) from the
Agent or the Agent’s counsel that all of the applicable conditions contained in Article V.
shall have been satisfied (or waived in accordance with this Agreement). Unless the Agent
shall have been notified by any Revolving Lender that such Revolving Lender does not intend
to



- 27 -









 







make available to the Agent the proceeds of the Revolving Loan to be made by such Revolving
Lender on the closing date of the Acquisition, the Agent may assume that such Revolving
Lender will make the proceeds of such Revolving Loan available to the Agent and the Agent
may (but shall not be obligated to), in reliance upon such assumption, make available to the
Escrow Agent the amount of such Revolving Loan to be provided by such Revolving Lender.
Subject to satisfaction (or waived in accordance with this Agreement) of the applicable
conditions contained in Article V., the Agent will make the proceeds of all such Revolving
Loans available to the Borrower as soon as practicable, and in any event no later than 11:00
a.m., on the Effective Date by authorizing the Escrow Agent to release such proceeds from
such escrow.




     (iii) Interest Accrual; Return of Funds from Escrow. The Borrower acknowledges
that interest shall begin to accrue on a Revolving Lender’s Revolving Loan being made as
contemplated in this subsection on the date such Revolving Lender makes the proceeds of such
Revolving Loan available to the Agent (or the Agent makes the proceeds of a Revolving Loan
available to the Escrow Agent on behalf of a Lender, with such interest being for the
account of the Agent) as contemplated in the immediately preceding clause (ii). The
Borrower agrees that if the Effective Date has not occurred by 3:00 p.m. on April 13, 2007,
then on said date: (i) the Agent, on behalf of the Revolving Lenders, shall require the
Escrow Agent to return to the Agent the proceeds of such Revolving Loans which shall be paid
to the Revolving Lenders (or the Agent, if applicable) in accordance with the applicable
provisions of this Agreement; (ii) the Borrower shall pay to the Agent all accrued and
unpaid interest on such Revolving Loans, which shall be paid to the Revolving Lenders (or
the Agent, if applicable) in accordance with the applicable provisions of this Agreement and
(iii) the Revolving Commitments shall terminate.



Section 2.2. Term Loans.




     (a) Generally. Subject to the terms and conditions hereof, each Term Lender severally
and not jointly agrees to make a Term Loan to the Borrower in a principal amount of up to, but not
exceeding, the amount of the Term Commitment of such Lender. To the extent a Term Lender’s Term
Commitment is not utilized on the Effective Date, such Term Commitment shall terminate. Once
repaid, the principal amount of a Term Loan may not be reborrowed.



     (b) Requesting Term Loans. The Borrower shall give the Agent notice (which notice
must be received by the Agent no later than 11:00 a.m. on the date that is three Business Day prior
to the anticipated Effective Date) requesting that the Term Lenders make the Term Loans and
specifying the amount of Term Loans to be borrowed. Upon receipt of such notice the Agent shall
promptly notify each Term Lender. The notice of borrowing provided by the Borrower in the
preceding sentence shall be irrevocable once given and binding on the Borrower.



     (c) Disbursements of Term Loan Proceeds. No later than 2:00 p.m. on the date one day
prior to the anticipated Effective Date and upon the Agent’s request, each Term Lender will make
available for the account of its applicable Lending Office to the Agent at the Principal Office, in
immediately available funds, the proceeds of the Term Loan to be made by such Term Lender
notwithstanding that the applicable conditions contained in Article V. have not been



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satisfied. No later than 4:00 p.m. on such date, the Agent shall deliver the proceeds of the Term
Loans to the Escrow Agent which shall have agreed (a) to hold the proceeds of such Term Loans and
the Revolving Loans referred to in Section 2.1.(d) in escrow for the Lenders on terms acceptable to
the Agent in its sole discretion and (b) to release such proceeds to the Borrower only upon written
confirmation (which may be in the form of an e-mail) from the Agent or the Agent’s legal counsel
that all of the applicable conditions set forth in Article V. shall have been satisfied or waived
in accordance with this Agreement. Unless the Agent shall have been notified by any Term Lender
that such Term Lender does not intend to make available to the Agent the proceeds of the Term Loan
to be made by it, the Agent may assume that such Term Lender will make the proceeds of such Term
Loan available to the Agent and the Agent may (but shall not be obligated to), in reliance upon
such assumption, make available to the Escrow Agent the amount of such Term Loan to be provided by
such Term Lender. Subject to satisfaction (or waiver in accordance with the terms of this
Agreement) of the applicable conditions set forth in Article V., the Agent will make the proceeds
of the Term Loans available to the Borrower as soon as practicable, and in any event no later than
11:00 a.m., on the Effective Date by authorizing the Escrow Agent to release such proceeds from
such escrow.



     (d) Interest Accrual; Return of Funds from Escrow. The Borrower acknowledges that
interest shall begin to accrue on a Term Lender’s Term Loan on the date such Term Lender makes the
proceeds of such Term Loan available to the Agent (or the Agent makes the proceeds of a Term Loan
available to the Escrow Agent on behalf of a Term Lender, with such interest being for the account
of the Agent) as contemplated in the immediately preceding subsection. The Borrower agrees that if
the Effective Date has not occurred by 3:00 p.m. on April 13, 2007, then on said date: (i) the
Agent, on behalf of the Term Lenders, shall require the Escrow Agent to return to the Agent the
proceeds of the Term Loans which shall be paid to the Term Lenders (or the Agent, if applicable) in
accordance with the applicable provisions of this Agreement; (ii) the Borrower shall pay to the
Agent all accrued and unpaid interest on the Term Loans, which shall be paid to the Term Lenders
(or the Agent, if applicable) in accordance with the applicable provisions of this Agreement and
(iii) the Term Commitments shall terminate.



Section 2.3. Letters of Credit.




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



     (b) Terms of Letters of Credit. At the time of issuance, the amount, form, terms and
conditions of each Letter of Credit, and of any drafts or acceptances thereunder, shall be subject
to approval by the Agent and the Borrower. Notwithstanding the foregoing, in no event may the
expiration date of any Letter of Credit extend beyond the earlier of (i) the date one year from its
date of issuance or (ii) the Revolving Termination Date; provided, however, a Letter of Credit may
contain a provision providing for the automatic extension of the expiration date in the absence of
a notice of non-renewal from the Agent but in no event shall any such provision



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permit the extension of the expiration date of such Letter of Credit beyond the Revolving
Termination Date.



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



     (d) Reimbursement Obligations. Upon receipt by the Agent from the beneficiary of a
Letter of Credit of any demand for payment under such Letter of Credit, the Agent shall promptly
notify the Borrower of the amount to be paid by the Agent as a result of such demand and the date
on which payment is to be made by the Agent to such beneficiary in respect of such demand;
provided, however, the Agent’s failure to give, or delay in giving, such notice shall not discharge
the Borrower in any respect from the applicable Reimbursement Obligation. The Borrower hereby
unconditionally and irrevocably agrees to pay and reimburse the Agent for the amount of each demand
for payment under such Letter of Credit on or prior to the date on which payment is to be made by
the Agent to the beneficiary thereunder, without presentment, demand, protest or other formalities
of any kind (other than notice as provided in this subsection). Upon receipt by the Agent of any
payment in respect of any Reimbursement Obligation, the Agent shall, in accordance with Sections
3.1. and 3.2., pay to each Revolving Lender that has acquired a participation therein under the
second sentence of Section 2.3.(i) such Revolving Lender’s Revolving Commitment Percentage of such
payment.



     (e) Manner of Reimbursement. Upon its receipt of a notice referred to in the
immediately preceding subsection (d), the Borrower shall advise the Agent whether or not the
Borrower intends to borrow hereunder to finance its obligation to reimburse the Agent for the
amount of the related demand for payment and, if it does, the Borrower shall submit a timely
request for such borrowing as provided in the applicable provisions of this Agreement. If the
Borrower fails to so advise the Agent, or if the Borrower fails to reimburse the Agent for a



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demand for payment under a Letter of Credit by the date of such payment, then (i) if the applicable
conditions contained in Article V. would permit the making of Revolving Loans, the Borrower shall
be deemed to have requested a borrowing of Revolving Loans (which shall be Base Rate Loans) in an
amount equal to the unpaid Reimbursement Obligation and the Agent shall give each Revolving Lender
prompt notice of the amount of the Revolving Loan to be made available to the Agent and (ii) if
such conditions would not permit the making of Revolving Loans, the provisions of subsection (j) of
this Section shall apply. The limitations of Section 3.5.(a) shall not apply to any borrowing of
Base Rate Loans under this subsection.



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



     (g) Agent’s Duties Regarding Letters of Credit; Unconditional Nature of Reimbursement
Obligations. In examining documents presented in connection with drawings under Letters of
Credit and making payments under Letters of Credit against such documents, the Agent shall only be
required to use the same standard of care as it uses in connection with examining documents
presented in connection with drawings under letters of credit in which it has not sold
participations and making payments under such letters of credit. The Borrower assumes all risks of
the acts and omissions of, or misuse of the Letters of Credit by, the respective beneficiaries of
such Letters of Credit. In furtherance and not in limitation of the foregoing, neither the Agent
nor any of the Lenders shall be responsible for, and the Borrower’s obligations in respect of the
Letters of Credit shall not be affected in any manner by, (i) the form, validity, sufficiency,
accuracy, genuineness or legal effects of any document submitted by any party in connection with
the application for and issuance of or any drawing honored under any Letter of Credit even if it
should in fact prove to be in any or all respects invalid, insufficient, inaccurate, fraudulent or
forged; (ii) the validity or sufficiency of any instrument transferring or assigning or purporting
to transfer or assign any Letter of Credit, or the rights or benefits thereunder or proceeds
thereof, in whole or in part, which may prove to be invalid or ineffective for any reason; (iii)
failure of the beneficiary of any Letter of Credit to comply fully with conditions required in
order to draw upon such Letter of Credit; (iv) errors, omissions, interruptions or delays in
transmission or delivery of any messages, by mail, cable, telex, telecopy or otherwise, whether or
not they be in cipher; (v) errors in interpretation of technical terms; (vi) any loss or delay in
the transmission or otherwise of any document required in order to make a drawing under any Letter
of Credit, or of the proceeds thereof; (vii) the misapplication by the beneficiary of the proceeds
of any drawing under any Letter of Credit; or (viii) any consequences arising from causes beyond
the control of the Agent or the Lenders. None of the above shall affect, impair or prevent the
vesting of any of the Agent’s or any Lender’s rights or powers hereunder. Any action taken or
omitted to be taken by the Agent under or in connection with any Letter of Credit, if taken or
omitted in the absence of gross negligence or willful misconduct (as determined by a court of
competent jurisdiction in a final, non-appealable judgment), shall not create against the Agent or
any Lender any liability to the Borrower or any Lender. In this regard, the obligation of the
Borrower to reimburse the Agent for any drawing



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made under any Letter of Credit, and to repay any Revolving Loan made pursuant to the second
sentence of subsection (e) of this Section, shall be absolute, unconditional and irrevocable and
shall be paid strictly in accordance with the terms of this Agreement and any other applicable
Letter of Credit Document under all circumstances whatsoever, including without limitation, the
following circumstances: (A) any lack of validity or enforceability of any Letter of Credit
Document or any term or provisions therein; (B) any amendment or waiver of or any consent to
departure from all or any of the Letter of Credit Documents; (C) the existence of any claim,
setoff, defense or other right which the Borrower may have at any time against the Agent, any
Lender, any beneficiary of a Letter of Credit or any other Person, whether in connection with this
Agreement, the transactions contemplated hereby or in the Letter of Credit Documents or any
unrelated transaction; (D) any breach of contract or dispute between the Borrower, the Agent, any
Lender or any other Person; (E) any demand, statement or any other document presented under a
Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any
statement therein or made in connection therewith being untrue or inaccurate in any respect
whatsoever; (F) any non-application or misapplication by the beneficiary of a Letter of Credit of
the proceeds of any drawing under such Letter of Credit; (G) payment by the Agent under any Letter
of Credit against presentation of a draft or certificate which does not strictly comply with the
terms of such Letter of Credit; and (H) any other act, omission to act, delay or circumstance
whatsoever that might, but for the provisions of this Section, constitute a legal or equitable
defense to or discharge of the Borrower’s Reimbursement Obligations. Notwithstanding anything to
the contrary contained in this Section or Section 12.9., but not in limitation of the Borrower’s
unconditional obligation to reimburse the Agent for any drawing made under a Letter of Credit as
provided in this Section and to repay any Revolving Loan made pursuant to the second sentence of
the subsection (e) of this Section, the Borrower shall have no obligation to indemnify the Agent or
any Lender in respect of any liability incurred by the Agent or such Lender arising solely out of
the gross negligence or willful misconduct of the Agent or such Lender in respect of a Letter of
Credit as determined by a court of competent jurisdiction in a final, non-appealable judgment.
Except as otherwise provided in this Section, nothing in this Section shall affect any rights the
Borrower may have with respect to the gross negligence or willful misconduct of the Agent or any
Lender with respect to any Letter of Credit.



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



     (i) Revolving Lenders’ Participation in Letters of Credit. Immediately upon the
issuance by the Agent of any Letter of Credit each Revolving Lender shall be deemed to have
irrevocably and unconditionally purchased and received from the Agent, without recourse or
warranty, an undivided interest and participation to the extent of such Revolving Lender’s



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



     (j) Payment Obligation of Revolving Lenders. Each Revolving Lender severally agrees
to pay to the Agent in immediately available funds in Dollars the amount of such Revolving Lender’s
Revolving Commitment Percentage of each drawing paid by the Agent under each Letter of Credit to
the extent such amount is not reimbursed by the Borrower pursuant to Section 2.3.(d); provided,
however, that in respect of any drawing under any Letter of Credit, the maximum amount that any
Revolving Lender shall be required to fund, whether as a Revolving Loan or as a participation,
shall not exceed such Revolving Lender’s Revolving Commitment Percentage of such drawing. If the
notice referenced in the second sentence of Section 2.3.(e) is received by a Revolving Lender not
later than 11:00 a.m., then such Revolving Lender shall make such payment available to the Agent
not later than 2:00 p.m. on the date of demand therefor; otherwise, such payment shall be made
available to the Agent not later than 1:00 p.m. on the next succeeding Business Day. Each
Revolving Lender’s obligation to make such payments to the Agent under this subsection, and the
Agent’s right to receive the same, shall be absolute, irrevocable and unconditional and shall not
be affected in any way by any circumstance whatsoever, including without limitation, (i) the
failure of any other Revolving Lender to make its payment under this subsection, (ii) the financial
condition of the Borrower or any other Loan Party, (iii) the existence of any Default or Event of
Default, including any Event of Default described in Section 10.1.(f) or 10.1.(g) or (iv) the
termination of the Commitments. Each such payment to the Agent shall be made without any offset,
abatement, withholding or deduction whatsoever.



     (k) Information to Lenders. The Agent shall periodically deliver to the Lenders
information setting forth the Stated Amount of all outstanding Letters of Credit. Other than as
set forth in this Section, the Agent shall have no duty to notify the Lenders regarding the
issuance or other matters regarding Letters of Credit issued hereunder. The failure of the Agent
to perform its requirements under this subsection shall not relieve any Revolving Lender from its
obligations under Section 2.3.(j).



Section 2.4. Rates and Payment of Interest on Loans.




     (a) Rates. The Borrower promises to pay to the Agent for the account of each Lender
interest on the unpaid principal amount of each Loan made by such Lender for the period from and
including the date of the making of such Loan (it being understood that a Revolving Loan



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referred to in Section 2.1.(d) and a Term Loan shall be deemed to have been made when the
applicable Lender makes the proceeds of such Loan available to the Agent (or the Agent makes the
proceeds of such Loan available to the Escrow Agent on behalf of such Lender) whichever occurs
first) to but excluding the date such Loan shall be paid in full, at the following per annum rates:




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




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


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




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



     (c) Inaccurate Financial Statements or Compliance Certificates. If any financial
statement or Compliance Certificate delivered pursuant to Section 8.3. is shown to be inaccurate
(regardless of whether this Agreement or the Commitments are in effect when such inaccuracy is
discovered), and such inaccuracy, if corrected, would have led to the application of a higher
Applicable Margin for any period (an “Applicable Period”) than the Applicable Margin applied for
such Applicable Period, and only in such case, then the Borrower shall immediately (i) deliver to
the Agent a corrected Compliance Certificate for such Applicable Period, (ii) determine the
Applicable Margin for such Applicable Period based on the corrected Compliance Certificate, and
(iii) pay to the Agent for the account of the Lenders the accrued additional interest owing as a
result of such increased Applicable Margin for such Applicable Period, which payment shall be paid
to the Lenders by the Agent in accordance with Section 3.1. and 3.2. This subsection shall not in
any way limit the rights of the Agent and Lenders (x) with respect to the last sentence of
subsection (a) of this Section or (y) under Article X.



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Section 2.5. Number of Interest Periods.




     There may be no more than 6 different Interest Periods for LIBOR Loans that are Revolving
Loans outstanding at the same time and no more than 4 different Interest Periods for LIBOR Loans
that are Term Loans outstanding at the same time.



Section 2.6. Repayment of Loans.




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



     (b) Term Loans. The Borrower shall repay the entire outstanding balance of, and all
accrued but unpaid interest on, the Term Loans on the Term Loan Maturity Date.



Section 2.7. Prepayments.




     (a) Optional. Subject to Section 4.4., the Borrower may prepay any Loan at any time
without premium or penalty. The Borrower shall give the Agent at least one Business Day’s prior
written notice of the prepayment of any Revolving Loan or Term Loan.



     (b) Mandatory.




     (i) Commitment Overadvance. If at any time the aggregate principal amount of
all outstanding Revolving Loans, together with the aggregate amount of all Letter of Credit
Liabilities, exceeds the aggregate amount of the Revolving Commitments in effect at such
time, the Borrower shall immediately pay to the Agent for the account of the Revolving
Lenders the amount of such excess. Payments under this clause shall be applied to repay the
outstanding principal amount of the Revolving Loans and any Reimbursement Obligations pro
rata in accordance with Section 3.2. and if any Letters of Credit are outstanding at such
time the remainder, if any, shall be deposited into the Collateral Account for application
to any Reimbursement Obligations.




     (ii) Mandatory Prepayment Events. On the date 3 Business Days following
receipt by the Parent, the Borrower or any of their respective Subsidiaries of Net Cash
Proceeds from any Mandatory Prepayment Event, the Borrower shall pay to the Agent for the
account of the Lenders all such Net Cash Proceeds for application to the outstanding
principal balance of the Term Loans or Revolving Loans as provided in this clause. Not
later than 1 Business Day following receipt the Parent, by the Borrower or any of their
respective Subsidiaries of such Net Cash Proceeds the Borrower shall give notice thereof to
the Agent, including the amount of the outstanding principal balance of the Term Loans or
Revolving Loans to be prepaid pursuant to this clause. All such payments shall be applied
to the outstanding principal balance of the Term Loans except to the extent the amount of
any such payment is attributable to Net Cash Proceeds from the incurrence of Indebtedness
secured by the Hyatt Hotel located at 1255 Rue-Jeanne Mance, Montreal Quebec H5B 1E5,
Canada., in which case such payment shall first be applied to the outstanding principal
balance of the Revolving Loans and then to the outstanding



- 35 -









 







principal balance of the Term Loans. The Agent shall promptly notify the Term Lenders and
Revolving Lenders, as applicable, of the amount of Obligations to be so prepaid. The
parties agree that funds held by a “qualified intermediary” or an “exchange accommodation
titleholder” in connection with a transaction intended by the Borrower to qualify for tax
treatment under Section 1031 of the Internal Revenue Code shall not be deemed received by
the Parent, the Borrower or any Subsidiary until the Parent, the Borrower or a Subsidiary
actually receives such funds. The Borrower shall not be required to make any payment under
this clause (ii) unless and until the aggregate amount of Net Cash Proceeds received by the
Parent, the Borrower and their respective Subsidiaries in respect of Mandatory Prepayment
Events for which the Borrower has not already made a payment under this clause (ii) exceeds
$5,000,000.




     (iii) Effect of Prepayments. If the Borrower is required to pay any
outstanding LIBOR Loans by reason the preceding subsection (ii) of this Section prior to the
end of the applicable Interest Period therefor, the Borrower shall not be required to pay
any amounts otherwise due under Section 4.4.



     (c) Derivatives Contracts. No repayment or prepayment pursuant to this Section shall
affect any of the Borrower’s obligations under any Derivatives Contract between the Borrower and
any Lender (or any Affiliate of any Lender).



Section 2.8. Continuation.




     So long as no Default or Event of Default shall exist, the Borrower may on any Business Day,
with respect to any LIBOR Loan, elect to maintain such LIBOR Loan or any portion thereof as a LIBOR
Loan by selecting a new Interest Period for such LIBOR Loan. Each new Interest Period selected
under this Section shall commence on the last day of the immediately preceding Interest Period.
Each selection of a new Interest Period shall be made by the Borrower giving to the Agent a Notice
of Continuation not later than 11:00 a.m. on the third Business Day prior to the date of any such
Continuation. Such notice by the Borrower of a Continuation shall be by telephone or telecopy,
confirmed immediately in writing if by telephone, in the form of a Notice of Continuation,
specifying (a) the proposed date of such Continuation, (b) the LIBOR Loans and portions thereof
subject to such Continuation and (c) the duration of the selected Interest Period, all of which
shall be specified in such manner as is necessary to comply with all limitations on Loans
outstanding hereunder. Each Notice of Continuation shall be irrevocable by and binding on the
Borrower once given. Promptly after receipt of a Notice of Continuation, the Agent shall notify
each Lender holding any such Loan being Continued by telecopy, or other similar form of
transmission, of the proposed Continuation. If the Borrower shall fail to select in a timely
manner a new Interest Period for any LIBOR Loan in accordance with this Section, or if a Default or
Event of Default shall exist, such Loan will automatically, on the last day of the current Interest
Period therefor, Convert into a Base Rate Loan notwithstanding the first sentence of Section 2.9.
or the Borrower’s failure to comply with any of the terms of such Section.



Section 2.9. Conversion.




     The Borrower may on any Business Day, upon the Borrower’s giving of a Notice of Conversion to
the Agent, Convert all or a portion of a Loan of one Type into a Loan of another



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Type; provided, however, a Base Rate Loan may not be Converted to a LIBOR Loan if a Default or
Event of Default shall exist. Any Conversion of a LIBOR Loan into a Base Rate Loan shall be made
on, and only on, the last day of an Interest Period for such LIBOR Loan and, upon Conversion of a
Base Rate Loan into a LIBOR Loan, the Borrower shall pay accrued interest to the date of Conversion
on the principal amount so Converted. Each such Notice of Conversion shall be given not later than
11:00 a.m. on the Business Day prior to the date of any proposed Conversion into Base Rate Loans
and on the third Business Day prior to the date of any proposed Conversion into LIBOR Loans.
Promptly after receipt of a Notice of Conversion, the Agent shall notify each Lender holding a Loan
being Converted by telecopy, or other similar form of transmission, of the proposed Conversion.
Subject to the restrictions specified above, each Notice of Conversion shall be by telephone
(confirmed immediately in writing) or telecopy in the form of a Notice of Conversion specifying (a)
the requested date of such Conversion, (b) the Type of Loan to be Converted, (c) the portion of
such Type of Loan to be Converted, (d) the Type of Loan such Loan is to be Converted into and (e)
if such Conversion is into a LIBOR Loan, the requested duration of the Interest Period of such
Loan. Each Notice of Conversion shall be irrevocable by and binding on the Borrower once given.



Section 2.10. Notes.




     (a) Revolving Note. The Revolving Loans made by each Revolving Lender shall, in
addition to this Agreement, also be evidenced by a promissory note of the Borrower substantially in
the form of Exhibit G (each a “Revolving Note”), payable to the order of such Revolving Lender in a
principal amount equal to the amount of its Revolving Commitment as originally in effect and
otherwise duly completed.



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



     (c) Records. The date, amount, interest rate, Type and duration of Interest Periods
(if applicable) of each Loan made by each Lender to the Borrower, and each payment made on account
of the principal thereof, shall be recorded by such Lender on its books and such entries shall be
binding on the Borrower, absent manifest error; provided, however, that the failure of a Lender to
make any such record shall not affect the obligations of the Borrower under any of the Loan
Documents.



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



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Section 2.11. Voluntary Reductions of the Revolving Commitment.




     The Borrower shall have the right to terminate or reduce the aggregate unused amount of the
Revolving Commitments (for which purpose use of the Revolving Commitments shall be deemed to
include the aggregate amount of Letter of Credit Liabilities) at any time and from time to time
without penalty or premium upon not less than 5 Business Days prior written notice to the Agent of
each such termination or reduction, which notice shall specify the effective date thereof and the
amount of any such reduction and shall be irrevocable once given and effective only upon receipt by
the Agent; provided, however, if the Borrower seeks to reduce the aggregate amount of the Revolving
Commitments below $100,000,000, then the Revolving Commitments shall all automatically and
permanently be reduced to zero. The Agent will promptly transmit such notice to each Revolving
Lender. The Revolving Commitments, once terminated or reduced may not be increased or reinstated.



Section 2.12. Extension of Revolving Termination Date and Term Loan Maturity Date.




     (a) Revolving Termination Date. The Borrower shall have the right, exercisable two
times, to extend the Revolving Termination Date by one year. The Borrower may exercise such right
only by executing and delivering to the Agent at least 90 days but not more than 180 days prior to
the current Revolving Termination Date, a written request for such extension. The Agent shall
forward to each Lender a copy of such a request delivered to the Agent promptly upon receipt
thereof. Subject to delivery to the Agent of such a request and satisfaction of the following
conditions, the Revolving Termination Date shall be extended for one year effective on the date
which, but for such extension, would have been the Revolving Termination Date so long as: (i)
immediately prior to such extension and immediately after giving effect thereto, (x) no Default or
Event of Default shall exist and (y) the representations and warranties made or deemed made by the
Borrower and each other Loan Party in the Loan Documents to which any of them is a party, shall be
true and correct in all material respects on and as of the date of such extension with the same
force and effect as if made on and as of such date except to the extent that such representations
and warranties expressly relate solely to an earlier date (in which case such representations and
warranties shall have been true and correct in all material respects on and as of such earlier
date) and except for changes in factual circumstances not prohibited under the Loan Documents and
(ii) the Borrower shall have paid the Fees payable under Section 3.6.(c).



     (b) Extension of Term Loan Maturity Date Without Rating. Subject to the following
subsection (d), the Borrower shall have the right, exercisable two times, to extend the Term Loan
Maturity Date by one year pursuant to this subsection. The Borrower may exercise such right only
by executing and delivering to the Agent at least 90 days but not more than 180 days prior to the
current Term Loan Maturity Date, a written request for such extension, such request to specify that
it is being made pursuant to this subsection (as opposed to the following subsection (c)). The
Agent shall forward to each Lender a copy of such a request delivered to the Agent promptly upon
receipt thereof. Subject to delivery to the Agent of such a request and satisfaction of the
following conditions, the Term Loan Maturity Date shall be extended for one year effective on the
date which, but for such extension, would have been the Term Loan Maturity Date as long as: (i) at
the time of the effectiveness of such extension, the aggregate



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outstanding principal balance of the Term Loans shall not exceed $200,000,000, in the case of the
first such extension, and $100,000,000, in the case of the second such extension, (ii) immediately
prior to such extension and immediately after giving effect thereto, (x) no Default or Event of
Default shall exist and (y) the representations and warranties made or deemed made by the Borrower
and each other Loan Party in the Loan Documents to which any of them is a party, shall be true and
correct in all material respects on and as of the date of such extension with the same force and
effect as if made on and as of such date except to the extent that such representations and
warranties expressly relate solely to an earlier date (in which case such representations and
warranties shall have been true and correct in all material respects on and as of such earlier
date) and except for changes in factual circumstances not prohibited under the Loan Documents and
(iii) the Borrower shall have paid the Fees payable under Section 3.6.(d).



     (c) Extension of Term Loan Maturity Date With Rating. Subject to the following
subsection (d), the Borrower shall have the right, exercisable two times, to extend the Term Loan
Maturity Date by one year pursuant to this subsection. The Borrower may exercise such right only
by executing and delivering to the Agent at least 90 days but not more than 180 days prior to the
current Term Loan Maturity Date, a written request for such extension, such request to specify that
it is being made pursuant to this subsection (as opposed to the preceding subsection (b)). The
Agent shall forward to each Lender a copy of such a request delivered to the Agent promptly upon
receipt thereof. Subject to delivery to the Agent of such a request and satisfaction of the
following conditions, the Term Loan Maturity Date shall be extended for one year effective on the
date which, but for such extension, would have been the Term Loan Maturity Date so long as: (i) at
the time of the effectiveness of such extension, the Parent and the Term Loans shall have been
assigned a Credit Rating, (ii) immediately prior to such extension and immediately after giving
effect thereto, (x) no Default or Event of Default shall exist and (y) the representations and
warranties made or deemed made by the Borrower and each other Loan Party in the Loan Documents to
which any of them is a party, shall be true and correct in all material respects on and as of the
date of such extension with the same force and effect as if made on and as of such date except to
the extent that such representations and warranties expressly relate solely to an earlier date (in
which case such representations and warranties shall have been true and correct in all material
respects on and as of such earlier date) and except for changes in factual circumstances not
prohibited under the Loan Documents and (iii) the Borrower shall have paid the Fees payable under
Section 3.6.(d).



     (d) Combining Extension Options for Term Loan. The Borrower may only request a total
of two extensions of the Term Loan Maturity Date pursuant to this Section. Both such extensions
may be pursuant to the preceding subsection (b), both such extensions may be pursuant to the
preceding subsection (c), or the first such extension may be pursuant to the preceding subsection
(b) followed by a second extension pursuant to the preceding subsection (c). If the Borrower
requests the first such extension pursuant to the preceding subsection (c), it may only requests a
second extension pursuant to such subsection and not pursuant to subsection (b).



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




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



Section 2.14. Amount Limitations.




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



Article III. Payments, Fees and Other General Provisions




Section 3.1. Payments.




     Except to the extent otherwise provided herein, all payments of principal, interest and other
amounts to be made by the Borrower under this Agreement or any other Loan Document shall be made in
Dollars, in immediately available funds, without deduction, set-off or counterclaim, to the Agent
at its Principal Office, not later than 2:00 p.m. on the date on which such payment shall become
due (each such payment made after such time on such due date to be deemed to have been made on the
next succeeding Business Day). Subject to Section 2.7. and Section 10.4., the Borrower may, at the
time of making each payment under this Agreement or any Note, specify to the Agent the amounts
payable by the Borrower hereunder to which such payment is to be applied. Each payment received by
the Agent for the account of a Lender under this Agreement or any Note shall be paid to such Lender
at the applicable Lending Office of such Lender no later than 5:00 p.m. on the date of receipt. If
the Agent fails to pay such amount to a Lender as provided in the previous sentence, the Agent
shall pay interest on such amount until paid at a rate per annum equal to the Federal Funds Rate
from time to time in effect. If the due date of any payment under this Agreement or any other Loan
Document would otherwise fall on a day which is not a Business Day such date shall be extended to
the next succeeding Business Day and interest shall be payable for the period of such extension.



Section 3.2. Pro Rata Treatment.




     Except to the extent otherwise provided herein: (a) each borrowing from the Revolving Lenders
under Section 2.1.(a) and 2.3.(e) shall be made from the Revolving Lenders, each payment of the
Fees under Section 3.6.(a), the first sentence of Section 3.6.(b) and Section



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3.6.(c) shall be made for the account of the Revolving Lenders, and each termination or reduction
of the amount of the Revolving Commitments under Section 2.11. shall be applied to the respective
Revolving Commitments of the Revolving Lenders, pro rata according to the amounts of their
respective Revolving Commitments; (b) each payment or prepayment of principal of Revolving Loans by
the Borrower shall be made for the account of the Revolving Lenders pro rata in accordance with the
respective unpaid principal amounts of the Revolving Loans held by them, provided that if
immediately prior to giving effect to any such payment in respect of any Revolving Loans the
outstanding principal amount of the Revolving Loans shall not be held by the Revolving Lenders pro
rata in accordance with their respective Revolving Commitments in effect at the time such Revolving
Loans were made, then such payment shall be applied to the Revolving Loans in such manner as shall
result, as nearly as is practicable, in the outstanding principal amount of the Revolving Loans
being held by the Revolving Lenders pro rata in accordance with their respective Revolving
Commitments; (c) each payment of interest on Revolving Loans by the Borrower shall be made for the
account of the Revolving Lenders pro rata in accordance with the amounts of interest on the
Revolving Loans then due and payable to the Revolving Lenders; (d) the making of Term Loans under
Section 2.2. shall be made by the Term Lenders, pro rata according to the amounts of their
respective Term Commitments; (e) except as otherwise provided in Section 2.7.(b)(ii), each payment
or prepayment of principal of Term Loans by the Borrower, and each payment of the Fees under
Section 3.6.(d), shall be made for the account of the Term Lenders pro rata in accordance with the
respective unpaid principal amounts of the Term Loans held by them; (f) each payment of interest on
Term Loans by the Borrower shall be made for the account of the Term Lenders pro rata in accordance
with the amounts of interest on the Term Loans then due and payable to the Term Lenders; (g) the
Conversion and Continuation of Revolving Loans or Term Loans of a particular Type (other than
Conversions provided for by Section 4.6.) shall be made pro rata among the applicable Lenders
holding such Loans according to the amounts of their respective Revolving Loans or Term Loans, as
the case may be, and the then current Interest Period for each Lender’s portion of each Loan of
such Type shall be coterminous; and (h) the Revolving Lenders’ participation in, and payment
obligations in respect of, Letters of Credit under Section 2.3., shall be pro rata in accordance
with their respective Revolving Commitments.




Section 3.3. Sharing of Payments, Etc.




     If a Lender shall obtain payment of any principal of, or interest on, any Loan made by it to
the Borrower under this Agreement, or shall obtain payment on any other Obligation owing by the
Borrower or any other Loan Party through the exercise of any right of set-off, banker’s lien or
counterclaim or similar right or otherwise or through voluntary prepayments directly to a Lender or
other payments made by the Borrower to a Lender not in accordance with the terms of this Agreement
and such payment should be distributed to the Lenders pro rata in accordance with Section 3.2. or
Section 10.4., as applicable, such Lender shall promptly purchase from the other Lenders
participations in (or, if and to the extent specified by such Lender, direct interests in) the
Loans made by the other Lenders or other Obligations owed to such other Lenders in such amounts,
and make such other adjustments from time to time as shall be equitable, to the end that all the
Lenders shall share the benefit of such payment (net of any reasonable expenses which may be
incurred by such Lender in obtaining or preserving such benefit) pro rata in accordance with
Section 3.2. or Section 10.4., as applicable. To such end, all the Lenders shall make appropriate
adjustments among themselves (by the resale of participations sold or otherwise) if



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such payment is rescinded or must otherwise be restored. The Borrower agrees that any Lender so
purchasing a participation (or direct interest) in the Loans or other Obligations owed to such
other Lenders may exercise all rights of set-off, banker’s lien, counterclaim or similar rights
with respect to such participation as fully as if such Lender were a direct holder of Loans in the
amount of such participation. Nothing contained herein shall require any Lender to exercise any
such right or shall affect the right of any Lender to exercise, and retain the benefits of
exercising, any such right with respect to any other indebtedness or obligation of the Borrower.



Section 3.4. Several Obligations.




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



Section 3.5. Minimum Amounts.




     (a) Borrowings and Conversions. Except as otherwise provided in Section 2.3.(e), each
borrowing of Base Rate Loans shall be in an aggregate minimum amount of $1,000,000 and integral
multiples of $100,000 in excess thereof. Each borrowing, Conversion and Continuation of LIBOR
Loans shall be in an aggregate minimum amount of $2,000,000 and integral multiples of $500,000 in
excess of that amount.



     (b) Prepayments. Each voluntary prepayment of Revolving Loans shall be in an
aggregate minimum amount of $100,000 and integral multiples of $100,000 in excess thereof (or, if
less, the aggregate principal amount of Revolving Loans then outstanding). Each voluntary
prepayment of Term Loans shall be in an aggregate minimum amount of $1,000,000 and integral
multiples of $100,000 in excess thereof (or, if less, the aggregate principal amount of Term Loans
then outstanding).



     (c) Reductions of Revolving Commitments. Each reduction of the Revolving Commitments
under Section 2.11. shall be in an aggregate minimum amount of $10,000,000 and integral multiples
of $5,000,000 in excess thereof.



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



Section 3.6. Fees.




     (a) Unused Fee. During the period from the Effective Date to but excluding the
Revolving Termination Date, the Borrower agrees to pay to the Agent for the account of the
Revolving Lenders an unused facility fee with respect to the average daily difference between the
(i) aggregate amount of the Revolving Commitments and (ii) the aggregate principal amount of all
outstanding Revolving Loans plus the aggregate amount of all Letter of Credit Liabilities (the
“Unused Amount”) in each case for the calendar quarter, or portion thereof, prior to the



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payment date. Such fee shall be computed by multiplying the Unused Amount with respect to such
quarter by the corresponding per annum rate set forth below:



	 	 	 	 	 
	Unused Amount	 	Unused Fee
	≥ 50% of the aggregate amount of Revolving Commitments
	 	 	0.20	%
	< 50% of the aggregate amount of Revolving Commitments
	 	 	0.125	%





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




     (b) Letter of Credit Fees. The Borrower agrees to pay to the Agent for the account of
each Lender a letter of credit fee at a rate per annum equal to the Applicable Margin for Revolving
Loans that are LIBOR Loans (or while an Event of Default exists, at a per annum rate equal to four
percent (4.0%)) times the daily average Stated Amount of each Letter of Credit for the period from
and including the date of issuance of such Letter of Credit (x) through and including the date such
Letter of Credit expires or is terminated or (y) to but excluding the date such Letter of Credit is
drawn in full and is not subject to reinstatement, as the case may be. The fees provided for in
the immediately preceding sentence shall be nonrefundable and payable in arrears on (i) the last
day of each March, June, September and December in each year, (ii) the Revolving Termination Date,
(iii) the date the Revolving Commitments are terminated or reduced to zero and (iv) thereafter from
time to time on demand of the Agent. In addition, the Borrower shall pay to the Agent for its own
account and not the account of any Lender, an issuance fee in respect of each Letter of Credit
equal to the greater of (i) $500 or (ii) one-eighth of one percent (0.125%) per annum on the
initial Stated Amount of such Letter of Credit payable (A) for the period from and including the
date of issuance of such Letter of Credit through and including the expiration date of such Letter
of Credit and (B) if the expiration date of any Letter of Credit is extended (whether as a result
of the operation of an automatic extension clause or otherwise), for the period from but excluding
the previous expiration date to and including the extended expiration date. The fees provided for
in the immediately preceding sentence shall be nonrefundable and payable upon issuance (or in the
case of an extension of the expiration date, on the previous expiration date). The Borrower shall
pay directly to the Agent from time to time on demand all commissions, charges, costs and expenses
in the amounts customarily charged by the Agent from time to time in like circumstances with
respect to the issuance of each Letter of Credit, drawings, amendments and other transactions
relating thereto.



     (c) Revolving Extension Fee. If the Borrower exercises its right to extend the
Revolving Termination Date in accordance with Section 2.12.(a), the Borrower agrees to pay to the
Agent for the account of each Revolving Lender a fee equal to one-quarter of one percent (0.25%) of
the amount of such Revolving Lender’s Revolving Commitment (whether or not utilized) at the time of
each such extension. Such fee shall be due and payable in full on the date which, but for such
extension, would have been the Revolving Termination Date.



     (d) Term Extension Fee. If the Borrower exercises its right to extend the Term Loan
Maturity Date in accordance with Section 2.12.(b), the Borrower agrees to pay to the Agent for the
account of each Term Lender a fee equal to one-eighth of one percent (0.125%) of the



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outstanding principal amount of such Term Lender’s Term Loan at the time of each such extension.
Such fee shall be due and payable in full on the date which, but for such extension, would have
been the Term Loan Maturity Date.



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



Section 3.7. Computations.




     Unless otherwise expressly set forth herein, any accrued interest on any Loan, any Fees or any
other Obligations due hereunder shall be computed on the basis of a year of 365 or 366 days, as
applicable, and the actual number of days elapsed; provided, however, interest on LIBOR Loans shall
be computed on the basis of a year of 360 days and the actual number of days elapsed.



Section 3.8. Usury.




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



Section 3.9. Agreement Regarding Interest and Charges.




     The parties hereto hereby agree and stipulate that the only charge imposed upon the Borrower
for the use of money in connection with this Agreement is and shall be the interest specifically
described in Sections 2.4.(a)(i) and (ii). Notwithstanding the foregoing, the parties hereto
further agree and stipulate that all agency fees, syndication fees, facility fees, closing fees,
letter of credit fees, underwriting fees, default charges, late charges, funding or “breakage”
charges, increased cost charges, attorneys’ fees and reimbursement for costs and expenses paid by
the Agent or any Lender to third parties or for damages incurred by the Agent or any Lender, in
each case in connection with the transactions contemplated by this Agreement and the other Loan
Documents, are charges made to compensate the Agent or any such Lender for underwriting or
administrative services and costs or losses performed or incurred, and to be performed or incurred,
by the Agent and the Lenders in connection with this Agreement and shall under no circumstances be
deemed to be charges for the use of money. All charges other than charges for the use of money
shall be fully earned and nonrefundable when due.



Section 3.10. Statements of Account.




     The Agent will account to the Borrower monthly with a statement of Loans, Letters of Credit,
accrued interest and Fees, charges and payments made pursuant to this Agreement and



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the other Loan Documents, and such account rendered by the Agent shall be deemed conclusive upon
Borrower absent manifest error. The failure of the Agent to deliver such a statement of accounts
shall not relieve or discharge the Borrower from any of its obligations hereunder.



Section 3.11. Defaulting Lenders.




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



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



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this Agreement to the extent the same relate to the period prior to the effective date of the
purchase) shall terminate on the date of purchase, and the Defaulting Lender shall promptly execute
all documents reasonably requested to surrender and transfer such interest to the purchaser or
assignee thereof, including an appropriate Assignment and Assumption and, notwithstanding Section
12.5.(b), shall pay to the Agent an assignment fee in the amount of $7,000. The purchase price for
the Commitments of a Defaulting Lender shall be equal to the amount of the principal balance of the
Loans outstanding and owed by the Borrower to the Defaulting Lender plus any accrued but unpaid
interest thereon and accrued but unpaid fees. Prior to payment of such purchase price to a
Defaulting Lender, the Agent shall apply against such purchase price any amounts retained by the
Agent pursuant to the last sentence of the immediately preceding subsection (a). The Defaulting
Lender shall be entitled to receive amounts owed to it by the Borrower under the Loan Documents
which accrued prior to the date of the default by the Defaulting Lender, to the extent the same are
received by the Agent from or on behalf of the Borrower. There shall be no recourse against any
Lender or the Agent for the payment of such sums except to the extent of the receipt of payments
from any other party or in respect of the Loans.



Section 3.12. Taxes.




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




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




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




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



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



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



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




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Article IV. Yield Protection, Etc.




Section 4.1. Additional Costs; Capital Adequacy.




     (a) Additional Costs. The Borrower shall promptly, and in any event within 3 Business
Days of demand by the Agent, pay to the Agent for the account of each affected Lender from time to
time such amounts as such Lender may determine to be necessary to compensate such Lender for any
costs incurred by such Lender that it determines are attributable to its making or maintaining of
any LIBOR Loans or its obligation to make any LIBOR Loans hereunder, any reduction in any amount
receivable by such Lender under this Agreement or any of the other Loan Documents in respect of any
of such Loans or such obligation or the maintenance by such Lender of capital in respect of its
Loans or its Commitments (such increases in costs and reductions in amounts receivable being herein
called “Additional Costs”), to the extent resulting from any Regulatory Change that: (i) changes
the basis of taxation of any amounts payable to such Lender under this Agreement or any of the
other Loan Documents in respect of any of such Loans or its Commitments (other than taxes, fees,
duties, levies, imposts, charges, deductions, withholdings or other charges which are excluded from
the definition of Taxes pursuant to the first sentence of Section 3.12.(a)); or (ii) imposes or
modifies any reserve, special deposit or similar requirements (other than Regulation D of the Board
of Governors of the Federal Reserve System or other reserve requirement to the extent utilized in
the determination of Adjusted LIBOR for such Loan) relating to any extensions of credit or other
assets of, or any deposits with or other liabilities of, such Lender, or any commitment of such
Lender (including, without limitation, the Commitments of such Lender hereunder); or (iii) has or
would have the effect of reducing the rate of return on capital of such Lender to a level below
that which such Lender could have achieved but for such Regulatory Change (taking into
consideration such Lender’s policies with respect to capital adequacy).



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



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



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




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



Section 4.2. Suspension of LIBOR Loans.




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




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




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


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




Section 4.3. Illegality.




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



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be suspended until such time as such Lender may again make and maintain LIBOR Loans (in which case
the provisions of Section 4.6. shall be applicable).



Section 4.4. Compensation.




     Except as otherwise provided in Section 2.7.(b)(iii), the Borrower shall pay to the Agent for
the account of each Lender, upon the request of such Lender through the Agent, such amount or
amounts as shall be sufficient (in the reasonable opinion of such Lender) to compensate it for any
loss, cost or expense that such Lender reasonably determines is attributable to:




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




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


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




Section 4.5. Affected Lenders.




     If (a) a Lender requests compensation pursuant to Section 3.12. or 4.1., and the Requisite
Lenders are not also doing the same, or (b) the obligation of any Lender to make LIBOR Loans or to
Continue, or to Convert Base Rate Loans into, LIBOR Loans shall be suspended pursuant to Section
4.1.(b) or 4.3. but the obligation of the Requisite Lenders shall not have been suspended under
such Sections, then, so long as there does not then exist any Default or Event of Default, the
Borrower may demand that such Lender (the “Affected Lender”), and upon such demand the Affected
Lender shall promptly, assign its Commitments to an Eligible Assignee subject to and in accordance
with the provisions of Section 12.5.(b) for a purchase price equal to the aggregate principal
balance of all Loans then owing to the Affected Lender plus any accrued but unpaid interest thereon
and accrued but unpaid fees owing to the Affected Lender, or any other amount as may be mutually
agreed upon by such Affected Lender and Eligible Assignee. Each of the Agent and the Affected
Lender shall reasonably cooperate in effectuating the replacement of such Affected Lender under
this Section, but at no time shall the Agent, such Affected Lender or any other Lender be obligated
in any way whatsoever to initiate any such replacement or to assist in finding an Eligible
Assignee. The exercise by the Borrower of its rights under this Section shall be at the Borrower’s
sole cost and expense and at no cost or expense to the Agent, the Affected Lender or any of the
other Lenders. The terms of this Section shall not in any way limit the Borrower’s obligation to
pay to any Affected Lender compensation



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owing to such Affected Lender pursuant to Section 3.12., 4.1. or 4.4. or any other applicable
provision hereto with respect to periods up to the date of replacement.



Section 4.6. Treatment of Affected Loans.




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




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




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


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




Section 4.7. Change of Lending Office.




     Each Lender agrees that it will use reasonable efforts to designate an alternate Lending
Office with respect to any of its Loans affected by the matters or circumstances described in
Section 3.12., 4.1. or 4.3. to reduce the liability of the Borrower or avoid the results provided
thereunder, so long as such designation is not disadvantageous to such Lender as determined by such
Lender in its sole discretion.



Section 4.8. Assumptions Concerning Funding of LIBOR Loans.




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



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sees fit and the foregoing assumption shall be used only for calculation of amounts payable under
this Article IV.



Article V. Conditions Precedent




Section 5.1. Initial Conditions Precedent.




     The obligation of the Lenders to make the proceeds of the Term Loans and Revolving Loans
provided to the Escrow Agent as contemplated by Sections 2.1.(d) and 2.2.(c) available to the
Borrower or its order, and otherwise to effect or permit the occurrence of the first Credit Event
hereunder, is subject to the following conditions precedent:



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




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




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




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




     (iv) the Pledge Agreement executed by each Pledgor existing as of the Effective Date;




     (v) all existing certificates representing any shares of Equity Interests pledged
pursuant to the Pledge Agreement, together with an undated stock power for each such
certificate executed in blank by a duly authorized officer of the Pledgor thereof, together
with an Acknowledgment and Consent, substantially in the form of Schedule 2 to the Pledge
Agreement, duly executed by any issuer of any Equity Interest pledged pursuant to the Pledge
Agreement that is not itself a party to the Pledge Agreement;




     (vi) the Security Agreement executed by the Parent, the Borrower and/or any Domestic
Subsidiary (other than an Excluded Subsidiary) having rights in any Mortgage Receivable, any
other Investment and any deposit account or securities account in which reserves for
furniture, fixtures and equipment are deposited, subjecting all such property to the Lien of
the Security Agreement, except to the extent prohibited pursuant to the terms of any
existing document, instrument or agreement to which the Borrower or any such Subsidiary a
party;




     (vii) except as otherwise provided in Section 5.3. each document (including, without
limitation, any UCC financing statement and any control agreement) required by the Pledge
Agreement, Security Agreement or under Applicable Law or reasonably deemed necessary or
appropriate by the Agent to be entered into, filed, registered or recorded in order to
create in favor of the Agent, for the benefit of the Lenders, a perfected first-priority
Lien in the Collateral granted under the Pledge Agreement and the



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Security Agreement, shall have been entered into, filed, registered or recorded or shall
have been delivered to the Agent and be in proper form for filing, registration or
recordation, as appropriate;




     (viii) results of a recent lien search in each of the jurisdictions in which UCC
financing statements or other filings or recordations should be made to evidence or perfect
security interests in Collateral, and such search shall reveal no Liens of record with
respect to any of the Collateral other than Permitted Liens of the type described in clause
(a) of the definition of Permitted Liens or Liens to be terminated prior to the Effective
Date;




     (ix) an opinion of counsel to the Loan Parties, addressed to the Agent and the Lenders,
addressing the matters set forth in Exhibit I and such other matters as the Agent may
reasonably request;




     (x) the articles of incorporation, articles of organization, certificate of limited
partnership or other comparable organizational instrument (if any) of the Borrower and each
other Loan Party certified as of a recent date by the Secretary of State of the state of
formation of such Loan Party;




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




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




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




     (xiv) a copy of the Merger Agreement and the Asset Purchase Agreement and any other
material Asset Purchase Documents requested by the Agent, together with all



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amendments and supplements thereto, certified by a senior officer of the Borrower to be
true, correct and complete copies and in full force and effect;




     (xv) copies of each opinion letter delivered pursuant to the Asset Purchase Agreement
in connection with the closing of the Acquisition, and if requested by the Agent, reliance
letters from the law firms delivering such opinions stating that the Agent and the Lenders
may rely on such opinion letters;




     (xvi) a certificate of the chief executive officer, chief financial officer or other
senior officer of the Borrower certifying that (A) all representations and warranties of the
Loan Parties contained in the Loan Documents are true, correct and complete in all material
respects (excluding any representation or warranty regarding the nonexistence of any Default
or Event of Default) and (B) no Material Adverse Effect (as defined in the Merger Agreement)
with respect to the Seller has occurred that would entitle the Parent or the Borrower to not
consummate the Acquisition;




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




     (xviii) a Compliance Certificate calculated as of December 31, 2006 (giving pro forma
effect to the Acquisition and the use of the proceeds of the Loans to be funded on the
Effective Date);




     (xix) a letter from the Administrative Agent under the Existing Credit Agreement
providing information regarding the payment in full of amounts outstanding under the
Existing Credit Agreement and providing for the termination thereof and the release of all
Liens securing any obligations owing thereunder;




     (xx) the Notice of Borrowing for the Revolving Loans to be made available to the
Borrower as contemplated by Section 2.1.(c) and the request from the Borrower for the Term
Loans described in Section 2.2.(b);




     (xxi) a certificate from the Parent’s chief executive officer or chief financial
officer to the effect that to such individual’s knowledge all conditions precedent to the
closing of the Acquisition (other than the payment of the Purchase Price (as defined in the
Asset Purchase Agreement)) shall have been satisfied or waived as permitted by this
Agreement; and




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



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




     (i) No litigation, action, suit, investigation or other arbitral, administrative or
judicial proceeding shall be pending or threatened which could reasonably be expected to



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materially and adversely affect the credit facilities being provided pursuant to the Loan
Documents; and




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



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




     Subject to the last sentence of this Section, the obligations of the Lenders to make the
proceeds of any Loans available to the Borrower or its order and of the Agent to issue Letters of
Credit are subject to the further condition precedent that: (a) no Default or Event of Default
shall exist as of the date of the making of such Loan or date of issuance of such Letter of Credit
or would exist immediately after giving effect thereto; and (b) the representations and warranties
made or deemed made by the Borrower and each other Loan Party in the Loan Documents to which any of
them is a party, shall be true and correct in all material respects on and as of the date of the
making of such Loan or date of issuance of such Letter of Credit with the same force and effect as
if made on and as of such date except to the extent that such representations and warranties
expressly relate solely to an earlier date (in which case such representations and warranties shall
have been true and correct in all material respects on and as of such earlier date) and except for
changes in factual circumstances not prohibited under the Loan Documents. Subject to the last
sentence of this Section, each Credit Event shall constitute a certification by the Borrower to the
effect set forth in the preceding sentence (both as of the date of the giving of notice relating to
such Credit Event and, unless the Borrower otherwise notifies the Agent prior to the date of such
Credit Event, as of the date of the occurrence of such Credit Event). In addition, if such Credit
Event is the making of a Loan or the issuance of a Letter of Credit, the Borrower shall be deemed
to have represented to the Agent and the Lenders at the time such Loan is made or Letter of Credit
issued that all conditions to the occurrence of such Credit Event contained in this Article V. have
been satisfied. Notwithstanding anything in the Loan Documents to the contrary, (i) the obligation
of the Lenders to make Loans on the Effective Date shall not be subject to (x) any condition that
no Default or Event of Default shall exist as of the Effective Date or would exist immediately
after giving effect thereto or (y) the accuracy of any representation or warranty regarding the
nonexistence of any Default or Event of Default and (ii) for purposes of determining whether the
Lenders are obligated to make Loans on the Effective Date, in lieu of the representation contained
in the first sentence Section 6.1.(k), the Parent and the Borrower shall be deemed to represent to
the Agent and the Lenders that no Material Adverse Effect (as defined in the Merger Agreement) with
respect to the Seller has occurred that would entitle the Parent or the Borrower to not consummate
the Acquisition; provided, however, the Agent and the Lenders do not intend this sentence to be,
and this



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sentence shall not be construed to be, a waiver by the Agent and the Lenders of any Default or
Event of Default that may exist.



Section 5.3. Post-Closing Deliveries.




     With respect to any Mortgage Receivable or other Investment evidencing Indebtedness secured
directly or indirectly by an interest in real property, notwithstanding Section 5.1.(a)(vii), the
Borrower shall (a) only be required to deliver to the Agent on or before the Effective Date the
original certificates and Instruments representing or evidencing any such Investments, in suitable
form for transfer by delivery or, as applicable, accompanied by the applicable Loan Party’s
endorsement, where necessary, or duly executed instruments of transfer or assignment in blank, all
in form and substance reasonably satisfactory to the Agent and (b) deliver, or cause to be
delivered, to the Agent not later than May 11, 2007, all other items required by Section
5.1.(a)(vii) with respect to all such Investments, including without limitation, such agreements as
the Agent may reasonably request to establish control over any such Investments.



Article VI. Representations and Warranties




Section 6.1. Representations and Warranties.




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



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



     (b) Ownership Structure. As of the Agreement Date (and after giving effect to the
Acquisition), Part I of Schedule 6.1.(b) is a complete and correct list of all Subsidiaries of the
Parent setting forth for each such Subsidiary, (i) the jurisdiction of organization of such
Subsidiary, (ii) each Person holding any Equity Interests in such Subsidiary, (iii) the nature of
the Equity Interests held by each such Person, (iv) the percentage of ownership of such Subsidiary
represented by such Equity Interests and (v) whether such Subsidiary is a Material Subsidiary, an
Excluded Subsidiary and/or a Foreign Subsidiary. Except as disclosed in such Schedule, as of the
Agreement Date (and after giving effect to the Acquisition) (i) each of the Parent and its
Subsidiaries owns, free and clear of all Liens (other than Permitted Liens (as defined in the
Pledge Agreement)), and has the unencumbered right to vote, all outstanding Equity Interests in
each Person shown to be held by it on such Schedule, (ii) all of the issued and outstanding capital
stock of each such Person organized as a corporation is validly issued, fully paid and
nonassessable and (iii) there are no outstanding subscriptions, options, warrants,



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commitments, preemptive rights or agreements of any kind (including, without limitation, any
stockholders’ or voting trust agreements) for the issuance, sale, registration or voting of, or
outstanding securities convertible into, any additional shares of capital stock of any class, or
partnership or other ownership interests of any type in, any such Person. As of the Agreement Date
(and after giving effect to the Acquisition) Part II of Schedule 6.1.(b) correctly sets forth all
Unconsolidated Affiliates of the Parent, including the correct legal name of such Person, the type
of legal entity which each such Person is, and all Equity Interests in such Person held directly or
indirectly by the Parent.



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



     (d) Compliance of Loan Documents with Laws, Etc. The execution, delivery and
performance of this Agreement and the other Loan Documents to which the Borrower or any other Loan
Party is a party in accordance with their respective terms and the borrowings and other extensions
of credit hereunder do not and will not, by the passage of time, the giving of notice, or both:
(i) require any Governmental Approval or violate any Applicable Law (including all Environmental
Laws) relating to the Borrower or any other Loan Party; (ii) conflict with, result in a breach of
or constitute a default under the organizational documents of the Borrower or any other Loan Party,
or any indenture, agreement or other instrument to which the Borrower or any other Loan Party is a
party or by which it or any of its respective properties may be bound, except to the extent the
exercise of remedies with respect to Equity Interests subject to the Lien of the Pledge Agreement
may require compliance with a “change of control” provision or other similar change in ownership
provision contained in an indenture, agreement or other instrument to which the issuer of such
Equity Interest is a party; or (iii) result in or require the creation or imposition of any Lien
upon or with respect to any property now owned or hereafter acquired by the Borrower or any other
Loan Party.



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



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



     (g) Existing Indebtedness. Schedule 6.1.(g) is, as of the Agreement Date (and after
giving effect to the Acquisition), a complete and correct listing of all Indebtedness of the Parent
and its Subsidiaries having an outstanding principal balance of $1,000,000 or more, including
without limitation, Guarantees of the Parent and its Subsidiaries.



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



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



     (j) Financial Statements. The Borrower has furnished to each Lender copies of the
audited consolidated balance sheets of the Parent and its consolidated Subsidiaries for the fiscal
years ending December 31, 2005 and December 31, 2006, and the related audited consolidated
statements of operations, cash flows and shareholders’ equity for the fiscal years ending on such
dates, with the opinions thereon of Ernst & Young LLP. Such financial statements (including in
each case related schedules and notes) present fairly, in all material respects and in accordance
with GAAP consistently applied throughout the periods involved, the consolidated financial position
of the Parent and its consolidated Subsidiaries as at their respective dates and the results of
operations and the cash flow for such periods. Neither the Parent nor any of its Subsidiaries has
on the Agreement Date any material contingent liabilities, liabilities, liabilities for taxes,
unusual or long-term commitments or unrealized or forward anticipated losses from any unfavorable
commitments that would be required to be set forth in its financial statements or in the notes
thereto, except as referred to or reflected or provided for in said financial statements.



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     (k) No Material Adverse Change. Subject to the last sentence of Section 5.2., since
December 31, 2006, there has been no material adverse change in the business, assets, liabilities,
financial condition, results of operations, business or prospects of the Parent and its
Subsidiaries taken as a whole. Each of the Parent, its Subsidiaries and the other Loan Parties is
Solvent.



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



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



     (n) Absence of Defaults. Neither the Parent, any Subsidiary nor any other Loan Party
is in default under its articles of incorporation, bylaws, partnership agreement or other similar
organizational documents, and no event has occurred, which has not been remedied, cured or waived,
which, in any such case: (i) constitutes a Default or an Event of Default; or (ii) constitutes, or
which with the passage of time, the giving of notice, or both, would constitute, a default or event
of default by the Parent, any Subsidiary or any other Loan Party under any agreement (other than
this Agreement) or judgment, decree or order to which the Borrower or any Subsidiary or other Loan
Party is a party or by which the Borrower or any Subsidiary or other Loan Party or any of their
respective properties may be bound where such default or event of default could, individually or in
the aggregate, reasonably be expected to have a Material Adverse Effect.



     (o) Environmental Laws. Each of the Parent, its Subsidiaries and the other Loan
Parties has obtained all Governmental Approvals which are required of them under Environmental Laws
and is in compliance with all terms and conditions of such Governmental Approvals except for those
the failure to obtain or to comply with could not reasonably be expected to have a Material Adverse
Effect. Except for any of the following matters that could not be reasonably expected to have a
Material Adverse Effect, (i) the Parent is not aware of, and has not received notice of, any past,
present, or future events, conditions, circumstances, activities, practices, incidents, actions, or
plans which, with respect to the Parent, its Subsidiaries and each other Loan Party, may interfere
with or prevent compliance or continued compliance



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with Environmental Laws, or may give rise to any common-law or legal liability, or otherwise form
the basis of any claim, action, demand, suit, proceeding, hearing, or study, based on or related to
the manufacture, processing, distribution, use, treatment, storage, disposal, transport, or
handling or the emission, discharge, release or threatened release into the environment, of any
Hazardous Material; and (ii) there is no civil, criminal, or administrative action, suit, demand,
claim, hearing, notice, or demand letter, notice of violation, investigation, or proceeding pending
or, to the Parent’s knowledge, threatened, against the Parent, its Subsidiaries and each other Loan
Party relating in any way to Environmental Laws.



     (p) Investment Company; Etc. None of the Parent, any Subsidiary or any other Loan
Party is (i) an “investment company” or a company “controlled” by an “investment company” within
the meaning of the Investment Company Act of 1940, as amended, or (ii) subject to any other
Applicable Law which purports to regulate or restrict its ability to borrow money or to consummate
the transactions contemplated by this Agreement or to perform its obligations under any Loan
Document to which it is a party.



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



     (r) Affiliate Transactions. Except as permitted by Section 9.10., none of the Parent,
any Subsidiary or any other Loan Party is a party to any transaction with an Affiliate.



     (s) Intellectual Property. Each of the Parent, each other Loan Party and each other
Subsidiary owns or has the right to use, under valid license agreements or otherwise, all material
patents, licenses, franchises, trademarks, trademark rights, service marks, service mark rights,
trade names, trade name rights, trade secrets and copyrights (collectively, “Intellectual
Property”) necessary to the conduct of its businesses as now conducted and as contemplated by the
Loan Documents, without known conflict with any patent, license, franchise, trademark, trademark
right, service mark, service mark right, trade secret, trade name, copyright or other proprietary
right of any other Person. The Parent, each other Loan Party and each other Subsidiary have taken
all such steps as they deem reasonably necessary to protect their respective rights under and with
respect to such Intellectual Property.



     (t) Business. As of the Agreement Date, the Parent and its Subsidiaries are engaged
in the business of acquiring, financing and owning hotel properties together with other business
activities incidental thereto.



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



     (v) Accuracy and Completeness of Information. No written information, report or other
papers or data (excluding financial projections and other forward looking statements)



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



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



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



     (y) Accuracy of Representations in Asset Purchase Documents. As of the Agreement
Date, the representations and warranties contained in the Asset Purchase Documents made by the
Parent, the Borrower or any other Subsidiary are true and correct in all material respects.



     (z) Acquisition. No provision of the Asset Purchase Agreement has been altered,
amended, waived or otherwise changed or supplemented in a manner that could reasonably be expected
to be materially adverse to the Agent or the Lenders. As of the Effective Date and after giving
effect to the application of the proceeds of the Revolving Loans and Term Loans as contemplated by
Section 7.8.(a), the Acquisition has been consummated in accordance with the terms of the Asset
Purchase Agreement (except as altered, amended, waived or otherwise changed or supplemented as
contemplated by the immediately preceding sentence).



Section 6.2. Survival of Representations and Warranties, Etc.




     All statements contained in any certificate, financial statement or other instrument delivered
by or on behalf of the Parent, any Subsidiary or any other Loan Party to the Agent or



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any Lender pursuant to or in connection with this Agreement or any of the other Loan Documents
(including, but not limited to, any such statement made in or in connection with any amendment
hereto or thereto or any statement contained in any certificate, financial statement or other
instrument delivered by or on behalf of the Parent prior to the Agreement Date and delivered to the
Agent or any Lender in connection with the underwriting or closing of the transactions contemplated
hereby) shall constitute representations and warranties made by the Parent to the Agent and the
Lenders under this Agreement. All representations and warranties made under this Agreement and the
other Loan Documents shall be deemed to be made at and as of the Agreement Date, the Effective
Date, the date on which any extension of the Revolving Termination Date is effectuated pursuant to
Section 2.12. and the date of the occurrence of any Credit Event, except to the extent that such
representations and warranties expressly relate solely to an earlier date (in which case such
representations and warranties shall have been true and correct in all material respects on and as
of such earlier date) and except for changes in factual circumstances not prohibited under the Loan
Documents. All such representations and warranties shall survive the effectiveness of this
Agreement, the execution and delivery of the Loan Documents and the making of the Loans and the
issuance of the Letters of Credit.



Article VII. Affirmative Covenants




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



Section 7.1. Preservation of Existence and Similar Matters.




     Except as otherwise permitted under Section 9.7., the Parent and the Borrower shall, and shall
cause each other Subsidiary and each other Loan Party to, preserve and maintain its respective
existence, rights, franchises, licenses and privileges in the jurisdiction of its incorporation or
formation and qualify and remain qualified and authorized to do business in each jurisdiction in
which the character of its properties or the nature of its business requires such qualification and
authorization and where the failure to be so authorized and qualified could reasonably be expected
to have a Material Adverse Effect.



Section 7.2. Compliance with Applicable Law.




     The Parent and the Borrower shall, and shall cause each other Subsidiary and each other Loan
Party to, comply with all Applicable Laws, including the obtaining of all Governmental Approvals,
the failure with which to comply could reasonably be expected to have a Material Adverse Effect.



Section 7.3. Maintenance of Property.




     In addition to the requirements of any of the other Loan Documents, the Parent and the
Borrower shall, and shall cause each other Subsidiary and other Loan Party to, (a) protect and
preserve all of its respective material properties, including, but not limited to, all Intellectual
Property, and maintain in good repair, working order and condition all tangible properties,



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ordinary wear and tear excepted, and (b) make or cause to be made all needed and appropriate
repairs, renewals, replacements and additions to such properties, so that the business carried on
in connection therewith may be properly and advantageously conducted at all times.



Section 7.4. Conduct of Business.




     The Parent and the Borrower shall, and shall cause each other Subsidiary and the other Loan
Parties to, carry on, their respective businesses as described in Section 6.1.(t).



Section 7.5. Insurance.




     In addition to the requirements of any of the other Loan Documents, the Parent and the
Borrower shall, and shall cause each other Subsidiary and other Loan Party to, maintain insurance
(on a replacement cost basis) with financially sound and reputable insurance companies against such
risks and in such amounts as is customarily maintained by Persons engaged in similar businesses or
as may be required by Applicable Law, and from time to time deliver to the Agent upon its request a
detailed list, together with copies of all certificates describing the policies of the insurance
then in effect (or copies of such policies if requested by the Agent), stating the names of the
insurance companies, the amounts and rates of the insurance, the dates of the expiration thereof
and the properties and risks covered thereby; in any event the Borrower shall, and shall cause each
of its Subsidiaries to, maintain insurance in such amounts as required by any document evidencing
Indebtedness to which any Borrower or its Subsidiaries are a party.



Section 7.6. Payment of Taxes and Claims.




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



Section 7.7. Visits and Inspections.




     The Parent and the Borrower shall, and shall cause each other Subsidiary and other Loan Party
to, permit representatives or agents of any Lender or the Agent, from time to time after reasonable
prior notice if no Event of Default shall be in existence, as often as may be reasonably requested,
but only during normal business hours and at the expense of such Lender or the Agent (unless a
Default or Event of Default shall exist, in which case the exercise by the Agent or such Lender of
its rights under this Section shall be at the expense of the Borrower), as the case may be, to: (a)
visit and visually inspect all properties of the Parent, the Borrower, such other Subsidiary or
such other Loan Party to the extent any such right to visit or inspect is within the



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control of such Person; (b) inspect and make extracts from their respective books and records,
including but not limited to management letters prepared by independent accountants; and (c)
discuss with its officers and employees, and its independent accountants, its business, properties,
condition (financial or otherwise), results of operations and performance. If requested by the
Agent, the Parent shall execute an authorization letter addressed to its accountants authorizing
the Agent or any Lender to discuss the financial affairs of the Parent, the Borrower, any other
Subsidiary and any other Loan Party with its accountants.



Section 7.8. Use of Proceeds; Letters of Credit.




     The Borrower shall use (a) the proceeds of the Revolving Loans and Term Loans to finance in
part the Acquisition in accordance with the Asset Purchase Agreement and to pay costs and expenses
related to the Acquisition and (b) the proceeds of the Revolving Loans and the Letters of Credit
for general corporate purposes. No part of the proceeds of any Loan or Letter of Credit will be
used (a) for the purpose of buying or carrying “margin stock” within the meaning of Regulation U of
the Board of Governors of the Federal Reserve System or to extend credit to others for the purpose
of purchasing or carrying any such margin stock or (b) to fund any operations in, to finance any
investments or activities in, or to make any payments to, a Sanctioned Person or Sanctioned Entity.



Section 7.9. Environmental Matters.




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



Section 7.10. Books and Records.




     The Parent and the Borrower shall, and shall cause each other Subsidiary and the other Loan
Parties to, maintain books and records pertaining to its respective business operations in



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such detail, form and scope as is consistent with good business practice and in accordance with
GAAP.



Section 7.11. Further Assurances.




     The Parent and the Borrower shall, at the sole cost and expense of the Parent and the Borrower
and upon request of the Agent, execute and deliver or cause to be executed and delivered, to the
Agent such further instruments, documents and certificates, and do and cause to be done such
further acts that may be reasonably necessary or advisable in the reasonable opinion of the Agent
to carry out more effectively the provisions and purposes of this Agreement and the other Loan
Documents or to perfect more fully or to renew the rights of the Agent and the Lenders with respect
to the Collateral (or with respect to any additions thereto or replacements or proceeds thereof or
with respect to any other property or assets hereafter acquired by any Loan Party which may be
deemed to be part of the Collateral) pursuant to any of the Loan Documents.



Section 7.12. Additional Guarantors and Pledges.




     (a) Requirement to Become Guarantor. Within 30 days of (i) any Person (other than an
Excluded Subsidiary or Foreign Subsidiary) becoming a Material Subsidiary after the Effective Date
or (ii) any Excluded Subsidiary that is a Material Subsidiary ceasing to be subject to the
restriction which prevented it from becoming a Guarantor on the Effective Date or delivering an
Accession Agreement pursuant to this Section, as the case may be, the Parent shall cause to be
delivered to the Agent each of the following in form and substance satisfactory to the Agent: (x)
an Accession Agreement and a supplement to the Security Agreement substantially in the form of
Annex 1 thereto, in each case, executed by such Subsidiary and (y) the items that would have been
delivered under Sections 5.1.(a)(vii) through (xiii) and (xxii) if such Subsidiary had been a
Guarantor on the Effective Date. The Borrower shall send to each Lender copies of each of the
foregoing items once the Agent has received all such items with respect to a Subsidiary.



     (b) Additional Pledges. Within 30 days of the Borrower or any Domestic Subsidiary
(other than an Excluded Subsidiary) acquiring, forming or otherwise receiving after the Effective
Date any Equity Interest in a Subsidiary (other than an Unpledgeable Subsidiary), the Parent shall
cause to be delivered to the Agent each of the following in form and substance satisfactory to the
Agent: (i) a supplement to the Pledge Agreement executed by the Borrower or such Domestic
Subsidiary, as applicable, subjecting such Equity Interests to the Lien of the Pledge Agreement,
(ii) the items that would have been delivered under Sections 5.1.(a)(v), (vii), (viii), (ix) and
(xxii) if such Subsidiary Equity Interests had been Collateral under the Pledge Agreement on the
Effective Date and (iii) if such Equity Interests are owned by a Domestic Subsidiary that is not
already a Guarantor, the items referred to in clauses (i) and (ii) of the immediately preceding
subsection (a). Notwithstanding the immediately preceding sentence of this subsection, (x) in no
event shall the Borrower and its Domestic Subsidiaries be required to subject to the Lien of the
Pledge Agreement or any other Loan Document more than 65% (or such greater percentage that, due to
a change in an Applicable Law after the Agreement Date, (A) could not reasonably be expected to
cause the undistributed earnings of such Foreign Subsidiary as determined for United States federal
income tax purposes to be treated as a deemed



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dividend to such Foreign Subsidiary’s United States parent and (B) could not reasonably be expected
to cause any material adverse tax consequences) of the issued and outstanding Equity Interest of a
Foreign Subsidiary entitled to vote (within the meaning of Treas. Reg. Section 1.956-2(c)(2))
determined on a collective basis, but (y) the Borrower and its Domestic Subsidiaries shall be
required to subject to the Lien of the Pledge Agreement 100% of the issued and outstanding Equity
Interest of a Foreign Subsidiary not entitled to vote (within the meaning of Treas. Reg. Section
1.956-2(c)(2)).



Section 7.13. Release of Guarantors and Pledges.




     (a) Release of Guarantor. The Borrower may request in writing that the Agent release,
and upon receipt of such request the Agent shall release a Guarantor from the Guaranty and Security
Agreement so long as: (i) such Guarantor qualifies, or will qualify simultaneously with its release
from the Guaranty, as an Excluded Subsidiary or has ceased to be, or simultaneously with its
release from the Guaranty will cease to be, a Material Subsidiary or a Subsidiary; (ii) no Default
or Event of Default shall then be in existence or would occur as a result of such release; and
(iii) the Agent shall have received such written request at least 5 Business Days prior to the
requested date of release. Delivery by the Borrower to the Agent of any such request shall
constitute a representation by the Borrower that the matters set forth in the preceding sentence
(both as of the date of the giving of such request and as of the date of the effectiveness of such
request) are true and correct with respect to such request.



     (b) Release of Pledge. The Borrower may request in writing that the Agent release,
and upon receipt of such request the Agent shall release the Equity Interests of a Subsidiary from
the Lien of the applicable Security Documents so long as: (i) such Subsidiary qualifies, or will
qualify simultaneously with the release of its Equity Interests from such Security Documents, as an
Unpledgeable Subsidiary or has ceased to be, or simultaneously with the release of its Equity
Interests from such Security Documents will cease to be, a Subsidiary; (ii) no Default or Event of
Default shall then be in existence or would occur as a result of such release; and (iii) the Agent
shall have received such written request at least 7 Business Days prior to the requested date of
release. Delivery by the Borrower to the Agent of any such request shall constitute a
representation by the Borrower that the matters set forth in the preceding sentence (both as of the
date of the giving of such request and as of the date of the effectiveness of such request) are
true and correct with respect to such request.



Section 7.14. REIT Status.




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



Section 7.15. Exchange Listing.




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



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Article VIII. Information




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



Section 8.1. Quarterly Financial Statements.




     As soon as available and in any event within 5 days after the same is required to be filed
with the Securities and Exchange Commission (but in no event later than 45 days after the end of
each of the first, second and third fiscal quarters of the Parent), the unaudited consolidated
balance sheet of the Parent and its Subsidiaries as at the end of such period and the related
unaudited consolidated statements of income, shareholders’ equity and cash flows of the Parent and
its Subsidiaries for such period, setting forth in each case in comparative form the figures as of
the end of and for the corresponding periods of the previous fiscal year, all of which shall be
certified by the chief executive officer or chief financial officer of the Parent, in his or her
opinion, to present fairly, in accordance with GAAP and in all material respects, the consolidated
financial position of the Parent and its Subsidiaries as at the date thereof and the results of
operations for such period (subject to normal year-end audit adjustments).



Section 8.2. Year-End Statements.




     As soon as available and in any event within 5 days after the same is required to be filed
with the Securities and Exchange Commission (but in no event later than 90 days after the end of
each fiscal year of the Parent), the audited consolidated balance sheet of the Parent and its
Subsidiaries as at the end of such fiscal year and the related audited consolidated statements of
income, shareholders’ equity and cash flows of the Parent and its Subsidiaries for such fiscal
year, setting forth in comparative form the figures as at the end of and for the previous fiscal
year, all of which shall be (a) certified by the chief executive officer or chief financial officer
of the Parent, in his or her opinion, to present fairly, in accordance with GAAP and in all
material respects, the consolidated financial position of the Parent and its Subsidiaries as at the
date thereof and the results of operations for such period and (b) accompanied by the report
thereon of independent certified public accountants of recognized national standing acceptable to
the Agent, whose certificate shall be unqualified and in scope and substance satisfactory to the
Requisite Lenders.



Section 8.3. Compliance Certificate.




     At the time financial statements are furnished pursuant to Sections 8.1. and 8.2., a
certificate substantially in the form of Exhibit J (a “Compliance Certificate”) executed by the
chief financial officer of the Parent: (a) setting forth in reasonable detail as at the end of such
quarterly accounting period, fiscal year, or other fiscal period, as the case may be, the
calculations required to establish whether or not the Parent was in compliance with the covenants
contained in Sections 9.1. and 9.4. and (b) stating that, to his or her knowledge, after due
inquiry, no Default or Event of Default exists, or, if such is not the case, specifying such
Default or Event of Default and its nature, when it occurred, whether it is continuing and the
steps being taken by



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the Parent and the Borrower with respect to such event, condition or failure. Together with the
delivery of each Compliance Certificate, the Parent shall deliver (i) a report, in form and detail
reasonably satisfactory to the Agent, setting forth a statement of funds from operations for the
fiscal period then ending; and (ii) a report, in form and detail reasonably satisfactory to the
Agent, setting forth a list of all Properties acquired by the Parent and its Subsidiaries since the
date of the delivery of the previous such report, such list to identify such Property’s name,
location, cost of acquisition, amount of related mortgage Indebtedness, if any, and the maturity of
such mortgage Indebtedness, and the net operating income for such Property for the immediately
preceding period of 12 consecutive months.



Section 8.4. Other Information.




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



     (b) Securities Filings. Within 5 Business Days of the filing thereof, copies of all
registration statements (excluding the exhibits thereto (unless requested by the Agent) and any
registration statements on Form S-8 or its equivalent), reports on Forms 10-K, 10-Q and 8-K (or
their equivalents) and all other periodic reports which the Parent, any Subsidiary or any other
Loan Party shall file with the Securities and Exchange Commission (or any Governmental Authority
substituted therefor) or any national securities exchange;



     (c) Shareholder Information. Promptly upon the mailing thereof to the shareholders of
the Parent generally, copies of all financial statements, reports and proxy statements so mailed
and promptly upon the issuance thereof copies of all press releases issued by the Parent, any
Subsidiary or any other Loan Party;



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



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action, if any, which the Parent or applicable member of the ERISA Group is required or proposes to
take;



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



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



     (g) Default. Notice of the occurrence of any of the following promptly upon a
Responsible Officer of the Parent obtaining knowledge thereof: (i) any Default or Event of Default
or (ii) any event which constitutes or which with the passage of time, the giving of notice, or
otherwise, would constitute a default or event of default by the Parent, any Subsidiary or any
other Loan Party under any Material Contract to which any such Person is a party or by which any
such Person or any of its respective properties may be bound;



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



     (i) Material Asset Sales. Prompt notice of the sale, transfer or other disposition of
any assets of the Parent, any Subsidiary or any other Loan Party having a book value in excess of
$20,000,000 to any Person other than the Parent, any Subsidiary or any other Loan Party;



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



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



Section 8.5. Electronic Delivery of Certain Information.




     (a) The Parent and the Borrower may deliver documents, materials and other information
required to be delivered pursuant to Article VIII. (collectively, “Information”) in an electronic
format acceptable to the Agent by e-mailing any such Information to an e-mail address of the Agent
as specified by the Agent from time to time. Any Information provided in such



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manner shall only be deemed to have been delivered to the Agent and the Lenders on the date on
which the Agent posts such Information on the Borrower’s behalf (which the Agent shall do promptly
upon receipt) on an internet or intranet website to which each Lender and the Agent has access,
whether a commercial, third-party website (such as Intralinks or SyndTrak) or a website sponsored
by the Agent (the “Platform”).



     (b) In addition, the Borrower and the Parent may deliver Information required to be delivered
pursuant to Sections 8.1., 8.2., and 8.4.(b) and (c) by posting any such Information to the
Parent’s internet website (as of the Agreement Date, www.ahtreit.com). Any such Information
provided in such manner shall only be deemed to have been delivered to the Agent or a Lender (i) on
the date on which the Agent or such Lender, as applicable, receives notice from the Borrower or the
Parent that such Information has been posted to the Parent’s internet website and (ii) only if such
Information is publicly available without charge on such website. If for any reason, the Agent or
a Lender either did not receive such notice or after reasonable efforts was unable to access such
website, then the Agent or such Lender, as applicable, shall not be deemed to have received such
Information. In addition to any manner permitted by Section 12.1., the Borrower and the Parent may
notify the Agent or a Lender that Information has been posted to such a website by causing an
e-mail notification to be sent to an e-mail address specified from time to time by the Agent or
such Lender, as applicable.



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



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



     (e) The Agent shall have no obligation to request the delivery or to maintain copies of any of
the Information or other materials referred to above, and in no event shall have any responsibility
to monitor compliance by the Parent or the Borrower with any such requests.



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Section 8.6. Public/Private Information.




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



Article IX. Negative Covenants




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



Section 9.1. Financial Covenants.




     The Parent shall not permit:



     (a) Maximum Leverage Ratio. The ratio of (i) Total Net Indebtedness to (ii) Total
Asset Value (excluding cash and cash equivalents), to exceed 0.750 to 1.00 at any time.



     (b) Minimum Fixed Charge Coverage Ratio. The ratio of (i) Adjusted EBITDA for the
period of four consecutive fiscal quarters of the Parent most recently ending to (ii) Fixed Charges
for such period, to be less than the ratio in the table below corresponding to the applicable
period:



	 	 	 
	Four-Quarter Period Ending	 	Ratio
	On or before December 31, 2008
	 	1.250 to 1.00
	After December 31, 2008 and on or before December 31, 2009
	 	1.350 to 1.00
	After December 31, 2009
	 	1.50 to 1.0






     (c) Minimum Tangible Net Worth. Tangible Net Worth at any time to be less than
(i) 915,000,000 plus (ii) 75.0% of the Net Proceeds of all Equity Issuances effected by the
Parent or any Subsidiary after the Effective Date (other than Equity Issuances to the Parent or any
Subsidiary).



     (d) Floating Rate Indebtedness. The ratio of (i) Floating Rate Indebtedness of the
Parent and its Subsidiaries determined on a consolidated basis to (ii) Total Indebtedness, to
exceed 0.50 to 1.00 at any time.



     (e) Assets Owned by Borrower and Guarantors. The amount of Adjusted Total Asset Value
attributable to assets directly owned by the Borrower and the Guarantors to be less than 95.0% of
Adjusted Total Asset Value at any time.



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Section 9.2. Restricted Payments.




     Subject to the following sentence, if a Default or Event of Default exists, the Parent shall
not, and shall not permit any of its Subsidiaries to, declare or make any Restricted Payment except
(a) to the Parent or any Subsidiary and (b) the Borrower may pay cash dividends to the Parent and
other holders of partnership interests in the Borrower with respect to any fiscal year ending
during the term of this Agreement to the extent necessary for the Parent to distribute, and the
Parent may so distribute, cash dividends to its shareholders in an aggregate amount not to exceed
the amount required to be distributed for the Parent to remain in compliance with Section 7.14. If
a Default or Event of Default specified in Section 10.1.(a), Section 10.1.(b), Section 10.1.(f) or
Section 10.1.(g) shall exist, or if as a result of the occurrence of any other Event of Default any
of the Obligations have been accelerated pursuant to Section 10.2.(a), the Parent shall not, and
shall not permit any Subsidiary to, make any Restricted Payments to any Person other than to the
Parent or any Subsidiary.



Section 9.3. Indebtedness.




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



Section 9.4. Certain Permitted Investments.




     The Parent and the Borrower shall not, and shall not permit any other Subsidiary to, make or
otherwise own Investments in Unconsolidated Affiliates and other Persons that are not Subsidiaries,
such that the aggregate value of such Investments (determined in a manner consistent with the
definition of Total Asset Value or, if not contemplated under the definition of Total Asset Value,
as determined in accordance with GAAP) of the Parent and its Subsidiaries exceeds 30.0% of Total
Asset Value at any time.



Section 9.5. Investments Generally.




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



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



     (b) Investments to (x) acquire Equity Interests of a Subsidiary or any other Person who after
giving effect to such acquisition would be a Subsidiary or (y) form a Subsidiary, so long as in
each case (i) immediately prior to such Investment, and after giving effect thereto, no



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Default or Event of Default is or would be in existence and (ii) the applicable terms and
conditions set forth in Section 7.12. are satisfied;



     (c) Investments in Unconsolidated Affiliates and other Persons that are not Subsidiaries, in
each case, to the extent permitted under Section 9.4.;



     (d) Investments in Cash Equivalents;



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



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



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



Section 9.6. Liens; Negative Pledges; Other Matters.




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



     (b) The Parent and the Borrower shall not, and shall not permit any other Subsidiary or other
Loan Party to, enter into, assume or otherwise be bound by any Negative Pledge except for a
Negative Pledge contained in (i) an agreement (x) evidencing Indebtedness which the Parent, the
Borrower or such other Subsidiary may create, incur, assume, or permit or suffer to exist under
Section 9.3., (y) which Indebtedness is secured by a Lien permitted to exist under the Loan
Documents, and (z) which prohibits the creation of any other Lien on (A) only the property securing
such Indebtedness as of the date such agreement was entered into or (B) if such property is owned
by an Excluded Subsidiary, the Equity Interests issued by such Excluded Subsidiary or any Excluded
Subsidiary that directly or indirectly owns Equity Interests in such Excluded Subsidiary; or (ii)
an agreement relating to the sale of a Subsidiary or assets pending such sale, provided that in any
such case the Negative Pledge applies only to the Subsidiary or the assets that are the subject of
such sale.



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



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



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




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



     (a) any of the actions described in the immediately preceding clauses (i) through (iii) may be
taken with respect to any Subsidiary or any other Loan Party (other than the Parent and the
Borrower) so long as immediately prior to the taking of such action, and immediately thereafter and
after giving effect thereto, no Default or Event of Default is or would be in existence;
notwithstanding the foregoing, any such Loan Party (other than the Parent and the Borrower) may
enter into a transaction of merger pursuant to which such Loan Party is not the survivor of such
merger only if (i) the Parent shall have given the Agent and the Lenders at least 10 Business Days’
prior written notice of such merger, such notice to include a certification to the effect that
immediately after and after giving effect to such action, no Default or Event of Default is or
would be in existence; (ii) if the survivor entity is a Subsidiary, all applicable terms and
conditions of Section 7.12. are complied with within 30 days of consummation of such merger; and
(iii) such Loan Party and the survivor entity each takes such other action and delivers such other
documents, instruments, opinions and agreements as the Agent may reasonably request consistent with
Section 7.11.;



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



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



Section 9.8. Fiscal Year.




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



Section 9.9. Modifications of Organizational Documents.




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



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Section 9.10. Transactions with Affiliates.




     The Borrower shall not, and shall not permit any of its Subsidiaries or any other Loan Party
to, permit to exist or enter into, any transaction (including the purchase, sale, lease or exchange
of any property or the rendering of any service) with any Affiliate (other than a Guarantor),
except (x) transactions in the ordinary course of and pursuant to the reasonable requirements of
the business of the Borrower or any of its Subsidiaries and upon fair and reasonable terms which
are no less favorable to the Borrower or such Subsidiary than would be obtained in a comparable
arm’s length transaction with a Person that is not an Affiliate and (y) transactions described on
Schedule 9.10.



Section 9.11. ERISA Exemptions.




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



Article X. Default




Section 10.1. Events of Default.




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



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



     (b) Default in Payment of Interest and Other Obligations. The Borrower shall fail to
pay when due any interest on any of the Loans or any of the other payment Obligations (other than
Obligations referred to in Section 10.1.(a)) owing by the Borrower under this Agreement or any
other Loan Document, or any other Loan Party shall fail to pay when due any payment Obligation
owing by such other Loan Party under any Loan Document to which it is a party, and such failure
shall continue for a period of 5 Business Days.



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



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



     (e) Indebtedness Cross-Default; Derivatives Contracts.




     (i) The Parent, the Borrower, any other Subsidiary or any other Loan Party shall fail
to pay when due and payable, within any applicable grace or cure period, the principal of,
or interest on, any Indebtedness (other than the Loans and Reimbursement Obligations and
Indebtedness in respect of Derivatives Contracts) having an aggregate outstanding principal
amount of $25,000,000 or more (“Material Indebtedness”);




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




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




     (iv) as a result of the failure of the Parent, the Borrower, any other Subsidiary or
any other Loan Party to perform or observe any term, covenant, condition or agreement
contained in any Derivatives Contract, any such Derivatives Contracts are terminated and the
aggregate Derivatives Termination Value of all such terminated Derivative Contracts owed by
the Parent, the Borrower, the other Subsidiaries and other Loan Parties as a result thereof
is $25,000,000 or more.



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



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due; (vi) make a general assignment for the benefit of creditors; (vii) make a conveyance
fraudulent as to creditors under any Applicable Law; or (viii) take any corporate or partnership
action for the purpose of effecting any of the foregoing.



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



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



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



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



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



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



     (m) Change of Control/Change in Management.




     (i) Any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”)), is or becomes the
“beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that
a Person will be deemed to have “beneficial ownership” of all securities that such Person
has the right to acquire, whether such right is exercisable immediately or only after the
passage of time), directly or indirectly, of more than 35.0% of the total voting power of
the then outstanding voting stock of the Parent;




     (ii) During any period of 12 consecutive months ending after the Agreement Date,
individuals who at the beginning of any such 12-month period constituted the Board of
Directors of the Parent (together with any new directors whose election by such Board or
whose nomination for election by the shareholders of the Parent was approved by a vote of at
least two-thirds of the directors then still in office who were either directors at the
beginning of such period or whose election or nomination for election was previously so
approved but excluding any director whose initial nomination for, or assumption of office
as, a director occurs as a result of an actual or threatened solicitation of proxies or
consents for the election or removal of one or more directors by any person or group other
than a solicitation for the election of one or more directors by or on behalf of the Board
of Directors) cease for any reason to constitute a majority of the Board of Directors of the
Parent then in office; or




     (iii) the Parent shall cease to own and control, directly or indirectly, at least 60.0%
of the outstanding Equity Interests of the Borrower; or




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



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     (n) Failure of Security. The Agent shall cease to have a valid and perfected first
priority Lien in any material portion of the Collateral, in each case, for any reason other than
the failure of the Agent to take any action within its control.



Section 10.2. Remedies Upon Event of Default.




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



     (a) Acceleration; Termination of Facilities.




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




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



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



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



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



Section 10.3. Remedies Upon Default.




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



Section 10.4. Allocation of Proceeds.




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




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




     (b) amounts due the Lenders in respect of fees and expenses due under Section 12.2.,
pro rata in the amount then due each Lender;




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




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




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




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




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



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Section 10.5. Collateral Account.




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



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



     (c) If a drawing pursuant to any Letter of Credit occurs on or prior to the expiration date of
such Letter of Credit, the Borrower and the Lenders authorize the Agent to use the monies deposited
in the Collateral Account and proceeds thereof to make payment to the beneficiary with respect to
such drawing or the payee with respect to such presentment.



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



     (e) So long as no Default or Event of Default exists, and to the extent amounts on deposit in
or credited to the Collateral Account exceed the aggregate amount of the Letter of Credit
Liabilities then due and owing, the Agent shall, from time to time, at the request of the Borrower,
deliver to the Borrower promptly upon the Agent’s receipt of such request from the Borrower, and in
any event within 3 Business Days of such receipt, against receipt but without any recourse,
warranty or representation whatsoever, such amount of the credit balances in the Collateral Account
as exceeds the aggregate amount of the Letter of Credit Liabilities at such time.



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



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Section 10.6. Performance by Agent.




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



Section 10.7. Rights Cumulative.




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



Article XI. The Agent




Section 11.1. Authorization and Action.




     Each Lender hereby appoints and authorizes the Agent to take such action as contractual
representative on such Lender’s behalf and to exercise such powers under this Agreement and the
other Loan Documents as are specifically delegated to the Agent by the terms hereof and thereof,
together with such powers as are reasonably incidental thereto. Not in limitation of the
foregoing, each Lender authorizes and directs the Agent to enter into the Loan Documents for the
benefit of the Lenders. Each Lender hereby agrees that, except as otherwise set forth herein, any
action taken by the Requisite Lenders in accordance with the provisions of this Agreement or the
Loan Documents, and the exercise by the Requisite Lenders of the powers set forth herein or
therein, together with such other powers as are reasonably incidental thereto, shall be authorized
and binding upon all of the Lenders. Nothing herein shall be construed to deem the Agent a trustee
or fiduciary for any Lender or to impose on the Agent duties or obligations other than those
expressly provided for herein. At the request of a Lender, the Agent will forward to such Lender
copies or, where appropriate, originals of the documents delivered to the Agent pursuant to this
Agreement or the other Loan Documents. The Agent will also furnish to any Lender, upon the request
of such Lender, a copy of any certificate or notice furnished to the Agent by the Parent, the
Borrower, any other Loan Party or any other Affiliate of the Borrower, pursuant to this Agreement
or any other Loan Document not already delivered to such Lender pursuant to the terms of this
Agreement or any such other Loan Document. As to any matters not expressly provided for by the
Loan Documents (including, without limitation, enforcement or collection of any of the
Obligations), the Agent shall not be required to exercise any discretion or take any



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action, but shall be required to act or to refrain from acting (and shall be fully protected in so
acting or refraining from acting) upon the instructions of the Requisite Lenders (or all of the
Lenders if explicitly required under any other provision of this Agreement), and such instructions
shall be binding upon all Lenders and all holders of any of the Obligations; provided, however,
that, notwithstanding anything in this Agreement to the contrary, the Agent shall not be required
to take any action which exposes the Agent to personal liability or which is contrary to this
Agreement or any other Loan Document or Applicable Law. Not in limitation of the foregoing, the
Agent shall not exercise any right or remedy it or the Lenders may have under any Loan Document
upon the occurrence of a Default or an Event of Default unless the Requisite Lenders (or all of the
Lenders if explicitly required under any provision of this Agreement) have so directed the Agent to
exercise such right or remedy.



Section 11.2. Agent’s Reliance, Etc.




     Notwithstanding any other provisions of this Agreement or any other Loan Documents, neither
the Agent nor any of its directors, officers, agents, employees or counsel shall be liable for any
action taken or omitted to be taken by it or them under or in connection with this Agreement or any
other Loan Document, except for its or their own gross negligence or willful misconduct as
determined by a court of competent jurisdiction in a final, non-appealable judgment. Without
limiting the generality of the foregoing, the Agent: (a) may treat the payee of any Note as the
holder thereof until the Agent receives written notice of the assignment or transfer thereof signed
by such payee and in form satisfactory to the Agent; (b) may consult with legal counsel (including
its own counsel or counsel for the Parent, the Borrower or any other Loan Party), independent
public accountants and other experts selected by it and shall not be liable for any action taken or
omitted to be taken in good faith by it in accordance with the advice of such counsel, accountants
or experts; (c) makes no warranty or representation to any Lender or any other Person and shall not
be responsible to any Lender or any other Person for any statements, warranties or representations
made by any Person in or in connection with this Agreement or any other Loan Document; (d) shall
not have any duty to ascertain or to inquire as to the performance or observance of any of the
terms, covenants or conditions of any of this Agreement or any other Loan Document or the
satisfaction of any conditions precedent under this Agreement or any Loan Document on the part of
the Parent, the Borrower or other Persons (except for the delivery to it of any certificate or
document specifically required to be delivered to it pursuant to Section 5.1.) or inspect the
property, books or records of the Parent, the Borrower or any other Person; (e) shall not be
responsible to any Lender for the due execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement or any other Loan Document, any other instrument or document
furnished pursuant thereto or any Collateral covered thereby or the perfection or priority of any
Lien in favor of the Agent on behalf of the Lenders in any such Collateral; and (f) shall incur no
liability under or in respect of this Agreement or any other Loan Document by acting upon any
notice, consent, certificate or other instrument or writing (which may be by telephone or telecopy)
believed by it to be genuine and signed, sent or given by the proper party or parties. Not in
limitation of the foregoing, the Agent shall have no obligation to the Lenders or to any other
Person to assure that the Collateral exists or is owned by any Loan Party or is cared for,
protected or insured or that the Liens granted to the Agent pursuant to the Security Documents have
been properly or sufficiently or lawfully created, perfected, protected or enforced or are entitled
to any particular priority, or to exercise or to continue exercising at all or in any manner or
under any duty of care, disclosure or fidelity any



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of the rights, authorities and powers granted or available to the Agent in any of the Loan
Documents, it being understood and agreed that in respect of the Collateral, or any act, omission
or event related thereto, the Agent may act in any manner it may reasonably deem appropriate given
the Agent’s own interest in the Collateral as one of the Lenders and that the Agent shall have no
duty or liability whatsoever to the Lenders in this regard, except for its gross negligence or
willful misconduct. The Lenders hereby authorize the Agent (i) to release any Lien granted to or
held by the Agent in any Collateral as provided in Section 7.13. or 12.10. and (ii) to release a
Guarantor from the Guaranty as provided in Section 7.13. Upon request by the Agent at any time, the
Lenders will confirm in writing the Agent’s authority to release particular types or items of
Collateral or a Guarantor pursuant to such Sections.



Section 11.3. Notice of Defaults.




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



Section 11.4. Wachovia as Lender.




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



Section 11.5. Approvals of Lenders.




     All communications from the Agent to any Lender requesting such Lender’s determination,
consent, approval or disapproval (a) shall be given in the form of a written notice to such Lender,
(b) shall be accompanied by a description of the matter or issue as to which such determination,
approval, consent or disapproval is requested, or shall advise such Lender where information, if
any, regarding such matter or issue may be inspected, or shall otherwise describe



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the matter or issue to be resolved, (c) shall include, if reasonably requested by such Lender and
to the extent not previously provided to such Lender, written materials and, as appropriate, a
brief summary of all oral information provided to the Agent by the Parent in respect of the matter
or issue to be resolved, and (d) shall include the Agent’s recommended course of action or
determination in respect thereof. Each Lender shall reply promptly, but in any event within 10
Business Days (or such lesser or greater period as may be specifically required under the Loan
Documents) of receipt of such communication. Except as otherwise provided in this Agreement,
unless a Lender shall give written notice to the Agent that it specifically objects to the
recommendation or determination of the Agent (together with a written explanation of the reasons
behind such objection) within the applicable time period for reply, such Lender shall be deemed to
have conclusively approved of or consented to such recommendation or determination.



Section 11.6. Lender Credit Decision, Etc.




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



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Section 11.7. Indemnification of Agent.




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



Section 11.8. Successor Agent.




     The Agent may resign at any time as Agent under the Loan Documents by giving written notice
thereof to the Lenders and the Borrower. The Agent may be removed as Agent under the Loan
Documents for gross negligence or willful misconduct upon 30-day’s prior written notice by all
Lenders (other than the Lender then acting as Agent) to the Agent and the Borrower. Upon any such
resignation or removal the Requisite Lenders shall have the right to appoint a successor Agent
which appointment shall, provided no Default or Event of Default exists, be subject to the
Borrower’s approval, which approval shall not be unreasonably withheld or



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delayed (except that the Borrower shall, in all events, be deemed to have approved each Lender and
its Affiliates as a successor Agent). If no successor Agent shall have been so appointed in
accordance with the immediately preceding sentence, and shall have accepted such appointment,
within 30 days after the resigning Agent’s giving of notice of resignation or the giving of notice
of the removal of the Agent, then the resigning or removed Agent may, on behalf of the Lenders,
appoint a successor Agent, which shall be a Lender, if any Lender shall be willing to serve, and
otherwise shall be a commercial bank having total combined assets of at least $50,000,000,000.
Upon the acceptance of any appointment as Agent hereunder by a successor Agent, such successor
Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and
duties of the retiring or removed Agent, and the retiring or removed Agent shall be discharged from
its duties and obligations under the Loan Documents. Such successor Agent shall issue letters of
credit in substitution for the Letters of Credit, if any, outstanding at the time of such
succession or shall make other arrangements satisfactory to the current Agent, in either case, to
assume effectively the obligations of the current Agent with respect to such Letters of Credit.
After any Agent’s resignation or removal hereunder as Agent, the provisions of this Article XI.
shall continue to inure to its benefit as to any actions taken or omitted to be taken by it while
it was Agent under the Loan Documents.



Section 11.9. Titled Agents.




     Each of the Titled Agents in each such respective capacity, assumes no responsibility or
obligation hereunder, including, without limitation, for servicing, enforcement or collection of
any of the Loans, or for any duties as an agent hereunder for the Lenders. The titles of the
Titled Agents are solely honorific and imply no fiduciary responsibility on the part of the Titled
Agents to the Agent, the Borrower or any Lender and the use of such titles does not impose on the
Titled Agents any duties or obligations greater than those of any other Lender or entitle the
Titled Agents to any rights other than those to which any other Lender is entitled.



Article XII. Miscellaneous




Section 12.1. Notices.




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



     If to the Borrower:





Ashford Hospitality Limited Partnership

14185 Dallas Parkway, Suite 1100

Dallas, Texas 75245

Attn: David Brooks, Chief Legal Officer

Telephone: (972) 778-9207

Telecopy: (972) 490-9605



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     If to the Agent:


Wachovia Bank, National Association

301 S. College Street, NC0172

Charlotte, North Carolina 28288

Attn: David M. Blackman

Telephone: (704) 374-6272

Telecopy: (704) 383-6205




     If to a Lender:


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

Administrative Details Form;



or, as to each party at such other address as shall be designated by such party in a written notice
to the other parties delivered in compliance with this Section. All such notices and other
communications shall be effective (i) if mailed, when received; (ii) if telecopied, when
transmitted; or (iii) if hand delivered or sent by overnight courier, when delivered.
Notwithstanding the immediately preceding sentence, all notices or communications to the Agent or
any Lender under Article II. shall be effective only when actually received. Neither the Agent nor
any Lender shall incur any liability to any Loan Party (nor shall the Agent incur any liability to
the Lenders) for acting upon any telephonic notice referred to in this Agreement which the Agent or
such Lender, as the case may be, believes in good faith to have been given by a Person authorized
to deliver such notice or for otherwise acting in good faith hereunder. Failure of a Person
designated to get a copy of a notice to receive such copy shall not affect the validity of notice
properly given to any other Person.




Section 12.2. Expenses.




     The Borrower agrees (a) to pay or reimburse the Agent for all of its reasonable out-of-pocket
costs and expenses incurred in connection with the preparation, negotiation and execution of, and
any amendment, supplement or modification to, any of the Loan Documents (including due diligence
expenses and travel expenses relating to closing), and the consummation of the transactions
contemplated thereby, including the reasonable fees and disbursements of counsel to the Agent and
costs and expenses in connection with the use of IntraLinks, Inc., SyndTrak or other similar
information transmission systems in connection with the Loan Documents, (b) to pay or reimburse the
Agent and the Lenders for all their reasonable costs and expenses incurred in connection with the
enforcement or preservation of any rights under the Loan Documents, including the reasonable fees
and disbursements of their respective counsel (including the allocated fees and expenses of
in-house counsel) and any payments in indemnification or otherwise payable by the Lenders to the
Agent pursuant to the Loan Documents, (c) to pay, and indemnify and hold harmless the Agent and the
Lenders from, any and all recording and filing fees and any and all liabilities with respect to, or
resulting from any failure to pay or delay in paying, documentary, stamp, excise and other similar
taxes, if any, which may be payable or determined to be payable in connection with the execution
and delivery of any of the Loan Documents, or consummation of any amendment, supplement or
modification of, or any waiver or consent under or in respect of, any Loan Document and (d) to the
extent not already covered



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by any of the preceding subsections, to pay or reimburse the Agent and the Lenders for all their
costs and expenses incurred in connection with any bankruptcy or other proceeding of the type
described in Section 10.1.(f) or 10.1.(g), including the reasonable fees and disbursements of
counsel to the Agent and any Lender, whether such fees and expenses are incurred prior to, during
or after the commencement of such proceeding or the confirmation or conclusion of any such
proceeding. If the Borrower shall fail to pay any amounts required to be paid by it pursuant to
this Section, the Agent and/or the Lenders may pay such amounts on behalf of the Borrower and
either deem the same to be Loans outstanding hereunder or otherwise Obligations owing hereunder.



Section 12.3. Setoff.




     Subject to Section 3.3. and in addition to any rights now or hereafter granted under
Applicable Law and not by way of limitation of any such rights, the Borrower hereby authorizes the
Agent, each Lender, each Affiliate of the Agent or any Lender, and each Participant, at any time
while an Event of Default exists, without prior notice to the Borrower or to any other Person, any
such notice being hereby expressly waived, but in the case of a Lender, an Affiliate of a Lender or
a Participant subject to receipt of the prior written consent of the Agent exercised in its sole
discretion, to set off and to appropriate and to apply any and all deposits (general or special,
including, but not limited to, indebtedness evidenced by certificates of deposit, whether matured
or unmatured) and any other indebtedness at any time held or owing by the Agent, such Lender, any
such Affiliate of the Agent or such Lender, or such Participant, to or for the credit or the
account of the Borrower against and on account of any of the Obligations, irrespective of whether
or not any or all of the Loans and all other Obligations have been declared to be, or have
otherwise become, due and payable as permitted by Section 10.2., and although such obligations
shall be contingent or unmatured.



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




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



     (b) EACH OF THE PARENT, THE BORROWER, THE AGENT AND EACH LENDER HEREBY AGREES THAT THE FEDERAL
DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK AND ANY STATE COURT LOCATED IN THE BUROUGH OF
MANHATTAN, NEW YORK, NEW YORK, SHALL HAVE JURISDICTION



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



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



Section 12.5. Successors and Assigns.




     (a) Successors and Assigns Generally. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective successors and
assigns permitted hereby, except that neither the Parent nor the Borrower may assign or otherwise
transfer any of its rights or obligations hereunder without the prior written consent of the Agent
and each Lender and no Lender may assign or otherwise transfer any of its rights or obligations
hereunder except (i) to an Eligible Assignee in accordance with the provisions of the immediately
following subsection (b), (ii) by way of participation in accordance with the provisions of the
immediately following subsection (d) or (iii) by way of pledge or assignment of a security interest
subject to the restrictions of the immediately following subsection (f) (and any other attempted
assignment or transfer by any party hereto shall be null and void). Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than the parties hereto,
their respective successors and assigns permitted hereby, Participants to the extent provided in
the immediately following subsection (d) and, to the extent expressly contemplated hereby, the
Affiliates and the partners, directors, officers, employees, agents and advisors of the Agent and
the Lenders and of their respective Affiliates) any legal or equitable right, remedy or claim under
or by reason of this Agreement.



     (b) Assignments by Lenders. Any Lender may at any time assign to one or more
assignees (an “Assignee”) all or a portion of its rights and obligations under this Agreement



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(including all or a portion of its Commitments and the Loans at the time owing to it);
provided that any such assignment shall be subject to the following conditions:





     (i) Minimum Amounts.




     (A) in the case of an assignment of the entire remaining amount of the
assigning Lender’s Commitment and the Loans at the time owing to it or in the case
of an assignment to a Lender, an Affiliate of a Lender or an Approved Fund, no
minimum amount need be assigned; and




     (B) in any case not described in the immediately preceding subsection (A), the
aggregate amount of the Commitment (which for this purpose includes Loans
outstanding thereunder) or, if the applicable Commitment is not then in effect, the
principal outstanding balance of the Loans of the assigning Lender subject to each
such assignment (determined as of the date the Assignment and Assumption with
respect to such assignment is delivered to the Agent or, if “Trade Date” is
specified in the Assignment and Assumption, as of the Trade Date) shall not be less
than $5,000,000 in the case of any assignment in respect of a Commitment, or
$1,000,000 in the case of any assignment in respect of a Term Loan, unless each of
the Agent and, so long as no Default or Event of Default shall exist, the Borrower
otherwise consents (each such consent not to be unreasonably withheld or delayed).




     (ii) Proportionate Amounts. Each partial assignment shall be made as an
assignment of a proportionate part of all the assigning Lender’s rights and obligations
under this Agreement with respect to the Loan or the Commitment assigned.




     (iii) Required Consents. No consent shall be required for any assignment
except to the extent required by clause (i)(B) of this subsection (b) and, in addition:




     (A) the consent of the Borrower (such consent not to be unreasonably withheld
or delayed) shall be required unless (x) a Default or Event of Default shall exist
at the time of such assignment or (y) such assignment is to a Lender, an Affiliate
of a Lender or an Approved Fund; and




     (B) the consent of the Agent (such consent not to be unreasonably withheld or
delayed) shall be required for assignments in respect of (x) a Commitment if such
assignment is to a Person that is not already a Lender with a Commitment, an
Affiliate of such Lender or an Approved Fund with respect to such Lender or (y) a
Term Loan to a Person who is not a Lender, an Affiliate of a Lender or an Approved
Fund.




     (iv) Assignment and Acceptance. The parties to each assignment shall execute
and deliver to the Agent an Assignment and Acceptance, together with a processing and
recordation fee of $3,500 for each assignment, and the assignee, if it is not a Lender,
shall deliver to the Agent an Administrative Details Form.



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     (v) No Assignment to Borrower. No such assignment shall be made to the
Borrower or any of the Borrower’s Affiliates or Subsidiaries.




     (vi) No Assignment to Natural Persons. No such assignment shall be made to a
natural person.


Subject to acceptance and recording thereof by the Agent pursuant to the immediately following
subsection (c), from and after the effective date specified in each Assignment and Acceptance, the
assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned
by such Assignment and Acceptance, have the rights and obligations of a Lender under this
Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by
such Assignment and Acceptance, be released from its obligations under this Agreement (and, in the
case of an Assignment and Acceptance covering all of the assigning Lender’s rights and obligations
under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be
entitled to the benefits of Sections 4.4., 12.2. and 12.9. and the other provisions of this
Agreement and the other Loan Documents as provided in Section 12.10. with respect to facts and
circumstances occurring prior to the effective date of such assignment. Any assignment or transfer
by a Lender of rights or obligations under this Agreement that does not comply with this paragraph
shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such
rights and obligations in accordance with the immediately following subsection (d).




     (c) Register. The Agent, acting solely for this purpose as an agent of the Borrower,
shall maintain at the Principal Office a copy of each Assignment and Acceptance delivered to it and
a register for the recordation of the names and addresses of the Lenders, and the Commitments of,
and principal amounts of the Loans owing to, each Lender pursuant to the terms hereof from time to
time (the “Register”). The entries in the Register shall be conclusive, and the Parent, the
Borrower, the Agent and the Lenders may treat each Person whose name is recorded in the Register
pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. The Register shall be available for inspection by the
Parent, the Borrower and any Lender, at any reasonable time and from time to time upon reasonable
prior notice.



     (d) Participations. Any Lender may at any time, without the consent of, or notice to,
the Parent, the Borrower or the Agent, sell participations to any Person (other than a natural
person or the Borrower or any of the Borrower’s Affiliates or Subsidiaries) (each, a “Participant”)
in all or a portion of such Lender’s rights and/or obligations under this Agreement (including all
or a portion of its Commitment and/or the Loans owing to it); provided that (i) such Lender’s
obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations and (iii) the
Parent, the Borrower, the Agent and the Lenders shall continue to deal solely and directly with
such Lender in connection with such Lender’s rights and obligations under this Agreement. Any
agreement or instrument pursuant to which a Lender sells such a participation shall provide that
such Lender shall retain the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any provision of this Agreement; provided



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that such agreement or instrument may provide that such Lender will not, without the consent of the
Participant, agree to any amendment, modification or waiver of any provision of any Loan Document
described in Section 12.6.(d) that adversely affects such Participant. Subject to the immediately
following subsection (e), the Borrower agrees that each Participant shall be entitled to the
benefits of Sections 3.12., 4.1., and 4.4. to the same extent as if it were a Lender and had
acquired its interest by assignment pursuant to paragraph (b) of this Section. To the extent
permitted by Applicable Law, each Participant also shall be entitled to the benefits of Section
12.3. as though it were a Lender, provided such Participant agrees to be subject to Section 3.3. as
though it were a Lender. Upon request from the Agent, a Lender shall notify the Agent and the
Borrower of the sale of any participation hereunder.



     (e) Limitations upon Participant Rights. A Participant shall not be entitled to
receive any greater payment under Sections 3.12., 4.1., and 4.4. than the applicable Lender would
have been entitled to receive with respect to the participation sold to such Participant, unless
the sale of the participation to such Participant is made with the Borrower’s prior written
consent. A Participant that would be a Foreign Lender if it were a Lender shall not be entitled to
the benefits of Section 3.12. unless the Borrower is notified of the participation sold to such
Participant and such Participant agrees, for the benefit of the Borrower and the Agent, to comply
with Section 3.12.(c) as though it were a Lender.



     (f) Certain Pledges. Any Lender may at any time pledge or assign a security interest
in all or any portion of its rights under this Agreement to secure obligations of such Lender,
including any pledge or assignment to secure obligations to a Federal Reserve Bank or central bank
or similar authority of a country other than the United States of America in which such Lender is
located; provided that no such pledge or assignment shall release such Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.



     (g) No Registration. Each Lender agrees that, without the prior written consent of
the Borrower and the Agent, it will not make any assignment hereunder in any manner or under any
circumstances that would require registration or qualification of, or filings in respect of, any
Loan or Note under the Securities Act or any other securities laws of the United States of America
or of any other jurisdiction.



Section 12.6. Amendments.




     (a) Except as otherwise expressly provided in this Agreement, any consent or approval required
or permitted by this Agreement or any other Loan Document to be given by the Lenders may be given,
and any term of this Agreement or of any other Loan Document may be amended, and the performance or
observance by the Parent, the Borrower or any other Loan Party or any Subsidiary of any terms of
this Agreement or such other Loan Document or the continuance of any Default or Event of Default
may be waived (either generally or in a particular instance and either retroactively or
prospectively) with, but only with, the written consent of the Requisite Lenders (and, in the case
of an amendment to any Loan Document, the written consent of each Loan Party a party thereto).



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     (b) Subject to the immediately following subsection (d), any term of this Agreement or of any
other Loan Document relating to the rights or obligations of the Revolving Lenders, and not any
other Lenders, may be amended, and the performance or observance by the Borrower or any other Loan
Party or any Subsidiary of any such terms may be waived (either generally or in a particular
instance and either retroactively or prospectively) with, and only with, the written consent of the
Requisite Revolving Lenders (and, in the case of an amendment to any Loan Document, the written
consent of each Loan Party a party thereto).



     (c) Subject to the immediately following subsection (d), any term of this Agreement or of any
other Loan Document relating to the rights or obligations of the Term Lenders, and not any other
Lenders, may be amended, and the performance or observance by the Borrower or any other Loan Party
or any Subsidiary of any such terms may be waived (either generally or in a particular instance and
either retroactively or prospectively) with, but only with, the written consent of the Requisite
Term Lenders (and, in the case of an amendment to any Loan Document, the written consent of each
Loan Party a party thereto).



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




     (i) increase the Commitment of any Lender, increase the aggregate amount of the
Commitments of all Lenders or subject the Lenders to any additional obligations;




     (ii) reduce the principal of, or principal payments due with respect to, or interest
that has accrued or the rates of interest that will be charged on the outstanding principal
amount of, any Loans or other Obligations;




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




     (iv) modify the definition of the term “Revolving Termination Date” (except as
contemplated under Section 2.12.(a)) or the term “Term Loan Maturity Date” (except as
contemplated under Section 2.12.(b) or (c)), or otherwise postpone any date fixed for any
payment of any principal of, or interest on, any Loans or any other Obligations (including
the waiver of any Default or Event of Default as a result of the nonpayment of any such
Obligations as and when due), or extend the expiration date of any Letter of Credit beyond
the Revolving Termination Date;




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




     (vi) modify the definition of the term “Requisite Lenders”, “Requisite Revolving
Lenders” or “Requisite Term Lenders” or otherwise modify in any other manner the number or
percentage of the Lenders required to make any determinations or waive any rights hereunder
or to modify any provision hereof, including without limitation, any modification of this
Section 12.6. if such modification would have such effect;



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     (vii) release any Guarantor from its obligations under the Guaranty (except as
otherwise permitted under Section 7.13.(a)) or release any material part of the Collateral
or any Pledgor or Grantor from any Security Document (except as otherwise permitted under
Section 7.13.(a) or (b), as applicable); or




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




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



     (e) No amendment, waiver or consent, unless in writing and signed by the Agent, in such
capacity, in addition to the Lenders required hereinabove to take such action, shall affect the
rights or duties of the Agent under this Agreement or any of the other Loan Documents.



     (f) Notwithstanding anything in this Section to the contrary, a Default or Event of Default
may not be waived for purposes of Section 5.2. without the prior written consent of the Requisite
Revolving Lenders.



     (g) No waiver shall extend to or affect any obligation not expressly waived or impair any
right consequent thereon and any amendment, waiver or consent shall be effective only in the
specific instance and for the specific purpose set forth therein. Except as otherwise provided in
Section 11.5., no course of dealing or delay or omission on the part of the Agent or any Lender in
exercising any right shall operate as a waiver thereof or otherwise be prejudicial thereto. Except
as otherwise explicitly provided for herein or in any other Loan Document, no notice to or demand
upon the Parent or the Borrower shall entitle the Parent or the Borrower to any other or further
notice or demand in similar or other circumstances.



Section 12.7. Nonliability of Agent and Lenders.




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



Section 12.8. Confidentiality.




     Each of the Agent and the Lenders agrees to maintain the confidentiality of the Information
(as defined below), except that Information may be disclosed (a) to its Affiliates and its
Affiliates’ respective partners, directors, officers, employees, agents, advisors and other
representatives (it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and instructed to keep such Information
confidential), (b) to the extent requested by, or required to be disclosed to, any nationally



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recognized rating agency or regulatory or similar authority (including any self-regulatory
authority, such as the National Association of Insurance Commissioners) having or purporting to
have jurisdiction over it, (c) to the extent required by Applicable Laws or regulations or by any
subpoena or similar legal process, (d) to any other party hereto, (e) in connection with the
exercise of any remedies under any Loan Document (or any Derivatives Contract with a Lender or the
Agent) or any action or proceeding relating to any Loan Document (or any such Derivatives Contract)
or the enforcement of rights hereunder or thereunder, (f) subject to an agreement containing
provisions substantially the same as those of this Section, to (i) any actual or proposed Assignee
or Participant, or (ii) any actual or prospective counterparty (or its advisors) to any swap or
derivative transaction relating to the Parent or the Borrower and its respective obligations, (g)
subject to each such Person being informed of the confidential nature of the Information and to
their agreement to keep such Information confidential, to (i) an investor or prospective investor
in securities issued by an Approved Fund that also agrees that Information shall be used solely for
the purpose of evaluating an investment in such securities issued by the Approved Fund, (ii) a
trustee, collateral manager, servicer, backup servicer, noteholder or secured party in securities
issued by an Approved Fund in connection with the administration, servicing and reporting on the
assets serving as collateral for securities issued by an Approved Fund, or (iii) a nationally
recognized rating agency that requires access to information regarding the Loan Parties, the Loans
and Loan Documents in connection with ratings issued in respect of securities issued by an Approved
Fund, (h) with the consent of the Borrower, (i) to Gold Sheets and other similar bank trade
publications, such information to consist of deal terms and other information customarily found in
such publications, and (j) to the extent such Information (x) becomes publicly available other than
as a result of a breach of this Section actually know by the Agent or such Lender to be a breach of
this Section or (y) becomes available to the Agent, any Lender or any Affiliate of the Agent or any
Lender on a nonconfidential basis from a source other than the Borrower or the Parent.
Notwithstanding the foregoing, the Agent and each Lender may disclose any such confidential
information, without notice to the Parent, the Borrower or any other Loan Party, to Governmental
Authorities in connection with any regulatory examination of the Agent or such Lender or in
accordance with the regulatory compliance policy of the Agent or such Lender. As used in this
Section, the term “Information” means all information received from the Parent, the Borrower, any
other Loan Party or any other Subsidiary or Affiliate relating to any Loan Party or any of their
respective businesses, other than any such information that is available to the Agent or any Lender
on a nonconfidential basis prior to disclosure by the Parent, the Borrower, any other Loan Party or
any other Subsidiary or Affiliate, provided that, in the case of any such information received from
the Borrower, any other Loan Party or any other Subsidiary or Affiliate after the date hereof, such
information is clearly identified at the time of delivery as confidential. Any Person required to
maintain the confidentiality of Information as provided in this Section shall be considered to have
complied with its obligation to do so if such Person has exercised the same degree of care to
maintain the confidentiality of such Information as such Person would accord to its own
confidential information.



Section 12.9. Indemnification.




     (a) The Borrower shall and hereby agrees to indemnify, defend and hold harmless the Agent,
each of the Lenders, any Affiliate of the Agent or any Lender, and their respective directors,
officers, shareholders, agents, employees and counsel (each referred to herein as an



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“Indemnified Party”) from and against any and all of the following (collectively, the “Indemnified
Costs”): losses, costs, claims, damages, liabilities, deficiencies, judgments or reasonable
expenses of every kind and nature (including, without limitation, amounts paid in settlement, court
costs and the reasonable fees and disbursements of counsel incurred in connection with any
litigation, investigation, claim or proceeding or any advice rendered in connection therewith, but
excluding losses, costs, claims, damages, liabilities, deficiencies, judgments or expenses
indemnification in respect of which is specifically covered by Section 3.12. or 4.1. or expressly
excluded from the coverage of such Section 3.12. or 4.1.) incurred by an Indemnified Party in
connection with, arising out of, or by reason of, any suit, cause of action, claim, arbitration,
investigation or settlement, consent decree or other proceeding (the foregoing referred to herein
as an “Indemnity Proceeding”) which is in any way related directly or indirectly to: (i) this
Agreement or any other Loan Document or the transactions contemplated thereby; (ii) the making of
any Loans or issuance of Letters of Credit hereunder; (iii) any actual or proposed use by the
Borrower of the proceeds of the Loans or Letters of Credit; (iv) the Agent’s or any Lender’s
entering into this Agreement; (v) the fact that the Agent and the Lenders have established the
credit facility evidenced hereby in favor of the Borrower; (vi) the fact that the Agent and the
Lenders are creditors of the Borrower and have or are alleged to have information regarding the
financial condition, strategic plans or business operations of the Parent, the Borrower and the
other Subsidiaries; (vii) the fact that the Agent and the Lenders are material creditors of the
Borrower and are alleged to influence directly or indirectly the business decisions or affairs of
the Parent, the Borrower and the other Subsidiaries or their financial condition; (viii) the
exercise of any right or remedy the Agent or the Lenders may have under this Agreement or the other
Loan Documents; (ix) any civil penalty or fine assessed by the OFAC against, and all reasonable
costs and expenses (including counsel fees and disbursements) incurred in connection with defense
thereof by, the Agent or any Lender as a result of conduct of the Parent, the Borrower, any other
Loan Party or any other Subsidiary that violates a sanction enforced by the OFAC; or (x) any
violation or non-compliance by the Parent, the Borrower or any other Subsidiary of any Applicable
Law (including any Environmental Law) including, but not limited to, any Indemnity Proceeding
commenced by (A) the Internal Revenue Service or state taxing authority or (B) any Governmental
Authority or other Person under any Environmental Law, including any Indemnity Proceeding commenced
by a Governmental Authority or other Person seeking remedial or other action to cause the Parent,
the Borrower or any other Subsidiary (or any of their respective properties) (or the Agent and/or
the Lenders as successors to the Borrower) to be in compliance with such Environmental Laws;
provided, however, that the Borrower shall not be obligated to indemnify any Indemnified Party for
(A) any acts or omissions of such Indemnified Party in connection with matters described in this
subsection to the extent arising from the gross negligence or willful misconduct of such
Indemnified Party, as determined by a court of competent jurisdiction in a final, non-appealable
judgment or (B) Indemnified Costs to the extent arising directly out of or resulting directly from
claims of one or more Indemnified Parties against another Indemnified Party.




     (b) The Borrower’s indemnification obligations under this Section 12.9. shall apply to all
Indemnity Proceedings arising out of, or related to, the foregoing whether or not an Indemnified
Party is a named party in such Indemnity Proceeding. In this regard, this indemnification shall
cover all Indemnified Costs of any Indemnified Party in connection with any deposition of any
Indemnified Party or compliance with any subpoena (including any



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subpoena requesting the production of documents). This indemnification shall, among other things,
apply to any Indemnity Proceeding commenced by other creditors of the Parent, the Borrower or any
Subsidiary, any shareholder of the Parent, the Borrower or any other Subsidiary (whether such
shareholder(s) are prosecuting such Indemnity Proceeding in their individual capacity or
derivatively on behalf of the any such Person), any account debtor of the Parent, the Borrower or
any other Subsidiary or by any Governmental Authority. If indemnification is to be sought
hereunder by an Indemnified Party, then such Indemnified Party shall notify the Borrower of the
commencement of any Indemnity Proceeding; provided, however, that the failure to so notify the
Borrower shall not relieve the Borrower from any liability that it may have to such Indemnified
Party pursuant to this Section 12.9.



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



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



     (e) An Indemnified Party may conduct its own investigation and defense of, and may formulate
its own strategy with respect to, any Indemnity Proceeding covered by this Section and, as provided
above, all Indemnified Costs incurred by such Indemnified Party shall be reimbursed by the
Borrower. No action taken by legal counsel chosen by an Indemnified Party in investigating or
defending against any such Indemnity Proceeding shall vitiate or in any way impair the obligations
and duties of the Borrower hereunder to indemnify and hold harmless each such Indemnified Party;
provided, however, that if (i) the Borrower is required to indemnify an Indemnified Party pursuant
hereto and (ii) the Borrower has provided evidence reasonably satisfactory to such Indemnified
Party that the Borrower has the financial wherewithal to reimburse such Indemnified Party for any
amount paid by such Indemnified Party with respect to such Indemnity Proceeding, such Indemnified
Party shall not settle or compromise any such Indemnity Proceeding without the prior written
consent of the Borrower (which consent shall not be unreasonably withheld or delayed).
Notwithstanding the foregoing, an Indemnified Party may settle or compromise any such Indemnity
Proceeding without the prior written consent of the Borrower where (x) no monetary relief is sought
against such Indemnified Party in such Indemnity Proceeding or (y) there is an allegation of a
violation of law by such Indemnified Party.



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



 - 98 - 









 





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



     (h) Notwithstanding anything to the contrary in this Section 12.9., the Borrower shall not be
required to indemnify the Indemnified Parties for more than one counsel, who shall be chosen by the
Agent, in a particular jurisdiction in respect of a particular matter unless the counsel chosen by
the Agent shall have advised in writing that a conflict of interest between or among the
Indemnified Parties exists..



Section 12.10. Termination; Survival.




     At such time as (a) all of the Commitments have been terminated, (b) all Letters of Credit
have terminated or expired, (c) none of the Lenders is obligated any longer under this Agreement to
make any Loans and (d) all Obligations (other than obligations which survive as provided in the
following sentence) have been paid and satisfied in full, this Agreement shall terminate and upon
the request of the Borrower, the Agent shall (without notice to, or vote or consent of, any Lender)
take such actions as shall be required to release its security interest in all Collateral, and to
release all guarantee obligations under any Loan Document. Any such release of guarantee
obligations shall be subject to the provision of Section 9 of the Guaranty providing for automatic
reinstatement as provided therein. The indemnities to which the Agent and the Lenders are entitled
under the provisions of Sections 3.12., 4.1., 4.4., 11.7., 12.2. and 12.9. and any other provision
of this Agreement and the other Loan Documents, and the provisions of Section 12.4., shall continue
in full force and effect and shall protect the Agent and the Lenders (i) notwithstanding any
termination of this Agreement, or of the other Loan Documents, against events arising after such
termination as well as before and (ii) at all times after any such party ceases to be a party to
this Agreement with respect to all matters and events existing on or prior to the date such party
ceased to be a party to this Agreement.



Section 12.11. Severability of Provisions.




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



Section 12.12. GOVERNING LAW.




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



Section 12.13. Patriot Act.




     The Lenders and the Agent each hereby notifies the Parent and the Borrower that pursuant to
the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law



 - 99 - 









 







October 26, 2001)), it is required to obtain, verify and record information that identifies the
Parent, the Borrower and the other Loan Parties, which information includes the name and address of
the Parent, the Borrower and the other Loan Parties and other information that will allow such
Lender or the Agent, as applicable, to identify the Parent, the Borrower and the other Loan Parties
in accordance with such Act.



Section 12.14. Counterparts.




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



Section 12.15. Obligations with Respect to Loan Parties.




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



Section 12.16. Limitation of Liability.




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



Section 12.17. Entire Agreement.




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



Section 12.18. Construction.




     The Agent, each Lender, the Parent and the Borrower acknowledge that each of them has had the
benefit of legal counsel of its own choice and has been afforded an opportunity to review this
Agreement and the other Loan Documents with its legal counsel and that this Agreement and



 - 100 - 









 







the other Loan Documents shall be construed as if jointly drafted by the Agent, each Lender, the
Parent and the Borrower.



[Signatures on Following Pages]





 - 101 - 










 





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



	 	 	 	 	 
	 	ASHFORD HOSPITALITY LIMITED PARTNERSHIP

By: Ashford OP General Partner LLC, its general partner

 	 
	 	          By:  	/s/ David Brooks
 	 
	 	 	Name:  	David Brooks 	 
	 	 	Title:  	Vice President 	 
	 



	 	 	 	 	 
	 	ASHFORD HOSPITALITY TRUST, INC.

 	 
	 	By:  	/s/ David Brooks
 	 
	 	 	Name:  	David Brooks    	 
	 	 	Title:  	Vice President 	 
	 



[Signatures Continued on Next Page]




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[Signature Page to Credit Agreement with Ashford Hospitality Limited Partnership]




	 	 	 	 	 
	 	WACHOVIA BANK, NATIONAL ASSOCIATION, as
   Agent and as a Lender

 	 
	 	By:  	/s/ Matthew Ricketts
 	 
	 	 	Name:  	Matthew Ricketts    	 
	 	 	Title:  	Vice President 	 
	 



[Signatures Continued on Next Page]




- 103 -









 








[Signature Page to Credit Agreement with Ashford Hospitality Limited Partnership]




	 	 	 	 	 
	 	MERRILL LYNCH BANK USA, as a Lender 

 	 
	 	By:  	/s/ Derek Betus
 	 
	 	 	Name:  	Derek Betus    	 
	 	 	Title:  	Vice President 	 
	 



[Signatures Continued on Next Page]




- 104 -









 








[Signature Page to Credit Agreement with Ashford Hospitality Limited Partnership]




	 	 	 	 	 
	 	MORGAN STANLEY SENIOR FUNDING, INC., 

as a Lender

 	 
	 	By:  	/s/ Daniel Twenge
 	 
	 	 	Name:  	Daniel Twenge    	 
	 	 	Title:  	Morgan Stanley Senior Funding Inc. 	 
	 



[Signatures Continued on Next Page]




- 105 -









 








[Signature Page to Credit Agreement with Ashford Hospitality Limited Partnership]




	 	 	 	 	 
	 	BANK OF AMERICA, N.A., as a Lender 

 	 
	 	By:  	/s/ Lesa J. Butler
 	 
	 	 	Name:  	Lesa J. Butler    	 
	 	 	Title:  	Senior Vice President 	 
	 



[Signatures Continued on Next Page]




- 106 -









 








[Signature Page to Credit Agreement with Ashford Hospitality Limited Partnership]




	 	 	 	 	 
	 	CALYON NEW YORK BRANCH, as a Lender 

 	 
	 	By:  	/s/ David Bowers
 	 
	 	 	Name:  	David Bowers    	 
	 	 	Title:  	Managing Director 	 
	 
	 	 	 
	 	By:  	                                      /s/ Joseph Asciolla
 	 
	 	 	Name:  	Joseph Asciolla    	 
	 	 	Title:  	Managing Director 	 
	 



[Signatures Continued on Next Page]




- 107 -









 








[Signature Page to Credit Agreement with Ashford Hospitality Limited Partnership]




	 	 	 	 	 
	 	AAREAL BANK AG, as a Lender 

 	 
	 	By:  	/s/ Stefan Kolle
 	 
	 	 	Name:  	Stefan Kolle    	 
	 	 	Title:  	Director, Credit Management-America 	 
	 
	 	 	 
	 	By:  	                                      /s/ Barbara Tracinski
 	 
	 	 	Name:  	Barbara Tracinski    	 
	 	 	Title:  	Credit Management Transaction Advisory
(Legal Advisory) 	 
	 



[Signatures Continued on Next Page]




- 108 -









 








[Signature Page to Credit Agreement with Ashford Hospitality Limited Partnership]




	 	 	 	 	 
	 	ROYAL BANK OF CANADA, as a Lender 

 	 
	 	By:  	/s/ Dan LePage
 	 
	 	 	Name:  	Dan LePage    	 
	 	 	Title:  	Attorney-in-Fact 	 
	 



[Signatures Continued on Next Page]




- 109 -









 








[Signature Page to Credit Agreement with Ashford Hospitality Limited Partnership]




	 	 	 	 	 
	 	CREDIT SUISSE, CAYMAN ISLANDS, as a Lender 

 	 
	 	By:  	/s/ Ian Nalitt
 	 
	 	 	Name:  	Ian Nalitt    	 
	 	 	Title:  	Managing Director 	 
	 
	 	 	 
	 	By:  	                                      /s/ James Neira
 	 
	 	 	Name:  	James Neira    	 
	 	 	Title:  	Associate 	 
	 



[Signatures Continued on Next Page]




- 110 -









 








[Signature Page to Credit Agreement with Ashford Hospitality Limited Partnership]




	 	 	 	 	 
	 	ALLIED IRISH BANKS, P.L.C., as a Lender 

 	 
	 	By:  	/s/ Brian Deegan
 	 
	 	 	Name:  	Brian Deegan    	 
	 	 	Title:  	Vice President 	 
	 



	 	 	 	 	 
	 	 	 
	 	By:  	                                      /s/ Kathryn E. Murdoch
 	 
	 	 	Name:  	Kathryn E. Murdoch    	 
	 	 	Title:  	Vice President 	 
	 



[Signatures Continued on Next Page]




- 111 -









 








[Signature Page to Credit Agreement with Ashford Hospitality Limited Partnership]




	 	 	 	 	 
	 	KEYBANK NATIONAL ASSOCIATION, as a Lender 

 	 
	 	By:  	/s/ Kevin P. Murray
 	 
	 	 	Name:  	Kevin P. Murray    	 
	 	 	Title:  	Vice President 	 
	 



[Signatures Continued on Next Page]




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SCHEDULE I




Commitments




	 	 	 	 	 	 	 	 	 
	                        Lender	 	Revolving Commitment	 	Term Loan Commitment
	Wachovia Bank, National Association
	 	$	25,000,000	 	 	$	85,000,000	 
	Merrill Lynch Bank USA
	 	$	22,000,000	 	 	$	50,000,000	 
	Morgan Stanley Senior Funding, Inc.
	 	$	22,000,000	 	 	$	50,000,000	 
	Bank of America, N.A.
	 	$	22,000,000	 	 	$	25,000,000	 
	Calyon New York Branch
	 	$	15,000,000	 	 	$	35,000,000	 
	Aareal Bank AG
	 	$	15,000,000	 	 	$	35,000,000	 
	Royal Bank of Canada
	 	$	15,000,000	 	 	$	20,000,000	 
	Credit Suisse, Cayman Islands Branch
	 	$	22,000,000	 	 	 	-0-	 
	Allied Irish Banks, p.l.c.
	 	$	22,000,000	 	 	 	-0-	 
	KeyBank National Association
	 	$	20,000,000	 	 	$	25,000,000	 







I-1 









 








EXHIBIT A




FORM OF ASSIGNMENT AND ASSUMPTION




     This Assignment and Assumption (the “Assignment and Assumption”) is dated as of the Effective
Date set forth below and is entered into by and between [the][each]1 Assignor identified
in item 1 below ([the][each, an] “Assignor”) and [the][each]2 Assignee identified in item
2 below ([the][each, an] “Assignee”). [It is understood and agreed that the rights and obligations
of [the Assignors][the Assignees]3 hereunder are several and not joint.]4
Capitalized terms used but not defined herein shall have the meanings given to them in the Credit
Agreement identified below (as amended, the “Credit Agreement”), receipt of a copy of which is
hereby acknowledged by [the][each] Assignee. The Standard Terms and Conditions set forth in Annex
1 attached hereto are hereby agreed to and incorporated herein by reference and made a part of this
Assignment and Assumption as if set forth herein in full.



     For an agreed consideration, [the][each] Assignor hereby irrevocably sells and assigns to [the
Assignee][the respective Assignees], and [the][each] Assignee hereby irrevocably purchases and
assumes from [the Assignor][the respective Assignors], subject to and in accordance with the
Standard Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by the
Administrative Agent as contemplated below (i) all of [the Assignor’s][the respective Assignors’]
rights and obligations in [its capacity as a Lender][their respective capacities as Lenders] under
the Credit Agreement and any other documents or instruments delivered pursuant thereto to the
extent related to the amount and percentage interest identified below of all of such outstanding
rights and obligations of [the Assignor][the respective Assignors] under the respective facilities
identified below (including without limitation any letters of credit, guarantees, and swingline
loans included in such facilities) and (ii) to the extent permitted to be assigned under applicable
law, all claims, suits, causes of action and any other right of [the Assignor (in its capacity as a
Lender)][the respective Assignors (in their respective capacities as Lenders)] against any Person,
whether known or unknown, arising under or in connection with the Credit Agreement, any other
documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in
any way based on or related to any of the foregoing the extent related to the amount and percentage
interest identified below, including, but not limited to, contract claims, tort claims, malpractice
claims, statutory claims and all other claims at law or in equity related to the rights and
obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold and
assigned by [the][any] Assignor to [the][any] Assignee pursuant to clauses (i) and (ii) above being
referred to herein collectively as [the][an] “Assigned Interest”). Each such sale and assignment
is without recourse to [the][any] Assignor and, except





 




			
	1	 	For bracketed language here and elsewhere in this
form relating to the Assignor(s), if the assignment is from a single Assignor,
choose the first bracketed language. If the assignment is from multiple
Assignors, choose the second bracketed language.
	 
	2	 	For bracketed language here and elsewhere in this
form relating to the Assignee(s), if the assignment is to a single Assignee,
choose the first bracketed language. If the assignment is to multiple
Assignees, choose the second bracketed language.
	 
	3	 	Select as appropriate.
	 
	4	 	Include bracketed language if there are either
multiple Assignors or multiple Assignees.




A-1









 









as expressly provided in this Assignment and Assumption, without representation or warranty by
[the][any] Assignor.




	 	 	 	 	 
	1. Assignor[s]:
	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	2. Assignee[s]:
	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 	 	[for each Assignee, indicate [Affiliate][Approved Fund] of [identify Lender]
	 
	 	 	 	 
	3. Borrower(s):	 	Ashford Hospitality Limited Partnership
	 
	 	 	 	 
	4. Administrative Agent:	 	Wachovia Bank, National Association, as the
administrative agent under the Credit Agreement
	 
	 	 	 	 
	5. Credit Agreement:	 	[Credit Agreement dated as of April
10, 2007 among Ashford Hospitality
Limited Partnership, the Lenders
parties thereto, Wachovia Bank,
National Association, as
Administrative Agent and the other
parties thereto]
	6. Assigned Interest[s]:
	 	 	 	 






	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	Aggregate Amount	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	of Commitment/	 	 	Amount of	 	 	Percentage Assigned	 	 	 	 
	Assignor[s]	 	Assignee[s]	 	 	Facility	 	 	Loans for all	 	 	Commitment/	 	 	of Commitment/	 	 	CUSIP	 
	5	 	6	 	 	Assigned7	 	 	Lenders8	 	 	Loans Assigned	 	 	Loans9	 	 	Number	 
	 
	 	 	 	 	 	 	 	 	 	$	 	 	 	$	 	 	 	 	%	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	$	 	 	 	$	 	 	 	 	%	 	 	 	 	 






[7. Trade Date: ______________]10




[Page break]






 




			
	5	 	List each Assignor, as appropriate.
	 
	6	 	List each Assignee, as appropriate.
	 
	7	 	Fill in the appropriate terminology for the types of
facilities under the Credit Agreement that are being assigned under this
Assignment (e.g. “Revolving Credit Commitment,” “Term Loan Commitment,” etc.)
	 
	8	 	Amount to be adjusted by the counterparties to take
into account any payments or prepayments made between the Trade Date and the
Effective Date.
	 
	9	 	Set forth, to at least 9 decimals, as a percentage of
the Commitment/Loans of all Lenders thereunder.
	 
	10	 	To be completed if the Assignor(s) and the
Assignee(s) intend that the minimum assignment amount is to be determined as of
the Trade Date.




A-2









 









Effective Date: ___, 20___[TO BE INSERTED BY ADMINISTRATIVE AGENT AND WHICH SHALL
BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.]



The terms set forth in this Assignment and Assumption are hereby agreed to:




	 	 	 	 	 	 	 	 	 
	 	 	ASSIGNOR[S]11	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	[NAME OF ASSIGNOR]	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:
	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	[NAME OF ASSIGNOR]	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	ASSIGNEE[S]12	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	[NAME OF ASSIGNEE]	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	[NAME OF ASSIGNEE]	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 	 	 





[Page Break]






 




			
	11	 	Add additional signature blocks as needed.
	 
	12	 	Add additional signature blocks as needed.




A-3









 










[Consented to and]13 Accepted:




[NAME OF ADMINISTRATIVE AGENT], as Agent




	 	 	 	 	 	 	 
	By:
	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:
	 	 	 	 
	 

	 	 	 	 	 	 





[Consented to:]14




[NAME OF RELEVANT PARTY]




	 	 	 	 	 	 	 
	By:
	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:
	 	 	 	 
	 

	 	 	 	 	 	 







 




			
	13	 	To be added only if the consent of the
Administrative Agent is required by the terms of the Credit Agreement.
	 
	14	 	To be added only if the consent of the Borrower
and/or other parties is required by the terms of the Credit Agreement.






A-4









 





ANNEX 1




[                                        ] 15




STANDARD TERMS AND CONDITIONS FOR

ASSIGNMENT AND ASSUMPTION




     1. Representations and Warranties.



     1.1 Assignor[s]. [The][Each] Assignor (a) represents and warrants that (i) it is the
legal and beneficial owner of [the][the relevant] Assigned Interest, (ii) [the][such] Assigned
Interest is free and clear of any lien, encumbrance or other adverse claim and (iii) it has full
power and authority, and has taken all action necessary, to execute and deliver this Assignment and
Assumption and to consummate the transactions contemplated hereby; and (b) assumes no
responsibility with respect to (i) any statements, warranties or representations made in or in
connection with the Credit Agreement or any other Loan Document, (ii) the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any collateral
thereunder, (iii) the financial condition of the Borrower, any of its Subsidiaries or Affiliates or
any other Person obligated in respect of any Loan Document or (iv) the performance or observance by
the Borrower, any of its Subsidiaries or Affiliates or any other Person of any of their respective
obligations under any Loan Document.



     1.2. Assignee[s]. [The][Each] Assignee (a) represents and warrants that (i) it has
full power and authority, and has taken all action necessary, to execute and deliver this
Assignment and Assumption and to consummate the transactions contemplated hereby and to become a
Lender under the Credit Agreement, (ii) it meets all the requirements to be an assignee under
Section 12.5.(b)(iii), (v) and (vi) of the Credit Agreement (subject to such consents, if any, as
may be required under Section 12.5.(b)(iii) of the Credit Agreement), (iii) from and after the
Effective Date specified for this Assignment and Assumption, it shall be bound by the provisions of
the Credit Agreement as a Lender thereunder and, to the extent of [the][the relevant] Assigned
Interest, shall have the obligations of a Lender thereunder, (iv) it is sophisticated with respect
to decisions to acquire assets of the type represented by the Assigned Interest and either it, or
the person exercising discretion in making its decision to acquire the Assigned Interest, is
experienced in acquiring assets of such type, (v) it has received a copy of the Credit Agreement,
and has received or has been accorded the opportunity to receive copies of the most recent
financial statements delivered pursuant to Section 8.1. or 8.2., as applicable, and such other
documents and information as it deems appropriate to make its own credit analysis and decision to
enter into this Assignment and Assumption and to purchase [the][such] Assigned Interest, (vi) it
has, independently and without reliance upon the Agent or any other Lender and based on such
documents and information as it has deemed appropriate, made its own credit analysis and decision
to enter into this Assignment and Assumption and to purchase [the][such] Assigned Interest, and
(vii) if it is a Foreign Lender, attached to the Assignment and Assumption is any documentation
required to be delivered by it pursuant to the terms of the Credit Agreement, duly completed and
executed by [the][such] Assignee; and (b) agrees that (i) it will, independently





 




			
	15	 	Describe Credit Agreement at option of
Administrative Agent.




A-5 









 









and without reliance on the Administrative Agent, [the][any] Assignor or any other Lender, and
based on such documents and information as it shall deem appropriate at the time, continue to make
its own credit decisions in taking or not taking action under the Loan Documents, and (ii) it will
perform in accordance with their terms all of the obligations which by the terms of the Loan
Documents are required to be performed by it as a Lender.




     2. Payments. From and after the Effective Date, the Agent shall make all payments in
respect of [the][each] Assigned Interest (including payments of principal, interest, fees and other
amounts) to [the][the relevant] Assignee whether such amounts have accrued prior to, on or after
the Effective Date specified for this Assignment and Assumption. The Assignor[s] and the
Assignee[s] shall make all appropriate adjustments in payments by the Agent for periods prior to
such Effective Date or with respect to the making of this assignment directly between themselves.



     3. General Provisions. This Assignment and Assumption shall be binding upon, and
inure to the benefit of, the parties hereto and their respective successors and assigns. This
Assignment and Assumption may be executed in any number of counterparts, which together shall
constitute one instrument. Delivery of an executed counterpart of a signature page of this
Assignment and Assumption by telecopy shall be effective as delivery of a manually executed
counterpart of this Assignment and Assumption. This Assignment and Assumption shall be governed
by, and construed in accordance with, the law of the State of New York.




A-6 









 








EXHIBIT B




FORM OF NOTICE OF BORROWING




                                        , 20__




Wachovia Bank, National Association, as Agent

One Wachovia Center

301 South College Street, NC0172

Charlotte, North Carolina 28288

Attention: David M. Blackman




Ladies and Gentlemen:




     Reference is made to that certain Credit Agreement dated as of April 10, 2007 (as amended,
restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and
among Ashford Hospitality Limited Partnership (the “Borrower”), the financial institutions party
thereto and their assignees under Section 12.5. thereof (the “Lenders”), Wachovia Bank, National
Association, as Agent (the “Agent”) and the other parties thereto. Capitalized terms used herein,
and not otherwise defined herein, have their respective meanings given them in the Credit
Agreement.




	1.	 	Pursuant to Section 2.1.(b) of the Credit Agreement, the Borrower hereby
requests that the Lenders make Revolving Loans to the Borrower in an aggregate
principal amount equal to $                                        .






	2.	 	The Borrower requests that such Revolving Loans be made available to the
Borrower on                     , 20___.






	3.	 	The Borrower hereby requests that the requested Revolving Loans all be of the
following Type:
	 
	 	 	[Check one box only]




o
Base Rate Loans

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




	 	 	 	 	 	 	 
	 

	 	[Check one box only]
	 	o
	 	1 month
	 

	 	 	 	o
	 	2 months
	 

	 	 	 	o
	 	3 months
	 

	 	 	 	o
	 	6 months







	4.	 	The proceeds of this borrowing of Revolving Loans will be used for the
following purpose:                                                                
                
	 
	 	 	 
 .




B-1 









 






	5.	 	The Borrower requests that the proceeds of this borrowing of Revolving Loans be
made available to the Borrower by                                                             .





     The Borrower hereby certifies to the Agent and the Lenders that as of the date hereof and as
of the date of the making of the requested Revolving Loans and after giving effect thereto, (a) no
Default or Event of Default exists, and (b) the representations and warranties made or deemed made
by the Borrower and each other Loan Party in the Loan Documents to which any of them is a party are
and shall be true and correct in all material respects with the same force and effect as if made on
and as of the date hereof, except to the extent that such representations and warranties expressly
relate solely to an earlier date (in which case such representations and warranties shall have been
true and correct in all material respects on and as of such earlier date) and except for changes in
factual circumstances not prohibited under the Loan Documents. In addition, the Borrower certifies
to the Agent and the Lenders that all conditions to the making of the requested Revolving Loans
contained in Article V. of the Credit Agreement will have been satisfied (or waived in accordance
with the applicable provisions of the Loan Documents) at the time such Revolving Loans are made.



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



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



	 	 	 	 	 	 	 	 	 	 	 
	 	 	ASHFORD HOSPITALITY LIMITED PARTNERSHIP

By: Ashford OP General Partner LLC, its general partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:	 	 	 	 
	 

	 	 	 	 	 	Title:
	 	 

	 	 
	 

	 	 	 	 	 	 	 	 

	 	 







B-2 









 








EXHIBIT C




FORM OF NOTICE OF CONTINUATION




                    , 20__




Wachovia Bank, National Association, as Agent

One Wachovia Center

301 South College Street, NC0172

Charlotte, North Carolina 28288

Attention: David M. Blackman




Ladies and Gentlemen:




     Reference is made to that certain Credit Agreement dated as of April 10, 2007 (as amended,
restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and
among Ashford Hospitality Limited Partnership (the “Borrower”), the financial institutions party
thereto and their assignees under Section 12.5. thereof (the “Lenders”), Wachovia Bank, National
Association, as Agent (the “Agent”) and the other parties thereto. Capitalized terms used herein,
and not otherwise defined herein, have their respective meanings given them in the Credit
Agreement.



     Pursuant to Section 2.8. of the Credit Agreement, the Borrower hereby requests a Continuation
of a borrowing of Loans under the Credit Agreement, and in that connection sets forth below the
information relating to such Continuation as required by such Section of the Credit Agreement:



1. The proposed date of such Continuation is , 20___.




	2.	 	The aggregate principal amount of Loans subject to the requested Continuation
is $                                         and was originally borrowed by the Borrower on
                    , 20___.






	3.	 	The portion of such principal amount subject to such Continuation is
$                                        .






	4.	 	The current Interest Period for each of the Loans subject to such Continuation
ends on                     , 20___.






	5.	 	The duration of the new Interest Period for each of such Loans or portion
thereof subject to such Continuation is:





	 	 	 	 	 	 	 
	 

	 	[Check one box only]
	 	o
	 	1 month
	 

	 	 	 	o
	 	2 months
	 

	 	 	 	o
	 	3 months
	 

	 	 	 	o
	 	6 months






C-1 









 






     If notice of the requested Continuation was given previously by telephone, this notice is to
be considered the written confirmation of such telephone notice required by Section 2.8. of the
Credit Agreement.



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



	 	 	 	 	 	 	 	 	 	 	 
	 	 	ASHFORD HOSPITALITY LIMITED PARTNERSHIP

By: Ashford OP General Partner LLC, its general partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:	 	 	 	 
	 

	 	 	 	 	 	Title:
	 	 

	 	 
	 

	 	 	 	 	 	 	 	 

	 	 







C-2 









 







EXHIBIT D




FORM OF NOTICE OF CONVERSION




                    , 20__




Wachovia Bank, National Association, as Agent

One Wachovia Center

301 South College Street, NC0172

Charlotte, North Carolina 28288

Attention: David M. Blackman




Ladies and Gentlemen:




     Reference is made to that certain Credit Agreement dated as of April 10, 2007 (as amended,
restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and
among Ashford Hospitality Limited Partnership (the “Borrower”), the financial institutions party
thereto and their assignees under Section 12.5. thereof (the “Lenders”), Wachovia Bank, National
Association, as Agent (the “Agent”) and the other parties thereto. Capitalized terms used herein,
and not otherwise defined herein, have their respective meanings given them in the Credit
Agreement.



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




	1.	 	The proposed date of such Conversion is                                         , 20___.
	 
	2.	 	The Loans to be Converted pursuant hereto are currently:





	 	 	 	 	 	 	 
	 

	 	[Check one box only]
	 	o
	 	Base Rate Loans
	 

	 	 	 	o
	 	LIBOR Loans







	3.	 	The aggregate principal amount of Loans subject to the requested Conversion is
$                                         and was originally borrowed

 by the Borrower on                        
                 ,
20___.
	 
	4.	 	The portion of such principal amount subject to such Conversion is
$                                        .




D-1 









 

\




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




o Base Rate Loans



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




	 	 	 	 	 	 	 
	 

	 	[Check one box only]
	 	o
	 	1 month
	 

	 	 	 	o
	 	2 months
	 

	 	 	 	o
	 	3 months
	 

	 	 	 	o
	 	6 months






     The Borrower hereby certifies to the Agent and the Lenders that as of the date hereof and as
of the date of the requested Conversion and after giving effect thereto, (a) no Default or Event of
Default exists or will exist (provided the certification under this clause (a) shall not be made in
connection with the Conversion of a Loan into a Base Rate Loan), and (b) the representations and
warranties made or deemed made by the Borrower and each other Loan Party in the Loan Documents to
which any of them is a party are and shall be true and correct in all material respects, except to
the extent that such representations and warranties expressly relate solely to an earlier date (in
which case such representations and warranties shall have been true and correct in all material
respects on and as of such earlier date) and except for changes in factual circumstances not
prohibited under the Loan Documents (provided the certification under this clause (b) shall not be
made in connection with the Conversion of a Loan into a Base Rate Loan).



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



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



	 	 	 	 	 	 	 	 	 	 	 
	 	 	ASHFORD HOSPITALITY LIMITED PARTNERSHIP

By: Ashford OP General Partner LLC, its general partner	 	 
	 

	 	 	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:	 	 	 	 
	 

	 	 	 	 	 	Title:
	 	 

	 	 
	 

	 	 	 	 	 	 	 	 

	 	 







D-2 










 





EXHIBIT E




FORM OF PLEDGE AGREEMENT




     THIS PLEDGE AGREEMENT dated as of April 10, 2007 executed and delivered by each of the
undersigned parties identified as “Pledgors” on the signature pages hereto and the other Persons
who may become Pledgors hereunder pursuant to the execution and delivery of a Pledge Agreement
Supplement substantially in the form of Annex 1 hereto (each a “Pledgor” and collectively, the
“Pledgors”) in favor of WACHOVIA BANK, NATIONAL ASSOCIATION, as Agent (the “Pledgee”).



     WHEREAS, pursuant to that certain Credit Agreement dated as of the date hereof (as amended,
restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and
among Ashford Hospitality Limited Partnership (the “Borrower”), the financial institutions from
time to time party thereto as “Lenders” and the Pledgee, the Lenders, the Pledgee and other parties
thereto have agreed to make available to the Borrower certain financial accommodations on the terms
and conditions contained in the Credit Agreement;



     WHEREAS, the Borrower and each of the other Pledgors, though separate legal entities, are
members of the same corporate family and have determined it to be in their mutual best interests to
obtain financing from the Lenders and the Pledgee through their collective efforts;



     WHEREAS, each Pledgor acknowledges that it will receive direct and indirect benefits from the
Lenders and the Pledgee making such financial accommodations available to the Borrower under the
Credit Agreement; and



     WHEREAS, it is a condition precedent to the extension of such financial accommodations under
the Credit Agreement that the Pledgors execute and deliver this Agreement, among other things, to
grant to the Pledgee for the benefit of the Lenders a security interest in the Collateral as
security for the Secured Obligations.



     NOW, THEREFORE, in consideration of the mutual agreements herein contained and for other good
and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the
parties, the parties agree as follows:



     Section 1. Definitions. Terms not otherwise defined herein are used herein with the
respective meanings given them in the Credit Agreement. Terms defined in the Uniform Commercial
Code as in effect in the State of New York shall have the respective definitions as so defined. In
addition, as used in this Agreement:



     “Bankruptcy Code” means United States Bankruptcy Code (11 U.S.C. Section 101 et seq.),
as in effect from time to time, and any successor statute thereto.



     “Collateral” has the meaning given such term in the first paragraph of Section 2 of
this Agreement.



E-1









 








     “Issuer” means with respect to an Equity Interest, the Person who issued such Equity
Interest and shall include each of the Persons identified as an Issuer on Schedule 1 attached
hereto (or any addendum or supplement thereto), and any successors thereto, whether by merger or
otherwise.



     “Proceeds” means all proceeds (including proceeds of proceeds) of any of the
Collateral including all: (a) rights, benefits, distributions, premiums, profits, dividends,
interest, cash, instruments, documents of title, accounts, contract rights, inventory, equipment,
general intangibles, payment intangibles, deposit accounts, chattel paper, and other property from
time to time received, receivable, or otherwise distributed in respect of or in exchange for, or as
a replacement of or a substitution for, any of the Collateral, or proceeds thereof (including any
cash, Equity Interests, or other instruments issued after any recapitalization, readjustment,
reclassification, merger or consolidation with respect to the Issuers and any security
entitlements, as defined in Section 8-102(a)(17) of the UCC, with respect thereto); (b) “proceeds,”
as such term is defined in Section 9-102(a)(64) of the UCC; (c) proceeds of any insurance,
indemnity, warranty, or guaranty (including guaranties of delivery) payable from time to time with
respect to any of the Collateral, or proceeds thereof; and (d) payments (in any form whatsoever)
made or due and payable to a Pledgor from time to time in connection with any requisition,
confiscation, condemnation, seizure or forfeiture of all or any part of the Collateral, or proceeds
thereof.



     “Secured Obligations” means, collectively, (a) with respect to the Borrower, the
unpaid principal of and interest on all Loans, all Reimbursement Obligations, all other Letter of
Credit Liabilities and all other indebtedness, liabilities, obligations, covenants and duties of
the Borrower owing to the Pledgee or any Lender (or, in the case of any Derivatives Contract, any
Affiliate of any Lender) of any kind, nature or description, under or in respect of the Credit
Agreement, any other Loan Document to which the Borrower is a party or any Derivatives Contract
entered into by the Borrower with any Person that is or was a Lender (or any Affiliate of any
Lender) at the time such Derivatives Contract was executed, whether direct or indirect, absolute or
contingent, due or to become due, contractual or tortious, liquidated or unliquidated, and
including all interest (including interest that accrues after the filing of a case under the
Bankruptcy Code) and any and all costs, fees (including reasonable attorneys fees), and expenses
which the Borrower is required to pay pursuant to any of the foregoing, under Applicable Law, or
otherwise and (b) with respect to any other Pledgor, all indebtedness, liabilities, obligations,
covenants and duties of such Pledgor owing to the Pledgee or any Lender (or, in the case of any
Derivatives Contract, any Affiliate of any Lender) of any kind, nature or description, under or in
respect of the Guaranty, any other Loan Document to which such Pledgor is a party or any
Derivatives Contract entered into by such Pledgor with any Person that is or was a Lender (or any
Affiliate of any Lender) at the time such Derivatives Contract was executed, whether direct or
indirect, absolute or contingent, due or to become due, contractual or tortious, liquidated or
unliquidated, and including all interest (including interest that accrues after the filing of a
case under the Bankruptcy Code) and any and all costs, fees (including reasonable attorneys fees),
and expenses which such Pledgor is required to pay or has guaranteed pursuant to any of the
foregoing, under Applicable Law, or otherwise.



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



E-2









 





     “UCC” means the Uniform Commercial Code as in effect in any applicable jurisdiction.



     Section 2. Pledge. As security for the prompt performance and payment in full of the
Secured Obligations, each Pledgor hereby pledges to the Pledgee for the benefit of the Lenders, and
grants to the Pledgee for the benefit of the Lenders a security interest in, all of such Pledgor’s
right, title and interest in, to and under the following (collectively, the “Collateral”):



     (a) all Equity Interests now or hereafter owned, acquired or held by such Pledgor, including
without limitation, the Equity Interests described in Schedule 1 attached hereto;



     (b) all other Investments of such Pledgor;



     (c) all payments due or to become due to such Pledgor in respect of any of the foregoing;



     (d) all of such Pledgor’s claims, rights, powers, privileges, authority, puts, calls, options,
security interests, liens and remedies, if any, in respect of any of the foregoing;



     (e) all of such Pledgor’s rights to exercise and enforce any and every right, power, remedy,
authority, option and privilege of such Pledgor relating to any of the foregoing including, without
limitation, any power to (i) terminate, cancel or modify any agreement, (ii) execute any
instruments and to take any and all other action on behalf of and in the name of such Pledgor in
respect of any of the foregoing and the applicable Issuer thereof, (iii) exercise voting rights or
make determinations, (iv) exercise any election (including, but not limited to, election of
remedies), (v) exercise any “put”, right of first offer or first refusal, or other option, (vi)
exercise any right of redemption or repurchase, (vii) give or receive any notice, consent,
amendment, waiver or approval, (viii) demand, receive, enforce, collect or receipt for any of the
foregoing, (ix) enforce or execute any checks, or other instruments or orders, and (x) file any
claims and to take any action in connection with any of the foregoing;



     (f) all certificates and instruments representing or evidencing any of the foregoing;



     (g) all other rights, titles, interests, powers, privileges and preferences pertaining to any
of the foregoing; and



     (h) all Proceeds of any of the foregoing.



     Section 3. Representations and Warranties. Each Pledgor hereby represents and
warrants to the Pledgee and the Lenders as follows:



     (a) Title and Liens. Such Pledgor is, and will at all times continue to be, the legal
and beneficial owner of the Collateral of such Pledgor. None of the Collateral is subject to any
adverse claim or other Lien other than Permitted Liens. No Person has control of any of the
Collateral other than the Pledgee.



E-3









 





     (b) Authorization. Such Pledgor has the right and power, and has taken all necessary
action to authorize it, to execute, deliver and perform this Agreement in accordance with its
terms. The execution, delivery and performance of this Agreement in accordance with its terms,
including the granting of the security interest hereunder, do not and will not, by the passage of
time, the giving of notice, or both: (i) require any Governmental Approval or violate any
Applicable Law (including any Environmental Law) relating to such Pledgor; (ii) conflict with,
result in a breach of or constitute a default under the organizational documents of such Pledgor,
or any indenture, agreement or other instrument to which such Pledgor is a party or by which it or
any of the Collateral of such Pledgor or its other property may be bound, except to the extent the
exercise of remedies with respect to Equity Interests subject to the Lien of this Agreement may
require compliance with a “change in control” provision or other similar change in ownership
provision contained in an indenture, agreement or other instrument to which the Issuer of such
Equity Interest is a party; or (iii) result in or require the creation or imposition of any Lien
upon or with respect to any of the Collateral of such Pledgor or such Pledgor’s other property
whether now owned or hereafter acquired.



     (c) Validity and Perfection of Security Interest. This Agreement is effective to
create in favor of the Pledgee, for the benefit of the Lenders, a legal, valid and enforceable
security interest in the Collateral. Such security interest will be perfected in the Collateral of
each Pledgor (i) with respect to any such Collateral that is a “security” (as such term is defined
in the UCC) and is evidenced by a certificate, when such Collateral is delivered to the Pledgee
with duly executed stock powers with respect thereto, (ii) with respect to any such Collateral that
is a “security” (as such term is defined in the UCC) but is not evidenced by a certificate, when
UCC financing statements in appropriate form are filed in the appropriate filing offices in the
jurisdiction of organization of such Pledgor or when control is established by the Pledgee over
such interests in accordance with the provision of Section 8-106 of the UCC, or any successor
provision, and (iii) with respect to any such Collateral that is not a “security” (as such term is
defined in the UCC), when UCC financing statements in appropriate form are filed in the appropriate
filing offices in the jurisdiction of organization of such Pledgor. Except as set forth in this
subsection, no action is necessary to perfect the security interest granted by any Pledgor under
this Agreement.



     (d) Pledged Equity Interests. The information set forth on Schedule 1 hereto with
respect to the Collateral of such Pledgor is true and correct.



     (e) Name, Organization, Etc. Such Pledgor’s exact legal name, type of legal entity,
jurisdiction of formation, organizational identification number and location of its chief executive
office are as set forth on Schedule 1. Except as set forth on such Schedule, since the date of
such Pledgor’s formation, such Pledgor has not changed its name or merged with or otherwise
combined its business with any other Person.



     (f) Authorization of Equity Interest. All Equity Interests which constitute
Collateral are duly authorized, validly issued, fully paid and nonassessable and are not subject to
preemptive rights of any Person.



E-4









 





     (g) Interests in Partnerships and LLCs. None of the Collateral consisting of an
interest in a partnership or in a limited liability company (i) is dealt in or traded on a
securities exchange or in securities markets, (ii) by its terms expressly provides that it is a
security governed by Article 8 of the UCC, (iii) is an investment company security, (iv) otherwise
constitutes a security or (v) constitutes a financial asset.



     Section 4. Covenants. Each Pledgor hereby unconditionally covenants and agrees as
follows:



     (a) No Liens; No Sale of Collateral. Such Pledgor will not create, assume, incur or
permit or suffer to exist any adverse claim or other Lien on any of the Collateral other than
Permitted Liens and shall not enter into any document, instrument or agreement (other than this
Agreement) which prohibits or purports to prohibit the creation or assumption of any Lien on any of
the Collateral. Except as expressly permitted by any Loan Document, such Pledgor will not sell,
lease, lend, assign, transfer or otherwise dispose of all or any portion of the Collateral (or any
interest therein).



     (b) Change of Name, Etc. Without giving the Pledgee at least 30-days’ prior written
notice and to the extent such action is not otherwise prohibited by any of the Loan Documents, such
Pledgor shall not: (i) change its name; (ii) reorganize or otherwise become formed under the laws
of another jurisdiction or (iii) become bound by a security agreement of another Person under
Section 9-203(d) of the UCC.



     (c) Defense of Title. Such Pledgor will warrant and defend its title to and ownership
of the Collateral of such Pledgor, at its sole cost and expense, against the claims of all Persons.



     (d) Delivery of Certificates, Etc. If a Pledgor shall receive any certificate
(including, without limitation, any certificate representing a stock and/or liquidating dividends,
other distributions in property, return of capital or other distributions made on or in respect of
the Collateral, whether resulting from a subdivision, combination or reclassification of
outstanding Equity Interests or received in exchange for Collateral or any part thereof or as a
result of any merger, consolidation, acquisition or other exchange of assets or on the liquidation,
whether voluntary or involuntary, or otherwise), instrument, option or rights in respect of any
Collateral, whether in addition to, in substitution of, as a conversion of, or in exchange for, any
Collateral, or otherwise in respect thereof, such Pledgor shall hold the same in trust for the
Pledgee and the Lenders and promptly deliver the same to the Pledgee in the exact form received,
duly indorsed by such Pledgor to the Pledgee, if required, together with an undated stock power
covering such certificate (or other appropriate instrument of transfer) duly executed in blank by
such Pledgor and with, if the Pledgee so requests, signature guaranteed, to be held by the Pledgee,
subject to the terms of this Agreement, as Collateral.



     (e) Uncertificated Securities. With respect to any Collateral that constitutes a
security and is not represented or evidence by a certificate or instrument, such Pledgor shall
cause the Issuer thereof either (i) to register the Pledgee as the registered owner of such
security or (ii) to agree in writing with the Pledgee and such Pledgor that such Issuer will comply
with the



E-5









 







instructions with respect to such security originated by the Pledgee without further consent of
such Pledgor.



     (f) Security Entitlements and Securities Accounts. With respect to any Collateral
consisting of a security entitlement or a securities account (other than any securities account, or
any security entitlement credited or required to be credited to a securities account, with an
individual average balance during any 30-day period of less than $100,000), such Pledgor shall, and
shall cause the applicable securities intermediary to, enter into an agreement with, and in form
and substance reasonably acceptable to, the Pledgee, granting control to the Pledgee over such
Collateral.



     (g) Additional Shares. Such Pledgor shall not permit any Issuer to issue any
additional Equity Interests unless such Equity Interests are pledged hereunder as provided herein.
Further, such Pledgor shall not permit any Issuer to amend or modify its articles or certificate of
incorporation, articles of organization, certificate of limited partnership, by-laws, operating
agreement, partnership agreement or other comparable organizational instrument in a manner which
would adversely affect the voting, liquidation, preference or other similar rights of any holder of
the Equity Interests pledged hereunder.



     (h) Issuer Acknowledgment. Such Pledgor shall, upon the Pledgee’s request therefor,
cause each Issuer of Collateral pledged by such Pledgor and which Issuer is not a Pledgor itself,
to execute and deliver to the Pledgee an Acknowledgment and Consent substantially in the form of
Schedule 2 attached hereto.



     Section 5. Voting Rights; Dividends, etc.



     (a) So long as no Event of Default exists:




     (i) each Pledgor shall be entitled to exercise any and all voting and/or consensual
rights and powers accruing to an owner of the Collateral or any part thereof for any purpose
not inconsistent with the terms and conditions of any of the Loan Documents or any agreement
giving rise to or otherwise relating to any of the Secured Obligations; and




     (ii) each Pledgor shall be entitled to retain and use any and all cash dividends or
interest paid on the Collateral in the normal course of the applicable Issuer’s business,
but any and all stock and/or liquidating dividends, other distributions in property, return
of capital or other distributions made on or in respect of the Collateral, whether resulting
from a subdivision, combination or reclassification of outstanding Equity Interests or
received in exchange for Collateral or any part thereof or as a result of any merger,
consolidation, acquisition or other exchange of assets or on the liquidation, whether
voluntary or involuntary, or otherwise, shall be and become part of the Collateral and, if
received by a Pledgor, shall forthwith be delivered to the Pledgee.


The Pledgee agrees to execute and deliver to a Pledgor, or cause to be executed and delivered to a
Pledgor, as appropriate, at the sole cost and expense of such Pledgor, all such proxies, powers




E-6









 







of attorney, dividend orders and other instruments as such Pledgor may reasonably request for the
purpose of enabling such Pledgor to exercise the voting and/or consensual rights and powers which
such Pledgor is entitled to exercise pursuant to clause (i) above and/or to receive the dividends
which such Pledgor is authorized to retain pursuant to clause (ii) above.




     (b) If an Event of Default exists, all rights of a Pledgor to exercise the voting and/or
consensual rights and powers which a Pledgor is entitled to exercise pursuant to subsection (a)(i)
above and/or to receive the dividends and distributions which a Pledgor is authorized to receive
and retain pursuant to subsection (a)(ii) above shall cease, and all such rights thereupon shall
become immediately vested in the Pledgee, which shall have the sole and exclusive right and
authority to exercise such voting and/or consensual rights and powers which any Pledgor shall
otherwise be entitled to exercise pursuant to subsection (a)(i) above and/or to receive and retain
the dividends and distributions which any Pledgor shall otherwise be authorized to retain pursuant
to subsection (a)(ii) above. Any and all money and other property paid over to or received by the
Pledgee pursuant to the provisions of this subsection (b) shall be retained by the Pledgee as
additional Collateral hereunder and shall be applied in accordance with the provisions of Section
7. If any Pledgor shall receive any dividends, distributions or other property which it is not
entitled to receive under this Section, such Pledgor shall hold the same in trust for the Pledgee
and the Lenders, without commingling the same with other funds or property of or held by such
Pledgor, and shall promptly deliver the same to the Pledgee, in the identical form received,
together with any necessary endorsements.



     Section 6. Remedies.



     In addition to any right or remedy that the Pledgee or any Lender may have under the other
Loan Documents or otherwise under Applicable Law, if an Event of Default shall exist, the Pledgee
may exercise any and all the rights and remedies of a secured party under the UCC and may otherwise
sell, assign, transfer, endorse and deliver the whole or, from time to time, any part of the
Collateral at a public or private sale or on any securities exchange, for cash, upon credit or for
other property, for immediate or future delivery, and for such price or prices and on such terms as
the Pledgee in its discretion shall deem appropriate. With respect to any Collateral held or
maintained with a securities intermediary, the Pledgee shall be entitled to notify such securities
intermediary that such securities intermediary should follow the entitlement orders of the Pledgee
and that such securities intermediary should no longer follow entitlement orders of the Pledgor,
without further consent of the Pledgor. The Pledgee shall have the right (in its sole and absolute
discretion) to register any Equity Interests which are part of the Collateral in its own name as
pledgee or the name of its nominee (as Pledgee or as sub-agent), endorsed or assigned in blank or
in favor of the Pledgee. The Pledgee shall be authorized at any sale (if it deems it advisable to
do so) to restrict the prospective bidders or purchasers to Persons who will represent and agree
that they are purchasing the Collateral for their own account in compliance with the Securities Act
and any other Applicable Law and upon consummation of any such sale the Pledgee shall have the
right to assign, transfer, endorse and deliver to the purchaser or purchasers thereof the
Collateral so sold. Each purchaser at any sale of Collateral shall take and hold the property sold
absolutely free from any claim or right on the part of any Pledgor, and each Pledgor hereby waives
(to the fullest extent permitted by Applicable Law) all rights of redemption, stay and/or appraisal
which such Pledgor now has or may at any time in the future



E-7









 







have under any Applicable Law now existing or hereafter enacted. Each Pledgor agrees that, to the
extent notice of sale shall be required by Applicable Law, at least 10 days’ prior written notice
to such Pledgor of the time and place of any public sale or the time after which any private sale
is to be made shall constitute reasonable notification. Any such public sale shall be held at such
time or times within ordinary business hours and at such place or places as the Pledgee may fix and
shall state in the notice or publication (if any) of such sale. At any such sale, the Collateral,
or portion thereof to be sold, may be sold in one lot as an entirety or in separate parcels, as the
Pledgee may determine in its sole and absolute discretion. The Pledgee shall not be obligated to
make any sale of the Collateral if it shall determine not to do so regardless of the fact that
notice of sale of the Collateral may have been given. The Pledgee may, without notice or
publication, adjourn any public or private sale or cause the same to be adjourned from time to time
by announcement at the time and place fixed for sale, and such sale may, without further notice, be
made at the time and place to which the same was so adjourned. In case the sale of all or any part
of the Collateral is made on credit or for future delivery, the Collateral so sold may be retained
by the Pledgee until the sale price is paid by the purchaser or purchasers thereof, but neither the
Pledgee nor any Lender shall incur any liability to any Pledgor in case any such purchaser or
purchasers shall fail to take up and pay for the Collateral so sold and, in case of any such
failure, such Collateral may be sold again upon like notice. At any public sale made pursuant to
this Agreement, the Pledgee, any Lender and any other holder of any of the Secured Obligations, to
the extent permitted by Applicable Law, may bid for or purchase, free from any right of redemption,
stay and/or appraisal on the part of any Pledgor (all said rights being also hereby waived and
released to the extent permitted by Applicable Law), any part of or all the Collateral offered for
sale. For purposes hereof, a written agreement to purchase all or any part of the Collateral shall
be treated as a sale thereof; the Pledgee shall be free to carry out such sale pursuant to such
agreement and no Pledgor shall be entitled to the return of any Collateral subject thereto,
notwithstanding the fact that after the Pledgee shall have entered into such an agreement all
Events of Default may have been remedied or the Secured Obligations may have been paid in full as
herein provided. Each Pledgor hereby waives any right to require any marshaling of assets and any
similar right. In addition to exercising the power of sale herein conferred upon it, the Pledgee
shall also have the option to proceed by suit or suits at law or in equity to foreclose this
Agreement and sell the Collateral or any portion thereof pursuant to judgment or decree of a court
or courts having competent jurisdiction. The rights and remedies of the Pledgee and the Lenders
under this Agreement are cumulative and not exclusive of any rights or remedies which any of them
otherwise have.



     Section 7. Application of Proceeds of Sale and Cash. The proceeds of any sale of the
whole or any part of the Collateral upon the exercise of remedies pursuant to Section 6 of this
Agreement, together with any other moneys held by the Pledgee under the provisions of this
Agreement, shall be applied in accordance with Section 10.4. of the Credit Agreement. Each Pledgor
shall remain liable and will pay, on demand, any deficiency remaining in respect of the Secured
Obligations.



     Section 8. Pledgee Appointed Attorney-in-Fact. Each Pledgor hereby constitutes and
appoints the Pledgee as the attorney-in-fact of such Pledgor with full power of substitution either
in the Pledgee’s name or in the name of such Pledgor to do any of the following: (a) to perform any
obligation of such Pledgor hereunder in such Pledgor’s name or otherwise; (b) to ask for,



E-8









 







demand, sue for, collect, receive, receipt and give acquittance for any and all moneys due or to
become due under and by virtue of any Collateral; (c) to prepare, execute, file, record or deliver
notices, assignments, financing statements, continuation statements, applications for registration
or like papers to perfect, preserve or release the Pledgee’s security interest in the Collateral;
(d) to issue entitlement orders, instructions and other orders to any securities intermediary in
connection with any of the Collateral held by or maintained with such securities intermediary; (e)
to verify facts concerning the Collateral in such Pledgor’s name, its own name or a fictitious
name; (f) to endorse checks, drafts, orders and other instruments for the payment of money payable
to such Pledgor, representing any interest or dividend or other distribution payable in respect of
the Collateral or any part thereof or on account thereof and to give full discharge for the same;
(g) to exercise all rights, powers and remedies which such Pledgor would have, but for this
Agreement, with respect to any of the Collateral; and (h) to carry out the provisions of this
Agreement and to take any action and execute any instrument which the Pledgee may deem necessary or
advisable to accomplish the purposes hereof, and to do all acts and things and execute all
documents in the name of such Pledgor or otherwise, deemed by the Pledgee as necessary, proper and
convenient in connection with the preservation, perfection or enforcement of its rights hereunder;
provided, however, the Pledgee may only exercise its rights described in the immediately preceding
clauses (a), (b), (d) and (g) if an Event of Default exists; provided further, that the Pledgee
will give notice to the Borrower as soon as reasonably possible upon its exercise of the rights
under the immediately preceding clauses (a) through (h), except (1) any such notice regarding the
exercise of rights under the immediately preceding clauses (a), (b), (d) or (g) shall be given if
and to the extent required by Applicable Law and (2) in no event will the failure to give such
notice have any effect on the validity of the exercise of any such right or give rise to liability
on the part of the Pledgee or any Lender. Nothing herein contained shall be construed as requiring
or obligating the Pledgee or any Lender to make any commitment or to make any inquiry as to the
nature or sufficiency of any payment received by it, or to present or file any claim or notice, or
to take any action with respect to the Collateral or any part thereof or the moneys due or to
become due in respect thereof or any property covered thereby, and no action taken by the Pledgee
or omitted to be taken with respect to the Collateral or any part thereof shall give rise to any
defense, counterclaim or offset in favor of any Pledgor or to any claim or action against the
Pledgee. The power of attorney granted herein is irrevocable and coupled with an interest.



     Section 9. Pledgee’s Duty of Care. Other than the exercise of reasonable care to
ensure that safe custody of the Collateral while being held by the Pledgee hereunder, the Pledgee
shall have no duty or liability to preserve rights pertaining thereto, it being understood and
agreed that each Pledgor shall responsible for preservation of all rights of such Pledgor in the
Collateral. The Pledgee shall be deemed to have exercised reasonable care in the custody and
preservation of the Collateral in its possession if such Collateral is accorded treatment
substantially equal to that which the Pledgee accords its own property, it being understood that
the Pledgee shall not have responsibility for (a) ascertaining or taking action with respect to
calls, conversions, exchanges, maturities, tenders or other matters relating to any Collateral,
whether or not the Pledgee has or is deemed to have knowledge of such matters or (b) taking any
necessary steps to preserve rights against any parties with respect to any Collateral.



E-9









 





     Section 10. Reimbursement of Pledgee. Each Pledgor agrees to pay upon demand to the
Pledgee the amount of any and all expenses, including the reasonable fees, disbursements and other
charges of its counsel and of any experts or agents, and its fully allocated internal costs, that
the Pledgee may incur in connection with (a) the administration of this Agreement, (c) the custody
or preservation of, or any sale of, collection from, or other realization upon, any of the
Collateral, (c) the exercise or enforcement of any of the rights of the Pledgee hereunder, or (d)
the failure by any Pledgor to perform or observe any of the provisions hereof or otherwise in
respect of the Collateral.



     Section 11. Indemnification. Each Pledgor agrees to pay, indemnify, and hold the
Pledgee, each Lender and each of their respective predecessor, affiliate, subsidiaries, successors
and assigns, together with their past, present and future officers, directors, agents, attorneys,
financial advisors, representatives, partners, joint ventures, affiliates and the successor and
assigns of any and all of them (each, an “Indemnified Person”) harmless from and against any and
all other liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever (“Indemnified Amounts”) brought against
or incurred by an Indemnified Person, in any manner arising out of or, directly or indirectly,
related in any way to or connected with this Agreement, including without limitation, the exercise
by the Pledgee or any Lender of any of its rights and remedies under this Agreement or any other
action taken by the Pledgee or any Lender pursuant to the terms of this Agreement; provided,
however, a Pledgor shall have no obligation hereunder to any Indemnified Person with respect to
Indemnified Amounts to the extent arising from the gross negligence or willful misconduct of such
Indemnified Party, as determined by a court of competent jurisdiction in a final, non-appealable
judgment.



     Section 12. Further Assurances. Each Pledgor shall, at its sole cost and expense,
take all action that may be necessary or desirable in the Pledgee’s sole discretion, so as at all
times to maintain the validity, perfection, enforceability and priority of the Pledgee’s security
interest in the Collateral, or to enable the Pledgee to exercise or enforce its rights hereunder,
including without limitation or otherwise in respect of the Collateral. The Pledgee shall at all
times have the right to exchange the certificates representing such Equity Interests for
certificates of smaller or larger numbers of shares for any purpose consistent with this Agreement.



     Section 13. Securities Act. In view of the position of the Pledgors in relation to
the Collateral, or because of other current or future circumstances, a question may arise under the
Securities Act, or any similar Applicable Law hereafter enacted analogous in purpose or effect (the
Securities Act and any such similar Applicable Law as from time to time in effect being called the
“Federal Securities Laws”) with respect to any disposition of the Collateral permitted hereunder.
Each Pledgor understands that compliance with the Federal Securities Laws might very strictly limit
the course of conduct of the Pledgee if the Pledgee were to attempt to dispose of all or any part
of the Collateral in accordance with the terms hereof, and might also limit the extent to which or
the manner in which any subsequent transferee of any Collateral could dispose of the same.
Similarly, there may be other legal restrictions or limitations affecting the Pledgee in any
attempt to dispose of all or part of the Collateral in accordance with the terms hereof under
applicable Blue Sky or other state securities laws or similar Applicable Law analogous in purpose
or effect. Each Pledgor recognizes that in light of the foregoing restrictions and



E-10









 







limitations the Pledgee may, with respect to any sale of the Collateral, limit the purchasers to
those who will agree, among other things, to acquire such Collateral for their own account, for
investment, and not with a view to the distribution or resale thereof. Each Pledgor acknowledges
and agrees that in light of the foregoing restrictions and limitations, the Pledgee, in its sole
and absolute discretion, may, in accordance with Applicable Law, (a) proceed to make such a sale
whether or not a registration statement for the purpose of registering such Collateral or part
thereof shall have been filed under the Federal Securities Laws and (b) approach and negotiate with
a single potential purchaser to effect such sale. Each Pledgor acknowledges and agrees that any
such sale might result in prices and other terms less favorable to the seller than if such sale
were a public sale without such restrictions. In the event of any such sale, the Pledgee shall
incur no responsibility or liability for selling all or any part of the Collateral in accordance
with the terms hereof at a price that the Pledgee, in its sole and absolute discretion, may in good
faith deem reasonable under the circumstances, notwithstanding the possibility that a substantially
higher price might have been realized if the sale were deferred until after registration as
aforesaid or if more than a single purchaser were approached. To the extent permitted by
Applicable Law, the provisions of this Section will apply notwithstanding the existence of public
or private market upon which the quotations or sales prices may exceed substantially the price at
which the Pledgee sells.



     Section 14. Continuing Security Interest. This Agreement shall create a continuing
security interest in the Collateral and shall remain in full force and effect until it terminates
in accordance with its terms.



     Section 15. Security Interest Absolute. All rights of the Pledgee hereunder, the
grant of a security interest in the Collateral and all obligations of each Pledgor hereunder, shall
be absolute and unconditional irrespective of (a) any lack of validity or enforceability of any
Loan Document, any agreement with respect to any of the Secured Obligations or any other agreement
or instrument relating to any of the foregoing, (b) any change in the time, manner or place of the
payment of, or in any other term of, all or any of the Secured Obligations, or any other amendment
or waiver of or any consent to any departure from any Loan Document, or any other agreement or
instrument relating to any of the foregoing, (c) any exchange, release or nonperfection of any
other collateral, or any release or amendment or waiver of or consent to or departure from any
guaranty, for all or any of the Secured Obligations or (d) any other circumstance that might
otherwise constitute a defense available to, or a discharge of, any Pledgor in respect of the
Secured Obligations or in respect of this Agreement (other than the indefeasible payment in full of
all the Secured Obligations).



     Section 16. No Waiver. Neither the failure on the part of the Pledgee or any Lender
to exercise, nor the delay on the part of the Pledgee or any Lender in exercising any right, power
or remedy hereunder, nor any course of dealing between the Pledgee or any Lender, on the one hand,
and any Pledgor, on the other hand, shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right, power, or remedy hereunder preclude any other or the further
exercise thereof or the exercise of any other right, power or remedy.



     Section 17. Notices. Notices, requests and other communications required or
permitted hereunder shall be given in accordance with, and subject to the provisions of, Section
12.1. of the



E-11









 







Credit Agreement, in the case of the Borrower, and Section 25 of the Guaranty, in the case of any
other Pledgor.



     SECTION 18. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE
FULLY PERFORMED, IN SUCH STATE.



SECTION 19. LITIGATION; JURISDICTION; OTHER MATTERS; WAIVERS.




     (a) EACH PARTY HERETO ACKNOWLEDGES THAT ANY DISPUTE OR CONTROVERSY AMONG ANY OF THE PLEDGORS
AND THE PLEDGEE WOULD BE BASED ON DIFFICULT AND COMPLEX ISSUES OF LAW AND FACT AND WOULD RESULT IN
DELAY AND EXPENSE TO THE PARTIES. ACCORDINGLY, TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH OF
THE PLEDGEE AND THE PLEDGORS HEREBY WAIVES ITS RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING
OF ANY KIND OR NATURE IN ANY COURT OR TRIBUNAL IN WHICH AN ACTION MAY BE COMMENCED BY OR AGAINST
ANY PARTY HERETO ARISING OUT OF OR RELATING IN ANY WAY TO THIS AGREEMENT OR THE COLLATERAL.



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



     (c) EACH PLEDGOR EXPRESSLY WAIVES TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW: (i) ANY
CONSTITUTIONAL OR OTHER RIGHT TO A JUDICIAL HEARING PRIOR TO THE TIME THE PLEDGEE DISPOSES OF ALL
OR ANY PART OF THE COLLATERAL AS PROVIDED IN THIS AGREEMENT; (ii) ALL RIGHTS OF REDEMPTION, STAY,
OR APPRAISAL THAT SUCH PLEDGOR NOW HAS OR MAY AT ANY TIME IN THE FUTURE HAVE UNDER ANY APPLICABLE
LAW NOW EXISTING OR HEREAFTER ENACTED; AND (iii) EXCEPT AS EXPRESSLY REQUIRED



E-12









 







UNDER THIS AGREEMENT OR APPLICABLE LAW, ANY REQUIREMENT OF NOTICE, DEMAND, OR ADVERTISEMENT FOR
SALE.



     (d) THE PROVISIONS OF THIS SECTION HAVE BEEN CONSIDERED BY EACH PARTY WITH THE ADVICE OF
COUNSEL AND WITH A FULL UNDERSTANDING OF THE LEGAL CONSEQUENCES THEREOF, AND SHALL SURVIVE THE
PAYMENT OF THE SECURED OBLIGATIONS AND THE TERMINATION OF THIS AGREEMENT.



     Section 20. Amendments. No amendment or waiver of any provision of this Agreement
nor consent to any departure by any Pledgor herefrom shall in any event be effective unless the
same shall be in writing and signed by the parties hereto, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which given.



     Section 21. Binding Agreement; Assignment. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and permitted assigns,
except that no Pledgor shall be permitted to assign this Agreement or any interest herein or in the
Collateral or any part thereof and any such assignment by a Pledgor shall be null and void absent
the prior written consent of the Pledgee.



     Section 22. Termination. Upon indefeasible payment in full of all of the Secured
Obligations (other than Secured Obligations in respect of Derivatives Contracts) and termination of
the Credit Agreement in accordance with its terms, this Agreement shall terminate. Upon
termination of this Agreement in accordance with its terms, the Pledgee agrees to take such actions
as any Pledgor may reasonably request, and at the sole cost and expense of such Pledgor, to
evidence the termination of this Agreement.



     Section 23. Severability. Whenever possible, each provision of this Agreement shall
be interpreted in such a manner as to be effective and valid under Applicable Law, but if any
provision of this Agreement shall be prohibited by or invalid under Applicable Law, such provisions
shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the
remainder of such provisions or the remaining provisions of this Agreement.



     Section 24. Headings. Section headings used herein are for convenience only and are
not to affect the construction of or be taken into consideration in interpreting this Agreement.



     Section 25. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original and all of which shall constitute but one
agreement.



     Section 26. Joint and Several Obligations of Pledgors. THE OBLIGATIONS OF THE
PLEDGORS HEREUNDER SHALL BE JOINT AND SEVERAL.



[Signatures on Next Page]




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     IN WITNESS WHEREOF, each Pledgor has executed and delivered this Pledge Agreement under seal
as of this the date first written above.



	 	 	 	 	 	 	 	 	 
	 	 	PLEDGORS:  
	 
	 	 	 	 	 	 	 	 
	 	 	[NAME OF PLEDGORS]
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 	 	 





Agreed to, accepted and acknowledged

as of the date first written above.




	 	 	 	 	 	 	 
	PLEDGEE:	 	 
	 
	 	 	 	 	 	 
	WACHOVIA BANK, NATIONAL ASSOCIATION, as Agent	 	 
	 
	 	 	 	 	 	 
	By:
	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 





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ANNEX 1 TO PLEDGE AGREEMENT




FORM OF PLEDGE AGREEMENT SUPPLEMENT




     THIS PLEDGE AGREEMENT SUPPLEMENT dated as of ___, 200___(this “Supplement”) executed
and delivered by ___, a ___(the “New Pledgor”) in favor of WACHOVIA
BANK, NATIONAL ASSOCIATION, as Agent (the “Pledgee”).



     WHEREAS, pursuant to that certain Credit Agreement dated as of April 10, 2007 (as amended,
restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and
among Ashford Hospitality Limited Partnership (the “Borrower”), the financial institutions from
time to time party thereto as “Lenders”, the Pledgee, and the other parties thereto, the Lenders
have agreed to make available to the Borrower certain financial accommodations on the terms and
conditions set forth in the Credit Agreement;



     WHEREAS, to secure obligations owning by certain parties under the Credit Agreement and the
other Loan Documents, the Borrower and the other “Pledgors” thereunder have executed and delivered
that certain Pledge Agreement dated as of April 10, 2007 (as amended, restated, supplemented or
otherwise modified from time to time, the “Pledge Agreement”) in favor of the Pledgee;



     WHEREAS, it is a condition precedent to the continued extension by the Lenders and the Pledgee
of such financial accommodations that the New Pledgor execute this Supplement to become a party to
the Pledge Agreement.



     NOW, THEREFORE, in consideration of the above premises and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged by the New Pledgor, the
New Pledgor hereby agrees as follows:



     Section 1. Accession to Pledge Agreement; Grant of Security Interest. The New
Pledgor agrees that it is a “Pledgor” under the Pledge Agreement and assumes all obligations of a
“Pledgor” thereunder, all as if the New Pledgor had been an original signatory to the Pledge
Agreement. Without limiting the generality of the foregoing, the New Pledgor hereby:



     (a) pledges to the Pledgee for the benefit of the Lenders, and grants to the Pledgee for the
benefit of the Lenders a security interest in, all of the New Pledgor’s right, title and interest
in, to and under the Collateral, including the Equity Interests described on Exhibit I attached
hereto, as security for the Secured Obligations;



     (b) makes to the Pledgee and the Lenders as of the date hereof each of the representations and
warranties contained in Section 3 of the Pledge Agreement and agrees to be bound by each of the
covenants contained in the Pledge Agreement, including without limitation, those contained in
Section 4 thereof; and



E-15









 





     (c) consents and agrees to each other provision set forth in the Pledge Agreement.



     SECTION 2. GOVERNING LAW. THIS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED,
AND TO BE FULLY PERFORMED, IN SUCH STATE.



     Section 3. Definitions. Capitalized terms used herein and not otherwise defined
herein shall have their respective defined meanings given them in the Pledge Agreement.



[Signatures on Next Page]




E-16









 








     IN WITNESS WHEREOF, the New Pledgor has caused this Pledge Agreement Supplement to be duly
executed and delivered under seal by its duly authorized officers as of the date first written
above.



	 	 	 	 	 	 	 	 	 
	 

	 	[NEW PLEDGOR]	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 	 	 




Address for Notices:



                                                            



                                                            



                                                            

Attention:                     

Telecopy Number:
(        )                     

Telephone Number:
(        )                     




	 	 	 	 	 	 	 
	Accepted:	 	 
	 
	 	 	 	 	 	 
	WACHOVIA BANK, NATIONAL

       ASSOCIATION, as Agent	 	 
	 
	 	 	 	 	 	 
	By:
	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 





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EXHIBIT I




Pledged Equity Interests




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Jurisdiction of	 	 	Class of Equity	 	 	Certificate	 	 	Percentage of	 
	Pledgor	 	Issuer	 	 	Formation	 	 	Interest	 	 	Number (if any)	 	 	Ownership	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 




This Exhibit shall be deemed to be a supplement to Schedule 1 attached to the Pledge
Agreement.




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SCHEDULE 1 TO PLEDGE AGREEMENT




Pledged Equity Interests:




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Jurisdiction	 	 	Class of	 	 	Certificate	 	 	 	 
	 	 	 	 	 	 	of Formation	 	 	Equity	 	 	Number	 	 	Percentage of	 
	Pledgor	 	Issuer	 	 	of Issuer	 	 	Interest	 	 	(if any)	 	 	Ownership	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 





Pledgor Information:




	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Jurisdiction of	 	 	 	 	 	 	 
	Pledgor	 	Formation	 	 	Organizational ID No.	 	 	Location of Chief Executive Office	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 





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SCHEDULE 2 TO PLEDGE AGREEMENT




Form of Acknowledgement and Consent




     The undersigned hereby acknowledges receipt of a copy of the Pledge Agreement dated as of
April 10, 2007 (the “Pledge Agreement”), made by Ashford Hospitality Limited Partnership and the
other Pledgors party thereto in favor of Wachovia Bank, National Association, as Agent. Terms not
otherwise defined herein have the respective meanings given them in the Pledge Agreement.



     The undersigned agrees for the benefit of the Pledgee and the Lenders as follows:



     (a) The undersigned will be bound by, and comply with, the terms of the Pledge Agreement
applicable to the undersigned, including without limitation, Sections 4(e) and 4(g).



     (b) The undersigned will notify the Pledgee in writing promptly of the occurrence of any of
the events described in Section 4(d) of the Pledge Agreement.



     [(c) The undersigned will not permit any of the Equity Interests issued by it (i) to be dealt
in or traded on a securities exchange or in securities markets; or (ii) to provide by its terms
that it is a security governed by Article 8 of the UCC.] 16



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



	 	 	 	 	 	 	 	 	 
	 	 	[ISSUER]	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 	 	 







 




			
	16	 	Include only if the Issuer is a partnership or limited liability company.






E-20









 





EXHIBIT F




FORM OF SECURITY AGREEMENT




     THIS SECURITY AGREEMENT dated as of April 10, 2007 executed and delivered by each of the
undersigned parties identified as “Grantors” on the signature pages hereto and the other Persons
who may become Grantors hereunder pursuant to the execution and delivery of a Security Agreement
Supplement substantially in the form of Annex 1 hereto (each a “Grantor” and collectively, the
“Grantors”) in favor of WACHOVIA BANK, NATIONAL ASSOCIATION, as Agent (the “Secured Party”).



     WHEREAS, pursuant to that certain Credit Agreement dated as of the date hereof (as amended,
restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and
among Ashford Hospitality Limited Partnership (the “Borrower”), the financial institutions from
time to time party thereto as “Lenders” and the Secured Party, the Lenders, the Secured Party and
the other parties thereto have agreed to make available to the Borrower certain financial
accommodations on the terms and conditions contained in the Credit Agreement;



     WHEREAS, the Borrower and each of the other Grantors, though separate legal entities, are
members of the same corporate family and have determined it to be in their mutual best interests to
obtain financing from the Lenders and the Secured Party through their collective efforts;



     WHEREAS, each Grantor acknowledges that it will receive direct and indirect benefits from the
Lenders and the Secured Party making such financial accommodations available to the Borrower under
the Credit Agreement; and



     WHEREAS, it is a condition precedent to the extension of such financial accommodations under
the Credit Agreement that the Grantors execute and deliver this Agreement, among other things, to
grant to the Secured Party for the benefit of the Lenders a security interest in the Collateral as
security for the Secured Obligations.



     NOW, THEREFORE, in consideration of the mutual agreements herein contained and for other good
and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the
parties, the parties agree as follows:



     Section 1. Definitions.



     (a) The following terms shall have the following meanings:



     “Additional Pledged Collateral” means any Pledged Collateral acquired by any Grantor
after the date hereof and in which a security interest is granted pursuant to Section 2, including,
to the extent a security interest is granted therein pursuant to such Section, (i) all additional
Indebtedness from time to time owed to any Grantor by any obligor on the Pledged Debt



F-1









 







Instruments and the Instruments evidencing such Indebtedness and (ii) all interest, cash,
Instruments and other property or Proceeds from time to time received, receivable or otherwise
distributed in respect of or in exchange for any of the foregoing.



     “Agreement” means this Security Agreement.



     “Bankruptcy Code” means United States Bankruptcy Code (11 U.S.C. Section 101 et seq.),
as in effect from time to time, and any successor statute thereto.



     “Credit Agreement” has the meaning given that term in the recitals of this Agreement.



     “Collateral” means, with respect to a Grantor, all of such Grantor’s right, title and
interest to and under all of the following property, whether now owned or hereafter acquired by
such Grantor or in which a Grantor now has or at any time in the future may acquire any right,
title or interest, and whether now existing or hereafter arising:




     (a) all Deposit Accounts;




     (b) all Instruments;




     (c) all Securities Accounts;




     (d) all books and records pertaining to any property described in this definition;




     (e) all Supporting Obligations pertaining to any property described in this definition;




     (f) all property of the types described in clauses (a) through (e) of this definition
of any Grantor held by the Secured Party, including all such property, in the possession or
custody of or in transit to the Secured Party for any purpose, including safekeeping,
collection or pledge, for the account of such Grantor or as to which such Grantor may have
any right or power; and




     (g) to the extent not otherwise included, all Proceeds.


When the term “Collateral” is used without reference to a Grantor, then it shall be deemed to be a
collective reference to the “Collateral” of all Grantors.




     “Deposit Account” means a deposit account of a Grantor in which such Grantor maintains
any reserves for furniture, Fixtures and/or Equipment.



     “Deposit Account Control Agreement” means an agreement, in form and substance
satisfactory to the Secured Party, entered into by a Grantor, the Secured Party and the bank at
which such Grantor maintains a Deposit Account giving the Secured Party control over such Deposit
Account.



F-2









 





     “Permitted Liens” means, as to any Person: (i) Liens securing taxes, assessments and
other charges or levies imposed by any governmental authority (excluding any Lien imposed pursuant
to any of the provisions of ERISA or pursuant to any environmental laws) or the claims of
materialmen, mechanics, carriers, warehousemen or landlords for labor, materials, supplies or
rentals incurred in the ordinary course of business, which are not at the time required to be paid
or discharged under the applicable provisions of the Loan Documents; (ii) Liens consisting of
deposits or pledges made, in the ordinary course of business, in connection with, or to secure
payment of, obligations under workers’ compensation, unemployment insurance or similar laws; and
(iii) Liens in favor of the Secured Party for the benefit of the Lenders.



     “Pledged Collateral” means, collectively, Pledged Debt Instruments, any other
Investment Property of any Grantor, all chattel paper, certificates or other Instruments
representing any of the foregoing and all Security Entitlements of any Grantor in respect of any of
the foregoing. Pledged Collateral may be General Intangibles, Instruments or Investment Property.
Pledged Collateral shall not include any property that constitutes “Collateral” under and as
defined in the Pledge Agreement.



     “Pledged Debt Instruments” means all right, title and interest of any Grantor in
Instruments evidencing any Indebtedness owed to such Grantor, including all Indebtedness described
on Schedule 1, issued by the obligors named therein.



     “Proceeds” means all proceeds (including proceeds of proceeds) of any of the
Collateral including all: (i) rights, benefits, distributions, premiums, profits, dividends,
interest, cash, Instruments, Documents, Accounts, contract rights, Inventory, Equipment, General
Intangibles, Payment Intangibles, Deposit Accounts, Chattel Paper, and other property from time to
time received, receivable, or otherwise distributed in respect of or in exchange for, or as a
replacement of or a substitution for, any of the Collateral, or proceeds thereof; (ii) “proceeds,”
as such term is defined in Section 9-102(a)(64) of the UCC; (iii) proceeds of any insurance,
indemnity, warranty, or guaranty (including guaranties of delivery) payable from time to time with
respect to any of the Collateral, or proceeds thereof; and (iv) payments (in any form whatsoever)
made or due and payable to a Grantor from time to time in connection with any requisition,
confiscation, condemnation, seizure or forfeiture of all or any part of the Collateral, or proceeds
thereof.



     “Secured Obligations” means, collectively, (a) with respect to the Borrower, the
unpaid principal of and interest on all Loans, all Reimbursement Obligations, all other Letter of
Credit Liabilities and all other indebtedness, liabilities, obligations, covenants and duties of
the Borrower owing to the Secured Party or any Lender (or, in the case of any Derivatives Contract,
any Affiliate of any Lender) of any kind, nature or description, under or in respect of the Credit
Agreement, any other Loan Document to which the Borrower is a party or any Derivatives Contract
entered into by the Borrower with any Person that is or was a Lender (or any Affiliate of any
Lender) at the time such Derivatives Contract was executed, whether direct or indirect, absolute or
contingent, due or to become due, contractual or tortious, liquidated or unliquidated, and
including all interest (including interest that accrues after the filing of a case under the
Bankruptcy Code) and any and all costs, fees (including reasonable attorneys fees), and expenses



F-3









 







which the Borrower is required to pay pursuant to any of the foregoing, under Applicable Law, or
otherwise and (b) with respect to any other Grantor, all indebtedness, liabilities, obligations,
covenants and duties of such Grantor owing to the Secured Party or any Lender (or, in the case of
any Derivatives Contract, any Affiliate of any Lender) of any kind, nature or description, under or
in respect of the Guaranty, any other Loan Document to which such Grantor is a party or any
Derivatives Contract entered into by such Grantor with any Person that is or was a Lender (or any
Affiliate of any Lender) at the time such Derivatives Contract was executed, whether direct or
indirect, absolute or contingent, due or to become due, contractual or tortious, liquidated or
unliquidated, and including all interest (including interest that accrues after the filing of a
case under the Bankruptcy Code) and any and all costs, fees (including reasonable attorneys fees),
and expenses which such Grantor is required to pay or has guaranteed pursuant to any of the
foregoing, under Applicable Law, or otherwise.



     “Securities Account” means a securities account of a Grantor in which such Grantor
maintains any reserves for furniture, Fixtures and/or Equipment.



     “Securities Account Control Agreement” means an agreement, in form and substance
satisfactory to the Secured Party, entered into by a Grantor, the Secured Party and the Securities
Intermediary at which such Grantor maintains a Securities Account giving the Secured Party control
over such Securities Account.



     “UCC” means the Uniform Commercial Code as from time to time in effect in the State of
New York; provided, however, to the extent that, by reason of mandatory provisions of law, any of
the attachment, perfection, or priority of, or remedies with respect to, the Secured Party’s
security interest in any Collateral is governed by the Uniform Commercial Code as in effect in a
jurisdiction other than the State of New York, the term “UCC” shall mean the Uniform Commercial
Code as in effect in such other jurisdiction solely for purposes of the provisions hereof relating
to such attachment, perfection, priority or remedies and for purposes of definitions related to
such provisions.



     (b) Unless otherwise defined herein, terms defined in the Credit Agreement and used herein
have the respective meanings given them in the Credit Agreement.



     (c) Terms used herein without definition that are defined in the UCC have the respective
meanings given them in the UCC and if defined in more than one article of the UCC, such terms shall
have the meaning defined in Article 9 of the UCC, including the following terms (which are
capitalized herein):


“Account”

“Certificated Security”

“Chattel Paper”

“Documents”

“Entitlement Holder”

“Entitlement Order”

“Equipment”

“Financial Asset”




F-4









 







“Fixtures”

“General Intangible”

“Goods”

“Instruments”

“Inventory”

“Investment Property”

“Securities Intermediary”

“Security”

“Security Entitlement”

“Supporting Obligation”

“Uncertificated Security”

“Payment Intangible”




     (d) In this Agreement, in the computation of periods of time from a specified date to a later
specified date, the word “from” means “from and including” and the words “to” and “until” each mean
“to but excluding” and the word “through” means “to and including.” The terms “herein,” “hereof,”
“hereto” and “hereunder” and similar terms refer to this Agreement as a whole and not to any
particular Article, Section, subsection or clause in this Agreement. Unless otherwise noted,
references herein to an Annex, Schedule, Section, subsection or clause refer to the appropriate
Annex or Schedule to, or Section, subsection or clause of this Agreement. The meanings given to
terms defined herein shall be equally applicable to both the singular and plural forms of such
terms. Where the context requires, provisions relating to any Collateral, when used in relation to
a Grantor, shall refer to such Grantor’s Collateral or any relevant part thereof. Any reference in
this Agreement to a Loan Document shall include all appendices, exhibits and schedules thereto,
and, unless specifically stated otherwise all amendments, restatements, supplements or other
modifications thereto, and as the same may be in effect at any time such reference becomes
operative. The term “including” means “including without limitation” except when used in the
computation of time periods. The terms “Lender,” and “Secured Party” include their respective
successors and permitted assigns.



     Section 2. Grant of Security Interests in Collateral. Each Grantor, as security for
the full, prompt and complete payment and performance when due (whether at stated maturity, by
acceleration or otherwise) of the Secured Obligations, hereby mortgages, pledges and hypothecates
to the Secured Party for the benefit of the Lenders, and grants to the Secured Party for the
benefit of the Lenders a lien on and security interest in, all of such Grantor’s right, title and
interest in, to and under the Collateral of such Grantor.



     Section 3. Grantors Remain Obligated. Notwithstanding any other provision of this
Agreement to the contrary, (a) each Grantor shall remain liable to observe and perform all the
conditions and obligations to be observed and performed by it under each and every contract or
other agreement included as part of the Collateral, all in accordance with the terms of each such
contract and agreement, (b) neither the Secured Party nor any Lender shall have any obligation or
liability under any contract or other agreement included as part of the Collateral by reason of or
arising out of this Agreement or the receipt by the Secured Party or any Lender of any payment
relating thereto, (c) the exercise by the Secured Party of any rights under this Agreement or
otherwise in respect of the Collateral shall not release any Grantor from its



F-5









 







obligations under any contract or other agreement included as part of the Collateral and (d)
neither the Secured Party nor any Lender shall be obligated to take any of the following actions
with respect to any contract or other agreement included as part of the Collateral: (i) perform any
obligation of any Grantor, (ii) make any payment, (iii) make any inquiry as to the nature or the
sufficiency of any payment received by it or as to the sufficiency of any performance by any party,
(iv) present or file any claim or (v) take any action to enforce any performance or to collect the
payment of any amounts that may have been assigned to it or to which it may be entitled at any time
or times.



     Section 4. Representations and Warranties. Each Grantor represents and warrants to
the Secured Party and the Lenders as follows:



     (a) Title and Liens. Such Grantor is, and will at all times continue to be, the legal
and beneficial owner of the Collateral of such Grantor except for Collateral disposed of by such
Grantor as expressly permitted by any Loan Document. Not in limitation of the preceding sentence,
such Grantor is the Entitlement Holder of all Investment Property held in a Securities Account of
such Grantor. None of the Collateral is subject to any adverse claim or other Lien other than
Permitted Liens.



     (b) Authorization. Such Grantor has the right and power, and has taken all necessary
action to authorize it, to execute, deliver and perform this Agreement in accordance with its
terms. The execution, delivery and performance of this Agreement in accordance with its terms,
including the granting of the security interest hereunder, do not and will not, by the passage of
time, the giving of notice, or both: (i) require any Government Approval or violate any Applicable
Law (including any Environmental Law) relating to such Grantor; (ii) require and consent or
approval of, or authorization, order or other action by, any Governmental Authority or other
Person, (iii) conflict with, result in a breach of or constitute a default under the organizational
documents of such Grantor, or any indenture, agreement or other instrument to which such Grantor is
a party or by which it or any of the Collateral of such Grantor or its other property may be bound;
or (iv) result in or require the creation or imposition of any Lien upon or with respect to any of
the Collateral of such Grantor or such Grantor’s other property whether now owned or hereafter
acquired.



     (c) Validity and Perfection of Security Interest. This Agreement is effective to
create in favor of the Secured Party, for the benefit of the Lenders, a legal, valid and
enforceable security interest in the Collateral. Such security interest will be perfected upon (i)
in the case of all Collateral in which a security interest may be perfected by the filing of a
financing statement under the UCC, the completion of the filings and other actions specified on
Schedule 2 (which, in the case of all filings and other documents referred to on such Schedule,
have been delivered to the Secured Party in completed and duly executed form), (ii) the delivery to
the Secured Party of all Collateral consisting of Instruments and Certificated Securities, in each
case properly endorsed for transfer to the Secured Party or in blank, (iii) the execution of
Securities Account Control Agreements with respect to Investment Property not in certificated form,
and (iv) the execution of Deposit Account Control Agreements with respect to all Deposit Accounts
of a Grantor. Except as set forth in this subsection, no action is necessary to perfect the
security interest granted by any Grantor under this Agreement. Each such security interest shall
be prior



F-6









 







to all other Liens on the Collateral except for Permitted Liens having priority over the Secured
Party’s security interest solely by operation of Applicable Law.



     (d) Jurisdiction of Formation, Locations, Etc. Such Grantor’s jurisdiction of
organization, exact legal name, organizational identification number, if any, and the location of
such Grantor’s chief executive office or sole place of business, in each case as of the date
hereof, is specified on Schedule 3 and such Schedule also lists all jurisdictions of incorporation,
legal names and locations of such Grantor’s chief executive office or sole place of business for
the five years preceding the date hereof.



     (e) Pledged Collateral. All Pledged Collateral and, if applicable, any Additional
Pledged Collateral, consisting of Certificated Securities or Instruments has been delivered to the
Secured Party in accordance with Section 5(f) or (g).



     (f) Deposit Accounts and Securities Accounts. Schedule 4 sets forth all Deposit
Accounts and Securities Accounts maintained by any Grantor on the date hereof or on the date of the
delivery of any update to such Schedule pursuant to the terms hereof, which sets forth such
information separately for each Grantor.



     Section 5. Covenants. Each Grantor hereby unconditionally covenants and agrees as
follows:



     (a) No Liens, Sale, Etc. Such Grantor shall (i) except for the security interests
created by this Agreement, not create or suffer to exist any Lien upon or with respect to any
Collateral, except Permitted Liens, (ii) not sell, transfer or assign (by operation of law or
otherwise) any Collateral except as expressly permitted under the Loan Documents, and (iii) not
enter into any agreement or undertaking restricting the right or ability of such Grantor or the
Secured Party to sell, assign or transfer, or grant any Lien in, any Collateral except as expressly
permitted under the Loan Documents.



     (b) Maintenance of Perfection. Such Grantor shall maintain the security interests
created by this Agreement as perfected security interests having at least the priority described in
Section 4(c) and shall defend such security interests and the applicable priorities of such
security interests against the claims and demands of all Persons.



     (c) Statements of Collateral. Such Grantor shall furnish to the Secured Party from
time to time statements and schedules further identifying and describing the Collateral and such
other reports in connection with the Collateral as the Secured Party may reasonably request, all in
reasonable detail and in form and substance reasonably satisfactory to the Secured Party.



     (d) Changes in Locations, Name, Etc. Unless a Grantor shall have given the Secured
Party at least 30 days’ prior written notice (or such shorter time as shall be acceptable to the
Secured Party) and shall have delivered to the Secured Party all additional financing statements
and other documents reasonably requested by the Secured Party to maintain the validity, perfection
and priority of the security interests provided for herein, such Grantor shall not do any of the
following:



F-7









 






     (i) change its jurisdiction of organization or its location, in each case from that
referred to in Section 4(d); or




     (ii) change its legal name or organizational identification number, if any, or
corporation, limited liability company or other organizational structure to such an extent
that any financing statement filed in connection with this Agreement would become
misleading.



     (e) Control Agreements. Each Grantor shall obtain and deliver to the Secured Party an
authenticated Deposit Account Control Agreement, from each bank holding a Deposit Account (other
than any Deposit Account having an individual average balance during any 30-day period of less than
$100,000) for such Grantor. Each Grantor shall obtain an authenticated Securities Account Control
Agreement from each Securities Intermediary issuing or holding any Securities Account (other than
any Securities Account having an individual average balance during any 30-day period of less than
$100,000) to or for any Grantor.



     (f) Pledged Collateral. Such Grantor shall deliver to the Secured Party, all
certificates and Instruments representing or evidencing any Pledged Collateral (including
Additional Pledged Collateral), whether now existing or hereafter acquired, in suitable form for
transfer by delivery or, as applicable, accompanied by such Grantor’s endorsement, where necessary,
or duly executed instruments of transfer or assignment in blank, all in form and substance
reasonably satisfactory to the Secured Party. While an Event of Default exists, the Secured Party
shall have the right, at any time in its discretion and without notice to any Grantor, (i) to
transfer to or to register in its name or in the name of its nominees any Pledged Collateral and
(ii) to exchange any certificate or instrument representing or evidencing any Pledged Collateral
for certificates or instruments of smaller or larger denominations. Except as permitted by the
Credit Agreement, such Grantor shall not grant control over any Investment Property that is
Collateral to any Person other than the Secured Party.



     (g) Delivery of Instruments. Each Grantor shall promptly deliver to the Secured Party
each Instrument payable to such Grantor, duly indorsed in a manner reasonably satisfactory to the
Secured Party.



     (h) Further Assurances. At any time and from time to time, at the request of the
Secured Party, and at the sole expense of such Grantor, such Grantor shall promptly and duly
execute and deliver, and have recorded, such further instruments and documents and take such
further action as the Secured Party may reasonably request for the purpose of obtaining or
preserving the full benefits of this Agreement and of the rights and powers herein granted,
including the filing of any financing or continuation statement under the UCC (or other similar
laws) in effect in any jurisdiction with respect to the security interests created hereby and the
execution and delivery of Securities Account Control Agreements and Deposit Account Control
Agreements.



     Section 6. Remedial Provisions.



F-8









 





     (a) General Remedies. While an Event of Default exists, the Secured Party may
exercise, in addition to all other rights and remedies granted to it in this Agreement and in any
other instrument or agreement securing, evidencing or relating to the Secured Obligations, all
rights and remedies of a secured party under the UCC or any other Applicable Law. Without limiting
the generality of the foregoing, the Secured Party, without demand of performance or other demand,
presentment, protest, advertisement or notice of any kind (except any notice required by Applicable
Law referred to below) to or upon any Grantor or any other Person (all and each of which demands,
defenses, advertisements and notices are hereby waived by each Grantor), may in such circumstances
forthwith collect, receive, appropriate and realize upon any Collateral, and may forthwith sell,
lease, assign, give option or options to purchase, or otherwise dispose of and deliver any
Collateral (or contract to do any of the foregoing), in one or more parcels at public or private
sale or sales, at any exchange, broker’s board or office of the Secured Party or any Lender or
elsewhere upon such terms and conditions as it may deem advisable and at such prices as it may deem
best, for cash or on credit or for future delivery without assumption of any credit risk. The
Secured Party shall have the right upon any such public sale or sales, and, to the extent permitted
by the UCC and other Applicable Law, upon any such private sale or sales, to purchase the whole or
any part of the Collateral so sold, free of any right or equity of redemption of any Grantor, which
right or equity is hereby waived and released by each Grantor. To the extent permitted by
Applicable Law, each Grantor waives all claims, damages and demands it may acquire against the
Secured Party or any Lender arising out of the exercise by the Secured Party of any rights
hereunder. If any notice of a proposed sale or other disposition of Collateral shall be required
by Applicable Law, such notice shall be deemed reasonable and proper if given at least 10 days
before such sale or other disposition.



     (b) Pledged Collateral. While an Event of Default exists, upon notice by the Secured
Party to the relevant Grantor or Grantors, (i) the Secured Party shall have the right to receive
any Proceeds of the Pledged Collateral and make application thereof to the Secured Obligations in
the order provided in Section 10.4. of the Credit Agreement and (ii) the Secured Party or its
nominee may exercise any voting, consent, corporate and other right pertaining to the Pledged
Collateral as if the Secured Party were the absolute owner thereof, all without liability except to
account for property actually received by it; provided, however, that the Secured Party shall have
no duty to any Grantor to exercise any such right, privilege or option and shall not be responsible
for any failure to do so or delay in so doing. In order to permit the Secured Party to exercise
the voting and other consensual rights that it is entitled to exercise pursuant hereto and to
receive all distributions that it is entitled to receive hereunder, (i) each Grantor shall promptly
execute and deliver (or cause to be executed and delivered) to the Secured Party all such orders
and instruments as the Secured Party may from time to time request and (ii) without limiting the
immediately preceding clause (i), such Grantor hereby grants to the Secured Party an irrevocable
proxy to exercise all rights, powers, privileges and remedies to which a holder of the Pledged
Collateral would be entitled, which proxy shall be effective, automatically and without the
necessity of any action (including any transfer of any Pledged Collateral on the record books of
the issuer thereof) by any other Person (including the issuer of such Pledged Collateral or any
officer or agent thereof) while an Event of Default exists. Each Grantor hereby expressly
authorizes and irrevocably instructs each issuer of any Pledged Collateral pledged hereunder by
such Grantor to (x) comply with any instruction received by it from the Secured Party in writing
that states that an Event of Default exists and is otherwise in accordance with the terms of this



F-9









 







Agreement, without any other or further instructions from such Grantor, and each Grantor agrees
that such issuer shall be fully protected in so complying and (y) pay any payment with respect to
the Pledged Collateral directly to the Secured Party.



     (c) Writ of Possession; Receiver. Each Grantor hereby acknowledges that the Secured
Obligations arose out of a commercial transaction, and agrees that while an Event of Default exists
the Secured Party shall have the right to an immediate writ of possession with respect to the
Collateral without notice of a hearing or the requirement of posting a bond. The Secured Party
shall have the right to the appointment of a receiver for the properties and assets of each
Grantor, and each Grantor hereby consents to such rights and such appointment and hereby waives any
objection such Grantor may have thereto or the right to have a bond or other security posted by the
Secured Party.



     (d) Remedies Cumulative. Each right, power, and remedy of the Secured Party as
provided for in this Agreement or in the other Loan Documents or now or hereafter existing at law
or in equity or by statute or otherwise shall be cumulative and concurrent and shall be in addition
to every other right, power, or remedy provided for in this Agreement or in the other Loan
Documents or now or hereafter existing at law or in equity or by statute or otherwise, and the
exercise or beginning of the exercise by the Secured Party, of any one or more of such rights,
powers, or remedies shall not preclude the simultaneous or later exercise by the Secured Party of
any or all such other rights, powers, or remedies.



     (e) Marshaling. The Secured Party shall not be required to marshal any present or
future collateral security (including but not limited to the Collateral) for, or other assurances
of payment of, the Secured Obligations or any of them or to resort to such collateral security or
other assurances of payment in any particular order. To the fullest extent that it lawfully may,
each Grantor hereby agrees that it will not invoke any Applicable Law relating to the marshaling of
collateral which might cause delay in or impede the enforcement of the Secured Party’s rights and
remedies under this Agreement or under any other instrument creating or evidencing any of the
Secured Obligations or under which any of the Secured Obligations is outstanding or by which any of
the Secured Obligations is secured or payment thereof is otherwise assured, and, to the fullest
extent that it lawfully may, each Grantor hereby irrevocably waives the benefits of all such laws.



     (f) Application of Proceeds. The proceeds of any sale of the whole or any part of the
Collateral pursuant to this Agreement, together with any other moneys held by the Secured Party
under the provisions of this Agreement, shall be applied in accordance with Section 10.4. of the
Credit Agreement. Each Grantor shall remain liable and will pay, on demand, any deficiency
remaining in respect of the Secured Obligations.



     (g) Deposit Accounts and Securities Accounts. If any Event of Default shall exist,
the Secured Party may (i) instruct the bank at which any Deposit Account is maintained to comply
with instructions originated by the Secured Party directing disposition of the funds in such
Deposit Account without further consent of any Grantor and (ii) instruct the Securities
Intermediary at which any Securities Account is maintained to comply with the Entitlement Order
originated by the Secured Party without further consent of any Grantor.



F-10









 





     Section 7. Secured Party Appointed Attorney-in-Fact. Each Grantor hereby constitutes
and appoints the Secured Party as the attorney-in-fact of such Grantor with full power of
substitution either in the Secured Party’s name or in the name of such Grantor to do any of the
following: (a) to perform any obligation of such Grantor hereunder in such Grantor’s name or
otherwise; (b) to ask for, demand, sue for, collect, receive, receipt and give acquittance for any
and all moneys due or to become due under and by virtue of any Collateral; (c) to prepare, execute,
file, record or deliver notices, assignments, financing statements, continuation statements,
applications for registration or like papers to perfect, preserve or release the Secured Party’s
security interest in the Collateral; (d) to issue Entitlement Orders, instructions and other orders
to any bank or Securities Intermediary in connection with any of the Collateral held by or
maintained with such bank or Securities Intermediary; (e) to verify facts concerning the Collateral
in such Grantor’s name, its own name or a fictitious name; (f) to endorse checks, drafts, orders
and other instruments for the payment of money payable to such Grantor, representing any payment in
respect of the Collateral or any part thereof or on account thereof and to give full discharge for
the same; (g) to exercise all rights, powers and remedies which such Grantor would have, but for
this Agreement, with respect to any of the Collateral; and (h) to carry out the provisions of this
Agreement and to take any action and execute any instrument which the Secured Party may deem
necessary or advisable to accomplish the purposes hereof, and to do all acts and things and execute
all documents in the name of such Grantor or otherwise, deemed by the Secured Party as necessary,
proper and convenient in connection with the preservation, perfection or enforcement of its rights
hereunder; provided, however, the Secured Party may only exercise its rights described in the
immediately preceding clauses (a), (b), (d) and (g) if an Event of Default exists; provided,
further, that the Secured Party will give notice to the Borrower as soon as reasonably possible
upon its exercise of its rights under the immediately preceding clauses (a) through (h), except (1)
any such notice regarding the exercise of rights under the immediately preceding clauses (a), (b),
(d) or (g) shall be given if and to the extent required by Applicable Law and (2) in no event will
the failure to give such have any effect on the validity of the exercise of any such right or give
rise to liability on the part of the Secured Party or any Lender. Nothing herein contained shall
be construed as requiring or obligating the Secured Party or any Lender to make any commitment or
to make any inquiry as to the nature or sufficiency of any payment received by it, or to present or
file any claim or notice, or to take any action with respect to the Collateral or any part thereof
or the moneys due or to become due in respect thereof or any property covered thereby, and no
action taken by the Secured Party or omitted to be taken with respect to the Collateral or any part
thereof shall give rise to any defense, counterclaim or offset in favor of any Grantor or to any
claim or action against the Secured Party. The power of attorney granted herein is irrevocable and
coupled with an interest.



     Section 8. Secured Party Duties. The powers conferred on the Secured Party hereunder
are solely to protect the Secured Party’s interest in the Collateral, for the benefit of the
Lenders, and shall not impose any duty upon the Secured Party to exercise any such powers. Except
for the safe custody of any Collateral in its actual possession and the accounting for moneys
actually received by it hereunder, the Secured Party shall have no duty as to any Collateral or as
to the taking of any necessary steps to preserve rights against prior parties or any other rights
pertaining to any Collateral. The Secured Party shall be deemed to have exercise reasonable care
in the custody and preservation of any Collateral in its actual possession if the Secured Party
accords



F-11









 







such Collateral treatment substantially equal to that which the Secured Party accords its own
property.



     Section 9. Authorization of Financing Statements. Each Grantor authorizes the
Secured Party, and its counsel and other representatives, at any time and from time to time, to
file or record financing statements, amendments to financing statements, and other filing or
recording documents or instruments with respect to the Collateral in such form and in such offices
as the Secured Party reasonably determines appropriate to perfect the security interests of the
Secured Party under this Agreement. Each Grantor hereby also authorizes the Secured Party, and its
counsel and other representatives, at any time and from time to time, to file continuation
statements with respect to previously filed financing statements. A photographic or other
reproduction of this Agreement shall be sufficient as a financing statement or other filing or
recording document or instrument for filing or recording in any jurisdiction. Each Grantor
acknowledges that it is not authorized to file any financing statement or amendment or termination
statement with respect to any financing statement filed in connection with this Agreement without
the prior written consent of the Secured Party, subject to such Grantor’s rights under Section
9-509(d)(2) of the UCC.



     Section 10. Amendments. No amendment or waiver of any provision of this Agreement
nor consent to any departure by any Grantor herefrom shall in any event be effective unless the
same shall be in writing and signed by the parties hereto, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which given; provided,
however, that Schedules to this Agreement may be supplemented through Security Agreement
Supplements executed by a Grantor and accepted by the Secured Party.



     Section 11. Notices. Notices, requests and other communications required or
permitted hereunder shall be given in accordance with, and be subject to, the applicable terms of
the Credit Agreement in the case of the Borrower or the Guaranty in the case of any other Grantor.



     Section 12. No Waiver. Neither the failure on the part of the Secured Party or any
Lender to exercise, nor the delay on the part of the Secured Party or any Lender in exercising any
right, power or remedy hereunder, nor any course of dealing between the Secured Party or any
Lender, on the one hand, and any Grantor, on the other hand, shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right, power, or remedy hereunder preclude any
other or the further exercise thereof or the exercise of any other right, power or remedy.



     Section 13. Binding Agreement; Assignment. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and permitted assigns,
except that no Grantor shall be permitted to assign this Agreement or any interest herein or in the
Collateral or any part thereof and any such assignment by a Grantor shall be null and void absent
the prior written consent of the Secured Party.



     Section 14. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original and all of which shall constitute but one
agreement.



F-12









 





     Section 15. Severability. Whenever possible, each provision of this Agreement shall
be interpreted in such a manner as to be effective and valid under applicable law, but if any
provision of this Agreement shall be prohibited by or invalid under applicable law, such provisions
shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the
remainder of such provisions or the remaining provisions of this Agreement.



     Section 16. Headings. Section headings used herein are for convenience only and are
not to affect the construction of or be taken into consideration in interpreting this Agreement.



     SECTION 17. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE
FULLY PERFORMED, IN SUCH STATE.



     SECTION 18. LITIGATION; JURISDICTION; OTHER MATTERS; WAIVERS.



     (a) EACH PARTY HERETO ACKNOWLEDGES THAT ANY DISPUTE OR CONTROVERSY AMONG ANY OF THE GRANTORS
AND THE SECURED PARTY WOULD BE BASED ON DIFFICULT AND COMPLEX ISSUES OF LAW AND FACT AND WOULD
RESULT IN DELAY AND EXPENSE TO THE PARTIES. ACCORDINGLY, TO THE EXTENT PERMITTED BY APPLICABLE
LAW, EACH OF THE SECURED PARTY AND THE GRANTORS HEREBY WAIVES ITS RIGHT TO A TRIAL BY JURY IN ANY
ACTION OR PROCEEDING OF ANY KIND OR NATURE IN ANY COURT OR TRIBUNAL IN WHICH AN ACTION MAY BE
COMMENCED BY OR AGAINST ANY PARTY HERETO ARISING OUT OF OR RELATING IN ANY WAY TO THIS AGREEMENT OR
THE COLLATERAL.



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



F-13









 





     (c) EACH GRANTOR EXPRESSLY WAIVES TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW: (i) ANY
CONSTITUTIONAL OR OTHER RIGHT TO A JUDICIAL HEARING PRIOR TO THE TIME THE SECURED PARTY DISPOSES OF
ALL OR ANY PART OF THE COLLATERAL AS PROVIDED IN THIS AGREEMENT; (ii) ALL RIGHTS OF REDEMPTION,
STAY, OR APPRAISAL THAT SUCH GRANTOR NOW HAS OR MAY AT ANY TIME IN THE FUTURE HAVE UNDER ANY
APPLICABLE LAW NOW EXISTING OR HEREAFTER ENACTED; AND (iii) EXCEPT AS EXPRESSLY REQUIRED UNDER THIS
AGREEMENT OR APPLICABLE LAW, ANY REQUIREMENT OF NOTICE, DEMAND, OR ADVERTISEMENT FOR SALE.



     (d) THE PROVISIONS OF THIS SECTION HAVE BEEN CONSIDERED BY EACH PARTY WITH THE ADVICE OF
COUNSEL AND WITH A FULL UNDERSTANDING OF THE LEGAL CONSEQUENCES THEREOF, AND SHALL SURVIVE THE
PAYMENT OF THE SECURED OBLIGATIONS AND THE TERMINATION OF THIS AGREEMENT.



     Section 19. Additional Grantors. If, pursuant to Section 7.12. of the Credit
Agreement, the Borrower shall be required to cause any Subsidiary that is not a Grantor to become a
Grantor hereunder, such Subsidiary shall execute and deliver to the Secured Party a Security
Agreement Supplement substantially in the form of Annex 1 hereto and shall thereafter for all
purposes be party hereto as a “Grantor” and have the same rights, benefits and obligations as a
Grantor initially party hereto.



     Section 20. Termination. Upon indefeasible payment in full of all of the Secured
Obligations (other than Secured Obligations in respect of Derivatives Contracts) and termination of
the Credit Agreement in accordance with its terms, this Agreement shall terminate. Upon
termination of this Agreement in accordance with its terms, the Secured Party agrees to take such
actions as any Grantor may reasonably request, and at the sole cost and expense of such Grantor, to
evidence the termination of this Agreement.



     Section 21. Continuing Security Interest. This Agreement shall create a continuing
security interest in the Collateral and shall remain in full force and effect until it terminates
in accordance with its terms.



     Section 22. Reinstatement. Each Grantor further that, if any payment made by any
Loan Party or other Person and applied to the Secured Obligations is at any time annulled, avoided,
set aside, rescinded, invalidated, declared to be fraudulent or preferential or otherwise required
to be refunded or repaid, or the proceeds of Collateral are required to be returned by the Secured
Party to such Loan Party, its estate, trustee, receiver or any other party, including any Grantor,
under any bankruptcy law or other applicable law, then, to the extent of such payment or repayment,
any Lien or other Collateral securing such liability shall be and remain in full force and effect,
as fully as if such payment had never been made or, if prior thereto the Lien granted hereby or
other Collateral securing such liability hereunder shall have been released or terminated by virtue
of such cancellation or surrender, such Lien or other Collateral shall be reinstated in full force
and effect, and such prior cancellation or surrender shall not diminish, release, discharge, impair
or



F-14









 







otherwise affect any Lien or other Collateral securing the obligations of any Grantor in respect of
the amount of such payment.



     Section 23. Security Interest Absolute. All rights of the Secured Party hereunder,
the grant of a security interest in the Collateral and all obligations of each Grantor hereunder,
shall be absolute and unconditional irrespective of (a) any lack of validity or enforceability of
any Loan Document, any agreement with respect to any of the Secured Obligations or any other
agreement or instrument relating to any of the foregoing, (b) any change in the time, manner or
place of the payment of, or in any other term of, all or any of the Secured Obligations, or any
other amendment or waiver of or any consent to any departure from any Loan Document, or any other
agreement or instrument relating to any of the foregoing, (c) any exchange, release or
nonperfection of any other collateral, or any release or amendment or waiver of or consent to or
departure from any guaranty, for all or any of the Secured Obligations or (d) any other
circumstance that might otherwise constitute a defense available to, or a discharge of, any Grantor
in respect of the Secured Obligations or in respect of this Agreement (other than the indefeasible
payment in full of all the Secured Obligations).



     Section 24. Joint and Several Obligations of Grantors. THE OBLIGATIONS OF THE
GRANTORS HEREUNDER SHALL BE JOINT AND SEVERAL.



[Signatures on Next Page]




F-15









 








     IN WITNESS WHEREOF, each Grantor has executed and delivered this Security Agreement under seal
as of this the date first written above.



	 	 	 	 	 	 	 	 	 
	 	 	GRANTORS:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	[NAME OF GRANTORS]	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	Title:
	 	 

	 	 
	 

	 	 	 	 	 	 

	 	 






Agreed to, accepted and acknowledged

as of the date first written above.




SECURED PARTY:




WACHOVIA BANK, NATIONAL ASSOCIATION, as Agent




	 	 	 	 	 	 	 
	By:
	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:
	 	 

	 	 
	 

	 	 	 	 

	 	 






F-16









 





SCHEDULE 1 TO SECURITY AGREEMENT




Pledged Debt Instruments




[TO BE COMPLETED BY GRANTORS]




F-17









 





SCHEDULE 2 TO SECURITY AGREEMENT




Necessary Filings



UCC Financing Statement Filings:




	 	 	 	 	 
	Grantor	 	Jurisdiction Where to be Filed	 
	 
	 	 	 	 





[TO BE COMPLETED BY GRANTORS]




F-18









 








SCHEDULE 3 TO SECURITY AGREEMENT




Jurisdictions of Organization, Names, Organizational ID Numbers, Locations, Etc.




	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Jurisdiction of	 	 	 	 	 	 	Chief Executive Office/Sole Place of	 
	Grantor (Exact Legal Name)	 	Formation	 	 	Org. ID No.	 	 	Business	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 





[TO BE COMPLETED BY GRANTORS]




F-19









 








SCHEDULE 4 TO SECURITY AGREEMENT




Deposit Accounts and Securities Accounts




Deposit Accounts:




	 	 	 	 	 	 	 	 	 
	Grantor	 	Bank	 	 	Account No.	 
	 
	 	 	 	 	 	 	 	 




Securities Accounts:




[NONE]




[TO BE COMPLETED BY GRANTORS]




F-20









 








ANNEX 1 TO SECURITY AGREEMENT




FORM OF SECURITY AGREEMENT SUPPLEMENT




     THIS SECURITY AGREEMENT SUPPLEMENT dated as of                     , 200___(this “Supplement”) executed
and delivered by                     , a                      (the “New Grantor”) in favor of WACHOVIA
BANK, NATIONAL ASSOCIATION, as Agent (the “Secured Party”).



     WHEREAS, pursuant to that certain Credit Agreement dated as of April 10, 2007 (as amended,
restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and
among Ashford Hospitality Limited Partnership (the “Borrower”), the financial institutions from
time to time party thereto as “Lenders”, the Secured Party, and the other parties thereto, the
Secured Party and the Lenders have agreed to make available to the Borrower certain financial
accommodations on the terms and conditions set forth in the Credit Agreement;



     WHEREAS, to secure obligations owning by certain parties under the Credit Agreement and the
other Loan Documents, the Borrower and the other “Grantors” thereunder have executed and delivered
that certain Security Agreement dated as of April 10, 2007 (as amended, restated, supplemented or
otherwise modified from time to time, the “Security Agreement”) in favor of the Secured Party;



     WHEREAS, it is a condition precedent to the continued extension by the Lenders and the Secured
Party of such financial accommodations that the New Pledgor execute this Supplement to become a
party to the Security Agreement.



     NOW, THEREFORE, in consideration of the above premises and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged by the New Grantor, the
New Grantor hereby agrees as follows:



     Section 1. Accession to Security Agreement; Grant of Security Interest. The New
Grantor agrees that it is a “Grantor” under the Security Agreement and assumes all obligations of a
“Grantor” thereunder, all as if the New Grantor had been an original signatory to the Security
Agreement. Without limiting the generality of the foregoing, the New Grantor hereby:



     (a) mortgages, pledges and hypothecates to the Secured Party for the benefit of the Lenders,
and grants to the Secured Party for the benefit of the Lenders a lien on and security interest in,
all of such Grantor’s right, title and interest in, to and under the Collateral of such Grantor,
all as collateral security for the full, prompt and complete payment and performance when due
(whether at stated maturity, by acceleration or otherwise) of the Secured Obligations;



     (b) makes to the Secured Party and the Lenders as of the date hereof each of the
representations and warranties contained in Section 4 of the Security Agreement and agrees to be



F-21









 







bound by each of the covenants contained in the Security Agreement, including without limitation,
those contained in Section 5 thereof; and



     (c) consents and agrees to each other provision set forth in the Security Agreement.



     Section 2. Supplement to Schedules. The information set forth in Annex 1 attached
hereto is hereby added to the information set forth in Schedules 1 through 4 of the Security
Agreement.



     SECTION 3. GOVERNING LAW. THIS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED,
AND TO BE FULLY PERFORMED, IN SUCH STATE.



     Section 3. Definitions. Capitalized terms used herein and not otherwise defined
herein shall have their respective defined meanings given them in the Security Agreement.



[Signatures on Next Page]




F-22









 








     IN WITNESS WHEREOF, the New Grantor has caused this Security Agreement Supplement to be duly
executed and delivered under seal by its duly authorized officers as of the date first written
above.



	 	 	 	 	 	 	 	 	 
	 	 	[NEW GRANTOR]	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	Title:
	 	 

	 	 
	 

	 	 	 	 	 	 

	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Address for Notices:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 





							
	 

	 	Attention:                	 	 	 	 
	 

	 	Telecopy Number:         (___)	 	 	 	 
	 

	 	Telephone Number:       (___)
	 	 

	 	 
	 

	 	 	 	 

	 	 






	 	 	 	 	 	 	 
	Accepted:	 	 	 	 
	 
	 	 	 	 	 	 
	WACHOVIA BANK, NATIONAL
   ASSOCIATION, as Agent	 	 
	 
	 	 	 	 	 	 
	By:
	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:
	 	 

	 	 
	 

	 	 	 	 

	 	 






F-23









 





ANNEX 1




[Set forth information to be disclosed on Schedules 1 through 4

with respect to the New Grantor]



This Annex shall be deemed to be a supplement to Schedules 1 through 4 attached to the Security
Agreement.





F-24









 





EXHIBIT G




FORM OF REVOLVING NOTE




			
	$                    
	 	                    , 20___






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



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



     This Note is one of the Revolving Notes referred to in the Credit Agreement dated as of April
10, 2007 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit
Agreement”), by and among the Borrower, the financial institutions party thereto and their
assignees under Section 12.5. thereof (the “Lenders”) and the Agent. Capitalized terms used
herein, and not otherwise defined herein, have their respective meanings given them in the Credit
Agreement.



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



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



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



G-1









 





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



     Time is of the essence for this Note.



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



	 	 	 	 	 	 	 	 	 	 	 
	 	 	ASHFORD HOSPITALITY LIMITED PARTNERSHIP

By: Ashford OP General Partner LLC, its general partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:
	 	 	 	 
	 

	 	 	 	 	 	Title:
	 	 

 
 

	 	  






G-2









 





SCHEDULE OF REVOLVING LOANS




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



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





G-3









 





EXHIBIT H




FORM OF TERM NOTE




			
	$                    
	 	                    , 20___






     FOR VALUE RECEIVED, the undersigned, ASHFORD HOSPITALITY LIMITED PARTNERSHIP, a limited
partnership formed under the laws of the State of Delaware (the “Borrower”), hereby promises to pay
to the order of ___(the “Lender”), in care of Wachovia Bank, National
Association, as Agent (the “Agent”) at Wachovia Bank, National Association, One Wachovia Center,
301 South College Street, Charlotte, North Carolina 28288, or at such other address as may be
specified in writing by the Agent to the Borrower, the principal sum of ___AND
___/100 DOLLARS ($___) (or such lesser amount as shall equal the aggregate unpaid
principal amount of the Term Loan made by the Lender to the Borrower under the Credit Agreement (as
herein defined)), on the dates and in the principal amounts provided in the Credit Agreement, and
to pay interest on the unpaid principal amount owing hereunder, at the rates and on the dates
provided in the Credit Agreement.



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



     This Note is one of the Term Notes referred to in the Credit Agreement dated as of April 10,
2007 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit
Agreement”), by and among the Borrower, the financial institutions party thereto and their
assignees under Section 12.5. thereof (the “Lenders”) and the Agent. Capitalized terms used
herein, and not otherwise defined herein, have their respective meanings given them in the Credit
Agreement.



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



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



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



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



     Time is of the essence for this Note.



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



	 	 	 	 	 	 	 	 	 	 	 
	 	 	ASHFORD HOSPITALITY LIMITED PARTNERSHIP

By: Ashford OP General Partner LLC, its general partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:
	 	 	 	 
	 

	 	 	 	 	 	Title:
	 	 

 
 

	 	  






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SCHEDULE TO TERM NOTE




     This Note evidences one of the Term Loans made under the within-described Credit Agreement to
the Borrower, subject to the payments and prepayments of principal set forth below:



	 	 	 	 	 
	Amount	 	 	 	 
	Paid or	 	Unpaid Principal	 	Notation
	Prepaid	 	Amount	 	Made By
	 
	 	 	 	 





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EXHIBIT I




FORM OF OPINION OF COUNSEL




     Opinion of counsel to the Loan Parties shall address the following matters, and such
other matters as the Agent may reasonably request:




	1.	 	Due organization or formation of each Loan Party;
	 
	2.	 	Power of each Loan Party to (a) execute and deliver, and to perform its
obligations under, the Loan Documents to which it is a party, (b) own and use its
assets, and (c) conduct its business as presently conducted;
	 
	3.	 	Good standing of each Loan Party in jurisdiction of organization or formation
and qualification of each Loan Party to transact business in jurisdictions where
required to be so qualified;
	 
	4.	 	Each Loan Party’s authorization of the execution and delivery of the Loan
Documents to which it is a party and the performance by such Loan Party of all of its
obligations under each such Loan Document;
	 
	5.	 	Each Loan Party’s due execution and delivery of the Loan Documents to which it
is a party;
	 
	6.	 	Each Loan Document being a valid and binding obligation of each Loan Party
which is a party thereto, enforceable against each such Loan Party in accordance with
its terms, except as such enforceability may be limited by: (a) applicable bankruptcy,
insolvency, reorganization, moratorium, arrangement or similar laws relating to or
affecting the enforcement of creditors’ rights generally and (b) the fact that
equitable remedies or relief (including, but not limited to, the remedy of specific
performance) are subject to the discretion of the court before which any such remedies
or relief may be sought;
	 
	7.	 	The Pledge Agreement creating a valid and enforceable security interest in
favor of the Agent in the Collateral (as defined in the Pledge Agreement) and
perfection of such security interest;
	 
	8.	 	The Security Agreement creating a valid and enforceable security interest in
favor of the Agent in the Collateral (as defined in the Security Agreement) and
perfection of such security interest;
	 
	9.	 	All financing statements being filed in connection with the Pledge Agreement
and Security Agreement being in appropriate form for filing;





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	10.	 	The execution, delivery and performance by each Loan Party of the Loan
Documents to which it is a party not resulting in any: (a) violation of such Loan
Party’s organizational documents; (b) violation of any existing federal or state
constitution, statute, regulation, rule, order, or law to which such Loan Party or its
assets are subject; (c) breach or violation of or default under, any agreement,
instrument, indenture or other document evidencing any indebtedness for money borrowed
or any other material agreement to which, to our knowledge, such Loan Party is bound or
under which a Loan Party or its assets is subject; (d) creation or imposition of a lien
or security interest in, on or against the assets of such Loan Party under any
agreement, instrument, indenture or other document evidencing any indebtedness for
money borrowed or any other material agreement to which, to the knowledge of counsel,
such Loan Party is bound or under which a Loan Party or its assets is subject; or (e)
violation of any judicial or administrative decree, writ, judgment or order to which,
to the knowledge of counsel, such Loan Party or its assets are subject;
	 
	11.	 	The execution, delivery and performance by each Loan Party of each Loan
Document to which it is a party, and the consummation of the transactions thereunder,
not requiring any registration with, consent or approval of, or notice to, or other
action to, with or by, any Governmental Authority of the United States of America or
the States of Delaware, New York or Texas;
	 
	12.	 	None of the Loan Parties being, or, after giving effect to any Loan will be,
subject to regulation under the Investment Company Act of 1940 or to any federal or
state statute or regulation limiting its ability to incur indebtedness for borrowed
money;
	 
	13.	 	No transfer, mortgage, intangible, documentary stamp or similar taxes being
payable by the Agent or the Lenders in connection with (a) the execution and delivery
of the Loan Documents, (b) the creation of the Indebtedness and the other Obligations
evidenced by any of the Loan Documents or (c) the perfection of the Agent’s Lien in any
of the Collateral;
	 
	14.	 	Assuming that the Borrower applies the proceeds of the Loans as provided in the
Credit Agreement, the transactions contemplated by the Loan Documents not violating the
provisions of Regulations T, U or X of the Board of Governors of the Federal Reserve
System of the United States of America; and
	 
	15.	 	The consideration to be paid to the Agent and the Lenders for the financial
accommodations to be provided to the Loan Parties pursuant to the Credit Agreement not
violating any law of the States of New York or Texas relating to interest and usury.





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EXHIBIT J




FORM OF COMPLIANCE CERTIFICATE




                    , 20___




Wachovia Bank, National Association, as Agent

One Wachovia Center

301 South College Street, NC0172

Charlotte, North Carolina 28288

Attention: David M. Blackman




Each of the Lenders Party to the Credit

Agreement referred to below



Ladies and Gentlemen:




     Reference is made to that certain Credit Agreement dated as of April 10, 2007 (as amended,
restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and
among Ashford Hospitality Limited Partnership (the “Borrower”), the financial institutions party
thereto and their assignees under Section 12.5. thereof (the “Lenders”) Wachovia Bank, National
Association, as Agent (the “Agent”), and the other parties thereto. Capitalized terms used herein,
and not otherwise defined herein, have their respective meanings given them in the Credit
Agreement.



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



     (1) The undersigned is the                      of the Parent.



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



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



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



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



	 	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Name:

Title:
	 	 
 

 
 

	 	  






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Schedule 1




[Calculations to be Attached]




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EXHIBIT K




FORM OF GUARANTY




     THIS GUARANTY dated as of April 10, 2007, executed and delivered by each of the undersigned
and the other Persons from time to time party hereto pursuant to the execution and delivery of an
Accession Agreement in the form of Annex I hereto (all of the undersigned, together with such other
Persons each a “Guarantor” and collectively, the “Guarantors”) in favor of (a) WACHOVIA BANK,
NATIONAL ASSOCIATION, in its capacity as Agent (the “Agent”) for the Lenders under that certain
Credit Agreement dated as of April 10, 2007 (as amended, restated, supplemented or otherwise
modified from time to time, the “Credit Agreement”), by and among Ashford Hospitality Limited
Partnership (the “Borrower”), the financial institutions party thereto and their assignees under
Section 12.5. thereof (the “Lenders”) and the Agent and (b) the Lenders.



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



     WHEREAS, the Borrower and each of the Guarantors, though separate legal entities, are members
of the same corporate family and have determined it to be in their mutual best interests to obtain
financing from the Agent and the Lenders through their collective efforts;



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



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



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



     Section 1. Guaranty. Each Guarantor hereby absolutely, irrevocably and
unconditionally guaranties the due and punctual payment and performance when due, whether at stated
maturity, by acceleration or otherwise, of all of the following (collectively referred to as the
“Guarantied Obligations”): (a) all indebtedness and obligations owing by the Borrower to any Lender
or the Agent under or in connection with the Credit Agreement and any other Loan Document,
including without limitation, the repayment of all principal of the Loans and the Reimbursement
Obligations, and the payment of all interest, Fees, charges, attorneys’ fees and other amounts
payable to any Lender or the Agent thereunder or in connection therewith; (b) any and all
extensions, renewals, modifications, amendments or substitutions of the foregoing; (c) all



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expenses, including, without limitation, reasonable attorneys’ fees and disbursements, that are
incurred by the Lenders and the Agent in the enforcement of any of the foregoing or any obligation
of such Guarantor hereunder; and (d) all other Obligations.



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



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



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



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



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



     (d) any settlement or compromise of any of the Guarantied Obligations, any security therefor,
or any liability of any other party with respect to the Guarantied Obligations, or any



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subordination of the payment of the Guarantied Obligations to the payment of any other liability of
the Borrower or any other Loan Party;



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



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



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



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



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



     (j) any defense, set-off, claim or counterclaim (other than indefeasible payment and
performance in full) which may at any time be available to or be asserted by the Borrower, any
other Loan Party or any other Person against the Agent or any Lender;



     (k) any change in the corporate existence, structure or ownership of the Borrower or any other
Loan Party;



     (l) any statement, representation or warranty made or deemed made by or on behalf of the
Borrower, any Guarantor or any other Loan Party under any Loan Document, or any amendment hereto or
thereto, proves to have been incorrect or misleading in any respect; or



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



     Section 4. Action with Respect to Guarantied Obligations. The Lenders and the Agent
may, at any time and from time to time, without the consent of, or notice to, any Guarantor, and
without discharging any Guarantor from its obligations hereunder, take any and all actions
described in Section 3 and may otherwise: (a) amend, modify, alter or supplement the terms of any
of the Guarantied Obligations, including, but not limited to, extending or shortening the time of
payment of any of the Guarantied Obligations or changing the interest rate that may accrue on any
of the Guarantied Obligations; (b) amend, modify, alter or supplement the Credit Agreement or any
other Loan Document; (c) sell, exchange, release or otherwise deal with all, or any part, of any
collateral securing any of the Obligations; (d) release any other Loan Party or other Person



K-3









 







liable in any manner for the payment or collection of the Guarantied Obligations; (e) exercise, or
refrain from exercising, any rights against the Borrower, any other Guarantor or any other Person;
and (f) apply any sum, by whomsoever paid or however realized, to the Guarantied Obligations in
such order as the Lenders shall elect.



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



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



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



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



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



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



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be paid to such Guarantor on account of or in respect of such subrogation rights or other claims or
causes of action, such Guarantor shall hold such amount in trust for the benefit of the Agent and
the Lenders and shall forthwith pay such amount to the Agent to be credited and applied against the
Guarantied Obligations, whether matured or unmatured, in accordance with the terms of the Credit
Agreement or to be held by the Agent as collateral security for any Guarantied Obligations
existing.



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



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



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



     Section 14. Avoidance Provisions. It is the intent of each Guarantor, the Agent and
the Lenders that in any Proceeding, such Guarantor’s maximum obligation hereunder shall equal, but
not exceed, the maximum amount which would not otherwise cause the obligations of such Guarantor
hereunder (or any other obligations of such Guarantor to the Agent and the Lenders) to be avoidable
or unenforceable against such Guarantor in such Proceeding as a result of Applicable Law, including
without limitation, (a) Section 548 of the Bankruptcy Code of 1978,



K-5









 







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



     Section 15. Guarantor Reimbursement. To the extent that any Guarantor shall be
required hereunder to pay a portion of the Guarantied Obligations which shall exceed the greater of
(i) the amount of the economic benefit actually received by such Guarantor from the Guarantied
Obligations and (ii) the amount which such Guarantor would otherwise have paid if such Guarantor
had paid the aggregate amount of the Guarantied Obligations (excluding the amount thereof repaid by
the Borrower) in the same proportion as such Guarantor’s net worth at the date enforcement
hereunder is sought bears to the aggregate net worth of all the Guarantors at the date enforcement
hereunder is sought, then such Guarantor shall be reimbursed by such other Guarantors for the
amount of such excess, pro rata, based on the respective net worths of such other Guarantors at the
date enforcement hereunder is sought.



     Section 16. Information. Each Guarantor assumes all responsibility for being and
keeping itself informed of the financial condition of the Borrower and the other Guarantors, and of
all other circumstances bearing upon the risk of nonpayment of any of the Guarantied Obligations
and the nature, scope and extent of the risks that such Guarantor assumes and incurs hereunder, and
agrees that neither the Agent nor any of the Lenders shall have any duty whatsoever to advise any
Guarantor of information regarding such circumstances or risks.



     Section 17. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE
FULLY PERFORMED, IN SUCH STATE.



     SECTION 18. WAIVER OF JURY TRIAL.



     (a) EACH PARTY HERETO ACKNOWLEDGES THAT ANY DISPUTE OR CONTROVERSY BETWEEN OR AMONG ANY
GUARANTOR, THE AGENT OR ANY OF THE LENDERS WOULD BE BASED ON DIFFICULT AND COMPLEX ISSUES OF LAW



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



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



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



     Section 19. Loan Accounts. The Agent and each Lender may maintain books and accounts
setting forth the amounts of principal, interest and other sums paid and payable with respect to
the Guarantied Obligations, and in the case of any dispute relating to any of the outstanding
amount, payment or receipt of any of the Guarantied Obligations or otherwise, the entries in such
books and accounts shall be deemed conclusive evidence of the amounts and other matters set forth
herein, absent manifest error. The failure of the Agent or any Lender to



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maintain such books and accounts shall not in any way relieve or discharge any Guarantor of any of
its obligations hereunder.



     Section 20. Waiver of Remedies. No delay or failure on the part of the Agent or any
Lender in the exercise of any right or remedy it may have against any Guarantor hereunder or
otherwise shall operate as a waiver thereof, and no single or partial exercise by the Agent or any
Lender of any such right or remedy shall preclude any other or further exercise thereof or the
exercise of any other such right or remedy.



     Section 21. Termination. This Guaranty shall remain in full force and effect until
indefeasible payment in full of the Guarantied Obligations and the other Obligations and the
termination or cancellation of the Credit Agreement in accordance with its terms.



     Section 22. Successors and Assigns. Each reference herein to the Agent or the
Lenders shall be deemed to include such Person’s respective successors and assigns (including, but
not limited to, any holder of the Guarantied Obligations) in whose favor the provisions of this
Guaranty also shall inure, and each reference herein to each Guarantor shall be deemed to include
such Guarantor’s successors and assigns, upon whom this Guaranty also shall be binding. The
Lenders may, in accordance with the applicable provisions of the Credit Agreement, assign, transfer
or sell any Guarantied Obligation, or grant or sell participations in any Guarantied Obligations,
to any Person without the consent of, or notice to, any Guarantor and without releasing,
discharging or modifying any Guarantor’s obligations hereunder. Subject to Section 12.8. of the
Credit Agreement, each Guarantor hereby consents to the delivery by the Agent or any Lender to any
Assignee or Participant (or any prospective Assignee or Participant) of any financial or other
information regarding the Borrower or any Guarantor. No Guarantor may assign or transfer its
rights or obligations hereunder to any Person without the prior written consent of all Lenders and
any such assignment or other transfer to which all of the Lenders have not so consented shall be
null and void.



     Section 23. JOINT AND SEVERAL OBLIGATIONS. THE OBLIGATIONS OF THE GUARANTORS
HEREUNDER SHALL BE JOINT AND SEVERAL, AND ACCORDINGLY, EACH GUARANTOR CONFIRMS THAT IT IS LIABLE
FOR THE FULL AMOUNT OF THE “GUARANTIED OBLIGATIONS” AND ALL OF THE OBLIGATIONS AND LIABILITIES OF
EACH OF THE OTHER GUARANTORS HEREUNDER.



     Section 24. Amendments. This Guaranty may not be amended except in writing signed by
the Requisite Lenders (or all of the Lenders if required under the terms of the Credit Agreement),
the Agent and each Guarantor.



     Section 25. Payments. All payments to be made by any Guarantor pursuant to this
Guaranty shall be made in Dollars, in immediately available funds to the Agent at the Principal
Office, not later than 2:00 p.m. on the date of demand therefor.



     Section 26. Notices. All notices, requests and other communications hereunder shall
be in writing (including facsimile transmission or similar writing) and shall be given (a) to each
Guarantor at its address set forth below its signature hereto, (b) to the Agent or any Lender at
its



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respective address for notices provided for in the Credit Agreement, or (c) as to each such party
at such other address as such party shall designate in a written notice to the other parties. Each
such notice, request or other communication shall be effective (i) if mailed, when received; (ii)
if telecopied, when transmitted; or (iii) if hand delivered, when delivered; provided, however,
that any notice of a change of address for notices shall not be effective until received.



     Section 27. Severability. In case any provision of this Guaranty shall be invalid,
illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.



     Section 28. Headings. Section headings used in this Guaranty are for convenience
only and shall not affect the construction of this Guaranty.



     Section 29. Limitation of Liability. Neither the Agent nor any Lender, nor any
Affiliate, officer, director, employee, attorney, or agent of the Agent or any Lender, shall have
any liability with respect to, and each Guarantor hereby waives, releases, and agrees not to sue
any of them upon, any claim for any special, indirect, incidental, or consequential damages
suffered or incurred by a Guarantor in connection with, arising out of, or in any way related to,
this Guaranty or any of the other Loan Documents, or any of the transactions contemplated by this
Guaranty, the Credit Agreement or any of the other Loan Documents. Each Guarantor hereby waives,
releases, and agrees not to sue the Agent or any Lender or any of the Agent’s or any Lender’s
Affiliates, officers, directors, employees, attorneys, or agents for punitive damages in respect of
any claim in connection with, arising out of, or in any way related to, this Guaranty, the Credit
Agreement or any of the other Loan Documents, or any of the transactions contemplated by Credit
Agreement or financed thereby.



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



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



     (b) Terms not otherwise defined herein are used herein with the respective meanings given them
in the Credit Agreement.



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     IN WITNESS WHEREOF, each Guarantor has duly executed and delivered this Guaranty as of the
date and year first written above.



	 	 	 	 	 	 	 	 	 
	 	 	[GUARANTORS]	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:
	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:

Title:
	 	 
 

 
 

	 	  
	 
	 	 	 	 	 	 	 	 
	 	 	Address for Notices:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	c/o Ashford Hospitality Limited Partnership

14185 Dallas Parkway, Suite 1100

Dallas, Texas 75245

Attention: David Brooks, Chief Legal Officer

Telecopy Number:      (972) 490-9605

Telephone Number:   (972) 778-9207
	 	 






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ANNEX I




FORM OF ACCESSION AGREEMENT




     THIS ACCESSION AGREEMENT dated as of ___, 20___, executed and delivered by
___, a ___(the “New Guarantor”), in favor of (a) WACHOVIA BANK,
NATIONAL ASSOCIATION, in its capacity as Agent (the “Agent”) for the Lenders under that certain
Credit Agreement dated as of April 10, 2007 (as amended, restated, supplemented or otherwise
modified from time to time, the “Credit Agreement”), by and among Ashford Hospitality Limited
Partnership (the “Borrower”), the financial institutions party thereto and their assignees under
Section 12.5. thereof (the “Lenders”) and the Agent, (b) the Lenders.



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



     WHEREAS, the Borrower, the New Guarantor, and the existing Guarantors, though separate legal
entities, are [members of the same corporate family] and have determined it to be in their mutual
best interests to obtain financing from the Agent and the Lenders through their collective efforts;



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



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



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



     Section 1. Accession to Guaranty. The New Guarantor hereby agrees that it is a
“Guarantor” under that certain Guaranty dated as of April 10, 2007 (as amended, supplemented,
restated or otherwise modified from time to time, the “Guaranty”), made by each Subsidiary of the
Borrower a party thereto in favor of the Agent and the Lenders and assumes all obligations of a
“Guarantor” thereunder and agrees to be bound thereby, all as if the New Guarantor had been an
original signatory to the Guaranty. Without limiting the generality of the foregoing, the New
Guarantor hereby:



     (a) irrevocably and unconditionally guarantees the due and punctual payment and performance
when due, whether at stated maturity, by acceleration or otherwise, of all Guarantied Obligations
(as defined in the Guaranty);



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     (b) makes to the Agent and the Lenders as of the date hereof each of the representations and
warranties contained in Section 5 of the Guaranty and agrees to be bound by each of the covenants
contained in Section 6 of the Guaranty; and



     (c) consents and agrees to each provision set forth in the Guaranty.



     SECTION 2. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED,
AND TO BE FULLY PERFORMED, IN SUCH STATE.



     Section 3. Definitions. Capitalized terms used herein and not otherwise defined
herein shall have their respective defined meanings given them in the Credit Agreement.



[Signatures on Next Page]




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     IN WITNESS WHEREOF, the New Guarantor has caused this Accession Agreement to be duly executed
and delivered under seal by its duly authorized officers as of the date first written above.



	 	 	 	 	 	 	 	 	 
	 	 	[NEW GUARANTOR]	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:
	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:

Title:
	 	 
 

 
 

	 	  
	 
	 	 	 	 	 	 	 	 
	 	 	Address for Notices:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	c/o Ashford Hospitality Limited Partnership	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 
	 	 	Attention:                     

Telecopy Number:         (_____)                     

Telephone Number:       (_____)                     	 	 






	 	 	 	 	 	 	 
	Accepted:	 	 
	 
	 	 	 	 	 	 
	WACHOVIA BANK, NATIONAL

      ASSOCIATION, as Agent	 	 
	 
	 	 	 	 	 	 
	By:

	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Name:

Title:
	 	 
 

 
 

	 	  







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